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S. 610 (116th): Forced Arbitration Injustice Repeal Act

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The text of the bill below is as of Feb 28, 2019 (Introduced). The bill was not enacted into law.

Summary of this bill

Should corporations be allowed to make customers sign contracts which waive their right to a lawsuit if anything goes awry?

Context

At least tens of millions of Americans are locked into contracts mandating “forced arbitration,” meaning that any legal disputes couldn’t be handled in a traditional court. These are common in everything from cellphone contracts to employment contracts with a boss.

As a Vox article explained, such provisions make it “impossible for workers to sue their bosses in court for sexual harassment, racial discrimination, wage theft, and nearly anything else. Workers are less likely to win their cases in private arbitration, and when they do win, they tend to ...

II

116th CONGRESS

1st Session

S. 610

IN THE SENATE OF THE UNITED STATES

February 28, 2019

(for himself, Mr. Markey, Mr. Schatz, Mr. Whitehouse, Mr. Durbin, Mr. Brown, Ms. Smith, Ms. Harris, Mr. Udall, Mr. Van Hollen, Ms. Klobuchar, Mr. Heinrich, Ms. Hassan, Mr. Wyden, Mr. Merkley, Ms. Hirono, Mr. Casey, Mr. Kaine, Ms. Warren, Mr. Booker, Mr. Reed, Ms. Cortez Masto, Mrs. Shaheen, Mr. Menendez, Mrs. Gillibrand, Mrs. Murray, Ms. Duckworth, Ms. Baldwin, Mr. Leahy, Mr. Murphy, Mr. Sanders, Ms. Rosen, and Mr. Peters) introduced the following bill; which was read twice and referred to the Committee on the Judiciary

A BILL

To amend title 9 of the United States Code with respect to arbitration.

1.

Short title

This Act may be cited as the Forced Arbitration Injustice Repeal Act.

2.

Purposes

The purposes of this Act are to—

(1)

prohibit predispute arbitration agreements that force arbitration of future employment, consumer, antitrust, or civil rights disputes; and

(2)

prohibit agreements and practices that interfere with the right of individuals, workers, and small businesses to participate in a joint, class, or collective action related to an employment, consumer, antitrust, or civil rights dispute.

3.

Arbitration of employment, consumer, antitrust, and civil rights disputes

(a)

In general

Title 9 of the United States Code is amended by adding at the end the following:

4

Arbitration of Employment, Consumer, Antitrust, and Civil Rights Disputes

Sec.

401. Definitions.

402. No validity or enforceability.

401.

Definitions

In this chapter—

(1)

the term antitrust dispute means a dispute—

(A)

arising from an alleged violation of the antitrust laws (as defined in subsection (a) of the first section of the Clayton Act (15 U.S.C. 12(a)) or State antitrust laws; and

(B)

in which the plaintiffs seek certification as a class under rule 23 of the Federal Rules of Civil Procedure or a comparable rule or provision of State law;

(2)

the term civil rights dispute means a dispute—

(A)

arising from an alleged violation of—

(i)

the Constitution of the United States or the constitution of a State; or

(ii)

any Federal, State, or local law that prohibits discrimination on the basis of race, sex, age, gender identity, sexual orientation, disability, religion, national origin, or any legally protected status in education, employment, credit, housing, public accommodations and facilities, voting, veterans or servicemembers, health care, or a program funded or conducted by the Federal Government or a State government, including any law referred to or described in section 62(e) of the Internal Revenue Code of 1986, including parts of such law not explicitly referenced in such section but that relate to protecting individuals on any such basis; and

(B)

in which at least 1 party alleging a violation described in subparagraph (A) is an individual (or an authorized representative of an individual), including an individual seeking certification as a class under rule 23 of the Federal Rules of Civil Procedure or a comparable rule or provision of State law;

(3)

the term consumer dispute means a dispute between—

(A)

1 or more individuals, including an individual who seeks certification as a class under rule 23 of the Federal Rules of Civil Procedure or a comparable rule or provision of State law, who seek or acquire real or personal property, services (including services related to digital technology), securities or other investments, money, or credit for personal, family, or household purposes; and

(B)
(i)

the seller or provider of such property, services, securities or other investments, money, or credit; or

(ii)

a third party involved in the selling, providing of, payment for, receipt or use of information about, or other relationship to any such property, services, securities or other investments, money, or credit;

(4)

the term employment dispute—

(A)

means a dispute between 1 or more individuals (or their authorized representative) and a person arising out of or related to the work relationship or prospective work relationship between them, including a dispute regarding the terms of or payment for, advertising of, recruiting for, referring of, arranging for, or discipline or discharge in connection with, such work, regardless of whether the individual is or would be classified as an employee or an independent contractor with respect to such work; and

(B)

includes—

(i)

a dispute arising under any law referred to or described in section 62(e) of the Internal Revenue Code of 1986, including parts of such law not explicitly referenced in such section but that relate to protecting individuals on any such basis; and

(ii)

a dispute in which an individual seeks certification as a class under rule 23 of the Federal Rules of Civil Procedure or as a collective action under section 16(b) of the Fair Labor Standards Act (29 U.S.C. 216(b)), or a comparable rule or provision of State law;

(5)

the term predispute arbitration agreement means an agreement to arbitrate a dispute that has not yet arisen at the time of the making of the agreement; and

(6)

the term predispute joint-action waiver means an agreement, whether or not part of a predispute arbitration agreement, that would prohibit, or waive the right of, one of the parties to the agreement to participate in a joint, class, or collective action in a judicial, arbitral, administrative, or other forum, concerning a dispute that has not yet arisen at the time of the making of the agreement.

402.

No validity or enforceability

(a)

In general

Notwithstanding any other provision of this title, no predispute arbitration agreement or predispute joint-action waiver shall be valid or enforceable with respect to an employment dispute, consumer dispute, antitrust dispute, or civil rights dispute.

(b)

Applicability

(1)

In general

An issue as to whether this chapter applies with respect to a dispute shall be determined under Federal law. The applicability of this chapter to an agreement to arbitrate and the validity and enforceability of an agreement to which this chapter applies shall be determined by a court, rather than an arbitrator, irrespective of whether the party resisting arbitration challenges the arbitration agreement specifically or in conjunction with other terms of the contract containing such agreement, and irrespective of whether the agreement purports to delegate such determinations to an arbitrator.

(2)

Collective bargaining agreements

Nothing in this chapter shall apply to any arbitration provision in a contract between an employer and a labor organization or between labor organizations, except that no such arbitration provision shall have the effect of waiving the right of a worker to seek judicial enforcement of a right arising under a provision of the Constitution of the United States, a State constitution, or a Federal or State statute, or public policy arising therefrom.

.

(b)

Technical and conforming amendments

(1)

In general

Title 9 of the United States Code is amended—

(A)

in section 1, by striking of seamen, and all that follows through interstate commerce and inserting of individuals, regardless of whether the individuals are designated as employees or independent contractors for other purposes;

(B)

in section 2, by inserting or as otherwise provided in chapter 4 before the period at the end;

(C)

in section 208—

(i)

in the section heading, by striking Chapter 1; residual application and inserting Application; and

(ii)

by adding at the end the following: This chapter applies to the extent that this chapter is not in conflict with chapter 4.; and

(D)

in section 307—

(i)

in the section heading, by striking Chapter 1; residual application and inserting Application; and

(ii)

by adding at the end the following: This chapter applies to the extent that this chapter is not in conflict with chapter 4..

(2)

Table of sections

(A)

Chapter 2

The table of sections for chapter 2 of title 9, United States Code, is amended by striking the item relating to section 208 and inserting the following:

208. Application.

.

(B)

Chapter 3

The table of sections for chapter 3 of title 9, United States Code, is amended by striking the item relating to section 307 and inserting the following:

307. Application.

.

(3)

Table of chapters

The table for chapters of title 9, United States Code, is amended by adding at the end the following:

4.Arbitration of employment, consumer, antitrust, and civil rights disputes401

.

4.

Effective date

This Act, and the amendments made by this Act, shall take effect on the date of enactment of this Act and shall apply with respect to any dispute or claim that arises or accrues on or after such date.