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Aug. 2, 2021 by M. Isabelle Chaudry

To Protect Workers and Consumers, Congress Must End Forced Arbitration

In February, Georgia Rep. Hank Johnson, chair of the House Judiciary Subcommittee on Courts, Intellectual Property, and the Internet, reintroduced the FAIR Act. The legislation would protect workers and consumers by eliminating restrictive "forced arbitration" clauses in employment and consumer contracts. The bill would also allow consumers and workers to agree to arbitration after a dispute occurs if doing so is in their best interests. A companion measure has been introduced in the Senate.

Arbitration — a process where third parties resolve legal disputes out of court — is a standard precondition to most, if not all, nonunion employment and consumer contracts. It's considered "forced" because few consumers and workers are aware that they are agreeing to mandatory arbitration when they sign contracts. In most contracts, arbitration is imposed on a take-it-or-leave-it basis before any dispute even occurs; refusing to sign is rarely a realistic option because other sellers and employers impose similar arbitration requirements.

Few consumers or workers are aware of these factors when signing a contract. When signing contracts, consumers and workers agree to adjudicate virtually all types of alleged violations of state and federal laws, including those that protect them against harmful and dangerous products, consumer fraud, employment discrimination …

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Aug. 2, 2021

To Protect Workers and Consumers, Congress Must End Forced Arbitration