Published: December 2013

Stop Big Business from evading the civil justice system

Congress has passed laws to ban forced arbitration for disputes involving auto dealers, poultry and livestock producers, certain employees of federal contractors, and servicemembers for some credit and loan products. The time has come for Congress to outlaw forced arbitration for all America’s consumers and workers and pass the Arbitration Fairness Act of 2013 (AFA).

Consumer Action joins the undersigned organizations in strongly supporting the Arbitration Fairness Act of 2013 (or “AFA”), S. 878, introduced in the Senate by Senator Al Franken (D-MN). Specifically, the AFA would make forced arbitration unenforceable in civil rights, employment, antitrust, and consumer disputes.

Predispute binding mandatory (or forced) arbitration clauses are proliferating in employment contracts (including minimum wage-workers, whistleblowers, servicemembers, and executives), and in everyday consumer contracts for products and services such as credit cards, child care, cell phones, car loans, home construction, student loans, rent-to- own products, payday loans, health insurance policies, and nursing homes. Consumer and employment contracts with arbitration clauses are often non-negotiable, and erode traditional legal safeguards.

Corporations that place forced arbitration clauses in their standard contracts with consumers and non-union employees shield themselves from accountability for wrongdoing. The contracts typically specify who the arbitrator will be, under what rules the arbitration will take place, the state the arbitration will occur in, and the payment terms for the arbitration. In addition to targeting vulnerable populations, forced arbitration also weakens the value of federal and state laws intended to protect consumers and employees by removing their ability to enforce those laws in court.

The AFA would allow consumers and employees to choose arbitration after the dispute arises. Congress has passed laws to ban forced arbitration for disputes involving auto dealers, poultry and livestock producers, certain employees of federal contractors, and servicemembers for some credit and loan products. The time has come for Congress to outlaw forced arbitration for all America’s consumers and workers.

 

Lead Organization

Alliance for Justice

Other Organizations

9to5 | AARP | AFL-CIO | Alliance for Justice | American Association for Justice | American Association of University Women | American Civil Liberties Union (ACLU) | American Federation of State, County and Municipal Employees (AFSCME), AFL-CIO Americans for Financial Reform | Bazelon Center for Mental Health Law | Center for Justice & Democracy | Center for Responsible Lending | Citizen Works | Committee to Support the Antitrust Laws | Consumer Action | Consumer Federation of America | Consumer Watchdog | Consumers for Auto Reliability and Safety | Consumers Union | ConsumersCount.Org | D.C. Consumer Rights Coalition | Home Owners for Better Building | Homeowners Against Deficient Dwellings | Legal Aid Justice Center | Maryland Consumer Rights Coalition | MFY Legal Services, Inc. | NAACP | National Association of Consumer Advocates | National Consumer Voice for Quality Long-Term Care | National Consumer Law Center (on behalf of its low income clients) | National Consumers League | National Employment Law Project | National Employment Lawyers Association (NELA) National Partnership for Women & Families National Women's Law Center | NC Justice Center | People For the American Way | Public Citizen | Reserve Officers Association (ROA) | The Leadership Conference on Civil and Human Rights | U.S. Public Interest Research Group | West Virginia Citizen Action Group

More Information

To read the entire letter, please click here.

For more information, please visit Fair Arbitration Now.

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