Forced Arbitration Injustice Repeal Act

{{Infobox United States federal proposed legislation

| name = FAIR Act of 2023

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

| introduced in the = 118th

| number of co-sponsors = 101

| public law url =

| introducedin = House

| leghisturl = https://www.congress.gov/bill/118th-congress/house-bill/2953

| introducedbill = [https://www.congress.gov/bill/118th-congress/house-bill/2953 H.R.2953]

| introduceddate = April 27, 2023

| introducedby = Hank Johnson (D–GA)

| committees = United States House Committee on the Judiciary, United States Senate Committee on the Judiciary

| enacted by =

}}

{{Short description|Proposed law banning most pre-dispute binding arbitration agreements}}

The Forced Arbitration Injustice Repeal (FAIR) Act is proposed legislation in the US Congress. The comprehensive legislation would prohibit pre-dispute, forced arbitration agreements from being valid or enforceable if it requires forced arbitration of an employment, consumer, or civil rights claim against a corporation.{{cite web |title=H.R.1423 - FAIR Act |url=https://www.congress.gov/bill/116th-congress/house-bill/1423/text?q=%7B%22search%22%3A%5B%22H.R.+1423%22%5D%7D&r=1&s=2 |website=Congress.gov |access-date=March 19, 2019}}

The bill was introduced in the 116th Congress as H.R. 1423 and S. 610.{{cite web |title=S.610 - Forced Arbitration Injustice Repeal Act |url=https://www.congress.gov/bill/116th-congress/senate-bill/610/text?q=%7B%22search%22%3A%5B%22S.610%22%5D%7D&r=1&s=3 |website=Congress.gov |date = February 28, 2019|access-date=March 19, 2019}} The bill's sponsors include Representative Hank Johnson (D-GA) and Senator Richard Blumenthal (D-CT). Similar versions of this bill were previously introduced in the 115th United States Congress as H.R. 1374 {{cite web |title=H.R.1374 - Arbitration Fairness Act of 2017 |url=https://www.congress.gov/bill/115th-congress/house-bill/1374?q=%7B%22search%22%3A%5B%22H.R.+1374%22%5D%7D&s=2&r=3 |website=Congress.gov |date = March 17, 2017|access-date=March 19, 2019}} and S. 2591.{{cite web |title=S.2591 - Arbitration Fairness Act of 2018 |url=https://www.congress.gov/bill/115th-congress/senate-bill/2591?q=%7B%22search%22%3A%5B%22S.+2591%22%5D%7D&s=3&r=1 |website=Congress.gov |date = March 22, 2018|access-date=March 19, 2019}} The FAIR Act passed the House of Representatives on September 20, 2019, by a vote of 225 to 186.{{Cite web|url=https://www.congress.gov/bill/116th-congress/house-bill/1423/actions|title=Actions - H.R.1423 - 116th Congress (2019-2020): Forced Arbitration Injustice Repeal Act|date=September 24, 2019|website=www.congress.gov|access-date=December 1, 2019}}

Blumenthal re-introduced the FAIR Act in the 117th Congress due to the FAIR Act not passing the Senate in the 116th Congress. The Senate version of the bill, S.505, has 39 cosponsors, all of them being Democrats.{{Cite web|last=Blumenthal|first=Richard|date=March 1, 2021|title=Text - S.505 - 117th Congress (2021-2022): Forced Arbitration Injustice Repeal Act|url=https://www.congress.gov/bill/117th-congress/senate-bill/505/text|access-date=July 21, 2021|website=www.congress.gov}}

Background

Forced arbitration clauses are commonly found in contracts between individuals and businesses. In cases where individuals bring legal claims against their employer or a business, forced arbitration clauses generally prohibit them taking such claims to court and instead substitute closed-door arbitration proceedings, where they are less likely to receive an impartial hearing.{{cite news |last1=Fernández Campbell |first1=Alexia |title=Google employees fought for their right to sue the company – and won |url=https://www.vox.com/technology/2019/2/22/18236172/mandatory-forced-arbitration-google-employees |access-date=March 19, 2019 |publisher=Vox |date=February 22, 2019}}

Some employers have removed provisions from contracts subjecting their employees to forced arbitration amid public pressure regarding concerns that the practice inhibits the rights of workers to hold their employer accountable for allegations of sexual harassment, discrimination, and wage theft.{{cite news |last1=Ehrenkranz |first1=Melanie |title=Google Workers' Fight to End Forced Arbitration Heads to D.C. |url=https://gizmodo.com/google-workers-fight-to-end-forced-arbitration-heads-to-1832969395 |access-date=March 19, 2019 |publisher=Gizmodo |date=February 28, 2019}} In November 2018, over 20,000 employees of the technology giant Google organized a walkout protest against the company in response to Google's policies around "equity and transparency in the workplace", which includes forced arbitration in worker contracts.{{cite news |last1=Ingram |first1=David |title=Google employees launch campaign to end all forced arbitration |url=https://www.nbcnews.com/tech/tech-news/google-employees-launch-campaign-bring-discrimination-issues-out-shadows-n959016 |access-date=March 19, 2019 |work=NBC News |date=January 15, 2019}} In February 2019, Google announced they were ending their policy of forced arbitration for full-time employees.{{cite news |last1=Bastone |first1=Nick |title=Google is ditching its mandatory-arbitration policy after mass protest |url=https://www.businessinsider.com/google-to-end-forced-arbitration-2019-2 |access-date=March 19, 2019 |publisher=Business Insider |date=February 21, 2019}}

Content

The FAIR Act defines arbitration clauses as "pre-dispute arbitration agreements" and aims to broadly end arbitration agreements for both consumers and employees. The act is planned as an amendment to the Title 9 of the United States Code, under which the new regulations would become Chapter 4.

Section 402, titled "No validity or enforceability", bans predispute arbitration agreements, as well as any predispute class action waivers in disputes regarding employment, trusts, civil rights, and/or in the sale of property and/or the usage of a service. The bill does not apply to contracts between employers and labor organizations, or between labor organizations, except if the provisions of the contract deprives workers of the right to seek judicial enforcement.

The act additionally amends Title 9 in the phrasings in section 1, 2, 208, and 307 to avoid conflict between sections and the new Chapter 4.