Democrats Fight to Curb Forced Arbitration Clauses

WASHINGTON (CN) – Flanked by former Fox News anchor Gretchen Carlson and others forced into arbitration clauses with large companies, congressional Democrats reintroduced a package of legislation Tuesday that would cut back on the use of the controversial practice.

Along with Carlson, who said arbitration clauses like the one in her contract with Fox News “silence” women who are victims of sexual harassment in the workplace, two other people unable to pursue claims against companies because of forced arbitration clauses in their agreements detailed their stories and called on Congress to take up their cause.

“The arbitration process often argued to be quicker and cheaper for employees instead silences millions of other survivors who may have come forward if they knew they weren’t alone,” said Carlson, who left Fox last June after claiming former network head Roger Ailes sexually harassed her and other women throughout her time at the company.

Kevin Zoiber detailed how a forced arbitration clause, which he signed as a condition of keeping his job with a government contractor, stopped him from pursuing a public trial against the company, which he says fired him shortly before his reservist unit was called to active duty.

Aaron Brodie, a victim of the Wells Fargo scheme of opening accounts in customers’ name without their permission, told lawmakers that he attempted to join a class action suit against the bank only to have the company push them to arbitration based on a clause in another agreement he had signed or a separate account.

“The only way that we’ll be able to achieve justice is through the courts,” Brodie said at the press conference.

Led by Minnesota Sen. Al Franken, the key piece of legislation the Democrats introduced Tuesday is the Arbitration Fairness Act, which amends the Federal Arbitration Act to prevent companies from putting clauses in agreements in advance that require arbitration for “employment, consumer, antitrust and civil rights disputes.”

Such clauses force people – often employees or customers – to submit to arbitration if they have a disagreement with a company, sometimes without the person being aware of what they have signed or without any other option.

Franken and the other Democrats who introduced the legislation say the forced arbitration clauses are “a permission slip for corporations to opt out of the civil justice system.”

“From nursing home contracts and employment agreements to credit card and cellphone contracts, corporate America uses forced arbitration clauses to restrict Americans’ access to justice by stripping consumers and workers of their constitutional right to have their claims heard in a public court of law,” Franken said at a press conference Tuesday. “Instead they’re forced into a private justice system that is inherently biased towards corporations.”

Franken told Courthouse News he would “obviously” discuss forced arbitration with U.S. Supreme Court nominee Neil Gorsuch when the two meet Tuesday afternoon, and hoped to hear the judge say he is “open on this issue.”

Franken introduced the same legislation during the last session of Congress, but the bill never made it out of the Senate Judiciary Committee. Still, Franken told reporters after the press conference that some Republicans, notably Senate Judiciary Committee Chairman Sen. Chuck Grassley, have “had a history of seeing this issue in the proper light.”