The Arbitration Fairness Act of 2011
Arbitration is a form of alternative dispute resolution (ADR) that aims to settle legal disputes outside of the court system. While this can be valuable in some situations, many commercial companies and employers place forced arbitration terms in their contracts, requiring disputes to be settled by arbitration alone. This prevents people from exercising their legal right to take a company to court, allowing many major industries to escape accountability altogether.
Understanding Forced Arbitration
Brought down to the level of the average consumer, forced arbitration means that you are denied your right to pursue a potential lawsuit or class action against a corporation whenever you:
- Sign up for a credit card
- Sign a contract for a cell phone service
- Open a bank account
- Enter into a student loan
- Plan to buy a car
- Sign an employment contract
- Place a loved one in the care of a nursing home
Arbitration is a private system of justice: there is no judge, jury, or appeal process, and the decisions of an arbitrator are not reviewed by the public to ensure they got it right. In addition, contracts usually name the arbitrator that will be used, which is almost always based on company preference. Because of this, individuals are prevented from effectively suing for defective products, scams, negligence, and even abuse.
Potential Effects of the Arbitration Fairness Act of 2011
In an effort to protect the constitutional rights of consumers and employees, the Arbitration Fairness Act of 2011 has recently been proposed by Senator Russ Feingold (of Wisconsin) and Congressman Hank Johnson (of Georgia). With support from numerous different groups, law organizations, and sponsors, the proposed bill would outlaw mandatory binding arbitration clauses in employment, franchise, and consumer disputes.
Under the bill, parties involved in a dispute would be allowed a choice between arbitration or a court action when pursuing a complaint. This decision would be made after a dispute arises, allowing for an informed decision about the individual’s options. The rights that are at stake with employment and consumer disputes are simply too important – to both the nation and the individual – to be left in the hands of an arbitrator who lacks the accountability and openness that comes with court actions.
If you have more questions about arbitration and how the Arbitration Fairness Act could affect your ability to pursue a complaint in court, please contact us today for a free initial consultation. Colling, Gilbert, Wright & Carter serve clients throughout the Orlando area.