House Passes Bill Banning Mandatory Pre-Dispute Arbitration Agreements

Published on: September 27, 2019

Topics: Employment Law

The House voted 225 to 186, with two Republicans voting in favor, to pass the Forced Arbitration Injustice Repeal Act (H.R. 1423), which would prohibit mandatory pre-dispute arbitration agreements in all employment, consumer, antitrust, and civil rights disputes.

The bill would also prohibit agreements and practices that interfere with the right of individuals, workers, and small businesses to participate in a joint, class, or collective action related to an employment, consumer, antitrust, or civil rights dispute.

While the measure would not ban arbitration altogether, employers would not be allowed to require individuals to agree to the process as a condition of employment, and it would apply to all future disputes regardless of whether there was already an arbitration agreement in place.

President Trump has vowed to veto the bill were it to ever reach his desk.  The chances of that happening, however, are extremely slim despite some interest by a few GOP Senators to do something regarding arbitration in sexual harassment disputes.

Outlook:  President Trump’s promised veto, a lack of appetite in the Senate to take on the issue, and the movement in the House toward impeachment do not work in the favor of further movement for this bill.  However, the issue is on the radar of Democratic presidential candidates and will likely be an issue in the campaigns.