May 15, 2018

Pressure From Public Citizen and Allies Forces Uber to Take Step, Ban Forced Arbitration

Statement of Remington A. Gregg, Counsel for Civil Justice and Consumer Rights, Public Citizen’s Congress Watch Division

Note: Uber said today that it has eliminated forced arbitration agreements that keep employees, drivers and passengers victimized by sexual harassment from pursuing their rights in court. The change reportedly will allow employees, drivers and passengers who make harassment claims to choose the venue of their choice to deal with their dispute: mediation, arbitration or a neutral, open court. Public Citizen and other consumer organizations on behalf of millions of Main Street Americans recently asked the company to eliminate the use of forced arbitration clauses from employment contracts for all claims.

Uber recently agreed to settle a claim on behalf of 420 women and minority engineers, but only after it tried to use the “rip-off clause” buried in its employment contracts to force the victims into secretive arbitration proceedings instead of allowing them to go to court if they chose to.

Now, in the glare of public scrutiny, amid the #MeToo movement and after consumer organizations have demanded action, Uber has been compelled to take the modest but important step of removing forced arbitration provisions related to harassment claims. Shamefully, Uber still aims to ban harassment survivors from banding together to bring class actions.

Forced arbitration clauses in employment contracts are particularly insidious because they allow companies to sweep systemic issues of discrimination and harassment under the rug and keep them hidden from public scrutiny. These clauses silence victims and embolden harassers.

But forced arbitration abuses reach far beyond the harassment context. Now Uber must take an additional step and ban these clauses from their contracts for any circumstance and allow employees, drivers and consumers to join together in class actions to bring suit against the company.

We are at a moment of reckoning in the private sector, in Congress and in society. It’s past time for companies to remove these abusive provisions from employment contracts – and consumer contracts as well. But large corporations have proven that we cannot rely on voluntary action alone. They consistently have exploited U.S. Supreme Court decisions to deny rights and redress to injured employees and consumers. Congress must act to end the practice of forced arbitration altogether.

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Note: Public Citizen has been leading the way on improving access to justice for survivors of discrimination and harassment. See here for more information.