Forced Arbitration Is Still Making Headlines and Still Hurting Workers, Consumers and Small Businesses
By Remington A. Gregg
Five months since the U.S. House of Representatives voted to ban forced arbitration clauses to protect workers, consumers and small businesses from being denied access to the courts, the problem isn’t going away and is still making headlines.
These stories illustrate why it is vital for the U.S. Senate to follow suit and ban forced arbitration clauses.
Injustice Delivered in 30 Minutes or Less
A federal judge recently blasted the self-serving hypocrisy of DoorDash, a food delivery service, around forced arbitration. After forcing its workers to sign arbitration agreements, DoorDash refused to pay the fees to begin arbitration proceedings in more than 5,000 individual cases its employees filed. When the workers asked a court to force DoorDash to pay the required fees, the company balked and decided it would rather face a class action. On Feb. 10, the judge finally issued a decision in the case, and he was not pleased. His order forces DoorDash to pay the required fees, noting, “this hypocrisy will not be blessed.”
Ripping Off Consumers
In late January, Consumer Reports published an alert on how ubiquitous forced arbitration clauses have become in consumer product contracts. The watchdog found that the terms of sale for most mattresses, microwave ovens, refrigerators, vacuum cleaners, washing machines, smartphones and televisions that it examined now include a forced arbitration clause. So go ahead and rip the tag off that new mattress. The company that made it already ripped you off in the fine print.
Stealing From the Poor to Give to the Rich
The National Employment Law Project released a report this week showing that in 2019, forced arbitration enabled employers to steal 12.6 million in lost wages from low-paid workers. Forced arbitration clauses, which often include class-action bans, make it difficult for workers to vindicate their rights alone. As a result, corporate wrongdoers escape accountability and get to keep the lost wages that rightfully belong to their employees. It’s basically Robin Hood in reverse.
All’s Not Wells That Ends Wells
Wells Fargo announced on Feb. 12 that it will allow workers who allege sexual harassment to bring their claims in court instead of forcing them into arbitration. It’s a step in the right direction, but the troubled megabank continues to force arbitration on workers with claims related to race or gender discrimination. Wells Fargo should dispense with all of its forced arbitration clauses for both customers and workers. But this is Wells Fargo we’re talking about, so don’t hold your breath.
More than 80% of both Republicans and Democrats support ending forced arbitration, and surprisingly, the percentage of support is higher among Republicans than Democrats.
Senators should listen to their constituents and protect consumers, workers and small businesses from getting ripped off by passing the Forced Arbitration Injustice Repeal (FAIR) Act.
We’ll continue fighting every day to protect people from forced arbitration until Congress acts.