Demand Progress

There is a legal loophole that lets sexual predators, discriminatory employers, and predatory lenders of student loans¹ off the hook.

Big corporations are increasingly requiring private forced arbitration as a condition of buying a product or a service, depriving all of these people from their right to have their day in court.

Congress could end this practice right now by passing the Forced Arbitration Injustice Repeal (FAIR) Act², but they won’t do it without pressure from Demand Progress members like you.

Tell Congress to end forced arbitration in employment, consumer, and civil rights cases by passing the FAIR Act.

An 87-year-old nun was raped in her nursing home, but her family was barred from suing the nursing home for negligence.³ A woman was charged a 1,000 percent interest rate (yes, you read that right) from a payday lender who illegally auto-renewed her loan--but she also was blocked from suing.⁴ Wells Fargo opened over 3 million fake accounts in customers’ names, but these customers were also blocked from court because of forced arbitration.⁵

Private arbitration is a rigged system. In arbitration, there is no judge, jury or right to an appeal.⁶

Arbitrators do not have to follow the law or care about facts and have an incentive to favor the company that can give them repeat business.⁷

Forced arbitration allows corporations to keep wrongdoing secret and avoid accountability for harming thousands or even millions of people.⁸

Forced arbitration can cost thousands of dollars. In the end, the loser (usually the individual, not the corporation) often pays the company’s legal fees.⁹

Forced arbitration strips our most basic rights. The laws that protect us from discrimination based on age, sex, religion, race, disability, and unequal pay for equal work, such as the Civil Rights Act and the Equal Pay Act, become meaningless in arbitration.

Employees who have been harmed by sexual harassment or assault,¹⁰ victims of predatory for-profit student loans, victims of negligence, defective products or scams should not be forced into arbitration. 

It’s time for Congress to restore our basic rights, but they won’t act without pressure from the grassroots.

Sources:

1. Public Citizen report, “Between a Rock and a Hard Place: Courthouse Doors Shut for Aggrieved Private Student Loan Borrowers,” July 2012.
2. Vox, “Google employees walked out for the right to sue their bosses. Now they’re taking the fight to Congress,” February 28, 2019.
3. Time, “An 87-Year-Old Nun Said She Was Raped in Her Nursing Home. Here’s Why She Couldn't Sue,” November 16, 2017.
4. Slate, “Forced Arbitration Is Unjust and Deeply Unpopular. Can Congress End It?” March 1, 2019.
5. Economic Policy Institute, “Forced arbitration is bad for consumers,” October 2, 2017.
6. Slate, “Forced Arbitration Is Unjust and Deeply Unpopular. Can Congress End It?” March 1, 2019.
7. Ibid.
8. Ibid.
9. Fair Arbitration Now Coalition, “What is Forced Arbitration?” Accessed June 19, 2019.
10. Vox, “Google employees walked out for the right to sue their bosses. Now they’re taking the fight to Congress,” February 28, 2019.