What’s Next for Forced Arbitration? Where We Go After SCOTUS Decision in Epic Systems

Advocates know that it is difficult to understate the devastating effect Epic Systems will have on workers’ rights. The Supreme Court has sided with bosses and allowed individual arbitration – without class or collective actions – to become the norm. Workers’ groups across the country are demanding a comprehensive federal fix, while the increased public attention leading up to the case has led to new research as well as new state and federal legislative efforts.  

New Research Shows How Far the Problem Goes 

New research from the Economic Policy Institute shows that in recent years, forced arbitration in employment has become extremely common. More than 60 million workers are now subject to forced arbitration as a condition of employment. Since the early 2000s, the share of workers employed in the private non-union sector subject to mandatory arbitration has more than doubled and now exceeds 55 percent. In other words, in the private non-union sector, it’s now more common to be subject to forced arbitration than it is to have access to the courts.  

Unsurprisingly, the study finds that large employers are more likely to require forced arbitration clauses. These clauses are also more common in low-wage workplaces, meaning they are more common in industries that are disproportionately composed of women and African Americans. The study also looks at geography and finds that forced arbitration is particularly widespread in California, Texas, and North Carolina. Read more here.  

New Legislative Efforts at the State and Federal level   

In New York State, advocates like Make the Road and the Center for Popular Democracy are supporting the EMPIRE bill, a bill modeled on California’s Private Attorneys General Act (PAGA). Vermont advocates are also promoting a PAGA-style bill that would cover workers, consumers, and nursing homes. Last year’s legislative session in Vermont considered a bill that would require arbitrators to disclose data and make certain punitive provisions, like venue or shortened statute of limitations, unconscionable under state law. This year’s bill goes further.  

Following the #MeToo movement, several states have also considered or enacted bills addressing forced arbitration in relation to sexual harassment claims, including South Carolina and New York.  

Advocates are also considering other legislative options, such as bills that require companies to make certain disclosures, including the number of cases filed and the prevailing parties; or bills that modify government procurement rules as to companies that use forced arbitration. A report from the New York City Public Advocate outlines some of these ideas.  

Finally, at the federal level, Senator Kirsten Gillibrand of New York has introduced the Ending Forced Arbitration of Sexual Harassment Act, with Gretchen Carlson as a prominent spokesperson supporting the bill. The bill would prohibit pre-dispute arbitration agreements as to sex discrimination disputes. The Arbitration Fairness Act, introduced by Senator Richard Blumenthal of Connecticut, is much broader and would prohibit pre-dispute arbitration agreements that require arbitration of employment, consumer, antitrust, or civil rights disputes.  

NELP continues to convene allies around this issue and contribute to public engagement and education. We are collaborating with the Center for Popular Democracy and other groups on advancing these bills. If you have any tips or suggestions on areas for further engagement or research, please contact us at cgao@nelp.org.