This week, Congressman Hank Johnson from Atlanta, Georgia will introduce the Arbitration Fairness Act of 2009. This is an act which would prohibit mandatory arbitration clauses in consumer, employment and franchisee contracts. Businesses have long touted arbitration as a cheaper and more expeditous alternative to a trial by jury. Even if that were true, which it’s not, why not have your case heard by a judge, whose salary you are already paying with your tax dollars anyway? The decision maker’s cost is only the cost of a filing fee. And as for claims moving faster in arbitration and being cheaper to prosecute – do not bet on it. In our experience, defendants attempt to draw out arbitrations just like they do any other jury or non-jury matter.
Also, arbitrators are generally not neutral decision makers. The prevailing view by lawyers who handle arbitration – lawyers on both sides of the fence – is that arbitration association decisions typically favor industry. I can point you to the personal web page of a lawyer in a large, prominent Alabama firm who touts his success in arbitrations “even in an industry that is known for ‘splitting the baby’.”
Mandatory arbitration is especially unconscionable in employment contracts. Workers have so few rights to start with, requiring mandatory arbitration for those rights that they do have is just plain wrong. The unequal bargaining power held by employers, especially in this economic climate, makes it clear that such agreements are not made voluntarily (at least by the employee) or at arms length.
One of the worse aspects of arbitration is the negative effect that it has on the development of law. In our legal system, particular points of law are developed over time by one appellate court considering what another trial or appellant court has done. Arbitration is all done by behind closed doors. Arbitrators do not have to issue an opinion stating how they came to the conclusion they did and the grounds for an appeal of an arbitrator’s award are extremely narrow, at best.
Please write and call your congressman today. Let them know how this is impacting your job or your life. Let them know what the right to a trial by jury means to you. To me, it is one of the basic underpinnings of a free society.
Cum Laude graduate of Cumberland School of Law, Pet Mackey is a civil trial litigation expert who represents plaintiffs in business and consumer tort, contracts and construction, employment disputes and insurance. He is board certified as a Civil Trial Advocate by the National Board of Trial Advocacy, a Certified Alabama Mediator, and an “AV” rated lawyer by Martindale-Hubbell.