Arbitration clauses are ubiquitous in consumer and employment contracts. Frustrated with that widespread use, on October 30, United States House of Representatives members Jerrold Nadler (D-N.Y.) and Bobby Scott (D-Va.) introduced the “Restoring Justice for Workers Act.” The proposed legislation would outlaw use of class action waiver provisions in employment contracts and bar agreements that require future employment disputes to be arbitrated, giving workers greater leeway to pursue work-related claims in court.
The proposed legislation comes in response to the U.S. Supreme Court’s ruling in Epic Systems Corp. v. Lewis, 138 S. Ct. 1612 (2018). In Lewis, the Court held that employers did not violate the National Labor Relations Act by including class waiver provisions in arbitration agreements that workers were required to sign as a condition of their employment. The proposed bill would amend the Federal Arbitration Act and the National Labor Relations Act to ensure that disputes between employers and workers can be resolved in court and ensure that workers can band together in class or collective actions.
No action has yet been taken on the proposed legislation. Troutman Sanders will continue to monitor and report on these legislative developments.