Law Offices of Lauren Abrams blog

U.S. Supreme Court Decision Will Embolden Companies to Flout Workplace Laws

(San Francisco, CA) - Terisa E. Chaw, Executive Director of the National Employment Lawyers Association (NELA), issued the following statement on today's 5-3 decision by the U.S. Supreme Court in American Express Co. v. Italian Colors Restaurant (Case No. 12-133) eliminating the ability of small businesses to join together to vindicate their statutory rights under antitrust laws in arbitration:

"Today the U.S. Supreme Court, as Justice Kagan wrote in dissent, 'betray[ed]' decades of its own caselaw and gave a pass to big businesses when they violate our nation's laws. The family who owned Italian Colors Restaurant was forced to accept American Express' arbitration clause in order to transact credit card payments. By allowing large corporations to use forced arbitration clauses to prevent small businesses from enforcing their rights under the antitrust laws, a narrow majority of the Supreme Court has 'insulated wrongdoers from liability.' Forced arbitration is anathema to our public justice system and is being used by companies to trump substantive legal rights.

Like the family who owns Italian Colors, millions of employees-from minimum wage workers to service members to highly compensated executives-are being forced to submit to pre-dispute binding arbitration to get or keep their jobs. This decision by a divided Court will give companies license to try to deny their workers access to our country's civil justice system when they violate our nation's employment and civil rights laws. Congress never intended the Federal Arbitration Act (FAA) to be used against America's workers or to invalidate their substantive legal rights.

The National Employment Lawyers Association calls upon Congress to enact the Arbitration Fairness Act (AFA) of 2013 (S. 878/H.R. 1844). The AFA would amend the FAA by making it unlawful for employers to impose arbitration on employees except when knowingly and voluntarily agreed to after the dispute arises or pursuant to a collective bargaining agreement."

For more information on What's Wrong With Forced Arbitration, visit the NELA website at: www.nela.org/forcedarbitration.

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