Forced Arbitration Injustice Repeal Act

II 117TH CONGRESS 1ST SESSION S. 505 To amend title 9 of the United States Code with respect to arbitration. IN THE SENATE OF THE UNITED STATES MARCH 1, 2021 Mr. BLUMENTHAL (for himself, Mr. MARKEY, Mr. SCHATZ, Mr. WHITE- HOUSE, Mr. BROWN, Mr. WYDEN, Mr. MERKLEY, Ms. HIRONO, Mr. CASEY, Ms. WARREN, Mr. BOOKER, Mr. LEAHY, Mr. MENENDEZ, Ms. CANTWELL, Ms. CORTEZ MASTO, Mr. MURPHY, Ms. ROSEN, Mr. REED, Mr. DURBIN, Mr. VAN HOLLEN, Mrs. GILLIBRAND, Mr. COONS, Ms. BALDWIN, Ms. KLOBUCHAR, Mr. HEINRICH, Ms. SMITH, Mrs. FEIN- STEIN, Ms. DUCKWORTH, Mrs. SHAHEEN, Mr. CARPER, Ms. HASSAN, Mr. PETERS, Mr. BENNET, Mr. KAINE, Mr. SANDERS, Mr. PADILLA, Mrs. MURRAY, Mr. LUJA´N, Mr. WARNOCK, and Mr. OSSOFF) introduced the following bill; which was read twice and referred to the Committee on the Judiciary A BILL To amend title 9 of the United States Code with respect to arbitration. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Forced Arbitration In- 4 justice Repeal Act’’. 5 VerDate Sep 11 2014 00:19 Mar 31, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S505.IS S505 pbinns on DSKJLVW7X2PROD with BILLS 2 •S 505 IS SEC. 2. PURPOSES. 1 The purposes of this Act are to— 2 (1) prohibit predispute arbitration agreements 3 that force arbitration of future employment, con- 4 sumer, antitrust, or civil rights disputes; and 5 (2) prohibit agreements and practices that 6 interfere with the right of individuals, workers, and 7 small businesses to participate in a joint, class, or 8 collective action related to an employment, con- 9 sumer, antitrust, or civil rights dispute. 10 SEC. 3. ARBITRATION OF EMPLOYMENT, CONSUMER, ANTI- 11 TRUST, AND CIVIL RIGHTS DISPUTES. 12 (a) IN GENERAL.—Title 9 of the United States Code 13 is amended by adding at the end the following: 14 ‘‘CHAPTER 4—ARBITRATION OF EMPLOY- 15 MENT, CONSUMER, ANTITRUST, AND 16 CIVIL RIGHTS DISPUTES 17 ‘‘Sec. ‘‘401. Definitions. ‘‘402. No validity or enforceability. ‘‘§ 401. Definitions 18 ‘‘In this chapter— 19 ‘‘(1) the term ‘antitrust dispute’ means a dis- 20 pute— 21 ‘‘(A) arising from an alleged violation of 22 the antitrust laws (as defined in subsection (a) 23 VerDate Sep 11 2014 00:19 Mar 31, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S505.IS S505 pbinns on DSKJLVW7X2PROD with BILLS 3 •S 505 IS of the first section of the Clayton Act (15 1 U.S.C. 12(a)) or State antitrust laws; and 2 ‘‘(B) in which the plaintiffs seek certifi- 3 cation as a class under rule 23 of the Federal 4 Rules of Civil Procedure or a comparable rule 5 or provision of State law; 6 ‘‘(2) the term ‘civil rights dispute’ means a dis- 7 pute— 8 ‘‘(A) arising from an alleged violation of— 9 ‘‘(i) the Constitution of the United 10 States or the constitution of a State; or 11 ‘‘(ii) any Federal, State, or local law 12 that prohibits discrimination on the basis 13 of race, sex, age, gender identity, sexual 14 orientation, disability, religion, national or- 15 igin, or any legally protected status in edu- 16 cation, employment, credit, housing, public 17 accommodations and facilities, voting, vet- 18 erans or servicemembers, health care, or a 19 program funded or conducted by the Fed- 20 eral Government or a State government, 21 including any law referred to or described 22 in section 62(e) of the Internal Revenue 23 Code of 1986, including parts of such law 24 not explicitly referenced in such section but 25 VerDate Sep 11 2014 00:19 Mar 31, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S505.IS S505 pbinns on DSKJLVW7X2PROD with BILLS 4 •S 505 IS that relate to protecting individuals on any 1 such basis; and 2 ‘‘(B) in which at least 1 party alleging a 3 violation described in subparagraph (A) is an 4 individual (or an authorized representative of 5 an individual), including an individual seeking 6 certification as a class under rule 23 of the 7 Federal Rules of Civil Procedure or a com- 8 parable rule or provision of State law; 9 ‘‘(3) the term ‘consumer dispute’ means a dis- 10 pute between— 11 ‘‘(A) 1 or more individuals, including an 12 individual who seeks certification as a class 13 under rule 23 of the Federal Rules of Civil Pro- 14 cedure or a comparable rule or provision of 15 State law, who seek or acquire real or personal 16 property, services (including services related to 17 digital technology), securities or other invest- 18 ments, money, or credit for personal, family, or 19 household purposes; and 20 ‘‘(B)(i) the seller or provider of such prop- 21 erty, services, securities or other investments, 22 money, or credit; or 23 ‘‘(ii) a third party involved in the selling, 24 providing of, payment for, receipt or use of in- 25 VerDate Sep 11 2014 00:19 Mar 31, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S505.IS S505 pbinns on DSKJLVW7X2PROD with BILLS 5 •S 505 IS formation about, or other relationship to any 1 such property, services, securities or other in- 2 vestments, money, or credit; 3 ‘‘(4) the term ‘employment dispute’— 4 ‘‘(A) means a dispute between 1 or more 5 individuals (or their authorized representative) 6 and a person arising out of or related to the 7 work relationship or prospective work relation- 8 ship between them, including a dispute regard- 9 ing the terms of or payment for, advertising of, 10 recruiting for, referring of, arranging for, or 11 discipline or discharge in connection with, such 12 work, regardless of whether the individual is or 13 would be classified as an employee or an inde- 14 pendent contractor with respect to such work; 15 and 16 ‘‘(B) includes— 17 ‘‘(i) a dispute arising under any law 18 referred to or described in section 62(e) of 19 the Internal Revenue Code of 1986, includ- 20 ing parts of such law not explicitly ref- 21 erenced in such section but that relate to 22 protecting individuals on any such basis; 23 and 24 VerDate Sep 11 2014 00:19 Mar 31, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S505.IS S505 pbinns on DSKJLVW7X2PROD with BILLS 6 •S 505 IS ‘‘(ii) a dispute in which an individual 1 seeks certification as a class under rule 23 2 of the Federal Rules of Civil Procedure or 3 as a collective action under section 16(b) 4 of the Fair Labor Standards Act (29 5 U.S.C. 216(b)), or a comparable rule or 6 provision of State law; 7 ‘‘(5) the term ‘predispute arbitration agree- 8 ment’ means an agreement to arbitrate a dispute 9 that has not yet arisen at the time of the making 10 of the agreement; and 11 ‘‘(6) the term ‘predispute joint-action waiver’ 12 means an agreement, whether or not part of a 13 predispute arbitration agreement, that would pro- 14 hibit, or waive the right of, one of the parties to the 15 agreement to participate in a joint, class, or collec- 16 tive action in a judicial, arbitral, administrative, or 17 other forum, concerning a dispute that has not yet 18 arisen at the time of the making of the agreement. 19 ‘‘§ 402. No validity or enforceability 20 ‘‘(a) IN GENERAL.—Notwithstanding any other pro- 21 vision of this title, no predispute arbitration agreement or 22 predispute joint-action waiver shall be valid or enforceable 23 with respect to an employment dispute, consumer dispute, 24 antitrust dispute, or civil rights dispute. 25 VerDate Sep 11 2014 00:19 Mar 31, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S505.IS S505 pbinns on DSKJLVW7X2PROD with BILLS 7 •S 505 IS ‘‘(b) APPLICABILITY.— 1 ‘‘(1) IN GENERAL.—An issue as to whether this 2 chapter applies with respect to a dispute shall be de- 3 termined under Federal law. The applicability of this 4 chapter to an agreement to arbitrate and the validity 5 and enforceability of an agreement to which this 6 chapter applies shall be determined by a court, rath- 7 er than an arbitrator, irrespective of whether the 8 party resisting arbitration challenges the arbitration 9 agreement specifically or in conjunction with other 10 terms of the contract containing such agreement, 11 and irrespective of whether the agreement purports 12 to delegate such determinations to an arbitrator. 13 ‘‘(2) COLLECTIVE BARGAINING AGREEMENTS.— 14 Nothing in this chapter shall apply to any arbitra- 15 tion provision in a contract between an employer and 16 a labor organization or between labor organizations, 17 except that no such arbitration provision shall have 18 the effect of waiving the right of a worker to seek 19 judicial enforcement of a right arising under a provi- 20 sion of the Constitution of the United States, a 21 State constitution, or a Federal or State statute, or 22 public policy arising therefrom.’’. 23 (b) TECHNICAL AND CONFORMING AMENDMENTS.— 24 VerDate Sep 11 2014 00:19 Mar 31, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S505.IS S505 pbinns on DSKJLVW7X2PROD with BILLS 8 •S 505 IS (1) IN GENERAL.—Title 9 of the United States 1 Code is amended— 2 (A) in section 1, by striking ‘‘of seamen,’’ 3 and all that follows through ‘‘interstate com- 4 merce’’ and inserting ‘‘of individuals, regardless 5 of whether the individuals are designated as 6 employees or independent contractors for other 7 purposes’’; 8 (B) in section 2, by inserting ‘‘or as other- 9 wise provided in chapter 4’’ before the period at 10 the end; 11 (C) in section 208— 12 (i) in the section heading, by striking 13 ‘‘CHAPTER 1; RESIDUAL APPLICA- 14 TION’’ and inserting ‘‘APPLICATION’’; 15 and 16 (ii) by adding at the end the fol- 17 lowing: ‘‘This chapter applies to the extent 18 that this chapter is not in conflict with 19 chapter 4.’’; and 20 (D) in section 307— 21 (i) in the section heading, by striking 22 ‘‘CHAPTER 1; RESIDUAL APPLICA- 23 TION’’ and inserting ‘‘APPLICATION’’; 24 and 25 VerDate Sep 11 2014 00:19 Mar 31, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S505.IS S505 pbinns on DSKJLVW7X2PROD with BILLS 9 •S 505 IS (ii) by adding at the end the fol- 1 lowing: ‘‘This chapter applies to the extent 2 that this chapter is not in conflict with 3 chapter 4.’’. 4 (2) TABLE OF SECTIONS.— 5 (A) CHAPTER 2.—The table of sections for 6 chapter 2 of title 9, United States Code, is 7 amended by striking the item relating to section 8 208 and inserting the following: 9 ‘‘208. Application.’’. (B) CHAPTER 3.—The table of sections for 10 chapter 3 of title 9, United States Code, is 11 amended by striking the item relating to section 12 307 and inserting the following: 13 ‘‘307. Application.’’. (3) TABLE OF CHAPTERS.—The table for chap- 14 ters of title 9, United States Code, is amended by 15 adding at the end the following: 16 ‘‘4. Arbitration of employment, consumer, antitrust, and civil rights disputes .............................................. 401’’. SEC. 4. EFFECTIVE DATE. 17 This Act, and the amendments made by this Act, 18 shall take effect on the date of enactment of this Act and 19 shall apply with respect to any dispute or claim that arises 20 or accrues on or after such date. 21 Æ VerDate Sep 11 2014 00:19 Mar 31, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6301 E:\BILLS\S505.IS S505 pbinns on DSKJLVW7X2PROD with BILLS