The letter noted that federal law has protected arbitration since 1925 as an effective means of resolving disputes between businesses, consumers, and employees. The FAIR Act “will not benefit claimants and will instead produce more class action lawsuits that will benefit the lawyers who bring them.”
Senior Labor and Employment Counsel Roger King recently testified before Congress on the issue of arbitration agreements and the FAIR Act, urging Congress to oppose the bill and citing the many positive attributes of arbitration and alternative dispute procedures, including efficiency, specialized adjudicators, and lower costs for all stakeholders. Mr. King advocated for a middle ground approach that would appropriately safeguard due process rights for claimants without banning the use of pre-dispute arbitration procedures entirely.
Outlook: A previous version of the FAIR Act passed the House in 2019 almost entirely along party lines. Given the Democratic majority in the House, it is very likely the FAIR Act would pass the House this session, but unlikely it will gain the 60 votes needed to pass the Senate. If the FAIR Act is unable to move through Congress, it is possible that President Biden would impose the ban on federal contractors through an executive order.
