We previously discussed the journey of the Franken Amendment through the halls of Congress. (The Amendment would prohibit the award of DOD funds to any Federal contractor that forces its employees or independent contractors to submit to pre-dispute binding arbitration of Title VII and sexual-assault tort claims.)
This weekend, the amendment was signed into law by President Obama. This means that most military contractors will no longer be able to enforce mandatory arbitration clauses in their employment contracts under a provision signed into law over the weekend.
The issue has been a high priority this year for trial lawyers and for consumer groups. When speaking candidly, most employment lawyers would agree that clauses mandating the use of arbitration deny employees an impartial hearing in open court. Supporters of forced arbitration argue that the process is both fair and efficient.
The open question is whether the passage of the Franken Amendment will lead to an effort next year by Congress to outlaw forced arbitration of civil rights claims throughout the private employment context.