On April 29 — a/k/a “Arbitration Fairness Day” – – Senator Russ Feingold (D-WI) introduced the Senate’s version of the Arbitration Fairness Act of 2009 (S. 931). The Senate’s version tracks the House version in many respects, but there are some important differences between the two.
The Senate Arbitration Fairness Act adds a Chapter 4 to the Federal Arbitration Act, rather than amending Section 2 of Chapter 1. This Proposed Chapter 4 consists of two sections: Section 401, entitled “Definitions”; and Section 402, entitled “Validity and Enforceability.” Proposed Section 402(a) states: “In General – Notwithstanding any other provision of this title, no predispute arbitration agreement shall be valid or enforceable if it requires arbitration of an employment, consumer, franchise, or civil rights dispute.” Proposed Section 402(b) provides:
(1) IN GENERAL – An issue as to whether this chapter applies to an arbitration agreement shall be determined under Federal law. The applicability of this chapter to an agreement to arbitrate and the validity and enforceability of an agreement to arbitrate to which this chapter applies shall be determined by the court, rather than the arbitrator, irrespective of whether the party resisting arbitration challenges the arbitration agreement specifically or in conjunction with other terms of the contract containing such agreement.
(2) COLLECTIVE BARGAINING AGREEMENTS – Nothing in this chapter shall apply to any arbitration provision in a contract between an employer and a labor organization or between labor organizations, except that no such arbitration provision shall have the effect of waiving the right of an employee to seek judicial enforcement of a right arising under a provision of the Constitution of the United States, a State constitution, or a Federal or State statute, or public policy arising therefrom. Continue Reading »
