Employment Arbitration Reform: Preserving the Right to Class Proceedings in Workplace Disputes

Abstract

The recent judicial enforcement of class waivers in arbitration agreements has generated ample debate over the exact reach of these decisions and their effects on the future of collective action for consumers and employees. In AT&T Mobility v. Concepcion, a 5-4 majority of the Supreme Court majority held that the Federal Arbitration Act (FAA) preempted state laws prohibiting companies from incorporating class action waivers into arbitration agreements. The Court upheld such waivers on the grounds that they are consistent with the language and underlying purpose of the FAA. Most courts across the country have since reinforced the strong federal policy favoring arbitration. This, in turn, has made it more difficult for employees—most of whom do not enjoy the benefit of union representation and must therefore arbitrate their claims as individuals—from engaging in class proceedings. Faced with this dire judicial landscape, employees must turn to Congress to limit the scope of compulsory arbitration and secure recognition of the right to class proceedings. This Note advocates for legislative reform of federal arbitration law. Specifically, it argues for an amendment to the FAA that invalidates class waivers in mandatory arbitration agreements and applies only in employment disputes. Such a reform would help preserve important employee protections under federal labor law and would allow nonunion workers, in particular, to fully exercise their fundamental right to collective action.