HB 2975: Mandating the Removal of Mandatory Arbitration

Post Authored by Teresa Becvar

Forced arbitration may soon be on the chopping block in Illinois. Proposed legislation HB 2975, which passed the Illinois House of Representatives, states that an employer may not require an employee to waive, arbitrate, or otherwise diminish any future claim, right, or benefit to which a person is entitled under state or federal law as a condition of employment. This proposed legislation would create blanket protection for workers without diminishing employers’ rights to enter into arbitration agreements with their employees–assuming all parties consent.

In the last few years, the use of mandatory arbitration agreements by employers has increased exponentially. Consistent with the nationwide trend, it is estimated that millions of Illinois employees–perhaps as many as 60% of those employed by large, private-sector employers–are subject to such agreements. It should come as no surprise that employers prefer to resolve employment disputes brought by employees at arbitration rather than court. Arbitration proceedings take place in a private setting with no judge, no jury, and virtually no chance of appeal–in other words, it completely deprives employees of their fundamental right to access the judicial system.

Claims ranging from sexual harassment, racial discrimination, and failure to pay minimum wage are funneled into a private forum where justice is doled out by an “arbitrator” who is not bound by legal precedent, established rules of procedure or evidence, or public scrutiny. Under such a system, employers are less motivated to maintain honest, safe, and compliant working conditions and practices, leaving workers vulnerable. While such agreements have been held enforceable, that does not mean employers should have free reign to force employees to sign away fundamental rights through an arbitration agreement as a mandatory condition of employment. In other words, employees should not have to choose between putting food on the table and surrendering their Constitutional and other statutory rights.

State legislatures have the power to enact worker protections if working conditions are harmed by a fundamental inequality in bargaining power between the employer and the employee. The proposed legislation places employers and employees on equal footing. While it does not prevent employers and employees from freely and voluntarily agreeing to resolve claims through arbitration, it does prevent employers from forcing employees–typically low-wage, hourly-paid workers–into making a “take it or leave it” choice between their rights and their livelihood. The bill also voids any contract that waives or limits an employee’s rights against the employer if employment was conditioned on signing the agreement. Employers would no longer coerce workers’ employment by limiting job offers to those willing to check their rights at the door. Legislation such as HB 2975 protects workers without limiting their employers’ rights and provides a balanced check on current arbitration trends.

About the Author:

teresa-m-becvarTeresa M. Becvar is a partner at Stephan Zouras, LLP, representing employees nationwide in wage and hour and employment discrimination class and collective actions. Teresa is a 2013 graduate of Chicago-Kent College of Law, where she served as Executive Articles Editor of the Law Review.  Teresa serves on the Advocacy Council Leadership Committee for Women Employed, an Illinois organization that advocates for the advancement of working women through fair workplaces and education opportunities.

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