Availability of Class Actions in Arbitration, Part 1

Some rights given by law can’t be given up, even if someone agrees to give them up. The Supreme Court said that the law to protect workers from low wages can’t be waived. This means that workers can’t agree to not get the wages they’re supposed to. The Supreme Court also said that workers can’t agree to not get extra money for not getting the right wages. Some courts have said that workers can’t agree not to bring a big lawsuit with other workers. But not all courts agree on this. Class-action waivers can sometimes be enforced, despite the federal policy favoring class actions. The policy supports using class actions to help people who might not otherwise be able to afford a lawsuit. This system also gives lawyers a financial incentive to take on these cases. So, while class-action waivers aren’t always enforceable, there are situations where they can be. Class-action lawsuits can help people save money on legal fees because the costs can be spread out among all the people in the group. This makes it possible for people with smaller claims to find a lawyer who will work for them. However, when it comes to arbitration, the law strongly supports agreements to settle disputes through arbitration. On the other hand, class actions can be helpful in providing justice for a large group of people who have suffered harm. Class action lawsuits allow people with small claims to band together and make a larger claim worth pursuing. The Supreme Court has made it clear that class actions are allowed in arbitration, and arbitration agencies have developed rules for handling them. This makes it easier for people to seek justice when they have been wronged. In the Bazzle case, the Supreme Court decided that when it comes to arbitrations, the person making the decision (the arbitrator) should interpret the rules about whether a group of people can bring a case together (class arbitration). It also seems like the court thinks that the parties can decide to not allow class arbitrations in their agreement. So, in this case, the arbitrator gets to decide if the case can be a class arbitration or not. The court found that a clause in a credit card agreement that prevented customers from banding together to sue the company was unfair and against the law. The court said that this clause was one-sided and didn’t give any benefit to the customers. They also said it went against the state’s policy of stopping unfair business practices. The court ordered the clause to be removed from the agreement, but the rest of the agreement still stood. In the case Discover Bank v. Superior Court of Los Angeles, the court had to decide if a company could force a customer to go to arbitration instead of being part of a class action lawsuit. The court said that in some cases, class action waivers in contracts are not allowed in California. The court looked at different reasons, like how it can be hard for individual people to sue a big company and how class actions can help stop companies from doing bad things. Another court case, Kristian v. Comcast Corp., also said that a company couldn’t force people into arbitration if their claims were too small to sue individually. And in Powertell, Inc. v. Bexley, the court said that an arbitration clause in a contract can be canceled if it’s unfair to the customer. So overall, it seems like the law is leaning towards not allowing companies to force people into arbitration if it’s not fair to the customer. There are laws that allow people to sue their employers for things like discrimination and not getting paid enough. But sometimes, employers make their workers sign a paper saying they won’t sue. This article is talking about whether those papers are always valid. It seems like they might not be if the amount of money the worker is owed is really small. There are some cases where courts have said the papers are valid, but there are also cases where they said they’re not. So, it’s a little bit complicated and we’ll have to wait and see what happens in the future. Contracts of adhesion are standard form contracts where one party gives the other party little to no room for negotiation. The party who creates the contract does so for many similar transactions and presents it as the only option. These contracts are often one-sided and can be unfair to the party who didn’t create it. In some states, like Florida, laws protect consumers from being forced into these types of contracts. This article was written by a lawyer who has been practicing labor and employment law for over 30 years. He now works as a mediator and arbitrator. The article was submitted on behalf of a section of lawyers who focus on labor and employment law. Their goal is to teach their members about duty and serving the public, improve how justice is carried out, and advance the science of law.

Source: https://www.floridabar.org/the-florida-bar-journal/availability-of-class-actions-in-arbitration-part-1/