Opening the Door to Justice: Amending the Federal Arbitration Act to Remedy the Unjust Use of Predispute Arbitration Agreements

Abstract:     
This paper assesses the Arbitration Fairness Act’s proposed amendments to the Federal Arbitration Act, as well as the possibility of contracting for heightened judicial review of arbitration awards. In brief, I support the amendments as well as the possibility of review.

Section 2(b) of the AFA would prohibit the enforcement of predispute arbitration agreements that require arbitration of employment, consumer, or franchise disputes or disputes arising under any statute intended to protect civil rights. I demonstrate why the prevailing practice of summarily enforcing predispute arbitration agreements is unjust in these contexts, and why Congressional amendment, rather than State law or contract-based remedies, is necessary to fix the problem. Section 2(c) of the AFA would render the validity and enforceability of arbitration agreements subject to the determination of the court rather than an arbitrator. I claim the doctrine of separability and the distinction between substantive and procedural arbitrability should be abolished, and that this amendment does so. Lastly, parties should be free to contract for heightened judicial review of arbitration awards. If neither amendment is feasible, improvements in the world of arbitration could still be attained by relaxing the currently severe restraints on arbitral review.

Number of Pages in PDF File: 12

working papers series