Trial Magazine

Forced arbitration is everywhere, and it hurts everyone—including workers, consumers, patients, and nursing home residents. It also is used routinely to eliminate servicemembers’ rights under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA). Employers are increasingly using forced arbitration clauses in employment contracts and employee handbooks. These provisions are presented on a take-it-or-leave-it basis and eliminate individuals’ rights before a dispute has even arisen.

Take the case of Kevin Ziober, a U.S. Navy reservist whose employer fired him just hours after throwing him a going-away party before his imminent deployment to Afghanistan.¹ Ziober sued his employer, arguing that the company violated USERRA by terminating him for fulfilling his military service. His employer, however, tried to force him into arbitration.

Ziober fought all the way to the Ninth Circuit, but the court ruled against him, and he was ultimately unable to have his day in court. Because USERRA has not always been interpreted to guarantee servicemembers access to the courts, a stronger legislative stance is needed. Judge Paul Watford, in his concurring opinion in Ziober, appeared to urge Congress to consider changing or strengthening USERRA, writing, “If we have erred by construing [USERRA] too narrowly, Congress will surely let us know.”²

Ziober then filed a petition for certiorari with the U.S. Supreme Court. Six senators and 13 representatives, including three Republicans, filed an amicus brief asking the Court to overturn the Ninth Circuit’s ruling,³ but the Court declined to hear Ziober’s appeal.⁴

A Congressional Fix

Ziober’s case is only one example of the harm caused by employers, banks, and other corporations that have been quietly stripping away our constitutional and statutory rights—including those of servicemembers and their families.⁵ In response, AAJ has been relentlessly working toward ending the practice of forced arbitration for everyone by raising awareness of legislation to protect individuals’ right to trial.

Since Sen. Russell Feingold (D-Wis.) first introduced the “Arbitration Fairness Act of 2007,” there have been numerous iterations of that legislation. The most recent version, introduced in March 2017, currently has 26 Senate cosponsors and would make forced arbitration clauses unenforceable in civil rights, antitrust, consumer, and employment disputes.

Another bill specifically addresses the hurdles that servicemembers face under current court interpretations of USERRA. Sen. Richard Blumenthal (D-Conn.) and Rep. David Cicilline (D-R.I.) are the primary sponsors of the “Justice for Service Members Act,” a bill that would restore the rights of servicemembers to bring USERRA claims against their employers in federal court instead of arbitration. Forced arbitration limits servicemembers’ right to discovery of key documents and provides no right to appeal. This bill gives ­servicemembers the ability to pursue their cases in court while preserving the option to enter into an arbitration ­agreement after a dispute arises.

The bill, which attracted bipartisan cosponsors, had a June 2017 hearing in the House Committee on Veterans’ Affairs Subcommittee on Economic Opportunity. Rep. Cicilline testified in strong support of the bill, outlining how USERRA’s legislative history indicates that it was designed to protect veterans’ rights and preempt any employer “agreement” or contract that provides fewer rights or otherwise limits those rights—such as with forced arbitration.

The Reserve Officers Association and the Paralyzed Veterans of America also spoke in favor of the bill, and it is supported by The Military Coalition, a consortium of uniformed services and veterans associations representing more than 5 million current and former ­servicemembers and their families.⁶

Last year, members of Congress introduced in the House and the Senate the “Restoring Statutory Rights and Interests of the States Act.” This bill would ensure that forced arbitration clauses would not apply to claims based on violations of constitutional or statutory rights, such as fundamental civil rights claims, ensuring that all Americans have the right to seek justice under those critical laws.

The Tide Is Turning

While these bills have massive opposi­tion, the tide is slowly turning. The public’s awareness of forced arbitration has grown immensely over the last decade—so much so that congressional members from both sides of the aisle have taken notice.⁷

Despite the Supreme Court’s disappointing decision to deny his cert petition, Ziober’s case shone a light on the issue of forced arbitration in the USERRA context—and he has become a tireless advocate.

Legislative action is a crucial part of solving the problem, and AAJ will continue to fight for laws that ensure ­servicemembers’ rights to uphold their USERRA protections in court. We will pursue all opportunities to share your clients’ stories with members of Congress, as they are vital to our efforts. The fight to protect our servicemembers and veterans from forced arbitration is far from over—and with your help, we can continue to build momentum for this legislation.

Charlotte McBirney is the federal relations counsel for AAJ Public Affairs. She can be reached at charlotte.mcbirney@justice.org.

Notes

1. For more on the legal arguments in these cases, see p. 36. 
2. Ziober v. BLB Res., Inc., 839 F.3d 814, 823 (9th Cir. 2016). 
3. Brief of Members of Congress as Amici Curiae in Support of Petitioner, Ziober v. BLB Res., Inc., No. 16-1269 (U.S. May 24, 2017).
4. Ziober, cert. denied, 137 S. Ct. 2274 (2017).
5. The Am. Legion, Legion Calls on Trump to Veto Measure That Strips Servicemembers and Veterans of Vital Financial Protections (Oct. 26, 2017), www.legion.org/legislative/239750/legion-calls-trump-veto-measure-strips-servicemembers-and-veterans-vital. 
6. For more information about The Military Coalition, visit www.themilitarycoalition.org.
7. Sylvan Lane, GOP Polling Firm: Bipartisan Support for Consumer Bureau Arbitration Rule, The Hill (Oct. 5, 2017), http://thehill.com/policy/finance/354143-gop-polling-firm-finds-bipartisan-support-for-consumer-bureau-arbitration-rule.