Arbitration Reform

The bill:

• Prohibits a provision in an arbitration agreement that waives a party's ability to participate in a representative action except as preempted by federal law and disallows the waiver of this prohibition;
• Prohibits a provision in an arbitration agreement that requires an employee to an employer and employee contract or a consumer to a merchant and consumer contract to pay fees that substantially exceed the costs required to file a claim in state or federal court, except as preempted by federal law, and disallows the waiver of this prohibition;
• Prohibits an individual from serving as an arbitrator if the individual has a rule, policy, procedure, or demonstrated pattern of conduct that discriminates or prevents, or has the effect of discriminating or preventing, a certain party or type of party from asserting their rights or prevailing in arbitration or that discriminates against an attorney; and
• Requires an employer or merchant to fully comply with requirements of a record of an award, within 30 days after the date of the record of an award, or be liable for additional damages caused by their failure to comply.

Under current law, exemplary damages are prohibited in arbitration proceedings. The bill repeals this prohibition.

(Note: This summary applies to this bill as introduced.)