II 

112TH CONGRESS 

1ST SESSION S. 987 

To amend title 9 of the United States Code with respect to arbitration. 

IN THE SENATE OF THE UNITED STATES 

MAY 12, 2011 

Mr. FRANKEN (for himself, Mr. BLUMENTHAL, Mr. LEAHY, Mr. DURBIN, Mr. 

WHITEHOUSE, Mr. BROWN of Ohio, Mr. HARKIN, Mr. KERRY, Mr. 

MERKLEY, Mr. UDALL of New Mexico, Mr. WYDEN, Mr. CASEY, and 

Mrs. BOXER) introduced the following bill; which was read twice and referred to the Committee on the Judiciary 

A BILL 

To amend title 9 of the United States Code with respect 

to arbitration. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Arbitration Fairness 

5 Act of 2011’’. 

6 SEC. 2. FINDINGS. 

7 The Congress finds the following: 

8 (1) The Federal Arbitration Act (now enacted 

9 as chapter 1 of title 9 of the United States Code) 


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1 was intended to apply to disputes between commer2 cial entities of generally similar sophistication and 

3 bargaining power. 

4 (2) A series of decisions by the Supreme Court 

5 of the United States have changed the meaning of 

6 the Act so that it now extends to consumer disputes 

7 and employment disputes. 

8 (3) Most consumers and employees have little 

9 or no meaningful choice whether to submit their 

10 claims to arbitration. Often, consumers and employ11 ees are not even aware that they have given up their 

12 rights. 

13 (4) Mandatory arbitration undermines the de14 velopment of public law because there is inadequate 

15 transparency and inadequate judicial review of arbi16 trators’ decisions. 

17 (5) Arbitration can be an acceptable alternative 

18 when consent to the arbitration is truly voluntary, 

19 and occurs after the dispute arises. 

20 SEC. 3. ARBITRATION OF EMPLOYMENT, CONSUMER, AND 

21 CIVIL RIGHTS DISPUTES. 

22 (a) IN GENERAL.—Title 9 of the United States Code 

23 is amended by adding at the end the following: 


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1 ‘‘CHAPTER 4—ARBITRATION OF EMPLOY2 MENT, CONSUMER, AND CIVIL RIGHTS 

3 DISPUTES 

‘‘Sec. 

‘‘401. Definitions. 

‘‘402. Validity and enforceability. 

4 ‘‘§ 401. Definitions 

5 ‘‘In this chapter— 

6 ‘‘(1) the term ‘civil rights dispute’ means a dis7 pute— 

8 ‘‘(A) arising under— 

9 ‘‘(i) the Constitution of the United 

10 States or the constitution of a State; or 

11 ‘‘(ii) a Federal or State statute that 

12 prohibits discrimination on the basis of 

13 race, sex, disability, religion, national ori14 gin, or any invidious basis in education, 

15 employment, credit, housing, public accom16 modations and facilities, voting, or pro17 gram funded or conducted by the Federal 

18 Government or State government, includ19 ing any statute enforced by the Civil 

20 Rights Division of the Department of Jus21 tice and any statute enumerated in section 

22 62(e) of the Internal Revenue Code of 

23 1986 (relating to unlawful discrimination); 

24 and 


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1 ‘‘(B) in which at least 1 party alleging a 

2 violation of the Constitution of the United 

3 States, a State constitution, or a statute pro4 hibiting discrimination is an individual; 

5 ‘‘(2) the term ‘consumer dispute’ means a dis6 pute between an individual who seeks or acquires 

7 real or personal property, services (including services 

8 relating to securities and other investments), money, 

9 or credit for personal, family, or household purposes 

10 and the seller or provider of such property, services, 

11 money, or credit; 

12 ‘‘(3) the term ‘employment dispute’ means a 

13 dispute between an employer and employee arising 

14 out of the relationship of employer and employee as 

15 defined in section 3 of the Fair Labor Standards 

16 Act of 1938 (29 U.S.C. 203); and 

17 ‘‘(4) the term ‘predispute arbitration agree18 ment’ means any agreement to arbitrate a dispute 

19 that had not yet arisen at the time of the making 

20 of the agreement. 

21 ‘‘§ 402. Validity and enforceability 

22 ‘‘(a) IN GENERAL.—Notwithstanding any other pro23 vision of this title, no predispute arbitration agreement 

24 shall be valid or enforceable if it requires arbitration of 


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1 an employment dispute, consumer dispute, or civil rights 

2 dispute. 

3 ‘‘(b) APPLICABILITY.— 

4 ‘‘(1) IN GENERAL.—An issue as to whether this 

5 chapter applies to an arbitration agreement shall be 

6 determined under Federal law. The applicability of 

7 this chapter to an agreement to arbitrate and the 

8 validity and enforceability of an agreement to which 

9 this chapter applies shall be determined by a court, 

10 rather than an arbitrator, irrespective of whether the 

11 party resisting arbitration challenges the arbitration 

12 agreement specifically or in conjunction with other 

13 terms of the contract containing such agreement. 

14 ‘‘(2) COLLECTIVE BARGAINING AGREEMENTS.— 

15 Nothing in this chapter shall apply to any arbitra16 tion provision in a contract between an employer and 

17 a labor organization or between labor organizations, 

18 except that no such arbitration provision shall have 

19 the effect of waiving the right of an employee to 

20 seek judicial enforcement of a right arising under a 

21 provision of the Constitution of the United States, a 

22 State constitution, or a Federal or State statute, or 

23 public policy arising therefrom.’’. 

24 (b) TECHNICAL AND CONFORMING AMENDMENTS.— 


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1 (1) IN GENERAL.—Title 9 of the United States 

2 Code is amended— 

3 (A) in section 1, by striking ‘‘of seamen,’’ 

4 and all that follows through ‘‘interstate com5 merce’’; 

6 (B) in section 2, by inserting ‘‘or as other7 wise provided in chapter 4’’ before the period at 

8 the end; 

9 (C) in section 208— 

10 (i) in the section heading, by striking 

11 ‘‘Chapter 1; residual application’’ 

12 and inserting ‘‘Application’’; and 

13 (ii) by adding at the end the fol14 lowing: ‘‘This chapter applies to the extent 

15 that this chapter is not in conflict with 

16 chapter 4.’’; and 

17 (D) in section 307— 

18 (i) in the section heading, by striking 

19 ‘‘Chapter 1; residual application’’ 

20 and inserting ‘‘Application’’; and 

21 (ii) by adding at the end the fol22 lowing: ‘‘This chapter applies to the extent 

23 that this chapter is not in conflict with 

24 chapter 4.’’. 

25 (2) TABLE OF SECTIONS.— 


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1 (A) CHAPTER 2.—The table of sections for 

2 chapter 2 of title 9, United States Code, is 

3 amended by striking the item relating to section 

4 208 and inserting the following: 

‘‘208. Application.’’. 

5 (B) CHAPTER 3.—The table of sections for 

6 chapter 3 of title 9, United States Code, is 

7 amended by striking the item relating to section 

8 307 and inserting the following: 

‘‘307. Application.’’. 

9 (3) TABLE OF CHAPTERS.—The table of chap10 ters for title 9, United States Code, is amended by 

11 adding at the end the following: 

‘‘4. Arbitration of employment, consumer, and civil rights disputes ........ 401’’. 

12 SEC. 4. EFFECTIVE DATE. 

13 This Act, and the amendments made by this Act, 

14 shall take effect on the date of enactment of this Act and 

15 shall apply with respect to any dispute or claim that arises 

16 on or after such date. 

Æ 


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