Courts frowned on it, though, until attitudes started to change in 1920 with the passage of the first state arbitration law, in New York. The FAA was intended to give arbitration equal status with litigation, and, in effect, created a body of federal law. After World War II, arbitration grew increasingly important to labor-management relations. In the 1970s, arbitration began expanding into a wide range of issues that eventually included prisoners' rights, medical malpractice, consumer rights, and many others. In 1995, at least forty-four states had modern arbitration statutes.
Arbitration can be voluntary or required.
For example, unions and employers almost always put an arbitration clause in their formal negotiations, known as collective bargaining agreements. Similarly, a purchaser and a provider of services who disagree over the result of a business deal may submit the problem to an arbitrator instead of a court. Mandatory arbitration is a more recent phenomenon. States such as Minnesota, New York, and New Jersey have enacted statutes that force disputes over automobile insurance claims into this forum. In addition, courts sometimes order disputants into arbitration.