Illinois Senate Votes In Favor of Making It Illegal To Require Employees To Sign an Arbitration Agreement as a Condition of Employment

Stop Sign Over Arbitration Agreement

The efforts of Stephan Zouras, LLP in Springfield are finally being noticed. On May 23, 2019, the bill drafted by Jim Zouras and Teresa Becvar passed the Senate by a vote of 33-18.

This bill makes it unlawful for Illinois employers to force employees to sign an arbitration agreement as a condition of employment – otherwise known as “forced arbitration” or “mandatory arbitration.”

The bill states that, “An employer may not require as a condition or precondition of employment that an employee or person seeking employment waive, arbitrate, or otherwise diminish any future claim, right, or benefit to which the person would otherwise be entitled under state or federal law.”

As an employee, this means that an employer cannot make you sign away your Constitutional rights as a prerequisite to getting a job.  In addition, if an arbitration agreement is presented to an employee, the employer must include a statement across the top of the document stating that the arbitration agreement is not a precondition of employment.

As attorneys who have dedicated their entire professional careers to vindicating employee rights, we strongly suggest, NEVER signing an arbitration agreement.  And here’s why…

The Economic Policy Institute estimates that more than 60 million American workers are now subject to mandatory arbitration agreements. In 1992, only 2% of American workers were subject to forced arbitration. This exponential increase directly impacts workers in Illinois, with millions of Illinoisans – at least 60% of those employed by large private sector employers — now subject to forced arbitration.

How does forced arbitration hurt workers?

Arbitration agreements are imposed, often against those with the least bargaining power (minorities, women, hourly-paid, low wage earning blue collar workers) as a mandatory condition of employment. In other words, the employee is forced, in exchange for employment or continued employment, to surrender their Constitutional right to access the court system. The employer, on the other hand, almost always retains the right to go to court against the employee.

Arbitration agreements are almost never individually negotiated; they are typically form agreements often hidden in “the fine print.” Usually, the employee does not even realize they have given up their Constitutional rights until the employer engages in illegal conduct against the employee and they consult with a lawyer. This includes claims for sexual harassment, discrimination based on race, sex or religion, claims for unpaid minimum or overtime wages, and more.

Employers have every reason to want to force employees into arbitration. At arbitration, employees do not have the same rights and protections as in court. There is no judge, no jury, no appeal, and only limited discovery and procedural rights. The entire proceeding takes place behind closed doors with no public scrutiny or accountability. That helps ensure that the employer’s illegal practices and serious misconduct remain a secret, removing any incentive for it to change.

Even worse, arbitration proceedings are overseen by an arbitrator who is not elected, not appointed by an elected official, not required to follow legal precedent, may have limited or no experience, and may be biased, prejudiced or have interests which are in conflict with the employee.

Studies have shown that employees are far less likely to win at arbitration and even when they do win, the damages they are awarded are significantly less than in court. One study found that at arbitration workers win just 21.4% of the time, and the award amount was three times smaller than cases decided at trial.

Following the testimony of Jim Zouras before the Illinois House of Representatives Labor Committee, the House passed the bill last month. On Tuesday May 7th, the bill was heard before the Illinois Senate Committee, where Jim once again testified on behalf of employee rights. On May 23, 2019 the bill passed the Senate. The bill is currently in the House of Representatives for a concurrence vote.

We are extremely proud of our efforts and the timeliness of bringing light to changes that are needed in the Illinois Employee Contract Act.  We applaud the majority of our elected representatives who see the need to protect Illinois workers.

Passing this bill into law would be a huge victory for all workers in Illinois – preserving their Constitutional rights and access to the courts, and preventing corporations from avoiding accountability for engaging in misconduct against employees. To help ensure the passing of this bill, we urge you to contact your representative and let them know you support HB2975.  You can easily find your rep’s email address and/or phone number by entering your address here. 

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