Keep arbitration an option for older Americans

The Protecting Older Americans Act is a misnamed bill that would prevent older employees from filing claims through arbitration

September 20, 2023 6:01 am
(Photo: Getty Images)

(Photo: Getty Images)

Thanks to the arbitration process in Tennessee, countless employees have negotiated reasonable settlements with businesses regarding many types of  disputes. As a student at the University of Tennessee studying this very issue, I know that this system has proven to be an efficient process that saves everyone thousands of dollars and wastes little time.

Still, not everyone is happy with arbitration. Members of the trial bar have sought to end this process, as it prevents them from being able to charge exorbitant legal fees. To accomplish this goal, they have lobbied Congress to pass the Protecting Older Americans Act. This legislation would halt older employees from filing claims through arbitration. Instead, these workers would now be forced to go through long, expensive court litigation that could cost thousands.

Arbitration already helps ensure plaintiffs are able to maximize their financial settlement. Individuals who file under this system win around $70,000 in settlement funds, while those using the court litigation system win much less at nearly $60,000. This $10,000 difference— a huge sum to many working families — would deprive older workers from receiving all of the settlement funds they are entitled to. At the same time, businesses save money by not having to pay expensive court litigation fees.

To ensure parties an equitable process, the country’s largest arbitration groups have developed non-negotiable neutrality requirements for all cases. This includes the nation’s leading arbitration service provider, the American Arbitration Association (AAA), which orders impartiality and conflict of interest disclosure from all arbitrators, while also allowing conflicting parties equal say in the arbitrator selection process. Any case that does not comply with these rules is spurred by the AAA.

Preventing older workers from settling disputes through arbitration leads to lower financial settlements, while businesses save by not having to pay expensive legal fees.

Several legal levers are also in place to ensure arbitration outcomes are subject to public disclosure. Long standing court orders provide disputing parties the opportunity to openly discuss a case as they so please. Other states have passed legislation mandating arbitral forums like the AAA reveal the outcome of these proceedings.

It is clear that arbitration has provided disputing parties with a fair resolution process. It has also made sure that an individual’s financial background is not an issue for filing claims. We can certainly see this when it comes to employment disputes, where plaintiffs may not be able to retain a contingency-fee attorney due to the case’s lack of financial incentive.

Passing the Protecting Older Americans Act into law is a step in the wrong direction. By preventing age discrimination cases from utilizing pre-dispute arbitration clauses, it would mark the end of arbitration as we know it. This is because these clauses allow parties to arrange legal terms in good faith in advance of any future dispute. Without them, disputing parties are unlikely to broker such an agreement after a conflict arises.

As an employee rights advocate, I can vouch for the fact that arbitration is an essential process for resolving disputes, saving years of extensive litigation and countless dollars. It is vital for us to protect workers and defend arbitration by stopping Congress from passing the Protecting Older Americans Act.


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Chris Yard
Chris Yard

Chris Yard is a native of Memphis, an activist, and pre-law student at the University of Tennessee. His work focuses on establishing justice for marginalized groups in the state.