A Missouri State House committee heard contentious legislation Tuesday morning to steer employment disagreements away for the courts and toward arbitration.
The proposal would impact employees who sign arbitration agreements, which are often included in paperwork in the hiring process.
It would give arbitrators full authority to determine whether arbitration or court proceedings will be used to settle workplace claims by employees. Current law allows workers who are subject to arbitration to seek a court’s determination of whether an arbitration contract is valid.
The bill (HB 1512), which was presented by its sponsor, Republican Representative Kevin Corlew of Kansas City, was heard Tuesday morning in the House Special Committee on Litigation Reform.
Corlew calls arbitration an efficient, timely and cost-effective way to settle disputes for all parties. He further notes the process frees up courts to hear other important litigation.
Opponents, including several Democrats on the committee contend arbitrators, who are paid for their services, have little incentive to refer cases to the courts, which have no monetary interest in the proceedings.
They also argue that most arbitration agreements come with conditions requiring secrecy, effectively blocking any public disclosure of possible wrongdoing by employers, such as sexual harassment or discrimination.
Democratic Representative Gina Mitten of St. Louis said revelations about rampant sexual misconduct in Hollywood would have never been outed under proposed legislation in the Missouri legislature.
“If Harvey Weinstein had arbitration agreements with all of his employees, and nobody ever came forward, do you think that we would be having any conversation in our country, and frankly on our planet about the proliferation of sexual harassers getting away with it in the workplace for decades?”
In a tweet to Missourinet, Mitten said “In the #MeToo era, bills that make it more difficult to bring claims (like #SB43) and keep them secret (like this arbitration bill #HB1512) are a snub to women in the workplace”.
SB 43 is a measure that was signed into law last year which raised the threshold for proving workplace discrimination.
Janet Mark, associate general counsel at Hallmark Cards Inc., testified in favor of the legislation. She said it had nothing to do with keeping worker complaints from being disclosed, and stated that arbitration is more effective than courts in determining liability.
“Very few sexual harassment or employment claims ever make it to trial,” said Mark. “In arbitration, folks are more likely to get a hearing, so the victims of sexual harassment who want a hearing on the merits are more likely to get that in arbitration than in litigation.”
Democratic Representative Mark Ellebracht of Liberty noted that he disagreed with the policy changes made in the bill, and also claimed it has procedural issues. Ellebracht said the measure runs into legal problems because it violates federal and state constitutional guarantees of a person’s right to a trial by jury.
“You’re taking about taking away peoples’ constitutionally guaranteed right by statute,” said Ellebracht. “I think that the people in the state of Missouri should know that. And I think that you should be aware that this is probably not the proper mechanism to do that.”
When asked by fellow Republican Representative Bruce Degroot of Chesterfield to elaborate on the proposal, Corlew said it’s in keeping with decisions by the Supreme Court, which has held that arbitrators are authorized under the U.S. Constitution to make decisions on whether or not a case will go to arbitration.
St. Louis employment lawyer Mary Anne Sedey spoke against the bill. She said it wrongly puts arbitrators, who are beholden to big business, in charge of judging employee complaints.
“It replaces judges with private judges, who are bought and payed for, and I’m sorry but I’m going to say this, primarily by the corporations,” said Sedey.
Corlew contends arbitrators will be held responsible for their actions because of a strict ethics code they’re required to adhere to, and notes employees are further protected by the bill’s requirement that both parties – the employer and the worker – have to agree on which arbitrator will hear the case.
Among the business groups voicing support at the hearing for the bill were Associated Industries of Missouri, the Missouri Chamber of Commerce, the Kansas City Chiefs (the team’s lobbyist state that the team uses arbitration agreements), the Kansas City Chamber of Commerce, the Missouri Insurance Coalition and the NFIB Missouri Small Business Association.
Stating opposition to the measure were state’s biggest union, the AFL-CIO of Missouri, the group Empower Missouri, the LGBT organization PROMO Missouri and numerous employment attorneys who predominantly represent workers.