HR-5350-119
Referred to the House Committee on the Judiciary.
Sponsored by Henry Johnson (D-GA)
What it does
The bill would make predispute arbitration agreements and predispute joint-action (class or collective action) waivers invalid and unenforceable for employment, consumer, antitrust, and civil rights disputes. A court, not an arbitrator, would decide whether the new chapter applies. It would apply only to disputes that arise or accrue on or after enactment. Arbitration chosen voluntarily after a dispute arises would still be allowed, and collective bargaining agreements are mostly excluded, though workers could still seek court enforcement of constitutional and statutory rights. Antitrust disputes are covered only where plaintiffs seek class certification, and civil rights disputes only where at least one party alleging a violation is an individual.
Who benefits
Employees and independent contractors who could sue in court or join class or collective actions instead of arbitrating individually. Consumers bringing claims against sellers, lenders, and digital service providers. Plaintiffs in civil rights and discrimination cases who could access public court proceedings. Plaintiffs' attorneys who bring class actions. Small businesses that allege antitrust injury and want to join class actions. Servicemembers and veterans with covered claims.
Who is hurt
Employers, banks, telecom, tech, and other companies that use arbitration clauses to limit litigation costs and class exposure; they may face more lawsuits and higher legal expenses. Businesses that value private, faster proceedings and confidentiality. Arbitration providers who would lose caseload. Courts, which may see more filings and longer dockets. Consumers could potentially see price changes if litigation costs are passed along.
Supporters argue
Supporters argue that mandatory arbitration clauses buried in employment and consumer contracts strip people of their day in court, and that class waivers make small-dollar claims impractical to pursue at all. They contend that courts offer public records, appeal rights, and judges rather than privately paid arbitrators, and that the bill still allows arbitration if both sides agree after a dispute arises.
Opponents argue
Opponents argue that arbitration is typically faster and cheaper than litigation, and that the Federal Arbitration Act reflects a long-standing national policy favoring enforcement of arbitration contracts. They contend that broad bans would increase court backlogs and business litigation costs, expand class actions that often yield small payouts to members and large fees to lawyers, and override the freedom of parties to choose their dispute process.
Constitutional context
Congress would act under its Commerce Clause power (Art. I, §8, cl. 3), which underlies the Federal Arbitration Act; the bill is a statutory change to that law rather than a direct constitutional conflict. Contract rights and the Seventh Amendment jury trial right are background considerations, and AT&T Mobility v. Concepcion (2011) and Epic Systems v. Lewis (2018) upheld enforcement of arbitration and class waivers under the current statute, which Congress could change by amending it.
Checks and balances
Congress would amend the statute and shift decision-making from private arbitrators to federal and state courts, expanding judicial authority; courts retain power to interpret the new chapter's scope, and no new executive agency authority is created.
Historical precedent
Congress previously carved out limited exceptions to arbitration enforcement, such as the 2022 Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act and a 2010 Dodd-Frank ban on mandatory arbitration in certain mortgage contracts; earlier versions of the FAIR Act have been introduced without enactment.