Requires specific notice of mandatory arbitration clauses in employment contracts.
Summary
A07898 would amend New York’s Civil Practice Law and Rules to regulate mandatory arbitration clauses in employment contracts by requiring clearer notice to workers. The bill provides that if an employee is required to sign a contract containing a mandatory arbitration clause, the employer or its representative must disclose that clause and explain, in plain language, what arbitration means. For contracts accepted remotely or electronically, the agreement would need to include an end-of-contract notice stating that the signer is agreeing to mandatory arbitration and provide an internet link to a plain-language explanation of arbitration.
The bill also states that, except where federal law requires otherwise, prohibited mandatory arbitration clauses in employment contracts would be null and void, while the rest of the contract would remain enforceable. It appears aimed at preserving the enforceability of employment agreements generally while limiting the effect of arbitration provisions that are not properly disclosed or that fall within the bill’s prohibition.
Impact
If enacted, the bill would amend CPLR section 7515 to add disclosure requirements and strengthen limits on mandatory arbitration clauses in employment contracts. It would affect employers, employees, and drafters of employment agreements by requiring plain-language notice and online or written disclosures for non-in-person contracting, and by making certain prohibited arbitration clauses unenforceable without invalidating the entire contract. The measure expressly preserves compliance with federal law, so its practical reach would depend on federal arbitration preemption.
Sentiment
The available voting history suggests generally favorable support for the bill, with the Assembly Judiciary Committee reporting it favorably by an 18-3 vote. No committee transcript is available, but the bill’s framing indicates support for transparency and worker notice in employment contracting. The committee vote also suggests that, at least in committee, the proposal was viewed positively despite some opposition.
Contention
The main point of contention is likely the bill’s restriction on mandatory arbitration clauses, which can be seen as limiting employer contract terms and potentially conflicting with federal arbitration law. Opponents may object to the null-and-void treatment of prohibited clauses or to the added compliance burden of plain-language disclosures and internet-link requirements for remote contracting. Supporters are likely to emphasize informed consent, transparency, and employee protection in employment agreements.
Requires employment and consumer dispute arbitrations to be submitted to neutral third party arbitrators; establishes prohibited arbitration agreements and provisions; requires disclosure of information by certain arbitrators.
Prohibits the enforcement of mandatory arbitration agreements clauses and joint-action waivers with respect to workplace disputes; clarifies that section 7515 of the civil practice laws and rules applies retroactively to nullify pre-existing illegal mandatory arbitration clauses.
Prohibits mandatory arbitration agreements in consumer and employment contracts; repeals existing provisions prohibiting mandatory arbitration clauses in certain consumer contracts.
Prohibits mandatory arbitration agreements in consumer and employment contracts; repeals existing provisions prohibiting mandatory arbitration clauses in certain consumer contracts.
Prohibits mandatory arbitration agreements in consumer and employment contracts; repeals existing provisions prohibiting mandatory arbitration clauses in certain consumer contracts.
Prohibits mandatory arbitration agreements in consumer and employment contracts; repeals existing provisions prohibiting mandatory arbitration clauses in certain consumer contracts.
Amends provisions of law governing arbitration proceedings; specifies fees and expenses with regard to employment or consumer arbitration proceedings; directs certain sanctions on a party which breaches an arbitration agreement.
Amends provisions of law governing arbitration proceedings; specifies fees and expenses with regard to employment or consumer arbitration proceedings; directs certain sanctions on a party which breaches an arbitration agreement.