NYT: Binding Arbitration For Thee, But Not For Me

The Grey Lady Is Deeply Conflicted About Your Right to Sue It.

Cory Doctorow


JasonParis, CC BY 2.0, modified

If you’re in the habit of reading the fine print on the contracts and terms and conditions you sign or click “I Agree” to, you’ll have noticed the phrase “binding arbitration” buried in the text. This sounds like just another boring bit of legalese, but it is unbelievably important — and dangerous.

What is binding arbitration? It’s when you sign away your right to sue someone who has injured you — no matter how gravely — and instead take your case to an “arbitrator.”

Arbitrators are fake judges that corporations hire to determine whether they should bear any responsibility for their misdeeds, whether that’s stealing their employees’ wages or defrauding their customers. Even if you’ve been maimed or murdered by a corporation, the arbitrator gets to decide whether the company that is paying their wages should be held to account for its role in your misery.

It will not surprise you to learn that arbitrators are far more likely to find in favor of the company that pays their bills than they are to find for the people that company has injured. And even if you can wring a judgment out of an arbitrator, the outcome is often confidential, meaning that you can’t tell other people who’ve been injured by the company what words to say to the arbitrator so they can get justice.

But it doesn’t really matter anyway: an arbitrator’s decisions are non-precedential, meaning that two people who’ve been injured by the same company in identical ways are not guaranteed the same outcome, even if they present their cases on identical terms.

To quote the American Association of Justice: “More people climb Mount Everest in a year (and they have a better success rate) than win their consumer arbitration case.”

It’s a shadow justice system run by and for corporate America, and it’s spreading like cancer.

Prior to 1925, arbitration was not enforceable in the USA, but the United States Arbitration Act cleared the way for…