(March 15) – Two key components of the House Democrats’ consumer protection and fairness agenda advanced through the House Judiciary Committee today.
Hidden in the fine print on just about everything a Coloradan agrees to, including employment contracts and many purchases, are clauses requiring that any disputes between the parties be submitted to binding arbitration, sometimes by a person hand-picked by the company. HB18-1261, sponsored by Rep. Mike Weissman, D-Aurora, would ensure that arbitration proceedings aren’t stacked against Colorado consumers. The bill would create uniform ethical standards for arbitrators, similar to those established for judges, and require arbitrators to disclose possible conflicts of interest.
Rep. Weissman quoted a federal judge who described the rise of forced arbitration as “among the most profound legal shifts in our history,” adding: “When something goes wrong, we deserve fair processes that are not tilted in favor of big corporations.”
HB18-1261 advanced to the House floor on a 7-3 vote.
Earlier this afternoon, the Judiciary Committee passed HB18-1262, sponsored by Reps. Dominique Jackson, D-Aurora, and Dylan Roberts, D-Eagle. The bill creates basic transparency and recordkeeping requirements for arbitration service providers, so that the public may see an arbitrator’s list of previous cases, including who paid the arbitrator, how he or she ruled and a variety of other disclosures.
“By permitting corporations to hand-pick arbitrators that have issued decisions in the company’s favor in the past, corporations can avoid or minimize their legal and financial responsibilities,” Rep. Jackson said. “This bill helps make that process fairer.”
“Arbitration is a valuable part of our legal system but as we move toward its increased use, we need to make sure consumers have some basic information about the process,” Rep. Roberts said. “This bill will provide much-needed clarity to Coloradans.”
HB18-1262 passed 6-3 and is on to the House floor.