Employee Arbitration (S.3754/A.5777) | 2019

June 14th, 2019

AN ACT to amend the general obligations law, in relation to prohibiting employers from requiring certain  conditions or preconditions of employment

S.3754 (Hoylman) / A.5777 (Dinowitz)

MEMORANDUM IN OPPOSITION

Unshackle Upstate, a non-partisan, pro-taxpayer, pro-economic growth, education and advocacy coalition made up of business and trade organizations from all parts of Upstate New York opposes this legislation which seeks to prohibit arbitration agreements as a condition of employment.

Arbitration is frequently used as a reasonable and effective way for parties to resolve employment disputes. This process is equitable and allows the parties to resolve any issues quicker than if they proceeded through the court system. This legislation would eliminate the opportunity for arbitration, making the process more expensive and increasing the time required to reach a resolution.

In 2017 the US Supreme Court in an opinion written by Justice Kagan they court made it very clear that the Federal Arbitration Act governs such agreements and preempts state laws to the contrary. Federal law favors arbitration and courts continue to enforce arbitration agreements.

Unshackle Upstate has consistently advocated for policies that will make New York a more affordable place for businesses and taxpayers. This policy would make the resolution of employment disputes more costly and less efficient. This legislation would also be subject to legal challenges as a result of the federal preemption, serving no benefit to employers or employees.

For these reasons Unshackle Upstate opposes the enactment of this legislation.