Ky. House Approves Bill Allowing Employers To Demand Arbitration Agreements
The Kentucky House of Representatives has passed a bill that would once again allow employers to force employees to sign arbitration agreements as a condition of employment.
Kentucky is currently the only state in the country that doesn’t allow employers to impose the agreements, which require employees to settle disputes privately instead of suing in court.
Rep. Angie Hatton, a Democrat from Whitesburg, said that the bill erodes the constitutional rights of employees.
“Our right to a trial by a jury of our peers is just as important in this country and was to our forefathers as is our right to free speech and our right to bear arms,” Hatton said.
Arbitration requires employees who have a grievance with their employer to negotiate with an arbitrator — an independent negotiator — instead of going through the court system.
Kentucky has a law on the books that bans employers from imposing arbitration agreements as a condition of employment, but federal courts have ruled that the Federal Arbitration Act trumps state laws on the matter.
But in October, the Kentucky Supreme Court upheld the state’s ban on arbitration requirements over the federal policy, prohibiting private and public employers from imposing the agreements.
Senate Bill 7 would rejoin Kentucky with other states where employers are allowed to require employees to sign arbitration agreements.
Rep. Jason Nemes, a Republican from Louisville and sponsor of the bill in the House, took issue with those who characterized the measure as “forced” arbitration.
“If an employer would like to require, as a condition of employment, an employee to sign an arbitration agreement, they could do that. And the employee would have the decision to voluntarily sign it or not,” Nemes said.
Rep. Terri Branham Clark, a Democrat from Catlettsburg, disagreed.
“If I’m an employee and a provision of me keeping my job is a requirement that I sign this agreement, that feels very forced to me,” Branham Clark said.
The bill has already passed out of the state Senate, but the House made amendments to it so the Senate will have to approve the changes before it can be sent to Gov. Matt Bevin's desk.