Sunday, May 11, 2014

Consumer Reports Calls for Ban on Forced Arbitration

Calling arbitration an anti-consumer practice that’s becoming all too prevalent, Consumer Reports claims there isn't a single adult in the United States who is not subject to at least one binding mandatory arbitration clause. The magazine, through Consumers Union, its policy and advocacy arm, criticizes the take-it-or-leave-it way of settling disputes. Consumer Reports, which calls itself a public-service organization, says arbitration language is hidden in the fine print of an array of common consumer contracts, including cell phones and credit cards. The editors are disturbed that forced arbitration clauses are making their way into housing, employment, and nursing-home contracts. Their column states that proponents include corporations and the organizations representing arbitrators who frame arbitration as a benefit for consumers that offers a low cost, informal alternative to lawsuits. Forcing consumers to accept arbitration and give up their rights through legalese buried in the fine print raises red flags for consumer advocates, they say. Consumer Reports is backing the Arbitration Fairness Act, pending in Congress, that would ban the use of these forced-arbitration clauses in consumer and employment contracts. See editorial here-