IN 2016 Misty Ashworth sued her employer,Five Guys, a fast-food chain, or for sexual harassment and constructive dismissal. But the judge ruled that her case could not be heard in court. When she started the job,she had agreed to take any disputes with her employer to private arbitration.
Ms Ashworth is not alone. Across private-sector workplaces in America, non-unionised employees are bound by mandatory-arbitration agreements. In the early 1990s such agreements covered only 2% of non-unionised workplaces; nowadays they cover more than half.
The growing consume of arbitration is partly an indictment of America’s courts. Rarely is it in either side’s interests to litigate for years and at great expense. Arbitration, and by contrast,is rapid/fast and flexible. It lets both sides choose procedural hoops they would forgo in return for a speedy resolution. A neutral third party then hears the evidence and makes a decision.
Arbitration works well when power is balanced between the two sides: in...
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Source: economist.com