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The "Jamie Leigh Jones" Amendment is Law!

At the end of the last session of Congress, NELA celebrated a huge victory in our
battle to eradicate forced arbitration of employment claims: enactment of the
"Jamie Leigh Jones Amendment" (also known as the "Franken Amendment" in
section 8116 of the Defense Appropriations Act for 2010). Signed by President
Obama on December 19, 2009, the Franken Amendment is the first federal
legislation that prevents employers from forcing pre-dispute, binding arbitration
on their employees. It prohibits the award of Department of Defense contracts of
over one million dollars to any company that forces its employees or independent
contractors to submit to pre-dispute binding arbitration of Title VII and sexual
assault-related tort claims (with certain exemptions as discussed below).

The Franken Amendment is significant for several reasons:

First, it will protect hundreds of thousands of employees around the country from
being forced to arbitrate their Title VII claims; it is estimated that 80% of defense
contracts exceed the Amendment's one million-dollar threshold. A list of the top
100 defense contractors in 2009 can be found at
http://washingtontechnology.com/toplists/top-100-lists/2009.aspx; or see a more
comprehensive listing at http://www.governmentcontractswon.com/default.asp.

Second, it provides a major new legal tool for employees to use to strike down
forced arbitration clauses imposed by their employers who are federal defense
contractors or subcontractors.

Third, it sets an important precedent for efforts to eliminate forced arbitration in
other employment and consumer contexts.

Specific Requirements For Contractors

Under the Franken Amendment, contractors with contracts over $1 million that
are funded by 2010 appropriations are subject to three separate conditions
regarding forced arbitration of Title VII and sexual assault-related tort claims:

1. Prospectively, they may not enter into forced arbitration agreements with their
employees or independent contractors (§ (a)(1));
2. They may not enforce any existing contracts with employees or independent
contractors that force arbitration (§ (a)(2)); and
3. After expiration of a waiting period, they must certify that their subcontractors
do not enter into forced arbitration agreements with any employee or independent
contractor performing work related to such subcontract (§ (b)).

The list of covered sexual assault-related tort claims is quite extensive and
encompasses "any tort related to or arising out of sexual assault or harassment,
including assault and battery, intentional infliction of emotional distress, false
imprisonment, or negligent hiring, supervision, or retention."

As a practical matter, the most important of the three conditions is probably the
second - the prohibition on enforcing existing forced arbitration agreements -
because it applies whether or not the company changes its practices in accordance
with the new law. Employees protected by the Franken Amendment can invoke it
to defeat motions to compel forced arbitration.

Note that on their face, the first two conditions apply to "any" employee of a
covered contractor, not just those who perform work related to the contract. This
could potentially have broad impact on large defense contractors' workforces.

Limitations

With respect to employment-related claims, the Franken Amendment only
prohibits forced arbitration of claims arising under Title VII of the Civil Rights
Act. It does not cover forced arbitration of claims under any other federal
employment laws (e.g., the Americans with Disabilities Act, the Age
Discrimination in Employment Act, the Fair Labor Standards Act, and others).
The Franken Amendment only applies to contracts funded out of 2010
appropriations (whenever they are received). Unless Congress acts to incorporate
it into the Defense Authorization Act, the Amendment would have to be enacted
every fiscal year to continue in effect in future years.
The Franken Amendment does not apply "with respect to a contractor's or
subcontractor's agreements with employees or independent contractors that may
not be enforced in a court of the United States" (§ (c)).
The Secretary of Defense may waive the Franken Amendment's prohibitions for
national security reasons (§ (d)); however, invoking this waiver provision is
extremely onerous. For example, the waiver must be made contract-by-contract; it
requires a personal determination by the Secretary of Defense; it must be in
writing; and it must be made public.
The first two conditions (§§ (a)(1) and (a)(2)) apply to defense contracts "awarded
more than 60 days after the effective date of" the Act.
The third condition (§ (b)) does not become effective until 181 days after the
effective date of the Act.
* * *

Employees have many people to thank for this victory. First, of course, is Senator
Al Franken (D-MN), whose leadership and dedication struck a colossal blow to
the pervasive practice of forced arbitration. Senator Franken's staff were
exemplary in their organization and strategic implementation. Senate and House
Appropriations Committee Chairmen Daniel Inouye (D-HI) and John Murtha
(D-PA), respectively, showed enormous courage in bucking the defense
establishment. Key leaders in the White House kept the pressure up for a
successful outcome. Our allied partners, especially the Leadership Conference on
Civil Rights, American Association for Justice, Public Citizen, and Fair
Arbitration Now Coalition, worked tirelessly with us in pushing for the Franken
Amendment. The Huffington Post, Jon Stewart, and Rachel Maddow sparked a
viral reaction in the liberal blogosphere, elevating the debate about the
Amendment and the injustice of forced arbitration in our national discourse.
Finally, NELA members played a vital and powerful role by lobbying their
Congressmembers to pass the Franken Amendment.

Thank you and congratulations to all!