Obama signs Executive Order prohibiting enforcement of mandatory arbitration clauses for government contractors

Posted on: September 26th, 2014 by Steve Larson
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PresidentialSealPresident Obama has signed the Fair Pay and Safe Workplaces Executive Order, an important step forward in the effort to outlaw forced arbitration of employment disputes. The Executive Order requires prospective federal contractors to disclose labor law violations and provides federal agencies more guidance on how to consider labor violations when awarding federal contracts. Significantly, the Executive Order extends the Franken Amendment beyond defense contractors to companies with federal contracts of $1 million or more and prohibits them from forcing their employees to arbitrate disputes arising out of Title VII of the Civil Rights Act of 1964 and torts related to sexual assault or harassment. The Franken Amendment, first enacted in 2009, bans certain defense contractors from forcing their employees to arbitrate the same types of claims.