Abstract:

Mandatory arbitration clauses in employment contracts significantly hinder the ability of low-wage workers and other vulnerable populations to seek justice in employment disputes. This study examines the systemic challenges these clauses pose, focusing on their disproportionate impact on marginalized groups, including women, minorities, and immigrants. Using a qualitative approach, the paper analyzes legislative developments, judicial precedents, and arbitration practices to uncover the inequities embedded in the current framework. Findings reveal that mandatory arbitration limits access to courts, reduces transparency, and enforces power imbalances favoring employers. Vulnerable employees often face insurmountable barriers, such as financial constraints, lack of legal knowledge, and limited procedural rights, further exacerbating workplace injustices. Key reforms, such as the proposed Forced Arbitration Injustice Repeal (FAIR) Act, aim to address these issues but face political resistance. The study concludes that legislative action, enhanced employee protections, and increased public awareness are critical for reforming arbitration practices and ensuring equitable dispute resolution. Future research should investigate cross-national arbitration practices and the long-term effects on workers’ rights and workplace equity.