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Missouri House gives initial approval to legislation to preserve arbitration agreements – a benefit for both employers and employees

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The Missouri House of Representatives has given first-round approval to legislation that strengthens employment arbitration law – protecting this employment tool for

employers and employees in Missouri. The vote was 89-62.

“The U.S. Supreme Court and state courts throughout the nation have consistently upheld arbitration agreements as reasonable and acceptable alternatives to dispute resolution,” Rep. Kevin Corlew said during debate of House Bill 1718.  “Arbitration is a timely, efficient and cost effective dispute resolution tool for both employers and employees. At the same, it is also judicially efficient, as it frees up dockets that otherwise would be even more filled with litigation.”

An attorney from the Kansas City region, Rep. Corlew explained that his legislation is necessary to combat Missouri court rulings that have greatly weakened businesses ability to utilize arbitration agreements.

“Missouri courts over the last decade have become hostile toward employee arbitration agreements, regularly striking them down and creating a moving target in what makes and enforceable arbitration agreement,” Rep. Corlew said.

His bill would reverse that trend.  The bill states that in arbitration agreements between an employer and an at-will employee the arbitrator must make all initial decisions as to arbitrability, including deciding whether the parties have agreed to arbitrate, whether the arbitration agreement is enforceable, and whether specific claims are arbitrable.

The Missouri Chamber of Commerce and Industry has been a strong supporter of the bill and large Missouri employers have testified in support during committee hjobsbadgeearings of the bill.

“Missouri is an outlier in our judicial approach to arbitration law,” said Brian Bunten, Missouri Chamber general counsel. “Through this legislation, we hope to provide consistency and align with federal law and the many other states so that Missouri employers and employees can rely on an arbitration system that provides fair and speedy dispute resolution.”

During debate, Rep. Corlew described the burden our current inconsistent system places on employers and employees.

“A case in arbitration can be resolved in 8-9 months and that includes getting witnesses, gathering your evidence and arranging your arbitrator,” Rep. Corlew explained. “In contrast, in court you will be looking at 2-3 years. And this idea that you are automatically going to get a trial is inaccurate. The statistics show that in Missouri only 6 percent of cases that go to court receive a trial.”

House Bill 1718 requires a final vote by the Missouri House before it can be sent to the Missouri Senate for review.

 

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