What's happening
This bill prohibits New York State from contracting with companies that require employees to agree to binding arbitration for all disputes, except for those involving sexual or other assaults.
Why it matters
Limits the use of forced arbitration. The bill targets companies that require employees to resolve all workplace disputes through binding arbitration, a process that often restricts employees’ ability to bring grievances to court and keeps disputes confidential, potentially shielding employers from accountability.
Increases state leverage for worker rights. By tying state contracts to this employment practice, New York uses its purchasing power to incentivize companies to drop mandatory arbitration clauses, potentially prompting widespread changes in private sector employment agreements.
Adds enforcement and certification requirements. Contractors must formally certify compliance with the new rule, and the state is empowered to investigate violations, impose sanctions, recover damages, or even bar non-compliant companies from future contracts—making the policy enforceable, not just symbolic.
Focuses on exceptions for severe misconduct. The only permitted exception is for disputes involving sexual or other assaults, recognizing that these particularly serious cases should never be subject to forced arbitration, in line with broader national trends to exempt such claims from mandatory private resolution.
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Headline styles
Ban Forced Arbitration Contracts
Plain English, a few words. Used as the page title.
Sponsors
2 Co-sponsors
History
- Referred to finance
- Referred to finance
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Ban Forced Arbitration Contracts
In Assembly Committee · Governmental Operations · Sponsor Jo Anne Simon
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
4265
2019-2020 Regular Sessions
IN SENATE
March 5, 2019
Introduced by Sens. PARKER, KRUEGER, SEPULVEDA -- read twice and ordered printed, and when printed to be committed to the Committee on Finance
AN ACT to amend the executive law, in relation to prohibiting the state from entering into contracts with companies requiring employees to stipulate to binding arbitration for all disputes
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The executive law is amended by adding a new section 170-c to read as follows:
§ 170-c. Prohibiting the state and certain state entities from entering into contracts with certain companies requiring employees to stipulate to binding arbitration agreements. 1. Notwithstanding any inconsistent provisions of any general or special law or resolution, neither the state nor any state agency including: (i) any state department, or (ii) any division, board, commission, or bureau of any state department, or (iii) the state university of New York and the city university of New York, including all their constituent units, except community colleges and the independent institutions operating statutory or contract colleges on behalf of the state, or (iv) a board, a majority of whose members are appointed by the governor or who serve by virtue of being state officers or employees as defined in subparagraph (i), (ii) or (iii) of paragraph (i) of subdivision one of section seventy-three of the public officers law, (v) any public authority, other than multistate authorities, public benefit corporations, and commissions at least one of whose members is appointed by the governor, nor the legislative and judicial branches of government, nor any fund of any of the foregoing, nor any officer of any of the foregoing, shall contract or renew a contract for the supply of goods, services, or construction with any overseas contractor who does not agree to stipulate to the following as a material condition of the contract: the contractor, any subsidiary of a contractor, any franchiser of the contractor, and any subcontractor to
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD01801-01-9
S. 4265 2
be employed by the contractor shall not utilize an employment contract containing clauses which require employees to stipulate to binding arbitration agreements for all disputes unless disputes involving sexual assault or other assault are excluded.
2. Any contractor, any subsidiary of a contractor, franchiser of the contractor, and any subcontractor to be employed by the contractor shall certify that it is in compliance with the requirements of this section. Such certification shall be filed with the state governmental contracting party and made a part of its contract file.
3. Upon receiving information that a contractor who has made the stipulation and certification required by this section is in violation thereof, the state governmental contracting party shall review such information and offer the contractor an opportunity to respond. If the state governmental contracting party finds that a violation has occurred, it shall take such action as may be appropriate and provided for by law, rule or regulation, or contract, including, but not limited to, imposing sanctions, seeking compliance, recovering damages, declaring the contractor in default, and seeking debarment or suspension of the contractor.
§ 2. If any provision of this act or the application thereof is held invalid, the remainder of this act and the application thereof to other persons or circumstances shall not be affected by such holding and shall remain in full force and effect.
§ 3. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the executive law, in relation to prohibiting the state from entering into contracts with companies requiring employees to stipulate to binding arbitration for all disputes
Purpose or general idea of bill
To prohibit the state from entering into contracts, or renewing contracts, with certain companies requiring employees to agree to bind- ing arbitration contracts for all disputes, including but not limited to, sexual assaults.
Summary of specific provisions
Section 1 amends the executive law by adding a new section 170-c which would prohibit the state from entering into contracts, or renewing contracts, with certain companies requiring employees to agree to bind- ing arbitration contracts for all disputes, including but not limited to, sexual assaults.
Justification
Many companies require workers to sign binding arbitration agreements as part of their employment contracts, which require employees to forego their right to seek legal remedies for all disputes with the employer, including those arising from sexual assault and other assaults.
Workers who are sexually assaulted while working for defense contractors overseas typically have few options. They cannot bring charges in the country where the crime was committed, and the binding arbitration clause bars them from using courts in the united States.
In one of the most infamous cases arising from this practice of overseas contractors for defense corporations, Jamie Leigh Jones, a 20 -yr-old employee of defense contractor ICIER, who was stationed in Iraq, stated she was gang raped by her co-workers and imprisoned in a shipping container when she tried to report the crime. Her father and her congressman fought to secure her safe return to the United States, but once home, Ms. Jones learned a fine-print clause in her KBR contract banned her from taking her case to court, instead forcing her into an "arbitration" process that would be run by KBR itself. Ms. Jones was forced to go to court to sue for the right to get justice, and after several years of litigation, she received a favorable ruling, allowing her to seek justice. She has been pursuing the matter in court since 2005.
In 2008, a number of female employees of overseas defense contractors testified before the U.S. Senate Armed Services Committee. According to Sen. Bill Nelson of Florida, who cited Defense Department statistics, more than two dozen female contractor employees-working in Iraq and Afghanistan have reported being raped or sexually assaulted. One of the women testifying, Dawn Leaman, a mother of two active duty military personnel, stated she was drugged and brutally gang-raped by soldiers and coworkers. She said KBR's employee assistance Program discouraged her from filing a formal report.
It is time the State of New York took measures to end this abhorrent behavior and help the employees assaulted overseas to gain justice. By barring contractors who require their employees to sign such binding arbitration agreements from contracting with the State of New York, this state will step forward and help protect the employees who are unable to find justice under current law and practice.
Prior legislative history
2017-18: 52298 Referred to Finance 2015-16: S .2452/5795 - Referred to Finance 2013-14: S. 1840/A.2628 - Referred to Finance/Infrastructure and Capital Investment 2011-12: S .1729/A.6125 - Referred to Finance
Fiscal implications
Indeterminate.
Effective date
This act shall take effect immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.