Hacker News Reader

Comment by Symmetry | Hacker News Reader

Averaged across distinct contracts (as opposed to contract-instances) forced arbitration is a very good thing. If Google and Microsoft get into a dispute about the meaning of some agreement they signed they it's far better that they get some third party to quickly resolve the issue than that they have to spend years and millions of dollars in legal fees fighting it out in the courts. It's only when these agreements are imposed rather than negotiated that they become abusive.

View on HN

> Averaged across distinct contracts (as opposed to contract-instances) forced arbitration is a very good thing.

Forced arbitration is a very good thing for the employers. It's not a good thing for the employees, who are effectively signing away a huge swath of rights.

Employers generally use the same contract for all their employees so employer/employee forced arbitration contracts are only a minority of contracts. If a contract is between two corporations each with their own lawyers to review the contract that giving up of their rights to sue each other is actually a good thing. But that depends on the arbitrator being acceptable to each and desiring repeat business from each. It's the employer/employee situation where only one side has lawyers involved in selecting the arbitrator that the situation becomes abusive.

The parent may agree with you, but they said that in a somewhat obscure way. I believe their point is that companies have many distinct contracts with other companies (good) that contain arbitration clauses, and that employers have a smaller number of distinct contracts with employees (bad) that are duplicated thousands of times over.

You mean arbitration is a good thing. Yes it is. Forced arbitration is taking away the option of going to court.

No, I do mean forced arbitration. If the arbiter would be fair then the ability to threaten to fall back on the court system could be used as a coercive threat. Provided both sides have input into how the contract is drafted the compulsory nature of the arbitration is good for both, in expectation, though obviously when a dispute is adjudicated against either suddenly they'd have an interest in overturning it.

But as I say elsewhere, this doesn't necessarily apply to employer/employee contracts where one side might not even have read the full contract, much less have been able to negotiate its clauses.

> If the arbiter would be fair then the ability to threaten to fall back on the court system could be used as a coercive threat.

If the courts are also fair then there's no threat involved. Plus, what to do if the arbiter isn't fair?

Reply on news.ycombinator.com