Getting a credit card, a cell phone or cable service or even accepting a job can mean giving up right to sue the company you’re dealing with.

The New York Times found in an investigation of consumer and employment contracts crafted by corporations that more Americans are being legally prevented from suing businesses, and instead are forced into arbitration hearings that prevent individuals from banding together to fight those with deep pockets. These restrictions are often buried in the fine print of contracts, and must be accepted by consumers and workers if they want their phone or new job.

“By inserting individual arbitration clauses into a soaring number of consumer and employment contracts, companies like American Express devised a way to circumvent the courts and bar people from joining together in class-action lawsuits, realistically the only tool citizens have to fight illegal or deceitful business practices,” according to The New York Times.

The arbitration clauses have become what some judges call a “get out of jail free card” for corporations because they result in plaintiff giving up his or her right to a day in court.

Numerous class-action lawsuits have been thrown out because of arbitration clauses, such as one by Time Warner customers who claimed they were mysteriously overcharged.

The Times’ Jessica Silver-Greenberg found other examples: “A top executive at Goldman Sachs who sued on behalf of bankers claiming sex discrimination was also blocked, as were African-American employees at Taco Bell restaurants who said they were denied promotions, forced to work the worst shifts and subjected to degrading comments,” she wrote.

William G. Young, a federal judge in Boston who was appointed by President Ronald Reagan, told the Times that the growing use of arbitration clauses represented one of “the most profound shifts in our legal history.”

“Ominously, business has a good chance of opting out of the legal system altogether and misbehaving without reproach,” Young said.

If there’s to be any change in this move toward companies acting as judge and jury in cases in which they’re the defendants, it will have to come from Congress, not the courts. One of the first cases involving required arbitration clauses that went to court was argued on behalf of Discover Card by an attorney named John Roberts. The court denied his petition to hear a case on class-action bans. When a case finally did reach the court, Roberts was chief justice and the case was decided in favor of arbitration proponents along the same lines as Roberts’ argument years before, according to the Times.

-Noel Brinkerhoff

To Learn More:

Arbitration Everywhere, Stacking the Deck of Justice (by Jessica Silver-Greenberg and Robert Gebeloff, New York Times)

In Arbitration, a ‘Privatization of the Justice System’ (by Jessica Silver-Greenberg and Michael Corkery, New York Times)

Supreme Court Supports Companies Forcing Arbitration as Alternative to Class Action Suits (by Matt Bewig, AllGov)