Washington State Governor Issues Executive Order Discouraging Arbitration Agreements and Class Action Waivers for Government Contractors
On June 12, 2018, Washington State Governor Jay Inslee issued an executive order that directs Washington agencies to favor government contractors that do not require employees to submit to individual arbitration of claims.
The executive order is Governor Inslee's response to the recent Supreme Court of the United States decision in Epic Systems Corporation v. Lewis, which upheld the validity of mandatory class action waivers in arbitration agreements. Inslee called the decision a "blow to vulnerable workers" and predicted that the decision "will inevitably result in an increased difficulty in holding employers accountable for widespread practices that harm workers."
The operative language of Executive Order 18-3 is as follows:
To the extent permissible under state and federal law, when making purchasing and other procurement decisions, all state executive and small cabinet agencies shall seek to contract with qualified entities and business owners that can demonstrate or will certify that their employees are not required to sign, as a condition of employment, mandatory individual arbitration clauses and class or collective action waivers.
The Washington Department of Enterprise Services will establish best practices to ensure the directive is consistently applied by all state agencies. These best practices will be issued to Governor Inslee by July 1, 2019. The executive order went into effect on June 12, 2018.