HB 26-1236

HB 26-1236, also known as Arbitration Reform, is a Colorado bill that aims to protect consumers and employees by limiting certain provisions in arbitration agreements. It stops companies from including clauses that prevent people from participating in group lawsuits or charging excessive fees for arbitration compared to court costs. The bill also ensures arbitrators are fair and unbiased and requires businesses to provide detailed records of arbitration outcomes within 90 days, facing penalties if they fail to do so. Since the status is "signed," this means the bill has been approved by both houses of the Colorado legislature and signed into law by the governor, making these protections enforceable now.

Official Summary

The bill:      Prohibits a provision in an arbitration agreement that waives a party's ability to participate in a representative action except as preempted by federal law and disallows the waiver of this prohibition;Prohibits a provision in an arbitration agreement that requires an employee to an employer and employee contract or a consumer to a merchant and consumer contract to pay fees that substantially exceed the costs required to file a claim in state or federal court, except as preempted by federal law, and disallows the waiver of this prohibition;Prohibits an individual from serving as an arbitrator if the individual has a rule, policy, procedure, or demonstrated pattern of conduct that discriminates or prevents, or has the effect of discriminating or preventing, a certain party or type of party from asserting their rights or prevailing in arbitration or that discriminates against an attorney; andRequires an employer or merchant a party to fully comply with requirements of a record of an award, within 30 90 days after the date of the record of an award, or be liable for additional damages caused by their failure to comply.     Under current law, exemplary damages are prohibited in arbitration proceedings. The bill repeals this prohibition.(Note: Italicized words indicate new material added to the original summary; dashes through words indicate deletions from the original summary.)(Note: This summary applies to the reengrossed version of this bill as introduced in the second house.)

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