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By Yin Wilczek
July 30 — The American Federation of Labor-Congress of Industrial Organizations (AFL-CIO) July 30 urged the Securities and Exchange Commission to act on its authority under Dodd-Frank to bar predispute mandatory arbitration agreements.
In a release, the labor union also said that companies should not be able to use corporate bylaws to limit the right or ability of shareholders to participate in class actions.
“The AFL-CIO urges the SECto act to preserve the ability of workers to protect their retirement and pension funds through private litigation and to prevent corporations from exempting themselves from the civil justice system through forced arbitration clauses and class-action bans,” it said.
“The AFL-CIO urges the SECto exercise its congressionally granted authority under Section 921 of the Dodd-Frank Wall Street Reform and Consumer Protection Act torestrict mandatory pre-dispute arbitration provisions in agreements between investors and brokers, dealers and investment advisers.”
SEC officials did not respond to a request for comment.
Heather Slavkin Corzo, director of the AFL-CIO's Office of Investment, told Bloomberg BNA in an interview that the release signals the union's more active involvement against predispute mandatory arbitration provisions. In addition, “a lot of the action around corporate bylaws is going to be happening at the state level, and we'll continue to follow that and look for opportunities there as well,” she said.
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