The Federal Arbitration Act (FAA) is codified at 9 U.S.C. §§ 1-16.

9 U.S.C. § 2  provides that a written agreement to settle future disputes by arbitration in any "maritime transaction or a contract evidencing a transaction involving commerce ... shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract...."

Especially important in the employment context, is 9 U.S.C. § 1, which expressly exempts from coverage "contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce." This means that where an employee is of a "class of workers engaged in foreign or interstate commerce" they are exempt from arbitration under federal law.

The FAA has recently been amended by the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (EFAA), codified at 9 U.S.C. §§ 401-02. As its name implies, the EFAA invalidates pre-dispute arbitration agreements that require mandatory arbitration of sexual assault or harassment claims. 

The Uniform Arbitration Act (UAA) is a model act drafted by the Uniform Law Commission and enacted, in whole or in part, in 23 states. It was originally enacted in 1955 and revised in 2000 as the Revised Uniform Arbitration Act (RUAA), reflecting developments in the law of arbitration. In the adopting states, the Act serves as the governing arbitration law where not preempted by the FAA.

Answering this question requires an understanding of the FAA's powerful preemptive effect. When determining whether the FAA or a state's arbitration law applies to an arbitration agreement, the FAA generally takes precedence. The FAA applies to arbitration agreements involving interstate commerce. It's important to note that "involving interstate commerce" does not literally require transportation across state lines; it can also mean "affecting commerce," aligning the FAA with Congress's Commerce power. It has been expressed that there are few agreements today to which the FAA does not apply. However, under freedom of contract principles, parties can override this default functioning through sufficiently explicit choice-of-law provisions.

For detailed discussion, see the following: 

• Terry L. Trantina, What Law Applies to an Agreement to Arbitrate?, Dispute Resolution Magazine; Washington, Vol. 22 Iss. 1 (2015).

  • (available via ProQuest and the ABA)