Explainer: What is the Expansion of Powers of the Religious Courts Law, and What Dangers Are Inherent in It?

A bill seeking to expand the powers of religious courts and to allow them to arbitrate in civil disputes passed into law. What does the law say, what are the implications for fundamental rights, and is it possible to ensure that arbitration is entered into voluntarily by all parties?

Photo by Yaakov Cohen/Flash90

What does the law say?

Arbitration is a way of resolving disputes outside of the regular judicial process, in which the parties involved decide that the dispute between them will be arbitrated by an agreed party. It is usually a private and flexible proceeding, not conducted according to all the formal rules that apply in the courts, but the process may be subject to the supervision of the civil courts.

The new law grants religious courts – both rabbinical (for Jews) and sharia courts (for Muslims) – the authority to serve as arbitrators in civil matters, such as labor disputes, rental contracts, and financial disputes. This is provided that the parties have signed an arbitration form, and the court has jurisdiction over matters of personal status vis-à-vis at least one of the parties, or that all parties are corporations.

According to the wording of the law, if an arbitration request is not signed by all parties, the court secretariat will issue a notification of the request to those parties that have not yet agreed, inviting them to sign the arbitration form and to agree to the case being heard by the religious court.

If all parties consent, then the religious court will be entitled to hear and rule on the dispute solely according to religious law, raising concerns that all the values and principles of Israeli law designed to protect the parties involved will not be applied in this case.

Finally, at the last minute and with virtually no substantive deliberation, a clause was added equating the status of religious arbitration rulings to that of court rulings. This means that unlike other arbitration decisions, a verdict in an arbitration process held by a religious court, will require no civil judicial confirmation for its enforcement.

What does the law change?

Until this bill passed into law, the religious courts – which are state judicial institutions – were authorized to hear only cases regarding personal status (marriage and divorce). The very existence of official religious courts that are part of the country’s judicial system is a highly unusual situation compared to other democracies in the world.

The current law removes these limitations and grants the courts broad powers in the civil sphere as well. In other words, it seeks to extend even more unprecedented authority to this unusual structure, empowering religious courts to act as an arbitrator in civil disputes.

This expansion of powers is significant in two ways:

• Procedurally, it allows religious courts to conduct arbitration proceedings, and not just legal proceedings, with almost no supervision from a civil court.
• Substantively, it gives religious courts a foothold in general civil law, an area in which they had no authority until now.

Previously, the religious courts conducted arbitrations under religious law until 2006, when the High Court of Justice ruled that there was no legal authorization for such proceedings, and that they blurred the boundaries between the state judicial systems and alternative legal ruling systems.

How will arbitration by religious courts now operate?

The law explicitly states that arbitration will be conducted in accordance with religious law. Thus, the significance of the law is that civil proceedings – in matters of labor, neighbor disputes, torts, property, and more – will be conducted and decided on the basis of a religious legal system, that is not bound by democratic principles and basic rights, and which sometimes contradicts the fundamental values of Israeli law and the laws of the state. Only male judges serve in the rabbinical courts, which constitutes built-in gender discrimination and severely harms the value of equality. Sharia courts also have very limited gender representation (there is only one female qadi in Israel). In addition, substantive religious law, according to which disputes will be resolved, is not equal and is considered by many not to treat the rights of women equally. Though the law includes a list of protected laws, this list is far too limited, and it does not include, for example, the Equal Employment Opportunities Law or the Male and Female Workers (Equal Pay) Law.

If entering the process is consensual, then why do some consider the law problematic?

One of the main reasons given in support of the law is that arbitration will require the written consent of both parties. In reality, however, it is difficult to guarantee freely given consent to this process in a wide variety of situations. Issues include:

• Pressure experienced on receiving an official invitation to a hearing. An invitation from the secretariat of a religious court bearing the emblem of the state may be interpreted as a binding legal summons. For people who are not familiar with the law or are not used to conducting legal proceedings, a formal invitation can exert significant pressure to agree to the arbitration process even if they do not wish to do so.
• The influence of the jurisdiction of the courts in matters of personal status. The religious courts hold exclusive jurisdiction in matters of marriage and divorce. Parties may be afraid to refuse an invitation from the court, out of fear that it will harm them in the future, should they have to turn to the religious court in matters of personal status.
• Power disparities between the parties. In situations where there are significant power disparities, such as between an employee and an employer, or between a tenant and a landlord, the weaker party may feel obligated to agree to religious arbitration as a condition of their contract. In such situations, it is difficult to see the consent given as free and voluntary.

To illustrate the problematic nature of the law, we may consider several examples:

1. An employee at a new workplace signs standard initial employment forms, including a form granting agreement to arbitration before the rabbinical court. A few months later, a dispute arises over overtime pay (with regard to which the employee has special protection from Israeli law). Instead of taking the case to the labor court, the employee discovers that they are required to submit to arbitration by the rabbinical court, conducted in accordance with religious law.

Though the law requires religious judges to clarify whether consent to the arbitration process was given freely, this provides only partial protection, as it is difficult to expect an employee to feel free to express refusal to the proceedings when in the courtroom, in front of an official panel of judges. In any case, such a refusal may be perceived as a withdrawal from a binding agreement, and in addition, there may be great social and professional pressure to agree to the process. Furthermore, if only some employees have signed the arbitration form in advance, a situation may occur in which employees in the same workplace, with the exact same dispute, will have to turn to two different judicial systems – the civil court and the religious court – simply due to whether or not they signed an arbitration form when beginning their employment.

1. A tenant in an apartment signs a lease agreement that includes a consent form for arbitration before the sharia court. When she discovers serious defects in the apartment, she may find herself litigating before the sharia court. She may be hesitant to object to the arbitration process for fear of being perceived as a problematic tenant, exposing herself to a lawsuit for breach of contract in another court, or getting caught up in an expensive and complex legal proceeding.
2. A woman registers for a professional course, and as part of the registration process, signs a form granting agreement to arbitration before the rabbinical court. During the course, the company decides that on certain days only men are allowed to enter the complex, for reasons of “modesty,” so that women are prevented from participating in some of the lessons. In a civil court, such a case would likely be classified as prohibited discrimination, but in the rabbinical court, it is possible that the panel of judges – which is necessarily composed entirely of men – will determine that it has the authority to hear the matter as an arbitrator, and that segregation on the basis of gender does not constitute discrimination.

These examples illustrate how the consent required for the arbitration process may be only formal, and does not guarantee free consent in the substantive sense.

Are these concerns addressed by the fact that the law contains a list of rights that will remain protected in the arbitration process?

The law does state that arbitration rulings will not be able to infringe on the substantive rights to which any of the parties is entitled, citing a short list of laws: the Women’s Equal Rights Law; unconditional labor law protecting workers’ rights; the law protecting the rights of people with disabilities; the Standard Contracts Law; and “any provisions of law that apply, despite any waiver or agreement to the contrary.”

In practice, this list of laws is very limited, and does not include other key legislation that protects basic rights, such as the Equal Employment Opportunities Law; the Male and Female Workers (Equal Pay) Law; and the Prohibition of Discrimination in Products, Services, and Entry to Places of Entertainment and Public Places Law. This can be seen as an indication that the protection of fundamental rights in the framework of religious arbitration may be restricted.

Though the law states that those legal provisions that cannot be waived when making an agreement are also protected under arbitration, it is doubtful whether the arbitration proceedings – which are conducted in a less formal manner, and may be held even without the parties having legal representation – will be able to ensure the upholding of all those rights, protected in a long list of laws not explicitly mentioned in the law. This concern is not purely theoretical: Prior to 2006, when the rabbinical courts conducted arbitration proceedings (without the requisite legal authority), they were not strict about protecting workers’ rights and collective agreements, and even supported the waiver by workers of their basic rights under labor law, such as minimum wage and severance pay, even though such waivers have no validity in civil law.

Will there be judicial oversight of arbitration rulings?

At the last minute and with virtually no substantive committee deliberation, a clause was added to the bill equating the status of religious arbitration rulings to that of court rulings. This effectively means that unlike other arbitration verdicts, a verdict in an arbitration process held by a religious court, will require no judicial confirmation for enforcement.

This means a complete absence of civil oversight looking at whether the arbitration ruling of the religious courts violate basic rights and whether they are consistent with the Israeli state law. Moreover, there is great concern that even if basic legal rules are violated, the injured party will not be allowed to turn to a civil court, and thus there will be no adequate mechanism for overseeing the arbitration proceedings.

If that’s the case, then is this even arbitration?

Arbitration, in essence, is a private and flexible process that takes place outside the state legal system. This law deviates from these principles in several aspects:

• The process is not private. The arbitration takes place in an official state court, in a way that blurs the boundaries between a public service and private arrangements.
• The process is inflexible. Unlike regular arbitration, the parties do not have the option of choosing the judge or shaping the procedures. Once they have given their preliminary consent to the process, they are fully subject to religious law and to the procedure set by the court.
• Lack of oversight mechanisms. The law grants arbitration rulings the automatic validity of a court ruling, without the approval of a civil court.

How might the law affect fundamental rights? How will it affect women’s rights?

The law can be interpreted to endanger basic principles of democracy and a number of fundamental rights, including the right to equality, freedom of religion, and the right to a fair trial. This mechanism could become religious coercion de facto, with weaker parties forced to waive civil law protections due to communal or economic pressures. Alongside all this, the rule of law – a core value in a democratic state – is also at risk, as this law is liable to create a parallel legal system that is not based on democratic principles.

Women are particularly exposed to risks by the law. In various settings in today’s Israel, women have reduced bargaining power: In the labor market, for example, they suffer from lower wages relative to men, and often work in areas of employment in which they have little bargaining power. The majority of those employed in care and education settings are women, and given the communal nature of these settings, they may be under pressure to agree to religious arbitration. Past experience shows that the religious courts tended to approve women’s waiver of basic rights in labor law, such as the minimum wage and severance pay. This is compounded by the institutionalized discrimination that exists within the religious courts, and the expansion of their powers will increase the religious system’s ability to exert pressure on women in the civil sphere as well.

What’s the situation internationally? Is there similar legislation in other democracies?

This Israeli law is extremely unusual compared to other democracies. There are no examples of democratic countries in which official state judicial institutions are authorized to conduct arbitrations according to religious law. In places where religious arbitration is allowed (such as in the UK or Australia), it takes place only in private institutions, without any official state status.

In Ontario, Canada, an amendment was made to the Arbitration Act that allowed private religious arbitration, but later the law was amended so that only private arbitration in family law conducted in accordance with Canadian law would be enforceable in the courts. This amendment was adopted after a government committee noted the difficulty of ensuring free and informed consent, especially with respect to women and to more closed religious communities, and proposed adopting a list of 46 restrictions on private arbitration in religious courts, including oversight of arbitration institutions and a directive that arbitration protect fundamental rights.