S. 2026: CLASS Act of 2025 (119th Congress) Bill Summary

This bill, known as the CLASS Act of 2025, proposes several significant changes regarding the rights of students enrolling in institutions of higher education. Below is a breakdown of the key provisions of the bill:

Inapplicability of Arbitration Agreements

The bill stipulates that certain provisions of the U.S. law concerning the enforcement of arbitration agreements (as outlined in Chapter 1 of Title 9 of the United States Code) will not apply to enrollment agreements made between students and institutions of higher education. This means that if a student has a contract with a college or university regarding their enrollment, the college or university cannot enforce a clause that requires the student to settle disputes through arbitration rather than in a court of law.

Definition of Key Terms

Enrollment Agreement: This refers to any contract between a student and a higher education institution where the student commits financially in exchange for the opportunity to study at that institution.
Institution of Higher Education: This term encompasses colleges and universities as defined under the Higher Education Act of 1965.

Prohibition on Limitations for Legal Claims

The bill also seeks to amend the Higher Education Act of 1965 by adding a provision that prohibits colleges and universities from requiring students to agree to any limitations on their ability to pursue legal claims in court. Specifically, institutions cannot enforce rules that would restrict a student’s ability to:

Choose the applicable law to a legal dispute.
Have a jury trial.
Select the venue (the physical location) where legal matters will be addressed.

This provision aims to ensure that students have full access to legal remedies without being hindered by agreements that might limit their rights to sue or claim damages.

Effective Date

The provisions of this bill, if enacted, will take effect one year after it is signed into law, allowing time for institutions and students to adjust to the new requirements.