Since the early days of the G.I. Bill, students have fallen victim to schemes designed to take unfair advantage of their eligibility for federal college aid. In recent years, predatory schools had required students to sign away their legal rights—denying justice and delaying public awareness of predatory schools

In 2016, our research found that for-profit schools, when they were taking federal aid, had an explicit strategy of preventing students from going to court over broken promises and demanding silence about any complaints or settlements. Also last year, the Obama Administration largely addressed this problem by adopting rules that essentially banned forced arbitration and similar strategies. The rules were scheduled to go into effect next month. Unfortunately, the U.S. Department of Education is now backing away from these important reforms. Today, the Department of Education announced it is delaying the implementation of the new rules, which will halt any protections to past, current, and future students from predatory schools using restrictive clauses to silence complaints.

We are now calling on all schools to agree not to restrict students’ rights.

There is currently no comprehensive list of colleges that do, or do not, use anti-consumer restrictive clauses in their enrollment contracts. Some states like Illinois and Arizona require institutions to re-submit the contracts they require students to sign each year, while schools in other states may only be required to submit enrollment contracts once, or on a multi-year basis. In our research we were able to analyze contracts from 271 schools, obtained largely from state agencies. We are now calling on all schools to agree not to restrict students’ rights. The list below shows the largest colleges that we found using one or more restrictive clauses, along with any updated policy announced publicly by the school.

Colleges Using Forced Arbitration and Other Restrictive Clauses in 2015 Control Structure Enrollment (Fall 2014) Updated information
University of Phoenix For-Profit 254810 Announced elimination of mandatory arbitration clauses in enrollment agreements (May 2016)
Grand Canyon University For-Profit 62304
Kaplan University For-Profit 57943
Devry University For-Profit 56805 Announced elimination of all arbitration clauses (May 2016)
ITT Technical Institute For-Profit 44922 Closed (September 2016)
The Art Institute For-Profit 39253
Argosy University For-Profit 34284
Chamberlain College of Nursing For-Profit 23218 Eliminated use of arbitration clauses (May 2016); Updated name to Chamberlain University (May 2017)
South University For-Profit 21803
Full Sail University For-Profit 19285
National University Nonprofit 17608
Brown Mackie College For-Profit 16149 Ended new enrollment (June 2016)
Virginia College For-Profit 15454
Rasmussen College For-Profit 15410
Academy of Art University For-Profit 15212
Paul Mitchell The School For-Profit 14035
American Intercontinental University For-Profit 13283
Le Cordon Bleu For-Profit 12190 Ended new enrollment (January 2016)
Empire Beauty School For-Profit 11182
Lincoln Technical Institute For-Profit 11161
ECPI For-Profit 10932
Pima Medical Institute For-Profit 10710
Fortis College For-Profit 10049
Carrington College For-Profit 9129 Announced elimination of all arbitration clauses (May 2016)
Aveda Institute For-Profit 8978
Concorde Career Colleges For-Profit 8783
Everest College- Zenith For-Profit 8678
Vatterott College For-Profit 6851
Westwood College For-Profit 6732 Closed (March 2016)
Regency Beauty Institute For-Profit 6094 Closed (September 2016)
Herzing University For-Profit (claims to be nonprofit) 5860
American Career College For-Profit 5229
Universal Technical Institute For-Profit 4683
Milan Institute For-Profit 4621
Note: This table will be updated as new information is released. Updated: June 14, 2017.

The colleges above used one or more of four types of restrictive clauses incorporated into contracts students sign when they enroll:

  • Forced arbitration clauses. These provisions require students and former students to file their complaints in a private, binding process to be heard by an “independent” arbitrator, hired by an arbitration association that has a working relationship with the school. Students and former students who have signed these clauses have signed away their rights to go to court to seek a resolution, all before any dispute has ever been recognized.
  • Go-it-alone clauses. These provisions prohibit students and former students who have similar complaints as their peers from working together when expressing their complaints (such as through a group or class action). The result of this contractual provision means that each student must file their dispute on an individual basis.
  • Gag clauses. These provisions silence students and former students from discussing the details of an ongoing or completed dispute resolution process. While these agreements are common practice in settlements of disputes, they are outliers and raise concerns when they appear in contracts and other documents that colleges require students to sign as a condition of enrollment, before a dispute even arises.
  • Internal process requirements. These provisions mandate students and former students to complete the school’s internal process before they can ever raise their complaint in other dispute resolution processes. By prohibiting students from taking their complaints to other forums for resolution without first going through the school’s internal process, schools can draw out grievance processes and stop complaints from ever getting to the public.