Ladies, you know that sensation you get in the pit of your stomach, when you’re at work and one of your male colleagues is making wholly inappropriate sexual advances, Fox-and-Friends-style? Or, you go to happy hour and one of your male colleagues says, “I got the next round” cause it turns out, he’s doing the same job as you are, but getting paid way more for it, just because he’s a man? And then, you vent about it all to your girlfriends, and find out all of us women are going through the same damn things, all damn day? That’s when it’s time to channel our inner Beyoncé, raise a glass, and say, “okay ladies now let’s get in formation”—and join together in a class-action lawsuit for sex discrimination. But it turns out, we can’t. Each and every one of us has likely signed away our rights to go to court. We all signed mandatory arbitration agreements.
What is Forced Arbitration?
Forced arbitration is a tool employers are using to forbid their employees from seeking justice in court when disputes arise in the workplace.
Arbitration is a form of private dispute resolution in which the employer and employees submit their dispute to a professional arbitrator (usually a private lawyer), who will hear both sides’ positions and decide who wins. The arbitrator’s decision is legally binding and generally non-appealable in court – meaning, the arbitrator’s decision is final. And usually, the arbitrator deciding the dispute is chosen by the employer.
Most arbitration in employment is forced upon employees. Every day, more employers are requiring their employees – as a condition of being hired or of remaining employed – to sign a contract agreeing that if a workplace dispute should arise, it will go directly to closed-door arbitration, and will never get into the courtroom.
Since the arbitration clauses are buried in the fine print of employment contracts, it’s estimated that at least 60 million workers in America are subject to arbitration clauses that they don’t even know about. Workers must accept a process they often don’t understand, where the costs of seeking justice might be too expensive for an employee to use. That’s right – employers and employees have to pay for this service. Arbitration is like a private, for-profit court system.
By signing these mandatory arbitration contracts, employees are waiving their fundamental, constitutional right to a trial by a jury of their peers. That may not seem like a big deal, but so many major legal changes in our society came from cases fought on the public stage of the United States Supreme Court. Imagine, if the Brown v. Board of Education plaintiffs, instead of having the public forum of the Supreme Court (and the eyes and ears of the nation) had to fight their cases behind closed doors with a private arbitrator. We would never have had that landmark decision that changed the landscape of our country’s education system.
And when it comes to fairness on the job, it matters that workers are given their day in court, even when workers lose, because the nation still pays attention. Take Lilly Ledbetter’s case, for example, Ledbetter v. Goodyear Tire & Rubber Co., 550 U.S. 618 (2007). When she found out that she was earning significantly less than her male colleagues for doing similar work during her nearly twenty-year career at Goodyear, she fought her case all the way to the Supreme Court. She lost her case because of a procedural technicality in the law.
But because she spoke out in open court, the nation heard her story – and so did Congress. The first piece of legislation that President Obama signed was the Lilly Ledbetter Fair Pay Act of 2009, fixing the technical problem in the law that was keeping women from their day in court for pay discrimination. If she had been forced into a private arbitration instead, the nation would have heard about Lilly Ledbetter, and our federal government never would have fixed the law that helps so many women get justice for pay gaps going forward.
The increased use of forced arbitration silences working men and women, and forces us to fight our battles quietly, and alone. Behind closed doors. And the arbitration proceedings themselves are sealed with the lock-and-key of a confidentiality clause, which is also buried in the fine print of our employment contracts. Just ask Gretchen Carlson, and the other women at Fox News who were prohibited from joining a class action for sex discrimination, because of forced arbitration clauses in their employment contracts.
The United States Supreme Court Case
On October 2, 2017, the Supreme Court will decide whether employers can continue to force employees into arbitration agreements banning collective-action lawsuits, in a case called NLRB v. Murphy Oil. The employees in this case sought to join class action lawsuits asserting that their employers had unlawfully denied them overtime pay. But in order to keep their jobs, their employers forced them to sign arbitration agreements with class-action waivers, which only permit the employees to arbitrate their employment disputes individually, in separate arbitration proceedings. The employees argued that these forced arbitration contracts violate their rights to collective action under a federal law, called the National Labor Relations Act (NLRA).
The NLRA states that, “Employees shall have the right to self-organization, to form, join, or assist labor organizations . . . and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.” The National Labor Relations Board – the federal agency charged with interpreting the NLRA – concluded that arbitration agreements with collective-action waivers violate the NLRA because they prevent employees from taking any concerted legal action to improve their conditions of employment. As the Board found, “[t]he core objective of the National Labor Relations Act is the protection of workers’ ability to act in concert, in support of one another.”
Unfortunately, it is widely speculated that the Supreme Court was split 4-4 on this case when Justice Scalia died – therefore, Trump’s nominee for the Court, Justice Gorsuch, will likely cast the deciding vote in this case. And Justice Gorsuch was outted by a former law students for disparaging women go request maternity leave when, during a law school class, he implied that women manipulate companies starting in the interview stage to extract maternity benefits. Odds are he’s not going to vote in favor of women’s rights to take their employers to court in this case, either.
Employers are using arbitration to get away with sex or race discrimination, and to escape lawsuits for wage theft— by putting binding arbitration clauses in employment contracts, which keeps cases out of the state and federal courts and push them into private dispute resolution systems that systematically favor employers. Congress can fix this problem by amending the Federal Arbitration Act to make sure employers can no longer force this system on their employees – and Senator Al Franken has dropped the Arbitration Fairness Act of 2017 in Congress to do just that. Maybe, someday, our Congress will do the right thing for women, for workers, and for our nation’s system of justice in open court.
But to get Congress to act, we have to put pressure on them. It’s time to organize, to pay attention, and to act.
Okay ladies … now let’s get in formation.