An old cliché says that “there is strength in numbers.” This principle holds true in many situations. When one person is hesitant to go at something alone, they often find the courage when someone is standing next to them. Similarly, a person seeking to unfairly impose their will is more cautious when the intended victim has friends. Labor Unions have, for decades, effectively used “collective bargaining” to protect the rights of workers. It is no secret that many companies would rather negotiate with single employees rather than the workforce as a whole. This way they can “divide and conquer” and maximize their influence.
There was a time when workers collective rights were protected by the courts. However, worker’s rights have increasingly come under assault. The erosion of worker’s rights is reaching a crises situation. Not only are workers losing rights they once had, they are now losing the right to band together. This trend is just fine with most of Corporate America.
Readers of this Report have heard for years about the abuses of mandatory, binding arbitration in consumer transactions. When a consumer goes to buy anything from a DVR to a refrigerator, to a car, they are forced to sign a waiver of their constitutional right to a jury trial and be forced to resolve any disputes through binding arbitration. Usually, the corporation reserves its right to sue in court if the consumer doesn’t pay. These abuses have now thoroughly infiltrated the employment sector in America. It is now common for workers to be forced to waive their right to ever sue their employer in court if they want a job. In similar instances, employees who already have a job are being forced to waive their right to sue their company if they want to keep their job.
Companies argue that mandatory, binding arbitration is quicker and cheaper than litigation. However, there is little evidence to support these claims. There is even less evidence to support the claim that arbitration is fair to the worker. A 2011 Cornell University study found that arbitration favors employers and typically results in lower compensation awards to employees. One reason cases are harder to win in arbitration is because employees often get less discovery and opportunity to fully develop their case.
Awards are often lower because some arbitrators fear that if they give a fair award then they may never get picked to serve as an arbitrator again. The fact cases are harder to win in arbitration and lower payouts are being awarded makes it harder for some employees to find a lawyer to take their case. Rest assured, this is one of the intended outcomes of forcing both consumers and employees into arbitration.
Mandatory, binding arbitration is more oppressive in the workforce when employees are forced to sign “class action waivers” and “anti-joinder” provisions. Although a Plaintiff may have to go to arbitration to resolve their claims, they can technically file on behalf of themselves or join with other workers to bring claims. In these instances, their claims as a group are worth more than just an individual’s claim. This fact makes it more likely that they will be able to find a lawyer to accept the case. Additionally, if you can show that other people have suffered the same injuries, it often makes your case stronger.
A class action waiver is an agreement that you will neither file a class action in arbitration nor participate in a class action against the employer. An “anti-joinder” provision is similar in that it says you will not join your lawsuit with another person even if you both suffered the same injuries from the same event. This is another “divide and conquer” tactic that is being used effectively. Currently, more than 43 percent of employers use arbitration clauses that preclude joinder and class actions. That is up from just 16 percent in 2012.
The fact that so many companies are switching to this abusive practice makes it obvious that the oppressive tactic is working. Congress needs to address this problem and start protecting American workers. Companies should not be allowed to force American workers to waive their Constitutional rights just to get a job. That is more power than any one company should be allowed to have. If you need more information on the subject contact Roman Shaul, a lawyer in our firm’s Consumer Fraud /Commercial Litigation Section, at 800-898-2034 or by email at Roman.Shaul@beasleyallen.com.
Source: Wall Street Journal
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