Archive for September, 2011
Friday, September 30th, 2011
The steel and concrete of Lower Manhattan comes alive every day during rush hour, when gray suits pulse through subway tunnels and the city’s arteries get choked with street vendors, construction workers and other folks hustling to make a living. Now that a bunch of rabble-rousers have occupied the neighborhood, the workers who form Gotham’s backbone are starting to reclaim their turf as well.
It may be too early to draw parallels between the Occupy Wall Street protests at Zuccotti Park (aka Liberty Plaza) and their antecedents in Tahrir Square and Madison. But the movements suggest a general trajectory of grassroots organizing: a spark of protest led by younger activists, followed by the support of labor organizations, bringing up the rear and then moving to the fore.
By Wednesday, the Village Voice reported that the historically militant Transport Workers Union had voted to back, and provide food and services to, the Occupy Wall Street movement. In a video recorded during an evening protest, TWU Local 100 member Christine Williams declared, “The people have finally woke up. And we’re here and we’re staying and we’re not going anywhere.”
TWU spokesperson Jim Gannon told the Voice: ” A motion was brought up to endorse the protests’ goals; I don’t know why it took us so long to do it.” Better late than never, the union says it now plans to amass on the afternoon of October 5 and march to Zuccotti Park.
Other labor-oriented solidarity actions have been undertaken by professors at the City University of New York affiliated with the Professional Staff Congress union (of which this author is also a member). Their group, Solidarity with OWS, is organizing a demonstration against police abuse this Friday afternoon. (Other notable lefty academic allies include Frances Fox Piven, Christian Parenti, and Stanley Aronowitz.)
According to Crain’s New York Business, local unions are collaborating with community-based groups such as Make the Road New York, Coalition for the Homeless and Community Voices Heard — all organizations that are in daily contact with the struggles of the city’s poor and working-class.
The city’s doormen, security guards and maintenance worker see common ground with the occupation, too. The Huffington Post reports that their union, SEIU 32BJ, said that a planned October 12 rally would embrace the current protests’ theme:
“The call went out over a month ago, before actually the occupancy of Wall Street took place,” said 32BJ spokesman Kwame Patterson. Now, he added, “we’re all coming under one cause, even though we have our different initiatives.”
The General Assembly, a proudly amorphous body that is helping coordinate the demonstrations, has set up a Labor Support and Outreach Working Group, which, according to September 29 meeting minutes posted to the Assembly’s website, has encouraged protesters to join a demonstration of the Communication Workers of America nearby. Organizers are reportedly gearing up “to carry out a very creative direct action in support of the phone workers.”
The convergence between the Wall Street occupation and labor activism may escalate in the coming days amid a standoff between New York Governor Andrew Cuomo and public sector workers. The statewide Public Employees Federation just voted narrowly to reject a five-year contractthat would have staved off layoffs at the expense of higher healthcare costs and wage freezes. On Tuesday, union president PEF Brienyen told reporters that when members saw the concessions demanded of them, “The sacrifices were too great, and they said, ‘Enough is enough.”
That axiom would fit nicely among the panoply of anticapitalist slogans that protesters have displayed in Downtown Manhattan, proclaiming “People over Profit” and “Heal America, Tax Wall Street.”
As sister campaigns emerge in other areas under the banner of “Occupy Together,” the Wall Street actions could serve as a kind of petri dish for future protest tactics, building on the occupational groundwork laid by smaller demonstrations, such as a recent encampment at City Hall to protest budget cuts, and a Wall Street protest in May that drew union support from 1199 SEIU and the United Federation of Teachers.
As ITT’s Akito Yokishane reported, the lifeblood of the protests has been the young and the frustrated. But the occupation also represents swelling resentment across all sectors of society — covering expressly the 99 percent of us who are getting screwed and shafted by corporate moguls and, more tragically, our own elected representatives.
Yet the proactive anger has been building in the labor movement far from Wall Street. An editorial by the Socialist Worker points to protests in recent months — by longshoremen in Washington, striking hospital workers in California, and the groundbreaking Verizon strikers — as signs of new “fighting mood” among the rank and file:
Workers haven’t yet prevailed in all of these struggles, nor will all of them win in the future. But what unites these fights is the activism and solidarity on display, despite a hostile corporate media and aggressive employers.
Labor’s new sparks of resistance are proof positive that the defiant spirit of the battle in Wisconsin last winter wasn’t a flash in the pan, but a sign that growing numbers of working people are rediscovering their capacity to struggle. After decades of a one-sided class war, the fightback has begun.
Whether organized labor is finally catching up to youth activists, or the young occupiers are at last rekindling an older legacy of mass resistance, the cross-fertilization of movements is underway. Don’t ask the diverse alliance to state their agenda — the movement is organically structured, with no formal “list of demands” yet, and that’s part of the fun. Not everyone came to Wall Street knowing exactly what they wanted, but everyone there today knows they’ve had enough, and that they’re not the only ones.
This post originally appeared in Working in These Times on September 30, 2011. Reprinted with permission.
About the Author: Michelle Chen is a contributing editor at In These Times. She is a regular contributor to the labor rights blog Working In These Times, Colorlines.com, and Pacifica’s WBAI. Her work has also appeared in Alternet, Ms. Magazine, Newsday, and her old zine, cain. Follow her on Twitter at @meeshellchen or reach her at email@example.com.
Thursday, September 29th, 2011
The United Auto Workers and General Motors are close to finalizing a new contract, following the first contract negotiations to take place between the two since GM was rescued by the Obama administration. But the UAW is still working on a deal with Ford, the only one of Detroit’s big three companies to turn down government aid.
Ford has had nine profitable quarters in a row, and paid its CEO, Alan Mulally, $26.5 million last year. But at the same time, it is fighting against giving its factory workers their fair share of the profits from the company’s success:
At The Rouge, Ford’s massive, 94-year-old factory complex in Dearborn, Mich., there’s talk along the assembly lines of winning back raises and bonuses lost when the company was near financial collapse in 2007. Workers, who assemble F-150 pickup trucks at the site, are upset that Ford is trying to cut labor costs, especially after nine straight profitable quarters and a $26.5 million pay package for CEO Alan Mulally.
When the company was going to fail, the workers “gave up cost-of-living pay raises, performance bonuses and other benefits.” Last year, Ford reinstated merit pay and some bonuses to the company’s salaried, white-collar workers, but has yet to do so for its hourly-wage factory workers.
“We have the big honchos taking multimillion-dollar bonuses and they can’t even give us back” concessions, said Joe Pack, 50, who works at Michigan Assembly in Wayne, Michigan. “Ford has to do a lot more,” agreed Gary Walkowicz, who works at Ford’s Dearborn, Michigan plant.
In 2010, CEO pay across the corporate world went up 27 percent, while worker pay went up just 2 percent. Ford’s continued profitability would not have been possible without its workforce, and the company should be sure to recognize that fact during contract negotiations.
This post originally appeared in ThinkProgress on September 28, 2011. Reprinted with permission.
About the Author: Pat Garofalo is Economic Policy Editor for ThinkProgress.org at the Center for American Progress Action Fund. Pat’s work has also appeared in The Nation, U.S. News & World Report, The Guardian, the Washington Examiner, and In These Times. He has been a guest on MSNBC and Al-Jazeera television, as well as many radio shows. Pat graduated from Brandeis University, where he was the editor-in-chief of The Brandeis Hoot, Brandeis’ community newspaper, and worked for the International Center for Ethics, Justice, and Public Life.
Wednesday, September 28th, 2011
In a crisis, it’s a tough thing to watch people scramble to survive. And those that already have a lot usually are in the driver’s seat, ready to pit one person against the other. The same is true for states–ever desperate to try to get a few jobs for its citizens (and, need I point out, voters) elected officials are ready to give away the store to corporate leaders, no matter what the price might be.
Per the Financial Times today:
As US states jockey to attract jobs to push down high unemployment rates, companies are benefiting from a host of tax breaks and other government-funded incentives.
But the race to offer sweeteners to corporations is raising questions about whether they are worth the cost.
Maryland is looking at expanding benefits for biotechnology and research and development groups, while Missouri’s legislature is considering a $6m programme to keep jobs from decamping to neighbouring Kansas.
In the New York metropolitan area, competition between New York and New Jersey has generated millions of dollars in subsidies to businesses.
Does this create new jobs? Not really.
“Generally such moves involve just moving jobs around,” said James Parrott, chief economist of the Fiscal Policy Institute. “Companies play one [state] off the other.” He argued that for most businesses, “location is so important that no matter what the subsidy is, it can’t be the decisive factor in where they’re going to locate”.
Essentially, it’s corporate blackmail.
By the way, this is nothing new. Four years ago, I wrote about how companies were lying about jobs created in return for tax breaks given out in New York.
And one of the great corporate scam artists in this “give me a tax break to save jobs” is…surprise…Goldman Sachs, as I wrote five years ago. The leader in the financial debacle in 2008 had a lot of experience under its belt: in 2005, it extorted money from New York, threatening to leave the city unless it received tax breaks and low-interest bonds. It did so in a fairly ugly way.
Using the specter of September 11th as a club, the company pocketed an unbelievable deal: $1.65 billion in low-interest, triple-tax-exempt Liberty Bonds, enabling the firm to save as much as $9 million a year in financing costs, which would save Goldman about $250 million over the life of the bonds. If that wasn’t enough, the city also threw $115 million in sales and utility tax breaks at the company, in return for a commitment to maintain its headquarters in Lower Manhattan and employ more than 9,000 people through 2028; those breaks could rise to as much as $150 million if Goldman adds 4,000 new jobs by 2019.
And, then, came a real beauty: rather than pay those tax breaks back, it set aside $16.5 billion in cash to pay out as bonuses at the end of 2006—an average pay day of $622,000 per worker. Of course, average really is misleading—the top dogs at the company will reap the big windfalls (CEO Lloyd Blankfein was in line to cash a check of up to $50 million), with the support staff probably getting a free Metro Card or maybe a nice holiday gift basket, at best.
These are not new stories. A great organization, Good Jobs First, has been banging this drum for a long time.
But, here we are. A crisis has drawn the piranhas to suck up any dollars at the expense of the people.
This post originally appeared in Working Life on September 26, 2011. Reprinted with permission.
About the Author: Jonathan Tasini is the executive director of Labor Research Association. Tasini ran for the Democratic nomination for the U.S. Senate in New York. For the past 25 years, Jonathan has been a union leader and organizer, a social activist, and a commentator and writer on work, labor and the economy. From 1990 to April 2003, he served as president of the National Writers Union (United Auto Workers Local 1981).He was the lead plaintiff in Tasini vs. The New York Times, the landmark electronic rights case that took on the corporate media’s assault on the rights of thousands of freelance authors.
Tuesday, September 27th, 2011
As ThinkProgress previously reported, unions are a key building block of the middle class, and as unionization rates fell in the 20th century, so did the middle class’s share of national income.
Now, the Center for American Progress Action Fund’s David Madland and Nick Bunker have crunched the numbers and found that if unionization rates were just 10 percentage points higher — meaning there would be a net rate of 22.2 percent as opposed to the current 12.2 percent — the typical middle class household would earn $1,479 more every year. That number is almost equivalent to the $1,638 more these families would earn every year from increasing college attainment rates by 10 percent:
The table below shows the state-by-state impact of unions on income. If unionization rates increased by 10 percentage points—to roughly the level they were in 1980—the typical middle-class household, unionized or not, would earn $1,479 more a year.
To put that number in context, increasing college attainment rates by 10 percentage points would boost middle-class incomes by $1,638. Similarly, decreasing unemployment rates by 4 percentage points—bringing rates down to pre-Great Recession levels—would increase household income by $772 per household.
Madland and Bunker charted out the estimated gains from a 10 percent increase in unionization for typical middle-class households across the 50 states. They range from a $1,096 gain in Nevada to a $1,969 gain in New Jersey. Find your state in the chart below:
This post originally appeared in ThinkProgress on September 26, 2011. Reprinted with permission.
About the Author: Zaid Jilani is a Senior Reporter/Blogger for ThinkProgress.org at the Center for American Progress Action Fund. Zaid grew up in Kennesaw, GA, and holds a B.A. in International Affairs with a minor in Arabic from the University of Georgia. Prior to joining ThinkProgress, Zaid interned for Just Foreign Policy and was a weekly columnist at The Red & Black, the University of Georgia’s official student newspaper. He is a co-editor at the Georgia-based blog Georgia Liberal and a regular on RT America’s The Alyona Show and The Thom Hartmann Show and has been a guest host on Al Jazeera English’s The Stream. He is also an occassional contributor to the op-ed pages of The Atlanta Journal-Constitution. His Twitter handle is @zaidjilani.
Monday, September 26th, 2011
Litigation Value: More fodder for everybody’s negligent retention suit as Dwight shows more predilections toward violence in the workplace, but otherwise, not much litigation expected from this episode – just a host of employee morale issues. I’m sure Robert California will be harassing someone before long, though.
Well, friends, the wait is finally over – last night we met the new Sabre Scranton branch manager! The selection committee chose Robert California, played by James Spader… but after one look at the office he drove straight to Florida and talked Jo into giving him her CEO job instead. That’s one persuasive guy. I guess I can see why the selection committee liked him… well, maybe liked is too strong a word. I can see why they were intrigued. California then chose an internal candidate to fill the manager’s seat – none other than that singing phenom, Andy Bernard!
Of course, California’s reign as CEO gets off to a rocky start. After zeroing in on Erin for an intense small-talk session, California leaves his personal notebook open at the reception desk. Naturally, Erin looks at it and what she finds is a list of all the employees in the office, divided into two columns. Soon the entire office is buzzing – what does it mean? Dwight gathers the employees into two groups and prompts the left side of the column to “Attack!” – starting a minor workplace brawl, which could have been worse if anyone other than Kevin listened to Dwight. I’ll say it again. Between stashing weapons around the office, nearly shooting one of his co-workers, and now trying to start a brawl in the middle of the workplace (which is only appropriate if your workplace is a hockey rink), why is Dwight not fired yet? The guy is a negligent retention lawsuit waiting to happen. Given that he has shown, not signs, but actual acts of workplace violence, it’s only a matter of time until he seriously hurts someone – and then Sabre is going to have a big litigation bill, and maybe even a bigger settlement, on its hands.
When California invites the left side of the list – including Jim, Dwight, Oscar, Angela, Phyllis and Kevin – out to lunch and tells him that he thinks they’re “winners,” the tension escalates. If the left side of the list are winners, does that mean the right side of the list are losers? Well, yes, evidently that’s exactly what it means. The list seems to be some kind of twisted motivation tool, as California urges the “winners” to prove him right and the “losers” to prove him wrong.
As we’ve seen time and time again (i.e. with Michael Scott), so many workplace problems are caused by a lack of common sense. As lawyers, we often focus on the legal ramifications of a particular action. And while the legal ramifications are important, it’s also important to consider things like how a particular action by a manager will appear to employees. Using common sense can avert a lot of problems in the office, while failing to use it can cause them. Union organizing campaigns can often be traced back to an abrasive manager, for example. Employees who feel respected and valued are most likely to work hard, be productive, and perform well. Employees who feel disrespected and undervalued often don’t give their best efforts, and quite a few of them get litigious.
Not a good way to start off your CEO-ship, Robert California. Did you miss the day of kindergarten where you were supposed to learn the golden rule? Think of how you’d respond if you spotted your name on a list made by your boss, and didn’t know what it meant. Would it be a delightful puzzle or a source of added stress? And then, if you found out it was because your boss thought you were a “loser,” would you be trying to prove him wrong, or would you be polishing your resume? I’m not talking about writing a note to the file of an employee you think shows great promise, to watch out for advancement opportunities for the person – that’s fine. But the list was immature, in poor taste, and set up a possibly serious workplace morale problem.
One good thing did come out of the whole debacle, though – Andy got to show what kind of manager we can expect him to be. Although he was understandably nervous around the new CEO, he went to bat for his team and showed California exactly why he shouldn’t leap to conclusions about people before getting to know them. Andy even found kind words to say about Meredith. He showed, dare I say, a Michael Scott-esque commitment to his people. I’ve always thought Michael’s best quality was the way he valued his team, and Andy showed that he values them just as highly and is just as willing to stick his neck out for them. Good on you, Andy. Ezra Cornell would be proud. And so would Michael Scott.
This blog post originally appeared in “That’s What She Said” on September 23, 2011. Reprinted with permission.
“That’s What She Said” is a Ford & Harrison blog about labor and employment issues revolving around themes from the hit TV show, The Office. Ford & Harrison “is a labor and employment law firm with a national practice in all aspects of labor and employment law. Close to 200 labor and employment lawyers in 21 offices across the country, as well as 3 of counsel affiliate offices, strive to provide clients with sound legal advice, practical counseling and excellent client service.”
About the Author: Jacyln West concentrates her practice on labor relations and employment litigation representing management. Her practice encompasses all areas relating to the counseling, training and representation of management clients in federal and state courts, as well as before state and local agencies and in arbitration.
Friday, September 23rd, 2011
Plaintiffs suing Costco for sex discrimination face another round of litigation thanks to the Supreme Court’s recent dismissal of the Wal-Mart sex discrimination case. Because of the Supreme Court’s decision, the Ninth Circuit Court of Appeals ruled on Friday that the Costco trial court must reconsider whether the plaintiffs can prove that the company should be liable for sex discrimination in store-level promotions. On this question the Court of Appeals, like the Supreme Court before it, ruled the wrong way, discouraging companies from implementing measures that would prevent discrimination.
When companies leave employment decisions like promotions to individual decision-makers without giving them clear, relevant criteria to guide their decisions, those decisions are often discriminatory, albeit sometimes unintentionally. Many corporations, including Costco, provide no uniform criteria – or any guidance at all – for making promotion decisions. This leaves each individual manager (the vast majority of whom are male at Costco) to make promotion decisions as he sees fit. When making decisions with unfettered discretion, people tend to rely on stereotypes and to promote those they are most comfortable with and who are most like them – in short, in the absence of clear criteria, men usually promote men. Witness Costco’s demographics: female lower-level managers at Costco are less likely to be promoted than their male counterparts. It appears that only two of Costco’s top 34 executives are women. The problem is not a shortage of interested or qualified women: Costco’s competitors have a much higher proportion of women in management than Costco does.
Companies can prevent this kind of discrimination. Sociological research shows that holding top management responsible for establishing and enforcing uniform, unbiased promotion criteria goes a long way. When companies provide managers with performance-related criteria for promotion decisions, managers can evaluate whether a candidate satisfies those criteria instead of making a gut-level decision based on personal relationship or other irrelevant factors.
Companies can also prevent sex discrimination in promotions by increasing the pool of candidates. When employees don’t know promotions are available, managers may not even consider qualified women for the positions – they may not know them well, or may rely on stereotypes to conclude that they don’t want promotions. The Costco case illustrates these consequences: the three women who sued desperately wanted promotions, but none of them ever applied for one – they couldn’t, because Costco did not accept applications, and they never knew when promotions were available anyway. An easy fix is to inform employees of promotion opportunities and invite applications. Interested women will throw their hats in the ring and managers will evaluate them based on the relevant criteria, resulting in more promotions of women.
The courts in Costco and Wal-Mart ruled the wrong way because they discouraged companies from adopting these measures. They held that corporations are not liable in class actions for the discretionary decisions of individual managers, creating an incentive for companies to wash their hands of preventing discrimination in their ranks. The more anarchic the system for decisions about promotions and other perks – raises, bonuses, etc. – the more insulation the company has from discrimination class actions. The Costco decision quoted the Supreme Court’s Wal-Mart ruling on this point: “demonstrating the invalidity of one manager’s use of discretion will do nothing to demonstrate the invalidity of another’s. A party seeking to [bring] a nationwide class [action] will be unable to show that all the employees’ Title VII claims will in fact depend on the answers to common questions.” In other words, if the only thing promotion decisions have in common is that managers make those decisions however they want, the company as a whole is not liable for resulting discrimination. In contrast, if the company disseminates guidelines for making promotion decisions that result in discrimination, the company can be held liable.
Smart companies will adopt best practices like enforcing uniform criteria for promotion decisions, both to retain and get the benefit of employing talented people and to avoid discrimination suits by individuals, which are not affected by the Wal-Mart and Costco decisions.
The Court of Appeals sent the Costco class action case back to the trial court for reconsideration, giving the plaintiffs another chance. But the trial court will labor under the higher court’s instruction (again, quoting the Wal-Mart decision) that it “must determine whether there was ‘significant proof that [Costco] operated under a general policy of discrimination.’” Proving that Costco operated under a general policy of laissez faire will not suffice to save this sex discrimination case.
This post originally appeared on Piper Hoffman-Rock the Boat: Law, Society, and Social Justice on September 22, 2011. Reprinted with permission.
About the Author: Piper Hoffman is a writer and employee-side employment lawyer. She holds degrees with honors from Harvard Law School and Brown University. Hoffman blogs regularly on law and social justice issues at piperhoffman.com.
Thursday, September 22nd, 2011
Mitchell Hirsch catches a whole bunch of discriminatory job listings showing up at CareerBuilder.com:
The latest examples appear two months after the National Employment Law Project (NELP) released a report detailing similarly exclusionary job postings this spring. Since then, federal legislation has been introduced that would ban hiring practices, including job ads, that discriminate against unemployed workers by excluding them from consideration for employment opportunities. As these harmful practices have attracted growing attention, one leading job site — Indeed.com — recently announced it would no longer post such exclusionary ads.
That’s even as the movement to ban such discrimination gains steam. Wednesday, Representatives Rosa DeLauro and Hank Johnson and Senator Richard Blumenthal, sponsors of House and Senate bills prohibiting discrimination against unemployed jobseekers, held a press conference on the issue, at which:
Congress today received a petition with 250,000 names in support of ending discrimination against the unemployed, said David Elliot, a spokesman with the Washington-based USAction, a federation of 22 state affiliates that advocates for human- service programs and support for public education.
Already, Rep. Louie Gohmert (R-Texas) took to the House floor to speak out against the idea as just creating another “protected class.”
Johnson said much of Republican objection is politically motivated.
“[Some Republicans] don’t want to see the president be successful.” He added the American people “are looking past the cynicism and they’re looking at their pocket books. … They want some action.”
There’s no question about the political motivations of Republicans—the question is if they’ll be willing to go to the mat against a bill simply saying that employers can’t flatly rule out hiring unemployed people, a type of discrimination a poll has shown people want banned by a two-to-one margin.
This post originally appeared at Daily Kos Labor on September 21, 2011. Reprinted with permission.
Disclaimer: The views of this post reflect those of the author and not of Workplace Fairness.
About the Author: Laura Clawson is labor editor at Daily Kos. She has a PhD in sociology from Princeton University and has taught at Dartmouth College. From 2008 to 2011, she was senior writer at Working America, the community affiliate of the AFL-CIO.
Wednesday, September 21st, 2011
No American has been immune to the challenges caused by the less-than-thrilling state of our economy. However, new statistics show that half of our population may be struggling a bit more than the other, more specifically the female half. The National Women’s Law Center (NWLC), in a new compilation of statistics, reports that a record number of women are living in poverty.In 2010, the poverty rate among women climbed from 13.9 percent in 2009 to an astonishing 14.5 percent, the highest rate reported in over seventeen years. In addition, the percentage of women living in extreme poverty climbed from 2009’s 5.9 percent to 6.3 percent in 2010.
If those statements alone haven’t shocked you enough, the following ratio is even more daunting:
Over 17 million women lived in poverty in 2010, including more than 7.5 million who are living in extreme poverty.
Americans are witnessing a startling and rapid growth in the depravity of a major class of individuals in our nation. This has a large effect on the status of American children as well. Although men and women both play integral roles in the success and survival of a child, child welfare has long been attached to that of their mothers. When the mother suffers, so does the child- or so the numbers show. The NWLC reports that black women, who serve as the heads of black households with children, are continuing to lose jobs while black men are adding jobs during recovery. With fewer jobs, women are unable to provide for their children. The growing number of women in poverty is in turn increasing the number of children in poverty. A survey of child welfare released by the Annie E. Casey Foundation reports that in 2009, 14.7 million children were living in poverty.
The Guttmacher Institute reports that the rate of unintended pregnancies among women who fall below the federal poverty line has risen. With more women in poverty bearing children who will be born into poverty, the problems continue to grow. That’s the sad part-a child doesn’t get to choose what kind of life it is born into.
In an upcoming study in Psychological Science, a journal published by The Association for Psychological Science reports “the stresses disadvantaged children undergo affect their physiological development, making them permanently vulnerable to infection and disease. One common outcome in adulthood is metabolic syndrome, a cluster of signs, including high blood pressure, impaired regulation of blood sugar and fats, and fat around the waist, that can precede chronic diseases such as diabetes and heart disease.” However, the study posits that the presence of a “good mom” can radically change the fate of these children. We can hope that these women are committing to the job of motherhood, but it can only be expected that the pressures of poverty may prevent them from providing the best for their child.
The poor status of our economy continues to raise unemployment figures, lower the number of jobs available, and eliminate funding for welfare, health care, and other aid organizations. Women may not be climbing out of poverty anytime soon – Neither will their children. With that in mind, it seems apparent that some Americans are in the midst of a very vicious cycle.
About this Author: Maria Saab is a law student intern at Workplace Fairness. Her Bachelor of Arts in International Studies combined with her career experiences working on Capitol Hill and with then-Senator Barack Obama’s presidential campaign in 2008 encouraged her to pursue law school. As a hopeful lawyer, she plans on specializing in regulatory law and hopes to one day concentrate her work efforts towards policy development.
Tuesday, September 20th, 2011
Cliff Palefsky of McGuinn, Hillsman & Palefsky disputes the assertion that sending a case to arbitration has no impact on substantive rights; that faulty premise, he contends, underlies much of the Court’s arbitration jurisprudence.
The Supreme Court has told us repeatedly that judges do not create public policy. Public policy, they say, must emanate from the Constitution or a statute passed by Congress. Docket clearing is not a public policy and the FAA did not and could not create a public policy that conflicts with the express mandates of the Constitution.
But if the goal of the Supreme Court’s jurisprudence on arbitration was to fulfill its judicially created public policy of “docket clearing,” it has failed. In the past few Terms the Supreme Court has heard at least eight significant arbitration cases. Courts of appeals across the country are inundated with arbitration issues and trial courts are hearing contested motions to compel arbitration on a daily basis. The reasons are obvious. Arbitration was always intended to be a voluntary process, or as the Court itself has declared, a matter of “consent and not coercion.” It says that but it doesn’t really mean it. And parties who do not want to arbitrate and who do not trust the forum designed and imposed on them by a stronger party will use all available legal tools to avoid it. The mere act of forcing an arbitration program that you designed on an adverse party is inconsistent with the confidence in the process any justice system needs to succeed. As a result of failing to distinguish between voluntary and coerced arbitration in its jurisprudence, the Court has actually dramatically increased the workload of the appellate courts and done serious damage to the Constitution and many of the most important laws passed by Congress.
But equally important, and ironic, is the fact that by further eliminating the safeguards of a fair arbitration process as the Court did this Term in Concepcion and last Term in Rent-A-Center v. Jackson, the Court has actually undermined the viability and integrity of the arbitration process and in doing so has done great harm to the credibility of all of the effective voluntary forms of ADR which might actually help provide more efficient justice to so many and help reduce the backlog in the courts.
Real consent was always intended to be the only check and balance necessary to ensure fairness and to keep these matters out of the courts. By ignoring and distorting the requirement of consent, the Court has opened the door to every permutation of abusive and unfair arbitration process. As a fundamental concept, you can’t turn an adversarial system over to one side and invite it to design and control the process. It is thus no surprise that the abuses are getting all the attention and all of the positive attributes of voluntary ADR processes are lost in the noise.
It is easy to identify some of the ways in which the Supreme Court lost its bearings. It is also pretty easy to identify ways to make their future jurisprudence more faithful to the Constitution and restore the promise of voluntary forms of ADR.
It would be malpractice for any lawyer to tell a client that arbitration and our public court system are equivalent fora. Indeed, they are exact opposites in every material defining characteristic – public versus private, free versus costly, full discovery versus limited discovery, obligation to properly apply the law versus legal errors must stand, appeal versus no appeal. Arbitration is not just a change of venue, and it is not “just another forum”. And pretending that it is is the modernday version of “separate but equal”. The assertion that sending a case to arbitration has no impact on substantive rights is simply false as a matter of fact, yet that is the essential underpinning of much of the Court’s jurisprudence. It isn’t even accurate to describe mandatory arbitration as a ‘justice system” because its goal is finality – not necessarily reaching the correct result. As the Court announced in Hall Street Associates v. Mattel, under the FAA even facially incorrect legal rulings must stand and the parties can’t even agree to expanded review to make sure the laws of Congress are properly applied. In a voluntary context, parties are free to flip a coin to resolve a dispute or agree to be bound by an incorrect ruling. But in a non-consensual setting, the weaker party is being deprived of the ultimate substantive right – the right to have statutes that were passed for its protection interpreted and enforced correctly – in other words, due process. Asserting that arbitration is ‘just another forum” disrespects the very reason for the creation of a public court system and the Supreme Court itself since arbitrators are not even required to properly apply Supreme Court precedent.
An agreement to arbitrate involves the waiver of several constitutional rights: the First Amendment right of petition, the Fifth Amendment right to due process and the Seventh Amendment right to a jury trial. And to be sure, there are numerous statutes that expressly provide for the right of access to a federal court, which is obligated to follow the law. But incredibly, the Supreme Court has never acknowledged the waiver of constitutional rights inherent in an agreement to arbitrate and has never specifically considered the constitutionally required standard for such a waiver. In every other context, the waiver of those rights must be ‘knowing and voluntary’. The Court has repeatedly avoided this required analysis by ignoring the issue of consent entirely or by falsely proclaiming that the FAA requires courts to treat an arbitration clause as it would any other contract.
The FAA contains no such mandate, nor could it. It is a mere statute and does not have the power to reduce the constitutionally required standard for the waiver of constitutional rights. When Congress passed the FAA in 1925 its express intent was to “permit” courts to enforce voluntary and otherwise valid arbitration agreements as they would other contracts. It certainly did not, and could not, mandate them to enforce involuntary and non-consensual waivers of constitutional rights. The FAA is only constitutional to the extent the underlying agreement is knowing and voluntary. Aside from the magical preemptive powers over state laws bestowed upon it, the Court has also granted it the power to trump the most fundamental dictates of the U.S. Constitution.
The surest way to fix much of what is wrong with the Court’s arbitration jurisprudence is to acknowledge that the order compelling arbitration and the entry of judgments obtained in arbitration are forms of state action in the performance of a traditional “public function.” The Court needs to distinguish between truly voluntary agreements and “adhesion contracts,” which are really just a privilege extended to businesses to facilitate the inclusion of normal and customary commercial terms into a routine transaction. Adhesion contracts, especially in the employment context, are simply not sufficiently voluntary to support the waiver of constitutional and statutory rights. Adhesion contracts in most contexts are considered “procedurally unconscionable”. “Procedurally unconscionable” is the opposite of knowing and voluntary, and although an adhesion contract might be a vehicle for setting normal commercial terms, it can’t be an appropriate device for the forfeiture of constitutional and statutory rights.
The employment relationship is unique. The NLRA, the Norris LaGuardia Act, and numerous other federal statutes acknowledge both expressly or impliedly that agreements between companies and individual employees required as a condition of employment are not really voluntary. Indeed, most of these laws were passed because of the failure of the free market to protect workers.
It is interesting to compare the Court’s concern with the newly required “knowing” consent to class arbitration in Stolt-Nielsen S.A. v. AnimalFeeds International and Concepcion (when the issue is whether or not the corporation that created and crafted the arbitration agreement agreed to class arbitration), with its total lack of concern with consent when it is a consumer or employee objecting to the forced arbitration. Similarly, the Court doesn’t hesitate to declare that arbitration is favored and ‘just another forum” with no impact on rights when it is imposed on a consumer, but at the same time to declare it a wholly arbitrary and inadequate process for the resolution of class actions – as Justice Scalia wrote in Concepcion.
Legal historians and academics are already looking at the Court’s arbitration jurisprudence as one of the low points in the Court’s history. And in that review, Concepcion will certainly be the lowest point . . . so far. In Concepcion, the Court spent most of its time explaining that it was improper to force a company to arbitrate a class action because of the deficiencies of arbitration – even though the lower court had done no such thing, but had instead merely held that the class action should proceed in court. The Court violated the express terms of the FAA and preempted state law protections of general application against unconscionable and unfair arbitration agreements and replaced them with nothing. It shockingly expressed concern for the unfairness to corporate defendants of having to be bound by an incorrect result while inflicting that unfairness on consumers and employees without any concern whatsoever.
Mandatory arbitration is a cancer in our justice system based on a phony public policy and legal and factual fictions. In recent years Congress has passed numerous statutes prohibiting mandatory arbitration in many different contexts – for example, whistleblower claims under Sarbanes-Oxley, Title 7 claims against defense contractors, military lending agreements, auto dealer and farm contracts – while also expressly empowering the SEC and the new Consumer Financial Product Agency to prohibit mandatory arbitration clauses to protect investors and consumers. Those, along with the Constitution, are the real contemporary public policies. Public policy may encourage the truly voluntary use of alternative processes but it does not favor coerced and mandatory arbitration. Never did and never will, no matter how many times they say it.
This post originally appeared on the SCOTUS Blog on September 14, 2011. Reprinted with permission.
About the Author: Cliff Palefsky is a nationally renowned employment and civil rights lawyer who has argued cases before the Supreme Court and testified before National and State legislative committees. He has been described as a “force of nature” due to his involvement in many of the leading cases and legislation that have come to define the field of employment law. Mr. Palefsky has contributed his knowledge and expertise to drafting the first pieces of legislation concerning worker privacy, drug testing and lifestyle discrimination laws. He is the founder of the National Employment Lawyers Association. Today, Mr. Palefsky serves as a partner to the San Franciscio Bay Area firm McGuinn, Hillsman & Palefsky.
Monday, September 19th, 2011
Last week, Wal-Mart announced the latest component of its relatively successful campaign to shift its image from corporate villain to socially responsible role model.
The company promised that it would double its business with women-owned contractors and suppliers in the U.S. and internationally, and educate and train hundreds of thousands of women through its nonprofit Wal-Mart Foundation. That means the company will buy products from more women-owned factories and farms and hire more women to construct its stores.
The move comes after Wal-Mart was up against the largest sex-discrimination class-action lawsuit in history, until the Supreme Court threw it out this summer.
Most labor and social justice advocates are glad to see any corporation change its practices in the face of social and economic pressure, so Wal-Mart’s recent announcement and its other recent efforts, such as contracting with minority suppliers, adopting sustainable environmental practices and increasing diversity and fairness in its stores, can be seen as small victories for campaigns that expose Wal-Mart’s practices.
But many labor and watchdog groups are still skeptical of the mega-corporation’s sincerity and the larger significance of its corporate responsibility initiatives, and they are calling on the company to continue examining and reforming its practices in a big way.
Jennifer Stapleton is spokesperson for Making Change at Wal-Mart, a campaign of the United Food and Commercial Workers international union. She said in a statement last week:
Wal-Mart’s latest PR gambit is trying to cover up decades of unjust treatment of women, but women know better. Wal-Mart causes systematic economic harm to women in the U.S. and around the world, and that is precisely why Wal-Mart is trying to sell us on a new image. Wal-Mart keeps millions of women in the U.S. and around the world in poverty, fails to protect women from unacceptable sexual and other forms of workplace harassment and works many women to the bone in sweatshop conditions around the globe. And, according to the women in the Dukes v. Wal-Mart gender discrimination law suit, Wal-Mart pays women less than men.
In May and June, a group called Organization United for Respect at Wal-Mart (OUR Wal-Mart) surveyed 501 Wal-Mart associates. On a number of questions about pay, fairness and opportunity, women were consistently less satisfied and felt treated less fairly than male workers, by margins of about 10 to 25 percent, depending on the question.
More than half the workers answered that conditions were “poor” or “fair” in terms of having dependable schedules, opportunities for advancement and training, just procedures for discipline and termination and other measures.
These answers imply a mediocre to substandard employment situation–not overwhelming dissatisfaction, but not as positive a result as one might expect from a company that has gone into overdrive to improve its image. Three-quarters of workers also said they thought under-staffing is a serious problem that has resulted in customer dissatisfaction and/or messy stores.
And given the lawsuit and the company’s recent announcement, the group stressed that the disparity between men’s and women’s answers is significant. A release quoted Lancaster, Calif.-Wal-Mart worker Maggie Van Ness saying:
If what’s going on at Wal-Mart happened at a small company, it would be bad enough. But because Wal-Mart’s the nation’s largest employer and sets standards for our communities and other companies, this is a full-scale epidemic. The data show widespread problems that are especially bad for women, who need these jobs.
Wal-Mart is the largest private employer of women in the U.S., with 808,000 women making up 65 percent of its domestic workforce as of 2001, according to a paper by Making Change at Wal-Mart. Between 1996 and 2001, women working at Wal-Mart earned on average $5,200 less per year than men, and were also much less likely to have salaried, upper-level management positions, according to a 2003 report. It also noted women in salaried positions earned $14,000 less per year than their male counterparts.
Last year, the Equal Employment Opportunity Commission negotiated an $11.7 million settlement with the company over complaints that at a Kentucky distribution facility, women were systematically discriminated against for certain positions that usually went to young males.
In light of Wal-Mart’s recent promise to increase business with women, Wal-Mart critics also point to the story of Margaret Garner, an African-American construction-business owner whom Wal-Mart had celebrated for her lead role in building its controversial first Chicago store, on the city’s impoverished West Side. Four years after it opened, Wal-Mart has billed that store as a success and planned dozens more stores for Chicago. But Garner’s firm declared bankruptcy last year, driven by $11.9 million in debt from cost over-runs on the Wal-Mart, as reported by Crain’s Chicago Business. The Crain’s investigation explains that Garner’s firm, which received incentives under city programs for minority contractors, sent most of the actual work to firms owned by white males. Garner’s firm sunk into debt when it couldn’t pay those companies as promised.
Also, a University of Illinois at Chicago and Loyola University study alleges that the West Side Wal-Mart drove other local companies out of business, a long-standing complaint which Wal-Mart says is not borne out by facts.
But according to Making Change at Wal-Mart,
For decades, Wal-Mart has shown that when it “invests” in a community, that community can expect lost jobs, depressed wages, bankrupt local business, and lowering of labor standards to follow quickly. Women in the U.S. and around the world would be far better served if Wal-Mart would improve its labor practices, raise its wages, and use its power to stand up for human rights instead of undermining them through its day-to-day business practices.
This post originally appeared in Working in These Times on September 19, 2011. Reprinted with permission.
About the Author: Kari Lydersen is an In These Times contributing editor, is a Chicago-based journalist whose works has appeared in The New York Times, the Washington Post, the Chicago Reader and The Progressive, among other publications. Her most recent book is Revolt on Goose Island. In 2011, she was awarded a Studs Terkel Community Media Award for her work. She can be reached at firstname.lastname@example.org.