This Monday, the Supreme Court dealt a blow to workers’ rights by ruling that workers cannot band together to challenge violations of federal labor laws. The ruling in Epic Systems Corporation v Lewis was a polarizing—and for many, devastating—decision, but it was widely anticipated, based on legal history and the current makeup of the Court. Justice Neil Gorsuch, writing for the majority, said, "The policy may be debatable, but the law is clear.”
That’s the crux of this week’s Sunday Issue. Though the court system can often protect workers, it’s not their main role. Policymakers, on the other hand, have an obligation to protect American workers, the backbone of our economy. Through the last few decades, workers have become increasingly unequal in interactions with their employers; the Economic Policy Institute shows that the use of mandatory arbitration has risen to cover nearly 55 percent of private-sector nonunion workers today, or nearly 60 million Americans, up from only a quarter in the early 2000s. Today, we’ll talk about how workers can respond to this ruling, other significant upcoming cases on workers’ rights, and what Congress and state governments can do to protect them.
Summary of the Epic Systems Case
The legal background of the case involved three individual employees at different companies, who were required to waive their rights to join class-action suits as part of their contracts. These employees sued, citing the right to collective action. The court, in a 5-4 decision, ruled that these kind of contracts are legal, and the Federal Arbitration Act, which allows employers to resolves disputes individually through arbitration, trumps the National Labor Relations Act, which guarantees workers' right to collective actions.
Though the precedent was clear, the decision was still polarizing. Justice Ginsburg even read her dissent from the bench, an unusual move, indicating how strongly she was opposed, calling it “egregiously wrong.”
What this means in practice is that it will be much harder for works to participate in class-action lawsuits in the future. Likely, all employers that can will now use binding arbitration contracts, to prevent the high cost of class-actions. Additionally, studies have shown that arbitration overwhelmingly favors employers. Inevitably, without the ability of workers to use class-actions to bring pressure against employers, workers are more likely to suffer from underpaid wages, sexual or racial harassment, or violations to the Americans with Disabilities Act.
Few workers will pursue these claims as individuals, especially those regarding wages. Under the Fair Labor Standards Act, workers could band together to secure overtime that hadn’t been paid, or to receive the federal minimum wage. Individually, each of these claims might be only a few hundred dollars, which is far less than the legal fees it would take to secure them. Class-action lawsuits, though costly and time consuming to all involved, are crucial for low-income workers: they give employees “safety in numbers”, can protect against retaliation, and can help cover legal fees.
Janus v AFSCME
The other critical workers’ rights case on the docket this year is Janus v AFSCME, which I wrote about a few months ago when oral arguments were heard. Janus will settle the question of whether unions can legally charge “fair-share fees” for public sector workers who do not want to be union members, but who still benefit from collective bargaining.
The Court is expected to rule in favor of Janus, which will undoubtedly ruin the bargaining power of unions. Not only will unions lose funding from fair-share fees, but membership is likely to decline, as some members may quit when they realize they can still gain the benefits of collective bargaining without paying.
Together, the rulings in Epic Systems and Janus will likely severely reduce the power of workers in collective bargain and class-action lawsuits, to critical sources of worker power in employer relations.
Next Steps for Congress
An unusual part of the Epic Systems decision is that justices in both the majority and the dissent spoke about the distinction between the law and policy in their opinions. Writing for the majority, Justice Gorsuch said “the policy may be debatable, but the law is clear.” In her dissent, Justice Ginsburg said that it was up to Congress to correct the Court’s action.
In this case, the change is a relatively clear one: Congress could change the National Labor Relations Act so that it does override the Federal Arbitration Act. Or, they could go a step farther and ban the use of mandatory arbitration agreements for certain issues, such as the Ending Forced Arbitration of Sexual Harassment Act, a bill proposed in the Senate last year by Senator Gillibrand (and co-sponsored by Republican Sen. Lindsey Graham), that would forbid arbitration for sexual harassment claims.
There’s also a number of steps that state and local governments can take to protect workers. They could require government contractors to agree to not use individual arbitration clauses on workers, the same way contractors are required to not discriminate. State and local governments could also require that employers be more transparent about the presence of arbitration contracts, so at least new employees or applicants are aware of the limits on their rights when applying to jobs.
Workers are already at a disadvantage when dealing with their employers, and this recent decision only exacerbates that difference. Arbitration overwhelmingly favors employers, and is more likely to be used by companies that employ low-wage, female, or minority workers. It is the responsibility of Congress to protect the underdog in America, the hard worker who is just trying to play by the rules and make a living. As a private citizen, I have always supported the rights of workers, and as an elected official I plan to do the same. It’s time for this Congress to start standing up for Americans.