Employment Law Attorneys
Hidden Arbitration Clauses: What You Don’t Know CAN Hurt You

Hidden Arbitration Clauses: What You Don’t Know CAN Hurt You

Employers are opting increasingly for forced arbitration as a tool to prevent their employees from seeking justice against them in court. A form of private dispute resolution, an effective arbitration agreement forces the parties to submit their dispute to a professional arbitrator (usually chosen by the employer), who will decide the result. The arbitrator’s decision is final: It is legally binding and cannot be appealed in court.

The Problem with Forced Arbitration

Forced arbitration comes at a tremendous cost to employees, who will no longer have their day in court.  As a result, their right to fair treatment on the job is inevitably compromised.  Even a favorable monetary arbitration award can feel like a hollow victory for an employee who has suffered years of discrimination at the hands of their employer.  For a large company in particular, even a high six-figure payout is effectively nothing but a slap on the wrist. A license to continue their unfair employment practices.

An employee’s real bargaining power comes from the public nature of the court system. By signing mandatory arbitration contracts, employees are waiving their fundamental, constitutional right to a trial by a jury.

According to a recent study, nearly 52% of employees are subject to mandatory arbitration procedures. “Extrapolating to the overall workforce, this means that 60.1 million American workers no longer have access to the courts to protect their legal employment rights and instead must go to arbitration.” Alexander J.S. Colvin, Economic Policy Institute, EPI.org.

Workers’ Rights Put at Risk

Just a few weeks ago, the Supreme Court ruled 5-4 in NLRB v. Murphy, that employers can include employment contract clauses forcing employees to arbitrate their disputes individually, and waiving the right to resolve those disputes through joint legal proceedings.  In a rambling, logically incoherent majority opinion, Justice Gorsuch asserted, “[t]he policy may be debatable but the law is clear: Congress has instructed that arbitration agreements like those before us must be enforced as written.”

This decision paves the way for companies to strip workers of the right to pursue class action suits in cases of widespread discrimination. In her written dissent, Justice Ginsberg cautioned, “[t]he inevitable result of today’s decision will be the underenforcement of federal and state statutes designed to advance the well-being of vulnerable workers.”

Savvy employers are well aware of the advantages provided to them by private arbitration.  They are becoming ever more creative in finding places to bury mandatory employment arbitration clauses to ensure that their employees are bound by them.

The Supreme Court’s decision in the Murphy case left unanswered, the question of what constitutes valid “notice” to an employee.

Consider the case of an employer who sends an arbitration agreement through a company-wide email, requiring any employee who does not agree to be bound by mandatory arbitration to opt out proactively.  Are all employees who have not opted out of the agreement still bound by its terms, even if they never opened the employer’s email?

In another case, the employing company placed a mandatory arbitration clause within the text of the legal disclaimers included in its employment application.  In order even to be considered for a position, a potential employee is required to find and agree to mandatory arbitration.

Fighting Workplace Discrimination

The Supreme Court’s decision in NLRB v. Murphy will have significant consequences for the ability of employees to fight back against discrimination on the job.  Despite the unequal bargaining power inherent in employer-employee agreements, the decision marks a victory for companies seeking to avoid liability for the mistreatment of their employees.

It remains to be seen how the court will handle the issue of hidden arbitration clauses, whether long-standing contract principles requiring notice to both parties will become a thing of the past as well.

The following companies use forced arbitration clauses: Morgan Stanley, Hooters, Forever 21, Nordstrom, Neiman Marcus, Macy’s, Yahoo, Dillard’s, Manpower, Carrols, Papa John’s Pizza, Xerox, Amazon, Ford, GE, Coca-Cola, CVS, ExxonMobil, Bridgewater Associates, Glencore, RBS, Barclays, Tradeweb, Boehringer Ingelheim Pharmaceuticals.

Have employment questions? Need help with a case? The employment lawyers at Carey & Associates, P.C. handle each and every aspect of employment litigation and appellate work and act as the story tellers of our client’s personalized narrative to the company, the court and the jury.  Contact us today!

Pregnancy Discrimination: Going Beyond Nine Months

Pregnancy Discrimination: Going Beyond Nine Months

Reports have shown that pregnant women and new mothers are suffering increasing levels of unfair treatment at work, including cuts to their work hours, zero-hour contracts or even undergoing forced removal from their jobs.

Laws Protecting Pregnant Employees

The Pregnancy Discrimination Act of 1978 ensures that pregnant employees or “women affected by childbirth,” are treated the same as childless workers. In addition to federal laws protecting pregnant employees from discrimination and ensuring that they receive family leave benefits, many states and localities also have passed laws giving additional protections and rights to pregnant employees.

Most states have passed laws requiring employers to provide reasonable accommodations to pregnant workers.  The Connecticut Fair Employment Practices Act was recently amended, making it unlawful for an employer to refuse reasonable accommodations for an employee due to her pregnancy or to limit, segregate, or classify her in a way that would deprive her of employment opportunities due to pregnancy.  The law also expands the definition of “pregnancy” to include related post-pregnancy conditions, such as lactation (PA 17-118).

What is Pregnancy Discrimination

The term, “pregnancy discrimination” is deceptive. Courts are only just beginning to define the parameters of what can be considered “on the basis of pregnancy.” Although a pregnancy itself is limited in time to a discrete period, the discrimination faced by a pregnant woman often continues long after the birth of her baby.

Federal law and the antidiscrimination laws of most states consider pregnancy and pregnancy-related conditions, such as lactation, to be protected. But the definition becomes more blurred, for example, in the context of a mother returning to work from maternity leave, only to find out that she has been demoted or placed in a new position.

Sometimes an employer’s discriminatory action won’t take place for months, or even years, following an employee’s pregnancy.  Years after her pregnancy, a female employee will notice that she is repeatedly passed over for promotions.  Despite her hard work and positive performance, her male and childless coworkers are given opportunities that she is not.

This phenomenon has been dubbed, the “motherhood penalty,” and is extremely common in today’s workplace.  According to recent studies, about three quarters of working mothers say they have experienced discrimination in the workplace.

Research shows that mothers are significantly less likely than either childless women, or fathers with identical qualifications, to get interviews. In addition, regardless of whether women work less after having children, employers pay them significantly less over time, assuming they will be less committed.  When mothers do cut back their work hours, their pay is disproportionately reduced.

Consider two specific examples of discrimination on the basis of motherhood responsibilities;

New Supervisor Syndrome – A working mother performs well and has no significant problems at work until her supervisor changes. The new supervisor cancels her flexible work arrangement, changes her shifts, or imposes new productivity requirements. On occasion, the new supervisors will even make comments indicating that these actions have been taken specifically to push mothers out. In other instances, a working mother may be targeted for termination under the biased belief that she is not as committed to her job or as productive as other employees who are not female and do not have childcare responsibilities.

Second Child Bias  Some mothers have reported experiencing little discrimination until they become pregnant with their second child. After informing her employer of her second pregnancy, a working mother is suddenly faced with questions about whether she intends to return to work after maternity leave and how she can continue working with two children. Some supervisors openly counsel women who are pregnant with their second child to stay at home, deny promotions or other opportunities, treat them rudely or ignore them, or make the work vs. home decision for them by terminating them. The assumption behind these actions appears to be that a mother can handle one child and work, but two is too much.  www.worklifelaw.org/pubs/FRDupdate2016.pdf

Defining Motherhood Discrimination

Not neatly categorized as pregnancy or gender discrimination, motherhood discrimination occurs when an employee suffers an adverse employment action based on unexamined biases about how female workers with childcare responsibilities will or should act, without regard to her actual performance or preferences.

Discrimination based motherhood often occurs in the context of failure to hire or to promote, demotion, transfer to dead-end jobs, removal of sales territory or responsibility, increase or strict enforcement of goals for mothers but not others, discipline for actions that do not result in discipline for non-mothers, humiliation or harassment, selection for layoff despite seniority and strong performance and termination for reasons that are not accurate or legitimate.

No federal or Connecticut statute expressly prohibits employment discrimination or retaliation based on motherhood responsibilities. In many situations, a court will rely on laws regarding pregnancy discrimination in analyzing a claim more aptly categorized as, “motherhood responsibilities discrimination.” A working mother may prevail by showing, for example, that because of her pregnancy, she was treated differently from employees who had not been pregnant.  Sometimes, the difference in treatment occurs after she returns from maternity leave, based on her employer’s assumption that because her childcare responsibilities will impact her work.

Gender discrimination laws have also been used in analyzing claims of motherhood discrimination.  Title VII does not prohibit discrimination on the basis of family responsibilities alone, but rather “gender plus” an additional status, in this case, childcare giver.

“Sex plus” or “gender plus” discrimination, involves a policy or practice by which an employer classifies employees on the basis of sex plus another characteristic.  It is actionable under Title VII, state law, and the Equal Protection Clause, which forbids sex discrimination regardless of how it is labeled, as long as there is evidence of purposefully sex-discriminatory acts. Back v. Hastings On Hudson Union Free Sch. Dist., 365 F.3d 107 (2d Cir. 2004).

The “sex plus” framework was used to analyze a female employee’s claim that her employer failed to promote her because of a sex-based stereotype that women who are mothers neglect their jobs in favor of their presumed child care responsibilities. Chadwick v. WellPoint, Inc., 561 F.3d 38 (1st Cir. 2009)

Such cases rest on the presumption that, “unlawful sex discrimination occurs when an employer takes an adverse job action on the assumption that a woman, because she is a woman, will neglect her job responsibilities in favor of her presumed childcare responsibilities.” Id at 44–45.

In accordance with Title VII, women have, “the right to prove their mettle in the work arena without the burden of stereotypes regarding whether they can fulfill their responsibilities.” Gingras v. Milwaukee County, 127 F. Supp. 3d 964, 975 (E.D. Wis. 2015).

If you feel that as a working mother, you have been the victim of discrimination by your employer, an employment attorney can help you determine what recourse may be available.

Get in touch today!

Jill Saluck is an employment attorney working in Connecticut for Carey & Associates, P.C. She can be reached at (203) 255-0380.