End Forced Arbitration to Honor Justice Ginsburg’s Legacy

In one of her most significant dissents in recent years, in 2018’s Epic Systems Corp. v. Lewis, U.S. Supreme Court Justice Ruth Bader Ginsburg sounded the alarm over a corporate tactic that prevents workers from joining together to challenge employer misconduct.

Many of the landmark civil rights cases RBG participated in as a lawyer and as a jurist could never have been filed if this tactic—companies requiring employees to sign away their legal rights in the fine print—had been as widely used as it is today.

Forced arbitration denies workers the right to go before a judge and jury when their employer breaks the law. These requirements can be imposed on workers when they start a job or at any time after they’ve been hired. Employers typically include them in the boilerplate language of a worker’s employment agreement, which workers have no power to negotiate. But workers don’t even need to sign anything; an employer can simply amend its handbook to impose forced arbitration.

Instead of going before a judge and jury, workers must bring any claims to a secret proceeding before a private arbitrator who is not accountable to the public. And because these arbitrators depend on corporations for repeat business, they strongly favor employers.

Today, 56% of non-union private-sector employees are subject to forced arbitration requirements, including over 64% of workers earning less than $13 per hour, 59% of Black workers, and nearly 58% of women workers.

Employees Are Prevented From Banding Together

Making matters worse, class and collective action waivers, which are routinely incorporated into forced arbitration requirements, prevent employees from banding together to challenge employer lawbreaking. Instead, the workers are forced to proceed in arbitration alone, without their coworkers.

In Epic Systems, workers sought the right to sue their employer as a group to redress violations of wage and hour laws—but the employer sought to thwart them with forced arbitration and class waivers. As Ginsburg understood, the workers’ individual claims were relatively low-dollar, providing little incentive to workers or attorneys to pursue on their own. “But by joining together with others similarly circumstanced,” she noted, “employees can gain effective redress for wage underpayment commonly experienced.”

This is no less true in the context of rooting out workplace discrimination. As recognized by Ginsburg, many cases that shaped the metes and bounds of what we today consider to be race or sex discrimination were brought as class actions—and could not have been brought or have succeeded as individual actions.

For example, in 1977’s Dothard v. Rawlinson, had plaintiff Diane Rawlinson been forced to proceed alone in challenging the state of Alabama’s height and weight requirements for prison guard job applicants that effectively shut women out of those jobs—which the state claimed were merely “bona fide occupational qualifications”—she likely would not have bothered, or succeeded. But because she could bring a class action, she was able to pursue—and win—justice.

In Epic Systems, Ginsburg recognized that without class and collective actions, employees will be unable to combat rampant wage theft, because under-resourced government agencies “must rely on private parties to take a lead role in enforcing wage and hours laws.”

Ginsburg predicted the “inevitable result” of the majority’s decision—which required courts to enforce employer-imposed forced arbitration requirements with class/collective action waivers—would be the “underenforcement” of federal and state minimum wage and overtime laws.

Her prediction was spot-on: In 2019 alone, individual forced arbitration requirements enabled employers to steal $12.6 billion in wages from low-paid workers. Such wage theft has the greatest impact on Black, Latinx, and other workers of color and immigrant workers disproportionately represented in low-paying jobs.

Faced with the reality of proceeding alone against their employer in a stacked forum, 98% of workers whose claims are subject to forced arbitration abandon their claims. By 2024, it is projected that 80% of non-union, private-sector workers will be subject to individual forced arbitration requirements.

FAIR Act Would Restore Workers’ Rights

In her Epic Systems dissent, Ginsburg called on Congress to correct the court’s grievous error, and members responded. Passed by the House in a bipartisan vote in September 2019, the Forced Arbitration Injustice Repeal (FAIR) Act would render employer-imposed forced arbitration requirements and class/collective action waivers invalid and unenforceable.

The FAIR Act would, in short, restore workers’ rights to collectively hold their employers accountable for lawbreaking before judges and juries—effectively ending forced arbitration.

To honor RBG’s legacy and answer her charge, the Senate should hold an up-or-down vote on the FAIR Act. And if this Senate fails to act, the next Congress and president must ensure the FAIR Act is at the top of their agenda.

This column does not necessarily reflect the opinion of The Bureau of National Affairs, Inc. or its owners.

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Author Information

Hugh Baran is a staff attorney and Skadden Fellow at the National Employment Law Project.