‘This Is Yet Another Example Of Why Workers Need Unions:’ More Than Half Of Maine Employers ‘May Be Forcing Workers To Sign Away Their Right To Sue’ - Worker Protections Threatened By Both Forced Arbitration & Lack Of State Enforcement
(AUGUSTA, MAINE) - An estimated 56% of Maine employers may have made it impossible for their Workers to sue them in court for Wage Theft, safety hazards, sexual harassment, racial discrimination or other violations protected by Labor Laws.
Companies can do this by making new Employees sign contracts that force them to resolve legal disputes outside of the courts, in private arbitration, which involves a mediator typically paid for by the employer.
The findings are a new extrapolation from a nationwide survey released in 2018 by the Economic Policy Institute (EPI), a Left-leaning Economic Think Tank.
The survey demonstrated that the use of “forced arbitration” is becoming an increasingly common hiring practice, denying Workers the right to trial by judge and jury.
The EPI projects Maine may be ahead of the national trend, with 53.9% of businesses in the U.S. estimated to have forced their Employees to sign Arbitration Agreements, compared to 56% in Maine.
Heidi Shierholz, the former Chief Economist in President Barack Obama’s U.S. Department of Labor and currently the Senior Economist at EPI, analyzed the likely number of Maine employers using Forced Arbitration Agreements.
Shierholz broke down how many workers in the national survey were affected by the practice in a given industry and compared that with the latest data from the Bureau of Labor Statistics (BLS) on the employment levels in those same sectors in Maine.
“A higher share of Maine’s employment is in retail and education and health services. Those industries have higher mandatory arbitration,” Shierholz explained. “That’s why Maine is likely higher than the national average.”
The growing use of forced arbitration by corporations is a relatively new development.
Prior to EPI’s 2018 survey, the one major investigation into the practice was conducted by the Government Accountability Office in 1995.
That survey found that only 7.6% of businesses were using Mandatory Arbitration Agreements at the time.
Shierholz and Labor Advocates around the country fear that a U.S. Supreme Court decision in 2018, Epic Systems Corp. v. Lewis, will encourage more businesses to seek to adjudicate allegations made against them outside of the courts.
In a 5-4 decision with a majority opinion authored by Justice Neil Gorsuch, the court ruled in favor of Epic Systems, a health care software firm that made it a condition of their employment to resolve any wage-and-hour claims through arbitration.
Their hiring contract further stipulated that their Workers could not pursue claims collectively through Class Action Lawsuits.
“Epic Systems ‘gives the green light to employers,’” Shierholz said. “The Supreme Court said, ‘That’s fine. You can prohibit the class and collective action of your Employees.’”
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