The Trump Administration’s Backdoor Plan to Erode the Rights of Workers to Act Collectively

Moshe Z. Marvit

U.S. President Donald Trump pictured at the Trump National Golf Club in Bedminster, New Jersey on August 12, 2017. (JIM WATSON/AFP/Getty Images)

On Octo­ber 2, the U.S. Supreme Court will hear a case that impli­cates the very con­cept of col­lec­tive action. NLRB v. Mur­phy Oil asks whether it is a vio­la­tion of work­ers’ rights to force them to enter into arbi­tra­tion agree­ments that pro­hib­it col­lec­tive or class lit­i­ga­tion. Such agree­ments, often entered into as con­di­tions of employ­ment, require work­ers who want to sue their employ­ers to do so indi­vid­u­al­ly in a pri­vate arbi­tra­tion set­ting, rather than as a class of aggriev­ed work­ers who can pool their resources and knowl­edge. Accord­ing to a recent study by the Eco­nom­ic Pol­i­cy Insti­tute, more than 60 mil­lion U.S. work­ers have now lost access to the courts because of such forced arbi­tra­tion agreements. 

Now, the Trump admin­is­tra­tion is enter­ing the fray, sub­mit­ting a brief to the Supreme Court in the Mur­phy Oil case aimed at advanc­ing an anti-work­er legal the­o­ry poised to erode pro­tec­tions for work­ers out­side of the union context.

Such efforts could have far-reach­ing impli­ca­tions. In a 1997 paper for Ari­zona Law review, pro­fes­sor of law emer­i­tus Jack Green­berg argued, Civ­il rights and class actions have an his­toric part­ner­ship,” with class actions rou­tine­ly used to chal­lenge dis­crim­i­na­tion in employ­ment, edu­ca­tion, the use of pub­lic facil­i­ties and hous­ing, to assert pris­on­ers’ rights, and to pro­mote wel­fare reform, to name just a few areas that con­ven­tion­al­ly are put in the civ­il rights category.”

More recent­ly, the NAACP went fur­ther, argu­ing in an ami­cus brief sub­mit­ted in August 2016 to the Supreme Court that Amer­i­can democ­ra­cy depends upon our unwa­ver­ing com­mit­ment to equal oppor­tu­ni­ty. Fed­er­al labor law hon­ors that com­mit­ment by guar­an­tee­ing employ­ees the right to chal­lenge work­place dis­crim­i­na­tion through con­cert­ed activ­i­ty, includ­ing pick­et­ing, strik­ing and group adju­di­ca­tion of work­place rights.”

Yet, in recent years, the rights of most Amer­i­cans to engage in con­cert­ed legal has great­ly dimin­ished. In a 2015 inves­tiga­tive series on this trend, The New York Times report­ed that, start­ing in 1999, a Wall Street-led coali­tion of cred­it card com­pa­nies and retail­ers” — with soon-to-be Chief Jus­tice of the Supreme Court John Roberts Jr. involved — engi­neered a plan to get rid of class action law­suits, because such law­suits allow indi­vid­u­als to pool their pow­er against companies.

Years lat­er, in a pair of cas­es decid­ed in 2011 and 2013, with John Roberts Jr. as Chief Jus­tice, the Supreme Court nar­row­ly held that com­pa­nies could include con­tract pro­vi­sions that require plain­tiffs to go through arbi­tra­tion instead of court, while waiv­ing their rights to class actions.

A fed­er­al judge inter­viewed in 2015 by the Times explained that the result is that now, busi­ness has a good chance of opt­ing out of the legal sys­tem alto­geth­er and mis­be­hav­ing with­out reproach.”

The Times study of thou­sands of arbi­tra­tions — most of which are not pub­licly avail­able — found that more and more con­sumer and labor and employ­ment cas­es are being fun­neled into arbi­tra­tion. Between 2010 and 2014, there was a 215 per­cent rise in arbi­tra­tions in labor cas­es over the pre­vi­ous four years. This rep­re­sents a pri­va­ti­za­tion of the jus­tice system.

Fur­ther­more, in many instances, the fun­nel­ing of cas­es to indi­vid­ual arbi­tra­tions rather than class actions pres­sures work­ers into fore­go­ing the process alto­geth­er. Look­ing at 2010 to 2014, the Times found that Ver­i­zon and Time Warn­er Cable, which have 140 mil­lion sub­scribers com­bined, faced only 72 arbi­tra­tions. After all, who would go up against an out­matched oppo­nent alone?

It is under­stand­able that work­ers would bow out, giv­en that such arbi­tra­tion set­tings are favor­able to the employ­er. Unlike judges who are assigned cas­es ran­dom­ly, arbi­tra­tors are cho­sen by the par­ties, mean­ing they are cho­sen reg­u­lar­ly to arbi­trate before the same cor­po­ra­tions. If arbi­tra­tors against the cor­po­ra­tions too often, there is a strong like­li­hood that the arbi­tra­tors will not be cho­sen again and there­fore lose busi­ness in the future. This cre­ates a finan­cial incen­tive for arbi­tra­tors to side with cor­po­ra­tions. The Times series notes that dozens of arbi­tra­tors described how they felt behold­en to com­pa­nies. Beneath every deci­sion, the arbi­tra­tors said, was the threat of los­ing business.”

Var­i­ous attempts have been made to pro­tect indi­vid­u­als from these arbi­tra­tion pro­vi­sions, includ­ing state laws hold­ing these pro­vi­sions to be uncon­scionable, as well as legal argu­ments claim­ing that such pro­vi­sions vio­late fed­er­al anti-trust rules. But these argu­ments have failed at the Supreme Court. What has remained is the Nation­al Labor Rela­tion Board’s (NLRB) posi­tion that Sec­tion 7 of the Nation­al Labor Rela­tions Act (NLRA) pro­tects work­ers’ sub­stan­tive rights to join togeth­er in class actions. Sec­tion 7 pro­vides that work­ers have the right to self-orga­ni­za­tion, to form, join, or assist labor orga­ni­za­tions, to bar­gain col­lec­tive­ly through rep­re­sen­ta­tives of their own choos­ing, and to engage in oth­er con­cert­ed activ­i­ties for the pur­pose of col­lec­tive bar­gain­ing or oth­er mutu­al aid or protection.”

The NLRB has tak­en the posi­tion that employ­ment class actions con­sti­tute oth­er con­cert­ed activ­i­ties,” which are pro­tect­ed under labor law. And work­ers can­not sign away these rights, in the same way that they can­not sign away the right to form or join a union. The Sev­enth and Ninth Cir­cuit Courts of Appeals agreed with the Board that the employ­er vio­lat­ed work­ers’ rights by mak­ing them sign arbi­tra­tion agree­ments with class action waivers, but the Fifth Cir­cuit held otherwise.

This split in the cir­cuits made the issue ripe for Supreme Court review, and the mat­ter was indeed appealed to the Supreme Court in Sep­tem­ber 2016, and accept­ed for review by the Supreme Court in Jan­u­ary 2017. At the time, Pres­i­dent Obama’s Solic­i­tor Gen­er­al filed a brief with the Supreme Court sup­port­ing the NLRB’s posi­tion. But Trump’s Solic­i­tor Gen­er­al lat­er changed this posi­tion in order to side with employers.

In this case, the Trump admin­is­tra­tion express­es a view of labor law in the Solicitor’s brief that com­plete­ly reori­ents work­ers’ rights. The brief acknowl­edges that Sec­tion 7 of the NLRA con­tains what it terms core” rights, which relate to union­iz­ing and col­lec­tive bar­gain­ing, but push­es aside all oth­er con­cert­ed activ­i­ties as only con­tained in resid­ual lan­guage” and there­fore not deserv­ing of the same lev­el of pro­tec­tions. Such a read­ing of labor law effec­tive­ly states that the law’s pro­tec­tions only apply to work­ers’ activ­i­ties as they relate to unions.

How­ev­er, the NLRB clear­ly states that the law we enforce gives employ­ees the right to act togeth­er to try to improve their pay and work­ing con­di­tions, with or with­out a union. If employ­ees are fired, sus­pend­ed or oth­er­wise penal­ized for tak­ing part in pro­tect­ed group activ­i­ty, the [NLRB] will fight to restore what was unlaw­ful­ly tak­en away.” These rights are far broad­er than the Trump admin­is­tra­tion acknowl­edges in its brief before the Supreme Court, and any lim­i­ta­tion of them would great­ly dimin­ish the few rights work­ers have in the workplace.

This week, man­age­ment-side Repub­li­cans gained a major­i­ty on the NLRB, and soon a man­age­ment-side Repub­li­can will become the agency’s Gen­er­al Coun­sel. This new con­ser­v­a­tive Board is like­ly to shift labor law away from work­er pro­tec­tions, as was the case dur­ing the George W. Bush years. How­ev­er, Trump’s Solicitor’s argu­ment goes much fur­ther. It invites the Supreme Court to for­mal­ly bifur­cate and lim­it work­ers’ rights to act collectively.

Moshe Z. Mar­vit is an attor­ney and fel­low with The Cen­tu­ry Foun­da­tion and the co-author (with Richard Kahlen­berg) of the book Why Labor Orga­niz­ing Should be a Civ­il Right.

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