Forced Workplace Arbitration Disproportionately Affects Women, African-Americans and Texans

Women and African Americans are more likely to be subjected to forced arbitration over workplace disputes than other groups, the Economic Policy Institute reports.That means women and African-Americans have less chance of being able to go to court over issues like unequal pay.

Overall, a majority of private-sector non-union workers have signed into such programs as a condition of employment, EPI reports. Remarkably, more than two-thirds of non-union private-sector employees in Texas - 67.9 percent! - must arbitrate their disputes, EPI's report finds.

Just as remarkably, a much larger percentage of working people who make under $13 an hour - 64.5 percent - face mandatory arbitration than for pay levels above that amount. In other words, the very jobs that fall short of paying a living wage are most likely to require arbitration of disputes over working conditions.

As we have seen in sexual harassment cases, such clauses result in at least two major harms to working people: First, company-paid arbitrators have an inherent conflict of interest and lean in the company's favor; second, whatever happens in arbitration is kept secret, making repeated instances of misbehavior all the more likely. 

The result? Working people who face forced arbitration are less likely to pursue violations of their rights in any forum. The EPI report concludes Congress will need to act if working people are to retain a right to open courts. Without such action, workplace rights might become no more attainable for non-union members than the rights you sign away when you sign up for a credit card.

Of course, labor unions give employees a major say when they negotiate how grievances and discrimination claims will proceed. Some unions may agree to arbitration in some situations, but not without the leverage to make certain the third-party facilitator is chosen fairly and is unbiased:

In a new EPI report, Cornell University professor Alexander J.S. Colvin shows that women and African Americans are more likely to be subject to mandatory arbitration than other workers. More than half of private-sector nonunion workers-or 60 million people-are subject to mandatory arbitration in employment contracts, which takes away their access to the court system for protection of their legal employment rights. 

Colvin estimates that 57.6 percent of female workers (29.3 million) are subject to mandatory arbitration, compared with 53.5 percent of male workers (30.8 million). He also estimates that 59.1 percent of African American workers (7.5 million), 54.3 percent of Hispanic workers (10.0 million), and 55.6 percent of white, non-Hispanic workers (38.9 million) are subject to mandatory arbitration.

Read the Report.