In the United States, as corporate power is increasing, businesses can work around labor protections with increased ease. One of these labor protection loopholes involves binding arbitration agreements as a condition of employment. These arbitration agreements have the prospective employee waiving their right to a trial and participating in any class action suits against the employer. Disputes between the employee and employer, within the confinements of these agreements, would be settled by a third-party arbitrator who is often biased in favor of the employer.
Potential employees have little choice but to sign these agreements in exchange for employment and even if a candidate refuses to sign, in “at will employment” states, the employer has a right to rescind a job offer. This puts the prospective employee in a difficult situation as they are dealing with the stress of unemployment and finding a means of providing for themselves. Under this duress, even those who are aware of what they are signing may do so despite this knowledge of the potential consequences.
These arbitration agreements are touted as a “win-win” by the employer by offering some benefits to them that employees might find appealing such as the fact that they are resolved faster than jury trials and they are also more cost effective to the employee. These benefits don’t show the whole picture of the implications of these agreements and are used to placate the employees into agreement with them. While these arbitration agreements are an act by employers to put the interests of the business first, they disregard the rights of their workers in such a flagrant manner. This can create an uneasy tension between the employees and the businesses they work for. The working environment that results from this tension is one of distrust and despite the employers looking out for the best interest of the business, this toxic working environment can end up hurting the business in the long run. This was the case for my previous employer who went too far with their arbitration agreements and were found in violation of labor laws as I touched on in a previous contribution.
The use of these arbitration agreements shifts the balance of power into the firm grip of the employer and there is little that the employees can do to remedy abuses by their employer with these agreements in place. This allows these abuses to go unchecked and the employees may tolerate unethical business practices out of fear of losing their job, even in the case of outright discrimination. With the working class pacified and corporate power growing, the avenues that workers can take through the legal system are dissolving into nothing and businesses are growing bolder in trampling on the rights of their employees. The arbitration agreements discussed are just one example of how businesses, with their increased power, engage in practices that are detrimental to working class people and grind to a halt any kind of economic upward mobility.
The most troubling aspect of these abuses is that they are accepted, almost without question, by the American working class. This might be due to the “bootstraps” mentality of America or the almost cult-like devotion a lot of American workers have for their employers. Whatever the cause of this tolerance of these abuses, it is a disturbing trend among the American working class that corporate America may end up capitalizing on.