Susan Fowler made huge waves in Silicon Valley when she alleged, earlier this year, that she encountered abuse and sexual misconduct during her employment at Uber; the resulting investigation uncovered 200 employee complaints, and led to nearly two dozen terminations.
So you might think that a lawsuit is all but inevitable. In actuality, though, Fowler, when she joined Uber, signed a contract saying she would handle any such disputes through arbitration, effectively waiving her rights to join a class action suit against the company.
But are such contract provisions actually enforceable? That’s something the Supreme Court will soon weigh in on. Fowler, no doubt, will be paying close attention to these deliberations—as will tech companies and employers nationwide.
The implications of the deliberations are even wider-reaching, though, and could even impact other companies such as Google, which are known to have similar contractual language for their employees.
Here’s what’s happened so far: Fowler’s attorney, Chris Baker, filed a “friend of the court” brief to request the court simply strike down this sort of contractual language. His argument? This attempt by big tech employers to curb collective action is simply in violation of federal law.
Whether the Supreme Court agrees with this or not, the implications could be huge for employers everywhere. Uber will bear the brunt of it, as they have mandatory arbitration clause in their contracts with drivers, who they claim aren’t even employees in the legal sense. Drivers in California have sought legal action against Uber, claiming minimum-wage and overtime law violations—and the Supreme Court hearing on the mandatory-arbitration language could signal whether those other claims have any legal grounds.
And what about Google? The search giant is being sued by three female employees who allege company-wide gender discrimination. They, too, had signed off on contractual language forbidding them from class action.
What this all boils down to is a simple question: Is it legal for employers to ask their employees to waive their rights to sue in court, either individually or collectively?
Based on our experience at Dhillon Law Group, mandatory-arbitration clauses can be very unfair to most employees, and for a variety of reasons: It forces them to keep their dispute private; it limits the documents and testimony they can obtain from their employer and third parties; it curbs their ability for a legal appeal, and the cases are heard before arbitrators who deal repeatedly with big corporations as parties, but are unlikely to see the same plaintiff before them again, creating a perceived bias in favor of repeat players.
Simply put, there is a reason why employers like Uber and Google prefer arbitration—and it’s not because it gives everyone a fair shake. It’s not because it leads to fair and even-handed outcomes. It’s because arbitration is better for them and their bottom line—almost always to the detriment of their employees. And agreements that prevent employees from banding together to pursue common claims in court further protect companies for paying for systemic violations of the law.
Only time will tell how the Supreme Court will rule on this matter, and how vast the reverberations are. Many court-watchers believe the ruling will side with employers—and if so, that will be a significant blow to the rights of individual employees, both in California and nationwide. We must hope for a better outcome, one that upholds everyone’s right to seek legal action in the face of injustice.