Legislature needs to protect workers

Workers in a pork processing plant, 2016. Too often workers who have been wronged by their employer are forced into arbitration, the author writes. Photo courtesy of U.S. General Accountability Office.

When the new class of Minnesota state legislators is sworn in on January 5, 2020, they will almost certainly usher in a new era of progressive leadership in the state. Presumptive general-election victors like Jen McEwen in Duluth and Esther Agbaje in Minneapolis won their primaries on the promise of bringing a more aggressive approach to the State Capitol on issues like housing and the environment.

But when they arrive in Saint Paul, our new legislators — and our veteran elected officials — must commit to another key issue: the fight for workers’ rights.

For decades, Minnesota has enjoyed a reputation as a state that protects workers — a reputation that isn’t hard to maintain when your nearest neighbor is Scott Walker’s Wisconsin. 

Yet in recent years, Minnesota has fallen behind when it comes to fighting for workers. Our state law lacks necessary protections for workers — there is no law requiring that employers offer paid sick leave, and the state’s minimum wage is well below the hourly wage needed to live in any region of the state. 

In the midst of multiple national crises, our elected officials must commit themselves to not just getting Minnesotans back to work, but ensuring that they are safe and empowered on the job.

But passing legislation of the type that Democrats have proposed in the past is not sufficient if Minnesota’s workers do not have the ability to enforce those rights. That means lawmakers must ensure that workers do not sign away their right to their day in court as a prerequisite to entering the workplace.

Under current law, Minnesota’s employers have too little incentive to comply with laws that protect workers, because they know that they are unlikely to get caught. The reason for this complacency is what’s called the “forced arbitration” clause, a contractual provision that  has become prevalent in virtually every aspect of American life. Think of the fine print on your credit card statement — it’s probably preventing you from suing them for wrongdoing. They’ll force you into arbitration instead.

But it’s especially pervasive in employment. 

By 2024, 80% of nonunionized, private-sector workers will be bound by such a clause, researchers estimate. Workers who have signed a forced arbitration clause as a precondition of employment have forgone their ability to take their employer to court. Instead, they are forced into a privatized “justice” system in which there is little oversight, no right to appeal and almost no chance for the worker to win. 

According to findings by the American Association for Justice, “Americans are more likely to be struck by lightning than win in forced arbitration” — meaning employers are almost guaranteed to get away with illegal treatment of their workers. Take the example of wage theft. Wage theft is the most serious form of theft in the country. In 2012, the total value of property taken in robberies of all kind was $340,850,358. That same year, it is estimated that wage theft cost workers over $50 billion. Yet when workers who experience wage theft are forced to arbitrate their claim, 98% of them will abandon it entirely, knowing that their prospects of prevailing are too bleak to pursue. It’s estimated that public agencies have the capacity to recover under 4% of stolen wages. Taken together, this means that employers are able to steal wages with impunity. And that’s just one example — the same basic situation holds true across all manner of illegal employer conduct. 

The scourge of forced arbitration has particular relevance in the era of COVID-19. Even prior to

the crisis, it was impossible for the state to investigate every potential case of employer misconduct in Minnesota. As the pandemic brings a host of new risk for workers, the need for oversight is poised to increase dramatically. Absent a significantly increased budget for state oversight of employers — which, given the current economic forecast and state budget deficit, is highly unlikely — alternative measures must be taken to ensure that employers cannot engage in illegal conduct with impunity.

Should the Legislature fail to act to protect workers from the consequences of forced arbitration, the impacts will continue to fall disproportionately on Black and brown workers. Low-wage workers, women and people of color are the most likely to be bound by forced arbitration clauses. Given the persistence of illegal employer conduct aimed at these very groups — from race-based discrimination in wages to illegal gender-based sexual harassment — the need for workers to be able to enforce their rights is urgent.

Minnesota has rightfully received national attention for its pervasive and systemic racism following the murder of George Floyd. If our state leadership is committed to righting our ugly legacy of racism, that requires ensuring that workers of color in the state have the full protection of the law.

Forced arbitration undermines the legal protections guaranteed to workers and represents a clear obstacle to eliminating discrimination. Enacting legislation to ensure that workers can enforce their rights has to be a top priority in 2021.

Fortunately, other states have shown that it is possible to ensure workers can enforce their rights. In 2004, California passed the Private Attorney Generals’ Act (PAGA), which “allows workers to sue their employers in the name of the state for wage and labor violations.” The law puts money back in the hands of both workers and the state; in 2019, PAGA suits raised $88 million for the state. Other states, including New York, are working to enact similar legislation. And in Colorado, a new law protecting whistleblowers “substantially expand[s] employees’ ability to report workplace violations.”

A new generation of leaders in Minnesota is preparing to make big changes to move our state

forward. The urgency of this work is undeniable. If it wasn’t clear before, this summer has made

terribly apparent that our state’s disparities and history of leaving people behind cannot be ignored any longer. Protecting workers, and ensuring workers can protect themselves, must be at the top of the agenda for progressive legislators in 2021 and beyond.