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Dodd-Frank Bill Provides Robust Whistleblower Protections

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jason zuckermanRecognizing that robust whistleblower protection is critical to preventing another financial crisis, Congress included in the Dodd-Frank financial services reform bill (H.R. 4173) numerous provisions designed to encourage whistleblowing and to provide robust protection from retaliation.  These provisions create monetary awards for whistleblowers who provide original information to the SEC or CFTC, strengthen the whistleblower protection provisions of the Sarbanes-Oxley Act and the False Claims Act, and create additional whistleblower retaliation causes of action.

Reward for Whistleblowing to the SEC and Prohibition Against Retaliation (Section 922). Under Section 922, the SEC will be required to pay a reward to individuals who provide original information to the SEC which results in monetary sanctions exceeding $1 million.  The award will range from 10 to 30 percent of the amount recouped and the amount of the award shall be at the discretion of the SEC.   Factors to be considered in determining the amount of the award include the significance of the information provided by the whistleblower, the degree of assistance provided by the whistleblower, the programmatic interest of the SEC in deterring violations of the securities laws by making awards to whistleblowers, and other factors that the SEC may establish by rule or regulation.  If the amount awarded is less than 10 percent or more than 30 percent of the amount recouped, a whistleblower may appeal the SEC’s determination by filing an appeal in the appropriate federal court of appeals within 30 days of the determination.

Section 922 prohibits the SEC from providing an award to a whistleblower who is convicted of a criminal violation related to the judicial or administrative action for which the whistleblower provided information; who gains the information by auditing financial statements as required under the securities laws; who fails to submit information to the SEC as required by an SEC rule; or who is an employee of the DOJ or an appropriate regulatory agency, an SRO, the PCAOB or a law enforcement organization.

Section 922 creates a new private right of action for employees who have suffered retaliation “because of any lawful act done by the whistleblower– ‘(i) in providing information to the Commission in accordance with [the whistleblower incentive section]; (ii) in initiating, testifying in, or assisting in any investigation or judicial or administrative action of the Commission based upon or related to such information; or (iii) in making disclosures that are required or protected under the Sarbanes-Oxley Act of 2002,’” the Securities Exchange Act of 1934, and “‘any other law, rule, or regulation subject to the jurisdiction of the [SEC].’”  The action may be brought in federal court and remedies include reinstatement, double back pay with interest, as well as litigation costs, expert witness fees, and reasonable attorney’s fees.

New Whistleblower Protection for Financial Services Employees (Section 1057). Section 1057 creates a robust private right of action for employees in the financial services industry who suffer retaliation for disclosing information about fraudulent or unlawful conduct related to the offering or provision of a consumer financial product or service.  The scope of coverage is quite broad in that Section 1057 applies to organizations that extend credit or service or broker loans; provide real estate settlement services or perform property appraisals; provide financial advisory services to consumers relating to proprietary financial products, including credit counseling; or collect, analyze, maintain, or provide consumer report information or other account information in connection with any decision regarding the offering or provision of a consumer financial product or service.

Section 1057 prohibits retaliation against an employee who has engaged in any of the following protected acts:

• Provided, caused to be provided, or is about to provide or cause to be provided, to an employer, the newly created Bureau of Consumer Financial Protection (Bureau), or any other government authority or law enforcement agency, information that the employee reasonably believes relates to any violation of any provision of Title X of the bill, which establishes new consumer financial protections, or any rule, order, standard or prohibition prescribed or enforced by the Bureau;

• Testified or will testify in a proceeding resulting from the administration or enforcement of any provision of Title X;

• Filed, instituted, or caused to be filed or instituted any proceeding under any federal consumer financial law; or

• Objected to, or refused to participate in any activity, practice, or assigned task that the employee reasonably believes to be a violation of any law, rule, standard, or prohibition subject to the jurisdiction of, or enforceable, by the Bureau.

Remedies include reinstatement, backpay, compensatory damages, and attorney’s fees and litigation costs, including expert witness fees.  Where reinstatement is unavailable or impractical, front pay may be awarded.

Section 1057 employs a burden-shifting framework that is favorable to employees.  A complainant can prevail merely by showing by a preponderance of the evidence that her protected activity was a contributing factor in the unfavorable action. A contributing factor is any factor which, alone or in connection with other factors, tends to affect in any way the outcome of the decision.  Once a complainant meets her burden by a preponderance of the evidence, the employer can avoid liability only if it proves by clear and convincing evidence that it would have taken the same action in the absence of the employee’s protected conduct.

The procedures governing Section 1057 claims are substantially similar to those governing retaliation claims brought under the Consumer Product Safety Improvement Act of 2008, 15 U.S.C. § 2087.  The statute of limitations is 180 days and the claim must be filed initially with the Occupational Safety Health Administration (OSHA), which will investigate the complaint and can order preliminary reinstatement.  Once OSHA issues its findings, either party can request a hearing before a Department of Labor (DOL) administrative law judge.  If the DOL has not issued a final order within 210 days of the filing of the complaint, the complainant has the option to remove the claim to federal court and either party can request a trial by jury.  Section 1057 claims are exempt from mandatory arbitration agreements.

Reward for Whistleblowing to the CFTC (Section 748). Section 748 amends the Commodity Exchange Act, 7 U.S.C. § 1 et seq., to create a whistleblower incentive program and whistleblower protections similar to those in section 922, including a new private right of action.  One notable difference between sections 748 and 922 is the ability of a commodity whistleblower to appeal any determination regarding an award made by the Commodity Futures Trading Commission (CFTC) within 30 days.  Protected conduct under section 748 includes providing information to the CFTC in accordance with the whistleblower incentive provision and “assisting in any investigation or judicial or administrative action of the [CFTC] based upon or related to such information.”

Strengthening Sarbanes-Oxley’s Whistleblower Protection Provision (Sections 922 and 922A). Sections 922 and 929A contain important amendments to the Sarbanes-Oxley act (SOX) that broaden the scope of coverage, increase the statute of limitations, exempt SOX whistleblower claims from mandatory arbitration, and clarify that SOX claims removed to federal court can be tried before a jury.

Section 929A clarifies that the whistleblower protection provision of the Sarbanes-Oxley Act (SOX), 18 U.S.C. § 1514A, applies to employees of subsidiaries of publicly-traded companies “whose financial information is included in the consolidated financial statements of [a publicly] traded company.”  This amendment eliminates a significant loophole that some courts have read into SOX that has substantially narrowed the scope of SOX coverage.  Elevating form over substance, some judges have permitted publicly-traded companies to avoid liability under SOX merely because the parent company that files reports with the SEC has few, if any, direct employees, and instead employs most of its workforce through non-publicly traded subsidiaries.

As Judge Levin pointed in Morefield v. Exelon Servs., Inc., ALJ No. 2004-SOX-002 (ALJ Jan. 28, 2004), this loophole is contrary to the purpose of SOX in that “[a] publicly traded corporation is, for Sarbanes-Oxley purposes, the sum of its constituent units; and Congress insisted upon accuracy and integrity in financial reporting at all levels of the corporate structure, including the non-publicly traded subsidiaries . . . [Congress] imposed reforms upon the publicly traded company, and through it, to its entire corporate organization.”  Section 922(b) further expands the coverage of section 806 of SOX to include employees of nationally recognized statistical ratings organizations (NRSROs), including A.M. Best Company, Inc., Moody’s Investors Service, Inc., and Standard & Poor’s Ratings Service.

Section 922(c) increases the statute of limitations for SOX whistleblower claims from 90 to 180 days and clarifies that SOX retaliation plaintiffs can elect to try their cases in federal court before a jury.  In addition, section 922(c) declares void any “agreement, policy form, or condition of employment, including a predispute arbitration agreement” which waives the rights and remedies afforded to SOX whistleblowers.

Strengthening the False Claims Act’s Whistleblower Protection Provision (Section 1079B). Section 1079B amends the anti-retaliation provision of the False Claims Act, 31 U.S.C. § 3730(h), by expanding the definition of protected conduct to include “lawful acts done by the employee, contractor, or agent or associated others in furtherance of an action under this section or other efforts to stop 1 or more violations of [the False Claims Act],” thereby protecting against associational discrimination and covering a broad range of activities that could further a potential qui tam action or could stop a violation of the FCA.  Section 1079B clarifies that the statute of limitations for actions brought under section 3730(h) is three years, which brings much-needed clarity in the wake of the Supreme Court’s decision in Graham County Soil & Water Conservation Dist. v. U.S. ex rel. Wilson, 545 U.S. 409 (2005) holding that the most closely analogous state statute of limitations applies to FCA retaliation claims.

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Hooray for Albany? Legislature Acts to Boost Working People and the Economy

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amytraub4Griping about Albany is always in style: pundits denounce late budgets, lax ethics rules, and special interest shenanigans. And they’ve got a point. But in the end-of-session frenzy, state legislators are also taking far more positive action: raising workplace standards for some of the state’s most exploited workers, many of whom (no surprise) live and work in New York City. By lifting pay and strengthening protections for low-wage workers, the new legislation will also promote economic recovery.

The Domestic Workers Bill of Rights gets the most ink, and for good reason: once it’s signed by the governor, this landmark law will be the first in the nation to set basic labor standards for household employees like nannies, caregivers and housekeepers. As I noted in an earlier post about the measure, the bill

guarantees basic workplace protections like overtime pay, the chance to take at least a day off every week, coverage under employment discrimination laws, advance notice if a domestic employee is about to be fired, and minimal paid sick time and vacation. It would apply to 200,000 domestic workers in New York currently subject to the whims of their employers when it comes to these fundamental rights.

But a law doesn’t need to be the first in the nation to be effective at protecting New Yorkers on the job. The Wage Theft Prevention Act, passed in slightly different versions by the State Senate and Assembly and awaiting reconciliation, follows the footsteps of successful legislation in Miami-Dade County and in states from Washington to Wisconsin. The bill strengthens incentives for employers to comply with the wage and hour regulations already on the books by stiffening penalties for cheating employees out of wages, encouraging workers to come forward, and providing new avenues for investigating and prosecuting wage theft cases – and ensuring violators will pay up. The need for this legislation is vividly highlighted by research revealing that in New York City alone, an estimated 586,000 low-wage workers a year see a portion of their pay stolen by employers, losing an aggregate $18.4 million every week as a result.

Finally, Albany is acting to make good on the promise that the state government shouldn’t undermine the pay of private sector employees. By clarifying standards that require service workers employed at public agencies to be paid the prevailing wage for their job category, janitorial staff and security guards at massive utilities like Con Edison will see their wages and benefits rise to match the standard paid to other local workers in their industries. The bill awaits the governor’s signature.

Together, these three bills will increase workplace protections for nearly 800,000 working New Yorkers, adding to the security of their families. And while the legislation includes critical safeguards on issues like employment discrimination and adequate time off, the bills also provide an increase in pay for some the lowest paid workers in New York. By putting money in the pockets of working people, they will boost local businesses and contribute to the state’s economic recovery.

While critics carp that the bills will be “burdensome” to business and could harm job creation as a result, the facts are against them. Business is on its way to recovery: corporate profits jumped 44% in the first quarter of 2010 compared to a year earlier. Yet growing profits have not prompted a comparable increase in hiring. Small businesses, meanwhile, continue to report that the biggest factor harming their profitability is weak sales and a lack of customers. Putting more money into the hands of people who will spend it, as these bills do, will encourage the consumer demand that spurs companies to hire.

Columnist Errol Louis at the Daily News notes that the state legislature “racked up a number of solid achievements that will increase opportunity and fairness for working people.” He’s right. And all of New York stands to benefit. Governor Paterson should sign the three pro-worker, pro-economy bills as soon as they hit his desk.

About the Author: Amy Traub is the Director of Research at the Drum Major Institute. A native of the Cleveland area, Amy is a Phi Beta Kappa graduate of the University of Chicago. She received a graduate fellowship to study political science at Columbia University, where she earned her Masters degree in 2001 and completed coursework towards a Ph.D. Funded by a field research grant from the Tinker Foundation, Amy conducted original research in Mexico City, exploring the development of the Mexican student movement. Before coming to the Drum Major Institute, Amy headed the research department of a major New York City labor union, where her efforts contributed to the resolution of strikes and successful union organizing campaigns by hundreds of working New Yorkers.

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House Hearing Focuses on Mine, Workplace Safety

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Image: Mike HallYesterday afternoon, Mine Workers (UMWA) President Cecil Roberts told the House Education and Labor Committee, “We can and must do a better job of protecting our nation’s miners,” and urged Congress to approve legislation to strengthen mine and workplace safety laws.

The bill, the Miner Safety and Health Act (H.R. 5663),  focuses on mine safety, but also includes provisions to strengthen worker safety protections in all workplaces. Its backers say recent deadly workplace disasters are concrete but tragic evidence that job safety laws must be improved.

Just this year, the deadly Massey Energy Upper Big Branch explosion  killed 29 coal miners; the Tesoro refinery blast claimed the lives of seven Washington State workers; the BP oil rig blast killed 11,  and six workers died at  a Connecticut Kleen Energy Systems explosion.

As Roberts told the committee: “Clearly the status quo isn’t good enough.”

The Mine Safety and Health Administration’s (MSHA) efforts have failed to motivate at least some mine operators, like Massey, to operate their mines safely each and every day.

Stanley “Goose” Stewart was able to escape the April 5 blast at Upper Big Branch. He outlined more than a dozen safety shortcuts and violations, from ventilation to coal dust and methane levels, conducted and condoned by mine management he witnessed at Upper Big Branch. The 34-year-veteran miner, who spent 15 years at Performance Coal Co., the Massey subsidiary operating Upper Big Branch, told the committee:

Something needs to be done to stop outlaw coal companies who blatantly disregard the laws…This bill must pass to keep coal companies honest or make them pay the price for their unscrupulous behavior. Partisanship must be set aside on the legislation because human lives are at stake.

MSHA chief Joe Main, told the committee that the bill “will change the culture of safety in the mining industry…and put the health and safety of miners first.”

It does not simply fix a particular hazard or practice that caused the last disaster, as has often been the pattern in mine safety reform. Instead, it gives MSHA the tools it needs either to make mine operators live up to their legal and moral responsibility to provide a safe and healthful workplace for all miners, or to step in with effective enforcement when operators refuse to live up to this responsibility and endanger miners.

AFL-CIO General Counsel Lynn Rhinehart told the committee that the improvements to the Occupational Safety and Health Act (OSH Act) in the bill are long overdue and “urgently needed.”

Pointing to the most recent deadly workplace disasters, Rhinehart said that since the OSH Act was passed 40 years ago,

the law has never been significantly updated or strengthened, and as a result, the law is woefully out of date.  The OSH Act’s penalties are weak compared to other laws, the government’s enforcement tools are limited, and protections for workers who raise job safety concerns are inadequate and far weaker than the anti-retaliation provisions of numerous other laws.  The law simply does not provide a sufficient deterrent against employers who would cut corners on safety and put workers in harm’s way.

On the mining side, the bill would crack down on serial safety violators of mine safety rules by revamping the criteria for placing a mine in what is called “pattern of violation” (POV) status that launches tougher enforcement and stronger penalties.

Mine operators have been able to game the POV rules so successfully that not a single mine has been placed in the POV status since 1977. Main called the changes in the POV system the “most important new tools” in the bill.

The Upper Big Branch mine had been repeatedly cited for ventilation and dust buildup problems before the blast. But many of those violations were under appeal, a tactic mine operators use to delay greater scrutiny. Said committee chairman, Rep. George Miller (D-Calif.) :

The Upper Big Branch mine is the perfect example of how current law is inadequate, especially for those operations that do everything to flout the law.

The bill also would guarantee miners the right to refuse to work in unsafe conditions, a right that is written into every Mine Workers (UMWA) contract. Nonunion miners have long said they fear employer retaliation if they speak out about mine safety problems.

It also would strengthen whistleblower protections for workers who speak out about unsafe conditions or who testify in safety investigations.

Under the bill, MSHA would have stronger enforcement tools, including the authority to subpoena documents and testimony and seek court orders to close a mine when there is a continuing threat to the health and safety of miners. It also increases civil and criminal penalties for mine owners who violate safety laws.

For other workplaces covered by OSHA, the bill would strengthen whistleblower protections, increase criminal and civil penalties and speed up hazard abatement. In addition, victims of accidents and their family members would be provided greater rights during investigations and enforcement actions.

Rhinehart told the committee that in the 2009, the median initial total penalty for violations related to a fatality  penalty was:

a paltry $6,750, with the median penalty after settlement just $5,000. Many of these are fatalities caused by well-recognized hazards:  trench cave-ins, failure to lock-out dangerous equipment, and lack of machine guarding.

These are not meaningful penalties—they are a slap on the wrist.  Penalties of this sort are clearly not sufficient to change employer behavior, improve workplace conditions, or deter future violations.

The provisions strengthening the OSH Act were taken from the Protecting America’s Workers Act (H.R. 2067), which was introduced earlier this year and has already been the subject of House and Senate hearings. Rhinehart urged Congress to act on the other provisions in the bill, including:

extending OSHA coverage to millions of state and local public employees who are not (and have never been) covered by the law, and enhancing worker and union rights in the enforcement process.

For a look at the group opposed to strengthening mine and workplace safety laws—the Coalition for Workplace Safety—take a look at Celeste Monforton’s post today on the Pump Handle blog. She blows the cover off the pro-safety sounding from corporate front group, finding it’s another well-funded attempt by the National Association of Manufacturers, the US Chamber of Commerce, and more than 20 other industry groups to oppose fundamental improvements to the 40-year-old OSHA law.

This article was originally published on AFL-CIO NOW Blog.

About The Author: Mike Hall is a former West Virginia newspaper reporter, staff writer for the United Mine Workers Journal and managing editor of the Seafarers Log. He came to the AFL- CIO in 1989 and have written for several federation publications, focusing on legislation and politics, especially grassroots mobilization and workplace safety.

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Deficit Craze Stiffs Jobless Again — 3 Million Could Lose Benefits in July

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Image: Art LevineDeficit-mania has struck Washington again, with most Democrats and the Obama administration essentially accepting the propaganda of deficit hawks while also calling for extending unemployment insurance benefits. The result? The Senate failed again to pass a relatively bare-bones “stand-alone” benefits extension bill that doesn’t even include a COBRA extension, or aid to the states to pay for their swelling Medicaid rolls. Another modest $10 billion bill to help localities keep teachers on the job is also floundering, even though it’s paid for with spending cuts and legislative savings elsewhere in funding bills .

Any meaningful direct job-creation programs for the nearly 15 million Americans who are officially unemployed are also dead for now — despite a damning new report co-authored by the National Employment Law Project showing that it will take years to make up the jobs already lost. As even moderate pundit Eleanor Clift observed, after viewing a liberal panel calling for massive infrastructure programs to boost the economy, “The actual [unemployment] number, far higher than what the weekly stats tell us, is on the way to becoming a permanent feature of the new economy. And while governments scrambled to save banks, there’s no comparable urgency about creating jobs.”

After the vote, Senator Majority Leader Harry Reid vowed to try again when a new Senator from West Virginia is seated in the wake of the death of Democratic Senator Robert Byrd. Even the more Democratic-leaning House of Representatives (!) rejected earlier this week a stand-alone extension on Tuesday, too, although it passed a scaled-down one Thursday. But a new vote vote probably won’t take place until after the July 4th recess when Congress comes back into session on July 12th. If the procedure drags on through July, as a new report co-authored by the National Employment Law Project and Center for American Progress shows, the government estimates that over three million people could lose their benefits.

UPDATE: The House passed a short-term extension Thursday, but it’s too late to make a difference for those who will lose benefits before the full Congress resumes in July.

The key vote on the measure fell one short needed to overcome a GOP filibuster. Senator Reid declared (hat tip to The Washington Independent): “It is beyond disappointing that Republicans continue to stand almost lockstep against assistance for out-of-work Americans — especially since many of these same Republicans spent months protecting Wall Street and preserving tax cuts for CEOs who ship American jobs overseas.”

Politico highlights the political dynamics at work — and they don’t favor progressives or unions:

The death of Sen. Robert Byrd (D-W.Va.) this week and defection of Sen. Ben Nelson (D–Neb.), a fiscal conservative from a low-unemployment state, helped to seal the fate. But more than any other one issue, the impasse over jobless benefits has come to dramatize the Republicans’ almost single-minded focus on deficit reduction as an economic–and campaign–theme this election year.Just two Republicans, Maine Sens. Olympia Snowe and Susan Collins, joined in support of an estimated $34 billion bill to extend benefits through November. Early hopes of getting help from Sen. Scott Brown were dashed Wednesday when the Massachusetts Republican went to the Senate floor with his own alternative — heavily reliant on cutting unspent funds from last year’s giant recovery act.

Yet as the Campaign for America’s Future Dave Johnson points out:

The real deficit is jobs. That is one more of those things that everyone can see in front of their faces, but we’re told it isn’t what it is. There aren’t enough jobs, and we’re being told this is our fault because we wanted pensions and good wages and vacations and respect and dignity and please, sir, just a little slice of the pie.In case you haven’t noticed, the world’s economy is suddenly undergoing a classic “Shock Doctrine”-style, coordinated propaganda attack. The wealthy and powerful, having insisted that countries cut their taxes and run up debt, now insist that the middle class and poor must work harder, have their pensions reduced, sell off (to them) their publicly-held resources, and take other “austerity” steps to pay off the debt that these lazy, parasitic peasants dared to run up.

It was especially ironic that on the same day that the Senate bowed to the deficit-uber-alles crowd in Washington, AFL-CIO president Richard Trumka was trying to make the case to the President’s deficit commission — whose appointment reflects Wall Street’s conventional wisdom on deficit-cutting — on why expanding jobs and helping the jobless is good for the economy. As the AFL-CIO Now blog reported:

“We must have a job-centered approach to stabilizing the national debt, which would bring us closer to our goal of sustainable, broadly shared prosperity.”To a great extent, the size of the deficit depends on employment and growth. When employment and growth are weak, tax revenues are low and social assistance expenditures are high. When employment and growth are strong, the reverse is true.

He also warned the panel that ending stimulus spending that creates jobs and growth–as many Republican lawmakers are promoting–could send the U.S. and global economy into a double-dip recession, or worse. The Economic Recovery Act, said Trumka:

“did exactly what it was supposed to do. It increased the number of people employed by up to 2.8 million, increased the number of full-time jobs by up to 4.1 million and increased real GDP by up to 4.2 percent in the first quarter of 2010. But it wasn’t big enough.”

The harshest words for the deficit commission — whose ideology is helping fuel the Congressional rejection of jobs creation and unemployment benefits — was left for economist James Galbraith. As Firedoglake reports on his attack on the “cat food commission” (via the Roosevelt Institute):

For a quick snapshot, Galbraith’s testimony is divided into ten sections, which address the following points:-That the Commission’s work is illegitimate

-That current deficits and rising debt were caused by the financial crisis.

-That future deficit projections are generally based on forecasts which begin by unrealistically assuming full recovery

-That, having cured the deficits with an unrealistic forecast, CBO recreates them with another, very different, but equally unrealistic forecast.

-That the only way to reduce public deficits is to restore private credit.

-That Social Security and Medicare “solvency” is not part of the Commission’s Mandate.

-That as a transfer program, Social Security is also irrelevant to deficit economics.

-That markets are not calling for deficit reduction, either now or later.

-That in reality, the US government spends first & borrows later; public spending creates a demand for Treasuries in the private sector.

-That the best place in history (for this Commission) would be no place at all.

Galbraith’s conclusion: “”You are plainly not equipped, either by disposition or resources, to take on the true cause of deficits now or in the future: the financial crisis.”

Neither is Congress, which seeks instead to protect the tax breaks of hedge fund managers while denying unemployment benefits to the jobless and allowing nearly 30 million people to remain unemployed or under-employed.

This article originally appeared in Working In These Times Blog.

About The Author: Art Levine , a contributing editor of The Washington Monthly, has written for Mother Jones, The American Prospect, The New Republic, The Atlantic,, and numerous other publications. He can be reached at

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The King Has No Clothes, Lebron’s Lessons For Work

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Image: Bob RosnerThe Lebron-a-thon reminded me of an old Vietnam era joke. One soldier turns to another and asks, “What’s the difference between the Marines and the Boy Scouts?” The second soldier shakes his head saying he doesn’t know. The first smiles and says, “The Boy Scouts have adult leadership.”

The Lebron-a-polooza proved one thing, a group of twenty-somethings can win the battle and lose the war.

If during his special on ESPN Lebron had announced that he was sticking with his hometown Cleveland, he would have turned from a local hero to a national hero. Sure, Miami, Chicago, NY, LA and Brooklyn/NJ would have been disappointed, but the rest of the country would have rallied around him.

I’m not saying that he had to stay in Cleveland. I am saying that as soon as Lebron realized that leaving Cleveland was a possibility, the ESPN Lebron-cast should have been dropped.

As a nation we can only handle so many bad breakups. I’m still smarting over America’s sweetheart, Sandra Bullock, getting jilted. Then Tipper Gore. Now Cleveland? That’s just too much for a nation to bear.

So what is the business lesson here? The importance of adult leadership.

Young people can have talent, money and endless opportunities. But there is a point where wisdom can leverage all of that more than the buddies that you went to school with. I’ve seen Entourage. For every time that your posse points you in the correct direction, there are many more times where you make a glaring mistake.

Heck, I’m 53 years old, and these days I tend to reach out to wiser souls when I have a big decision to make. And I can’t tell you how much it has helped me.

Lebron, do the show and stay. Or leave town quietly.

I didn’t even watch the show and I had to take a shower after I found out what happened. It just felt dirty.

The only thing that made Lebron look good was the very public rant of the owner of the Cavaliers. Dumb. But unfortunately Lebron’s fingerprints are here too. Because after seven years it he should have contacted the owner to let him know before he went on national TV.

Twitter and ESPN work for the masses. But for your partner for seven years, you owe it to come from you directly. Privately.

Sure the Madonna rule could apply to Lebron. You know, there is no such thing as bad publicity. But personally I feel that his brand went from the penthouse to the outhouse, because of his own decision making.

Lebron, try adult leadership. I think you’ll like it.

About The Author: Bob Rosner is a best-selling author and award-winning journalist. For free job and work advice, check out the award-winning Check the revised edition of his Wall Street Journal best seller, “The Boss’s Survival Guide.” If you have a question for Bob, contact him via

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Domestic Workers in New York Win First-Ever Job Protections

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Troublemakers logo-blueDomestic workers in New York have won historic changes to the state’s labor law to include protections for their jobs. Final votes on Thursday ended weeks of wrangling between state Assembly and Senate leaders and Governor David Paterson, who said he would sign the bill.

The law guarantees domestic workers time-and-half pay for more than 40 hours and a day off each week, along with protection under worker compensation and anti-discrimination law and access to unemployment insurance. The compromise bill won’t include original demands for paid sick and vacation days and advance notice of termination. But three paid days off were granted after a year of service.

Domestic workers and advocates have been holding their breath since June 1, when 100 domestic workers and allies from around New York City traveled a well-worn path to Albany for a vote on the Domestic Workers Bill of Rights. The housekeepers and caregivers who tend to the children and homes of New York’s well-to-do had made this trip countless times in the last six years, coming face to face with lawmakers to campaign for basic protections on the job.

Promised votes that never materialized had disappointed them many times before. But on that night, after hours of worker testimonies and a few stories from state senators about the domestic work their mothers and grandmothers did, the Senate—at long last—voted 33 to 28 in favor of the bill.

“It was an incredible moment of validation,” said Priscilla Gonzalez, director of Domestic Workers United, the organization behind the bill. “We started six years ago by walking into legislators’ offices and educating them. Now we found ourselves witnessing senator after senator thanking these immigrant women of color who had been invisible for so long.”


The legislative victory in New York is a historic blow at domestic workers’ exclusion from federal labor protections. The legislation would be the first in the country to provide protections to domestic workers since the National Labor Relations Act of 1935 first excluded them.

The biggest stumbling block appeared to be outgoing Governor Paterson. While he reaffirmed the pledge of support he made for the bill on a radio show last year—acknowledging the historical exclusion of domestic and farm workers from labor law protections as racist—he approached the bill cautiously, at first issuing a statement denying he supported it. After the Senate and Assembly approved the compromise version Thursday, with three Republicans joining all 32 Democrats in the Senate, Paterson announced he would sign the bill.

The law also calls on the state’s Department of Labor to study the feasibility of collective bargaining for domestic workers and issue a report by November.

Domestic Workers United has much to celebrate in coming this far. DWU, founded in 2000, estimates that at least 200,000 people in the state—mostly immigrant women from Africa, the Caribbean, and Latin America—work in other people’s homes as housekeepers and live-in caregivers.

While some caregivers report decent working conditions with warm families and children they adore, others have to live with over-demanding bosses, and organizers have heard (and experienced) every horror story imaginable, from sexual assault to sewage-filled basement living conditions, abuse both physical and emotional—a litany of violations against basic human decency.

Even the not-so-bad situations can take a turn. Domestic workers report not being compensated for long trips, having to work while sick, and being let go without notice.

“A lot of times when you’re sick and can’t get up and go to work, you still get up and try to go, because you know you won’t get paid or they will replace you,” said Merilyn Blackett, an immigrant from Trinidad and Tobago with six years at DWU and nine years as a care provider for the elderly.

Arranging her own medical care has been difficult, too. Unable to get appointments during off hours, Blackett said she’d have to decide between getting paid or seeing her doctor.

Blackett and other determined workers met in 2004 to spell out what they wanted to see changed at work, giving birth to what would become the Bill of Rights.


Domestic workers planned daily events in front of the governor’s office the week of June 14 to insist he sign the bill. Organizers burned through call lists and invited out prominent friends like the feminist leader Gloria Steinem, friendly legislators, labor leaders, and other allies gained during a decade of organizing.

Gonzalez said she expected legislators to prepare a compromise between the two bills, but argued for the strongest possible provisions. “Sick days and holidays are things that domestic workers on their own would not be able to negotiate—the power balance with the employer is too great,” she said. “We’re not asking for anything more than anyone else gets—we’re asking to get onto equal footing with other workers.”

Not everyone’s in support. Comments on news articles online show that for some employers, the bill hits a raw nerve. Gonzalez said some lawmakers fear the precedent this bill would set for domestic workers in other states and other groups of excluded workers—like farm workers.

DWU offers them no illusions: with their allies, they intend to run with the precedent as far and fast as they can.


DWU’s work is being replicated in other states through the National Domestic Workers Alliance, an organization of worker centers, immigrant rights groups, and domestic worker cooperatives that grew up out of the 2007 U.S. Social Forum in Atlanta.

Blackett said when she first got involved in DWU, after a friend encouraged her to attend a monthly meeting, “we were just thinking about mobilizing the domestic workers in New York City.” After DWU members went to Atlanta, she realized there were many other domestic workers they could help if they prevailed at home.

Domestic workers and their allies in California and Colorado are drafting their own bills of rights to introduce in their state legislatures. Organizations from the Bay to LA are collaborating to introduce a bill next year. They’ve produced a detailed survey of conditions, won the support of the San Francisco City Council, and gained a hearing on domestic worker conditions with the state legislature’s labor committee.

At the U.S. Social Forum in Detroit in June, the national alliance and a host of organizations planned a multi-year campaign to change federal labor law to cover all domestic and farm workers.

Originally published on Labor Notes.

About The Author: Tiffany Ten Eyck, a Michigan native, has worked with the Student/Farmworker Alliance and the successful Taco Bell Boycott campaign. A former SEIU intern, USAS activist, and anti-war agitator; she covers the UAW, farm workers, workers centers,  and building trades for Labor Notes.

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The ‘Blame the Teacher’ Movement, and the Public-Sector Union Crisis

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Richard GreenwaldWill government workers join the race to the bottom?

I was stopped dead in my tracks and felt a cold chill run down my spine while reading the current issue of The Atlantic. Its cover story is “The 14 3/4 Most Powerful Ideas of the Year,” which is a Top 10 list that makes fun of Top 10 lists (hence the 3/4).

Idea number 13 is the one that got me. It was written by The New York Times’ David Brooks and titled “Teachers are Fair Game.” As Brooks sees it, it is now open season for intellectually assaulting teachers. To be honest, Brooks aims mostly for the teachers unions. The result is yet one more mainstream media outlet joining the echo chamber claiming that teachers and their organizations are at fault for the poor state of education in America.

What I call the “blame the teacher” movement is smart politics for those on the right. It shifts public debate away from funding and economic equity issues to teachers on the frontline. In some ways it is like a Fordist speedup without the $5 day. Newly proposed policy would tie teacher salaries, merit pay, and even tenure to student test scores. The pressure is up, but, with diminished funding, resources are down.

Now, improving education is something everyone favors. It’s like democracy. But how one gets there is the million-dollar question. Can you improve education by putting increased pressure on teachers to raise classroom test scores in a time of declining public funding for education? We are about to see.

In my last Working ITT blog post, I bemoaned how we seem to hate “career” teachers as a culture. We love the young, idealistic missionary teachers. And we should: These recent college graduates are energized, smart and dedicated. But they have a short shelve-life, lasting a short time in the classroom before they are off to other careers. One could argue that even this is good, as the experience of a 2-3 years in a classroom changes them for the better.

Frankly, most teachers, it must be said, last only a short time in the classroom. The challenges are so great, the emotional costs as well as the salaries force many to rethink their career choices. Those that stay in education (I mean in the classroom) do not typically do so because they’re losers, or can’t find better jobs. They stay with it because they care and believe they can make a difference despite the hardships. It is precisely these teachers who have the nation’s eyes focused on them. I can almost hear the collective buzz in their ears from all this talk about them.

This public attention on teachers is part of a bigger public shift. There seems to be a major reset (to use a phrase from geographer Richard Florida) in the way we see public servants. It used to be that those that worked in public service were seen as civic. They worked hard, were valued and seemed to deserve their salaries and benefits. Up until the 1970s, public-sector salaries lagged far behind private-sector salaries. So state workers were working for less than market value.

But as private salaries for blue-collar and clerical jobs dropped and state salaries remained relatively stable, public-sector jobs looked better. Now, there is an attempt to downsize state payrolls, and get rid public servants. But rather than defending their service, we now see public servants as having it easy. They simply had what most American had, and lost.

What’s stopping many governors from this slash and burn are public-sector unions. So we need to see the current push against teachers as part of a larger push against public-sector unions. Rather than let each union deal with this shift, the labor movement should see the attack for what is, and coordinate a campaign to reverse this cultural shift.

Returning to David Brooks and teachers, we learn

…that a new cadre of reformers have come on the scene, many of them bred within the ranks of Teach for America. These are stubborn, data-driven types with a low tolerance for bullshit. The reform environment they find themselves in is both softhearted and hardheaded. They put big emphasis on the teaching relationship, but are absolutely Patton-esque when it comes to dismantling anything that interferes with that relationship. This includes union rules.…

Put simply, teachers unions stand between teachers and the public for better or for worse. Brooks points out some of the worse, but what of the better?

I’m a historian, so it’s important that I place this issue within its larger historical frame. Teachers unions have only been around for a little more than 100 years. They developed in large urban systems, such as New York City and Chicago. These systems were totally dysfunctional, patronage machines rife with politics. Professional educators joined together to advance professionalism over politics and patronage and to protect academic freedom.

These organizations were not like the trade unions of the day. They were much more professional societies, part of a period drive toward professionalization that historian Rober Weibe called “The Search for Order.” One hundred years ago teachers could be fired for all sorts of reasons, few related to the quality of teaching. Female teachers could be fired if they married, for instance.

Teachers were respected culturally, but it was not a profession. These early reformers demanded higher and better training for teachers as well as licensing. They cared about their students and fought to find ways to help them. But they also wanted decent wages and better working conditions and as professionals, they demanded some limited shared governance, or control over the educational mission (their classrooms). They did not see these aims as being in conflict. This professional focus has led to a more conservative style of unionism for teachers that the public and the right seems to have forgotten. They never felt fully comfortable as workers and their unions often walked that fine line between professional association and labor union.

Jump forward to the 1980s, when these unions were firmly established. As budgets were slashed and a call for accountability began to be heard, it was the teachers unions who mounted a campaign to retore public support for school funding and who also joined the reform efforts. Now, yes funding for schools helps their members. But, it is not just salaries. Stronger school budgets mean better support, newer books, smaller class sizes etc.

But teachers unions are now in a tough place. They seem to have lost their ability to claim they speak for “education” as they had in the 1980s. And if they can’t speak for public education, who can?

Today unions are at a crossroads. The majority of union members are public-sector workers. And these are precisely the same workers on the chopping block today. Unions need to find a better way to protect these workers than simply hiding behind the contract. The contract will protect workers in the short run, but in winning the battle they will lose the war.

We are losing an important aspect that informed public policy since at least the age of Herbert Hoover: The public should be held to higher standards than the private sector. My grandfather always told me it was a sad day when New Yorkers had to to pay to take public transportation. I remember him telling me if you pay, it ain’t public.

He was smart enough to know that his taxes paid for the fare. But he also understood that while income taxes were progressive, subway fare weren’t. He also knew that eventually the fares would just keep rising. He died some years ago, but I think he was right. What we need is a better sense of the public. If there are fewer good-paying jobs left, we all suffer.

Put simply: If federal, state and local government workers join the race to the bottom, we may well be doomed.

About The Author: Richard Greenwald is a labor historian and social critic. He is currently a professor of history at Drew University. His essays have appeared in In These Times, The Progressive, and The Wall Street Journal among others. He is currently writing a book on the rise of freelancing and is co-editing a book on the future of work for The New Press, which features essays from the county’s leading labor scholars and public intellectuals.

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Living Wage Law Would Create Benefits for Business, City’s Economy

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John PetroIn response to the hottest legislative issue in City Hall right now, the Daily News ran two opinion pieces on a bill that would guarantee living wages to all workers at city-subsidized development projects. This would mean that if a developer receives city tax breaks or other assistance to build a mall, for example, the retail workers, janitors, parking attendants, and any other employee at that mall would be paid at least $10 an hour with health benefits, or $11.50 an hour without benefits.

The principle behind the bill is simple: the city should only use taxpayer dollars to create high-quality jobs. Subsidizing the creation of poverty-level jobs makes little economic or fiscal sense. After all, it already costs the state at least $5.2 billion to provide services and assistance to the working poor. Why should we use scarce tax dollars to subsidize development that will only add to these public costs?

In a piece filled with false assumptions and unsupported claims, Diana Furchtgott-Roth argues that guaranteeing the creation of good jobs will actually hurt the city’s economy and its taxpayers. Not only is the living wage in Furchtgott-Roth’s crosshairs, but also the prevailing wage and even the minimum wage. In other words, Furchtgott-Roth rejects the idea that government should regulate the labor market.

Clearly there are good reasons for government to do exactly that, not just in the name of altruism but for the sake of the taxpayer, the business climate, and the city’s overall economy. In 1960, speaking to members of Congress, President John F. Kennedy noted that, “The increases in purchasing power resulting from a higher minimum wage will help to restore consumer demand required to put our idle industrial capacity back to work.”

Even in China, which built its economy on low-cost labor, cities are passing new laws that boost worker wages in order to increase the purchasing power of Chinese households and to create domestic demand for Chinese goods and services.

But the discussion about wages and business in New York City has become so backward that the real and demonstrable benefits of boosting wages for the city’s economy has become lost in a sea of misinformation.

Take Furchtgott-Roth’s piece. The living wage bill will, according to the author: stall development, cause businesses to flee the city, waste taxpayer money, and increase unemployment. Notably absent was any evidence to support these claims.

In reality, living wage laws have not had any significant negative impact on businesses in the over 120 cities that have passed these laws. In Santa Fe, New Mexico every single worker within city borders is guaranteed by city law to be paid a living wage. This is, by far, a much more ambitious bill than what is currently under consideration in New York City, where only workers at subsidized buildings will be covered. And yet, a study by the University of New Mexico Bureau of Business and Economic Research has shown that since Santa Fe passed its living wage law there has been no demonstrable negative effects on employment or firm growth. Studies of other cities with living wage laws have demonstrated similar results.

Despite the evidence the living wage bill in New York City is strongly opposed by Mayor Bloomberg and real estate interests. This is because the bill challenges the current economic development status quo. Instead of promoting the types of projects that create the most wealth for a select group of developers, the bill would ensure that working New Yorkers benefit directly from the city’s economic development efforts

About The Author: John Petro is an urban policy analyst at the Drum Major Institute for Public Policy. He runs the Progressive Urban Model Policies (PUMP) Project, a first-of-its-kind initiative to organize and share best practices in policy design and implementation. His writing on urban issues has appeared in the San Francisco Chronicle and his recent research has been covered in Politico, The New York Times, Reuters, and other media outlets.

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Extreme Customer Service

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Image: Bob RosnerHave you ever felt like you were an imposition on the staff of a retail chain? That somehow you were getting in the way of what they were meant to do—namely talk on the phone to their friends or discuss the social goings on of their fellow employees? You’re not alone (and yes, I’m a bit jaded on the current state of customer service).

Customer service seems on track to becoming the biggest oxymoronic statement this side of jumbo shrimp and military intelligence. But there is suddenly hope on the horizon and the lessons come from “Safecatch,” a Washington State program to thwart bank robberies.

No that was not a typo, bear with me and you’ll see what McGruff the crime dog can do to improve your business. First some background. Washington was at the top of the bank robbery charts in the United States. Who knew that the rain drove a percentage of the population indoors for this kind of activity?

Note the use of the past tense in describing the bank robbery status. Because suddenly robberies are down by almost half in Seattle, thanks to the Safecatch program. And it’s now being rolled out in cities across the state and country.

So what is the Safecatch secret? Armed security guards in every branch? Better alarms to signal the local police? Better exploding dye packs? Better profiling to spot potential bank robbers as soon as they enter the bank?

No. Safecatch has been called “customer service on steroids.” It’s a program where bank employees greet every person who enters the bank. Looks ‘em right in the eye and gives a big “Hello” and “How are you doing?” to every customer.

In this high tech age, it seems almost laughable that such a low-tech strategy would impact someone carrying a gun with an intent to relieve the bank of a pile of its cash. “Hello” and “How are you doing?” evoke quaint memories of a bygone era, not a cutting edge crime fighting strategy.

But it turns out that bank robbers often crave anonymity. They want to slink-in and slink-out all the while hardly making an impression on anyone. So many are unnerved when they are acknowledged and clearly recognized by someone.

“Hello” and “How are you doing?” How often do your customers get this basic acknowledgment in your business? Chances are, not as often as you think they do.

Even more important, how often are your employees acknowledged and recognized for their efforts? I know what you are thinking to yourself, acknowledge and recognize—isn’t that the purpose of a paycheck? Well yes, and no. Paychecks are great, but they quickly become wallpaper to the average employee. Something easily overlooked. Acknowledgement and recognition keep it real.

If a extreme customer services has had such a big impact on bank robberies, imagine what it will do for your employees and customers. Extreme indeed.

About The Author: Bob Rosner is a best-selling author and award-winning journalist. For free job and work advice, check out the award-winning Check the revised edition of his Wall Street Journal best seller, “The Boss’s Survival Guide.” If you have a question for Bob, contact him via

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Forced Arbitration and the Kagan Hearings

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Deepak GuptaThe forced arbitration of claims arising out of statutory protections for consumers and employees has become a hot topic at the Kagan hearings. The parade of comments by Senators started even before the hearings began, with a written statement by Senator Leahy criticizing the Supreme Court’s 5-4 decision in Rent-a-Center v. Jackson, and similar remarks on the Senator floor by Senator Franken (video of which we’ve already posted here). The topic was raised again in Senator Whitehouse’s opening statement on Monday and in an extended colloquy between Franken and Kagan this morning.

In his statement, Leahy called the Rent-a-Center decision “a blow to our nation’s civil rights laws and the protections that American workers have long enjoyed under those laws.” He noted that “more than one hundred million Americans work under binding mandatory arbitration agreements” and that “most Americans are not even aware that they have waived their constitutional right to a jury trial when they accept a job to provide for their families.”

Congress worked for years on a bipartisan basis to pass laws to protect workers from race discrimination, gender discrimination and age discrimination.  . . . Rent-a-Center is unfortunately just the latest in a line of divisive and devastating Supreme Court decisions where five justices have, in effect, gutted those statutory protections. … Congress should now take a closer look at the way in which binding mandatory arbitration is creating a legal underground where American workers are left without protection.

There is no rule of law in arbitration. There are no juries or independent judges in the arbitration industry. There is no appellate review. There is no transparency. And as a result of today’s divisive ruling, there will likely be no justice for millions of American workers and their families.  The courthouse doors have simply been closed to them.  Today’s opinion also gives big business a disincentive to treat their employees fairly and will no doubt lead to virtually all companies requiring their employees to sign one-sided arbitration agreements as a condition of employment.

Senator Whitehouse’s opening statement at the Kagan hearings struck a similar chord:

Unfortunately, the conservative wing of the current Supreme Court has departed from [the Court’s] great institutional traditions. Precedents, whether of old or recent vintage, have been discarded at a startling rate. Statutes passed by Congress have been tossed aside with little hesitation, and constitutional questions of enormous import have been taken up hastily and needlessly. Only last week, the Rent-A-Center decision concluded that an employee who challenges as unconscionable an arbitration demand must have that challenge decided by the arbitrator. And the Citizens United decision — yet another 5-4 decision — created a constitutional right for corporations to spend unlimited money in American elections, opening our democratic system to a massive new threat of corruption and corporate control. There is an unmistakable pattern. For all the talk of umpires and balls and strikes at the Supreme Court, the strike zone for corporations gets better every day.

Finally, Senator Franken this morning used the hearings as an opportunity to sharply critique not only the recent Rent-a-Center decision, but also the Court’s 2001 decision in Circuit City v. Adams, which rewrote the Federal Arbitration Act to include most employee claims.  The relevant portion of the transcript form this morning’s hearings is available after the jump.

Sen. Franken: I want to discuss something that is denying more and more working Americans that precious day in court, that fair shake, and that’s mandatory arbitration. Now, arbitration has its place. I’m talking about mandatory arbitration. Chances are if you have a cell phone or credit card or if you work, you’re likely to have signed a contract with a mandatory arbitration clause. These clauses basically say if we violate your rights, you can’t take us to court. You have to take it to an arbitrator. But then the fine print essentially says an arbitrator that we pay who depends on us for work and who makes decisions in secret. So a lot of people are denying their opportunity to come before the court.

Circuit City v. Adams

Unfortunately, we’ve seen a series of decisions from the Supreme Court that have made it even harder for people to get that fair shake, as you put it. In 2001 in a case called Circuit City, the Court was asked to decide whether workers’ employment, employment contracts could be subject to mandatory arbitration. This really should have been a no-brainer, because the Federal Arbitration Act of 1925, the law that says that arbitration agreements should be enforced — specifically exempts, quote, “contracts of employment of seamen, railroad employees or any other class of workers engaged in foreign or interstate commerce.”

Organized labor had asked for this specific language to be included to make sure the act would not apply to workers’ employment contracts. In fact, then commerce secretary Herbert Hoover said during a Senate hearing, quote, “if the objection appears to be inclusion of workers’ contracts in the law’s scheme, it might well be amended by states but nothing herein contained shall apply to the contracts of seamen, railroad employees or any other class of workers engaged in interstate commerce.”

Secretary Hoover was saying that if congress wanted to make clear that the Federal Arbitration Act did not apply to employment contracts, Congress should put this language in the statute. So Congress put the language in the statute. But when Justice Kennedy wrote the majority opinion in circuit city, he ignored the history. He wrote, and I quote, “we need not assess the legislative history of the exclusion provision.” Let me repeat that. “We need not assess the legislative history of the exclusion provision.” And based on a strained reading of the law he decided that the exception only applied to workers in the transportation business. Not any class of workers.

This means that instead of all workers getting their day in court in Congress . . . like Congress clearly intended, only transportation workers would get it, and that excludes the vast majority of american workers. General Kagan, I really disagree with this case and the way the court ignored Congress’ intent. That why I was glad to hear your response to one of Senator Schumer’s questions about how the court should interpret statutes. You said that among other things, quote, I think a judge should look to the history of the statute in order to determine Congress’ will. General Kagan, we spent a lot of time in hearings and on the floor debating legislation. How much weight do you think a judge should give to the deliberations of congress and the reasons why we pass the law in the first place?

EK: Senator Franken, the most important thing in interpreting any statute, in fact, the only thing that matters is Congress’ intent. Congress gets to make the laws under Article One of the Constitution. And what the Court should be doing in applying those laws is trying to figure out what Congress meant and how Congress wanted the laws to be applied. That is the only thing that the Court should be doing. Now, sometimes that can be a difficult task. New situations come up. The statutory language is not clear how it applies to those new situations or sometimes congress might simply not have thought of particular situations. Language is by necessity an exact, and so there are going to be cases which —

Sen. Franken: Do you agree with Justice Kennedy, “we need not assess the legislative history” of something?

EK: I would say this. I would say where the text is clear, a court should go with the text. Where the the text clearly covers some situation, the court should do that. The court shouldn’t be writing law.

Sen. Franken: Should the court assess that and make an assessment there?

EK: I think if the text is clear, the court should not rewrite the law. But where the text is ambiguous, which often happens —

Sen. Franken: Wouldn’t you have to assess whether it is ambiguous?

EK: Yes.

Sen. Franken: What Justice Kennedy said doesn’t stand up to that, does that? Let us me move on on that. We in Congress, we want to make sure all of us intentions are clear so 75 years from now the Supreme Court doesn’t just ignore the purpose behind the laws we’re passing. How can we do that? How do we do that? How do we make it clear to future Justices?

EK: Well, the courts surely would be helped if Congress spoke as precisely and exactly and as comprehensively as it could in all situations. You know, there are some instances where the Court just has legitimate difficulty trying to figure out what congress intended and where judges all of whom agree what they should be doing is doing what Congress intended, have difficulty determining that or disagree about what that means. Certainly to the extent Congress can make its intentions clear in legislation and can specifically spell out how it intends for the law to operate, congress ought to do so. To the extent that the court gets something wrong with respect to a statute, and this has happened many times in recent years and in prior years as well. To the extent that the court gets something wrong, of course Congress can come back and change it and make clear that the court got it wrong and also use it as an opportunity even to make clear its intentions with respect to a general area of law.

Sen. Franken: Okay. It’s hard to do 78 years from now, but we’ll try. Circuit City was a Rehnquist court decision.

Rent-a-Center v. Jackson

Just last week the Roberts Court did something better to keep workers out of court and in arbitration. Rent-a-Center has 21,000 workers and hundreds of milions of dollars in annual profits. It forces its workers to sind a mandatory arbitration agreement as a condition of employment. Antonio Jackson, an African-American account manager in nevada had been working for Rent-a-Center for years, but he was frustrated because he watched his company pass him over for promotions again and again. Instead they promoted workers who had less experience and who weren’t black. Although Jackson signed an employment contract agreeing to arbitrate all employment claims, this seemed blatantly unfair and he sued Rent-a-Center.

But the company argued that only the arbitrator could decide whether the arbitration clause was unfair. Let me repeat that.  Rent-a-Center argued that only the arbrator could decide whether the arbitration clause was unfair. Last week the Roberts Court sided with Rent-a-Center.

Talk about not getting your day in court. Now you can’t get your day in court to get your day in court. Now, general Kagan, I know I probably can’t ask you whether I can ask you, but you won’t answer, whether this case was correctly decided, but I would like to ask you still agree with what you said yesterday to Senator Kyl, that one of the glorious things about courts is they provide a level playing field in all circumstances, and that we need to make sure that every single person gets the opportunity to come before the court and gets the opportunity to make his best case and gets a fair shake.

EK: Well, I do agree with that very strongly, Senator Franken. If I might just return to this question of statutory interpretation that you started off with, because I did want to make clear that when a text is ambiguous, which you know frequently happens, which frequently happens, then I think the job of the courts is to use whatever evidence is at hand to understand Congress’ intent. And that includes exploration of Congress’ purpose by way of looking at the structure of the statute, by way of looking at the title of the statute, by way of looking at when the statute was enacted and in what circumstances and by way of looking at legislative history. Now, I think the courts have to be careful about looking at legislative history and make sure that what they’re looking to is reliable, but courts shouldn’t at all exclude signs of congressional intent and should really search hard for congressional intent when the text of the statute itself is unclear.

Sen. Franken: Good. Then I think you and I agree that Justice Kennedy may have been in error when he said that — that the Court doesn’t have to assess the legislative history.

EK: Well, I suspect that — i don’t know the case very well. I suspect that Justice Kennedy may have meant he thought the text was clear, and therefore, the legislative history was not something that should appropriately be explored, but I’m just guessing on that.

Sen. Franken: Okay. I think you’re guessing wrong.

EK: Okay.

This article was originally posted on Consumer Law & Policy Blog

About The Author: Deepak Gupta is a staff attorney at Public Citizen Litigation Group, the litigating arm of the national, non-profit consumer advocacy organization Public Citizen. He also teaches a course in public interest law as an adjunct professor at Georgetown University Law Center, and he previously taught a course in appellate advocacy as an adjunct professor at the Washington College of Law at American University.

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