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Metastasization of
Mandatory Arbitration
Kenneth M. Piper Lecture
Chicago‐Kent College of Law
April 10, 2018
Catherine Ruckelshaus
General Counsel
National Employment Law Project
cruckelshaus@nelp.org
(1) It’s bad for workers.
(2) It’s bad for law‐abiding companies.
(3) It’s bad for our economy.
1
It’s bad for workers.
• It’s rigged: company picks the arbitrator and pays for the
proceeding; it’s a repeat player.
• It’s secret: no transparency, no public reporting before or
after.
• It’s one‐by‐one: class and collective waivers effectively bar
claims, especially for low‐wage workers.
• Empirically, workers who do get to arbitration get less.
• Competition and the race‐to‐the‐bottom:
everyone’s doing it.
• No common‐law understanding of rule of law and
corporate behavior.
• Business plans hard to develop in lawless
environment.
2
It’s bad for our economy and communities.
• Billions lost every year in wage theft takes money away
from local economies.
• Millions of lost payroll taxes and insurance premiums paid
to federal, state and local governments.
• Lack of employer accountability means that rule of law
doesn’t mean anything and safety nets and baseline
protections fail.
Professor Cindy Estlund’s research shows
98% of claims brought in court are not
brought in arbitration.
315,000‐722,000 individual workplace claims
lost in “black hole”.
This results in employer exculpation and
judicial abdication.
3
Bright spots?
• Legislative fix needed at the federal level. (See
legislative round‐up in the materials).
• Epic Systems trio of cases any day now.
• States and cities are very limited in what they can
enact, but that hasn’t stopped proposals.
• #MeToo movement has generated bipartisan
interest.
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