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Originally Posted by fishbrains
First, many applicants DO accept jobs with little or no vacation. That is simply an indication of how powerless the individual is within our system.
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I disagree.
The total compensation pie is the total compensation pie. The major slices of the total compensation pie are wages, company contribution to health insurance, vacation, sick leave, on-the-job training, formal training, tuition assistance, 401Ks, company contribution to 401Ks, defined benefit pensions and employer contribution, employer contribution to dental insurance and various other benefits.
It is all about employee preference as to which slice of the pie that specific employee wants to be larger at the expense of another slice of the pie being smaller.
Some employees prefer the wage slice of the pie to be larger at the expense of the vacation slice being smaller. Others might like the employer health insurance contribution slice of the pie to be larger at the expense of the wage slice being smaller. These are all trade-offs made both by employers offering a package to attract and retain employees and employees when selecting an employer for which to work - or choose not to work at all.
Quote:
Originally Posted by fishbrains
Second, as we are talking about OT here, you are almost certainly targeting the least legally sophisticated portion of our workforce. Hourly workers tend to have less education, are newer to the workforce, etc. Arbitration sounds good (ooh, I am going to get a fair middleman. Arbitration sounds less expensive...) but in reality precludes employees from suing for legal costs.
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If an employee believes they have been shorted in their paycheck, they should first follow all the internal procedures in place to resolve the situation. Many times, the disagreement is about education about either federal or state law as to what constitutes OT. Is it over 8 hours in a single shift? Is it over 8 hours within a 24 hour time period? Is it over 40 hours within 5 days? Within 7 days? Sometimes it is about classification of exempt vs. non-exempt.
The Alternative Dispute Resolution (ADR) procedure (arbitration or mediation) frequently means that unsophisticated minimum wage employees have access to an impartial arbitrator and don't need an attorney at all. "I worked these hours, here is a my time card that I signed and that my supervisor signed, here is my paycheck -- see I was shorted." During ADR, no amount of fancy lawyering on the part of the employer is going to win when the facts and law are in the employee's favor. This way, the employee doesn't need to pay for legal fees.
Quote:
Originally Posted by fishbrains
Third, these clauses have the effect of precluding class action or multiple employee plaintiff lawsuits.
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Which is a very good thing. Our courts are clogged. The last thing we need is more class-action troll attorneys.
For example, Bill Lerach, a now disgraced & disbarred class action securities attorney, personally earned hundreds of millions of dollars from class action lawsuits against companies whenever the stock price dropped. There were professional lead plaintiffs who constantly bought and sold a single share of stock in companies, and by random chance, one of them would have bought high and sold low, and that would be the basis for a class action lawsuit alleging the company management did something wrong. Because high tech companies' stock is particularly volatile, he targeted Silicon Valley. It was nothing short of legalized blackmail because of class action laws.
Companies faced the choice of (a) spending $30 Million or $50 Million or more on legal fees to win in court when they rarely can recover those attorneys fees from the little plaintiffs who own a single share, or (b) pay Lerach $20 Million or $30 Million to settle out of court. Members of the class typically received pennies -- not even enough for coffee at Starbucks -- and Lerach became immensely wealthy and powerful. His tactics were disgraceful and ultimately held illegal, and he was sentenced to 2 years in prison for obstruction of justice and was disbarred. He was very well politically connected -- as with all such class action bottom feeders, he was a major political donor to the Democratic Party; he was a Friend of Bill Clinton, who had previously appointed him to important national positions.
Lerach famously said, "plaintiffs don't choose me. I don't even take their phone calls. I choose a lead plaintiff, and then I sue. I make all decisions - the plaintiff doesn't get a vote. This is the best business in the world."
In addition to obstruction of justice, he & his former firm were both accused of bribery and kickbacks to these hand-selected plaintiffs. In fact, they
employed these plaintiffs, paying them to constantly buy & sell stock hoping to catch a buy-high and sell-low event.
While the above scenario is about securities class action rather than about labor law, it is clear that class action lawsuits exist to use the public court system to extract untold riches from honest companies while clients do not benefit.
Is that the type of system we want for labor law? I don't think so.
Quote:
Originally Posted by fishbrains
If a company systematically cheats on wages, why should the employees be prevented from joining together in a lawsuit?
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No one is preventing them. There is no law preventing them. An employee agrees up front to work for a company with the rules provided specified, or not to work for the company. Even so, an agreement to go to arbitration does not let a law-breaking company off the hooks from breaking the law.
Moreover, most such labor disagreements are not part of a pattern. Here's a real world example. This actually happened. I know the plaintiff's attorney well.
Juan Gonzalez, an employee of a national casual restaurant chain, was shorted in his paychecks. I think the amount was a couple hundred bucks over several paychecks. Juan Gonzalez (not his real name) was a dishwasher. He was also an illegal alien, as were many other people in the kitchens of these restaurants across the country. Like other illegal aliens, Juan purchased a social security number & name from a broker who sold them to illegals so they could then apply for jobs.
As luck would have it, another illegal alien who worked for the restaurant chain purchased the exact same SS and name. After all, these SS number brokers are not exactly honest people, and the wholesaler must have sold the SS & name to multiple brokers, who in turn sold it to multiple illegal aliens, two of whom went to work for the same restaurant chain.
What are the odds?
Somehow, the hours worked by Juan Gonzalez #1 were treated by the company's computer payroll system (which users names & social security numbers) as belonging to Juan Gonzalez #2. Juan Gonzalez #2 was paid the money owed Juan Gonzalez #1, and Juan Gonzalez #1 was rightfully upset that he didn't get the pay he was expecting and deserved.
How many times does something like this happen? It's one-in-a-million. There is no need for class action status.
At the same time, weird employment stuff like this does happen.
In this case, it means that Juan Gonzalez #1 was paid less than the Federal Minimum Wage for all of his hours, and no arbitration clause prevents pursuit of this violation in Federal Court.
My friend was the Juan Gonzalez #1's attorney for this. He sued for violation of the Federal Minimum Wage. However this national casual restaurant chain has a policy of never, ever settling so as to discourage frivolous litigation. My friend even had the company's Director of Payroll admit to all the facts on the witness stand showing Juan Gonzalez #1 was in the right and the company was clearly in the wrong. The Director of Payroll said on the witness stand under oath, "Yes, we were wrong. Juan Gonzalez is owed the money."
The Federal Minimum Wage is a strict liability law - no explanation or mitigating factors are considered. The existence of Juan Gonzalez #2 is irrelevant. The mistaken identity is irrelevant. The
only issues are: how many hours did Juan Gonzalez #1 work (not disputed), and how much was he paid (not disputed), and the arithmetic calculation of pay/hours (not disputed) and then comparison of that to the Federal MW (not disputed.) There can be no extenuating circumstances.
Juan Gonzalez #1 won, and then the company appealed (because they are stupid), and lost in appeals court. Ultimately Juan Gonzalez got his pay -- several hundred bucks (certainly less than $1K).
And the federal law provides for attorneys' fees, so the restaurant chain paid my friend over $25,000 in attorneys fees.
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