For four-and-a-half years, Jennifer Fultz was for many people the face--make that the voice--of JPMorgan Chase. She worked at a call center in Rockford, Illinois, helping the finance giant's customers with their banking accounts, credit cards, and auto loans. She liked her job, though it paid just $11 an hour, barely enough for Fultz, a single mother, to get by. On three occasions, she says, her team leader presented her with certificates of commendation.
"Once you have so many years under your belt you become very knowledgeable and are able to help customers without putting them on hold or anything," Fultz recalls. "I became very good at my job."
On Monday, September 12, Fultz was summoned to a meeting with the human resources manager at her company, EGS Customer Care. She was given a form and told she needed to sign it. The form, titled "Agreement to Arbitrate," bore the name of EGS's parent company, Alorica. It pledged employees to resolve all workplace claims and disputes through arbitration and not "class action, collective action, and representative action procedures."
Fultz says she asked to see a lawyer and was denied. Instead, she was given thirty minutes to sign or else be deemed to have voluntarily resigned. What happened next highlights both the casual contempt companies like Alorica have for the rights of their workers and the extraordinary courage of Jennifer Fultz, who took a stand on principle rooted in her own family's experience.
This is a story whose reach extends from the lowliest working stiff to the highest court in the land. It concerns a massive corporate-driven rejiggering of the social contract with regard to access to the courts, impacting a huge segment of U.S. workers and virtually every consumer. And it's something most people have never even heard about.
But for Jennifer Fultz, it has meant paying a terrible price. She left work that day escorted by police, with a box of belongings the company had retrieved from her desk. She was fired and lost her health insurance. Her former employer initially fought her efforts to obtain unemployment benefits. She went from living paycheck to paycheck to struggling day by day. She is still reeling from the unfairness of it all.
"Why should anyone be faced with that kind of choice?" she asks, through tears. "To choose between supporting your family or giving up your employment rights?"
But it's not at all uncommon. Encouraged by court rulings, corporations are increasingly insisting that those they do business with, and those they employ, agree to handle disputes through arbitration. In some cases, this makes pursuing certain claims practically impossible. In others, it dramatically tilts the balance in favor of the companies.
"It's huge nationally, what's happening," says Seth Goldstein, a union-affiliated lawyer who has filed a labor complaint on Fultz's behalf. "It's gigantic. It's a sweep against everybody. It's a sweep against consumers. It's a sweep against employees. It's a sweep against people who use financial institutions and nursing homes. It's the biggest racket. It's a modern-day yellow-dog contract. It's a prohibition against collective action."
Yellow-dog contracts, in which workers must vow not to join unions as a condition of employment, were in widespread use until the 1930s, when they were outlawed. Critics of mandatory arbitration agreements say they similarly violate the National Labor Relations Act, which expressly protects workers who join together for "mutual aid or protection."
The National Labor Relations Board (NLRB) has in recent years consistently held that these agreements are illegal. But the courts are divided, with some agreeing and some saying that the Federal Arbitration Act trumps the labor law. The case is almost certainly destined for Supreme Court review, probably next year.
But, in the meantime, employees like Fultz are still being forced to give up their rights or give up their jobs.
Chances are you've agreed to them. They are clauses included in all kind of contracts and in the fine print you don't read before clicking the button that says you have. Amazon uses them. So does Google, Netflix, eBay, and Travelocity. The clauses...