Jul 5, 2024 Michael C. Duff
In Adding Insult To Injury: How Kansas’s $155,000 Cap On Permanent Total Disability Benefits Sets Up Injured Kansas Workers For A Lifetime of Hardship, author Gabrielle Stein effectively explodes the fiction that a workers’ compensation “grand bargain” continues to exist in Kansas. Workers injured in the workplace in the United States because of the conduct of their employers—whether negligent or innocent—are limited to state-based statutory benefit recoveries in lieu of tort damages.
The exchange of benefits for damages is often imagined to be a grand bargain in which workers give up full legal damages in exchange for extremely limited statutory workers’ compensation benefits consisting of indemnity wage benefits and payment for medical expenses. This insulates employers from tort liability and is supposed to also inure to the benefit of employees, whose tort claims might be difficult to establish and might otherwise be subject to an “unholy trinity” of affirmative negligence defenses abrogating a negligence claim: contributory negligence, assumption of the risk, and the fellow-servant rule.
Of course, the unholy trinity would be ineffective to bar negligence claims under current law in all but four American states—which have since the mid-twentieth century moved on from “absolute” defenses to a comparative negligence system—so the conceptual underpinnings of workers’ compensation have been seriously undermined (if not rendered irrational). But Ms. Stein additionally shows that any pretense that the workers’ compensation bargain is at least adequate is silly in Kansas given an indemnity cap of $155,000 for a permanent total disability claim.
Imagine a young worker rendered permanently totally disabled at age eighteen. One need not be unusually proficient in math to realize that $155,000 for fifty years of lost work is a very bad bargain—one which any knowing worker would find unacceptable. The situation is especially repugnant when an obviously negligent employer is practically exonerated for its conduct under such a scheme. In most states, a permanently totally disabled worker is entitled to full workers’ compensation benefits for the rest of her working-age life The permanently disabled young worker in the hypothetical at the beginning of this paragraph would be entitled to indemnity benefits equivalent to roughly the state average weekly wage until age sixty-seven. The startling discrepancy is especially repugnant when an obviously negligent employer is practically exonerated for its conduct under such a scheme. The risk of a race to the bottom is real.
Ms. Stein provides real-world examples of how Kansas workers would be economically destroyed under such a system. She then explains in plain language the concept of a “cost shift.” (Pp. 405-10.) As I similarly and routinely explain in my torts and workers’ compensation classes, someone will pay for the cost of injury. If the injuring industry does not pay the cost, it will be shifted either to the injured worker and her family, or to taxpayers supporting the social security system. In other words, someone is going to pay, and the policy choice of who will pay is often concealed.
The author also shares some rather startling facts about the exceptional profitability of the workers’ compensation insurance industry. (Pp. 410-13.) The article is worth reading for that reason alone. According to the author, “[o]n a national level, National Council for Compensation Insurance (‘NCCI’) insurers raked in an underwriting profit of 14.6 percent in 2019. This percentage means these insurance companies used 85.4 percent of the premiums collected through workers’ compensation insurance policies to pay out claims and incurred expenses and then got to pocket the rest. This is the second-highest underwriting profit for NCCI insurance companies since the 1930s.”
The key point is that “[e]mployers’ workers’ compensation insurers are accumulating high underwriting gains largely because the number of claims being paid out by insurers have dramatically dropped. The dramatic drop is likely due to legislative and regulatory ‘reforms’ that have reduced or, in some cases, denied the compensability of workers’ compensation claims.” (P. 412.)
Ultimately, the article is about legislative supremacy. (P. 414.) May a legislature whittle workers’ compensation down to this extent, effectively exploding both workers’ compensation and tort in one fell swoop? In many states, the answer is “no,” because the state’s constitution limits the extent to which historic rights may be compromised. Kansas—and apparently four other states—renders its state legislature as supreme as old King George in this regard.
The central claim of the article is that the Kansas legislature should intervene on fairness grounds to correct the evisceration of worker injury rights. Yet, because it was the legislature that created the problem in the first place, an additional virtue of the article is that it provokes the reader to realize that a fairness-based legislative solution has not been effective (which for me has prompted more exploration of federal constitutional theories for rectification).
It would be a mistake, however, to assume that workers’ compensation was once “ok” but has been eroded since its golden age by a series of relatively recent predations. The original Kansas workers’ compensation act was hardly friendly to workers. In fact, it was horrible. For a permanently totally disabled worker it provided 50% of the injured worker’s preinjury average weekly wage as an indemnity benefit, compared to two-thirds provided under most modern statutes. Kansas also provided a mere fifty days of medical benefits, compared to the 100% employer-paid medical benefit for the duration of the injury that is provided for in all but a handful of states in present times. (Ch. 218, March 1911.)
All of this austerity existed in the historical era predating social security or the welfare state. The story of workers’ compensation from the perspective of injured workers is: it started out badly (but was better than nothing); it was improved through the 1940s and 1950s, and then went into a period of decline that was so severe it prompted a National Commission on Workmen’s Compensation in the early 1970s. It got a bit better in the late 1970s as the threat of federalization of the system was seriously contemplated; and then again (perhaps predictably) it went into decline.
The waves track thinning union density in the United States almost perfectly—Kansas has only been surfing those waves. But Ms. Stein ably reminds us how easy it is for workers’ compensation—the oldest body of employment law in the United States—to hit rock bottom unless the erosion is resisted.
Jun 11, 2024 Cesar Rosado Marzán
“Do me a favor, just get your union guys, your leaders to endorse me. And I’ll take care of the rest … your current negotiations don’t mean as much as you think.” Donald Trump speaking to striking autoworkers in Michigan.
Today’s U.S. labor law scholarship typically asserts a broken or dead discipline. With a mere 6% of private sector workers in unions or covered by collective bargaining agreements, labor law appears irrelevant to most workers. Scholars thus try to come up with ideas to rebuild labor law through novel interpretations of statutory texts or through statutory reform, such as the Employee Free Choice Act and the Pro Act. While attempts to breathe new life to U.S. labor law via legal reform is important, sometimes it makes sense to reflect on how labor law as a political project came to being, how it lost its luster, and how to rebuild it. Democracy at Work: Contract, Status and Post-Industrial Justice, by Ruth Dukes and Wolfgang Streeck, a law professor and a sociologist, respectively, draws on this this tradition anchored in political economy and the social sciences.
Labor Law as Part of a Political Project
According to the authors, labor law was an essential part of a 20th century project aiming to build an entirely new political economy (P. 6). They highlight the work of American socio-legal scholar, Phillippe Selznick and German legal scholar, Hugo Sinzheimer, to explain how labor law played a key role in reconstructing institutions to sustain a bigger project for “industrial democracy.”
Selznick, writing in 1969, favored labor unions because they could moderate inequality and cement common values. For Selznick, firms were thirsty to move out from systems based on arbitrary power toward “legality” (P. 25). While firms did not necessarily want labor unions, a certain consensus emerged: labor unions could help develop that legality (P. 26). Selznick thus conceptualized firms as a polity, where union workers, backed by labor law, could prevail as rights-bearing citizens with a voice (P. 26).
Sinzheimer wrote decades earlier than Selznick, in pre-Nazi Germany. He was associated with the brain trust of the Weimar Republic (1918-33). Like Selznick, he argued that labor unions could serve useful roles in regulating the economy. A democratic government needed to help create unions via a “constitution” (P. 36): “a set of legal rights and procedural rules intended to facilitate the involvement of labor as a collective actor….” (P. 36). Labor law was one piece of that constitution (Pp. 36-37).
Read together, Selznick and Sinzheimer contribute to an idea of industrial democracy.
Contract and Status
One of the main functions of industrial democracy was to give workers a new status, that of industrial citizens, be it at the firm and/or government level. That new status replaced earlier ones afforded by tradition or custom: “father, wife, master, servant.” (P. 6). By status, Dukes and Streeck refer to rights and obligations that accrue to parties by reason of their membership in a socially or legally defined group (P. 6). The alternative to status is contract, or voluntary agreements where parties set up terms for themselves (P. 6).
Reformists accepted the status/contract dichotomy and argued that labor law could liberate workers from traditional status roles, and give them the capacity to contract meaningfully, as workers, no longer tethered to ascribed roles from the past (P. 8).
In the 1970s, however, capitalism entered a state of crisis that led many industry leaders to rethink, among other things, the idea of industrial democracy and its statuses (protected forms of labor), which generated certain rigidities for competitive firms (P. 57). The answer was a different iteration of contract linked to private property rather than to public law, or government regulation (Pp. 60-61).
Occupational Communities
Despite the return of various forms of subordination via contract anchored in private property, Dukes and Streeck point to so-called “occupational communities”, or group of workers who perceive themselves as working in a similar line of work, who develop a collective identity, and share some values, norms, and expectations for work and life (P. 111).
Employers might opportunistically tap into the values of occupational communities’ to further exploit workers (P. 117). For example, Linda Burnham and Nik Theodore have shown that domestic workers might overwork themselves because they feel deeply bound, professionally and morally, to a client. But occupational communities can also mobilize those same aspirations to seek collective solutions to overwork, demand better conditions, pay, or training to improve their work (Pp. 112-113). Dukes and Streeck thus envision emancipatory possibilities through occupational communities.
What Democracy at Work Means for the U.S. Today
There is lots to learn from this book. But here I want to point at its lessons in light of populism, such as Donald Trump’s.
The demise of industrial democracy might have brought a new era for contract and markets. In recent years, however, contract and markets have also lost significant luster with the public. As the epitaph above shows, in an institutional context weakened by neoliberals, it is easy for populists such as Donald Trump to tell working people who have experienced deteriorating economic conditions to eschew economic elites, markets, and to give up on their own collective efforts.
Populist politicians take on the mantle of “Great Leader” asserting they will take care of workers’ problems through their direct relationship with “the people,” promoting a social contract devoid of mediating institutions. But, as we learn from Dukes and Streeck, status will fill the gaps of whatever social bargain the people conclude with populist leaders, especially in the absence of mediating institutions.
A mass of workers without institutions will find themselves subordinated to that Great Leader – he is the leader after all – and the institutions that the Great Leader creates, public or private. The loss of unions and industrial democracy should thus be understood not only as a win for neoliberalism, but also for today’s populists, autocrats, and authoritarians.
Dukes and Streeck make it clear that they harbor no illusions of what it will take to rebuild industrial democracy – “institutional reconstruction on a major scale and over an extended period of time, not just of work regimes but also of capitalism as a socio-economic order” (P. 2).
If they are right, the task is enormous, but there is hope. After all, the occupational community of U.S. union workers refused to relinquish their agency to the Great Leader, supported the United Auto Workers union, and won a historic strike last year. A political project to expand that occupational community seems to be the task at hand. Law needs to be part of that political project. It should lift workers to a higher status, represent their values and aspirations, and reconstitute institutions to heal our beleaguered democracy.
May 9, 2024 Kerri Lynn Stone
I have always been intrigued by the adjudication of workplace retaliation claims by U.S. courts. The act of retaliation itself, and the myriad ways that it is accomplished, is interesting because it can be subtle, “served cold” (delayed), or barely perceptible. With that in mind, I recommend to you Daiquiri J. Steele’s Rationing Retaliation Claims. In this piece, Professor Steele thoughtfully takes on the issue of the U.S. Supreme Court’s “fear of opening the floodgates” of litigation when it comes to retaliation claims in the employment context. Professor Steele concludes that this fear is “overstated and misplaced,” a conclusion that I think is correct, and is also thoughtfully reached and well researched. This makes her piece a great contribution to the current discourse on this most important topic.
Professor Steele argues persuasively that rather than sounding the alarm when it comes to the uptick in retaliation claims filed by employees, we should be paying heed to them, as they are a sign of intra-organizational conflict. Significantly, Professor Steele notes, these claims are properly surging, because, as her research documents, the practice of retaliation is surging. Moreover, according to Professor Steele, “considerations of judicial economy are particularly misplaced in workplace retaliation cases,” because it is precisely the anti-retaliation statutory mechanisms and provisions that give civil rights statutes any teeth, so to speak, and enable plaintiffs to even think about coming forward to vindicate their rights without being intimidated.
As Professor Steele plainly puts it, “[a]ttempting to limit judicial caseloads through restrictive interpretations of anti-retaliation laws eviscerates private enforcement, producing under-enforcement of these core civil rights protections.” She argues that, whereas the Supreme Court has been moving toward increasingly restrictive reads on statutory protection from retaliation, the path forward lies in legislative reform.
Specifically, Professor Steele posits that it is now incumbent upon Congress to create a mandate for courts to employ a broad interpretation of every workplace anti-retaliation statutory provision. By adopting such a rule of construction, Professor Steele argues, Congress would “strengthen critical civil rights safeguards for employees by restoring the optimal and essential function of retaliation provisions.” This bold proposal is couched in a thoughtful analysis of congressional intent, legislative history, and policy objectives surrounding workplace regulation.
Moreover, as Professor Steele reminds her reader, the fear of retaliation inherent in trying to vindicate employee rights, unchecked, can keep people from utilizing the law to engender equality and fairness when it comes to areas such as “discriminatory hiring, firing, and promotion decisions; harassment; pay inequity; wage theft; occupational safety and health hazards; and family and medical leave encroachments.”
What I really “like lots” about this piece is the way that it squares off against the perennial argument given for opposing the broad construction of all portions of workplace statutes—including their antiretaliation provisions. This arguments is that broad interpretations usher more people in under the protective umbrellas of the statutes and loosen/open the proverbial “floodgates of litigation,” and that restrictive interpretations are needed to stave off this result. In the first place, it is wonderful that the piece laments and documents the repetition of floodgate concerns by courts as the proliferation of their use to substantiate overly-restrictive statutory interpretation.
I also really liked the way Professor Steele used facts to contradict the unfounded fears and assertions of those with “floodgates” fears. For example, she maintains that “there is a difference between keeping the floodgates from opening and closing them,” but notes that while “The Nassar Court [which adopted a but-for causation standard for Title VII retaliation clams] seemed to suggest that a change in the Title VII retaliation causation standard would do both,” the hard, cold “data shows that it has done neither,” and cites to data put out by the EEOC.
The other thing that I really “like lots” about Professor Steele’s scholarly voice in this piece is the frankness and freshness of her observations and contentions. At the end of the day, she says, irrespective of the threat of “floodgates” bursting open if courts utilize broader interpretations, the fact remains that “changing substantive law to decrease workload is itself dysfunctional.” This piece is rife with such sharp, fresh observations, and this, combined with the care that Professor Steele took in tracing back the history and impact of the so-called “floodgates” argument, makes for a most valuable contribution to the literature.
Ultimately, Professor Steele makes a most persuasive argument that, as she puts it, “Floodgates arguments are incongruent with anti-retaliation laws.” Her discussion of the incentives and deterrents inherent in the construction of antiretaliation provisions is excellent, as is her analysis of current caselaw, like the Nassar case, to which a whole section is devoted. Her engagement with courts’ floodgate concerns is as thorough as it is thoughtful. Specifically, her discussion of judicial inconsistencies when it comes to these concerns and her incorporation of social science into that discussion makes this piece more than just the exposition of a proposal worthy of thought, but a rounded-out discussion that supports and methodically leads the reader towards her proposal.
Professor Steele makes the excellent point that her proposal is not completely unprecedented, and her discussion of both RICO and the Americans with Disabilities Act in that vein is smart and persuasive. By the time the reader gets to the piece’s call for Congress to draft a statute that mandates the broad interpretations of anti-retaliation provisions, the foundation with respect to the need for it has been excellently laid. The idea itself is truly food for thought. I intend to run it by my students; it is an excellent springboard for the discussion of the efficacy of workplace legislation.
Apr 9, 2024 Michael Z. Green
In his recent essay, Professor David Yamada (Suffolk) provides an enlightening introduction to the law of workplace safety with respect to the Occupational Safety and Health Act of 1970 (OSH Act) and its enforcement by the Occupational Safety and Health Administration (OSHA). Because the limits of the OSH Act and OSHA’s role in workplace safety became highlighted to all essential workers in American society during the recent COVID-19 pandemic, the importance of continuing to explore better safety protections for employees remains a pressing public concern. Yamada’s essay covers the important role that the OSH Act and OSHA play in workplace safety in a succinct manner while he also points to failures to provide more remedies for workers’ mental health after being subjected to toxic workplaces, and particularly due to workplace bullying, as a fallout from COVID.
Yamada’s stated goal is “to contribute to a needed conversation about policy options for extending the regulatory reach of the OSH Act to cover severe psychological harms at work and to anticipate expanded enforcement responsibilities for OSHA and its realm.” (P. 395.) Unfortunately, very few workplace law professors analyze the OSH Act or OSHA in their scholarly endeavors. Before now, Jotwell’s Worklaw Section has covered only one publication addressing an OSH Act or OSHA issue: back in 2017. This lack of scholarly attention to OSHA is surprising in light of the agency’s existence for more than fifty years and its key presence as exemplified when a national pandemic arose in 2020 affecting the health and safety of so many workers.
Yamada starts by offering an interesting introduction to workplace safety law and the origins of the OSH Act and OSHA. (Pp. 395-97.) The OSH Act’s general duty clause requires that employers must provide a safe workplace free from recognized hazards that may lead to physical harm. (Pp. 397-99.) Yamada also notes that the OSH Act and OSHA have been subjected to “consistent criticisms from both the political left and the right” as unions want stricter enforcement and employers want lesser restrictions. (Pp. 398-99.) This clear and concise discussion of the origins of OSHA and the OSH Act and how they operate in practice offers a valuable resource to all workplace law scholars whether new to the field or long-time discussants.
Yamada starts his analysis by reviewing the Surgeon General’s October 2022 report establishing a framework for “Workplace Mental Health & Well Being” that “recognizes the unique and challenging workplace circumstances generated by the COVID pandemic” while also “listing survey data suggesting mental health impacts … [created by] the COVID pandemic.” (P. 393 and n.3.) Although that report lists “bias, discrimination, emotional hostility, bullying and harassment” as sources of psychological harm from COVID, Yamada recognizes that workplace safety law does not clearly regulate the psychological harms caused by workplace bullying. Yamada discusses his own herculean efforts to have Congress and the states pass specific laws that prohibit workplace bullying and acknowledges those efforts have not led to any real success. (Pp. 404-05.)
As a result, Yamada proposes two changes to allow the OSH Act and OSHA to address this problem of bullying and other psychological harms to workers as a safety concern that became highlighted as an impact from COVID. First, Yamada asserts that the OSHA general duty clause can be interpreted more broadly to cover workplace bullying as a hazard that causes serious harm to workers even though the language only refers to “physical harm.” He equates this extension to the general duty clause by relying on OSHA’s prior extension of the general duty clause to cover workplace violence. Second, Yamada argues that the OSH Act can be amended by adding language in the general duty clause to include “psychological harm” to the obligation of providing a workplace free of any recognized hazard that is likely to cause physical harm to an employee. Yamada notes that OSHA will have to develop guidance on how to distinguish everyday occupational stressors from serious psychological harms occurring in the workplace.
Yamada ends his argument in support of extending psychological harm to the OSH Act and OSHA by looking at international standards. According to Yamada, “international standards leave the United States distinctly behind the curve in adopting legal responses to severe psychological harms at work.” (P.409.)
Yamada accepts that for his proposed changes in policy to occur, OSHA would have to invest a tremendous about of time and resources in training and funding to help educate inspectors and other constituents in understanding the dynamics of how workplace bullying leads to psychological harm for workers. He notes that such an undertaking by OSHA, an underfunded and understaffed agency, is unlikely to occur. Yamada also recognizes that Congress may not likely address these concerns any time soon and OSHA does not have the current structure to tackle new challenges without congressional support. Nevertheless, Yamada is committed to fostering some ongoing level of discourse on this workplace safety concern.
Although Yamada’s essay makes convincing arguments for reforms to the OSH Act and OSHA based upon psychological harms to workers, especially with respect to bullying, those changes admittedly will not likely occur in the present or even the immediate future. Nevertheless, Yamada’s thoughtful explanations and observations about the OSH Act and OSHA in practice and what those safety protections could offer to workers in the future is an essay that I like a lot.
Mar 13, 2024 Henry L. Chambers, Jr.
In Limitation of the “Four-Fifths Rule” and Statistical Parity Tests for Measuring Fairness, authors Manish Raghavan & Pauline T. Kim critique the use of the four-fifths test and other statistical parity tests (SPTs) in employment decision making. The article discusses how SPTs have been used historically to identify adverse impact as part of a disparate impact discrimination inquiry and how SPTs are being used now, and how that may obscure algorithmic discrimination.
The article is intriguing because it discusses where we have been, where we are, and where we may be going regarding the use of SPTs and algorithmic discrimination. That is especially important because the use of algorithms in employment decision making is likely here to stay. Algorithms can be used to screen job applicants for later evaluation or to rank job applicants for sequential hiring or for other purposes. Concerns regarding the possibility of discrimination through algorithmic use are common. Indeed, various jurisdictions, including New York City, require audits of employment selection algorithms before they are used.
The article provides a good primer on the law regarding SPTs and a discussion of their historical use. The article explains the employment law issues, such as the difference between a finding adverse impact and a finding of disparate impact clearly. It also discusses the problems and possible benefits of using SPTs retrospectively and prospectively, providing a balanced and nuanced approach to using tools that have been used bluntly in the employment context.
As they discuss the uses and misuses of SPTs, the authors suggest how SPTs can be used more judiciously in assessing whether an employment rule has triggered an adverse impact with respect to a known applicant pool. In addition, they propose measures to be used in combination with SPTs to help designers craft algorithms that are fair and nondiscriminatory, rather than algorithms designed in part merely to avoid a finding of adverse impact and possible discrimination claims. The authors’ suggestions regarding the prospective use of algorithms are especially important, as the use of algorithms by employers is unlikely to diminish.
The article is rich with wonderful insights. Three key points stand out.
First, the four-fifths test, the simplest of the SPTs and initial focus of the article, has been used as a rule of thumb to help identify possibly discriminatory rules, but it is not very good at the task. Any employment rule may disqualify a higher percentage of some groups of applicants than other groups of applicants. The core issue is how much adverse impact is sufficient to trigger the need to examine whether the rule might cause an unlawful disparate impact.
The four-fifths test is violated, for example, when the use of a rule yields a selection rate of one racial group is less than 4/5ths of the selection ratio of another racial group. Federal agencies have historically treated the violation of the rule as evidence that an employment rule has had an adverse impact on the under-selected group based on race. That typically triggers further evaluation of whether the rule caused a disparate impact on the group that might violate an employment discrimination statute.
However, the authors note the four-fifths rules is an unsophisticated statistical tool that is both overinclusive and underinclusive in detecting discriminatory conduct. Nonetheless, when used carefully, the rule and other more sophisticated SPTs, can help identify when an employment rule should be scrutinized for possible bias.
Second, the recognition of algorithmic discrimination has led algorithm designers to use the four-fifths test prospectively to attempt to avoid a finding of adverse impact and, they surmise, discrimination. That approach has a number of problems. As noted, the four-fifths test is not an accurate test of adverse impact or discrimination.
In addition, any prospective use of SPTs has a “data-dependence problem” because no data set that is defined prospectively to test the employment rule will necessarily match a subsequent applicant pool. More troubling, concentrating on the results of the prospective use of an SPT can trigger a focus on adverse impact rather than validity, i.e., the algorithm’s ability to identify the strongest set of applicants.
When designers focus insufficiently on an algorithm’s validity, the resulting algorithm may be discriminatory – though it does not violate the four-fifths test – but also may not help the employer make better employment decisions. That is a lose-lose situation.
Third, SPTs and other measures can be used to audit algorithms to lessen discrimination and encourage the accuracy or validity of the underlying algorithm. Though the authors provide recommendations that can help make algorithms better, they caution that even their interventions will not guarantee algorithms will not discriminate.
Anyone who is interested in employment law should read this article. The breadth of coverage makes the article a good read for those who think about employment law and those who practice or seek to practice employment law. It also may be helpful to employers and non-lawyers who care about employee selection processes. For those reasons, it is a Thing I Love Lots.
Feb 13, 2024 Joseph Seiner
In The Causation Canon, Professor Sandra Sperino performs a superb analysis of the Supreme Court’s evolving analysis of causation standards. The piece carefully synthesizes the decisions in this area, identifying a new canon of statutory interpretation now used by the Court – coined by Professor Sperino as the “Causation Canon.”
The law with respect to causation has always been muddled. In the field of employment discrimination law and worklaw more generally, causation has persistently presented a tremendous burden to claimants in the field. While establishing causation in other areas of the law may often be much more straightforward, showing discriminatory employer intent can present a Herculean task. There are a variety of reasons for the difficulty, including that so much of the critical information in such cases often resides with the employer and can be notoriously difficult to uncover. Personnel files, worker emails, and other critical evidence may not be readily accessible to a worker who has been recently fired, or may be accessed only at substantial cost during discovery. Yet the law requires that causation be established to recover in most workplace cases, particularly with respect to disparate treatment employment discrimination claims.
Professor Sperino’s groundbreaking paper identifies the new way that the Supreme Court has approached statutory interpretation with respect to issues involving causal determinations. As she identifies the Court’s new doctrine, which has evolved over the past decade, “[w]hen a statute uses any language that might relate to factual cause, the Court will assume that Congress meant to require the plaintiff to establish ‘but-for’ cause.” (P.704.) Professor Sperino traces the doctrine back to 2013. Prior to this time, she notes that the Court looked at each statute individually in determining how to interpret factual cause in each matter. Over the past decade, however, the Court has looked at causation differently, assuming that the but-for requirement exists universally across statutes.
Professor Sperino discusses the questionable way the Supreme Court has justified this new canon. Indeed, the Court purports to rely on ancient common law to support its interpretation and application of causal standards when interpreting statutes. Professor Sperino expertly highlights through the examination of numerous cases how such a standard did not previously exist. In particular, she closely explores the Price Waterhouse v. Hopkins and Gross v. FBL Financial Services cases (which both arose in the employment law context) to demonstrate that this doctrine is a new phenomenon. Professor Sperino then turns to Court cases issued in the last decade, most notably the Nassar, Burrage, and Comcast decisions, to highlight the development of the Court’s so-called “Causation Canon.”
The implications for employment discrimination plaintiffs are immediate, given the noted difficulty with establishing causation. Generally, the canon identified by Professor Sperino means that it will typically be even more difficult for victims of discrimination to overcome this hurdle. Of course, Professor Sperino‘s theory means much more than this, and is not limited exclusively to employment matters. Indeed, the Court’s new doctrine, as identified by Professor Sperino, would extend to all federal statutes. Nonetheless, causation is typically the critical determination in most employment discrimination cases. The McDonnell Douglas test, which Professor Sperino has examined extensively in her prior research (see, e.g., McDonnell Douglas: The Most Important Case in Employment Discrimination Law, (Bloomberg)), is still an evidentiary standard of causation with which the courts struggle and offer differing opinions even half a century after the case was first announced.
The genius of this work is the masterful way in which Professor Sperino synthesizes the shortcomings of the Supreme Court’s analysis. Given her extensive expertise in this area, Professor Sperino is uniquely situated to demonstrate how the Court’s announced underpinnings for its standard — more specifically ancient common law – is at odds with the new canon that it purports to develop. As she correctly notes, the “causation canon creates a stand-alone factual standard. In contrast, the common law uses a bundled approach” where in some circumstances it was recognized that “this standard does not work well.” (P. 705.) In those situations, prior to 2013, the law would “adapt[] by changing the subject of the standard, or the party required to prove it.” Id. After the creation of this canon, however, the Court “has made a powerful substantive choice” by favoring the stand-alone approach, and has “magnified this choice by imposing it as the default for factual cause in all federal statutes.” Id.
The identification of the causation canon alone will prove extraordinarily helpful to those researching in this area, and in analyzing any causation questions which are likely to find their way to the courts. Perhaps more importantly, however, the Supreme Court should own the new theory that is has silently developed and not be permitted to quietly rely upon an unsubstantiated examination of past precedent. The causation standard has already created difficulty for plaintiffs in the workplace context. Now, through a clearer understanding of this canon, as identified and detailed by Professor Sperino so well, plaintiffs will have more clarity when litigating in this area. In this way, the paper is far more than theoretical, and provides a valuable and practical resource for employment law advocates.
At the end of the day, The Causation Canon, which is extensively well-researched and wonderfully written, will serve as the new statement of statutory construction issues related to causation. Unfortunately, the Court’s new approach likely creates an even greater hurdle for workplace plaintiffs, who already faced numerous procedural challenges even prior to this new doctrine. As Professor Sperino correctly observes, “[t]he causation canon is still in its infancy . . . it is worth considering whether the Court should abandon it.” (P. 744.)
Jan 10, 2024 Joseph Slater
Jeffrey M. Hirsch,
Labor Law’s Impact on the Post-Dobbs
Workplace, UNC Legal Stud. Rsch. Paper No. 4557256, available at
SSRN (Aug. 30, 2023).
Dobbs v. Jackson Women’s Health Organization, 579 U.S. 2228 (2022), meant that the ability to choose an abortion was no longer a right protected under the U.S. Constitution. Instantly, pre-existing bans or extreme limits on abortion in some states went back into effect, and other states adopted new bans and restrictions. This is likely not news to readers of this blog. What likely will be news—and useful news at that—is that labor law may help both unionized and non-unionized workers fight for and achieve abortion-related benefits at the workplace. Jeffrey Hirsch’s Labor Law’s Impact on the Post-Dobbs Workplace is a timely, informative, and well-balanced approach to this issue that I recommend to anyone interested in the intersection of workplace rights and reproductive rights.
Hirsch starts by noting that “[a]ccess to abortion and other health care depends on employers to an unappreciated degree.” That’s because most health insurance is provided by employers. Further, employer policies involving leave and scheduling can also affect abortion access.
He then shows how labor law can help non-unionized employees. Specifically, Section 7 of the National Labor Relations Act (NLRA) gives all employees it covers the right to engage in “concerted activities for . . . mutual aid or protection.” This section protects all employees the NLRA covers, not just those in or trying to form unions, when they act together on matters relating to wages, hours, and working conditions. This right is not as well-known as it should be, but it provides protections for workers advocating for, e.g., employer-provided benefits relating to abortion.
Hirsch describes the basic rules for what constitutes “concerted” and “protected activity,” and how this advocacy could bring better abortion-related rules, including health insurance coverage, leave, travel benefits, and privacy protections. Hirsch delves into the details of each type of benefit. For example, he notes that the AFL-CIO has published model collective-bargaining agreement language for abortion benefits. Also, while there is little precedent on non-unionized employees pressing for privacy protections Section 7, he argues convincingly that it should be covered.
The article then explores another interesting issue under Section 7: political activity designed to elicit employer support. While it’s clear that Section 7 covers activity such as political support for a raise in the minimum wage, other types of political activity (such as “A Day Without Immigrants” protests) create closer questions as to whether they have sufficient connection to workplace issues. Political activity aimed to garner support for specific employment benefits will likely be covered; protests of laws limiting abortion access are less likely to be (although as always, in close cases, rulings may well depend on which party holds a majority on the National Labor Relations Board).
The article then discusses unionized employees. Such employees have a right to bargain collectively about many possible employer-provided abortion benefits. Hirsch notes a few possible proposals that could raise issues over whether the topic was a mandatory subject of bargaining. The most interesting and important of these, I believe, is the issue of whether travel benefits for abortion would be considered an illegal subject of bargaining in states with laws that purport to make travel for abortion illegal. Hirsch notes that such laws may well not withstand constitutional scrutiny. But unless and until such a law is struck down, a union’s only argument would be NLRA preemption. And Hirsch fairly concludes that the preemption argument may not be a winner.
This is an excellent piece. In the spirit of continuing this important conversation, I wonder whether the scope of NLRA coverage limits the respects in which labor law might usefully protect abortion access for workers. While the NLRA covers most private-sector employees in the U.S., it has some significant exclusions. Hirsch mentions that supervisors and independent contractors are excluded. Given the increasing number of women in both higher-level positions and classified as independent contractors, this is a limitation on the NLRA strategy.
More broadly, as those who know me would predict I would say, the NLRA excludes public employees. I will note that many states have public-sector labor laws that grant covered employees’ rights similar or identical to NLRA Section 7 and collective bargaining rights. However, a number of states do not provide robust labor rights to most or all public employees. Not surprisingly, there is a significant overlap between the states that do not provide robust union rights for public employees and those that have imposed significant restrictions on abortion rights (for example, Texas). But in the many states that do give robust bargaining rights to public employees, Hirsch’s discussion would be equally relevant (except for the preemption issue).
I would also have been interested in Hirsch’s thoughts on “internal union politics” issues in this area, assuming not all local unions will have majorities in favor of these rights. But overall, Hirsch makes a valuable contribution by suggesting a potentially very useful tool that reproductive rights advocates should be aware of. I liked this article a lot and I look forward to reading more from Hirsch and others writing on this topic.
Nov 29, 2023 Anne Marie Lofaso
The National Labor Relations Act is infamous for its weak remedies, particularly the Board’s lack of authority to grant punitive relief. While commentators have focused on the ineffectiveness of remedies, few have tried to answer why, on a theoretical level, those remedies are weak and ineffective. In Consequences of a Mismatch: Remedial Philosophy and Statutory Rights Under the National Labor Relations Act, Rita Trivedi tackles this question. She explains that NLRB remedies have been limited to contract-like make-whole remedies, which she calls ex-post relief, even though labor rights are not contractual rights but “something of value that [Congress] deemed worthy of protection,” which she calls ex-ante legal rights. (P. 25.)
To make her point, Trivedi breaks down her argument into five parts. She begins with the historical fact that NLRA remedies have been limited to make-whole relief, such as that used to remedy breach-of-contract claims, since the Supreme Court’s 1940 decision in Republic Steel Corporation v. NLRB. For example, the remedy for discriminatory discharge is backpay and reinstatement; however, backpay damages fail to deter most employers from violating the Act because wages are generally low. For the employer, it often pays to break the law.
In the next sections, Trivedi explains the difference between traditional ex-post (e.g., contract) and ex-ante (e.g., tort) relief and why ex-ante relief is appropriate to remedy labor violations. In part two, she explains that the three traditional remedial interests of contract law—expectation, reliance, and restitution—“reflect the lack of a value assigned to the parties’ ‘right’ to receive what they contracted for.” In part three, she explains ex-ante deterrence could play a role in more fully remedying labor rights because “ex-ante deterrence remedies send a societal message that the law values the rights that have been violated and is ready to direct compliance with social norms.” (P. 45.) She also draws on the philosophical underpinning of tort law and federal employment law to show how remedies could serve the deterrence function without necessarily being punitive. (Pp. 47–49.) In part four, Trivedi explains that using ex-ante deterrence in conjunction with ex-post relief is appropriate given that Congress created statutory rights, and therefore deterrence is necessary to protect the normative value of those legal rights.
In part five, Trivedi uses examples to show the most problematic aspects of taking only a make-whole approach to breaches of the NLRA’s statutory duties. (Pp. 56–62.) For example, Trivedi explains that nip-in-the-bud unfair labor practices are difficult to remedy with only ex-post relief because “‘[n]o other worker in his right mind would participate in a union campaign in [a] plant after having observed that other workers have been discharged and must wait for three years to have their rights vindicated.’” Nip-in-the-bud unfair labor practices are NLRA violations, such as firing union sympathizers during an organizing campaign, which are intended to discourage unionization as soon as it begins.
This article is well-written, well-organized, and cogently argued. Labor law is a highly specialized field that is subject to constant oscillation. Comparatively few lawyers are truly experts in this field, and even experts can barely keep up-to-date with the current state of the law. Moreover, labor law is highly interconnected, meaning that one doctrine affects many others, ideally forming a seamless tapestry. The problem is that every administration has an agenda, tugging at threads, and leaving gaps of disconnected doctrine. This article shows those connections and why the pattern they weave does not make complete sense at the remedial level.
This article is also particularly valuable to the legal academic because it not only explains the law at the doctrinal level but also analyzes doctrine from a philosophical point of view. It seems obvious, now that Trivedi points it out, that an unfair labor practice is a tort and that the courts have limited remedies to contract-like relief in a mismatch that affects substantive rights granted by Congress. Explaining it in this manner clarifies it for the novice and presents the expert with an “aha” moment: Trivedi provides justification for tort remedies.
This article is also timely. NLRB General Counsel Jennifer Abruzzo has directed the NLRB Regional Offices to “request from the Board the full panoply of remedies available to ensure that victims of unlawful conduct are made whole for losses suffered as a result of unfair labor practices.” She has also urged the Regional Offices to seek injunctive relief under Section 10(j) “to ensure that employees’ rights will be adequately protected from remedial failure due to the passage of time” and stated that “[d]uring [her] tenure as General Counsel, [she] intend[s] to aggressively seek Section 10(j) relief where necessary to preserve the status quo and the efficacy of final Board orders.” While she uses the ex-post “status quo” language of contract, she suggests something more—that what she wants to protect is worthy of protection in and of itself.
And Abruzzo has made good on those promises. For example, she asked for—and the Board granted—make-whole relief that “expressly order[s] [the employer] to compensate affected employees for all direct or foreseeable pecuniary harms that these employees suffer as a result of the [the employer’s] unfair labor practice.”
In short, Trivedi’s article is an easy read that is both educational and insightful. It clearly explains how remedies under the NLRA work (or fail to work) and provides both a philosophical and doctrinal justification for the current General Counsel’s agenda to remedy unfair labor practices to the fullest extent of the law.
Oct 31, 2023 Deepa Das Acevedo
Employee Retirement Income Security Act (ERISA) attorneys and scholars are an enthusiastic bunch. They love (love) talking all things benefits, whether this means arcane legislative history or the minutiae of healthcare plans. ERISA folk especially love their statute, even though almost everyone else considers it too dry and far too complex—and even though they themselves often affectionately poke at it with names like the Every Ridiculous Idea Since Adam law. (This was my own ERISA professor’s personal favorite.)
Occasionally, as with Brendan Maher’s recent article, Pro-Choice Plans, the reason for all this enthusiasm becomes eye-wateringly obvious. ERISA affects aspects of life that everyone cares about deeply: what happens when we get sick, and what happens when we get old. As Maher points out, this means it also—if indirectly—affects abortion access.
The first great virtue of Maher’s article is its mercifully clear and minutiae-free explanation of core ERISA concepts and elements. Walking non-ERISA folk through the workings of a statute that generates instant eye-glaze is, as I know all too well, no easy task. Maher accomplishes it with both brevity and nuance. You might even read the article as a primer on the statute itself, regardless of your interest in ERISA’s impact on abortion rights. It’s that accessible. You could certainly assign it to a classroom of exhausted and preoccupied law students. I plan to do so.
Of course, if you’re at all interested in reproductive rights, American politics, or law, you’re probably reading Pro-Choice Plans for what it has to say about abortion. That would also be an excellent choice, no pun intended, because what Maher says is both insightful and exciting without getting carried away by its own creativity. If you’re pro-choice and still weighed down by the long shadow of Dobbs, as I am, it offers a much-needed glimmer of possibility.
Maher’s argument is simple. Many people who seek abortions will do so via their healthcare plans, and most healthcare plans are subject to ERISA. How ERISA intersects with the myriad state laws limiting abortion access is thus self-evidently important. I should note here that, in the course of laying out his normative argument, Maher constructs a nice, four-fold categorization of state abortion laws that is keyed to ERISA but is also more broadly useful.
Two types of state laws, he writes, are unlikely to survive ERISA’s well-established preemption powers: “reporting” laws that force individuals to report pending or completed abortions, and “aiding and abetting” laws that prevent individuals or institutional actors from facilitating abortions. But, of course, there are four benefits-relevant types of state laws in his taxonomy. Maher acknowledges that the remaining two categories—“direct” laws that prohibit getting or providing abortions within state boundaries, and “insurance” laws that prohibit in-state insurers from covering abortion expenses within state boundaries—are trickier. In states that enact these latter two kinds of laws, ERISA doesn’t offer an easy path to continued access.
Even so, there may be options for employers who want to provide abortion coverage to their employees. Self-insured plans are quite likely to survive state prohibitions, assuming that the Supreme Court does not decide to upend decades of ERISA precedent. (Maher, to his credit, is appropriately cautious on this point.) But that only takes care of wealthy employers whose bank balances can support their ideological preferences. What about small employers who share an interest in providing abortion coverage but not at the expense of their own survival? Maher makes a few tantalizing observations about the use of stop-loss insurance coverage—and, yes, observations about insurance can be “tantalizing.” I would have loved to hear more of his thoughts on this front. Nevertheless, since we don’t have much precedent to go on, Maher’s circumspection is once again entirely warranted.
Read Pro-Choice Plans for its humane explanation of a complicated statute. Read it for a rare spot of hope in an otherwise disheartening time. Read it for a renewed appreciation of the ways legal solutions may not always come from obvious legal sources. But do read it.
Oct 3, 2023 Charles A. Sullivan
Camilla A. Hrdy & Christopher B. Seaman,
Beyond Trade Secrecy: Confidentiality Agreements That Act Like Noncompetes, 133
Yale L. J. __ (forthcoming 2023), available at
SSRN (Mar. 15, 2023).
Over the last decade or so, there have been remarkable developments in the law’s approach to employee noncompetition agreements (NCAs). After years of little movement, many states have recently restricted noncompetes (for example, by barring them entirely for lower-compensated workers), while a few jurisdictions (including Massachusetts, D.C., and Minnesota) have taken more dramatic steps to rein in their use. And further change may be in the offing, including the Uniform Law Commission’s (ULC) proposed Uniform Restrictive Employment Agreement Act, the Federal Trade Commission’s proposed rulemaking that would largely bar NCAs, and the National Labor Relations Board’s challenge to using noncompetes for covered workers.
But not everyone realizes that these changes may reach contract terms beyond those formally phrased in terms of restricting a worker’s post-employment competition. Indeed, both the ULC and the FTC actions would reach contracts framed as barring disclosure of confidential information when such an agreement has effects similar to those of a noncompete.
It is this possibility that drives Camilla A. Hrdy and Christopher B. Seaman’s article, Beyond Trade Secrecy: Confidentiality Agreements That Act Like Noncompetes. While others have recognized that limitations on disclosure can have effects similar to NCAs, the authors are the first to provide a comprehensive treatment of the question, one enriched by an empirical study that is the first to explore how confidentiality clauses are deployed in the real world.
As indicated by the title, the main concern of the Article is agreements that reach beyond “trade secrets” to protect a broader category of “confidential information.. That means that the narrow definition of trade secrets is inapplicable. Worse, while an employee’s general knowledge, skill, training and experience are excluded from trade secret protection, a confidentiality agreement may seek to restrict not only disclosure of such information but even its use when acquired during the course of the employee’s job. That means that such an agreement may parallel an NCA in terms of employee mobility and constraints on innovation and, indeed, may be worse because it is not subject to the temporal and spatial limits that control formal NCAs.
Although Hrdy and Seaman prefer the term “confidentiality” to “nondisclosure” agreements (NDAs) in order to capture the common bar of employee use, nondisclosure is frequently the label affixed to these contracts, and the authors’ central point is that NDAs may have similar or worse effects than NCAs.
This is problematic because confidentiality agreements, at least historically, were usually treated as presumptively valid and the “common wisdom” is that they were not subject to those pesky public policy constraints applicable to noncompetes. Thus, a former employee may be enjoined from using protected information even if the effect of such a possibility is to restrict employee mobility comparably to an NCA but without the law’s preconditions in that context.
In the course of surveying various judicial and statutory approaches to the problem, one of the main contributions of the Article is identifying current authority requiring greater scrutiny of confidentiality agreements that amount to “de facto noncompetes.” Even short of that, some courts, according to Hrdy and Seaman, apply a “more nuanced” analysis of the anticompetitive effects of such agreement. But even these decisions do not doctrinally treat subject agreements as noncompetes so that failures to impose temporal or geographic limitation are not fatal. Instead, “[c]ourts tend to assess the degree to which the confidentiality agreement reaches beyond trade secrecy and whether the agreement—regardless of what it is called—has the effect of a noncompete.”
Another contribution is the authors’ empirical study of some 450 confidentiality agreements that have become public, typically in the litigation context. Although the Article recognizes the selection bias associated with this data gathering strategy, they have done a scholarly service in shining a light on how such agreements operate in at least some of the real world. The authors conclude that employers typically use broad confidentiality agreements as a backstop for trade secret protection, and that, facially at least, such agreements are more restrictive than NCAs: “And, contrary to noncompetes, “they almost never have geographic or temporal limitations, and they are usually written to last forever.”
The normative takeaway from Hrdy and Seaman’s article is a default rule of unenforceability for confidentiality agreements that go beyond trade secrecy but subject to the employer’s showing that such agreements “are reasonably related to the goal of protecting legitimately confidential information and are not acting as de facto noncompetes.” They claim that the result will not be to outlaw confidentiality contracts but rather to “weed out poorly drafted confidentiality agreements that have the effect of perpetual noncompetes.” Among the requirements for validity would be employer proof that the confidentiality agreement does not restrict employees from using their general knowledge, skill, and experience. While neither a specific duration nor specific geographic reach would be needed for validity, the information protected by the agreement must still be secret when the employee seeks to use or disclose it and the agreement must not reach information that is “public or generally known to persons in the employer’s industry” or which the employee already possessed prior to the employment relationship, or obtained lawfully from third party sources or was required by law to be enforced.
The authors’ proposal would substantially reduce the legitimate scope of confidentiality agreements, but Hrdy and Seaman are not uniformly hostile to them. They recognize a need for protection of confidential information, even beyond information that would qualify as a trade secret. Further, they do not believe that employees should be free to use such information merely because it could be (but wasn’t) acquired legitimately.
There’s more than a little in the article to chew on, and we can expect challenges to the authors’ analysis as going both too far and not far enough. This is a Jot, so any detailed criticism would be out of place but I do note that the notion of a “de facto noncompete” could use some fleshing out. While it is by no means clear that the more sweeping current challenges to NCAs will be successful, Hrdy and Seaman are to be praised for their effort to ensure that any reconsideration deals not only with formal NCAs but also functional ones.
Cite as: Charles A. Sullivan,
Turning NDAs into NCAs, JOTWELL
(October 3, 2023) (reviewing Camilla A. Hrdy & Christopher B. Seaman,
Beyond Trade Secrecy: Confidentiality Agreements That Act Like Noncompetes, 133
Yale L. J. __ (forthcoming 2023), available at SSRN (Mar. 15, 2023)),
https://worklaw.jotwell.com/turning-ndas-into-ncas/.
