OC Register Shines a Spotlight on Forced Arbitration

What would you do if your boss told you that either you sign away your rights or you won’t get your holiday bonus? That was the dilemma facing Steve Hamil, who worked as a machinist at a Southern California surgical device company.

Hamil’s story was detailed in Sunday’s Orange County Register:

Applied Medical Resources sent a letter to its 3,000-plus employees saying that the bonuses, which the company regularly gives to workers at all levels, would depend on their signing a release waiving any claim to sue the company over workplace issues.

Any claims, whether for unpaid wages and missed rest breaks or racial, gender and other types of discrimination, would go to private arbitration, the release stipulated.

“Hosed for the holidays – a Christmas bonus in exchange for giving up our rights,” said Hamil, who signed the agreement but since has moved to another company. “People were upset – it was insulting.”

Hamil was victim to a growing practice called forced arbitration, in which bosses are mandating that workers sign away their rights to sue the company or file a complaint with the state’s Labor Commissioner if they are cheated out of wages, sexually harassed or experience a host of other abuses on the job.

Gov. Jerry Brown now has the opportunity to curtail this abusive practice, by signing AB 465 (Hernandez).

From the Register:

Caitlin Vega, the labor federation’s legislative counsel, insists that the new law “is not a ban on arbitration agreements – so long as they are voluntary. Employers who want them can explain why they are beneficial, and most workers may agree.”

Arbitration, she said, “Works between parties of relatively equal bargaining power, such as between businesses, or between unions and management. But it is unfair when one party is required to sign an agreement just to get a job.”

More and more, she adds, “These agreements are routinely required of low-wage immigrant workers, especially in industries with widespread labor abuses.”

AB 465 proponents say that arbitrators often favor corporate clients because dispute resolution companies want to be hired again.

No one should be forced to sign away their rights as a condition of employment or to receive pay they’ve earned. We urge Gov. Brown to protect workers by signing AB 465 into law.