These gestures are superficial responses to this moment. There are a number of things companies should do to address systemic racism in corporate America, but one thing most businesses must do is stop actively shielding themselves from accountability in court for race discrimination in their workplaces.
Existing laws prohibit race discrimination at work. Title VII of the 1964 Civil Rights Act, along with the laws of most states, makes it illegal for an employer to impose on black workers or black job applicants different terms and conditions of employment. This kind of discrimination can be subtle and unintentional, including double standards, pay disparities and glass ceilings, as well as hiring and recruiting only from historically white networks. And of course, discrimination can also take the form of hostility and abuse: from epithets such as “lazy” to the n-word and nooses. Retaliation at work is also illegal. If you complain about a racist culture and are then fired, demoted or pushed out, that’s also against the law.
Title VII and its state counterparts were meant to usher in a new era of tolerant and inclusive workplaces. But they are effectively toothless in the majority of U.S. corporations for one simple reason: forced arbitration.
Forced arbitration means that as a condition of hire, an employee must sign a document promising never to sue the employer in court for the company’s illegal actions — even in civil rights cases. Instead of going to court, the employee agrees to go only to an “arbitrator.”
Arbitration allows corporations to avoid being properly held accountable for violating anti-discrimination laws. In a lawsuit filed in court, anyone can access the court file and read the allegations of discrimination against an employer. Trials are open to the public. In arbitration, however, the allegations are secret, and trials are conducted out of public view and before an “arbitrator,” not a jury.
In court, the judge is a public employee, and a jury of nine to 12 people from the community — from diverse races, backgrounds and ages — decides the case. In arbitration, the arbitrator decides everything. The majority of arbitrators are lawyers or retired judges; almost all are older white men. These are the people who have the sole power to determine whether race discrimination happened or not. And they are paid by the company to make that decision and can get repeat business from the employers. Arbitrators can refuse to allow employees to take depositions, get documents and otherwise prove their case — something that does not happen in court. There is almost zero ability to appeal the decision. It’s no surprise, then, that plaintiffs lose more in arbitration than in court, and when they do win, they win less money. The bias against plaintiffs has been well-documented. And law professor Michael Z. Green long ago called out the integrity of a system that does not offer black claimants any real opportunity to adjudicate their claims before a person of color.
Arbitration eviscerates the powerful civil rights laws that were meant to end discrimination in the workplace. Just as various legal technicalities such as qualified immunity allow police officers to escape accountability for racist killings, arbitration allows employers to escape meaningful accountability for race discrimination their employees endure.
We hold out hope that change is possible. In response to the #MeToo movement, many corporations got rid of forced arbitration. Perhaps companies moved by the Black Lives Matter movement will get serious not just about decrying white supremacy but also about allowing themselves to be held fully accountable. Those that fail to do so will continue to benefit from structural inequities while simply paying lip service to a “trending” cause.