In October 2017, the New York Times published a massive and hard-hitting expose detailing decades of allegations of sexual harassment involving Harvey Weinstein. In the wake of the Times’ investigation of the high-powered film executive, a steady stream of additional allegations have emerged against other prominent public figures, including several well-established names in fashion. The accounts have ranged from details of sexual harassment and rape to specifics of the gross disparity in income between men and women that continue to plague workplaces in nearly every industry.
While instant condemnation or “trial by media” and the legal administration of justice make for strange – and at times, problematic – bedfellows, as former New York federal judge Shira Scheindlin outlined recently in an article for The Guardian, the new sense of openness and liberation in which these issues can be aired is a very good thing.
The result of the Times’ Weinstein investigation has led to a surge in awareness. For instance, the 75th Golden Globes, which took place earlier this month, were dominated by attendees wearing black in solidarity with the “Time’s Up” movement. Created by a number of A-list actresses, directors, agents and writers, the movement calls for an end to sexual assault, harassment and inequality in the workplace.
More powerful than black dress-covered red carpets is the fund that “Time’s Up” has created to subsidize legal support for those who have experienced sexual harassment and/or discrimination in the workplace. The existence of the fund to fight such wrongs is significant for several reasons, one of which is that it serves as an important reminder that there are, in fact, legal grounds upon which women (and men) can rely when subjected to an array of abuses in the workplace.
Despite such legislation and various court-made law, however – whether it is a statute that makes it illegal for men and women to be paid different wages for equal work, or the growing support for pending legislation which (if passed) would no longer permit companies to require arbitration as opposed to a class action lawsuit in connection with certain workplace disputes – the picture of gender relations in the workplace is not pretty.
Fashion is Great, Change is Better
As noted by London-based employment attorney Josie Beal, “Gender parity in the workplace is by no means an issue exclusive to Hollywood [or fashion]; it transcends geography, industry and sectors.” And this lack of equality exists in the face of laws in the United States and internationally.
In the U.S., for example, the first attempt at legally-mandating equal pay was initiated in 1944 when Congresswoman Winifred C. Stanley of Buffalo, N.Y. introduced the “Prohibiting Discrimination in Pay on Account of Sex” Act. Two decades later, in 1963, the U.S. government passed the Equal Pay Act. As part of the larger Fair Labor Standards Act, the Equal Pay Act prohibits wage discrimination by employers and labor organizations based solely on sex. In other words, employers may not legally pay men and women different wages for equal work on jobs that require equal skill, effort, and responsibility and are performed under similar working conditions.
The Equal Pay Act was swiftly followed by the passage of the Civil Rights Act in 1964, which, in Title VIII makes it unlawful to discriminate based on an individual’s race, religion, color, or sex. The Civil Rights Act expands upon the Equal Pay Act by not only making it illegal to pay men and women different monetary wages for the same jobs, but also prohibits the treatment of women in a discriminatory manner when it comes to other forms of compensation, as well as terms, conditions and/or privileges of employment, including promotions or wage increases.
Still yet, the National Labor Relations Act prohibits employers from preventing workers from talking about gender-inequity complaints at work or when they relate to work, including on social media.
Despite this legislation, as of April 2017, the national median annual pay for a woman with a full-time job was $40,742. The median annual pay for a man who holds a full-time job is $51,212. This means that, overall, women in the United States are paid 80 cents for every dollar paid to men, amounting to an annual gender wage gap of $10,470.
There are many reasons the gap is so difficult to close, according to Olivia Mitchell, the director of the pension research council at the Wharton School of Business at the University of Pennsylvania. Three of the most significant contributors, she says, “are the penalty women face for becoming mothers, women’s lack of negotiating skills and the bias women face from employers.”
So, despite federal laws requiring that men and women be paid the same for equal work, studies have shown that even when men and women of similar experience and educational backgrounds are working at the same company and have the same job title, women still make less.
A significant part of why sexual harassment continues to permeate workplaces is tied to how claims of wrongdoing are handled procedurally. No small number of companies require individuals, as a condition of their employment, to sign contracts that contain a mandatory arbitration clause, such a provision stipulates that the employee will be required to resolve a dispute with his/her employer, including charges of sexual harassment, through arbitration and thus, not before a court of law.
As a practice, arbitration differs, in part, from formal litigation in that its proceedings are private (meaning that third parties cannot attend arbitral conferences and hearings), and in some cases, are completely confidential, thereby obscuring information about the proceedings from the public.
More often than not, the participants in an in-house arbitration are forced to sign confidentiality agreements as a prerequisite to the settlement of the claims. One matter that comes to mind immediately is the $32 million settlement between Fox News’ top-rated host Bill O’Reilly and his fellow Fox co-worker Lis Wiehl. As reported by the New York Times in October, “O’Reilly secretly settled a sexual harassment allegation with [Wiehl] for $32 million — the largest, by far, of six such agreements that eventually toppled the outspoken commentator.”
The news broke after Fox News and its parent company 21st Century Fox “tried and ultimately failed to contain the second wave of a sexual harassment crisis that initially burst into public view the previous summer and, which cost the Fox News chairman, Roger Ailes, and eventually Mr. O’Reilly, their jobs.”
While 21st Century Fox acknowledged to the Times “that it was aware of [Wiehl’s] complaints about Mr. O’Reilly, which included allegations of repeated harassment, a nonconsensual sexual relationship and the sending of gay pornography and other sexually explicit material to her,” little more is known about the matter, as all parties were sworn to secrecy – legally – due to confidential nature of the settlement.
“Although the matter had been settled confidentially, Mr. O’Reilly’s lawyers were [particularly] concerned about keeping the dollar figure secret,” wrote the Times. While the $32 million settlement number made its way to the press, few other details of the arbitration were made public.
More is known about the sexual harassment lawsuit that former Fox News host Gretchen Carlson filed against Fox News chairman and CEO Roger Ailes in 2016. Like Wiehl, Carlson signed an employment contract containing a provision in which she agreed to resolve disputes with Fox News through private arbitration. This meant that “Carlson’s case could be thrown out [if she filed it in court] and Smith herself could be sued for millions for filing,” as noted by New York Magazine.
Carlson’s case was remarkable, of course, as she was able to take it to court, something an estimated 60 million Americans cannot do as a result of the widespread use of arbitration requirements. She was able to in front of a court by suing Ailes personally, rather than naming Fox News as a defendant.
The lawsuit ultimately led to Ailes’ resignation from the network (prior to his death in May 2017), and Carlson settled the suit for a reported $20 million in 2016. As noted by legal experts, the outcome could have been very different had Carlson simply abided by her mandatory arbitration clause. Instead, it empowered more women to come forward against their harassers.
More than two dozen women have come since forward to accuse Ailes of sexual harassment.
Class Action Waivers
Still yet, unlike lawsuits, which can be filed in a class action format – aka by a pool of different plaintiffs that have suffered the same harms from the same defendant(s) – many employment contracts include class action waivers.
A class action waiver contract provision entails a few different things: 1) It requires employees to agree to refrain from filing class action lawsuits; 2) it requires them to, instead, handle legal matters by way of arbitration; and 3) it requires employees to handle such matter via arbitration on an individual basis, i.e., not with other employees.
Companies that have class action waiver provisions in their employment contracts have argued that there are benefits to requiring employees to bring claims individually: “Claims are better settled on a case-by-case basis, thereby, resulting in quicker and more efficient decisions,” as noted by NPR.
The flipside, which has been argued by workers’ rights advocates, is that by requiring employees to make their cases in individual arbitrations, “the process often isolates workers from each other, when they most need the resources and information-sharing so crucial to establishing patterns of misconduct.”
Companies’ large-scale reliance on quiet arbitrations, including the usage of class action waivers (the legality of the latter is being decided by the Supreme Court as we speak), has enabled sexual harassment to become institutionalized in corporate culture, according to lawmakers and researchers, alike, so much so that in December 2017, Representatives Cheri Bustos (D-Ill), Walter Jones (R-N.C.) and Elise Stefanik (R-N.Y.) and Senators Kirsten Gillibrand (D-N.Y.), Kamala Harris (D-Calif.) and Lindsey Graham (R-S.C.) introduced a bill that, if passed, will serve to require employers and employees to litigate sexual harassment and discrimination claims in court, regardless of whether an arbitration agreement was signed.
Entitled, The Ending Forced Arbitration of Sexual Harassment Act of 2017, the bill came about in response to news in February 2017 that a number of women who worked at Jared and Kay Jewelers had tried to file a class-action lawsuit after senior executives allegedly had preyed on them, only to be forced into arbitration, says sponsoring Congresswoman Cheri Bustos.
“When they were hired, they filled out paperwork that took away their right to sue,” Ms. Bustos said. “They were forced into a secret arbitration process and that meant their stories would never see the light of day,” says Bustos.
Referring to the corporate culture of silence surrounding sexual harassment in the workplace, and specifically the “confidentiality agreements [that] serve to protect abusers,” Minna J. Kotkin, a professor of law at Brooklyn Law School who specializes in employment discrimination, wrote for the Washington Post last fall, “A secret about sexual harassment on the job is finally coming to light. It’s not that harassment is still rampant in some industries, recalling the worst of the ‘Mad Men’ days. Or that networks of women quietly help to protect their co-workers from the worst offenders. The real secret is that our regulatory and judicial systems are complicit in protecting harassers from public exposure and opprobrium.”
The Ending Forced Arbitration of Sexual Harassment Act of 2017, if passed, would serve to remedy some of these issues, including forced arbitration of sexual harassment claims. It would also make those matters inherently public, as dockets (the official summary of proceedings in a court of law) and their entries are in the public record.
But more than just that, Congresswoman Bustos says the bill is meant to send a strong message “to those CEOs and the managers that think that every day at the office ought to be like Mad Men.” The message: “Stop it and stop it now.”