Celine McNicholas

  • July 11, 2017
    Guest Post

    *This piece originally appeared on the Economic Policy Institute’s Working Economics Blog.

    by Celine McNicholas, Labor Counsel, Economic Policy Institute

    Yesterday, the Consumer Financial Protection Bureau (CFPB), an independent agency that serves as a watchdog for consumers, issued a rule that would ban companies from using mandatory arbitration clauses to deny Americans their day in court. The rule would restore consumers’ ability to band together in class-action suits. Without the ability to pool resources, many people are forced to abandon claims against financial institutions and other powerful companies. Consider that hundreds of millions of contracts for consumer financial products and services include mandatory arbitration clauses. Yet, The New York Times found that between 2010 and 2014, only 505 consumers went to arbitration over a dispute of $2,500 or less. By prohibiting class actions, companies have dramatically reduced consumer challenges to predatory practices.

    Mandatory arbitration clauses are also used by employers. Employees are forced give up their right to sue in court and accept private arbitration as their only remedy for violations of their legal rights. Private arbitration clauses tilt the system in the business’s favor: the company is often allowed to choose the arbitrator, who will thus be inclined to side with the business; arbitration also cannot be appealed, leaving workers and consumers in much worse shape than if they had access to the courts. As such, employees who bring grievances against their employers are much less likely to win in arbitration than in federal court. Employees in arbitration win only about a fifth of the time (21.4 percent), whereas they win more than a third (36.4 percent) of the time in federal courts.

  • June 19, 2017
    Guest Post

    *This piece originally appeared on the EPI blog.

    by Celine McNicholas, Labor Counsel, Economic Policy Institute


    Today, the Acting Solicitor General switched the government’s position in National Labor Relations Board v. Murphy Oil USA, Inc, from arguing in favor of working people to arguing in favor of big business. The move is deeply disappointing, and represents a stark departure from standard practice. It is the clearest indication yet of where the Trump administration stands: with corporate interests and against working people.

    The Murphy Oil case is significant for workers. It will determine whether mandatory arbitration agreements with individual workers that prevent them from pursuing work-related claims collectively are prohibited by the National Labor Relations Act (NLRA). These agreements have become increasingly common.

    The NLRA guarantees workers the right to join together to improve their terms and conditions of employment and prohibits employers from interfering with or restraining the exercise of these rights. In Murphy Oil, the National Labor Relations Board is arguing that agreements that force workers to waive their right to pursue work-related claims on a class or collective basis interfere with workers’ rights under the NLRA and are prohibited. The Solicitor General argued this position just last October, and there has been no change in the law since then. As a matter of fact, just last month the United States Court of Appeals for the Sixth Circuit held that these mandatory arbitration agreements and class action waivers are prohibited by the NLRA. The only thing that has changed is the administration.