Corporate Rhetoric, the Decline of Individual Rights, and What You Can Do About It

If you listened only to corporate-based rhetoric, you would get the following impressions about individuals who sue organizations:

• Frivolous lawsuits are out of control, and too many huge verdicts are being awarded to individuals who spill coffee on themselves and the like.
• There are too many individuals- including employees, consumers, injured persons and attorneys- who are “extortionists,” and are filing frivolous lawsuits to look for a quick (and large) buck.
• “Tort reform,” and restricting individuals’ access to the legal system, is needed, or else businesses may not financially survive.

As someone who works with individuals bringing legal claims, I see many problems with these concepts, which mischaracterize the state of the world as I experience it.

First, those promoting these concepts rarely point to statistics or empirical data to back their points up.  Rather, they usually point to a few unusual, outlier cases-for example, the McDonalds coffee-spill lawsuit- that do not represent the vast majority of litigation. (Incidentally, many may not view the coffee-spill lawsuit as frivolous or wrong if they knew more facts about the lawsuit: for example, the under-reported facts that the customer-Plaintiff in that case suffered extensive third-degree burns to her labia, inner thighs, and buttocks that required skin grafts).

The reality is, the vast majority of individual litigants do not litigate frivolous claims, much less obtain huge or unreasonable verdicts. Most individuals with disputes against organizations never file a lawsuit in the first place. Think of your own experience: have you lost money (totaling hundreds of dollars or more) because insurers, phone companies or other organizations made mistakes or decisions you felt were clearly wrong?  I would be surprised if any individual said this has never happened.

Yet most organizations are not challenged for most of the actions that adversely affect individuals.

The rhetorical concepts above assume there is no “extortion” or bad-faith behavior on the other end of the stick. That is, to say “tort reform” is needed is also to make the weighty assumption that most corporations are passive victims, and did little or nothing wrong to warrant the litigation they face. This is dubious. Human nature being what it is, there are likely similar percentages of wrongdoing on both sides of any fence. It is always a bad idea to over-generalize about one group of people or another.

On this point, I have heard some employees’ attorneys (colleagues) refer to employers and their attorneys as “the dark side.” The legal world has no more place for this stereotype than it does for the “extortionist” label to be attached to individual litigants. Any time one group (e.g. employers or employees) makes a sweeping generalization about another (e.g. the other side is inherently corrupt or commits litigation abuses), such claims deserve a healthy dose of skepticism, rather than blind buy-in.

Another problem with the rhetorical concepts above is the solution being proposed to fix the problems. The solution offered is this: individuals’ access to the legal system should be cut off. This solution is does not fit the alleged problems.

Assume for a moment that the concepts above of “tort reform” and the like were backed with empirical facts, and there were a demonstrated epidemic where a disproportionate number of individuals took baseless legal positions as compared to organizations. If that were the case, then appropriate solutions for that problem would be to: (1) increase laws and penalties for frivolous claims, and courts’ enforcement of the same; and (2) patch up any substantive laws that are being exploited by individuals.

These solutions would be tailored to fit the alleged problem of an increase in baseless claims. However, these are not the solutions of choice being offered by those pushing the “tort reform” rhetoric.

The most common solution proposed, rather, is to strip individuals’ rights to even be heard in a legal forum, or to even put their evidence on the table for evaluation by a judge or jury.

It is highly problematic-and suspect-that this drastic solution is the antidote of choice for the supposed abuses by individuals. Restriction of legal access and stifles the rights of all individuals: those who are wrong and those who are right.

Restricting access also cuts off individuals from the tools that our country has long used to ensure fairness: the right to present evidence to an impartial jury, the right to conduct discovery (i.e. require the opponent to turn over documentation, and give sworn testimony answering to relevant issues), the right to call witnesses on one’s behalf, and other fundamental rights.

In other words, the solution being proposed is not to cure the substance of individuals’ claims, or their supposed lack of merit. Rather, the solution is geared to withhold fundamental rights of fairness, such as the right to a jury trial.

At the same time these rights are attacked, power is being shifted to organizations. In many instances, legal-decision-making is being shifted from the province of judge and jury to that of private organizations and their contractors. It is important that these shifts are given just as much air time as the supposed epidemic of individuals capitalizing on meritless claims.

This massive shifting of rights and power is occurring under the guise of “tort reform,” individual “extortionists” and similar rhetoric. In my experience as an individuals’ legal representative, such rhetoric is a far cry from reality.

The Real-World Obstacles for Individuals in Employment Litigation and Elsewhere

As an employee rights attorney, my job involves helping employees work through legal disputes with their employers.

It is my observation that an individual who pursues a legal claim-whether in the role of an employee, a consumer, or an injured party- has disadvantages because the opponent is an organization.

As a first matter, most organizations have more money and resources than do most individuals. Most employers and corporations can afford a longer trip through the legal system than can most individuals.

Additionally, and of far greater concern, there is a huge and worrisome erosion of individual rights taking place in our country. Under our noses, individuals’ rights are being compromised in the following ways:

• Access to the legal system is being cut off for many classes of individuals, in many different areas of law.

Everyone has heard of issues with Guantanamo Bay prisoners, “unlawful combatants” and others being denied legal process, and the right to a day in court to answer the charges against them. However, many people are not aware that Guantanamo Bay is part of a larger, even more disturbing picture, in which individuals’ access to the legal system is compromised in many areas of law.

For example, in the civil litigation context, recent federal legislation and legal decisions have made it harder for employees and consumers to bring class action lawsuits. Nowadays, a corporation faces much less risk if it decides to defraud one million people for $5 each (earning $5 million), because the defrauded persons have a harder time banding together, and addressing the problem the only way (as a class) that can be effective and affordable.

Federal courts are upholding an increasing number of mandatory arbitration agreements. These agreements-which are often buried within take-it-or-leave-it employment or consumer agreements-cut off individuals’ access to courts and jury trials.  Many of these agreements force individuals to bring their legal disputes before an arbitrator who is hand-selected (and hired) by their corporate opponent.

Another erosion of individual rights is occurring in the federal courts, in the context of employment litigation. Federal courts are increasingly dismissing individuals’ cases on summary judgment (i.e. dismissed before a jury trial occurs). The law says cases should only be dismissed on summary judgment when there is a lack of genuine, material disputes between the parties. The courts have backed away from this required legal standard, and at increasing rates are dismissing genuinely-contestable cases in favor of organizations. This approach, as with all the others above, denies individual litigants’ right to a jury trial.

• There has been a steady, and substantial, decline in unions and organized labor representation.

According to the U.S. Department of Labor, in the year 2006, 12.0 percent of employed wage and salary workers were union members. This is a decrease from down from 12.5 percent in the year 2005. Setting aside government workers (who have far higher rates of unionization), only 7.4 percent of private industry workers were unionized in 2006.

This continues a long-standing, significant decline since the year 1983, when U.S. union membership rate was 20.1 percent.

As a result of this decline, several related individual rights are also declining. This includes the loss of the following types of advantages that unions (through their higher, collective bargaining power) usually obtain for employees: (1) the right to keep one’s job unless there is “cause” or performance-based reason for termination; (2) higher pay and better benefits; (3) the loss of union stewards and attorneys to represent workers and advocate for their interests.

•  Substantive law that protects individuals is drafted to be weak, or is weakened by court decisions.

Many of the laws that protect individuals are drafted with glaring weaknesses, or are weakened by court decisions.

For example, the federal Family and Medical Leave Act (FMLA) legislation was drafted for the purpose of helping individuals take medical leave, maternity leave, or paternity leave without being fired by their employers. However, U.S. FMLA law was drafted to be weaker than equivalent laws in almost every other country. For instance, under the FMLA, only workers who have worked for an employer for a year or more qualify for FMLA leave and protections. It is perfectly legal for a 3-month employee to be fired for taking two days of paternity leave, as happened to a worker who recently called me. Another weakness of the FMLA is that, for qualifying workers, the maximum leave time is only 12 weeks per year. Most countries in the world offer more leave time than this, with some offering up to 1 year of leave.

The FMLA’s lack of teeth for individuals translates to advantages for organizations. Organizations save money by not having to offer newer (less than 1-year) employees any FMLA leave, and by having a maximum leave time of only 12 weeks. Companies claim these (weak) conditions are costly enough, but the claims are dubious. Most other countries (and the companies therein) have found ways to make longer leaves work, and to extend stronger rights to individuals and their families.

Another problem with individual rights laws in the U.S. is that the courts have reduced the laws’ teeth. A good example of this is the Americans with Disabilities Act (ADA). The U.S. Supreme Court and other federal courts have made decision after decision that narrow and narrow what type of medical condition qualifies as a “disability.”

For instance, under court decisions it is not enough for an employee to simply prove he has diabetes and was fired because he had diabetes. The employee must spend a great deal of litigation expense and time trying to prove, often unsuccessfully, that his diabetes limits his life activities to an extent great enough to appease the courts’ definition of “disability.” In other words, the diabetic employee has to prove he was “disabled enough” to justify application of the ADA, and disabled enough to make a diabetes-based termination unlawful. If the employee made diligent efforts to control his diabetes (through diet, exercise, etc.), these efforts make a finding of discrimination less likely. From a legal perspective, he would be better off had he skipped his insulin shots.

• The corporate fox is being allowed to stand guard over the individuals’ henhouse in major areas of public policy (including issues of health, benefits, and employment).

In several important areas of public policy, the law caters to large organizations and lets them make important legal interpretations and/or decisions that affect individuals.

For example, under Employee Retirement Income Security Act (ERISA)-a federal law which governs employer-funded pension, health care and disability insurance plans-the employer’s insurance administrator (hired by the employer) is allowed to make initial decisions to grant or deny employees’ benefits. The administrator is also allowed to decide whether appeals of the initial decisions should be granted or denied. In other words, when an employee seeks critical monies to pay medical bills and/or survival benefits, during the initial decision, and during the several months of appeal time thereafter, the fox (the insurance administrator hired by the employer to serve the employer’s interests) is placed in charge of the henhouse (the employees’ claims seeking money from the employer). When benefits are denied, this saves the employer money, thus there is a profit motive for the employer and administrator to have claims denied.

Not surprisingly, many contestable determinations are made in the employer’s favor, and many employees are dissatisfied with what they see as a biased process. Unfortunately, employees have limited options after the employer-friendly claims procedures are exhausted. An employee can sue the employer and administrator in federal court, to try to obtain the health or disability benefits that were denied. However, most employees cannot afford to litigate these claims, as a threshold matter. Further, there is legal disincentive to litigate, because damages under ERISA are limited.  Also problematic is that fact that federal court precedent has more often than not construed ERISA in favor of organizations, and the individuals are usually the losers, even in cases that appear on their face to be highly unfair.

Another example of employers being allowed to self-police can be found under the Health Care Quality Improvement Act of 1986 (“HCQIA”). HCQIA allows hospitals and other large health organizations to fire physicians for unlawful reasons (e.g. because the doctor blew the whistle on unsafe practices or substandard care), and to have legal immunityfor their unlawful decision. The employer’s immunity is presumed. Thus, the fired doctor has the burden of defeating the immunity before he or she can obtain damages for the unlawful termination. Defeating immunity is extremely difficult. HCQIA law allows an employer hospital to be proven wrong- and in fact, proven to have violated employment or contractual law-and still retain immunity. Under HCQIA, to keep its immunity, the hospital need only show it conducted a few barebones procedures, which require little more than allowing the physician to be heard (often by a kangaroo court comprised of adversaries).

Given these realities that I witness individuals try to work through, it is hard to stomach the rhetoric that organizations propagate about individuals having it too good. Arguably, individual litigants in the U.S. have never had it worse.

The Reality of Individuals and Legal Claims, From the Perspective of an Employees’ Attorney

The rhetoric about “tort reform” being needed, and about a high rate of individuals being “extortionists,” couldn’t be further from the truth as compared to what I observe in my legal practice. Most individuals who have potential legal claims do not pursue legal action.

Of the potential clients/individuals who call me for an initial phone consultation, I discourage over half from filing a legal claim or paying any money toward legal fees.  Of the remaining persons, I encourage many to wait some time to see how their job search goes (and how much in financial losses they incur) and call me back later: if they call back later and have not incurred much in financial losses, a legal claim is usually not worth their while and I tell them so.

The most common reason for discouraging people is that legal action is not worth their investment. Sometimes, this is because there is no viable legal claim-the caller thinks that something unlawful may have occurred, but in my legal evaluation I find the opposing organization did not break the law.

When I tell such individuals that their opponent employer did not violate the law, the vast, vast majority of these individuals accept this news.  They do not want to sue their employer (despite their feelings the employer was unfair) if the law does not provide for a legal claim.

It is also common for an individual to call me, and that person does have a potentially viable legal claim, but there is a comparatively small amount of damages (money) and non-financial remedies that could be awarded if he or she won that claim.

For example, if an employee was fired and filed a complaint for disability discrimination under the Wisconsin Fair Employment Act, the most significant type of damages available to that employee is lost wages and benefits (also called “back pay”). If a fired employee is quick to find a new job-say it takes her only a month to pick up a job that pays the same as she made before-this employee’s main remedy (back pay) is limited to the value of only one month’s pay. Thus, under Wisconsin discrimination law, an employee’s diligence actually depletes the value of her legal claim. An employer can discriminate to the nth degree, and its liability can be relieved by the employee’s job-hunting diligence.

Given the nature of Wisconsin discrimination law, even if employees have air-tight, “smoking gun” evidence of discrimination (say, a videotape of managers admitting they fire employees because of disability or race), in many instances the damages would still be too small to warrant pursuing and investing in a legal claim. Accordingly, people who call me with good potential claims of discrimination, but with low potential damages, are usually discouraged from pursing legal action. This is because they would likely spend more money in fees and costs than they could recover if they won.

Of course, other individuals who call me with potential legal claims do have significant amounts of lost back pay or other legal damages at issue. For example, a fired employee who takes a year to find a comparable job, may lose tens of thousands of dollars (in some cases, hundreds of thousands). For such an employee, assuming he or she also has a viable legal claim, then the legal fees are worth investing toward the chance to obtain the (much larger) potential damages available.

However, just because a potential legal claim is worth the investment, does not mean that individuals will make the investment. Many individuals decide not to pursue viable, high-damages legal claims because they simply do not have money to pay legal fees.  And there are some who could pay, but do not want to take on any risk, or otherwise do not want to go through with it.

The bottom line is that in my experience working with individuals, and in my observations of other employee rights attorneys’ practices: (1) most individuals with potentially viable legal claims do not pursue those claims; and (2) of those individuals who do go forward with legal action, nearly all have viable claims with evidence to present in their favor, and have made a commitment and investment (of finances, time, and work) in their claims.  Of course, employers claim that almost every claim they face lacks merit or is frivolous.  But when it comes down to it, employers file very few motions challenging claims as frivolous.  Deep down, employers’ attorneys recognize that most employee claims have at least some material facts in their favor (just as employers’ defenses usually have at least some material facts in their favor).  The corporate advocates do not truly believe that all the rhetoric about runaway “frivolousness,” “extortion” and the like matches reality.  Rather, they understand that spreading generalizations about runaway frivolousness is a very effective public relations ploy.  The general populace does not have time to visit myriad corporate work environments, or visit myriad courtrooms, and take the time to observe and understand the empirical realities of the world, and what is really going on.  It is much easier to understand buzzwords like “extortion” and “tort reform” and the like.  And unfortunately, the human mind is inclined to believe the simplifications and buzzwords that are repeated the most, rather than reject buzzwords for what they are: buzzwords.  All this “tort reform” and “dark side” sloganing should trip one’s B.S. meter, and trigger skepticism and demand for empirical facts, but unfortunately that is typically not the case, and we accept the buzzwords as reality.  The empty axioms shouted back and forth.  “The early bird catches the worm!”  “No- haste makes waste!”  “Corporations are evil!”  “No- employees are extortionists!”

In my practice, it is rare- I would say, fewer than 1 in 100 prospective clients who calls me- for me to encounter an individual who has no claim and is looking for a windfall: that is, someone who could remotely or fairly be called an “extortionist.”  The vast majority of individuals who call me do not have extortion-type tendencies.

While there are no doubt some individuals out there with meritless claims who view the legal system as a meal ticket, the financial realities of litigation weed out the vast majority of such would-be extortionists. Most would-be extortionists are not willing to pay the fees and costs it would take to advance their legal claims. Further, most attorneys (even amoral ones) do not want to be associated with extortionists or bad legal claims offering little chance of victory, and weed out those prospective clients accordingly.

In my world-the real world representation of individuals-organizations are at an advantage. One big advantage, the advantage of financial disparity, may be impossible to change. However, individuals do have the ability to address the alarming decline of individual rights, and to fix such problems, both individual and societal.

What Individuals Can Do for Their Own Matters

For those individuals who have been wronged by organizations, and who have suffered financial loss, there are still plenty of things you can do to pursue relief.

First of all, you should seek advice about your legal matters, and make diligent efforts to find the right legal representative. Many attorneys will offer free initial phone consultations. Do not give up if the first attorney you call recommends you not proceed, or if you do not have enough money for that attorney’s services. Many attorneys (including me) offer reduced or contingency fee arrangements. Also, there are various free or low-cost legal resources who serve qualifying individuals with financial difficulties. You can find a list of such services at http://www.wisbar.org/AM/Template.cfm?Section=ProBono#resources.

As a second matter, after you find a legal representative, you should be prepared to make an investment. You should expect to invest time, work, and/or finances to correct the wrongs done to you. Know that the more financial loss you suffered based on what the opponent organization did (e.g. the greater the lost wages or medical bills, etc.), the more worthwhile it is for you to make a financial investment in your matter. If you feel something very unfair has been done to you, but there was little financial harm, you should still have your matter evaluated, but be weary of making a big financial investment unless it is clear to you that if you won your matter you would receive a reasonable return on that investment.

What You Can Do for Other Individuals’ Rights

If you are not individually-affected by organizations’ actions, but wish to address the societal problems above, there are several steps you can take to level the playing field between individuals and organizations.

You can voice your support to politicians who are seeking to implement legislation that fights organizations’ attacks of rights, as described above.

For example, there is a new legislative proposal to increase damages available under Wisconsin’s discrimination laws, and fix some of the problems referenced above.

The bill is described at http://www.legis.state.wi.us/2007/data/SB-165.pdf.

This legislation would make compensatory and punitive damages available to individuals who prevail on discrimination claims. The increased damages would lessen the blow to employees whose legal claims are presently devaluated by their job-search diligence. By increasing potential damages, the litigation would level the playing field, and provide employers with more incentive to avoid discrimination, and to seek reasonable resolutions with individuals who were terminated for discriminatory reasons.

You can find your state representative(s) contact information at the following websites, http://www.cwac.net/wirepsemail.html and
http://www.cwac.net/wisenemail.html#h and contact them to express support for the bill.

There is also legislation being proposed in the federal arena that addresses problems with individual rights as described above.

Senator Russ Feingold has proposed legislation, The Arbitration Fairness Act of 2007 (http://feingold.senate.gov/~feingold/issues_arbitration.html), that would help individuals by requiring that arbitration agreements only be made after a dispute has arisen. In other words, organizations would be prevented from making individuals sign take-it-or-leave-it arbitration agreements as a term of being hired for a job, or buying a product or service. Only if a dispute arises and both parties wanted to sign an arbitration agreement, would such an agreement be enforceable. This arrangement is fairer for individuals, and lessens organizations’ ability to abuse their greater bargaining power.

Congressman Jim Sensenbrenner, Jr. has cosponsored legislation that aims to fix problems with courts narrowing the protections of the ADA. More information about this legislation, called the ADA Restoration Act, can be found at http://sensenbrenner.house.gov/News/DocumentSingle.aspx?DocumentID=70169.

You can contact Senator Feingold at http://feingold.senate.gov/contact_opinion.html, and Senator Herb Kohl at http://kohl.senate.gov/gen_contact.html, to express support of the legislation above. You can also contact your congressional representative, by finding her or his contact information at http://www.house.gov/writerep/.

You must take action-by contacting your representatives or otherwise-to improve the lives of individuals, and make our country a fairer place for all. Avoid apathy, and do not accept at face value rhetoric from any camp.

Organizational representatives should also join the fight against other organizations and government entities who diminish individuals’ rights and access to the legal system. I have represented several executives and professionals who were once part of managerial decision-making bodies, only to find themselves cast aside by the same harsh policies they once had to endorse.

It is inevitable that every individual will need assistance some day. One out of five individuals has a disability. Every one of us becomes older.  As such, we all become more susceptible to employer decisions based on age, health insurance costs, or other discriminatory motives.

We should all fight to have core principles of fairness-such as access to a court and jury, and to the right to have our concerns heard-applied to everyone equally.