The Supreme Court’s epic gift to employers

June 13, 2018

Scot McCullough, a former employee of Epic Systems, explains why tech workers aren’t alone in being overworked — but they don’t have to be alone in fighting back either.

WORKERS HAVE even fewer ways to challenge their employer thanks to the latest anti-labor U.S. Supreme Court decision in Epic Systems Corp. v. Lewis, announced in late May.

With this 5-4 decision, the justices are letting employers force workers to sign individual arbitration agreements that waive the right to sue collectively. Instead of teaming up in a class-action lawsuit, each employee must attempt to enforce their rights alone, and through arbitration, not the courts.

Epic is a software company located in Verona, Wisconsin, a few miles down the road from Madison. It produces electronic medical records that are now used in hospitals and clinics in every state.

It’s well known for its sprawling campus, with quirky features like a slide, a Dungeons & Dragons-themed building and a giant rocking horse. The headquarters brings thousands of visitors to the Madison area each year, and Epic is celebrated for its impact on the local economy.

Epic Systems headquarters in Verona, Wisconsin
Epic Systems headquarters in Verona, Wisconsin (Ylem | Wikimedia Commons)

Epic is also notorious in Madison and surrounding communities for employee burnout and high turnover. Its approach is to rapidly hire new college graduates and grind them into dust with expectations of high productivity and long hours.

Epic employees work at least forty hours every week, and often much longer, depending on their role. But the majority of Epic employees are salaried, so none of the extra hours translate into extra pay.

IN APRIL 2014, Epic settled a lawsuit brought by 45 quality assurance employees who claimed they had been incorrectly misclassified under the Fair Labor Standards Act as exempt from the requirement of overtime pay. In the settlement, Epic paid out $5.4 million to just under 1,000 current and former employees.

Right around then, all Epic employees received an e-mail notifying them that they had two days to agree to an arbitration agreement. The e-mail read:

For about 6 months, we have been discussing the pros and cons of arbitration vs. litigation for employment related matters. The recent class action case filed against us, claiming that some of our salaried professionals should be re-classified as hourly employees, has convinced us that litigation is inefficient and wasteful, and highlights the advantages of arbitration...Please review and acknowledge your Agreement by clicking “Vote” and then selecting “I understand and agree” or if you’d like someone to contact you about it, please select “Contact me.”

The message projects a pretense of choice for employees — “click ‘Vote’!” — and also the absurd presumption of equal footing. It reminded me of the famous comment of poet Anatole France, who wrote in 1894, “In its majestic equality, the law forbids rich and poor alike to sleep under bridges, beg in the streets and steal loaves of bread.”

Similarly, the arbitration agreement that employees had two days to sign included lines such as “Both Epic and I are waiving the right to a trial before a judge or jury in federal or state court in favor of arbitration,” and “Both Epic and I waive the right to participate in or receive money or any other relief from any class, collective, or representative proceedings.”

In other words, employees or former employees can’t be part of a class-action lawsuit against this multibillion-dollar corporation — but neither can the multibillion-dollar corporation band together with other multibillion-dollar corporations to sue individual employees.

Total equality!

Within a few years, the agreement had proved effective in preventing workers from recovering lost wages. Two groups of technical writers challenged their misclassification and Epic’s failure to pay them overtime — one group had left Epic before employees were required to agree to arbitration, and the other had been forced into signing.

The former group reached a settlement in January 2017, but the second lawsuit became Epic v. Lewis, where the company won outright. Another more recent lawsuit filed by quality assurance workers on the same grounds as the writers is also likely to thrown out after the Supreme Court decision.

That decision will have reverberations far beyond Epic. In fact, Chipotle has already asked a judge to exclude 2,814 workers from a wage-theft lawsuit because they, too, signed an arbitration agreement.

Plus, Epic v. Lewis only reached the Supreme Court after similar lawsuits over arbitration agreements received different rulings at the district court level — the workers in those other cases are also unlikely to succeed in getting justice.

Filing a lawsuit against your employer as an individual is time-consuming and prohibitively expensive. Depending on the amount of wages one hopes to recover, the up-front cost is almost certainly insurmountable. In these circumstances, class-action lawsuits are often the only way for workers to take legal action to enforce their rights.

But after Epic v. Lewis, workers will find it increasingly difficult to win in a court-system that is already stacked against them.

FOR WORKERS at Epic in particular, this means finding new ways to challenge unjust treatment on the job — at a company seen by many as progressive and headed by a billionaire who is frequently regarded as a liberal darling.

Judy Faulkner, Epic’s founder and CEO, has an estimated net worth of $3.6 billion, making her one of the richest women in the country. In 2017, she was lauded for being America’s wealthiest “self-made” woman in tech. Here in Wisconsin, she’s celebrated as a zany philanthropist with an affinity for strange art and a corporate campus that looks more like a weird theme park than office space.

News coverage of Faulkner’s quirkiness and “generosity” almost always glosses over the darker side of Epic — the rampant employee turnover and burnout, and the heap of lawsuits for unpaid overtime.

But where did Faulkner’s obscene wealth really come from? Hidden behind the words “self-made” are nearly 10,000 employees, most of whom work more than 40 hours a week without additional compensation to produce Epic’s profits and Faulkner’s billions.

When she announced in 2015 that she would be giving most her riches to charity after her death, Faulkner’s company was embroiled in two overtime lawsuits. Yet none of the media coverage asked the pressing question: Why is that money hers to give away?

Faulkner is typically regarded as something of a liberal hero, or at least one of the “good” billionaires, in part because of the causes and Democratic candidates she has supported. She served on Barack Obama’s Health IT Policy Committee — and her company raked in the profits when the Obama administration paid out billions to hospitals and clinics to adopt electronic medical records, which Epic produces.

Faulkner is often contrasted with another Wisconsin woman billionaire, Diane Hendricks of ABC Supply. Hendricks is notorious in liberal Madison for bankrolling anti-labor Gov. Scott Walker, who was caught on video promising Hendricks that he would gut the power of unions — which is exactly what he set out to do when he took office in 2011.

But Epic’s victory in this disastrous Supreme Court case makes it clear that the distance between the two billionaires is actually quite slim. Both are anti-worker, and both should be held accountable for their attacks on workers’ rights.

EPIC EMPLOYEES — and tech workers more generally — are often mistakenly viewed as immune from workplace exploitation, as if a higher salary means the relationship with employers is different than for people who work in manufacturing, at restaurants or in schools.

But Epic v. Lewis dissolves the myth that tech workers are different than the workers in any other industry who will be impacted by this decision. If any more evidence is needed, remember that among the workers who originally contested mandatory arbitration agreements, technical writers at Epic were joined by pizza delivery drivers for Domino’s.

Epic won this legal battle, but the fight also highlights the only way forward for workers: together. Already, some people are making the case for a union at Epic.

Like workers around the world, the people working for Epic have a lot to fight for: recovering unpaid overtime; winning real maternity and paternity leave, instead of having to cobble together sick days and short-term disability; stopping a rollback of their benefits.

An example of this last grievance, while employees once received bonuses of up to $1,000 for earning additional software certifications, the popular program was ended several years ago when Epic told employees that they should focus on “doing good,” instead of just earning “a few dollars.”

Now, earning additional certifications is mandatory — something employees are expected to do in addition to their regular workload.

Epic employees deserve wages that reflect their actual hours worked. Slides, colorful sculptures and a Harry Potter-themed office building in which to work 60 hours a week is no substitute for money that workers would spend on their own personal needs, like childcare and housing.

The Supreme Court decision in Epic v. Lewis is a setback for workers all over the country. It will make it even more difficult for workers to seek justice through legal channels, whether over stolen wages or rampant sexual harassment or discrimination.

But the courts aren’t the end of the road for workers, and they aren’t the arena in which workers have the most power, in any case.

Workers from Epic to Chipotle to Dominos and around the country should recognize that while their workplaces might look different than the factory floors of a century ago or even the classrooms of frustrated teachers who walked out all over the country this spring, the exploitation and attacks they face aren’t new — and they aren’t alone in the need to stand up for justice.

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