The Big Short in the Federal Courts

I recently saw an unsettling movie, The Big Short, about the blatant fraud and corruption on Wall Street  that led to the  global economic collapse and the.Great Recession.

Like many film goers, I felt deeply troubled about the Titanic-sized failure of the American government to protect ordinary Americans from predatory behavior and  criminality by Wall Street bankers and brokers.  But later my thoughts turned to another failure that  is currently being ignored by American government and the press, one that I see as an attorney who writes about  the law and workers who are victims of abuse and discrimination in employment.

There has been undisputed and powerful evidence for years that the federal court system, like America’s  financial system, operates to benefit powerful moneyed interests at the expense of ordinary American workers.  A major indicator of this trend is that federal courts routinely dismiss employment discrimination lawsuits at a far higher rate than other types of business lawsuits.

My book, Betrayed: The Legalization of Age Discrimination in the Workplace, painstakingly documents how the U.S. Congress and  Supreme Court have made it inordinately difficult for workers to prevail in an age discrimination lawsuit.  The Age Discrimination in Employment Act of 1967 ia weak and riddled with loopholes compared to Title VII of the Civil Rights Act of 1964, which prohibits discrimination on the basis of race, sex, religion, national origin and color. The U.S. Supreme Court issued a completely unnecessary ruling in 2009 requiring that age discrimination victims  prove a far higher level of causation than is required under Title VII.  A proposed federal law that would fix the Court’s disastrous ruling has languished in a Congressional committee for six years.  Congress and the Court have legalized discrimination in employment based on age that would be illegal if the victim wore a hijab or hailed from Zimbabwe or Yemen.

At one point last spring, I attempted to contact the Judicial Conference of the United States, a 16-member body (with no citizen representative) that ostensibly runs the federal court system. I wanted to point out that discriminating against employment discrimination victims is tantamount to actual discrimination. I found the Conference’s web site but it contained no contact information. A spokesperson for the Administrative Office of the U.S. Courts (AOC)  suggested that I send my correspondence to the federal circuit court in my jurisdiction, which has a seat on the Conference body.  In exasperation, I submitted  an “open letter” to whom it might concern requesting legal reform via a web form on the AOC web site. I have concluded, rightly or wrongly, that the “leadership” of our federal court system is unapproachable.

In the movie, The Big Short, some savvy observers figured out the housing market was about to collapse and they found a way to make money on the collapse.  It seems likely to me that one day the “bubble” surrounding the federal court system will burst.  Just as there was almost universal faith in the housing market, Americans historically  have shown a high degree of trust in the courts.  That trust is eroded every time the court permits  unscrupulous employers to use the legal system to deny workers respect, dignity and fundamental fairness.

Trust is lost when courts permit employers to use the legal system as a weapon against American workers.

Meanwhile,  President Barack Obama  encouraged age discrimination in hiring when he signed an executive order in 2010 that permits federal agencies to bypass older workers and hire “recent” graduates and  U.S. Labor Secretary Thomas Perez earlier this year endorsed a private initiative by America’s largest corporations that openly discriminates against older workers. The federal government is the nation’s largest employer.

All of this  is happening in plain sight but it has gone largely unreported by the tattered shreds of what remains of America’s once vigorous media.  (I may sound a bit cynical on this score because the 18th richest man in the world, Sheldon Adelson,  a casino operator and major Republican donor who owns a free newspaper in Israel, recently secretly purchased  Nevada’s largest newspaper and immediately began testing the limits of journalism ethics.)

Like the housing market bubble, the bubble in the federal court system is attributable in large part to inattention, neglect and failure of accountability. [Read more…]

The DOL Addresses ‘White Collar’ Slavery

*The Dept. of Labor issued the final rule on May 19, 2016. The DOL  more than doubled the salary threshold for eligibility for overtime for full-time salaried workers — lifting it from $23,660 to $47,476 per year. That means some 35 percent of full-time salaried workers, based on their pay, will now be eligible for overtime. PGB

The Fair Labor Standards Act, 29 CFR Part 541, makes it possible for employers to impose a kind of slavery on poorly-paid salaried employees who are exempt from the protections of the act because they are classified as “white collar” workers.

However, the U.S. Department of Labor this week released proposed amendments to the FLSA  “white collar” exemption provision that would, if adopted, eventually eliminate the exempt status of an estimated  21.4  million so-called “white collar” employees.

The FLSA exemption now applies to employees whose job duties primarily involve executive, administrative, or professional duties and who  earn a salary of at least $455 per week or $23,660 a year.  The DOL’s proposed regulations dramatically increase the minimum salary threshold for exempt status workers to $970 per week or $50,440 per year. This represents the 40th percentile of earnings for all full-time salaried workers throughout the United States.

Low-level white collar workers are ripe for exploitation, especially during difficult economic times when jobs are scarce.  During the Great Recession, many employers forced poorly-paid white collar workers to work endless or erratic unpaid overtime hours  to compensate for lay-offs or short staffing.  This caused predictable stress and burnout, with all of the attendant problems for individuals and families.  The “white collar” exemption is particularly brutal for single parents (mostly women) who must schedule and pay for child care.

The DOL has not updated the “white collar” salary level since 2004.  To prevent the proposed new salary level from becoming outdated, the DOL’s proposes  automatically updating the salary level each year to reflect the applicable 40th  percentile of earnings.  [Read more…]