How Expanding the Right to Contract Can Limit Rights
The right to give up your rights is barely a right at all.
You are bleeding to death. You call an ambulance. The ambulance takes you to the nearest hospital and you are rushed into the emergency room. Before the hospital will treat you, they ask you to sign a form. In four-point type at the bottom is a small notice: “By agreeing to be treated here you agree that nothing done by this hospital can ever legally constitute malpractice, and you agree to waive any and all legal claims you might otherwise have against this facility.” (That’s a paraphrase; the actual explanation is 10 single-spaced paragraphs in thick legalese.) Because you do not wish to bleed to death, or simply because you are a normal person who can’t read 10 paragraphs of four-point type, you sign. The hospital places you under an anesthetic. When you awake, you discover that your wound has been patched up. Unfortunately, you also notice that your arms, legs, and nose have been removed. When you ask the doctor why this was necessary, he says with a snarl: “Necessary? NECESSARY?! Of course it wasn’t necessary. I simply find the human body disgusting. I have made you beautiful. And you dare to be ungrateful!” He laughs maniacally and spits at you. You realize you are in the presence of a madman.
Now, hopefully it’s the case that when word leaks of this physician’s barbarity, there will be both professional and criminal consequences. He will, in a functional system, have his medical license taken from him and be sent to prison. However, this still leaves civil law. What about you? Can you sue him for malpractice and receive compensation? Well, that will depend entirely on how a court chooses to interpret the contract you signed. If the court says “This contract is clearly invalid since you did not meaningfully consent to what happened” your lawsuit can go ahead. But perhaps your judge is a libertarian. In that case, the ruling might be “Sucks for you, that’s what you signed up for.” (Sucks for you is practically libertarianism’s founding motto.)
I give this extreme hypothetical because, as my colleagues Sparky Abraham and Oren Nimni recently explained, the Supreme Court recently handed down an important ruling on worker rights, upholding the right of companies to enforce contracts prohibiting workers from engaging in class action lawsuits when the companies break the law. In other words, your ability to sue your employer if they hurt you isn’t an absolute. It can be “contracted away.” Many on the left, including myself along with Nimni and Abraham, see this as a violation of workers’ rights, because it ends up taking their ability to sue over things like wage theft and harassment.
But there is a conservative argument that our objection is completely topsy-turvy, and that saying these kinds of court decisions will limit workers’ rights is the opposite of the truth. As Andrew Grossman of the Cato Institute said:
Epic Systems didn’t “limit workers’ rights.” Literally, it expands them: if it came out the other way, workers would be denied right to agree to arbitration of claims. Likewise, if Janus goes for petitioner, workers gain right not to fund union.
Grossman says that a court that allows these types of contracts hasn’t abridged a right. How could it have? It has given people more rights: Previously, workers did not have the right to sign this particular type of contract, now they do have the right. It adds to the number of possible contractual arrangements. More freedom, more rights. Right?
But this is a thoughtless response, one that doesn’t take seriously the left-wing argument. It’s true that the court itself hasn’t eliminated a particular right. But it’s also true that the result of the court’s decision is that many workers will lose an important right, namely the right to sue their employer for wrongdoing in a court of law. Consider our hospital parallel. The libertarian judge may say that he has expanded your rights. If he had ruled that this type of contract was impermissible, he would have limited the permissible range of contracts. But his decision also results in you losing your right to sue. As you sit there noseless and furious, you will take small comfort in your “right” to have given the hospital permission to destroy your body with impunity.
Here we get to the classic problem with the conservative/libertarian/free market notions of choice, rights, and liberty. In practice, the “freedom to choice” is affected by people’s relative degrees of power, yet the right’s notion of choice ignores these power imbalances. Imagine a situation (we don’t have to imagine, since it occurs all the time) in which an unscrupulous person “befriends” an elderly person, manipulating the person into handing over their social security checks using a series of sly verbal methods from flattery to cruelty to intentionally confusing the person. If you are a leftist, you would conclude that the elderly person has been exploited and their consent has not been meaningful. If you adopt the “free market” notion of choice, however, as soon as people sign on the dotted line, that’s the end of the inquiry. It doesn’t matter if they didn’t really understand what they were getting into, if they were desperate and felt they had no other choice, or if they couldn’t have anticipated what the consequences would be. You signed, so now you suffer. Sorry, bucko, life’s hard, get used to it. Tough shit. Sucks for you.
The left conception of rights says “if you can’t actually do something, having a right to it is practically meaningless.” So, if you have the right to “access” quality health care, but you can’t afford quality health care, then your right isn’t worth a damn. In the world of labor contracts, you might have the right to sign either a contract with provisions allowing you to sue or a contract without such provisions. Technically you have a right to any kind of contract you can negotiate! But realistically, if they can, employers are only ever going to offer you the kind of contract that limits their liability and restricts your remedies.
Every one of us agrees to things we don’t understand. How often do you read the entire text of a “terms and conditions” agreement before you click “I Agree”? We all know that nobody does this. And yet the implications of this should be acknowledged. If nobody understands what they’re agreeing to, then in what sense have they meaningfully agreed to it? Contracts are supposed to be a “meeting of the minds”: you expect something from me, I expect something from you, we put our expectations in writing. Terms and Conditions aren’t like that, because the customer’s expectations might be wildly different from the company’s. I might expect Gmail not to post all of my private emails on a public website called AllOfNathansEmail.com, but I have no idea whether they claim the right to do this under the terms of service I have “agreed” to by using them. People accept all kinds of things unknowingly, such as having their data sold to third parties. The Consumer Financial Protection Bureau (RIP) found that hardly anyone understands what an arbitration clause means or even that they’ve agreed to one, yet they’re everywhere. (Sometimes, as Abraham and Nimni note, even the companies themselves don’t know what their contracts mean.)
You could say that when people are agreeing to terms of service, they aren’t actually agreeing to the particular terms of service, since they don’t actually know what those are and there’s no “agreement” without mutual understanding. What they’re agreeing to, instead, is the Unknown. When I sign up for a service, and am presented with Terms and Conditions, what I am essentially doing when I click “agree” is saying “I agree not to care what your terms are.” Now, in a world full of venal capitalist sharks, that would seem a ludicrous thing to agree to. What if I’ve agreed to give Gmail my kidney? What if I’ve agreed to perpetual servitude on the Google Farm? But in a world where I’m constantly being offered these agreements, what else can I do? I suppose I could go completely off the grid, try to never interact with a corporation. I could spent many uncompensated hours meticulously trying to parse the terms of service to figure out just exactly what they do and do not imply, though I couldn’t negotiate over them even if I understood them. Or I could just do what everyone quite sensibly does, which is to say “Fuck it” and hope for the best.
There is a wholly stupid idea at the center of “terms of service” agreements, namely that if you can get someone to say “fuck it,” you can do whatever you please regardless of whether they could reasonably have expected you to do it. If we were actually concerned with securing people’s meaningful consent, instead of their desperate surrender, we could do things very differently: Set out a standard range of things that a company is entitled to do, educate people on what those things are, and require that any company that deviates from the standard range of expected things has the burden of proof to show that its customers actually understand those changes. So our “Standard Consumer Rights Contract” might say “Companies cannot sell people’s data to third parties.” A company that did want to sell its customers’ data to third parties would have to tell people it was going to do that, and have people agree to that. We have certain government requirements like this for financial institutions, but in practice even “disclosure” statements aren’t necessarily meaningful amid a vast stack of paperwork and we can think of ways, like quickly quizzing customers on the two or three main points, to ensure awareness. (So there would be a question: Do you agree that we can sell your data to anyone we please?” rather than “Do you accept The Mystery Terms?”)
This still doesn’t solve the “power imbalance” problem. It is always going to be harder for poor people to negotiate and understand contracts than rich people. If I am billionaire investor Warren Buffett, I can dictate terms to the bank, but if I’m lowly magazine editor Nathan Robinson, the bank will be dictating its terms to me. Everyone in business knows that negotiations between two parties are affected by both relative skill and bargaining power, yet in the world of consumer laws, conservatives pretend that consumers are somehow on the same level as vast corporations who are the gatekeepers to much of the world’s information supply. Try “negotiating” the terms of service with a major company. Good luck even getting in touch with the executive who would have the power to alter the terms of service. There is no “bargaining” process, there is a fraudulent legal fiction where in order to live in the modern economy, we have to simply agree that The Terms are fine and companies can do what they like.
Not that conservatives actually believe in the freedom of contract, even in the very narrow sense of “the freedom to sign your rights away.” Consider right-to-work states. Right-to-work laws are actually a prohibition on a particular type of contract: a contract that requires you to pay union dues as a condition of employment. Under freedom of contract theory, this makes no sense: An employer can offer you a contract with whatever terms they like; why wouldn’t they be allowed to offer a contract requiring that you join the workers’ association? They could offer you a contract requiring that you let them delete your tweets, or that you let them deduct a portion of your wages for every orange you consume in the break room. A contract requiring union membership is no different than a contract for a law firm job requiring that you join the bar association.* Unions are a free market mechanism: Employers get together to use their bargaining power to pressure employers into changing a policy, and introducing a new contractual condition. That’s not coercion, it’s the use of market power. (Milton Friedman, who was consistent, opposed right-to-work legislation for this reason.)
Honestly, it’s kind of hilarious that free market conservatives have embraced “right to work.” They speak of people being “compelled” to join unions, by which they mean “required as a condition of employment.” But every time workers object to practices that are required as conditions of employment, defenders of free markets react without pity, saying contracts are choices rather than compulsion. The concept of “compulsion” slapped all over the Right to Work website requires the leftist premise that contracts are actually coercive because people don’t have any realistic option but to sign them!
Of course, if you do adopt that correct leftist premise, then you could indeed argue that right to work contracts are coercive. (You just have to be sure to abandon any other notion you have that contracts are freely agreed to.) But they are still no more coercive than any other employment provision, and in a world in which employment conditions are endless and invasive, I object the least to the one that requires employees to contribute to an organization dedicated to improving the conditions of themselves and their fellow workers.
Rights need to exist in reality, rather than just as some meaningless theoretical entity. Realistically speaking, people have to get jobs, and if job contracts all end up requiring people to sign away their legal rights, they don’t really have rights, at least not in any sense worthy of that lofty term. (I’m okay with it if we put it in air-quotes though. The “right” to negotiate contractual provisions.) “Agreed” terms of service and “free” labor contracts are based on transparently false premises. If people don’t know what they’ve agreed to, they haven’t really agreed to it. And if power is distributed radically unequally, one party to an agreement can be far more “free” than the other.
* What about a situation where you start as a nonunion employee, but then other employees vote to form a union? Surely, since your original employment contract did not say you had to pay union dues, it would be coercion to require you to? But that’s not the case, at least under “freedom of contract” theory. Certainly, if your contract offered you certain promises, and these promises conflicted with a requirement to pay dues, the employer would be violating your contract. But if your contract says you are an at-will employee, an employer can say that all employees who refuse to agree to the new conditions can be fired. Under at-will employment, bosses can get rid of you for having the wrong hairstyle or sniffing too loudly or not donating to the annual Secret Santa. It’s not clear why requiring you to join a union is any different from any other condition an employer might introduce. In America, if the boss wants to fire everyone and only hire people who agree to a certain additional condition, that’s the boss’s prerogative. If you don’t like it, you’d better develop a theory on the proper limits of employer power!
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