From Statute to Contract: The Law of the Employment Relationship Reconsidered

Abstract

Most observers would say that the employment relationship is regulated largely by statutes. This Article argues that the statutory regulation of the employment relationship, and its correction of market failures, is disappearing under the cloak of judicial decisions upholding contracts which, in one form or another, find individuals to have waived their and the public\u27s statutory rights. In a variation on the nineteenth century\u27s transformation of the employment relationship from status to contract, we have the contemporary move from statute to contract. Part I of this Article examines how contractual waivers operate within the framework of the statutory regulation of the employment relationship: Employers remove future disputes from statutory regulation by requiring applicants for employment and incumbent employees to agree, as the price of securing or retaining a job, to have all employment-related disagreements, including alleged violations of statutory rights, decided by arbitration rather than litigation. Employers insulate current and prior employment decisions from legal challenge by requiring employees to release all claims, including those based on statute, as the price of receiving enhanced benefits. In both of these circumstances, an individual who has not challenged an employment practice or personnel decision agrees to forego statutory rights whose significance may not yet be appreciated, in order to secure something of immediate value, like a job or a benefit. I call these agreements waivers-for-private-gain. Part II addresses the operation and impact of waivers-for-private-gain, as well as the criteria for allowing these private agreements as long as they meet some type of knowing and voluntary waiver of statutory rights. Although the courts in applying the various statutes use somewhat different terms and standards in describing a knowing and voluntary waiver, the core, shared concept is procedural regularity. I argue that attention to procedural regulatory addresses whether a waiver is knowing but denies the concept of voluntariness any independent meaning. In Part III, I demonstrate that legal analysis ignores, to its detriment, the rich philosophical literature on voluntariness and its counterpoint coercion. focusing on the work of Joel Feinberg and G.A. Cohen. Part III concludes that only a fully realized conception of voluntariness provides a legitimate baseline for examining the authenticity of contractual waivers of statutory rights in the employment relationship