Lastly: I'm not a corporate lawyer, so I don't know what legal reasons a company has to prefer arbitration over legal procedures. But they must have some. And those reasons are unlikely to lead to worse outcomes for the company.

It is contentious because legal research has repeatedly demonstrated that there are legal fields in which for an undetermined reason the plaintiff faces far longer odds than they would have in court.

This concerns arbitrations that in 90% of cases are in favor of the defendant. While in 'normal' case law you see rates closer to 60%. (Yes the research also accounted for cost differences by comparing similar classes of cases, no-cure-no-pay etc..)

It is also suspected that the plaintif usually gets less compensation for damages through arbitration.

Another issue is that arbitrators sometimes earn a lot money and are obviously incentivised to attract 'customers'. The problem is that there are and will always be many more plaintiffs than there are defendants. So the selection of arbitrators depends on decisions by the future-defendants. (Unless a specific organisation is legally mandated, but I've not encountered this before)

Also, pretrial discovery is much broader in a class action, so much more expensive. The procedures available to a plaintiff in an arbitration are much more limited.

But big picture, it’s better to have more options rather than fewer.

Many of these people are struggling to make ends meet and it’s a lot of effort and lost work to risk for a small payout, but if enough individual claims are won it doesn’t take much effort for some lawyers to start automating the process and file tens of thousands of claims like those against Uber.

https://www.hklaw.com/en/insights/publications/2022/04/uber-...

Oh no - you're facing millions of dollars in mandatory fees to defend against thousands of nearly identical cases in arbitration? My goodness, who forced you to adopt that arbitration clause? How terrible of them.

When you hire a gardener to mow your lawn, you don't get to specify whether they use a Greenworks or Black & Decker mower. Or require that they pay you to train them how to trim your junipers.

In this situation, the law should be clear up front that this sort of relationship is disallowed, such that the circumstance never occurs to go to arbitration.

All other responsibilities have to be legally enforced; stuff like worker safety, food safety, minimum wage, 8-hour workday, no child labour etcetera.

These are all things companies will gladly ignore if it profits them. Minimum wage in this case, through a loophole of payback.

This allows plenty of scope to make considerations like long-term reputation and employee satisfaction/loyalty/welfare high priorities, even at the expense of profits.

There's plenty of scope for further discussion about these points, but the key point remains: shareholder primacy is not law and not the focus of company directors' fiduciary duty.

Uncapped growth is just as evil as unfettered greed - both charge forth without a second thought to externalities, while motivated to externalize as many costs as possible. So we end up with boiling oceans and rampant homelessness, because those are all "not our problem".

They are not. They are expected to serve the interests of the company, as distinct from the interests of shareholders, and matters like employee welfare/satisfaction and company reputation relating to externalities are very relevant to the interests of the company.

That some companies ignore these matters is separate from the principle: it’s not inconsistent with capitalism for companies to care about issues other than profits and shareholder returns.

Of course a corporation has responsibilities to its shareholders. But maximizing profit never has to be the only responsibility.

I personally know executives in some food manufacturing/preparation companies, both public and private, who gladly pay very close attention to worker safety, food safety, and all the things you say a company would do only if forced by law.

They do it because they know it's the right thing to do. And it helps them recruit and retain employees, and keep their customers happy. Their shareholders support them in this and would complain very loudly if the company ever put pure profit above all other goals.

Here is one reference for you:

https://www.nytimes.com/roomfordebate/2015/04/16/what-are-co...

https://archive.vn/ARcc3 in case it's paywalled, but it didn't seem to be for me.

> Corporations Don’t Have to Maximize Profits

> There is a common belief that corporate directors have a legal duty to maximize corporate profits and “shareholder value” — even if this means skirting ethical rules, damaging the environment or harming employees. But this belief is utterly false. To quote the U.S. Supreme Court opinion in the recent Hobby Lobby case: “Modern corporate law does not require for-profit corporations to pursue profit at the expense of everything else, and many do not.”

You will find many more citations with a search like this:

https://www.google.com/search?q=is+a+corporation+obligated+t...

Yes, and those companies exist in a society, and long term planning is vital for long term profits, and that is 100% sensible and correct operating procedure.

Treating employees poorly can effect the ability to hire, and retain good people. It can effect consumers' desire to buy your products. It can result in unions, and the passing of laws, and therefore red tape.

So even if you have a dim view, re corporate responsibility, it matters not, for that role has larger scope than "profit this second".

And beyond this? All corporate decisions are made by people, and those people have every right to make moral decisions.

I question that initial premise.

Few absolutist capitalists want to hear that they, their companies, their wealth, their shareholders, etc. are mere tools - which Human Society can use in pursuit of its own responsibilities...or quietly "dispose of", if Society finds them to be more trouble than they are worth.

First off: it's not a company's responsibility to increase shareholder profit. It very much depends on the view of the people involved. But you're completely right when you think that greedy people can push in that direction and that a legal framework is the only way to keep that in check and make sure companies pay their dues to society. Social democracy still seems the only way to strike a proper balance between exploitation and lack of incentive.

Most wealth in capitalism is built on the backs of exploited labor somewhere.

It’s over 50% so on average this is not true. But it nearly became true in 2008; turns out the Great Recession was bad. The trend after that is somewhat positive.

Though a problem with “exploited” is it’s zero sum thinking and doesn’t include customer surplus. If you get life saving surgery, you could say it has infinite value to you. If the surgeon asks for an infinite price, they’re exploiting you. If they don't, since you are therefore getting infinite unpaid value, are you exploiting them?

nb the people in this article are certainly being exploited, this is covered in theory under “monopsony”…

Also, that figure is before you consider the vast tax advantages of investing.

Does everyone have collective amnesia about Nike’s SE Asian sweatshops, or the hazardous working conditions in Bangladeshi garment factories that manufacture the most of our cheap fashion (the most glaring example being the Tazreen Fashion factory fire [0]).

Someone, somewhere is getting screwed out of fair wages for the corporation to make its profits.

0: https://en.wikipedia.org/wiki/2012_Dhaka_garment_factory_fir...

Curious on what basis bigger than 50% share of income constitutes non-exploitation? For example if there is one owner and 1000 employees.

This issue came up a lot with work from home during the pandemic. Did your power bill go up from running your employer-provided hardware at home? In some jurisdictions, they have to compensate you even for that.

There's usually a definition or test, either in statute or case law. In my jurisdiction, whether you have a boss or supervisor is a major factor. Contractors are given a specific task to complete and then they go do it. If you're getting daily monitoring or tasks assigned throughout the day, you're probably an employee.

Like with not paying minimum wage or illegal deductions, employers often get away with it. The power imbalance is very large for such workers, and even when enforced the fines are often just a cost of doing business. In Ontario, Canada there's a couple billion dollars in unpaid wages every year, and hundreds of investigations for wilful wage nonpayment by managers, yet there has been exactly one jail sentence for it, in the last twenty years. With odds like that, I might steal too!

Source: Have done so and won.

I think you would be shocked at how often this happens.

I once had a major Canadian bank try to make me buy a cell phone so they could avoid a minimal monthly charge for one??

HR in Canada is rife with abuse, because they are under no obligation to tell you what the laws actually are. Your ignorance of the laws works to their advantage.

See "non disclosure agreements" in Canada for a prime example.

This is hard. who should shoulder required competence?

(I understand that it is general competence said person received, not organization specific)