Saturday, October 16, 2021

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 Abstract

Excerpted From: Kaiponanea T. Matsumura, Breaking Down Status, 98 Washington University Law Review 671 (2021) (415 Footnotes) (Full Document)

 

KaiponaneaTMatsumuraIn his Commentaries on the Laws of England, William Blackstone organized the private economic rights of persons into “three great relations,” that of husband and wife, master and servant, and parent and child. “Employer” and “employee” have replaced “master” and “servant” in modern parlance, so it may seem odd from our current perspective to group the master-servant relation with others that we now consider family relationships. But servants lived and worked as members of a household in England and the American colonies throughout the seventeenth and eighteenth centuries. At the time, “[t]he notion of a labor market in which individuals freely sold their labor did not exist,” and “until the nineteenth century, there were practically no people in employment relationships.” The head of a household-- always a man--was charged with the duty and granted the corresponding authority to “maintain[] a well-governed home,” which was composed of “spouses and their offspring, apprentices, servants,'bound-out’ youths, and other dependents ....” Whether agrarian or mercantilist, the household was the unit of economic production, meeting the financial and support needs of its members. The status of householder also gave a man political significance, making him “the sovereign of a domain, able to meet with other rulers and to participate with them in government.” Blackstonian statuses therefore bound up personal, economic, and political duties and located them within the home.

Although the status of master and servant has migrated outside the home, leaving behind the status of husband and wife, both have undergone several similar developments since Blackstone's time. Now known as employment and marriage, they have become more contractual in nature, tolerating significant customization. They have become easier to exit and correspondingly less permanent. They have also inched away from their hierarchical social meanings. Nevertheless, both retain aspects of status.

Whether someone is an employee or spouse still triggers mandatory rights and duties between the parties, as well as between the parties and the state. Status can be an effective regulatory tool because the status determination gives the status holders and third parties that interact with them clarity about their rights and obligations. When status works, it becomes a powerful organizing principle that fades into the background--many people in this country, for instance, are lucky enough not to question their citizenship and all the rights that follow from it. Despite Henry Sumner Maine's oft-quoted pronouncement that “the movement of the progressive societies has hitherto been a movement from Status to Contract,” status still abounds: as we move through the world, the law continues to respond to us as citizens, spouses, employees, tenants, patients, parents, clients, limited partners, and more.

The very features of status that make it effective can also result in ossification, encumbering its response to inevitable social change. Status depends on identity categories that can become contested or rendered obsolete. Its mandatory, bundled nature hampers its ability to adapt to changed circumstances. And the inequalities that flow from its mandatory rules invite contestation. The juxtaposition of employment and marriage casts these shortcomings of status-based regulation in sharp relief.

Every person who works for a wage is either an employee or an independent contractor--nothing in between. The rapid evolution of the online “gig” economy in the last decade has revealed the limits of work law's binary approach to employees. By some estimates, between one quarter and one third of all U.S. workers are part of the gig economy--for instance, they may drive for Uber or deliver packages for Amazon. Employees are entitled to many legal protections from their employers, such as reimbursement for expenses and a minimum wage, while independent contractors are entitled to virtually none. Technology companies classify most gig workers as independent contractors, a status that some workers have contested through lawsuits and political mobilization. These are high-stakes disputes. To characterize these workers as employees would cost companies hundreds of millions of dollars and potentially drive them out of business; but the opposite conclusion leaves millions of workers ineligible for valuable benefits. The challenge is that many of these workers do not look like either traditional employees or independent contractors. Gig workers often work as little or as much as they want, often simultaneously for multiple firms, sometimes even for direct competitors; yet many do not perform tasks requiring special skills, exercise very little discretion in the work that they do, and can be terminated if they fail to adhere to the company's precise guidelines. These facts led one judge in an employee misclassification case to observe that the jury would be “handed a square peg and asked to choose between two round holes.”

In the family law context, informal nonmarital relationships are the square peg; singleness and marriage are the two round holes. An informal relationship may involve emotional and sexual intimacy, commitment, resource sharing, cohabitation, and joint childrearing, but it may not involve all of those things. Over thirty-five million adults in the United States are in these types of relationships. People in these relationships are clearly not single as a practical matter, but they have not taken the consequential step of formalizing their relationships through marriage. Like the designation of “employee,” the formal status of marriage is the gateway to thousands of legal rights and responsibilities, such as inheritance, favorable tax treatment, standing to sue for various torts, and qualification for family leave and Social Security retirement benefits. That means that people in relationships bearing various degrees of similarity to marriage will find themselves without legal protections, subsidies, and obligations throughout the relationship and at its end.

New social arrangements render millions of individuals illegible to the binary and heavily laden statuses of employment and marriage. Some individuals find freedom in this void in that they owe fewer duties than they would if their relationships were regulated. Others find their socioeconomic and personal vulnerabilities magnified.

If status is the problem, one response might be to turn to contract law as a solution. Although status-based regulation has persisted since Maine's pronouncement 150 years ago, Maine was surely correct that legal relations previously governed by status have become more contractual, in the sense that they tolerate greater individual customization. Why not go all the way and entrust the parties with control over the legal consequences of their relationship, shedding some unfortunate historical baggage in the process?

For various reasons, however, regulation of these relationships through contract is not the option it seems at first glance. Either because of a desire to efficiently administer legal entitlements, privatize dependency, protect parties with less bargaining power, or control the meaning of the relationship itself, lawmakers have shown little interest in loosening their grip on these societally important relationships.

But even if the law were to embrace a contractual approach, the nature of the underlying relationships would inevitably exert influence over the administration of legal obligations in status-like ways. Although contract law largely respects individual choice, the doctrine retains mandatory aspects. Through doctrines such as unconscionability and public policy, the law imposes limits on the terms to which parties can agree. Rules governing who can enter into agreements and under what circumstances regulate the conduct of the contracting parties, making them more than legal strangers even if they are transacting at arm's length. Even the act of interpreting the terms of the parties' agreement requires a court to consider the context in which the promises were made, which means that aspects of the relationship itself might comprise the terms of the exchange. Legal rules based on these archetypal relationships arise, such as rules preventing cohabitants from contracting for marital-like financial obligations based on the performance of domestic labor. Contract folds back into status.

If some degree of status-based regulation is inevitable, the question is not whether to regulate through status, but how. That inquiry is complicated, however, because status is undertheorized. In contrast to the contract end of the contract/status binary, which has been deconstructed and reconstructed repeatedly in the scholarly literature, the meaning of status has largely been assumed to be in opposition to contract. Status, as I have been using the term up to this point, is a form of legal governance; a way of imposing a fixed bundle of rights and obligations based on a discernable characteristic. But it has multiple overlapping meanings, any of which might be invoked by courts and scholars at any given moment. Maine, for instance, uses status to describe legal obligations that are fixed by virtue of one's relationship to the head of the family. Implicit in this patriarchal model are the identities themselves--wives, children, slaves--which denote greater or lesser social standing. Thus, status can describe specific identities or social hierarchies in addition to the package of legal consequences that flows from the determination that one belongs to a given legal category. The goal of this Article is to explore how to reform status as a regulatory device, but these other meanings inevitably complicate that project. The fight over same-sex marriage, for instance, was both a fight over access to a package of legal rights and a fight for social respectability.

In pursuing its goal, this Article makes four contributions. First, it defines status by unraveling its different features and exploring their interrelationship. This exercise lays bare the stakes of a status determination, which involves tradeoffs between promoting autonomy, addressing vulnerability, and regulating conduct efficiently. Second, it documents the ways in which status's bundled, mandatory features can render it out of step with social change, leading to the emergence of regulatory voids. Third, it shows that contract doctrine itself has embedded within it significant aspects of status, making it impossible to avoid the types of policy questions that underlie status-based regulation.

These contributions ground the fourth, which is to identify the mechanisms by which statuses can be adjusted to accomplish the state's regulatory goals. Comparing worker classification and relationship recognition proves instructive, in that they reveal institutional design questions that apply whenever established statuses begin to fray. First, aggregation or disaggregation: how to tailor the package of legal consequences associated with the status by adding to or disaggregating those consequences, thereby changing the stakes of the classification. Second, binarism or pluralism: whether to keep one meaningful status designation and its opposite (employee v. independent contractor, married v. single), or introduce one or more alternate statuses. Third, boundary policing: when and how to determine whether someone falls within the status, and whether to make it easy or difficult to transition in and out. Lurking in the background and informing the answers to all these questions is the fact that the statuses of marriage and employment, as well as many other favored statuses, frequently overlap, swaddling some individuals in multiple layers of legal protections while leaving others out in the cold. Proposals to reform a single status, while valuable, only partially address the primary values of autonomy and vulnerability. Deep and lasting change requires a comprehensive status consciousness.

This Article proceeds in four parts. Part I provides a typology of the various meanings of status and identifies the core features of legal status. It also lays out the stakes of regulating through status.

Part II uses marriage and employment to show how the very features of status can sometimes undermine its effectiveness.

Part III takes a step back and reflects on a broader question: is it possible not to regulate through status? This Part shows that the temptations of regulating through status are simply too great for partisans to ignore, and further, that the law inevitably takes relationships into account when imposing consequences, importing critical features of status and making it impossible to escape some version of status-based regulation.

Part IV charts a path forward by identifying institutional design questions to guide reform efforts.

[. . .]

If status-based regulation is inevitable, then fights over status are inevitable as well. This Article ends with a reminder that those fights are interconnected in multiple respects.

The starting point of this article is the failure of two hoary statuses, marriage and employment, to extend rights and obligations to millions of people who bear striking similarities to those who are regulated. By focusing on the problem within the silos of work law and family law, insufficient attention has been paid to the ways in which the status-based approaches are failing as statuses. Just as importantly, the siloed view has hindered a discussion of the ways in which those statuses are mutually reinforcing.

This phenomenon has been exposed for all to see by the COVID-19 pandemic. Cohabitants on average have lower levels of education, lower incomes, and less stable jobs than married people. They are also in less stable unions, with the possibility of conflict only exacerbated by shelter-in-place orders. As discussed above, technology companies like Uber do not pay into state unemployment systems, leaving many gig workers without coverage under those systems. Many gig workers also fall within the essential worker category, which includes workers in healthcare facilities, farms, factories, grocery stores, and public transportation, and is disproportionately non-white. Workers in the food and agricultural sector, which accounts for 20% of all essential workers, or more than 11 million people, earn particularly low hourly wages, and a significant portion of them are gig workers. Many of them are also undocumented.

In short, those lacking protection because they fall outside of one type of favored status are somewhat more likely to lack protection under other favored statuses as well. Legal status and social status--while different concepts--are inextricably intertwined and mutually reinforcing. Although the evolution of marriage and employment are a testament to the possibility of incremental change, a broader status consciousness is needed to bring about more lasting, systemic change.

It remains to be seen what results will be produced by the dual shocks of the COVID-19 pandemic and the heightened race consciousness triggered most recently by the killings of George Floyd and others. But there are some indications that lawmakers are willing to reconsider entrenched aspects of status in light of pressing realities.

In response to widespread unemployment and underemployment brought about by the COVID-19 pandemic, Congress passed legislation providing stimulus payments to U.S. citizens and U.S. resident aliens with incomes below a threshold amount. Congress also extended unemployment benefits to workers not typically eligible, including gig workers. These measures appear to recognize the importance of addressing economic hardship regardless of employment status.

The intertwined health and financial crises brought about by the COVID-19 pandemic have also prompted the federal government to provide paid family leave for employees with a “bona fide need to care for an individual subject to quarantine (pursuant to Federal, State, or local government order or advice of a health care provider) ....” As one might expect, the law covers spouses and children; perhaps surprisingly, however, eligibility is determined by caregiving. Cohabitants, and even mere roommates, can qualify. The law, like COVID-19, does not discriminate on the basis of family status.

Although federal legislation has restricted coverage to U.S. citizens and others with preferred immigration statuses, some states have recognized the importance of supporting members of the community who would otherwise fall through the cracks. California, for example, has provided one-time, state-funded disaster relief assistance to approximately 100,000 undocumented adults who are ineligible for other forms of assistance. States, of course, have little power over immigration policy, but the popular sentiment reflected in California's action suggests a shift in attitudes about citizenship and belonging.

These developments show that the current tumult has awakened people to the shortcomings of the status frameworks that structure our lives. Though seemingly minimal and nascent, they signal a willingness to reconsider the relationships between statuses and the rights that flow from them. Now is the time to build on them.


Associate Professor of Law, Arizona State University, Sandra Day O'Connor College of Law.


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