Economic Duress in U.S. Employment

43 Comparative Labor Law & Policy Journal (Forthcoming)

Loyola Law School, Los Angeles Legal Studies Research Paper No. 2023-40

23 Pages Posted: 18 Dec 2023 Last revised: 16 May 2024

Date Written: December 7, 2023

Abstract

Eight decades after the legal realist and comparativist John Dawson documented the beginning of an evolution of the doctrine of duress in U.S. employment, I have been charged with answering two questions: (1) whether, as Dawson predicted, the doctrine has transitioned from a more restrictive psychological duress standard to a more expansive economic duress standard and (2) if so, why the courts have appeared to be the prime movers. Neither question has a concise answer. As for the first, I have canvassed cases and determined that the doctrine has nominally evolved but most courts have refused to follow along, with only the occasional judge finding for an employee claiming duress. As for the second, the rare judge who finds the possibility of duress has done so only by exploiting ambiguities in the doctrine, perhaps out of a fundamental sense of fairness or due to legislative inaction.

Such confusion around the doctrine of duress, however, is generally bad for workers, courts, and even employers. I argue that courts should universally and consistently adopt the Restatement (Second) of Contracts' economic duress test that objectively considers whether a worker had "no reasonable alternative" to assenting to the contract at issue. This would put an end to the antiquated and subjective "deprivation of free will" test that still informs many courts' analyses. In the meantime, however, it is generally a good thing that some courts are exploiting duress’s doctrinal inconsistencies to rule for workers in especially dire circumstances.

Keywords: contract law, employment law, labor law, comparative law, personnel economics, economic perspectives, legal theory

JEL Classification: J00, J2, J3, J4,J5, J6, M5

Suggested Citation

Harris, Jonathan, Economic Duress in U.S. Employment (December 7, 2023). 43 Comparative Labor Law & Policy Journal (Forthcoming), Loyola Law School, Los Angeles Legal Studies Research Paper No. 2023-40, Available at SSRN: https://ssrn.com/abstract=4657280 or http://dx.doi.org/10.2139/ssrn.4657280

Jonathan Harris (Contact Author)

LMU Loyola Law School ( email )

919 Albany Street
Los Angeles, CA 90015-1211
United States

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