Analysis Law and Policy

Local Advocates, New Labor Secretary Both Critical to Domestic Workers’ Movement

Sheila Bapat

Scrappy advocates representing domestic workers throughout the country may be realizing victories of even deeper significance than a person holding a politically-appointed position ever could.

The shuffling of cabinet members taking place in the Obama Administration will include a new Secretary of Labor, and Colorado Lt. Governor Joe Garcia’s name has recently been floated as a possible nominee. A critical labor issue gaining momentum that the next Labor Secretary will need to focus on is the treatment of domestic workers under labor laws. Gov. Garcia, a former university president, has an extensive background in education policy but there is little to no evidence of how he would lean on issues relevant to domestic workers or other vulnerable workers (Gov. Garcia could not be reached for comment for this piece).

Domestic workers are typically foreign-born women who toil in private homes as nannies, caregivers, and housekeepers but often don’t earn even a minimum wage. The surge of U.S. advocacy for domestic workers’ rights over the last several years has engaged many diverse actors—from community organizers who live and work alongside domestic workers, to the highest leadership in federal government—all of whom are “in motion around a shared vision,” as National Domestic Workers Alliance Director Ai-jen Poo once told me.

Former Labor Secretary Hilda Solis, who resigned her post in January after serving four years, played a role in the movement, as she prioritized some of the most vulnerable workers in the United States. Solis pushed for minimum wage and overtime pay for domestic workers. Domestic workers have historically been excluded from the Fair Labor Standards Act (which guarantees most other workers minimum wage and overtime), and from a host of other labor laws. Solis’s efforts were critical and whoever fills her shoes will hopefully carry on her commitment.

While we wait for a new Secretary of Labor to take the reins, scrappy advocates representing domestic workers throughout the country may be realizing victories of even deeper significance than a person holding a politically-appointed position ever could. California Attorney Rocio Avila is a perfect example of this. Ever since Avila graduated law school nearly seven years ago, she has been representing domestic workers in Northern California in their civil suits against employers. Her clients—workers who toil in private homes cleaning, cooking and caring for children and elders—have typically been denied the wages promised to them or even the legally-mandated minimum wage. In the more egregious cases, her clients are human trafficking victims who have been physically or emotionally abused. She is a deeply committed litigator, having represented countless workers.

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In 2011, Avila secured a trafficked domestic worker a settlement of over $600,000. In Canal v. Dann, the Northern District of California ruled in favor of plaintiff Zoraida Pena Canal, a domestic worker who was trafficked into the United States in 2006 to live with and work for a Walnut Creek family. Pena Canal worked 6 am to 10 pm each day caring for two children and doing chores. For all those years of work, was only paid once: a single check for $100.

Pena Canal’s employer was sentenced to 60 months in jail, and the Northern District also ruled in favor of Pena Canal in her civil suit. Though under California law some domestic workers are entitled to overtime pay, the state’s labor code still excludes many caregivers from the right to overtime pay unless the worker can demonstrate that they are not just a personal attendant but also take on general domestic labor—such as housekeeping and cooking. In her argument Avila urged the court to view her client’s case as a non-personal attendant case and as a result, her client was awarded compensatory damages that include overtime pay.

Not only did the Northern District of California determine she is a non-personal attendant and therefore entitled to overtime, but they also determined that her overtime pay should be based on the prevailing market wage of $23.70 per hour. Typically, the courts will order payment of overtime based on the state’s minimum wage—which in California is $8.00 per hour. In sum, Pena Canal’s compensatory damages (including unpaid overtime) came to over $340,000. An additional nearly $300,000 was ordered for restitution, emotional distress, and other damages.

“The process of convincing the court of the above was in and of itself a product of community lawyering and grassroots advocacy at its best,” Avila told Rewire. “There is no way we could have prevailed if weren’t for the groundbreaking work of the many individuals behind the domestic worker movement both in New York and in California, which I used as my experts to educate the court and advocate for dignity for my client.

Avila and her colleagues are working hard to overcome a legal disparity that never should have existed in the first place. Federal regulations that guarantee overtime—at the prevailing market wage, not just minimum wage—for domestic workers would help create consistent standards for all domestic workers, whereas district court cases can always be undercut by a circuit split. As it stands, there are no federal regulations that address this issue — Solis made headway on revising regulations to ensure that more domestic workers would be eligible for overtime, but these regs are still being considered by the White House.

The precedent that Avila’s advocacy set is certainly far ahead of federal and state regulations, as there has not been any discussion of domestic workers earning overtime at a prevailing wage. Regardless of who fills Solis’s shoes, the domestic workers’ movement will be pushing him, or her, for deeper change.

News Economic Justice

Wage Theft Could Cost $32 Million Weekly for Pennsylvania’s Low-Wage Workers

Michelle D. Anderson

Advocates say that government oversight is weak, and laws only provide a slap on the wrist when they are enforced. Pennsylvania—much like the federal government—lacks enough regulators.

The U.S. Supreme Court’s recent refusal to consider a case involving several thousand Walmart employees brought attention to what employment advocates in Pennsylvania call a hidden crisis: wage theft.

Legal aid agencies and advocacy organizations such as the Pennsylvania-based Women’s Law Project use the term to describe employers’ refusal to pay wages due their workers.

“Shortchanged: How Wage Theft Harms Pennsylvania’s Workers And Economy,” a study released by the Sheller Center for Social Justice at Temple University’s Beasley School of Law, revealed that cooks, dishwashers, and food preparers, along with stock/office clerks and retail salespeople, were among the largest low-wage worker groups experiencing weekly minimum wage violations.

Employers commit wage theft by paying a daily rate that does not meet Pennsylvania’s $7.25 hourly minimum wage requirements, misclassifying people who work as independent contractors, paying in cash, failing to keep adequate records, and taking money out of paychecks to account for uniforms, supplies, and other products necessary to perform the job.

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Terry L. Fromson, managing attorney at the Women’s Law Project, a public interest legal center, told Rewire that the practice compromises women’s economic security in Pennsylvania, where women make up about two-thirds of people who work for minimum wage, and where the minimum wage is the lowest allowed by federal law.

“Factor in losing 15 percent of a would-be paycheck to wage theft, and a family led by a primary or sole breadwinning mother sinks further into poverty,” Fromson said.

In the Walmart case, first decided by a Philadelphia jury in October 2006, 186,000 current and former employees from the retailer’s Pennsylvania stores were awarded $187 million in a class action suit for unpaid wages that were withheld between March 1998 and April 2006.

The workers’ counsel, Donovan Litigation Group, said the employees had been owed $140 million of the $187 million and will now split $224 million due to interest, according to the Philadelphia Inquirer.

Walmart had appealed the decision in 2006, taking the case to Pennsylvania’s Supreme Court, who affirmed the jury verdict in 2014. U.S. Supreme Court justices on April 4 decided to not take up the case and to support the state’s high court decision.

In the years since Walmart employees first took action, workers and legal aid agencies across the United States, including in Pennsylvania, have brought many more wage theft cases.

Last year, for example, more than three dozen people who work for low wages at the Denver-area Carniceria y Verduleria Guadalajara grocery store won $305,000 in back wages and penalties in a U.S. District Court ruling using federal and state “wage theft” laws.

Papa John’s franchisees in New York were found guilty of wage theft last year and ordered to pay back more than $500,000 to settle claims that they swindled employees out of earned income.

There remains, however, little information as to how prevalent wage theft has become across the country, advocates for low-wage workers told Rewire. The Sheller Center last year sought to fill the void in wage theft data in Pennsylvania.

The study, which used the state’s right-to-know law to obtain data from the Pennsylvania Department of Labor and Industry (DLI) and relied upon extrapolations rather than original data, found that the state’s people who work for low wages, on average, lose about 15 percent of the their earnings to wage theft.

The study suggested that nearly 400,000 people who work in Pennsylvania experience a minimum wage violation and more than 300,000 experience an overtime violation every workweek. The weekly loss amounts to an estimated $19-32 million in wages, according to the “Shortchanged” authors.

The study revealed that the DLI, the state agency responsible for handling wage theft matters, was unable to collect wages in more than half of the complaints filed by people who work.

In fact, despite closing 5,000 cases annually, the DLI collects wages in about 2,000 of those incidents, according to the Temple University study.

The U.S. Department of Labor in a study released last year acknowledged the prevalence of wage theft among wage and salary workers in California and New York.

The report concluded that more than 300,000 people who work in those states were victims of wage theft. Many of those affected, the federal study revealed, work in service-based positions in the restaurant and hotel industries and were more likely to be women, people of color, and undocumented people.

Undocumented residents in New York, for example, were 3.1 times more likely to experience wage theft.

A local report released by Centro de Trabajadores Unidos en Lucha in Minneapolis found that nearly half of low-wage workers in the Twin Cities have experienced wage theft.

Nadia Hewka, senior attorney at Community Legal Services, a Philadelphia-based legal aid outlet, said many businesses exploit undocumented workers’ vulnerabilities.

“Employers cut corners—some of them will choose to hire immigrant workers because they think they won’t complain,” Hewka told Rewire.

At Community Legal Services, Hewka said many people who work don’t know they are entitled to overtime and often seek to recover wages after they haven’t been paid for extended periods of time.

“That often happens with immigrant workers who are not familiar with laws in the U.S.,” said Hewka, co-founder of the Pennsylvania Immigrant Workers Rights Coalition.

The “Shortchanged” authors noted that undocumented workers fear their supervisors will call immigration authorities, while immigrants with employment visas are often afraid they may lose visa privileges if they speak up.

Identifying Wage Theft

The Temple University study, which excluded low-wage employees in more rural settings, like farm, forestry, and fishing workers, outlined the many ways employers get away with wage theft.

The report relied upon a landmark investigation released in 2009 called “Broken Laws, Unprotected Workers,” which surveyed low-wage workers in Chicago, New York City, and Los Angeles.

The “Broken Laws” study estimated about 90 percent of home health-care workers were victims of off-the-clock violations.

Philadelphia resident Natasha, whose last name was withheld by the “Shortchanged” authors, was a victim of wage theft while working as a home health-care worker.

Her employer, who often avoided workers and created barriers to keep employees from engaging each other about their paychecks, failed to compensate Natasha for travel time between client homes and even missed paycheck due dates.

The mother of four, who made $9.50 per hour and witnessed her boss call the police on coworkers who complained about wage theft, was ultimately fired after becoming ill despite her stellar attendance and documented excuse for missing work.

“I was so frustrated and I wanted to break down and cry because I couldn’t spend another week not being able to feed my children, having to choose between bread, eggs or milk,” she said, according to the study. “It was the worst experience of my life.”

Advocates for people who work low-wage jobs contend that wage theft also hurts the state’s economy, because money that would otherwise be spent in the economy is stolen from people who work, while businesses evade taxes that could be used to fund schools and road projects.

Law-abiding businesses may struggle to compete with enterprises that steal wages, advocates said.

The U.S. Department of Labor study noted that the burden of wage theft ultimately shifts from the private sector to the government because people who work for low wages will seek public assistance if their pay is insufficient.

People who work for low wages and their allies have looked to key policy changes to address wage theft, though it’s proven difficult because of resistance in Pennsylvania’s Republican-controlled legislature, Hewka said.

Some measures proposed during the 2015-2016 legislative session, like HB 250, which sought to raise the penalty for wage theft and for retaliating against an employee for reporting said theft, get stuck in committees and die there, she said.

A resolution to discharge the house’s labor and industry committee from further consideration of HB 250 was presented in October 2015.

Legislators in other states have proposed measures aimed at addressing wage theft. Democratic lawmakers in Wisconsin last year proposed legislation that would allow the state’s Department of Workforce Development to charge interest on unpaid wages and levy fines up to $1,000 per violation against employers who break state wage theft laws.

Hewka added that government oversight, overall, is weak and laws only provide a slap on the wrist when they are enforced, she said. Pennsylvania—much like the federal government—lacks enough regulators, she said.

In Pennsylvania, the Minimum Wage Act and the Wage Payment and Collection Law are the protections low-wage workers can rely on to reclaim stolen wages.

The Wage Payment and Collection Law limits penalties to the higher of $500 or 25 percent of wages owed, and includes criminal fines limited to $300.

The state’s minimum wage law, on the other hand, doesn’t offer any damages to people who work low-wage jobs, unlike federal law.

“Shortchanged” authors have recommended harsher penalties for employers, including business license revocation and allowing people who work to place a hold on employer’s property until they receive unpaid wages.

Other solutions encourage state policymakers to collaborate with community groups to target investigations and to create a process for workers to submit anonymous or confidential complaints.

The state has enjoyed some successes in battling systemic wage theft against people who work.

Philadelphia City Councilman William “Bill” Greenlee sponsored a bill that will create a wage-theft watchdog in the city’s Managing Director’s Office.

The bill, which was unanimously approved by the council in November, requires a wage-theft coordinator to respond to worker complaints and find victims who may lack education about their rights.

The coordinator will be responsible for looking at thefts of anywhere between $100 and $10,000, and can revoke business licenses and impose a city fine of $2,000 per incident.

Hewka, who worked with Greenlee on the measure, said the city should be prepared to handle complaints in July.

The measure, she said, will offer relief to low-income citizens who cannot afford a private lawyer and legal aid groups who can only provided a limited amount of free services.

Analysis Health Systems

How Workers’ Comp Policies Leave Women to Fend for Themselves

Jean Stevens

"It's ironic and stunning that, on the one hand, we’ve seen incredible progress for women, yet on the other hand, they’re inundated with little bits of discrimination and people don’t really realize it," said Jenny Schwartz, partner at Outten & Golden, a national employment law firm.

Shortly after receiving a diagnosis of Stage 1 breast cancer in 2012, Janice Page of San Diego was surprised when her boss told her that she should file a claim for workers’ compensation—payments from an employer to compensate a worker who suffers a job-related injury. Page, a county sheriff and first responder to chemical fires, explosions, gas spills, and other emergencies, didn’t know much about it. Still, she took her employer’s advice, and when her state-appointed doctor determined that her cancer would not qualify her to receive any workers’ compensation, something felt off.

Page contacted an attorney, and learned that if she’d been a man diagnosed with prostate cancer, she’d automatically be entitled to substantial benefits.

“I don’t think it’s fair at all, and it’s not right,” said Page, who recently testified to California Assembly members about her experience when the assembly was considering new legislation to ban gendered assessments in workers’ compensation claims. She’d undergone multiple surgeries, a mastectomy, and reconstruction as a result of treating her cancer. “I don’t want another woman to have to deal with what I’m dealing with.”

Despite Page’s story, and evidence that more than 9,000 claimants annually would be affected by this change in the law, California Gov. Jerry Brown vetoed the legislation—called AB 305—on October 6, cowing to pressure from corporate and compensation insurance industry lobbyists threatened by the possible added protection to injured workers. The bill’s veto serves not only as a strike against women, but also a convenient strike against workers in the escalating corporate war on workers’ compensation.

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AB 305 and Its Implications

Introduced by Assemblywoman Lorena Gonzalez (D-San Diego) in March, AB 305 would have amended California’s labor law as it involves state-hired doctors who evaluate workers for workplace compensation claims. Under three amendments, the bill would bar doctors from factoring gendered medical conditions of menopause and pregnancy into their evaluations of an injury when those conditions had no proven impact on their injury. Doctors could also not factor in workplace sexual harassment, menopause, or pregnancy to the case of a worker who suffered a workplace psychiatric injury if that injury arose at the same time of the harassment, menopause, or pregnancy. Finally, it would have forced doctors to rate prostate and breast cancer equally in their evaluations.

Gonzalez and the bill’s supporters, including the California Democratic Caucus, workers’ groups, and many of the state’s women’s groups, believe the administration’s denial reflects a greater war on women in the workplace. While workplace discrimination such as this hardly resembles the explicit forms faced by women workers in the past, it still manifests in various ways, including in workers’ compensation decisions, said Jenny Schwartz, partner at Outten & Golden, a national employment law firm.

“It’s ironic and stunning that, on the one hand, we’ve seen incredible progress for women, yet on the other hand, they’re inundated with little bits of discrimination and people don’t really realize it,” Schwartz said. “In order to achieve gender equity in the workforce, the whole point is to diligently attack each and every occurrence which is perceived to be a smaller type of discrimination. It’s a bit like whack-a-mole.”

AB 305 inspired a heated “boobs and prostate debate” among lawmakers and pundits, as the bill would require workers’ compensation doctors to rate the diagnosis of breast cancer and prostate cancer equally. Under current California law, which is based on a system of guidelines by the American Medical Association (AMA), workers with prostate cancer resulting from their work conditions receive a 16 to 20 percent disability rating. Workers diagnosed with breast cancer “of childbearing age” only receive a 5 percent rating and those of “non-childbearing age,” like Page, have a 0 percent rating, said Christel Schoenfelder, workers’ compensation attorney at Rose, Klein & Marias LLP and president-elect of the California Applicants’ Attorneys Association.

“Imagine a 60-year-old female firefighter who’s been fighting fires and been in the front lines,” Schoenfelder said. “She’s diagnosed with breast cancer and it’s related to toxic exposure. When the doctor goes to calculate her percentage of permanent disability, she’d get nothing, because she’s not a woman of childbearing age. Now, in the same situation, but a man [with prostate cancer], he gets 16 percent to 20 percent. If he’s incontinent, he gets another percent increase. If sexual dysfunction, another.”

To AB 305 supporters, this gendered distinction indicates that AMA guidelines only value breasts in the context of child-rearing; they have no other purpose, and in turn, their loss has little effect. It ignores the side effects of breast cancer and mastectomies, Page said, including physical pain, numbness, reduced range of motion, psychological anguish, post-traumatic stress disorder, and loss of sense of self and identity.

“If a man had his balls removed and had plastic ones put there, how would he feel?” Page said. “If they had been removed, I’m sure it would be psychologically [damaging] to them, too.”

AB 305’s second proposed change to the California labor code sparked far less excitement, but the need behind it feels equally infuriating to supporters. Under current state workers’ compensation law, a person who cannot work at all because of the job injury is considered permanently disabled. State-appointed doctors examining a woman worker who has been injured are entitled to credit—or apportion—some of their injury to menopause and pregnancy, even if that person never felt any side effects or health problems from these conditions before their on-the-job injury, Schoenfelder said. In turn, these women receive less compensation from their employer. In other words, male workers facing certain injuries would receive full benefits, but injured women workers would automatically have their benefits reduced if it is possible their injury results from menopause or pregnancy, even if there is no indication of these conditions. AB 305 would forbid doctors from apportioning injuries to these conditions. It would also prevent them from factoring in psychiatric disabilities caused by these conditions, and sexual harassment resulting from these conditions.

“It’s when something is asymptomatic, and maybe the person doesn’t even know she has it, and it hasn’t even hampered your job,” Schoenfelder said. “These are not actual causes [of an injury], but risk factors. That’s what makes it discriminatory.”

Schoenfelder, rifling through files in her office during one recent phone call, read aloud from one report from 2014 where a doctor evaluated a worker with “common gender nonoccupational risk” and reduced her rating by 20 percent. In another 2015 report of a worker with a shoulder rotator cuff injury, she said, the doctor observed “calcium deposits in a rotator cuff,” but blamed 50 percent of it on “genetic predisposition,” as women are more likely to have such deposits. Then 50 percent of her disability was reduced. She added that other reports include doctors tying workplace injury symptoms to pregnancy and breastfeeding, even when symptoms occurred before workers became pregnant.

“I have never seen a report where a doctor has specifically said, ‘men get this more often, so I’ll apportion about 50 percent because I know statistically men get this more,'” Schoenfelder said. “When conditions cited by doctors are exclusive to women, then it becomes that being female is a preexisting condition.”

Gov. Brown rejected this thinking, however, claiming that these sorts of evaluations are valid. He wrote in his “veto message” that AB 305 “is based on a misunderstanding of the American Medical Association’s evidence-based standard, which is the foundation for permanent disability ratings, and replaces it with an ill-defined and unscientific standard.”

It’s a curious position, given that doctors in California and many other states make these evaluations based on the AMA guidelines, which is an inherently man-made system. Individual body parts receive greater “worth” and compensation, with required surgeries and “hardware” earning more. (Other states, including New York and Florida, have created their own system to evaluate disability.)

“That system is not really all that scientific to begin with,” said Julius Young, partner at Boxer & Gerson, LLP in Oakland, explaining that the guidelines are built around a conception of ‘whole person impairment” and ability to perform daily life activities with a certain injury, and this is given an arbitrary percentage. “[Brown’s] saying that it’s undefined and unscientific is a little ironic. People who were putting these things together maybe didn’t believe in certain conditions. They probably didn’t think about women losing their breasts. [It’s] changed over time with different editions.”

Young, who followed AB 305 since its introduction at his blog WorkersCompZone.com, believes the veto makes sense in the current California political climate around workers’ compensation. After a spike in workers’ comp claims in 2003, he explained, the state passed some reforms that were quite popular with insurance providers. Under those reforms, a doctor was required to express an opinion of all the possible causes for injury. This led to doctors “splitting up a pie,” as Young explained, for example, attributing one-third of the injury as a direct result to what happened while on the job, one-third to a prior injury, and one-third to aging process and osteoporosis. Subsequent rising costs, however, led to greater reforms in 2012, but no one remains satisfied.

“It’s really an issue that keeps coming back,” Young said. “[And I think] Jerry Brown doesn’t want to see this [workers’ compensation bill] become a front-page issue.”

The veto, then, represents another strike by businesses in their campaign against workers’ compensation.

“Employers are doing everything they can to reduce costs of workers’ comp,” said Paula Brantner, executive director of Workplace Fairness, a nonprofit public education and advocacy organization that provides workers’ rights information. “If they can screw their workers, keep wages flat, keep benefits flat, cut health care, they will,” she said. To fight it, advocates and workers must step forward and bring the most egregious examples to light.

Left to Fend for Themselves

States nationwide have slashed workers’ compensation benefits within the past ten years, according to a recent ProPublica and NPR investigation of insurance industry data, state laws, and court and medical records. Employers pay less in compensation today than any time in the past 25 years, and California and Oklahoma tied for the most cuts since 2014, the study found. Federal workers’ compensation mandates put in place in 1972 are mostly dissolved: Gone are the years where injured workers could pick their own doctors, receive compensation for all the years of their disability, or, if they died due to their injury, ensure that their spouses would receive death benefits until remarriage and their children would receive tuition benefits through college graduation.

According to the ProPublica study, legislators from California, West Virginia, North Dakota, and Oklahoma have imposed two-year time limits on claims made by temporarily disabled workers, even if they still cannot work after those two years. In another ProPublica investigation that NPR released in October, Oklahoma and Texas—and possibly soon Tennessee and South Carolina—have passed laws allowing employers to “opt out” of workers’ compensation completely. Employers then create their own workplace injury plans, which, according to the investigation, “generally cover fewer injuries, cut off benefits payments sooner, control access to doctors and even impose mandatory settlements.” Employers in those states, including Costco, Taco Bell, and Sears, have “opted out” of workers’ compensation to create their own plans when workers become injured. Under their opt-out plans, employers may refuse to cover the cost of basic injuries, like work-related infections, and deny benefits if injuries are not reported within the same shift when the injury occurs, preventing workers from making a claim if they only realize later on the full scope of their injury. They also require that company representatives accompany injured workers to doctor’s appointments so as to monitor or interpret what doctors say. Even worse, these plans do not provide an option to appeal to a third party or court, unlike in the current system, which has due process protections built in. Opponents consider it a return to the Industrial Revolution “when workers and their families had to sue their employers or bear the costs of on-the-job injuries themselves.”

Workers receiving less are now turning to welfare and other government programs, including disability benefits through Social Security, which opponents to these plans argue puts a greater burden on the government, and in turn, taxpayers. Today, families and their own private health insurance pay for about 63 percent of their lost wages and medical costs of work injuries, while workers’ compensation payments covers only about 21 percent of lost wages and medical costs of work injuries and illnesses, according to a 2015 study by the U.S. Department of Labor’s Office of Safety and Health Administration. Taxpayers cover the rest. In addition, 97 percent of workers with occupational illnesses receive no compensation, mostly because doctors do not diagnose them as work-related.

Left to fend for themselves in court based on the current law, many injured women workers could not effectively challenge workers’ compensation decisions for their injuries when doctors unfairly factored in menopause, pregnancy, or sexual harassment, or minimized their breast cancer. They typically must hire an attorney. But not all workers can afford legal help, leaving these individuals to face discrimination at a disproportionate disadvantage.

“Any employee in California can be subjected to the workers’ comp system at any moment,” Schwartz said. “If you’re poorly educated or from a lower socioeconomic group, or struggling with economic issues, and you’re not represented by counsel, you’ll have to accept what happens through the system.”

CORRECTION: A previous version of this article misspelled the Workplace Fairness executive director’s name. It’s Paula Brantner, not Branter. We regret the error.