Time’s up: Activists gather to speak out at a Silicon Valley rally in 2018 © AP
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Growing concerns over the ethical implications of the uses of technologies from facial recognition and drones to artificial intelligence have challenged the notion that tech companies are reshaping the world for the better.

With employee protests forcing change last year at some of the most valuable companies in the world, tech workers are turning their new-found power towards the culture of Silicon Valley itself. Their newest focus is on confronting corporate policies they say perpetuate sexism, lack of diversity and unwelcoming workplaces. This also implies job applicants’ growing discernment in choosing their employers.

In November, thousands of Google employees around the world walked out of work in protest at the apparent impunity of senior leaders accused of sexual misconduct. They were spurred by reports that two male executives had left the company with substantial pay packages even after the internet search company concluded that claims against them were credible.

A week after the walkout, Google acceded to many of the protestors’ stated demands, including the first item on its list: “An end to Forced Arbitration in cases of harassment and discrimination for all current and future employees”. Google said it would no longer require sexual harassment claims to be settled in front of private arbitrators, a policy that had curtailed employees’ ability to sue the company in open court.

Arbitration clauses have become increasingly pervasive in American life, in everything from contracts for mobile phone service and credit cards to nursing homes, car rentals and employment. They require people to forgo their rights to bring complaints to court and instead settle claims in front of private arbitrators. In many cases, they are also blocked from joining together in collective class action suits. Arbitration clauses are often accompanied by non-disclosure agreements that prevent the processes and outcomes from being made public.

Opponents say forced arbitration hides problems such as sexual harassment, racial discrimination and pay inequity in the workplace and protects companies and executives at the expense of workers with less seniority and power.

“It strikes me as a contradiction — we have companies that are reinventing whole industries and changing how people live their lives and yet they are decades behind in creating welcoming work environments,” says Freada Kapor Klein, a tech investor and diversity activist.

“As tech has consolidated its monopoly power in certain sectors, this is part of consolidating that power. I think it’s emblematic of a larger cultural problem. Despite seeing themselves as progressive when it comes to people issues, technology companies very reflexively just go and hand things over to their lawyers . . . But if you are genuinely committed to creating an inclusive and fair culture, you will not mandate arbitration,” she says.

Google was not the first big US tech group to scrap forced arbitration for harassment complaints. Microsoft dropped the policy a year ago after an accusation that it used the practice to cover up a rape claim and Uber did away with arbitration as part of a broader policy overhaul in May, a move quickly followed by ride-hailing rival Lyft. But Google’s move echoed across Silicon Valley. Facebook quickly followed suit and after reporters began contacting other companies asking about their policies, Airbnb, eBay and Square said they too were moving away from requiring arbitration.

“We have the eyes of many companies looking at us,” said Tanuja Gupta, one of the organisers of the Google protest, the day after the walkout. “We’ve always been a vanguard company, so if we don’t lead the way, nobody else will.”

Walkout: Google employees near Boston, Massachusetts, join a worldwide protest of the company’s sexual harassment policies © Lane Turner/The Boston Globe via Getty Images

Fifty-four per cent of non-unionised, private sector companies in the US require arbitration, up from 7.6 per cent in the mid-1990s, according to a study from the Economic Policy Institute, a think-tank. That means about 60m US workers are subject to such clauses. Large employers with more than 1,000 workers are more likely to mandate arbitration, with 65 per cent requiring the policy, the EPI found. A recent Supreme Court ruling upholding companies’ ability to prevent workers from filing collective or class actions in workplace disputes has strengthened companies’ hands.

“Mandatory arbitration takes advantage of the power imbalance between the company and the employees,” says Kapor Klein.

Employees win cases in arbitration 21 per cent of the time, compared with 36 per cent in federal employment discrimination court cases and 57 per cent in state courts, according to a 2011 study by researchers at Cornell University. Workers who did win in arbitration received lower financial damages awards than those who went to court.

Critics say the message sent by compelling employees to participate in often secretive complaint processes contradicts the perception tech companies have cultivated of being open and fair workplaces — as epitomised by Google’s unofficial motto: “Don’t be evil”.

The Google action followed earlier pushes by tech employees against work their companies were doing for the US government and law enforcement agencies, citing ethical concerns. Google itself had previously pulled out of the running for a major defence contract and did not renew a separate contract with the Pentagon for AI work.

Amazon employees have lobbied their company to stop selling facial recognition software to the police. Workers at Microsoft, Salesforce and other groups have called for an end to contracts with US Immigration and Customs Enforcement given the Trump administration’s policy of separating families crossing the US border.

“People are more engaged than ever before in working with and for companies that share their values,” says Tiffany Vasilchik, chief growth officer at branding agency Landor. “With social media and online platforms, it is easier for employees at large tech companies to organise and come together as one to voice their concerns.”

Lisa Gilbert is vice-president of legislative affairs at Public Citizen, a non-profit consumer advocacy group, which has advocated over forced arbitration. “One of the reasons we have focused on tech companies recently is that a big part of their public personas [is]to be do-gooder companies,” she says. “They are focused on being seen as corporations with a mission.”

Now that workers have won the right to take sexual harassment claims to court, they are pushing for more. Activists at Google and other companies say their employers should drop arbitration requirements for all workplace disputes, including complaints over discrimination.

Employee-driven movements represent challenges for these companies at a time when their power and roles in public life are under increasing scrutiny. For prospective workers considering job offers in tech, the reaction of companies like Google to recent protests underscores a shift in power dynamics that can work in employees’ favour.

“Companies that want the best talent are going to have to step on up these issues . . . I would encourage business school students, especially those with multiple offers, to ask these questions . . . And then to vote with their feet,” says Kapor Klein.

How diverse is the workforce in the large tech companies?

Technology companies long resisted publishing demographic data about their workforces, claiming that doing so would reveal trade secrets. The biggest groups — Apple, Google and Facebook — began publishing diversity reports in 2014 after pressure from activists and their own employees.

Four years later, the companies have shown they have been slow to change. Their workforces are predominantly male and white or Asian, particularly among leadership, their data show.

At Google, 53 per cent of US employees are white and 36 per cent Asian, according to its latest statistics. Globally, 31 per cent are female. At the leadership level, the breakdown in the US is 67 per cent white and 26 per cent Asian; worldwide leadership is 75 per cent male.

At Facebook, 36 per cent of global employees are women; in the US 47 per cent are white and 41 per cent Asian. In leadership that changes to 30 per cent women, 70 per cent white and 22 per cent Asian.

Apple’s most recent data, from 2017, shows 32 per cent of its global workforce is female. In the US, 54 per cent of workers are white and 21 per cent Asian. Twenty-nine per cent of employees in leadership are women, 66 per cent white and 23 per cent Asian.

Tech companies are also coming under pressure to disclose more information about pay levels. A survey this year by the recruitment company Hired found that gaps start in hiring. Male candidates for tech jobs were offered higher salaries for the same roles than their female counterparts 63 per cent of the time, the study found. On average women were offered 4 per cent less.

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