News & Commentary

February 9, 2023

Miriam Shestack

Miriam Shestack is a student at Harvard Law School.

In today’s News and Commentary: GOP-led states appeal challenge to $15 min wage for federal contractors, mass layoffs at Disney, and Meta must face suit from content moderators in Kenya.

The GOP-led states of Nebraska, Idaho, Indiana, and South Carolina have appealed a January district court ruling that rejected their motion to block President Biden’s $15 minimum wage for federal contractors. Biden directed the US Labor Department to raise federal contractors’ minimum wage to $15 via executive order last April. Judge John J. Tuchi of the US District Court for the District of Arizona dismissed the states’ case on January 6, finding that the states failed to show that the president went beyond his authority when ordering the pay raise for federal contractors, and that the change was not reviewable under the Administrative Procedure Act (APA). The case, Arizona v. Walsh, has been appealed to the Ninth Circuit. As Bloomberg reports, Biden’s minimum wage order is also being challenged in separate federal lawsuits brought by a Texas-led, three-state coalition, as well as by a private recreational company. In the private company’s case, the Tenth Circuit agreed to partially halt enforcement of the policy while the appeal is pending. Arguments were heard in that case in September.

On Wednesday the Walt Disney Co. announced plans W to cut about 4% of its entire workforce. That means layoffs of 7,000 employees. The company’s stock increased immediately after the announcement, which was expected. Returning CEO Bob Iger announced that his goal is to cut more than $5 billion in costs in part by consolidating divisions that make and distribute movies and TV shows. NPR reports that Disney has actually been doing relatively well recently, with profits and revenues up, strong performance from theme parks, and more subscribers on Disney-owned streaming services such as ESPN+ and Hulu. However, the company’s flagship platform, Disney+, lost 2.4 million subscribers in the first quarter of the fiscal year, according to the company’s latest earnings report. Profits from traditional television have dropped across the board, and all of the major streaming services are facing a crisis of profitability, leading to job cuts across the entertainment industry. Commentators have noted that Disney has chosen this time to tease the release of several highly anticipated sequels, including Frozen 3, Zootopia 2, and Toy Story 5. This confluence of events has drawn some accusations of cynical diversion tactics.

Despite the company’s months-long effort to have it dismissed the Kenyan Employment and Labour Relations Court ruled on February 6 that a former content moderator’s case against Meta (formerly Facebook) can move forward. Wired has reported on the case of Daniel Motaung, who worked as a content moderator for Meta in Nairobi, Kenya, through an outsourcing company called Sama. Motaung alleges that he was paid as low as $2.20 per hour to view graphic content that left him with PTSD. He describes the experience as “emotionally and mentally devastating” in a statement shared by the Real Facebook Oversight Board, a group of independent civil rights advocates and experts. While at Sama, Motaung began to push to form a union that would allow moderators to advocate for better pay and more support. However, her was fired six months into the job, prompting him to sue both Sama and Meta.

This case is a first from a content moderator outside the US. Meta (then Facebook) previously reached a settlement of $52 million with US-based moderators who developed PTSD from working for the company. In this case, Meta has argued that it should not be subject to Kenyan law because it is a foreign corporation that does not operate in Kenya. Content moderation work was outsourced to companies like Sama, which directly employed Motaung. The Court disagreed. Cori Crider, of the UK nonprofit Foxglove Legal that has supported Motaung’s case, explained that Motaung’s case could be a blueprint for outsourced moderators in other countries, particularly those that rely on British common law.

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