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Biden Signs Bill Ending Forced Arbitration for Employees’ Sexual Harassment and Sexual Assault Claims

On March 3, 2022, President Biden signed into law the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act. The Act amends federal law to make forced arbitration agreements unenforceable for any claims related to sexual assault or sexual harassment. Until now, employees who have suffered sexual abuses in the workplace have often been forced to bring their claims in arbitration, which favors the employer and keeps the illegal behavior of harassers – and those who enable them — hidden from other employees and the general public. This change will allow employees who have suffered sexual assault and harassment in the workplace to seek justice in court even if their employer previously made them sign a pre-dispute arbitration agreement.

Unfortunately, roughly 60 million employees in the United States are bound by forced arbitration agreements. Arbitration is a private system that forces individuals with legal claims to have their disputes heard and decided by private individuals in a confidential manner, rather than through the public judicial system.  These agreements bar employees from bringing legal claims in state or federal court, provide almost no opportunity for appeal if the arbitrator gets it wrong, and usually prohibit employees from joining together and bringing their case as a group or in a class action. Arbitrators function as private judges, but they are often hired and paid by the employer, creating an incentive for the arbitrator to rule in the employer’s favor. Arbitration was not contemplated for employment settings when the Federal Arbitration Act was enacted almost a century ago, but in recent years the Supreme Court has interpreted the law to require arbitration of employment claims in most instances even where employers have required “agreement” to arbitrate as a condition of employment.

The new law amends the Federal Arbitration Act to exclude from forced arbitration claims related to sexual assault and sexual harassment. It applies to any kind of contract, but it will likely have the biggest impact on employees due to the prevalence of forced arbitration in employment contracts. This law enables an employee to bring claims of sexual assault or sexual harassment in court, even if the employer required the employee to enter into a forced arbitration agreement. Employees can also bring group or class actions for sexual assault and sexual harassment claims. Targets of workplace sexual harassment or sexual assault will now be free to challenge unlawful behavior in court.

This forced arbitration reform was first introduced in Congress in 2017 amid the #MeToo movement, which shed new light into the secrecy surrounding workplace sexual abuse and exposed employers’ efforts to keep misconduct allegations private, including through arbitration. Fox News anchor Gretchen Carlson’s case helped garner bipartisan support for the bill. In 2016, Ms. Carlson sued Roger Ailes for sexual harassment after a forced arbitration clause prevented her from suing her employer, Fox News, in court. The most recent version introduced by Senators Kirsten Gillibrand and Lindsey Graham received bipartisan support in both the Senate and the House of Representatives when it passed on February 10.

With this change, employees who experience sexual harassment and sexual assault can make their case to a judge. Just as importantly, their claims will not be confined to the secrecy of the arbitration process. Survivors will better able to shine light into patterns of mistreatment and, hopefully, prevent future harm.

Correia & Puth represents employees confronting sexual assault, sex discrimination, and sexual harassment in the workplace. If you have experienced sexual harassment or other forms of workplace discrimination, please contact us today.

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