Arbitration clauses are commonplace in employment contracts. They typically provide that any and all employment-related disputes must be resolved through binding arbitration, which is often confidential and lacks the transparency and accountability of the court system. Further, arbitrators are typically paid by the employer, which calls into question whether they truly are neutral. For disputes involving allegations of sexual harassment or sexual assault, forced arbitration deprives survivors of an opportunity to be heard and seek justice within a system of checks and balances.
A Big Step Toward Justice
Recognizing the inherent injustice of forced arbitration clauses in that context, Congress recently passed a law that allows survivors of sexual assault or harassment to opt out of binding arbitration clauses. The Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (H.R. 4445) is a big victory for sexual assault and harassment survivors as well as their advocates.
The law is retroactive, which means that employees who signed forced arbitration agreements prior to the law’s passage now have the option to litigate their cases in court. It also applies to class action claims involving allegations of sexual assault or harassment.
Employees who experience sexual harassment or assault in the workplace often feel silenced and disempowered. Forced arbitration clauses are another means of silencing them. In arbitration, the proceedings and perpetrators are shielded from public view – and public scrutiny.
Giving survivors the choice to bring litigation instead of arbitration is a major step toward empowering them.
Who Gets To Decide If The Law Applies?
Employers are bound to challenge the application of the new law, especially in cases where their brand and public image are at stake. Fortunately, the law gives judges – not arbitrators paid for by employers– the power to decide whether the law applies. That means employers can’t hide behind arbitrators in disputing survivors’ right to bring their claim in court.