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Effective Immediately, Biden Administration Outlaws Mandatory Arbitration of Sexual Harassment Claims

By June 13th, 2022No Comments

Arbitration agreementBy Janet Hendrick

A direct result of the #MeToo movement, President Biden signed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act into law on March 3, 2022, stopping mandatory arbitration of sexual harassment and assault claims.

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Janet A. Hendrick

The law, which goes into effect immediately, modifies the Federal Arbitration Act, the 1925 statute that allows contracts for binding arbitration between parties including employers and employees, to invalidate predispute mandatory arbitration agreements for individuals who claim they were subject to sexual harassment or assault. The law applies to all contracts – both in the employment context and in other settings.

First introduced in 2017 by Senators Kirsten Gillibrand (D-NY) and Lindsey Graham (R-SC), the current version of the bipartisan bill was introduced in July 2021 and passed the House and Senate in February 2022. Representative Cheri Bustos (D-Illinois), who introduced the House bill, said more than 60 million Americans are subject to workplace arbitration agreements. Gillibrand has called the law “one of the most significant workplace reforms in American history.”  Graham defended the bill in response to pro-business criticism, stating “It does not hurt business to make sure that people who are harassed in the workplace get treated fairly.”

Although the law prohibits requiring individuals to have claims of sexual harassment and assault heard in private arbitration, claimants (whether in the employment context or otherwise) may elect to participate in arbitration rather than have their claims heard in court.  Proponents of the law note the law gives employees and others the choice of where and how to pursue their claims.

The Phillips Murrah Labor & Employment Law team stands ready to advise employers on all aspects of the ever-changing labor and employment laws.

Janet A. Hendrick is an experienced employment litigator who tackles each of her client’s problems with a tailored, results-oriented approach. 

 For more information on this alert and its impact on your business, please call 469.485.7334 or email Janet A. Hendrick.

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