Changes to Federal Law Blocks Forced Arbitration in Sexual Assault and Sexual Harassment Cases
Posted by GibbsGiden Under Labor and Employment
On March 3, 2022, President Biden signed into law the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021, also referred to as House Resolution (“H.R.”) 4445 (the “Act”). The overall purpose of the Act is to prohibit mandatory enforcement of arbitration agreements sexual assault and sexual harassment lawsuits. Instead, the Act gives the employee the option of proceeding with arbitration, if an arbitration agreement exists, or proceeding with claims in court, by amending the Federal Arbitration Act.
The impact of the Act is that cases based on sexual assault or sexual harassment occurring or on or after March 3, 2022 will not be subject to mandatory arbitration, regardless of the date that the employer and employee entered into an arbitration agreement. If the alleged misconduct occurred prior to March 3, 2022, the employer may still compel arbitration based on a valid arbitration agreement. The law also states that courts, not arbitrators, will determine if a claim is covered by the Act if there is a dispute.
The Act does not impact claims that are not related to sexual assault or sexual harassment. That said, the Act is unclear as to situations where a claimant combines sexual assault/harassment claims and non-sexual assault/harassment claims. It remains to be seen if courts will enforce arbitration agreements as to claims not covered by the Act, thereby requiring the parties to litigate in separate forums.
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Matthew Wallin is a senior associate in the Los Angeles office where he practices labor and employment law. He has extensive experience defending private business and public entities in litigation and advising clients on labor compliance issues.
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