On March 3, 2022, President Biden signed into law the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act. Under the new law, employers can no longer compel arbitration of sexual harassment and sexual assault claims. Moreover, the new law requires that courts – not arbitrators – resolve any disputes about whether a claim constitutes sexual harassment or sexual assault, even if a contractual term exists to the contrary.
In matters involving claims of sexual harassment or sexual assault, the law does not invalidate pre-dispute mandatory arbitration provisions outright, but instead offers claimants the option of choosing their preferred forum. While arbitration is not entirely confidential, it is inherently a more confidential process than traditional litigation in court because there is no public record. The new law makes clear that the forum for resolution is the claimant’s choice, acknowledging that some individuals may prefer to resolve disputes in a less public manner than court.
Mandatory arbitration clauses are still enforceable for sex discrimination claims that are unrelated to sexual assault or harassment. The law also does not apply to other, unrelated claims of retaliation or discrimination (such as those based on protected classes such as race, age, religion or national origin).
As a result of the new law, employers should review any current arbitration agreements or class action waivers, and consider updating their agreements for compliance. If you have any questions regarding this information, please contact one of Montgomery Purdue’s employment attorneys, including Sara Campbell or Tammy Roe.