#MeToo Breaks Silence, Legislators Follow: Arbitration Agreements

Originally published by Meredith L. Kaufman.

The use of mandatory employment arbitration agreements has long been the subject of debate, but the controversy has intensified since the inception of the #MeToo movement. Some legislators believe that mandatory arbitration of sexual harassment claims silences harassment victims and perpetuates harassment.

• At the federal level, in December 2017, a bipartisan group of lawmakers led by Sen. Kristen Gillibrand (NY) introduced a bill in the Senate called the “Ending Forced Arbitration of Sexual Harassment Act,” which would prohibit mandatory arbitration of sexual harassment claims, while leaving other claims subject to arbitration agreements. Last month, it received significant support when the National Association of Attorneys General (NAAG) sent a letter to leaders in Congress, urging the passage of the legislation. 56 attorneys general of the United States, the District of Columbia, Puerto Rico, the Northern Mariana Islands, American Samoa, Guam, and the Virgin Islands called on Congress to allow victims of workplace sexual harassment claims to have their days in court and be afforded the “procedural and substantive due process” that comes with proceeding with a lawsuit. The bill is currently pending before the Senate Health, Education, Labor, and Pensions Committee.
• In early January, New York Andrew Cuomo unveiled a series of proposed new laws to be considered as part of the state budget that would also void forced arbitration policies that prevent sexual harassment cases from being brought in court. On March 12, the Republican-led state Senate passed legislation (SB S7848A) which, among other things, bans mandatory sexual harassment arbitration clauses. Democrats say the proposal doesn’t go far enough. The bill will now be sent to the state Assembly.

It remains to be seen whether eliminating mandatory arbitration of sexual harassment claims would actually have the desired effect. Proponents believe that victims would prefer to have harassment claims litigated in public. However, some victims of sexual harassment are averse to this kind of attention for a variety of reasons, and mutual arbitration agreements allow those individuals to seek remedies to the fullest extent of the law without filing a public complaint. However, some argue that secrecy around sexual harassment and its consequences has only perpetuated harassment, and the recent sharing of experiences has helped uncover long-hidden stories of harassment.

We will continue to monitor legislative developments on this front and keep you posted. In the meantime, employers with mandatory arbitration policies should be prepared for such agreements to be potentially void as to sexual harassment claims in the near future. Up next, we’ll look at legislative efforts to eliminate confidentiality provisions in the settlement of sexual harassment claims.

For more information, please contact your Baker McKenzie lawyer.

Curated by Texas Bar Today. Follow us on Twitter @texasbartoday.

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