In a rare show of bipartisanship, the U.S. Senate has just passed legislation arising out of the #MeToo movement that guarantees the victims of workplace sexual harassment or assault the ability to pursue litigation against their employers in court, as opposed to arbitration.
The bill, which made its way through the Senate on Thursday (February 10) after previously being passed by the U.S House of Representatives, now heads to the desk of President Joe Biden for signature. Of note, he supports the legislation, which the White House says, “advances efforts to prevent and address sexual harassment and sexual assault, strengthen rights, protect victims, and promote access to justice.”
Essentially, the new law will prohibit provisions in employment contracts that require third-party arbitration of workplace sexual harassment or assault claims. Once signed, the legislation will amend the Federal Arbitration Act, effectively banning agreements mandating arbitration in these instances. Of note, the bill is retroactive, voiding any mandatory arbitration clauses in contracts that have already been signed by employees. That being said, arbitration of these claims is permissible if the employee elects that method of dispute resolution.
It is important to emphasize the legislation is narrowly written, focusing only on sexual assault and harassment claims. As such, the law should not have the unintended effect of nullifying arbitration agreements in all employment contracts.
In the wake of this significant workplace development, employers should revisit their employment contracts and address conflicting language in existing arbitration provisions. Of course, the employment team at Michelman & Robinson, LLP is available to answer any related questions you may have.
This blog post is not offered, and should not be relied on, as legal advice. You should consult an attorney for advice in specific situations.