Home>Law, Small Business>What does the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 Mean for Sexual Assault and Sexual Harassment Survivors and for Employers?
What does the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 Mean for Sexual Assault and Sexual Harassment Survivors and for Employers?
Ending Forced Arbitration
The Act allows a survivor of sexual assault and sexual harassment to file their claim in court instead of being forced into mandatory arbitration. The Act also prohibits agreements that waive an employee’s right to partake in a joint, class, or collective action in other forums relating to disputes of sexual assault or sexual harassment. Vice President Kamala Harris stated, “[f]orced arbitration silences survivors of sexual assault and sexual harassment” …”[i]t shields predators instead of holding them accountable and gives corporations a powerful tool to hide abuse and misconduct.”
Here are the highlights of the Act:
Survivors are no longer forced to arbitrate—plaintiffs get to choose to file in court, but still have the option to arbitrate, if they wish.
The Act is retroactive, so even if an agreement or contract was signed in the past that restricted the claims to mandatory arbitration, those clauses are no longer valid or enforceable.
Any prior agreement signed that included a clause waiving a survivor’s right to partake in class-action lawsuits is no longer valid or enforceable. The survivor gets to choose whether they want to bring a lawsuit individually or participate in a class-action lawsuit.
If there is any dispute regarding the applicability of the Act, a federal judge will decide if the Act applies. Typically, the contract provisions included a clause that any dispute about the mandatory arbitration applicability would be decided by an arbitrator.
The Act is not limited to employment law—it also potentially covers clients, customers, patients, and consumers. This broadens the Act’s coverage because services, such as ridesharing apps, require the customer to agree to the terms and conditions (that very few read), which typically include mandatory arbitration clauses relating to claims of sexual harassment or sexual assault.
What does this mean for employers? Employers should review their contracts if they include mandatory arbitration clauses and make appropriate revisions to be compliant with the Act. Employers should note that the Act was in effect immediately and is retroactive to any agreements signed prior to the Act. A survivor can still voluntarily agree to arbitrate their claims but cannot be forced to do so. The survivor gets to choose.