April 4, 2022
Morgan T. Dilks
On March 3, 2022, President Biden signed into law the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (the “Act”). The Act amends the Federal Arbitration Act and gives individuals asserting claims of sexual assault or sexual harassment under federal, state or tribal law the option to bring those claims in court even if they had previously agreed to arbitration.
With the enactment of this legislation, individuals bringing sexual assault and sexual harassment claims who entered into predispute arbitration agreements or predispute class-action or collective-action waivers(sometimes seen in company policies and procedures) may no longer be bound by those agreements, instead making enforceability “at the election of the person alleging [the] conduct.” In other words, a claimant can still move forward with arbitration, they are simply no longer forced to move forward with arbitration. Instead, an individual who entered into a predispute arbitration agreement who is bringing a sexual harassment claim or a sexual assault claim can elect to do so in the appropriate federal, state, or tribal court.
It is worth noting that individuals can still enter into enforceable arbitration agreements or class-action/collective-action waivers with respect to sexual harassment and sexual assault claims after the claims arise.
The appropriate court, not an arbitrator, has the power to determine whether the Act applies and whether the agreement requiring arbitration of predispute sexual assault or sexual harassment claims is enforceable. At this stage, employers are not required to amend or replace existing arbitration waiver agreements. Nor are employers required to remove sexual assault or sexual harassment claims from their arbitration waiver agreements moving forward. Employers must simply be aware that despite what may have been included in a predispute arbitration agreement, complainants now have the choice of forum. Aspects of the Act will surely be challenged in court as unique issues arise. In the meantime, employers should consult with legal counsel regarding the terms of their predispute arbitration agreements, and whether those agreements should be revised in light of the Act.
Here at RKW, we stand ready to help guide employers and offer advice and insight on these complex issues. For questions about this new law, contact Morgan Dilks at MDilks@RKWlawgroup.com
© 2023 RKW, LLC. All Rights Reserved.Sign up for our weekly newsletter