On March 3, 2022 the President signed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021. This new law – which went into effect upon signing – permits an employee to forgo arbitration for claims of sexual harassment or assault, even if the employee agreed to binding arbitration of those claims in his or her employment contract. Employees are still free to choose to arbitrate sexual harassment or assault claims after a dispute arises, but they are no longer bound by pre-dispute arbitration clauses.
The law applies only to claims that arose on or after March 3, 2022. The law also voids any clause requiring mandatory arbitration of sexual harassment or assault claims in contracts executed on or after March 3rd. Keep in mind that this applies only to claims of sexual harassment and assault; assuming the rest of the arbitration clause is valid, any other claims must be resolved through arbitration. The law further applies to consumer contracts, giving those harassed or assaulted on cruise ships, in hotels, or during a trip booked through a ridesharing company an alternative path of recourse.
Employers can no longer rely on an arbitration clause to shield them from jury verdicts for workplace sexual harassment and assault. Employees should review their contracts and handbooks to ascertain whether mandatory arbitration is part of their employment. Whether you are an employer seeking to revise your standard contracts or policies or an employee who has experienced sexual harassment or assault in the workplace or as a passenger or guest, we can help. Feel free to reach out to us for a consultation or call our office at (757) 995-5606.