President Biden has signed into law H.R. 4445, the “Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021. ”
The new law, if upheld by the courts, would invalidate all pre-dispute arbitration agreements that preclude a party from filing a lawsuit in court involving sexual assault or sexual harassment, at the sole election of the party alleging such unlawful conduct.
Such agreements are often a condition of employment, and can be found even in job application forms. In contrast to court proceedings, arbitration trials are conducted in private without juries, and are presided over by one or more specially trained private arbitrators (not always lawyers) instead of judges.
Under the new law, employees can sue in court with their own legal representation, but they still have the arbitration option available if they choose. “It should be their choice and nobody else’s choice,” President Biden said.
Although the new law amends existing federal statutes (Title 9 of the United States Code, which outlines the role of arbitration in federal law), it seeks to be applied with respect to every case “which is filed under Federal, Tribal, or State law.”
Despite roughly 60 million workers being subject to forced arbitration provisions at their place of employment in the United States, only 82 employees won a monetary award in forced arbitration in 2020, according to the American Association for Justice.
Among the large American corporations that rely heavily on mandatory arbitration agreements in their workplaces are Family Dollar, AT&T, American Express, Citibank, Chipotle, Macy’s, and Charter Communications.
According to Vice President Harris, the new law will make the nation’s workplaces “more safe and more just.”
“Forced arbitration silences survivors of sexual assault and harassment,” she said. “It shields predators instead of holding them accountable, and gives corporations a powerful tool to hide abuse and misconduct. And it compels the people of our nation — and most often the women of our nation — to sign away one of their most fundamental rights: the right to seek justice in court.”
The legislation signed by President Biden purports to end forced arbitration in all cases of alleged sexual abuse. The new law is to apply with respect to any dispute or claim that arises or accrues on or after its date of enactment (March 3, 2022).
The Vice President was one of the sponsors of the legislation five years ago when she was a U.S. Senator from California.
“Our administration will work with Congress on broader forced arbitration legislation to also protect the rights of workers in cases of wage theft, racial discrimination, and unfair labor practices.”
The Senate passed the bill last month by voice vote, indicating no opposition. The House passed the measure 335-97.
Speaking at the White House signing ceremony was one of the bill’s longtime champions, Gretchen Carlson, the former Fox News host, who started an advocacy group pushing for corporate change after she sued former Fox News CEO and Chairman Roger Ailes. Fox settled the sexual harassment case for $20-million.
Carlson said the new law will “make the workplace safer for millions of women” and proves that “both parties can come together to get something good done.”
