Mandatory Arbitration of Sex Harassment Claims Now Illegal

Mandatory Arbitration of Sex Harassment Claims Now Illegal

President Joe Biden signed a bipartisan bill into law on Feb. 24 blocking employers from making workers arbitrate sexual harassment and assault claims, a move one lawmaker said will affect 60 million Americans currently bound by workplace arbitration pacts.

The Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act, known also as H.R. 4445, was passed by voice vote in the Senate on Feb.10, just days after the House passed it by a 335-97 vote.

At the signing ceremony, Biden stated “When it comes to sexual harassment and assault, forced arbitration shielded perpetrators and silenced survivors, enable employers to sweep episodes of sexual assault harassment under the rug. And it kept survivors from knowing if others have experienced the same thing, in the same workplace, at the hands of the same person. And yes, there will be cases where victims want their claims resolved in private. But some survivors will want their day in court, and that should be their choice and nobody else’s choice.”

The law is set to modify the Federal Arbitration Act by invalidating predispute mandatory arbitration agreements for workers who claim they were subjected to sexual harassment or assault. Proponents of the bill have said the legislation gives employees the ability to choose where and how they pursue such claims.

Vice President Kamala Harris, who was at Thursday's signing, praised the bipartisan group of lawmakers who worked on the legislation and emphasized the Biden administration's commitment to workers' rights.

"These leaders, they saw clearly this is not a partisan issue. This is not about Republicans or Democrats. This is about right and wrong. As I think about the future, our administration will work with Congress on broader forced arbitration legislation. And we will do that to also protect the rights of workers in cases of wage theft, racial discrimination and unfair labor practices," she said.

Biden also noted he wants to "strengthen and renew" the Violence Against Women Act and address nondisclosure agreements he said keep employees from speaking up about misconduct.

Rep. Cheri Bustos, D-Ill., introduced the House bill in July, and its initial co-sponsors were Reps. Morgan Griffith, R-Va., Pramila Jayapal, D-Wash., and David Cicilline, D-R.I. At the time of its passage in the House, the bill had 17 Democratic and eight Republican lawmakers co-sponsoring it.

Sen. Kirsten Gillibrand, D-N.Y., introduced an iteration of the bill, co-sponsored by Sens. Lindsey Graham, R-S.C., and Richard Durbin, D-Ill., in July.

Bustos joined House Speaker Nancy Pelosi, D-Calif., for an enrollment ceremony Wednesday to officially pass the bill along to the White House.

"While I am so excited to join the president as this bill is signed into law, I'm even more eager for the survivors of sexual assault and sexual harassment across the country, who will finally be freed from silence by the stroke of a pen," Bustos said in a statement Wednesday. "This bill will help us end the days when a legal technicality hidden in employment paperwork or terms and conditions can protect sexual abusers and rapists."

She also noted the wide reach of the law, saying that 60 million Americans would be touched by the law's invalidation of such agreements in their employment contracts.

But since the law applies to all contracts — not just employment agreements — it will also prevent sexual misconduct victims from being forced into arbitration agreements in other scenarios, such as "in nursing homes, property leases, ride-share apps, movers, handyman services and more," Bustos said.

The law, which one expert called "the most significant arbitration-related law in recent memory," will take effect immediately, according to a spokesperson for Bustos.

Former Fox News host Gretchen Carlson, whom lawmakers have credited with helping shepherd the bill toward a rare showing of bipartisan support, was also present for the signing Thursday.

Carlson signed an arbitration contract but in 2016 sued Fox head Roger Ailes alleging sexual harassment anyway; he resigned weeks later and died the following year. The parties reached a settlement reportedly at $20 million in 2016.

Carlson has since been outspoken about arbitration clauses in employment contracts, saying they muzzle survivors of sexual misconduct.

"It's such an honor for me to be here today, a culmination of a five-year journey of hard work and perseverance. An historic day that proves that both parties can come together to get something good done. I can't think of a better way to kick off Women's History Month than by signing a bill that will make the workplace safer for millions of women," Carlson said.

She added that the law is good news for employers, too.

"I also believe that this law will have a dual effect. It's going to help companies get on the right side of history and be more transparent, but I believe it's also going to stop the bad behavior. Because now everyone will know that women's voices can be heard," she said.

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