The Changing Landscape of Sexual Harassment Claims and Mandatory Arbitration Agreements
The year 2018 has seen significant shifts in the landscape of gender equality and sexual harassment. Complaints of sexual harassment in California nearly doubled in the first three months of 2018. From January through March 2018, the California Department of Fair Employment and Housing received 939 complaints of sexual harassment. This reflects an increase of 86% in comparison to the same period in 2017.
Against this backdrop, some California companies have recently modified their sexual harassment policies such that employees will no longer be required to resolve such claims in private arbitration. These changes come primarily in response to the #MeToo movement.
Historically, companies have preferred to keep workplace disputes out of the court system and in arbitration. This is because the parties have the ability to mutually agree upon an arbitrator (typically someone with subject matter expertise who may also have handled other matters favorably for the company); arbitration proceedings are generally private; the results are kept confidential; the matter proceeds more expeditiously; and there is a limited ability to appeal.
However, in light of mounting pressure to shine a light on the issue, to prevent serial harassers from continuing to engage in inappropriate and possibly unlawful conduct, and to send a strong message to employees that companies take these matters seriously, more and more California companies are carving out sexual harassment claims from mandatory arbitration proceedings.
Whether more corporations will follow and whether other forms of discrimination or harassment will be encompassed by this growing trend is not yet clear, particularly in light of the recent Epic Systems decision by the United States Supreme Court.