February 7, 2023

Volume XIII, Number 38

Advertisement

February 06, 2023

Subscribe to Latest Legal News and Analysis

President Biden Signed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021

On March 3, 2022, President Biden, as expected, signed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (“Act”) into law. As we previously explained, the Act amends the Federal Arbitration Act (FAA) to make pre-dispute arbitration agreements for sexual assault and sexual harassment claims invalid and unenforceable. Parties remain free, however, to mutually agree to arbitration after a claim has been asserted. The new law delegates any disputes regarding the Act, including as to the arbitrability of claims, to the courts, and not an arbitrator, to decide.

While the amendment to the FAA appears limited, the Act’s application in a lawsuit with several claims that are potentially interrelated may present procedural and practical challenges.  For instance, employment lawsuits alleging sexual harassment may also include derivative claims alleging discrimination and retaliation, or other employment-related claims. Some claims might be asserted only against the defendant company, while others might be asserted against individuals as well.  Under the Act, the sexual harassment claim may have to be litigated in court, but the other claims potentially could proceed in arbitration pursuant to a valid arbitration agreement. Under such a scenario, employers would need to decide whether to permit all claims to proceed to court or whether to split the claims between the two forums.  In such cases, where parties disagree, courts would need to decide which claims must be litigated and which, if any, may be arbitrated.  If split, the court might also need to determine, among other things, the order of proceedings and whether to stay proceedings for one set of claims pending the outcome of the other.   How this will play out as a practical matter will likely depend upon the particular circumstances of each case.

Going forward, employers that include arbitration clauses in their employment agreements should update their agreements as necessary to ensure that they comport with the Act.

©2023 Epstein Becker & Green, P.C. All rights reserved.National Law Review, Volume XII, Number 67
Advertisement
Advertisement
Advertisement

About this Author

Member of the Firm

Employers across industries turn to seasoned litigator Emily Patajo to represent them in high-value employment matters in state and federal courts, and in binding arbitration. She is routinely involved in the risk assessment and defense of matters concerning claims of wrongful termination and unlawful discrimination, harassment, and retaliation in violation of the California Fair Employment and Housing Act (FEHA). Clients also rely on Emily to advise them on wage and hour and class action cases and to represent them in labor arbitrations.

In...

310-557-9591
Advertisement
Advertisement
Advertisement