On March 3, 2022, President Biden signed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021, which limits the use of mandatory employment arbitration agreements. Previously, under Federal Arbitration Act, employers could require employees to submit most claims against their employers to arbitration by using a valid arbitration agreement.
Before signing the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021, President Biden said “forced arbitration shielded perpetrators and silenced survivors, enabled employers to sweep episodes of sexual assault and harassment under the rug, and kept survivors from knowing if others have experienced the same thing.”
The new law amends the Federal Arbitration Act to create an exemption for sexual harassment and sexual assault claims. Persons with such claims may bring an action in court notwithstanding an arbitration agreement to the contrary. With this new law, much remains uncertain, such as what the law will apply if the employee has multiple causes of action, only one of which is sexual harassment or assault, or how claims of retaliation will be treated if they arise from claims of sexual harassment or sexual assault.
Employers are not required to update their existing arbitration agreements, but should note that going forward, this agreement will not be enforceable against employees who claim to have been sexually harassed or assaulted.
The new law is effective immediately and applies to all claims arising on or after March 3, 2022.
Please note that the information provided on this website is for general information purposes only and is not to be construed nor relied upon as legal advice nor the formation of an attorney-client relationship. For a free consultation with Attorney Thomas M. Lee, please contact us.
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