House Passes Bill Banning Mandatory Arbitration of Sexual Assault and Harassment Claims

UPDATE: The Senate passed the bill on February 10 by a voice vote, so it now heads to President Biden's desk for his signature.

Author: David B. Weisenfeld

February 8, 2022

The House of Representatives passed a bipartisan bill yesterday to eliminate the use of mandatory arbitration clauses in cases of sexual assault and sexual harassment. The measure passed by a 335-97 vote, including a majority of Republican representatives.

The Senate is scheduled to take up the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act later this week, and with at least 10 Republicans having co-sponsored the legislation it is expected to pass overwhelmingly and be signed by President Biden.

The bill came about in direct response to the #MeToo movement. The Supreme Court has consistently upheld mandatory arbitration agreements as a condition of employment and many employers make use of them, but former Fox News anchor Gretchen Carlson led growing calls that the use of such agreements is unfair. Carlson brought a sexual harassment case against her former boss Roger Ailes that settled for $20 million.

Speaking at a Society for Human Resource Management (SHRM) Conference in late 2021, Carlson said that secrecy abounds with mandatory arbitration agreements because they typically restrict sexual harassment victims from speaking out.

"That's problematic when there is a predator in the workplace," said Carlson, who also noted, "The deck is stacked against employees [with such agreements]. Arbitrators are not a jury of your peers."

It is estimated that more than 60 million US employees are subject to mandatory arbitration clauses. Proponents of the bill, including Carlson, claim these clauses are often listed in fine print, leaving many workers unaware they have signed them.

"This bill is one of the most significant workplace reforms in American history and is a major step forward toward changing a system that uses secrecy to protect perpetrators and silence survivors," said New York Sen. Kirsten Gillibrand, a co-sponsor of the legislation. "It will give survivors their day in court, allow them to discuss their cases publicly and end the days of institutional protection for harassers."

The US Chamber of Commerce opposes this legislation, claiming it is overly broad. But the Chamber has voiced support for a separate measure that would establish a series of criteria that must be met before voiding a mandatory arbitration agreement.