Your arbitration agreement may not protect you as much as you think – here's why

A federal appeals court just handed employers a wake-up call: one harassment claim can void your entire arbitration agreement.

That was the outcome on February 25, 2026, when a federal appeals court ruled that a law firm could not force a former employee to resolve any part of her lawsuit in private arbitration – because she had plausibly alleged workplace sexual harassment. The decision lands squarely on the desk of every HR leader who has ever counted on an arbitration agreement to keep employment disputes out of the courtroom.

The case centered on Randi Marie Bruce, a paralegal who had worked at Adams and Reese, LLP after her practice group transferred to the firm in May 2022. According to the allegations in her complaint, a supervising attorney named Rob Pinson subjected her to a pattern of sexually charged conduct throughout her time at the firm – including repeated suggestions that she visit clients wearing a short skirt, the habitual use of a sexually degrading term directed at her during conversations, and a graphic comment made during a regular workday about a sexual fantasy involving Bruce and another paralegal. She also alleged that Pinson gave her an unsolicited $750 personal bonus and made inappropriate comments about her engagement and relationship after she became engaged in December 2022. The alleged conduct, she claimed, was persistent and ongoing until the day she was fired.

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