What Happened

In a bipartisan testament to the sustained momentum of the #MeToo movement, on February 10, 2022, the U.S. Senate joined with the House of Representatives’ earlier passage of the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (the Act). Recognizing the continued outcry for more transparency related to workplace sexual misconduct, the House Committee on the Judiciary declared the Act’s purpose is to “allow[] survivors to bring their stories out of the shadows and pursue justice in our courts”, and “use their voice however they see fit.”

What It Means

Now awaiting President Biden’s expected signature, the Act will amend the Federal Arbitration Act (FAA) in three meaningful ways:

1. Invalidates employment pre-dispute agreements and class action waivers that require claims related to sexual assault or sexual harassment to be arbitrated on an individual basis;
2. Ensures that the employee who signs an arbitration agreement has complete autonomy in deciding whether to arbitrate sexual harassment or sexual assault claims or choose to pursue such claims, either individually or on a collective basis, in court; and
3. Provides that regardless of the contractual terms of the arbitration agreement, the enforceability of the agreement must be decided by a court, not an arbitrator.

Impact On California Employers

California employers have faced a conundrum since the passage of AB51, which effectively banned imposition on employees and applicants of...

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