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Understanding The Mandatory Arbitration Ban for Sexual-Harassment Claims

On March 3, 2022, President Biden signed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (the "Act"). On the heels of the #MeToo movement, this new law is a significant workplace reform and a huge step toward changing a system that has used secrecy to protect perpetrators and silence survivors. Our New Jersey employment law team discusses the background of forced arbitration below and how this historic Act will end its use in all cases involving sexual harassment or sexual assault.

Background: What is Forced Arbitration?

"Forced Arbitration" is exactly what it sounds like: Employers in the United States have forced their employees, including employees unlawfully fired, to have their cases decided in private arbitration rather than in court by a jury. Employers have been able to "force" arbitration onto their employees by requiring, as a condition of their getting or keeping a job, that they "agree" to arbitration. We've put "agree" in quotes because employees are not given a choice: you either "agree" or you're fired.

While employers have pushed the lie that arbitration is a faster, cheaper, and better way to resolve disputes, the simple truth is that forced arbitration is rarely good for an employee. Statistics have confirmed that an employee's chances of winning in arbitration are much worse than in court. Moreover, an arbitration proceeding is held in a private, secret proceeding so that other employees and the public never learn about the sexual harassment or assault that has occurred.

The Importance of This Law

As a result of the #MeToo movement, Congress passed and President Biden signed this new law. With its enactment, the law restores employees who claim they have been victims of sexual assault or sexual harassment the right to have their cases decided in court by a jury. As a result, no longer will employers, or the sexual predators who may work for these employers, be able to hide their unlawful conduct in an arbitration hidden from public view.

Specifically, the law voids any arbitration agreement that would require an employee who has been sexually harassed or assaulted to go to arbitration. In cases where there have been multiple sexual harassment or sexual assault victims, the law also allows these employees to bring their claims as class actions. While limited to sexual assault or harassment victims, the new law is an enormous blow against forced arbitration — one that we hope will ultimately lead to a complete ban on forced arbitration agreements.

How We Can Help

We understand that filing a lawsuit against an employer could be intimidating, especially when concerning sensitive matters such as sexual harassment. Our team at Schall & Barasch, LLC has over 50 years of experience fighting for the rights of victims. We will provide you with the legal support and guidance you need and deserve.

If you have been the victim of workplace sexual harassment or sexual assault, contact Schall & Barasch, LLC at (856) 242-8491! We are here to fight for you.