Biden Signs Bill Ending Forced Pre-Dispute Arbitration

A big day!  In a rare moment of broad bi-partisan support, Congress and the President enacted groundbreaking legislation that will end forced arbitration for workers who are victims of sexual assault and harassment at work.

“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,” Biden said before he signed the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021.

Millions of workers across the U.S. have signed mandatory arbitration agreements which force victims of workplace sexual harassment into confidential arbitration forums, with no right to appeal.  This has allowed harassment to continue virtually unabated, as these private venues often favored alleged perpetrators, and their confidentiality prohibits other victims from learning they are not alone.

The new law prohibits those pre-dispute agreements, by amending the Federal Arbitration Act to invalidate contract provisions that mandate pre-dispute arbitration. It also forbids employers from requiring employees to waive their right to bring class or collective actions in cases involving sexual harassment.  In other words, employees and employers can still choose private arbitration, but only after the dispute, and then only if everyone agrees.

This has been a big win for business, too, many of whom have worked hard to rid their ranks of harassers, as the playing field will now be level against competitors who refused to devote the resources to uncovering and eliminating sexual harassment.

While not as comprehensive as recent laws in New York, California and New Jersey, all of which prohibit use of pre-dispute waivers for any employment related claims for discrimination, harassment or retaliation, this new Federal law brings the Federal Arbitration Act a long way, and creates a path to relief for victims of sexual harassment, many of whom have suffered in silence far too long.

“President Biden has long spoken against forced arbitration clauses in employment contracts and today marks an important milestone in empowering survivors of sexual assault and sexual harassment and protecting employee rights,” White House press secretary Jen Psaki said during a press briefing Thursday.

On behalf of our firm, and many of our clients who have suffered so long in silence, we applaud Congress and the President on this historic moment.