Bill Banning Forced Arbitration of Harassment Claims Heads to Biden's Desk

Workers' rights advocates on Thursday applauded the U.S. Senate's passage of a bill to keep workplace sexual harassment victims from being forced into private litigation of their claims rather than taking them to court--a reform called "long overdue."

"The arbitration process not only allows the corporations to hide sexual harassment and assault cases in this secretive and often biased process, but it shields those who committed serious misconduct from the public eye."

Three days after passing in the House with a 335-97 vote, the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act was passed by the Senate in a voice vote and was expected to be signed by President Joe Biden, who has said he supports the legislation.

The bill will bring about "one of the most significant workplace reforms in the last 50 years," lead sponsor Sen. Kirsten Gillibrand (D-N.Y.) said, noting that an estimated 60 million workers have signed mandatory arbitration agreements at work--many without realizing what they are agreeing to.

Forced arbitration clauses in employment contracts bar employees from suing their companies in court over allegations of sexual harassment or abuse, requiring them to settle claims privately. People who sign are also often barred from talking about their experiences, preventing employees from finding out if their colleagues have also faced harassment or abuse.

Several U.S. Supreme Court decisions in recent decades have made forced arbitration more common. In 2001, the court ruled that workers engaged in interstate or foreign commerce can be forced into arbitration, amending the Federal Arbitration Act on 1925, which had explicitly exempted these employees. In a 2011 case involving AT&T, the court ruled that companies can insert a clause into arbitration contracts that would ban class action lawsuits.

The legislation "will help us fix a broken system that protects perpetrators and corporations and end the days of silencing survivors," Gillibrand said. "The arbitration process not only allows the corporations to hide sexual harassment and assault cases in this secretive and often biased process, but it shields those who committed serious misconduct from the public eye."

The median award for a plaintiff in a private arbitration case is $30,000 versus $217,000 in a case that goes to court, according to news outlet The 19th.

The bill will apply not only to future employment contracts but will also be retroactive, said Senate Majority Leader Chuck Schumer (D-N.Y.), nullifying forced arbitration agreements that have already been signed and potentially allowing many workers to hold their employers accountable for past workplace abuse.

Forced arbitration clauses gained national attention in 2017 as a result of the #MeToo movement.

The legislation was passed with strong bipartisan support, with Sens. Lindsey Graham (R-S.C.) and Dick Durbin (D-Ill.) joining Gillibrand as cosponsors. In the House, Rep. Pramila Jayapal (D-Wash.) was among the lawmakers to introduce the bill.

All votes against the legislation in the House were from Republicans.

"This is great news for workers everywhere!" tweeted women's rights group UltraViolet after the bill was sent to Biden's desk Thursday. "Ending forced arbitration will prevent the silencing of workplace survivors."

While welcoming the measure as a "crucial first step," Emily Martin, vice president for education and workplace justice at the National Women's Law Center, called it "admittedly an incomplete solution, as no one should be forced to waive their ability to fully enforce their rights to be free from other forms of unlawful harassment, discrimination, and exploitation, whether as workers, as consumers, as patients, or as students."

"We urge Congress to continue to build on today's important progress," she said.