Your company’s arbitration agreements for sexual harassment claims may not survive February intact.

Back in the Summer, during one of my rare deviations from blogging about COVID-19, I slipped in a post about a bipartisan effort in Congress to end the forced arbitration of sexual assault and sexual harassment claims.

Six months later, there are some real signs that this Bill will make it to President Biden’s desk for signature. So, if you have employees that have signed arbitration agreements, keep reading.

Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021

The legislation is called the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021, also known as EFASASHA. Actually, I made that acronym up. Let’s just call it the “Bill.”

The Bill isn’t all that long — just a few pages. Check out the House version here.

Effectively, the Bill says that any arbitration agreement signed before a claim or dispute involving sexual assault or sexual harassment arises is voidable at the option of the individual with the claim.

In plain English, if my employer requires me to sign an arbitration agreement and someone later sexually assaults/harasses me, I can arbitrate my claims if I want. Or I can sue in court under state or federal law or both. It’s entirely up to me.

The Bill also has a similar provision concerning the right to pursue sexual harassment/assault claims in a joint, class, or collective action.

The House passes the Bill.

Last night, the House voted 335-97 to pass the Bill. The House has 222 Democrats and 212 Republicans. So, 335 votes in favor of the Bill qualify as bipartisan support.

Next stop: The Senate

Kate Scanlon at the Washington Examiner reports here that Senate Majority Leader Chuck Schumer said Monday that the Senate might take up the Bill this week.

Ms. Scanlon also notes that the Senate version of the Bill has 10 Republican cosponsors. So, it’s filibuster-proof.

President Biden supports the Bill. So, if the Senate can vote it through, President Biden will sign it.

Employer Takeaways

Should the Bill become law, it will apply to any dispute or claim that arises or accrues on or after the law takes effect. So any pending arbitrations will remain there. Plus, any signed arbitration agreement you have still has some shelf life for future sexual harassment/sexual assault claims until the new law takes effect. After that, your arbitration agreements will still work for other types of employment claims, including claims of sex discrimination that don’t involve unwanted sexual advances, physical contact, comments, or quid pro quo claims.

As an alternative to an arbitration agreement for sexual harassment and sexual assault claims, consider having your employees sign a jury trial waiver instead as a condition of employment. Your mileage may vary — this would not work in New Jersey, for example — and it won’t spare your business the publicity of a public filing. But at least you can avoid a jury verdict.