In some employee contracts, there is a clause that addresses how two parties will resolve any future dispute. It is not uncommon for there to be a clause that states that any sexual assault or sexual harassment accusation will go through arbitration. The last few years of the #MeToo movement have gotten the ball rolling to change this policy.
Recently, the Senate passed a bill that ends forced arbitration for these accusations. Instead, victims can now file a lawsuit against their employers, and it is a significant workplace reform.
Effects of arbitration
Arbitration is not an uncommon dispute resolution method, especially when it comes to business disputes. However, CBS News discusses why mandatory arbitration for sexual harassment and sexual assault cases is unfair for the victims.
Many employees are not even aware they signed a mandatory arbitration clause, because the contract is so detailed, and the provisions are often in fine print. Forced arbitration clauses generally benefit employers and corporations. There is sometimes a bias to the process, and it allows companies to hide sexual assault and sexual harassment cases and shield the perpetrators. It also often results in companies paying out smaller settlements to the victims.
Immediate impact of the new Act
The Washington Post outlines how this act, known as the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act, will affect victims going forward. Employees are now able to sue their perpetrators in court, even if their original employee contract has a forced arbitration clause in it. This Act nullifies all former agreements relating to sexual harassment and sexual assault. The only exception is disputes that are currently going through the arbitration process.