Employers commonly include mandatory arbitration clauses in their employees’ employment contracts, which prevent their employees from filing employment related claims in court. While these clauses are often touted as promoting efficiency, they have come under fire in recent years, especially in light of the #MeToo movement. Forced arbitration clauses are typically criticized on the grounds that they prevent sexual harassment allegations from being made public, employees are less likely to win at arbitration, and successful employees are often awarded smaller amounts than they could get at trial. In response to these criticisms, Congress recently passed the “Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act” (commonly referred to as the #MeToo Law), which will give employees with sexual assault and harassment claims the option to invalidate mandatory arbitrations clauses in their contracts, as it pertains to those specific claims. President Biden is expected to soon sign the bill into law.
The bill was introduced by Rep. Cheri Bustos of Illinois and was championed by FOX news anchor Gretchen Carlson, who attempted to sue then-CEO Roger Ailes, only to learn that her employment contract had a mandatory arbitration clause.
Although the bill has been heralded as a major victory for employees and the #MeToo movement, some have expressed concerns about how the law might negatively impact employees with multiple claims against their employers. In such cases, although the claims related to sexual harassment will be able to proceed to court, the employee might still be forced to arbitrate the remaining claims. Some fear that if an employee is not permitted to take all of their claims to court, they will be stuck in the costly, time-consuming, and inefficient position of having to fight for their rights in two different forums.