Potential Impact of Splitting Disputes
The act’s broad net may result in collateral litigation over its meaning and scope. Other claims, such as gender or age discrimination, that are sometimes part of a larger complaint by an aggrieved victim could trigger additional litigation. “It is unclear whether a plaintiff can force those other claims into court by accompanying them with a claim of sexual harassment or assault. The act allows an alleged victim to avoid arbitrating any ‘case’ that ‘relates to’ a sexual harassment or assault dispute, and not just the dispute itself,” explains Henry R. Chalmers, Atlanta, GA, cochair of the Litigation Section’s Alternative Dispute Resolution Committee.
Additionally, a claimant must also now strategically evaluate whether to pursue sexual harassment claims in one forum (arbitration) and non-harassment claims in a second one (state, federal, or tribal courts). Pursuing related, and perhaps overlapping claims, simultaneously in two forums could result in inconsistent or even conflicting factual or legal findings. But by prohibiting mandatory arbitration, the act now gives victims of sexual misconduct the ability to choose the best venue—or venues—when making their strategic decisions.
Promoting Justice for Aggrieved Victims
In a February 2022 Statement of Administration Policy, the Office of Management and Budget stated that “[t]his legislation advances efforts to prevent and address sexual harassment and sexual assault, strengthen rights, protect victims, and promote access to justice.” This goal is reflected in the act’s expansive definitions of “sexual harassment disputes” and “sexual assault disputes.”
The act defines a sexual harassment dispute as one “relating to conduct that is alleged to constitute sexual harassment under applicable Federal, Tribal, or State law.” Under federal law, “sexual harassment” is broadly defined to include “unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct” when submission to such conduct is a term or condition of an individual’s employment, is the basis for employment decisions, or creates an intimidating, hostile, or offensive working environment. Presumably, courts will use similarly expansive concepts of sexual harassment when considering claims that arise outside the employment context
The act similarly defines a sexual assault dispute as one “involving a nonconsensual sexual act or sexual contact,” as such terms are defined under federal, state, or tribal law, and specifically includes circumstances in which the victim lacks the capacity to consent. Federal law defines “nonconsensual sexual act” and “sexual contact” as the “intentional touching, either directly or through the clothing, of [the private areas] of any person with an intent to abuse, humiliate, harass, degrade, or arouse or gratify the sexual desire of any person.”
Section leaders predict that the legislative grant of autonomy to sexual misconduct victims will ensure they have the opportunity to be fairly and justly heard—be it through arbitration they agree to, or in a state, federal, or tribal court as guaranteed by the act. “The most important objective is to ensure that victims can maintain their voice and sense of agency over actions taken against them,” stresses Rachel Pereira, Washington, DC, cochair of the Section’s Access to Justice Committee. “The statute was drafted purposefully to leave that decision up to the alleged victim,” Chalmers notes.
Impact on Existing Agreements and Corporate Policies
The act does not require any party to change, redraft, or even edit its current arbitration, class action, or collective-action waiver agreements. “Such agreements are rendered invalid only if the alleged victims elect to invalidate them. If alleged victims want to force compliance with mandatory arbitration agreements, their alleged perpetrators have no choice but to arbitrate,” reiterates Chalmers.
Employers are still beholden to applicable state laws regarding arbitration of employment-based and other claims, observes William E. Weinberger, Los Angeles, CA, cochair of the Section’s Corporate Counsel Committee. The act is likely to incentivize employers to review and revise policies and practices that focus on sexual assault and harassment in the workplace. “The risk that, as written, the law could draw into its ambit cases in which the plaintiff has alleged sexual harassment and other employment claims not related to sexual harassment will be added incentive for employers to strengthen those policies and practices,” Weinberger adds.
New corporate awareness may also bleed into updates to internal company policies and workplace conditions. “Certainly employers will now have to address these incidents completely and engage in high-quality prevention to ensure that work spaces are safe for all,” states Pereira. Employers will likely change the way they address the underlying practices for the better to try to eliminate sexual harassment or sexual assault in their workplace, Pereira predicts.
The act may also motivate employers to address unsafe work environments in order to avoid the increased public attention on such cases. “It may provide a mechanism to ensure that employers understand the severity of such harm and take action to address and prevent [unsafe work environments],” Pereira posits. “The ability of employers to keep sexual harassment and sexual assault claims out of the limelight, which had already been eroded by some state laws, particularly in California, is further impeded by this law,” Weinberger agrees.
Making Room for Additional Reform?
Although the act creates a judicial safe haven for claims of sexual harassment and assault, Section leaders see room for similar protections for claims arising from other forms of discrimination and misconduct. “Hopefully, similar amendments will eventually extend to all forms of workplace discrimination, in an effort to give victims of discrimination a voice and ensure that employers do more to eliminate all forms of workplace discrimination,” urges Pereira.