Ending forced arbitration of sexual harassment, not discrimination

Arbitration agreements are a powerful tool used by many employers as a means of alternative dispute resolution. Arbitration allows the parties of a claim to resolve the dispute privately without the involvement of a court of law. The Federal Arbitration Act (FAA) strongly favors arbitration and allows courts to stay the proceedings of any claims subject to a valid and enforceable arbitration agreement and to compel the parties to binding arbitration.

Background

In March 2022, Congress enacted the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (EFAA). The Act became effective immediately and amended the FAA to specify that victims of sexual assault or harassment can pursue those claims (and related ones) in court, even if they’re bound by an arbitration agreement. Accordingly, as a result of the EFAA, arbitration agreements became unenforceable regarding sexual assault and sexual harassment claims, and such claimants can’t be compelled to arbitrate their claims.