Biden signs law ending mandatory arbitration of sexual harassment cases
By Perry MacLennan, Haynsworth Sinkler Boyd, P.A.
President Biden has signed into law the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021. The law prohibits employers from including mandatory arbitration clauses in employee handbooks, offer letters, and contracts that would apply to claims of sexual harassment or assault.
A few key things to note:
- The law is retroactive in the sense that if an employee has a claim in the future, a previously signed arbitration agreement would not be enforceable as to sexual harassment or assault complaints or claims.
- An employee may still agree to arbitrate a dispute at the time the dispute arises, which may be worth exploring in some situations.
- The law does not have any impact on other discrimination claims or other employment disputes, so arbitration agreements may still be advisable for some companies.
Companies should review and revise any arbitration provisions in their employment-related agreements (non-disclosure, non-solicitation, non-competition, employment agreements, and any other agreements utilised by the company). If the arbitration clause attempts to mandate arbitration for sexual harassment claims, a court could invalidate the entire clause, an outcome that is uncertain at this point.
Perry MacLennanGGI member firm
Haynsworth Sinkler Boyd, P.A.
Advisory, Corporate Finance, Fiduciary & Estate Planning, Law Firm Services, Tax
Charleston (SC), Columbia (SC), Florence (SC), Greenville (SC), USA
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Haynsworth Sinkler Boyd, P.A. provides business, litigation and financial legal services to national and international clients. With a history dating back to 1887, it is one of the largest law firms in South Carolina, with more than 110 attorneys.
Perry MacLennan is a workforce and business lawyer with Haynsworth Sinkler Boyd. He advises clients daily on human resource concerns such as hiring, firing, leave, discrimination, safety and immigration. A skilled litigator when employment and business disputes arise, Perry has argued before the Supreme Court of South Carolina and routinely handles lawsuits in both state and federal court.
Published: Employment Law Newsletter, No.12, Summer 2022l Photo: f11photo - stock.adobe.com