WASHINGTON — The Senate passed legislation Thursday that would end forced arbitration for workers who are victims of sexual assault and harassment, one of the most significant changes to employment law in years.
The measure passed unanimously by a voice vote after garnering overwhelming bipartisan support in the House earlier this week. The bill now heads to President Joe Biden’s desk to be signed into law.
Under the legislation, employers would be prohibited from forcing workers to settle sexual misconduct claims in closed-door arbitration venues that often favor alleged perpetrators. Employees instead would be able to file suit in court with their own legal representation.
“This is among the largest workplace reforms, certainly in our lifetimes,” Sen. Kirsten Gillibrand, D-N.Y., who sponsored the legislation, said in a brief interview.
About 60 million workers in the U.S. are subject to forced arbitration, which is also used to resolve disputes involving claims of discrimination and pay disparity.
The legislation's ban on forced arbitration would kick in immediately, and apply retroactively to previous resolved claims unless a case is pending. It also applies to consumers who approve terms of agreement in exchange for using products, such as ride sharing services.
“From employment paperwork and lease agreements to the terms and conditions for apps and services, the majority of Americans have unknowingly signed their rights away,” Rep. Cheri Bustos, D-Ill., a co-sponsor of the House-passed bill, said in a statement. “Nullifying these ‘forced arbitration’ clauses for sexual assault and harassment claims will let survivors’ voices be heard.”
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In order to gain broad bipartisan support, the bill was limited to sexual assault and harassment, instead of including gender and other forms of discrimination.
The U.S. Chamber of Commerce, a traditionally Republican-leaning lobbying group, said it “strongly opposes” the legislation, calling arbitration “a fair, effective, and less expensive means of resolving disputes compared with going to court.”
Still, the bill received support from numerous congressional Republicans, including Sen. Lindsey Graham of South Carolina and Rep. Morgan Griffith of Virginia.
“I believe that this is a good bill, a righteous bill, a just bill,” Griffith said. “When you start talking about sexual assault and sexual harassment, nobody goes into a new employment thinking, ‘Well, I better double check all the fine print and make sure there’s nothing in there that would allow me to be sexually harassed or sexually abused.’”
A number of companies have already banned forced arbitration for sexual harassment in recent years, including Facebook, Lyft, Microsoft, Uber and Wells Fargo.
U.S. workers would still have the option of going the arbitration route after the bill is signed into law.
“You can still choose to go to arbitration. There, you will have survivors of sexual assault or sexual harassment who may not want to go to court,” Bustos said.
The issue gained increased attention with the efforts of former Fox News host Gretchen Carlson, who started an advocacy group pushing for corporate change and congressional action after she sued former Fox News CEO and Chairman Roger Ailes. Fox settled the sexual harassment case for $20 million.
Gretchen Carlson, awaiting a press conference to celebrate the Senate passage of the bill, weeped as the measure passed unanimously.
“This day is pretty surreal for me,” Carlson said after the House vote earlier in the week, adding that she hopes the legislation will change behavior in the workplace.