Bill to ban arbitration of sexual harassment claims clears House

2 minute read

The U.S. Capitol building is pictured in Washington, January 26, 2022. REUTERS/Joshua Roberts

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  • Bipartisan bill would void agreements to keep harassment claims out of court
  • Bill was spurred by the #MeToo movement
  • Senate could vote on the proposal as early as this week

(Reuters) - The U.S. House of Representatives on Monday overwhelmingly approved a bill to prohibit businesses from requiring workers and consumers to agree to bring sexual harassment claims in confidential arbitration rather than in court, teeing up a Senate vote as soon as this week.

The Democrat-led House voted 335-97 to pass the bill, which has broad bipartisan support though some Republicans on Monday expressed concerns that it would limit legal options for victims of sexual harassment and assault.

The White House last week said President Joe Biden, a Democrat, supports the proposal.

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If it becomes law, the bill would release tens of millions of workers and consumers from arbitration agreements in cases involving sexual harassment and assault, making it one of the most impactful policy changes to come out of the #MeToo movement.

Several states including New York and California have already banned mandatory arbitration of harassment claims by workers, and companies including Alphabet Inc's Google, Facebook, eBay and Wells Fargo have stopped enforcing arbitration agreements in harassment cases.

Rep. Cheri Bustos, a Democrat from Illinois who sponsored the bill, said allowing victims of harassment and assault to sue in court would make it more difficult for perpetrators to cover up their conduct.

"My hope is that what we learn from this is no one should be forced into a secret third-party negotiation that allows bad behavior to continue," Bustos said in an interview before Monday's vote.

The Federal Arbitration Act requires that otherwise valid agreements to take legal disputes to arbitration be enforced according to their terms. Monday's bill would amend the FAA to carve out an exception for cases involving sexual harassment and assault.

The bill applies to employment agreements and consumer contracts, such as those maintained by nursing homes, landlords, ride-sharing companies and home repair services. An estimated 60 million U.S. workers are subject to mandatory arbitration agreements.

Senate Majority Leader Chuck Schumer, a Democrat from New York, said on Monday that the bill could come up for a vote as soon as this week in the Senate, where it has the support of several high-ranking Republicans and is widely expected to pass.

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Dan Wiessner (@danwiessner) reports on labor and employment and immigration law, including litigation and policy making. He can be reached at daniel.wiessner@thomsonreuters.com.