Adam Sencenbaugh in HR Magazine: ‘President Signs Bill Banning Mandatory Arbitration for Certain Claims’

Employers may want to review their arbitration agreements now that President Joe Biden has signed a bill into law banning enforcement of pre-dispute arbitration pacts for sexual-harassment and sexual-assault claims.

"There will be cases where victims want their claims resolved in private, but some survivors will want their day in court, and that should be their choice and nobody else's choice," Biden said at the signing on March 3. The law took effect immediately and applies retroactively.

"Employers should consider carving out sexual-harassment claims from their arbitration agreements, but the new law does not prohibit arbitration of these claims or an agreement to arbitrate them," noted Adam Sencenbaugh, an attorney with Haynes Boone in Austin, Texas. Under H.R. 4445, workers can still choose to arbitrate covered claims after the dispute arises. …

Current claims that are already pending when the bill is enacted are not covered, Sencenbaugh noted. Therefore, the pre-dispute agreement to arbitrate them remains enforceable.

To read the full HR Magazine article, click here.