The Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act is Bearing Fruit for Victims of Workplace Sexual Harassment in New York

Sexual harassment has been a violation of New York City, New York State, and federal law for many years. However, recent developments in the law have given victims of sexual harassment more power than ever before. Many workers, whose cases in the past would have been forced into arbitration by their employers, can now successfully defeat that effort and continue to pursue relief in civil court. Whether you’re initially bringing a sexual harassment case, overcoming a mandatory arbitration agreement, or successfully securing compensation, representation from a skilled New York City sexual harassment lawyer can be essential to your success at each step along the path.

One of the most important new developments is the enactment of the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (EFAA), which President Biden signed into law in early March 2022. That new law has already helped multiple New York workers avoid the mandates of onerous arbitration agreements.

A very recent example comes to us from a sexual harassment case in the federal Southern District of New York court.

The worker, D.M., worked as a busser at an Italian restaurant in Manhattan’s Upper East Side. When he started his job in late May 2022, he signed an arbitration agreement that said, in its very first sentence, that the busser agreed to resolve “any disputes arising out of or in any way relating to Employee’s employment or termination from employment with [the restaurant] … exclusively by final and binding arbitration on an individual basis before one neutral arbitrator.”

Homophobic Slurs and Unwanted Touching

Not long after the busser, who was gay, started working at the restaurant, coworkers allegedly began sexually harassing him, calling him various Spanish-language homophobic slurs, quizzing him about his sex life, and grabbing his body without consent.

The employer also allegedly illegally underpaid the busser. When the busser sued in early 2023, he alleged claims for sexual harassment and sexual orientation discrimination in violation of the New York City Human Rights Law and New York State Human Rights Law, along with claims for unpaid wages.

The employer asked the court to order the two sides to resolve the dispute through binding arbitration. The arbitration agreement the busser and the employer had signed was — as is typical of a lot of arbitration agreements that many workers must sign when they start a new job — exceedingly broad, covering “any” dispute that was “in any way” related to the busser’s employment at the restaurant.

A few years ago, this kind of broad agreement (and the employee’s signing such a document) would have successfully forced the case from federal court and into an arbitration setting.

EFAA Applies Whenever the Conduct ‘Constitutes Sexual Harassment’

Now that the EFAA has amended the Federal Arbitration Act, that’s not true anymore. Today, a worker can still avoid arbitration, even if he signed an arbitration agreement, if his case alleges “conduct that is alleged to constitute sexual harassment under applicable” state or federal law.

In the busser’s case, the judge determined that his allegations clearly laid out “a dispute relating to conduct that is alleged to constitute sexual harassment under” state law; namely, the NYSHRL. As a result, the EFAA applied and the busser could not be forced to arbitrate his sexual harassment/sexual orientation discrimination claims.

An ‘Unrelenting’ Barrage of Sexual Questions and Comments

Earlier this year, a former employee at a New York City “metaverse-focused innovation firm and investment platform” achieved similar success. The employee, T.J., was the Head of Strategic Relationships for the employer. According to his sexual harassment lawsuit, he endured an endless torrent of sexual harassment.

A few weeks after he started, the employee attended a conference in Texas where the employer’s CEO allegedly told him that she encouraged employees to have sex with coworkers and business partners/clients while on business trips, and quizzed the employee about whether he would be engaging in any such activities while on the Texas trip.

The CEO also allegedly badgered T.J. about his sex life with his then-girlfriend. Additionally, the CEO and another company head allegedly “loudly speculated” about which employees were having sex with one another, making T.J. feel he “could not escape the sexual harassment-filled toxic work environment.”

Eventually, after the employer fired T.J., he sued, asserting claims of sexual harassment, gender discrimination, race discrimination, and hostile work environment in violation of the NYSHRL and the NYCHRL, and pay discrimination in violation of the New York Labor Law.

Just as in the busser’s case, the employer in T.J.’s case asked the court to order the two sides to resolve the dispute through binding arbitration. In support of that motion, the employer pointed to the arbitration agreement T.J. signed when he started with the company in 2022. Much like the agreement the busser executed, the document T.J. signed had a mutual agreement to arbitrate.

The Southern District court concluded that the arbitration agreement applied to all of T.J.’s causes of action and, if not for the EFAA, all of his claims “would be required to be resolved in arbitration.” Much like the busser’s arbitration agreement, T.J.’s was extremely broad, covering “any dispute or controversy arising out of or relating to any interpretation, construction, performance, or breach of this” employment agreement.

As a result, without the EFAA, T.J.’s case would have gone to arbitration. It did not, however, thanks to the EFAA’s changes in the law. As noted above, the EFAA is implicated whenever a worker alleges conduct that would qualify as “sexual harassment under applicable” state or federal law.

This worker’s complaint did that. Contrary to the employer’s arguments, what T.J. endured was more than just “petty slights or trivial inconveniences.” The lawsuit alleged that the CEO repeatedly pressured T.J. to have sex with her, with other coworkers, or with clients, continuing the sex-focused harangue even after T.J. explicitly asked her to stop multiple times. Previous cases have repeatedly held that allegations of “sexually-charged conduct” (similar to what T.J. endured) are sufficient to establish a violation of the NYCHRL’s prohibition against sexual harassment.

Avoiding Arbitration of All Claims

The court in T.J.’s case provided him with an even more resounding victory than what the busser received. The judge, in denying the employer’s motion to compel arbitration, ruled that T.J. could proceed in court on all of his claims — both the sexual harassment-related ones and ones unconnected to sexual harassment (like pay discrimination.)

By contrast, the judge in the busser’s case concluded that the EFAA Blocked forced arbitration of his sexual harassment and sexual orientation discrimination claims, but that the law did nothing to nullify the arbitration agreement’s control over the busser’s claims that were unconnected to sexual harassment and sexual orientation discrimination; namely, illegal pay practices in violation of the New York Labor Law and the federal Fair Labor Standards Act. Part of the basis for this outcome was the busser’s allegation that the employer engaged in illegal pay practices affecting both employees who were victims of sexual harassment and/or sexual orientation discrimination as well as those who were not.

The experienced New York sexual harassment attorneys at Phillips & Associates understand that pursuing justice for sexual harassment can seem daunting, and we’re here to help empower you and level the playing field. To put a knowledgeable advocate who has spent years fighting for workers victimized by workplace sexual harassment on your side, contact us online or at (866) 229-9441 to set up a free and confidential consultation today.

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