November 16, 2018

Google and Facebook’s recent pledges to stop making workers arbitrate sexual misconduct claims underscore a surge in public skepticism toward mandating arbitration of workplace disputes, a trend that experts say may lead to more businesses taking a second look at their policies.

This swing toward arbitration carveouts for sexual harassment claims is liable to influence businesses besides Facebook Inc. and Google LLC, but it’s too early to gauge its impact on other workplace disputes — like wage-related claims these tech titans still send to arbitration — or public policy. However, there's no doubt that a lot of people see forcing workers to arbitrate claims, rather than hash them out in court, is unjust.

“There is ... a great recognition for large swaths of the public that such mandatory arbitration provisions are really unfair and not the best way to resolve disputes,” said Christine Webber, an attorney with Cohen Milstein Sellers & Toll PLLC who represents workers in bias suits. “It’s just a question of under what circumstances do you end up with enough leverage to discourage an employer from going down that road.”

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These businesses have two things in common that likely drove them to take this step, Webber observed: As consumer-focused companies, they have to cater to public opinion, and their workforce is highly skilled, giving their employees outsize power to demand concessions. Employers outside Silicon Valley that share these traits may follow suit in the coming months, and those with unionized workforces may as well, Webber said.

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Webber, the worker’s attorney, said women who are harassed in the workplace often face other forms of discrimination too. For example, a company that tolerates harassment toward women may also make it harder for women to advance, she said. Whether these carveouts will give workers a backdoor to bringing other claims in court, or force businesses and workers to litigate on two fronts, is unclear.

“That’s uncharted territory right now,” Webber said. “While [employers] can certainly draw up an arbitration agreement that purports to maintain a line, I think in practice it will be very difficult to implement.”

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