Arbitration and Sexual Harassment: What are Your Rights?

Sexual HarassmentThe sexual harassment lawsuit by former Fox News host Gretchen Carlson against her former boss, Roger Ailes, has already led several other women to come forward to complain about similar harassment.

Carlson was a host of Fox's morning news show from 2006 to 2016. Later, she was moved to an afternoon show, which she saw as a demotion.

When her show's ratings failed to capture a key 25- to 54-year-old demographic, she was informed that her contract wouldn't be renewed.

As reported by the New York Times, Carlson alleged that Ailes made sexual advances toward her and then fired her because she complained about sexual harassment at Fox.

According to the court papers, Ailes labeled Carlson a "man hater" and said that they "should have had a sexual relationship a long time ago."

The suit led to Ailes' resignation. He reportedly left with the $40 million due for the balance of his contract term, which ran through 2018.

The Lawsuit

Carlson filed her suit in a New Jersey Superior Court. Lawyers for Ailes sought to have the case moved to federal court, and to have the dispute resolved via arbitration.

According to Ailes' petition, Carlson's employment contract included the following clause:

Any controversy, claim or dispute arising out of or relating to this Agreement or [Carlson's] employment shall be brought before a mutually selected three-member arbitration panel and held in New York City...

Forcing Arbitration

Under the Federal Arbitration Act, when a contract has an arbitration clause, one of the parties to the contract can petition a federal district court for an order for arbitration to proceed.

Ailes' lawyer said that the federal court should ignore Carlson's "transparent tactical strategy" of "trying to evade" the arbitration agreement by suing only Ailes, and not Fox. (Fox, not Ailes, signed the contract.)

Ailes' lawyer cited several cases in which courts allowed agents of corporations who had not themselves signed agreements to enforce the arbitration clauses in such agreements.

"I Didn't Agree to Arbitrate That!"

Employees may not realize that when they sign employment agreements including arbitration clauses, those clauses may also apply to claims of sexual harassment, discrimination, and even assault. An article in the Cardozo Journal of Conflict Resolution noted that

Despite the use of broad and seemingly all-encompassing language in broad mandatory arbitration clauses, some employees’ claims can escape their reach and proceed to court.

For example, in one case the plaintiff was working as a clerical assistant for Halliburton in Baghdad. She alleged that she was housed in a predominantly male barracks where she was sexually harassed and, despite asking to be moved to a safer location, eventually gang-raped.

The court found that the employee's claims did not "relate to" her employment and thus were not covered by the arbitration clause in her employment agreement.

Takeaway

If you've been the victim of workplace sexual harassment — or even sexual assault — you might be able to avoid arbitration of your claim, even though your employment contract has an arbitration clause. Whether Carlson will be required to submit her harassment claim to arbitration is a question that the courts will likely resolve in the coming months.

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