New York employers:
Another federal judge in New York has held that a pre-dispute arbitration agreement is not enforceable as to THE ENTIRE dispute, where even PART of the dispute involves allegations of sexual harassment (which cannot be compelled to arbitration).
As a reminder, under the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (“EFAA”), employees asserting sexual harassment claims who entered into pre-dispute arbitration agreements have the option to reject those agreements and instead bring those claims in court.
In this most recent case, a former employee who had signed such an arbitration agreement brought claims against his former employer for both wage violations and sexual harassment. The magistrate judge held that since the wage claims were wholly unrelated to the sexual harassment claims, the wage claims were subject to arbitration and that only the sexual harassment claim could proceed in court pursuant to the EFAA. On appeal, however, the district court analyzed the statutory language of the EFAA and concluded that the entire dispute (the wage claims and the sexual harassment claim) must proceed in court.
The decision is available here: MeraSAHospitality111725.pdf
Stay tuned.