No Mandatory Arbitration Under the NYS Anti-Sexual Harassment Law

Will the Provision Hold Up Under Higher Court Scrutiny? New York’s new anti-sexual harassment law states that New York employers may no longer include mandatory arbitration clauses for sexual harassment claims. Furthermore, settlements regarding sexual harassment claims may not include non-disclosure provisions. The exception would be when the complainant prefers to include such a provision. Reasons the Arbitration Provision May Not Stand In a recent case, Mahmoud Latif v. Morgan Stanley & Company, the company moved to compel arbitration of Latif’s claims based on their arbitration agreement. The arbitration agreement stated that covered claims would include statutory discrimination, harassment and retaliation claims. Latif alleged that he was sexually assaulted by a female supervisor, was subjected to inappropriate comments regarding his sexual orientation, inappropriate touching, sexual advances and offensive comments about his religion. He reported the incidents to the company’s Human Resources department. The only disputed aspect between the parties is whether the complaint is subject to the arbitration agreement based on the recently enacted New York anti-sexual harassment law. Ruling in the Case The judge granted Morgan Stanley’s motion to compel arbitration of the Latif claim. The reason given was that “the Federal Arbitration Act requires courts to enforce covered arbitration agreements according to their terms.” The judge stated that “the Supreme Court has instructed that the FAA reflects ‘both a liberal federal policy favoring arbitration and the fundamental principle that arbitration is a matter of contract.'” Basically, the federal law takes precedence over state law. State law is subject to preemption, which means that a higher court or authority displaces a lower court or authority regarding matters that...

Details of the NY Anti-Sexual Harassment Law for 2019

The New NY Anti-Sexual Harassment Law: What Employers Should Know Additional New York State anti-sexual harassment law protections came into existence in August 2019. Under the new law, sexual harassment only has to rise above the level of “petty slights or trivial inconveniences,” which is a much lesser burden of proof. This change will make it much easier for victims to come forward and file a lawsuit against employers. By comparison, under the previous law, the plaintiff would have to prove that sexual harassment was “severe or pervasive.” When Does the New Law Go into Effect? The law will roll out in three stages during the next 60 days. Who Does the New Law Affect and How? The new law amends existing Human Rights Law and includes all public and private employers in New York. Also, the law increases the statute of limitations (time limit to file a lawsuit) from one year to three years. How Do the Changes Affect Employment Agreements? Employment agreements can no longer prohibit employees from filing a complaint with a state or local agency, nor can it prevent them from testifying in government investigations. In addition, the law prohibits employers from requiring mandatory arbitration in settlement agreements. Arguments against the law and that are in favor of employers are that this is unfair because it weakens employers’ affirmative defense. They would incur significant liability for behavior that occurs outside of work hours that they have no way of knowing about. How Are All Individuals in the Workplace Protected? The new law extends protection beyond private company or government employees and offers protection to the...