Can You Be Forced Into Arbitration After Signing an Employment Agreement?

If you signed an arbitration agreement at work, you may assume you must resolve disputes outside of court. That is no longer always the case.

Under the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (EFAA), employees can choose to pursue qualifying claims in court, even where they previously agreed to arbitrate.

Whether arbitration still applies depends on (i) the nature of the claim, (ii) how it is pleaded, and (iii) when the conduct occurred.

What does the EFAA do?

The EFAA makes pre-dispute arbitration agreements unenforceable, at the employee's election, in cases involving sexual harassment or sexual assault brought under federal, state, or tribal law.

Crucially, courts interpret the statute by reference to the “case” as a whole, rather than isolating individual claims.

When does the EFAA apply, and when does it not?

The EFAA does not apply simply because harassment is mentioned. Courts generally look for a properly supported sexual harassment claim.

Courts have rejected attempts to rely on the statute where allegations were vague or unsupported, including in Johnson v. Everyrealm, Inc. and Bruce v. Adams & Reese, LLP.

Practical point: a claim must be supported by specific factual allegations. Bare assertions will not prevent arbitration.

What happens to related claims?

Where a valid harassment claim is established, courts have held that the entire case may fall outside arbitration.

This can include related claims such as retaliation or discrimination where they arise from the same underlying facts, for example, retaliation following complaints of harassment.

Practical point: the closer the factual link to the harassment allegations, the more likely all claims will proceed in court.

Does timing matter?

Yes. The EFAA applies only to claims that arose or accrued on or after March 3, 2022.

Courts focus on when the claim accrued, not when the arbitration agreement was signed.

For ongoing conduct (such as hostile work environment claims), courts may treat the claim as continuing. The Second Circuit confirmed in Olivieri v. Stifel, Nicolaus & Co. that later conduct can bring earlier events within scope.

Practical point: where conduct spans the March 2022 cut-off, later events may determine whether the EFAA applies.

Are there limits to the EFAA?

Yes. The Act does not apply where all relevant conduct predates March 3, 2022.

For example, in O'Sullivan v. Jacaranda Club, LLC, arbitration was enforced because the conduct arose entirely before the statute took effect.

Practical point: older claims may still be subject to arbitration, even if brought alongside newer allegations.

What is the key takeaway?

An arbitration agreement is no longer determinative.

Where a complaint includes a properly supported sexual harassment claim, particularly one factually linked to other claims, employees may still be able to proceed in court even if they agreed to arbitrate.

Need advice?

If you are dealing with an arbitration issue of this type, early legal advice can be important.

You can contact our firm here.

Legal Disclaimer: This post is provided for general informational purposes only and does not constitute legal advice. It should not be relied upon as a substitute for advice from a qualified lawyer regarding your specific circumstances. Reading this post or contacting the firm through this website does not create an attorney-client relationship.