Facebook to abandon forced arbitration in cases of harassment

SAN FRANCISCO – Facebook announced on Friday that it will no longer force employees to resolve requests for sexual harassment in private arbitrations, thus making the latest technology company do away with a practice that critics claim has stacked the deck against the victims of harassment.

Facebook acted a day after Google announced similar plans. Last week, 20,000 Google employees organized a move away from corporate offices around the world to demand that they change the way they handled sexual harassment episodes. Microsoft changed its arbitration policy about a year ago, just as the Uber company salutes six months ago.

The technology industry, known for its revolutionary products and its trendy office culture, has made great strides in recent years to keep disputes at work outside the judicial system. Forcing employee complaints into arbitrations has become commonplace as free lunches and shuttle buses to the office.

In the arbitration, experts say in the field of employment, the playing field moves towards the companies. Cases are decided by the referees instead of the judges, and the more cases the companies take for arbitration, the better they are doing, according to a 2011 analysis by Alexander JS Colvin, a professor at Cornell University School of Industrial and Labor Relations.

"This is a crucial moment for our industry and for corporate America in general," a vice president of Facebook said in a statement by Lori Goler. "We think this is the right thing to do and hope that other companies will do it too".

The use of the arbitration clauses, incorporated in the fine print of contracts, has soared in the last decade, as companies try to keep the disputes away from public scrutiny.

Chris Baker, lawyer for employment and partner of law firm Baker Curtis & Schwartz, said arbitration cases were often heard by a retired judge who may not be as empathetic as a jury against a victim of harassment. They are often wrapped up in confidentiality and arbitrations tend to be lower than those in a jury trial.

Mr. Baker said that moves by technology companies could remedy arbitration in all kinds of employee disputes because it would be difficult for companies to trace the line of sexual harassment.

"I think it's the pebble that starts the avalanche," he said. "This is very significant."

The technology industry is reacting, at least in part, to the anger among employees that harassment has often remained unpunished, particularly when powerful leaders are involved. The ejection of Google has been requested by a The New York Times article last month revealed that the company had paid millions of executive outlet packages even after discovering that they had been credibly charged with sexual harassment.

Because statements are often kept secret in confidential arbitration hearings, critics argue that harassers often move easily to other jobs without warning to future victims.

It has become a significant problem in Silicon Valley, where gender imbalance is strong and stories of sexual harassment are rampant. Critics of arbitration requirements have pushed companies to suppress arbitration and confidentiality clauses that often help companies keep the public and their employees obscure about misconduct.

The Commission for Equal Employment Opportunities noted that forced arbitration "can prevent employees from learning similar concerns shared by others at their workplace".

Facebook said it would now make arbitration an option, but not a requirement, for employees who reported a request for sexual harassment. Facebook said it planned to make changes to its arbitrage policy for "a little bit" but did not specify a period of time. There is no indication that the company is facing specific pressure to change its policies.

In May, Uber announced that it was eliminating the practice for employees, drivers and drivers who make such claims against the company. Uber took the step after 14 women who accused Uber drivers of sexually rape them he wrote a letter to the company's board of directors, urging them to waive the requirement and allow them to proceed with a lawsuit in open court.

Lyft, Uber's main competitor, made a similar policy change in the same period.

In December, while Microsoft was faced with a proposal for collective action by female technical staff claiming discrimination, it promised to end the arbitration requirement for harassment requests. Women have lost the case and are tempting.

Microsoft's policy change was largely symbolic because the company rarely used arbitration clauses in its labor agreements. However, Microsoft also claimed that it would support federal legislation by making the arbitration requirement in cases of harassment inapplicable.

Apple has never arbitrated a request for harassment or discrimination, said Kristin Huguet, a spokesperson for the company. He had a forced arbitration obligation for new employees until the start of this year, but he made the optional arbitration and then eliminated the clause from the labor contracts altogether. She did not specify when. Ms. Huguet said that even Apple employees who had accepted such an agreement were no longer bound by it.

Companies large and small have figured out how to use arbitration to prevent employees from bringing court disputes and preventing others, including customers, from coming together in a class action. Some state judges have called the ban on collective actions – one of the few ways in which ordinary citizens can fight companies in their pockets because of commercial and unfair practices – a "get out of prison" card for employers.

In recent years, it has become difficult to request a credit card, obtain cable services, rent a car or shop online without agreeing to resolve any arbitration disputes. The same is true for getting a job.

The use of arbitration clauses can be traced back to a coalition of credit card companies and retailers who have come up with a plan to protect themselves from costly legal action. Since 1999, the group's legal teams have begun to discuss how to use the fine print of contracts to stop class actions. The Bank of America, Chase, Citigroup, Discover, Sears, Toyota and General Electric all participated.

Arbitration clauses that do not allow classic suits are used by a wide variety of companies, including Macy & # 39; s and Kmart. In 2016, when Gretchen Carlson sued Roger E. Ailes, her former head of Fox News, on charges of sexual harassment, her attorneys pushed the case for arbitration.

Google Walkout for Real Change, the group behind last week's employee protest, responded to Facebook's decision on Twitter: "When we said that this is a global movement, we did not mean only in Google: it is stimulating to see the effects of #GoogleWalkout spreading in our company".

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