Senator Kirsten Gillibrand (D-NY) likes to position herself as a champion of women. But her sponsorship of an anti-arbitration bill shows she is really a champion of trial lawyers.

Gillibrand’s bill to eliminate workplace arbitration agreements was passed out of the Senate Judiciary Committee earlier this week. Gillibrand claims that the “Ending Forced Arbitration of Sexual Assault & Sexual Harassment Act”, S. 2342, will exempt claims of sexual harrassment and assault from mandatory arbitration. But in an early Christmas gift to the plaintiffs’ bar, the bill will effectively end all workplace arbitration agreements.

As we have written elsewhere, arbitration agreements are an important vehicle for fairly resolving workplace disputes without expensive litigation. It provides for all of the same remedies that are available in civil court in a cheaper, faster, and more efficient setting. And employees win more often and collect more money in arbitration than they do in court. Of course, ensuring that employers compensate as many victims as possible as quickly as possible is not the goal of the plaintiffs’ bar. They’d rather see the majority of victims get nothing, so long as they can collect a sky-high windfall from a single runaway jury

In our view, arbitration can be particularly beneficial to employees who have been subjected to sexual misconduct, many of whom prefer the private, less intimidating setting of arbitration, which allows them to tell their stories in their own words, rather than face a public and formal interrogation in court.

Of course, reasonable minds may differ as to the best approach for resolving sexual misconduct claims. But, make no mistake: Gillibrand, who (like almost 50 percent of her colleagues in the Senate) is a lawyer, has drafted a bill that cleverly uses sexual misconduct allegations to blow up almost all employment arbitration agreements. 

As my colleague Inez Stepman has previously pointed out:

[Gillibrand’s] bill doesn’t limit itself to claims of actual sexual assault or harassment. Intentionally loose language bans arbitration enforcement even for claims having nothing to do with sexual misconduct, as long as there is at least one claim of that nature in the case, creating an incentive to add a perfunctory harassment claim to virtually every workplace dispute.

In other words, Gillibrand’s bill allows trial attorneys to drum up allegations of sexual misconduct in order to avoid arbitration requirements and shoehorn other workplace disputes into court.

By contrast, an alternative bill put forward by Senator Joni Ernst, herself a survivor of sexual assault, would exempt sexual misconduct claims from employment arbitration agreements without bulldozing employment arbitration generally. Ernst’s “Resolving Sexual Assault and Harassment Disputes Act of 2021”, S. 3143, limits the legislation to “claim[s] or dispute[s]” between employees and employers “arising out of allegations of conduct that constitutes sexual harassment” or “based on alleged conduct that meets the definition of a sexual assault,” while leaving current law in place for other claims. 

Unlike Gillibrand’s bill, Ernst’s legislation prioritizes compensating the victim, rather than her lawyer. Section 404 thus requires that the final determination of “any monetary relief to be paid to the plaintiff, and payment to the plaintiff” before payment of costs or attorneys’ fees. It requires that attorneys’ fees not exceed a “reasonable percentage” of a victim’s direct recovery, and prohibits lawyers from receiving more money than their clients.

Although we continue to believe that arbitration agreements should apply to all workplace claims, including those of workplace sexual misconduct, Sen. Ernst has offered a reasonable compromise that even supporters of workplace arbitration like the Chamber of Commerce can get behind.

Sen. Gillibrand’s bill hijacks the #MeToo movement to line the pockets of her friends in the bar.