With Recent Federal Court Decision, Can NYS Still Prohibit Mandatory Arbitration for Sexual Harassment Allegations?

When Governor Cuomo signed the 2018 Budget Bill, one of the provisions was a prohibition against employers including any written clause in employee’s contracts or company policy requiring sexual harassment allegations to go through mandatory arbitration prior to outside courts. The only exception would be where this provision was inconsistent with federal law.

Turns out, it’s inconsistent with the Federal Arbitration Act (FAA), and therefore invalid.

In short, this means that NYS employers may enter into mandatory arbitration agreements so they can seek resolution to sexual harassment disputes prior to a case ending up in the courts.

To read more on the case and the details surrounding, see the legal commentary by Bond, Schoeneck and King Attorney’s.