Since the passage of the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (EFAA), federal courts have struggled to determine what types of gender-based allegations can still be compelled to arbitration and which must be litigated in court.
A recent SDNY decision provides another data point, ruling in favor of upholding the arbitration agreement signed by the employee.
In Waiguchu v. Morgan Stanley, the court ruled that Ms. Waiguchu’s claims must be resolved through arbitration, as required by the arbitration agreement she signed at hire, because her allegations of differential treatment and microaggressions based on gender and race did not meet the legal definition of “sexual harassment” under the EFAA.
Specifically, plaintiff alleges that she was subjected to gender-based discrimination, including being assigned less complex work compared to male colleagues, being spoken to in a condescending and hostile manner by her male supervisor, and being denied equal opportunities by her female supervisor, who also subjected her to microaggressions.
Since her claims did not fall under the EFAA’s protections, they were not exempt from arbitration. The court also clarified that arbitration would not limit the scope of her claims, which would still be fully heard by the arbitrator.
This decision highlights a potentially growing split in interpretation of the EFAA’s scope. Stay tuned.