Microsoft Won't Make Women Settle Sexual Harassment Cases Privately Anymore. Here's Why That Matters

Microsoft announced on Tuesday morning that it will no longer require women to resolve cases of sexual harassment in private, becoming one of the first major companies to eliminate so-called forced arbitration clauses.

The technology giant also supported federal legislation introduced by a group of bipartisan lawmakers, including Democratic Senator Kirsten Gillibrand and Republican Senator Lindsey Graham, to prevent companies from using forced arbitration for sexual harassment.

Forced arbitrage prevents employees from taking their claims to court, instead of requiring them to settle disputes in a private process conducted by a third party. The process is cheaper and faster for employers than a court case, but advocates of sexual harassment like Gretchen Carlson have pointed out that women are less likely to win cases in arbitration and receive smaller settlements than in trials. Advocates have also argued that arbitration allows companies to hide systemic problems from public view.

"Forcing the arbitration of sexual harassment claims is a tool to keep the company looking impeccable and out of the news," said employment attorney Maya Risman.

In a blog post, Microsoft's chief legal officer and president, Brad Smith, said that most of the company's employees no longer had clauses of forced arbitration for sexual harassment. But an internal review found that such clauses applied to a "small segment of our employee population." The company has now vacated those clauses, which means that all employees have the option of filing lawsuits for sexual harassment in court.

The company also used arbitration to resolve other types of disputes and did not say whether it would continue.

"We came to the conclusion that if we advocated legislation that would end arbitration requirements for sexual harassment, we should not have a contractual requirement for our own employees that would compel them to arbitrate sexual harassment claims," ​​Smith wrote. "And we must act immediately and not wait for a new law to be approved."

Microsoft's decision comes a week after Bloomberg reported that a former intern of a company alleged in February 2014 that another intern had sexually assaulted her outside of work. The woman said Microsoft made the two work together while investigating her claims.

The company told Bloomberg that it encouraged the woman to go to the police and offered to connect her with the victims' advocacy groups. (I was not working at Microsoft under a forced arbitration clause). "We work hard to create a safe work environment for each employee," the company said in a statement at the time.

Some advocates say that while Microsoft's announcement of arbitration clauses is largely symbolic, it remains significant.

"By doing this, Microsoft says it will take concrete steps to make its culture in the workplace more conducive to tackling and preventing harassment," said Emily Martin, the general counsel and vice president of labor justice at the National Law Center of the woman. "That message is important beyond the impact on people whose contracts are about to change."

The legislation of Gillibrand and Graham estimates that 60 million Americans have forced arbitration clauses in their contracts, while a September study by the Institute for the Defense of Labor Rights of Law and Policy found that 80% of the 100 largest companies of the country they use.

"While Microsoft apparently did not use these provisions in its entire workforce, some companies use them more indiscriminately in their workforce to force lower-paid workers, as well as workers with higher wages," he said. Martin. "By standing up and saying that you believe these provisions are not fair to employees, Microsoft helps to change the conversation in a way that has the potential to help many people by increasing pressure on businesses to do the same." .

But Myriam Gilles, vice-dean and professor at the Benjamin Cardozo Law School, is not so sure that Microsoft's announcement will influence smaller companies. "Small businesses may feel that these clauses protect their results," Gilles said. "They may feel more concerned with their final results than with the optics, considering that they do not really have to worry about optics."

In the midst of the #MeToo movement, many have called for the end of forced arbitration. Carlson has become a prominent voice on the issue after navigating around the arbitration clause in his contract to sue Roger Ailes for sexual harassment last year. (Ailes, who died earlier this year, had denied the allegations). In August, the attorneys of Uber whistleblower Susan Fowler filed an amicus curiae with the Supreme Court arguing that technology companies should eliminate these clauses, as the court considers whether employers can ban collective lawsuits and force employees to arbitrate.

"I understand that this is a great thing that Microsoft is making progress on this issue that is in the news at the moment," Gilles said. "But it would challenge Microsoft and all other companies to get rid of forced arbitrage in all areas."