Should Rape Be Arbitrated?

Crossposted from ContractsProfBlog.

Must a rape be arbitrated if an employment contract calls for “any and all disputes” to be resolved by arbitration?

Thankfully not, according to an Ohio Court of Appeals (Arnold v. Burger King, No. 101465, 2015 WL 6549138). 

When Ms. Arnold obtained employment with a Burger King franchisee, she signed a contract that, among other things, provided as follows:

Under this arbitration program, which is mandatory, Carrols [the franchisee] and you agree that any and all disputes, claims or controversies for monetary or equitable relief arising out of or relating to your employment, even disputes, claims, or controversies relating to events occurring outside the scope of your employment (“Claims”), shall be arbitrated before JAMS, a nation arbitration association.

Ms. Arnold alleged that she was harassed and sexually abused over an extended period of time by her supervisor who, among other things, forced Ms. Arnold to perform oral sex on him in the men’s restroom at the restaurant during working hours. Ms. Arnold brought suit, claiming sexual harassment; respondeat superior/negligent retention; emotional distress; assault; intentional tort, and employment discrimination. The franchisee sought to compel arbitration, arguing that Arnold’s claims were subject to arbitration under the mandatory arbitration agreement because they “arose out of Arnold’s employment.”  (That’s right: the company wanted JAMS to resolve a serious rape case…) Ms. Arnold answered that her claims fell outside the scope of the arbitration agreement and that the agreement was, furthermore, unenforceable because it was unconscionable.

The court agreed with Ms. Arnold.  “When claims may be independently maintained without reference to the contract or relationship at issue,” they do not have to be arbitrated.  Clearly, a civil complaint can be brought for sexual assaults and harassment even without the existence of a contract.  “Arnold’s claims relating to and arising from the sexual assault exist independent of the employment relationship as they may be maintained without reference to the contract or relationship at issue.” Ms. Arnold thus did not have to arbitrate the claims for that reason alone.

As for unconscionability, the court found the agreement to be procedurally unconscionable because Arnold, a previously unemployed entry-level employee, signed the agreement, drafted by the employer, when it was presented to her as a condition for hiring her.  “As for Arnold’s bargaining power, the choice was either sign it or remain unemployed. There is no evidence that Arnold could alter any of its terms.”  The court found the agreement substantively unconscionable as it sought to include “every possible situation that might arise in an employee’s life” and because it failed to set forth the potentially high costs of arbitration.

What makes this case even more stunning is the fact that the franchisee was aware of the very troubled employment environment at its restaurants. This led to several other sexual harassment charges, including sexual assault allegations, filed by the EEOC and which were ongoing for more than a decade.  One might have hoped that an employer such as this would want stricter measures, and not arguably more lenient ones, against those of its employees that have violated norms and rules of appropriate workplace behavior to signal that such behavior is unacceptable in 2015.  Apparently, in at least some geographical and socio-economic locations, that is too much to hope for.

Featured image courtesy of Pixabay.