In this blog post, Prakhil Mishra, a student of Institute of Law, Nirma University, Ahmedabad, who is currently pursuing a Diploma in Entrepreneurship Administration and Business Laws from NUJS, Kolkata, describes the process of arbitration in the case of sexual harassment.
Sexual harassment claims are the most cursed upbringing of the modern era. There are several cases all around the world reflecting the plight of female employees working in unhealthy circumstances and who are prone to such harassment. It has been incumbent for the lawmakers to consider this issue with utmost seriousness. The USA is one of those countries where cases of sexual harassment are increasing exponentially with the increase in industrialization. Hence, the present article is focusing upon the discussion going around the world right now about dealing with such issues in arbitral forums. Pursuant to same, I would like to draw an inference of such model evolving in the USA.
The US Supreme Court and the Federal Courts have reached to diversified outcomes while ascertaining the question whether sexual assault and harassment cases shall be dealt within the broad scope of arbitration clauses. There are different views of the court regarding this:
- The claims of sexual assault and harassment are arbitrable;
- The claims of sexual harassment is arbitrable but sexual assault is not;
- Neither of them is arbitrable.
Here the major controversy is related to lack of uniformity between cases as each of them ensues different factual circumstances and it is difficult to construe them in single opinion whether the cases of such heinous nature should be subject to arbitration or not.
The present article would give effect to a debate about making such acts arbitrable or not. In the USA, the increased prevalence of mandatory arbitration in employment contracts is a comparatively new drift that has resulted from the Supreme Court’s sustain of arbitration as a proper method of resolving disputes post Gardner-Denver case. Also, in this case, Supreme Court has supported the view that under employee’s contract, employers should not bind employees for a mandatory arbitration clause and waiving off his right to bring a claim under statutory machinery.
Mandatory Arbitration Shall not be a Part of Contractual Agreements
President Obama signed the Franken Amendment to the 2010 Defense Appropriations bill into law. The Franken Amendment to the bill prohibits the use of any funds made accessible by the Act if a contractor or subcontractor providing services or equipment under the Act requires its employees to arbitrate certain claims. It was the first law which has prohibited employers from binding employees’ in mandatory arbitration for the sexual harassment cases.
Arbitration in sexual harassment cases in the US
If I interpret what has been said in one of the three landmark cases in the Steelworkers Trilogy that in several cases or grievances of workers inclusive of Title VII grievances which may also relate to sexual harassment cases, the national labor policy favors the mode of arbitration because an arbitrator would know the background of the workplace and conditions prevailing in a much better way. It is also commonly known as ‘common law of the shop’. With the growing body of reported arbitration cases of the sexual harassment, various important and essential evidences have become apparent.
Some years ago, the National Academy of Arbitrators went into an extended, sometimes heated, discussion on this issue. For large number National Academy of arbitrators, and perhaps other arbitrators, that debate may now be moot. The interpretation of the texts of arbitral decisions clearly reflects arbitrator recognition that external law and the content of collective bargaining agreements are parallel paths for resolution of workplace disputes and it has taken an important position in the modern legal world. No workplace issue shows the influence of external law on arbitral decision-making as clearly as sexual harassment. Study of arbitral sexual harassment cases in print in the last five years in Labor Arbitration Reports and in Labor Arbitration Awards reflected that the preponderance of such cases involved, as in court cases, an allegation of hostile work environment. The published awards show some interesting dichotomies in how arbitrators view the relationship between conduct and the appropriate penalty.
It can be argued that these arbitral dichotomies are steady with the way Federal courts characterize what constitutes severe or pervasive conduct that alters the terms and conditions of another person’s employment. Here when it is found put that the case which has happened is very serious and grave then the punishment which is given is also serious and grave, which may in include the termination of the employer from the services. Additionally, if the cases are not severe then the arbitrators for the just and legal procedures go for different analysis of the cases which include procedural and substantive dynamics.
Arbitration and Sexual Harassment: Position in India
Contrary to the established practices in America, where the contractual agreements contain the Arbitration clause which is often resorted to by the parties in such matters, Indian laws do not provide for arbitration mechanisms. The laws governing the sexual harassment of women are Indian Penal Code, 1860, Indecent Representation of Women’s Act 1986, and Sexual Harassment of Women at Workplace (Prevention, Prohibition, and Redressal) Act, 2013.
The instances of sexual harassment are dealt with utmost severity as IPC provides for 1-3 years of imprisonment or fine or with both. The Sexual Harassment of Women at Workplace Act, 2013 is another instrument which covers women not only from organized sector but also from unorganized sector. As far as the ‘arbitration’ in harassment cases is concerned, none of the provisions exist in India. But, Sec. 10 and Sec. 11 of the Sexual Harassment of Women at Workplace Act, 2013 provides for ‘conciliation’ in such matters. You can learn more about sexual harassment and laws governing them by taking up this course. You can also learn about sexual harassment at workplace by taking up this course by National University of Juridical Sciences.
The process is given in Sec. 11 where a written complaint has to be filed by the victim within 3 months from the date of the incident and the inquiry has to be completed within 90 days by the Internal Complaints Committee or the Local Complaints Committee. The inquiry report has to be issued within 10 days from the completion of the inquiry. Thereafter the employer is bound to act on the recommendations of the committee within 60 days. Now the appeal if any goes to the Tribunal or Court.The situation for appeal may arise in three circumstances viz, an action for misconduct, no action by the employer, and punishment for the frivolous complaints.
Section 10 provides the scope and power for conciliation. It states that the Internal Committee or, as the case may be, the Local Committee, may, before initiating an inquiry under section 11 and at the request of the aggrieved woman take steps to settle the matter between her and the respondent through conciliation. This means that the efforts for conciliation are made before the inquiry is initiated. This is not binding upon the victim. She can choose not to go for conciliation and initiate the suit.
We need to deliberate on the fact whether there is any room for arbitration in India and whether there is any latent story behind this conciliation. As far as conciliation is concerned, as already discussed, the employee is not bound by it but there might be circumstances where she can be pressurized to settle the matter. A number of factors such as position in the department, the risk of losing the job, demotion, hostile attitude, impact on the performance of work play the role in deciding whether the employee wants to go for conciliation. There have been numerous instances where the employees were forced to resign because they initiated suits against the harassment. But with respect to arbitration, the situation has not reached up to that level where the employee is forced to accept the arbitration clause and settle accordingly. Even in United States of America amendment was brought to do away with it. As of now, the courts handle the harassment cases if the inquiry committee does not give satisfactory remedy. The scope of Arbitration in sexual harassment cases in India is yet to spread its roots because we have not accepted such mechanism since the beginning in our laws. In my opinion, matters as important and delicate as harassment should not be dealt by arbitration because the deterrent effect of the IPC may lose its purpose. It may also end up in the creation of ‘market’ where disputes like these are let go by mere compensation or any other benefits. This might not prove to be a healthy practice in the long run.
The utility of introducing alternative dispute resolution mechanism was never understood to be beneficial for solving the matters related to sexual assault and harassment. It is essential to know the object and purpose of the law as a catalyst for social change. Moreover, by giving a right to an employer of including a clause of arbitration in cases of sexual harassment will surely infuse the imbalance in the approach of handling such serious offenses. Arbitration has always been a feasible option for commercialized transactions. On the other hand, to bring it under the garb of labor law will entail certain consequences for which India is not ready with a mitigation plan as on the present day. It will be highly condemned and criticized by the legal luminaries and fraternity in toto. Therefore, a specialized law commission has to be commissioned for the in-depth analysis of this area of law.