Facing pressure over high-profile allegations of sexual harassment, Google (GOOG, GOOGL) and other tech giants recently changed their policies of forcing those claims into arbitration rather than court.
These changes were cheered by employees, as mandatory arbitration tends to result in far smaller settlements for alleged victims of sexual harassment than cases that go before a jury. However, Google’s decision to make arbitration optional for individual sexual harassment and sexual assault claims does little to ensure claimants get their day in court, according to an attorney representing a former Google employee.
“Google’s change in policy is really a big nothing in terms of the actual ability of the employee to get civil justice,” San Francisco employment attorney Richard Hoyer told Yahoo Finance.
‘Sexual harassment claims alone will never see the light of day’
Hoyer represents former Google programmer Loretta Lee, who filed sexual harassment and discrimination claims against Google in February, before the company announced it would stop requiring that employees agree to mandatory arbitration.
“It’s more like a bait-and-switch,” Hoyer said of some of the new policies. “Employers seem to say, hey if you’re an employee and you’re worried about sex harassment don’t worry about it because you still have the right to sue in court.”
Technically, employees freed from mandatory arbitration of sexual harassment claims now do have the right to sue in court over those claims. However, under Google’s revised policy, all of the other claims a plaintiff may have, in addition to sexual harassment, are still subject to the mandatory arbitration, Hoyer said.
In California, that means plaintiffs must table their sexual harassment litigation until their related claims, such as retaliation, wrongful termination and discrimination — claims commonly brought in connection with sexual harassment suits — are resolved through arbitration. These related claims, such as retaliation, tend to result in more lucrative settlements than sexual harassment claims.
Because these more lucrative claims tend to help sexual harassment plaintiffs retain and ultimately afford a lawyer, employees seeking representation on sexual harassment claims, alone, are left without much leverage to bring their claim to court.
By themselves, sexual harassment claims allow only for the recovery of emotional damages, which can be both difficult to quantify and tough to predict.
“It’s not that easy if you’re an employee to get a lawyer to take your case,” Hoyer said, adding that his firm turns away 98% of the people who inquire about sexual harassment representation.
“In 20 years I’ve never had just a sex harassment claim,” Hoyer said. “There are always other claims going along with it.”
“Sexual harassment claims alone will never see the light of day in all likelihood,” he said.
‘We will make arbitration optional’
Hoyer’s client, Lee, alleges she was fired by Google after seven years when she informally complained that male co-workers engaged in harassment including spiking her drinks with whiskey, making lewd remarks, shooting Nerf balls and darts at her, showing up at her apartment with a bottle of liquor and hiding under her desk. Lee claims Google’s human resources department wrote her up when she refused to file a formal report, yet failed to remedy the situation.
When Google first dropped its mandatory arbitration policy following a global protest by Google employees in November, Hoyer requested retroactive application of the new policy to Lee’s pending case. Google’s counsel initially denied the request but later approved it.
In a November 16 email, Google’s lawyer said, “Google announced a prospective policy change that applies going forward to individual sex harassment and sex assault claims. This policy change does not apply retroactively to claims already compelled to arbitration.” At the time, Google’s lawyer suggested that Hoyer propose a settlement for Lee’s case “well below 6 figures,” or face arbitration.
In a request for details on which of Lee’s claims would be handled through mandatory arbitration, and which would be allowed to proceed in court, a Google representative told Yahoo Finance the company could not comment on active cases. However, that representative said the policy change applies to both former employees and current employees for matters not already in arbitration. That policy would appear to apply to Lee who, despite Google’s policy at the time, still filed her claim in a court of law. Indeed, Hoyer said the new policy has now been applied to Lee.
Google also pointed to CEO Sundar Pichai’s November memo announcing the policy change.
“We will make arbitration optional for individual sexual harassment and sexual assault claims. Google has never required confidentiality in the arbitration process and arbitration still may be the best path for a number of reasons (e.g. personal privacy) but, we recognize that choice should be up to you. You’re welcome to quote from this,” the memo says.
Google said the changes would not apply to certain cases because they had already been settled in arbitration or had already been compelled into arbitration.
“I want to ask you if you will voluntarily commit to expanding the policy of ending forced arbitration for any violation of a person’s rights, not just around sexual harassment, but really for all of your employers and your contractors,” Rep. Pramila Jayapal (D-WA) asked Pichai during a hearing before the House Judiciary Committee Tuesday.
“We are definitely looking into this further,” Pichai said. ” It’s an area where I’ve gotten feedback personally from our employees, so we are definitely reviewing what we could do…and happy to think about more changes here.”
As for other tech companies, Facebook (FB) ended its policy a day after Google announced its change. Square (SQ), Airbnb, eBay (EBAY), Lyft, Apple (AAPL) and Uber also dropped mandatory arbitration requirements this year. Microsoft was the first of the tech giants to make a move, terminating its forced arbitration policy nearly a year earlier in December 2017, and throwing its support behind a federal bill proposed by Senators Lindsey Graham (R-SC) and Kirsten Gillibrand (D-NY) that would invalidate all required arbitration in sex discrimination disputes.
Microsoft told Yahoo Finance its new policy dispenses with mandatory arbitration for all potential discrimination and harassment claims that could be brought by employees who have arbitration clauses in their employment contracts. The policy is less restrictive than Google’s, which exempts only sexual harassment and sexual assault claims.
“At Microsoft we’ve never enforced an arbitration provision relating to sexual harassment,” a December 19 memo from company said. “[E]ffective immediately, we are waiving the contractual requirement for arbitration of sexual harassment claims in our own arbitration agreements for the limited number of employees who have this requirement.”
A 1994 study by the Merit Systems Protection Board, cited by the Washington Post, estimated that over two years, sexual harassment within federal workplaces cost the government $327.1 million, which would be valued around $556 million today.
The Bureau of Labor statistics declined a request from Senators Graham and Gillibrand to undertake an updated study on the prevalence and cost of sexual harassment.
“Part of the justice that is available to sexual harassment victims is actually getting the chance to tell their story in front of a jury,” Hoyer said. “There’s a real restorative justice aspect that’s supposed to happen.”
“That is basically wiped out by Google’s policy, unless the plaintiff were going to sacrifice the money claims in order to get their day in court.”
Alexis Keenan is a New York-based reporter for Yahoo Finance. She previously produced live news for CNN and is a former litigation attorney. Follow her on Twitter at @alexiskweed