Decloedt v. Radnet: Sexual Harassment Claims Can Keep a Case Out of Forced Arbitration

In Decloedt v. Radnet Management, a California Court of Appeal demonstrated how the Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act can protect workplace claims from being forced into private arbitration.

Of course, the decision does not provide that every arbitration agreement is unenforceable. It does mean that when a worker sufficiently pleads a sexual harassment claim covered by the EFAA, a predispute arbitration agreement may not control the case.

What happened in Decloedt

Trevor Joseph Decloedt sued Radnet Management, Inc., RadNet, Inc., Radnet Managed Imaging Services, Inc., Joe Zambrano, and Susana Ceballos after his employment ended. The complaint brought 11 causes of action under California law, including FEHA claims for hostile work environment harassment and sexual harassment.

The defendants moved to compel arbitration based on an arbitration agreement Decloedt had signed at the beginning of his employment. They argued the Federal Arbitration Act and the agreement required arbitration of all employment-related claims.

The trial court denied the motion. The Court of Appeal affirmed.

Why the EFAA mattered

The EFAA became effective on March 3, 2022. In cases involving sexual assault or sexual harassment disputes, it creates an exemption from the Federal Arbitration Act for certain predispute arbitration agreements and joint-action waivers.

The court focused on whether Decloedt had alleged conduct that qualified as sexual harassment under California law. If he did, the EFAA could make the predispute arbitration agreement unenforceable with respect to the case.

The Court of Appeal relied on its prior decision in Liu v. Miniso Depot CA, Inc., which held that the EFAA can exempt an entire case from arbitration when the plaintiff asserts at least one sexual harassment claim subject to the Act.

Why sexual orientation harassment counted

The defendants argued the EFAA did not apply because harassment based on sexual orientation was not sexual harassment under FEHA, or, in the alternative, because Decloedt had not pleaded enough facts to show severe or pervasive harassment.

The Court of Appeal rejected those arguments. It held that harassment based on sexual orientation is a form of sexual harassment under FEHA.

The court also found the complaint alleged enough facts at the pleading stage. According to the opinion, Decloedt alleged that a coworker repeatedly made anti-gay comments, threatened him, pulled and touched his hair, and that reports to supervisors and HR did not stop the conduct. The court concluded those allegations were sufficient to plead severe or pervasive harassment because of his homosexuality.

What employees should take from the decision

If a workplace case includes sexual harassment or sexual assault claims, an arbitration agreement signed before the dispute arose may not automatically decide where the case must be heard.

For employees, the details matter. The court will look at the claims pleaded, the timing of the agreement, the alleged conduct, and whether the case relates to a sexual harassment or sexual assault dispute covered by the EFAA.

Employees should not assume a forced-arbitration demand is final just because an agreement exists in an onboarding packet, handbook, offer letter, or electronic signature platform.

Records that may matter

If an employer is trying to enforce an arbitration agreement in a case involving harassment, employees should make sure to preserve:

1. the arbitration agreement, offer letter, handbook, onboarding packet, and any electronic acknowledgment;
2. emails, texts, Slack or Teams messages, HR complaints, hotline submissions, and written reports about the harassment;
3. names of witnesses, supervisors, HR representatives, and anyone who received a report;
4. documents showing when the agreement was signed and whether the dispute had already arisen;
5. discipline, write-ups, schedule changes, leave records, termination paperwork, and personnel documents; and
6. any letter, court filing, or agency filing demanding arbitration.

These records can help an attorney evaluate whether the EFAA applies and whether the employer can force the case into arbitration.

When to seek legal guidance

You may want legal guidance if you experience sexual harassment, sexual assault, sex-based harassment, sexual orientation harassment, retaliation, discrimination, or wrongful termination.

Every case depends on the facts, the agreement, and the claims being asserted. Java & Jebreil can review the agreement and the workplace record so employees understand what arguments may be available before claims are sent to arbitration.