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Facebook Scraps Mandatory Arbitration of Sexual Harassment Claims

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The Wall Street Journal reports that Facebook became the latest technology company after Microsoft (MSFT - Free Report) , Uber and Alphabet (GOOGL - Free Report) to remove sexual harassment from the mandatory arbitration clause in its company policies.

“There’s no question that we’re at a pivotal moment,” Lori Goler, Facebook’s VP of people said in an interview with the WSJ. “This is a time when we can be part of taking the next step.”

"Today, we are publishing our updated Workplace Relationships policy and amending our arbitration agreements to make arbitration a choice rather than a requirement in sexual harassment claims," a company representative told CNBC.

Companies normally include mandatory arbitration clauses in their policies so disputes with employees can be resolved cheaply, quickly and efficiently. Moreover, since arbitration proceedings are required to remain private, the company’s reputation and that of its leaders are protected. In many cases, this is advantageous for employees as well because court cases tend to drag on and often, delayed justice is like no justice at all.

The problem with including sexual harassment in the mandatory arbitration clause is that there is a good chance that justice will be denied, first because higher level employees have better bargaining power; second, because they have the scope to choose or influence the arbitrator and third, a wrong decision whether in favor of or against the accused can’t be appealed.

Facebook has also changed its policy on office dating with directors and higher level employees now required to disclose when they are dating a colleague and not just when they are dating someone they are supervising.

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