BUSINESS
05/15/2018 06:03 am ET Updated May 15, 2018

Uber Ends Forced Arbitration In Individual Cases Of Sexual Assault, Harassment

Victims will be free to go to court -- but a few caveats remain.

Uber will no longer force individual victims of sexual harassment or assault into forced arbitration, the ride-hailing company’s chief legal officer Tony West announced in a blog post Tuesday morning. 

Riders, drivers or employees who have been sexually assaulted or discriminated against are free to choose the venue they want to pursue their claims against the company, wrote West, who was a top-ranking official in the Justice Department during the Obama administration and has spoken previously about the pervasiveness of sexual harassment and gender discrimination.

“It’s important to give sexual assault and harassment survivors control of how they pursue their claims,” West wrote in the post, noting the company’s need to regain the public’s trust. “Whatever they decide, they will be free to tell their story wherever and however they see fit.”

The move comes less than three weeks after 14 women, who said they were sexually assaulted by their Uber drivers, penned an open letter to the company’s board urging it to allow them to pursue justice in an open courtroom, rather than in arbitration.

“Silencing our stories deprives customers and potential investors from the knowledge that our horrific experiences are part of a widespread problem at Uber,” the women wrote. “This is not doing the ‘right thing,’” they said, alluding to the company’s new motto: “We do the right thing. Period.”

The letter drew widespread media coverage, including over the issue of forced arbitration. The app’s terms of service require any rider with a complaint against the company, even of sexual assault, to commit to arbitration, essentially private courtrooms where a company typically has the edge in any litigation.

West, who did a stint at PepsiCo before joining Uber, credits the new motto in his post on Tuesday, explaining that in order to actually do the right thing the company must now act with “transparency, integrity, and accountability.”

Victims can now decide whether to pursue their case in open court or through mediation or arbitration, he wrote. And when survivors settle cases with Uber, the company will no longer require them to remain silent about what happened to them as part of the deal, he added.

Uber also said that it would publicly release a safety report that will include data on sexual assaults and other incidents that occur on the Uber platform.

The moves are effective immediately, the company said, and apply to all cases currently pending against the company. Those who previously signed non-disclosure agreements will still be bound by those NDAs.

“[Uber CEO] Dara [Khosrowshahi] recently said that sexual predators often look for a dark corner,” West wrote. “Our message to the world is that we need to turn the lights on.”

Tony West, now Uber's chief legal officer, back in 2014 when he worked in the Justice Department under Eric Holder.
Andrew Harrer/Bloomberg via Getty Images
Tony West, now Uber's chief legal officer, back in 2014 when he worked in the Justice Department under Eric Holder.

One other tech company ― Microsoft ― has gotten rid of forced arbitration in harassment lawsuits. But Uber’s move is sure to affect far more people, as millions use the service each year.

On Tuesday afternoon, Uber’s closest competitor, Lyft, followed its lead and made a similar announcement. 

“Today, 48 hours prior to an impending lawsuit against their company, Uber made the good decision to adjust their policies,” a Lyft spokesperson said in an email to HuffPost. “We agree with the changes.”

Lyft said it was ending its forced arbitration policy for sexual assault victims, whether they’re riders, drivers or employees. Like Uber, the company would still force class actions into arbitration. Lyft also said it would no longer require confidentiality in settlement agreements and plans to release data on sexual assaults.

The company said it did not have an estimate of how much the change will cost and declined to say how many harassment and discrimination cases it has pending.

Uber’s new policy only applies to individual cases. Victims and survivors who wish to band together and bring class action litigation against the company will still be barred from doing so. For its part, Uber contends that the vast majority of the suits filed against it are at the individual level.

Other riders with complaints against the company ― outside the realm of harassment and discrimination ― will still be held to the fine print in the app’s terms of service agreement, requiring that disputes be settled via arbitration. 

Uber also said it now supports federal legislation that would allow individuals to opt out of arbitration in cases of sexual assault and discrimination. A bipartisan bill like that was introduced earlier this year with the help of Gretchen Carlson, the former Fox News host who was able to sue the company’s chairman and CEO despite an arbitration clause in her contract. 

“I’m proud to see companies joining our fight to end arbitration to give more women a voice in harassment and assault cases and unveil the secrecy,” Carlson told HuffPost. “I’m hopeful more companies will follow suit.”

Earlier this year, Facebook told HuffPost it was considering whether to support that legislation ― and defended its use of arbitration. All 50 state attorneys general have expressed support for the bill, known as the End Arbitration Act for Sexual Harassment.

In the meantime, the fate of many of those women’s assault cases is far from clear. Nine of the 14 women who wrote that open letter are currently suing the company and have asked a California court for class-action status for their case.

The women will now be free to pursue their assault charges in court, but only on an individual level. They’re also suing Uber for misleading advertising and fraud ― and the company said those claims would still have to be arbitrated.

“Our hope is that Uber ending forced arbitration for victims of sexual assault will begin a process to reduce future suffering by women passengers,” Jean Christensen, the lawyer representing the nine victims. “Uber has made a critical step in this direction, but preventing victims from proceeding together, on a class basis, shows that Uber is not fully committed to meaningful change.  Victims are more likely to come forward knowing they can proceed as a group.

“This is the beginning of a longer process needed to meaningfully improve safety.”

Moving to disclose data on rapes and sexual assaults is risky for the company, West acknowledged in an interview with The New York Times. He said he struggled with the decision because he knows it will be “disturbing,” according to the Times. Uber is a large company and it’s fairly easy to lodge a complaint against it. Also, there’s no standard on how to report such incidents, the company noted.

Uber still hasn’t made one key demand: Tightening its driver background checks by running fingerprints through FBI and DOJ databases. 

Uber has “so much money that they are willing to allow customers to sue them in court for what happens to them, but they are not willing to make the changes which would make the customers safe,” said Christensen.

Uber disputes the usefulness of fingerprint checks and has pointed out that it has made a raft of changes to tighten up safety over the past year.

Uber also said it will continue to force other disputes into arbitration, including when a passenger is injured due to driver negligence.

Uber’s reputation took a serious hit in the last several years after a series of public gaffes, reports of sexual assaults by drivers that were mishandled and a sexual harassment scandal that felled Uber’s co-founder and former CEO Travis Kalanick.

In light of the numerous high-profile sexual harassment and assault cases across industries in recent months, West’s post also references the Me Too movement and Time’s Up, the coalition of women in Hollywood formed to fight sexual harassment. Uber announced that it created its new policy by consulting with women’s groups and advisers including Tina Tchen, Michelle Obama’s former chief-of-staff and one of the founders of the Time’s Up Legal Defense Fund.

This article has been updated to include additional comments from Lyft, Christensen and Carlson.

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