The Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act (EFAA) exempts sexual harassment claims from arbitration. A California Court of Appeal has held that harassment based on an employee's sexual orientation qualifies as sexual harassment for the purposes of EFAA. The practical effect of this decision is that an employee’s claims for harassment based on their sexual orientation are now exempt from arbitration and must be litigated in court. You can read the full decision HERE.
What Happened at RadNet?
Trevor Joseph Decloedt was a patient service representative at RadNet, a medical imaging company in Los Angeles County. When RadNet hired him, he signed an agreement requiring arbitration of employment disputes.
According to his complaint, a coworker named Susana Ceballos began targeting him in early 2022 because of his sexual orientation, telling him he "shouldn't be gay" because "it's sinning." He claimed her hostility escalated from derogatory comments to a threat to kill him and to pulling his hair, and that in November 2022 she yanked his hair so violently that he hid in the restroom to get away from her.
Decloedt sued for harassment, discrimination, wrongful termination, and related claims. RadNet moved to compel arbitration under his signed agreement.
Decloedt opposed the motion under the EFAA. Since its passage March 2022, the EFAA has exempted lawsuits with sexual harassment causes of action from arbitration. Whether the EFAA applied here turned on a single question: does harassment based on sexual orientation count as sexual harassment? The trial court agreed with Decloedt and ordered that the lawsuit was exempt from arbitration based on the EFAA.
The Court of Appeal's Decision
The Court of Appeal confirmed the trial court’s decision and held that a sexual harassment cause of action based on comments or actions about a person’s sexual orientation is exempt from arbitration.
The Court’s decision focused on whether claims for harassment based on sexual orientation were considered sexual harassment claims under FEHA. RadNet argued that because FEHA lists "sex" and "sexual orientation" as separate protected characteristics, sexual orientation harassment is a distinct category, like harassment based on race or disability. The Court rejected that reading. It followed the reasoning of the U.S. Supreme Court in Bostock v. Clayton County (2020), and explained that an employer cannot target an employee for being gay without taking the employee's sex into account, so orientation-based harassment is harassment because of sex. The Court added that sexual harassment does not require sexual advances or sexual language; hostility toward an employee because of their sexual orientation is enough.
What Does Decloedt Mean for California Employers?
- Arbitration agreements have real limits in California. Many California employers require new hires to sign arbitration agreements as a standard condition of employment. Under Decloedt, however, an employee who adequately alleges harassment based on sexual orientation may invoke the EFAA to avoid arbitration, and courts have held the exemption reaches the employee's entire case, keeping claims such as wrongful termination or retaliation in court as well. Employers should understand that a growing number of claims are exempt from arbitration and plan accordingly.
- Policies and trainings should treat orientation-based harassment as sexual harassment. Programs that treat it as a separate or lesser category, or assume sexual harassment requires sexual conduct, no longer reflect how California courts view these claims.
*Special thanks to CDF law clerk Grace Pating for her research and contributions to this article.
