Eighth Circuit in Case of First Impression Rules Employee Does not Have to Arbitrate Claims She was Sexually Harassed and Raped by Chipotle Co-Worker

Chipotle Can't Force Arbitration of Workplace Rape Claim, US Court Rules

A U.S. appeals court on Monday said a former Chipotle Mexican Grill employee does not have to arbitrate claims that she was sexually harassed and raped by a coworker, because she sued the restaurant chain after a federal law took effect banning agreements to keep such claims out of court.

 

A unanimous three-judge panel, opens new tab of the St. Louis-based 8th U.S. Circuit Court of Appeals said the law that passed Congress with bipartisan support in 2022 applies to any lawsuit filed after it was enacted, rejecting Chipotle's claim that it only covers conduct that occurred after that date.

 

The ruling is the first of its kind by a federal appeals court and could salvage some pending cases and invite new ones involving conduct that occurred prior to the adoption of the law. A California state appeals court in January also said the federal ban applies based on the date a lawsuit is filed and not when the underlying conduct occurs.

 

The plaintiff says a coworker raped her in the bathroom at a Rochester, Minnesota, restaurant in 2021 after verbally harassing her for months, and that Chipotle failed to investigate or respond after she told a manager about the assault. She had signed an agreement to arbitrate employment-related disputes when she was hired, and initially sued Chipotle a few months after the federal law took effect. ***

 

Chipotle denied wrongdoing and moved to send the case to arbitration, citing the agreement the plaintiff had signed. But U.S. District Judge Donovan Frank in St. Paul last year said the agreement could not be enforced because of the federal ban on mandatory arbitration of harassment and assault claims.

 

The 8th Circuit on Monday affirmed. The law applies to "disputes" that arise on or after its effective date, and that term applies to an actual "conflict or controversy," such as a lawsuit, the court said.