May 15, 2018 / 11:01 AM / 11 days ago

Uber, Lyft scrap mandatory arbitration for sexual assault claims

(Reuters) - Ride-hailing companies Uber Technologies Inc [UBER.UL] and Lyft Inc scrapped mandatory arbitration to settle sexual harassment or assault claims, giving victims several options to pursue their claims including public lawsuits.

Uber’s decision on Tuesday comes after several high-profile scandals and is a step in the right direction, according to several legal experts, but does not address class action lawsuits.

Chief Executive Officer Dara Khosrowshahi has unveiled a series of safety measures to restore Uber’s brand and image since taking the top job last August.

Victims were previously required to enter into confidentiality agreements as part of arbitration to settle claims, which prevented them from speaking publicly about the facts surrounding any sexual assault or harassment.

They can now settle claims through mediation, where they can choose confidentiality; in arbitration, where they can choose to maintain their privacy while pursuing their case; or in court, Uber said in a blog post.

"We commit to publishing a safety transparency report that will include data on sexual assaults and other incidents that occur on the Uber platform," Uber's chief legal officer, Tony West, wrote in the blog here

“So moving forward, survivors will be free to choose to resolve their individual claims in the venue they prefer.”

Lyft also removed the confidentiality requirement for sexual assault victims and ended mandatory arbitration for individuals. “This policy extends to passengers, drivers and Lyft employees,” it said.

Jeanne Christensen, a lawyer at Wigdor LLP who has been handling sexual harassment cases against Uber, agreed with the ride-hailing company’s move.

“It’s one step toward making a change, but just bringing the issue into the open doesn’t solve the problem,” Christensen told Reuters.

Uber did not provide details on the number of sexual harassment cases that are pending or have been settled, but when contacted by Reuters it said it will not revisit past cases that have been settled through the confidentiality agreement.

Uber became the second major company to end forced arbitration clauses, after Microsoft Corp said here in December victims would no longer need to settle cases privately.

“It is a move in the right direction but the problem is the arbitration agreement prevents class action lawsuit which is essential for a policy change,” said Veena Dubal, associate professor of law at the University of California, Hastings.

Uber is currently facing a class action lawsuit in the United States for poor driver vetting that has led to a series of sexual harassment incidents, including rape.

FILE PHOTO: The logo of Uber is pictured during the presentation of their new security measures in Mexico City, Mexico April 10, 2018. REUTERS/Ginnette Riquelme/File Photo

Reporting by Arjun Panchadar and Laharee Chatterjee and Anirban Paul in Bengaluru; Editing by Bernard Orr and Saumyadeb Chakrabarty

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