The Tipping Point?

The Fifth Circuit's recent decision in Jones v Halliburton Co has attracted quite a bit of attention, as well it should, as the facts are heart-wrenching and the potential legal implications are fascinating.

Jamie Leigh Jones was a young woman working for Halliburton/KBR when, following an instance of sexual harassment, she was given the choice of either losing her job, or moving to Iraq. She chose Iraq and, prior to her departure, the company gave her a contract to sign, one in which she agreed to arbitrate any and all claims relating to her employment. Pretty standard agreement, but what happened next was anything but the standard expatriate employment agreement.

On her first day, Jones, who had allegedly been promised private quarters, found herself assigned to barracks with her male co-workers. On her third day, Jones complained of the sexually hostile situation in the barracks and asked again for a "safer" location. And, on her fourth day, after a party, Jones was allegedly drugged, beaten, and gang-raped in her own sleeping quarters. She went to Halliburton medical personnel, where her rape kit was mislaid, and was placed under armed guard, without means of communication to the outside world. Eventually, her supervisors gave her a choice of "get over it" or go home, but without a guaranteed job. Jones chose a third route, the court system, alleging a number of claims, including assault and battery, intentional infliction of emotional distress, negligent hiring and supervision and false imprisonment. Halliburton invoked the arbitration clause.

The Fifth Circuit slammed the brakes on Halliburton's attempt to duck public scrutiny, finding that Jones could proceed to trial on the aforementioned claims. Simply put, none of the four claims were sufficiently "related to" Jones' employment for the arbitration agreement to hold sway. Halliburton argued that the claims were related to her employment because she lived in employer-provided housing and because, in raping Jones, the perpetrators violated the same employment policies that governed Jones. But the Fifth Circuit ruled that the mere fact that the perpetrators acted in ways contrary to their employment did not mean that the plaintiff was acting in any way related to her employment. Furthermore, unlike in Jones' workers' compensation claim, in which she was allowed to recover because her employment created the "zone of special danger" that led to her injuries, her tort claims did not have a significant relationship to her employment.

Does this case represent the limits of arbitration agreements? One fervently hopes so, as Halliburton's attempts to invoke the clause in connection to these claims is nothing short of shameless. Yet, other district courts, when faced with virtually the same fact pattern and the same defendant, ruled that tort claims arising from a rape were related to employment. The case law is decidedly unsettled on this point, but the hope here is that the unusually strong language employed by the Fifth Circuit represents a push back by the courts against attempts by corporations, like Halliburton, to deprive their employees of their day in court.