Are Mandatory Employment Arbitrations Falling Out of Favor?

Last week, Activision Blizzard announced that it was going to waive its mandatory arbitration provisions in sexual harassment and discrimination cases.

Your first question is probably “What is Activision Blizzard?” Well, you might not recognize the company from its name (though people of a certain generation may associate the first part of the name with Atari game consoles), you probably recognize some of its brands:

• Call of Duty

• World of Warcraft

• Candy Crush

Lest you think the company is a half-dozen Gen Zers sitting around a collapsible plastic table, the company is publicly traded (NASDAQ) and had revenues north of $8 billion last year.

This past summer, the company was hit with a slew of employee complaints focusing on “constant sexual harassment” and discrimination. Conditions were so bad that one employee committed suicide, allegedly due to the harassment she received. The company was initially dismissive of these complaints and, in response, almost one-third of the employees wrote an open letter demanding accountability from leadership. They then staged a walkout.

With the company’s announcement last week, the employees now have some accountability. In addition to the CEO taking a pay cut of over $151 million (until conditions improve), the company made its announcement about arbitrations. Clearly, the company has joined the growing trend away from mandatory arbitrations.

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