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While a litigant alleging sex discrimination under Title VII of the Civil Rights Act of 1964 generally must exhaust all administrative remedies prior to bringing suit, there is no like requirement for an employee pursuing Title VII claims through binding arbitration.
In CACI Premier Technology, Inc. v. Faraci, No.1:06cv991, 2006 WL 3692615 (E.D. Va. Dec. 12, 2006), Faraci was hired by CACI in March 2004 to work in Germany as an Intelligence Analyst. Following several unwanted sexual advances and other misconduct by Cornelius, her supervisor, Faraci was transferred to a position for which she not qualified, and was subsequently terminated.
Faraci filed a charge with the Equal Employment Opportunity Commission (EEOC) regarding Cornelius. Following her termination, she initiated arbitration proceedings against CACI. Faraci prevailed in arbitration, but CACI argued that the award was invalid due to the arbitrator's manifest disregard of the law. Specifically, CACI complained that Faraci had not exhausted administrative remedies with regards to other coworkers and clients.
The Court rejected CACI's arguments and left the arbitration award undisturbed. The parties' med-arb agreement appeared to supplant any requirement that Faraci first file a complaint with the EEOC. In fact, nothing in the language of Title VII indicated that exhaustion was a condition precedent for arbitration proceedings. Accordingly, the Court agreed with the arbitrator's finding that Faraci's EEOC complaint against Cornelius was "unnecessary."
As for the finding that CACI was vicariously liable for the actions of its supervising employee, the Court noted that whether or not Cornelius was an "actual decisionmaker," the courts have held employers liable for supervisors where their "reports and recommendations were merely rubber-stamped by the formal decisionmaker." Given Cornelius's influence over Faraci's career path, the Court rejected the argument that the arbitrator had manifestly disregarded the law in ruling for Faraci.
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