Uber's new rules on arbitration for sex-related claims face 1st test

A former employee is suing Uber less than a week after the company announced it is doing away with a rule that forced arbitration on passengers, drivers or employees who come forward with claims of sexual harassment or assault.

The lawsuit, filed by software engineer Ingrid Avendaño, alleges years of discrimination based on her gender and race, sexual harassment and a hostile work environment, retaliation for taking a medical leave and pay inequality, among other allegations. The suit will be the first test of the company’s new policy.

According to the lawsuit, Avendaño, who worked for the company from February 2014 to June 2017, "was repeatedly faced with discriminatory treatment and sexually explicitly conduct specifically directed at female employees."

"Each time Avendaño raised concerns regarding unlawful conduct, she was met with Uber's entrenched disregard for the rights of its women employees and a refusal to take effective steps to prevent harassment," the lawsuit said. "Worse, she suffered blatant retaliation, including denial of promotions and raises, unwarranted negative performance reviews, and placement on an oppressively demanding on-call schedule that had detrimental effects on her health."

"Uber's failure to take effective remedial measures for her to resign," the suit added.

An Uber spokesperson responded to the lawsuit in a statement to ABC News: “Uber is moving in a new direction. Last week, we proactively announced changes to our arbitration policies. And in the past year we have implemented a new salary and equity structure based on the market, overhauled our performance review process, published Diversity & Inclusion reports, and created and delivered diversity and leadership trainings to thousands of employees globally.”

Uber’s chief legal officer, Tony West, detailed the “changes” to the “arbitration policy” in a letter that was published on the company’s website on May 15, 2018.

West wrote that the company "will no longer require mandatory arbitration for individual claims of sexual assault or sexual harassment by Uber riders, drivers or employees."

This update, he continued, will "give riders, drivers and employees options to continue taking accusations of harassment or assaults into arbitration, but also allow for a confidential forum such as mediation or let the case play out in open court."

Avendaño was also a part of lawsuit filed against Uber in October of 2017. In the suit, she and two other female employees alleged that Uber violated the Equal Pay Act and the Private Attorney General Act.

The suit, which sought class-action status, said the company's policies, patterns and practices allowed "female engineers and engineers of color [to] receive less compensation and [be] promoted less frequently than their male and/or white or Asian American counterparts.”

Uber agreed in March to a $10 million settlement to be distributed among hundreds of victims but Avendaño, who removed herself from the complaint, opted out the settlement to pursue her own individual claims, her lawyer Jennifer Schwartz, a partner at Outten & Golden LLP, told ABC News.

Uber has denied all wrongdoing and agreed to implement a number of different business practices, including diversity and inclusion training, as part of the settlement, which is awaiting final court approval.

Schwartz said Avendaño chose to pursue individual action because “the magnitude and scope of her claims were greater and different than those claims in the class action lawsuit.”