California Prohibits Mandatory Employee Arbitration


Michael S. Kun and Kevin Sullivan, attorneys in the Employment, Labor & Workforce Management practice, in the firm’s Los Angeles office, authored an article titled “California Prohibits Mandatory Employee Arbitration,” in TLNT. The article is based on a post from the firm’s Wage and Hour Defense Blog.

Following is an excerpt:

California’s Governor Gavin Newsom has signed legislation which effectively outlaws mandatory arbitration agreements with employees — a new version of a bill that prior Governor Jerry Brown had vetoed repeatedly while he was in office. The new law goes into effect on January 1, 2020.

AB 51 not only prohibits mandatory arbitration agreements (with limited exceptions), but also outlaws arbitration agreements in which employees must take an affirmative action to escape arbitration, such as opting out. Further, as the statute is written in broad terms that extend to waivers of statutory “procedures,” it appears to extend not just to arbitration of an employee’s claims, but also to waivers of jury trials and of class actions.