BAN ON MANDATORY ARBITRATION AGREEMENTS EFFECTIVE JAN 1, 2020

AB 51 effectively bans mandatory arbitration agreements entered into between employers and employees.  The bill specifically prohibits an employer from requiring an applicant or employee to waive any right, forum or procedure for any employer violations of the Fair Employment and Housing Act (FEHA) and the Labor Code.  The Legislature was clear this was intended to target arbitration agreements, in which employers and employees generally agree to resolve employment disputes outside of court.  The bill also prohibits retaliation and discrimination against an applicant or employee who refuses to enter into such agreements.

The bill would not apply to any arbitration agreements entered into prior to January 1, 2020.