IMPORTANT NEW LAW REGARDING ARBITRATION OF EMPLOYMENT CLAIMS
Governor Newsom signed into law AB 51, which becomes effective January 1, 2020.
For agreements entered into, modified, or extended on or after January 1, 2020, AB 51 will prohibit any business from requiring that a job applicant or employee waive any right, forum, or procedure for a violation of the FEHA or Labor Code, including any requirement that an individual “opt out” or take affirmative action to preserve such rights.
AB 51 prohibits any threatened or actual retaliation against an individual who refuses to consent to the prohibited requirements. AB 51 provides for both injunctive relief and attorney’s fees to any plaintiff who proves a violation.
There is uncertainty as to how AB 51 and the Federal Arbitration Act will be squared, and whether AB 51's severability clause will be sufficient to avoid preemption.