What outlawing mandatory arbitration means for employees

Experiencing discrimination or harassment in the workplace can be both shocking and overwhelming. You may wonder how you should move forward to get justice, but in the past, you may not have had a choice. For years, employers in California could choose precisely how employees could file claims against them with mandatory arbitration agreements. This may all be changing, thanks to a new law.

Employers could previously require arbitration

In the past, California employers could establish mandatory arbitration agreements as a condition of hiring an employee. Many employees had to sign these agreements which essentially prevented them from taking certain legal actions if they experienced unfair actions in the workplace, such as:

• Discrimination;
• Sexual harassment;
• Wage and hour discrimination.

Under these mandatory agreements, employees were forced to handle their claims in closed-door, private arbitration with their employers.

 A new law banned mandatory arbitration agreements

Assembly Bill 51 was one of the many new employment laws passed in 2019. The law states that employers cannot force employees to:

• Enter into arbitration agreements;
• Waive their right to a jury trial; or
• Waive their right to file a class action.

Now, employers can only establish an arbitration agreement if an employee volunteers and agrees to enter such an agreement. They also cannot retaliate against any employees who choose not to enter an arbitration agreement. This law is so important because it gives you the freedom to pursue whatever legal action you wish if you experience illegal or inappropriate employment practices. Arbitration is certainly a valid process to resolve legal claims, but you deserve the right to choose how you wish to approach your case.

Note: The law is on hold

However, the law has been temporarily withheld. It was supposed to go into effect as of January 1, 2020, but an Eastern District judge placed a temporary restraining order on the law while the courts determine if the state law goes against the Federal Arbitration Act. Even though the law is under a temporary restraining order, you must understand your rights and options as an employee under this law, as well as all of the new employment laws going into effect this year in California.