CALIFORNIA CLOSE TO BANNING EMPLOYMENT ARBITRATION AGREEMENTS

 

The California Legislature is poised to dispense with a cost-effective and expedient method of resolving employment disputes.  Specifically, Assembly Bill 3080 seeks to prohibit any person or business from conditioning employment, or any employment-related benefit, on any applicant for employment or employee agreeing to the binding arbitration of disputes that involve any alleged violation of any provision of the California Fair Employment and Housing Act.  The bill also includes a prohibition against arbitration agreements that would require an employee to opt out of arbitration.  AB 3080 further prohibits an employer from retaliating against an employee who refuses to sign an arbitration agreement.  A prevailing plaintiff enforcing his or her rights under the proposed law would be entitled to reasonable attorney’s fees.  As presently written, the law would apply to all contracts entered into, extended or modified after January 1, 2019.

 

AB 3080 is now on the Governor’s desk awaiting his signature.  Governor Brown vetoed a similar bill in 2015.  In so doing, Governor Brown indicated that such a law would be in conflict with the Federal Arbitration Act (FAA).  However, it remains to be seen if he will have the same opinion in the face of considerable support from the #MeToo Movement, plaintiff’s attorneys and other groups who disfavor private arbitration. 

 

AB 3080 also seeks to prevent any person or employer from conditioning employment, or any employment-related benefit, on any applicant for employment, employee, or independent contractor from disclosing to any person an instance of sexual harassment that the employee or independent contractor suffers, witnesses, or discovers in the workplace or in the performance of the contract, or otherwise opposing any unlawful practice, or from exercising any right or obligation or participating in any investigation or proceeding with respect to unlawful harassment or discrimination.

https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=201720180AB3080