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December 03, 2021

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December 02, 2021

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California’s Ban on Mandatory Employment Arbitration Stayed for Now

California AB 51’s ban on mandatory employment arbitration remains stayed for now.  AB 51 was passed in fall 2019 and essentially prohibits employers from requiring an applicant or employee to consent to mandatory arbitration for FEHA and Labor Code claims. The law was to take effect on January 1, 2020, discussed in our blog post here. As expected, a number of business groups such as United States and California Chambers of Commerce challenged the statute as preempted by the Federal Arbitration Act (“FAA”) and in late December secured a temporary restraining order (“TRO”) staying the ban’s enforcement.

Today the challengers asked the court for a preliminary injunction to continue the stay pending the outcome of the lawsuit. At the hearing in the Eastern District of California, Judge Kimberly Mueller requested additional supplemental briefing by later this month after which the court will determine whether the stay will remain in effect until the Federal Arbitration Act preemption issue has been resolved.

For now, it remains lawful for employers to require applicants and employees to sign employment arbitration agreements. Mintz will continue to monitor all AB 51 challenges until the final court rulings and remains available to assist employers with compliance.

©1994-2021 Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C. All Rights Reserved.National Law Review, Volume X, Number 10

About this Author

Jennifer Rubin Employment Attorney Mintz

Jen draws on 30 years of experience crafting legal solutions to employment challenges. Her clients include small and large businesses and individual representation of executives. She advises technology, financial services, publishing, retail, professional services, and health care companies seeking regulatory, litigation, and compliance advice. She divides her employment practice between wage and hour compliance and trial practice, with a focus on class actions, trade secrets and employment mobility disputes, and the defense of discrimination, retaliation and other disputes arising from...

Audrey Nguyen, Mintz Levin, Corporate counseling lawyer, employment litigation attorney

Audrey works on counseling, employment litigation and other regulatory matters.

Before attending law school, Audrey worked as a government relations analyst for the US subsidiary of Tesco. There she tracked California county and city regulations and ordinances; met with state assembly members, senators, and their policy advisors to discuss proposed legislation; and managed corporate sponsorships.

She served as a Mintz Levin Summer Associate in 2015.