CHA News Article

New Employment Arbitration Ban Blocked Until Jan. 31
For CEOs, in-house counsel, human resources executives

A new law banning pre-dispute employment arbitration agreements, set to take effect Jan. 1, was temporarily blocked last month by a lawsuit challenging its validity. At a Jan. 10 hearing, the temporary restraining order was extended to Jan. 31.

The law — Assembly Bill 51 (2019) — prohibits employers from requiring employees to sign a pre-dispute arbitration agreement as a condition of employment or continued employment. It applies to any agreement entered into, modified, or extended on or after Jan. 1. Until Jan. 31, the government may not enforce the law to the extent it applies to arbitration agreements covered by the Federal Arbitration Act.

At the Jan. 10 hearing on the request for a preliminary injunction, the court extended the order until the end of the month to allow the parties to file supplemental briefings addressing jurisdiction, including standing, and their positions on the severability of the law’s provisions.

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