We’ve noted before that AB 51 – the California legislature’s latest attempt to attack workplace arbitration – has significant legal flaws. On December 30, 2019, US District Judge Kimberly Mueller granted a temporary restraining order to prevent the legislation from taking effect on January 1, 2020. Judge Mueller ruled that the employer groups bringing the litigation have shown a likelihood of irreparable injury if relief is not granted and that a restraining order is in the public interest. Specifically, they showed that there are serious questions as to whether the law is enforceable and that allowing it to take effect will be unduly disruptive. In addition, the court ruled that the harm to the state of restraining the statute from taking effect until these issues can be more fully addressed is minimal.
A further hearing is scheduled for January 10, 2020. You can read the order here.
What does this mean for employers? There are obviously pros and cons of mandatory workplace arbitration programs (as we’ve discussed). But if you have such a program, now is not the time to scrap it.