Governor Jerry Brown recently signed Senate Bill 1241, which will prohibit employers from requiring employees who primarily work and reside in California to sign, as a condition of employment, employment agreements with choice-of-law provisions that require adjudication of claims outside of California. Under the law, any contract provision violating the prohibition will be voidable at the employee’s request and disputes arising over voided provisions must be adjudicated in California under California law. An exception exists for contracts entered into by an employee who was individually represented by legal counsel while negotiating the terms of the agreement.

The law comes into effect on January 1, 2017 and covers not only new contracts, but also those modified or extended after the new year. To view the full text of SB 1241, please click here.