California bill would prohibit forcing employees into arbitration

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Posted by Legal Team On August 15, 2022

California state lawmakers are considering banning mandatory arbitration clauses for employees.

The #MeToo movement, which has shone much-needed light on the problem of sexual harassment in the workplace, could be leading to significant legislative changes in California. As the Mercury News reports, a proposed law, AB 3080, would prohibit employers from forcing employees to agree to mandatory arbitration clauses. Critics of mandatory arbitration clauses contend that they are designed to silence victims of sexual harassment, discrimination, and wage theft.

The controversy over mandatory arbitration

Arbitration is a way of settling disputes between two parties (such as between an employer and employee) without going to court. The arbitration process resembles the court process in some ways, but a significant difference is that it occurs entirely in private whereas lawsuits heard in court are public. In many cases, arbitration has significant benefits, since it is usually cheaper and faster than going to court.

However, arbitration is only fair when both parties agree to it. Currently, many employees are subject to mandatory arbitration clauses in their employment contracts. As the Orange County Register reports, about 56 percent of all private sector non-union workers in the United States are subject to mandatory arbitration clauses. The clauses bar employees from suing their current or former employers for all sorts of legal claims, including those brought forward on the basis of Title VII of the Civil Rights Act, the Fair Labor Standards Act, the Americans with Disabilities Act, and the Family and Medical Leave Act. Instead, workers are forced into an arbitration process that, critics say, favors the employer and keeps allegations of harassment and discrimination secret.

Banning mandatory arbitration

A bill currently being debated by California state lawmakers, however, could change all that. AB 3080 would prohibit employers from forcing people to sign a mandatory arbitration clause as a condition for either gaining or keeping their jobs. The bill would not just apply to sexual harassment claims either; it would prohibit mandatory arbitration clauses for all workplace complaints, such as wage theft and discrimination.

The bill has yet to become law, however, and it is certainly possible that if it does succeed it will look a bit different than it currently does. Furthermore, the bill would not apply retroactively, meaning that employees already bound by mandatory arbitration clauses would continue to be so. If passed in its current state, the bill will affect 67 percent of private employers in California.

Employment law help

Harassment, discrimination, and violations of workers’ rights are unacceptable. Unfortunately, many employees who have suffered such harassment and discrimination often feel powerless to get the justice they deserve. However, help is available. An employment law attorney can assist workers in a number of ways, including by showing them what their legal options may be and possibly helping them pursue claims against a former employer.