Ninth Circuit decides California employers can require employees enter mandatory arbitration agreements as condition of employment. Chamber of Commerce v Bonta, No. 20 15291, 9th Cir. February 15 2023, three judge panel found Assembly Bill 51, AB 51, preempted by federal law
The Federal Arbitration Act applies to arbitration agreements. California passed AB 51 to prevent employers from forcing employees to arbitrate certain workplace claims. The Ninth Circuit Court of Appeals put arbitration back in play in California for most employment disputes.
Ninth Circuit struck down AB 51, California statute that imposed criminal and civil penalties against employers who required employees to enter into arbitration agreement as condition of employment, finding statute to be unacceptable obstacle to the accomplishment of FAA.
Ninth Circuit Court of Appeals blocked a 2020 California law that attempted to prohibit employers from requiring employees and job applicants to agree to arbitration as condition of employment. Decision in Chamber of Chamber of Commerce of United States of America v. Bonta.
California employers that utilize arbitration agreements can breathe a sigh of relief, Ninth Circuit has finally ruled that a California arbitration law is preempted by the Federal Arbitration Act. AB 51 prohibits California employers from requiring employees to agree to arbitrate.