Binding Arbitration Ban R.I.P.? Not In California

The California State Assembly has, by a wide margin, passed a law banning mandatory arbitration clauses in employment contracts. This development comes on the heels of the Supreme Court’s decision in Epic Systems Corp. v. Lewis. What passage of this bill would mean in relation to that ruling is not clear, according to Jeanne Christensen, partner at plaintiff employment firm Wigdor LLP – because, she said in a San Francisco Chronicle article, the California bill does not address class actions, the issue at the heart of the Epic Systems ruling. The sponsor of the California bill, Lorena Gonzalez Fletcher (D-San Diego), invokes the MeToo movement, telling the Northern California Record that “forced arbitration, and non-disclosure agreements, have allowed serial offenders to get away with harassment.” Her bill has evoked strong opposition and counter-arguments from the business community. According to the newsletter of the business-friendly Civil Justice Association of California, studies find that “most of the working population (those making less than $60,000 annually) have difficulty gaining access to our court system for the simple fact that trial lawyers do not find their cases worth their time and expense.” The State Assembly is the lower house of California’s bicameral legislature, and the law now needs to be considered by the State Senate, which is generally considered the more liberal of the two bodies.