California 2020 Employment Arbitration Laws

It goes without saying how important it is to read something before you sign it. We often “agree” to the terms and conditions to the new games we download on our devices, not worrying too much about what actually we agreeing to. However, there are agreements that are more serious in nature that require our full attention to its terms and conditions. Employment agreements/contracts are one of the most important documents we need to read very carefully.

The new California Employment Arbitration Laws outline the following:

Employment Arbitration Agreements Waiver.

Assembly Bill 51 bans employers from requiring employees or applicants to waive any right, forum or procedure under the Fair Employment and Housing Act or Labor Code as a condition of employment. It also prohibits employers from retaliating or threatening employees who refuse to waive such rights. The new law will apply to agreements entered into, modified or extended on or after Jan. 1, 2020, but does not apply to post-dispute settlement or negotiated severance agreements.

Employers should be aware that due to the placement of the statute in the Labor Code, a violation is considered a misdemeanor.  

Employer action: There is still much controversy surrounding this statute because it violates the Federal Arbitration Act that preempts state laws that attempt to regulate or restrict arbitration agreements. Because of the risk of possible criminal action, employers who wish to continue to implement arbitration agreements and employers who currently have agreements in place are highly encouraged to review any current arbitration agreements with legal counsel.

Enforcement of Arbitration Agreements

Employees or consumers will be eligible for certain remedies under SB 707 should a drafting party breach an arbitration agreement by failing to pay the costs and fees required to initiate the arbitration. The bill also requires the court to impose a monetary sanction on a drafting party.  If a company failed to pay the arbitration fees in a consumer or employment arbitration, it would be a material breach and it would allow the employee or consumer to proceed in court and requires the court to impose sanctions.

Employer action: Employers should consult with legal counsel on the implications of new arbitration laws.

Anti-discrimination training for temporary and seasonal workers

Senate Bill 530 delays until Jan. 1, 2021, the completion of sexual harassment prevention training for seasonal, temporary or other employees hired to work for less than six months.

All employers with five or more employees are required to provide the new training required under SB 1343, which was signed into law by former Gov. Jerry Brown. That bill set an initial compliance deadline of Jan. 1, 2020. In September, Gov. Newsom signed legislation that extended the training completion deadline for most employees to Jan. 1, 2021, but the extension did not apply to temporary, seasonal or other workers hired to work for less than six months. With the passage of SB 530, employers now have until Jan. 1, 2021, to provide the required sexual harassment prevention training to all of their workers, whether full-time or temporary.

Because implementing new training requires time to research and hire a qualified trainer as well as time to complete the training, employers should plan to train all workers before the end of 2020 to be compliant with the new law by the January 2021 deadline.

CDA has covered the new training requirements in detail in the Update and on cda.org.