United States District Judge Kimberly J. Mueller today issued a temporary restraining order enjoining enforcement of AB 51 (Gonzalez; D-San Diego), pending the court’s resolution of CalChamber’s motion for preliminary injunction.
The judge set a hearing on the motion for preliminary injunction for January 10, 2020 at 10:00 a.m.
AB 51, which was set to go into effect January 1, 2020, criminalizes the commonplace practice of arbitration agreements entered into between workers and employers for claims brought under California’s Fair Employment and Housing Act and the Labor Code.
CalChamber requested urgent intervention from the Court due to the fact that businesses that may continue to use arbitration agreements in the good-faith belief that it is preempted and unconstitutional would face significant harm that cannot be corrected once inflicted. Under the Labor Code, businesses that violate the restrictions imposed by AB 51 could face imprisonment of up to six months.
CalChamber, representing a large coalition of employers in the litigation, argues that in addition to being protected under federal law, arbitration is effective and has been repeatedly shown to be fair to both sides and preferable to court proceedings.
The California Chamber of Commerce (CalChamber) is the largest broad-based business advocate to government in California. Membership represents one-quarter of the private sector jobs in California and includes firms of all sizes and companies from every industry within the state. Leveraging our front-line knowledge of laws and regulations, we provide products and services to help businesses comply with both federal and state law. CalChamber, a not-for-profit organization with roots dating to 1890, promotes international trade and investment in order to stimulate California’s economy and create jobs. Please visit our website at www.calchamber.com