U.S. District Court Judge Kimberly Mueller just granted a preliminary injunction to block Assembly Bill 51 throughout future court proceedings, which will examine the enforceability of the new law.  This is welcome news for California employers because it means that the status quo remains in effect: Employers can continue to require arbitration agreements as a condition of employment for their employees unless and until the court rules otherwise.   

To recap the brief but controversial history of this new law, AB 51 was originally supposed to become effective on January 1, 2020 but this never happened.  Rather, in December of 2019, a coalition of businesses sought a temporary restraining order (TRO), which Judge Mueller granted, effectively putting the law on emergency hold until oral arguments earlier this month.  Following the oral arguments, Judge Mueller extended the TRO through today, January 31, 2020, to allow time for the parties to engage in further briefing.  As of today, the court granted a full preliminary injunction to last throughout further court proceedings to consider the issue of whether California’s AB 51 conflicts with the Federal Arbitration Act. 

For the time being, California employers can legally continue requiring employees to sign arbitration agreements.  However, whether AB 51 will prevent this practice in the future is uncertain.  And whether the new law ultimately will prevent mandatory arbitration agreements in the employment context remains to be seen in the coming weeks and months.