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9th Circuit Allows California’s Ban on Mandatory Arbitrations to Proceed

On September 15, 2021 in a split decision, the U.S. Court of Appeals for the Ninth Circuit vacated a preliminary injunction that prohibited California from enforcing AB 51, which was signed into law in 2019 (Chamber of Commerce of the United States of America, et al. v. Bonta, et al., No. 20-15291 (9th Cir. Sept. 15, 2021)).

Slated to take effect January 1, 2020, AB 51 added a provision to both the Labor Code and the Government Code that prevented employers from requiring employees to, as a condition of employment, sign arbitration agreements about employment-related disputes under the Labor Code or the Fair Employment and Housing Act. But in February of 2020, the U.S. District Court held that AB 51 was invalid under federal law and issued a preliminary injunction preventing California from enforcing any part of AB 51.

In its September 15 decision, the 9th Circuit held that AB 51’s language was not preempted by the Federal Arbitration Act (FAA), as the FAA was concerned only with enforceability of already existing arbitration agreements; the FAA does not regulate pre-agreement conduct. According to the 9th Circuit, the FAA doesn’t regulate whether arbitration agreements may be mandatory or voluntary; it regulates whether an executed arbitration agreement is enforceable.

Because AB 51 purports to regulate pre-agreement conduct (as it prohibits an employer from requiring execution of an arbitration agreement as a condition of employment) and doesn’t explicitly state that mandatory arbitration agreements are unenforceable, the 9th Circuit held in its split decision that AB 51 is neither preempted nor invalidated by the FAA. In fact, the 9th Circuit intentionally punted on this issue, stating that later courts will have to decide whether voluntariness of an arbitration agreement is a generally applicable contract defense not limited to arbitration agreements.

However, the dissent to the majority’s opinion, written by Justice Sandra Segal Ikuta, highlights prior U.S. Supreme Court decisions that found state laws invalid under federal law because the FAA preempts not only overt attempts to make arbitration agreements unenforceable, but also workarounds that, in effect, create a similar hostility to arbitration agreements. According to Justice Ikuta, the concept of penalizing an employer’s conduct during the agreement’s formation is exactly the burden on forming arbitration agreements that the FAA preempts.

What to Do When COVID-19 Long-Haulers Seek Exemptions from Vaccine Mandates

COVID-19 long-haulers—those experiencing long-term effects of COVID-19—who seek disability-related exemptions from mandatory vaccination policies are straining employers’ accommodation processes.

The Occupational Safety and Health Administration’s (OSHA’s) anticipated emergency temporary standard—which will mandate employees of businesses with at least 100 workers get vaccinated or submit to weekly testing—will result in more employers requiring vaccines. OSHA’s rule will almost certainly affirm that employers must accommodate employees who refuse to be vaccinated based on a medical exemption or sincerely held religious belief, said Paula Ketcham, an attorney with Schiff Hardin in Chicago. With the rise of the delta variant, more small employers also are starting to mandate vaccinations.

What if an employer believes that a COVID-19 long-hauler is requesting an exemption simply because the person is opposed to vaccinations rather than having a medical condition that would put that person at risk if he or she was vaccinated?

“Employers should always balance empathy for its staff with the safety of its overall workforce,” said David Epstein, SHRM-SCP, director of domestic human resources at Doctors Without Borders in New York City.

“Those who ask for an exemption from the vaccine should be afforded a pathway to apply for an exemption for medical reasons, and the required interactive dialogue should take place as is required” by the Americans with Disabilities Act (ADA), Epstein noted. “After that dialogue takes place, there are two options: a reasonable accommodation, which could include working remotely, or termination of employment if your company requires the vaccine and working remotely causes an undue hardship under the ADA.”

October 2021 Seminar – Non-supervisor Harassment & Discrimination Prevention Training

Seminar Location: Online via Webinar

Date: Thursday, October 14th
Time: 9:00am – 10:30am

Price: $25 per person

Please reserve your spot no later than October 12th.
To reserve your spot, please email or use the following link:

If you experience any technical issues with the above link, please contact 24 hour cancellation notice is required. All employers with five or more employees are required to provide non-supervisory employees with at least one hour of sexual harassment prevention training (SB 1343) every two years.

For more information, contact our office at 916.444.6200 or your HR Consultant!

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