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LC: Hello everyone, thank you for joining us for  this installment of California Employment News,   an informative video and podcast resource  offered by the Labor and Employment Group   at Weintraub Tobin. My name is Lukas Clary,  and I’m a shareholder in the firm’s labor   and employment group. I am joined today  by my partner Meagan Bainbridge. Today,   we will be discussing the state of mandatory  arbitration agreements in California employment,   and the impact of a recent 9th  Circuit decision, U.S. Chamber of   Commerce v. Bonta, on their permissibility. Meagan, before we dig into the Bonta case,   why don’t you give a little background on how  we got to the issue that this case took up? MB: Well, where to begin? I don’t think it  will come as a surprise to anyone watching   or listening to this episode that arbitration  agreements in the employment context have a   long and tortured history in California. For a  long period of time, arbitration agreements in   employment was permissible. That is, until  2019 when the legislature passed AB 51,   which prohibited employers in California from  requiring employees to sign an arbitration   agreement as a condition of employment or  employment-related benefits concerning disputes   arising under the California Fair Employment  and Housing Act or California Labor Code.   Almost immediately, AB 51 was challenged,  including by the Chamber of Commerce,   who sought to prevent the bill from taking  effect, alleging that AB 51 was preempted by   federal law that precludes states from limiting or  interfering with the use of arbitration agreements   to resolve disputes. Since that case was filed  in 2019, and a preliminary injunction was granted   preventing the bill from taking effect, California  employers have been in limbo. Well, not anymore.   The Ninth Circuit just issued it’s long awaited  ruling. Lukas, what did the Ninth Circuit say? LC: So, the 9th Circuit has had their  arms around this case for a while. After   initially upholding AB-51 in a 2021 in a 2-1  ruling, the 9th Circuit elected to revisit   that ruling. The issue the 9th Circuit decided  was whether AB-51 was preempted by the Federal   Arbitration Act. The U.S. Supreme Court has  long held that any state law that restricts   arbitration is preempted by the FAA and  therefore unenforceable. California’s   legislature tried to circumvent that precedent  with AB-51 by prohibiting only the formation   of arbitration agreements rather than the  enforcement of them. The 9th Circuit was   not persuaded by those efforts, finding that  AB-51 was preempted in its entirety by the FAA.  So, Meagan, now that AB-51 has been struck  down, where do employers go from here? MB: For now, the good news is that arbitration  agreements are still enforceable. California   employers may continue using mandatory arbitration  agreements for existing employees and new hires.   However, please keep in mind, employers still  need to ensure that their mandatory arbitration   agreements are drafted correctly to comply  with other legal requirements and restrictions.   Whether an arbitration agreement is right  for a particular employer may well depend on   the employer and industry. Further, we are all  still waiting on the Aldoph v. Uber decision,   which will determine whether employees who  have entered into arbitration agreements may   properly bring representative PAGA actions.  Lukas, what can you tell us about that case? LC: Yes, so Adolph v. Uber is a case examining  a different aspect of arbitration agreements in   the employment context. There has been another  ongoing battle between the California courts and   legislature, on the one hand, and federal courts,  on the other, regarding the enforceability of   arbitration agreements that force employees to  waive representative PAGA claims. Very quickly,   PAGA, short for Private Attorney General Act,  is a statute in the California Labor Code that   allows aggrieved employees to pursue Labor Code  violations on behalf of themselves and all other   aggrieved employees. California courts have long  held that arbitration agreements that force PAGA   claims into arbitration are not enforceable. But that recently changed, at least potentially,   in last year’s US Supreme Court decision  in Viking River Cruises v. Moriana. There,   the Supreme Court held that a valid agreement to  arbitrate workplace claims binds an employee to   arbitrate even their own individual PAGA claims.  And, once employees are forced to arbitrate their   individual claims, Viking River held that  they lack standing to pursue representative   PAGA claims in court. This effectively meant  that a well-drafted arbitration agreement   could preclude employees from pursuing  PAGA claims on a representative basis.  Enter the California Supreme Court and Adolph v.  Uber. That case will decide whether the plaintiff,   an Uber driver, still has standing to pursue  representative PAGA claims in court even if forced   to arbitrate his individual claims. If the Uber  court upholds the Viking River decision, it will   be a big win for employers. On the other hand,  if the court disagrees with that part of Viking   River, then PAGA claims in court will not be going  away anytime soon. So, big decision looming there. I know we’re all anxiously awaiting the  court’s decision. That does it for today.   Thank you for joining us. You can continue to  find California Employment News on our blog at   .theLElawBlog.com, and wherever you listen to  your favorite podcasts. We’ll see you next time.