BILL ANALYSIS Ó
AB 465
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ASSEMBLY THIRD READING
AB
465 (Roger Hernández)
As Amended April 30, 2015
Majority vote
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|Committee |Votes |Ayes |Noes |
| | | | |
| | | | |
|----------------+------+----------------------+---------------------|
|Labor |5-2 |Roger Hernández, Chu, |Harper, Patterson |
| | |Low, McCarty, | |
| | |Thurmond | |
| | | | |
| | | | |
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SUMMARY: Imposes specified restrictions on contractual waivers of
rights and procedures under the Labor Code. Specifically, this
bill:
1)Provides that a person shall not require another person to waive
any legal right, penalty, remedy, forum, or procedure for a
violation of any provision of the Labor Code, as a condition of
employment, including the right to file and pursue a civil
action or complaint with, or otherwise notify, the Labor
Commissioner, state agency, other public prosecutor, law
enforcement agency, or any court or other governmental entity.
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2)Provides that a person shall not threaten, retaliate, or
discriminate against another person on the basis that the other
person refuses to waive any legal right, penalty, remedy, forum,
or procedure for a violation of the Labor Code, including the
right to file and pursue a civil action or complaint with, or
otherwise notify, the Labor Commissioner, state agency, other
public prosecutor, law enforcement agency, or any court or other
governmental entity.
3)Provides that any waiver of any legal right, penalty, remedy,
forum, or procedure for a violation of the Labor Code, including
the right to file and pursue a civil action or complaint with,
or otherwise notify, the Labor Commissioner, state agency, other
public prosecutor, law enforcement agency, or any court or other
governmental entity shall be knowing and voluntary and in
writing, and expressly not made as a condition of employment.
4)Provides that any waiver of any legal right, penalty, remedy,
forum, or procedure for a violation of the Labor Code that is
required as a condition of employment shall be deemed
involuntary, unconscionable, against public policy, and
unenforceable. Nothing in this subdivision shall affect the
enforceability or validity of any other provision of the
contract.
5)Provides that any person who seeks to enforce a waiver of any
legal right, penalty, remedy, forum, or procedure for a
violation of the Labor Code shall have the burden of proving
that the waiver was knowing and voluntary and not made as a
condition of employment.
6)Specifies that this bill shall apply to any agreement to waive
any legal right, penalty, remedy, forum, or procedure for a
violation of the Labor Code, including an agreement to accept
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private arbitration, entered into, altered, modified, renewed,
or extended on or after January 1, 2016.
7)Provides that in addition to any other remedies available, a
person who violates this section is liable for a civil penalty
not exceeding $10,000 per individual for each violation of this
bill and reasonable attorney's fees.
8)Makes related legislative findings and declarations
FISCAL EFFECT: None. This bill is keyed non-fiscal by the
Legislative Counsel.
COMMENTS: According to the author and the sponsor, the goal of
this bill is to protect workers from being coerced into signing
contracts to waive the right to take labor violations to the Labor
Commissioner or to court and submit all claims to the employer's
arbitrator. Therefore, this bill is designed to ensure that
waivers of important employment rights and procedures arising
under California law are made voluntarily and with the consent of
the employee.
This bill largely tracks the provisions of AB 2617 (Weber),
Chapter 910, Statutes of 2014, legislation introduced last year
and signed into law by Governor Brown, which imposed specified
restrictions on future contractual waivers of rights under the
Ralph Civil Rights Act and Bane Civil Rights Act.
This bill is sponsored by the California Labor Federation,
AFL-CIO. They state that there are very few remedies available to
most low-wage workers when their rights are violated. They can
file a claim to the Labor Commissioner or they can find access to
counsel through a collective legal action. Yet employers have
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found a way to circumvent these avenues. Increasingly, companies
are requiring workers to sign waivers of the right to take claims
to the Labor Commissioner or to court and instead requiring them
to take any claims to the employer's private arbitrator. They
argue that this bill would provide some basic protections to these
workers. It would require that these agreements be voluntary and
not required as a condition of employment. It would require that
a waiver of rights be voluntary. Lastly, it would prohibit
employers from threatening, retaliating, or discriminating against
workers for refusing to sign such a waiver. These are core tenets
of contract law and are consistent with the Supreme Court's
direction that such contracts should not be entered into under
coercion.
Opponents argue that this bill directly conflicts with prior and
recent rulings from both the California and United States Supreme
Courts, which have consistently stated any state law that
interferes with the Federal Arbitration Act is preempted.
Opponents also argue that adequate protections already exist for
mandatory, pre-dispute employee arbitration agreements. Opponents
contend that arbitration provides an effective and efficient means
to resolve employment-related claims and that this bill will send
disputes into the overburdened and underfunded judicial system.
Analysis Prepared by:
Ben Ebbink / L. & E. / (916) 319-2091 FN: 0000329
AB 465
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