The state director for California’s leading small-business association today reacted with perplexity over Gov. Gavin Newsom’s signing, yesterday, of Assembly Bill 51 into law, a law aimed at essentially prohibiting arbitration of labor and employment claims as a condition of employment.
“I don’t know if Governor Newsom realized that AB 51 is likely preempted by federal law and signed it anyway for political points or if he genuinely believes it will overcome federal barriers, given how much California has lately enjoyed thumbing its nose at environmental and immigration policies emanating from Washington, D.C.,” said John Kabateck, California state director for the National Federation of Independent Business.
“The Federal Arbitration Act prohibits any state statute that seeks to interfere with, limit, or discriminate against arbitration, which is why his predecessor, Gov. Jerry Brown, vetoed a similar bill, saying ‘this bill plainly violates federal law,’” said Kabateck.
“We knew our objections to the bill, that it would add significant delays in the resolution of disputes, that it would flood the already crowded dockets of civil courts, that it needlessly and unfairly exposes small-business owners to criminal liability wouldn’t cut any mustard with him and AB 51’s legislative backers. Not in a state where trial lawyers are the most powerful lobby and not in a bill that offered them a new revenue stream in the form of private rights of action,” added Kabateck.
“But surely AB 51’s clash with federal law should have put paid to it. As we all learned in sixth-grade civics class, federal law supersedes state law, which supersedes local law. In the end, AB 51 will have been one giant exercise of nothingness.”
Keep up with the latest on California small-business at www.nfib.com/california or by following NFIB on Twitter @NFIB_CA or on Facebook @NFIB.CA
For more than 75 years, NFIB has been advocating on behalf of America’s small and independent business owners, both in Washington, D.C., and in all 50 state capitals. NFIB is a nonprofit, nonpartisan, and member-driven association. Since our founding in 1943, NFIB has been exclusively dedicated to small and independent businesses and remains so today. For more information, please visit nfib.com.
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