Employment Agreement Protection Now Available for California Employees

Employment Agreement Protection Now Available for California Employees
Choice of Law and Venue

Effective January 1, 2017, an employer cannot require an employee who primarily resides and works in California, as a condition of employment, to agree to a provision that would do either of the following:

  1. Require the employee to adjudicate outside of California a claim arising in California.
  2. Deprive the employee of the substantive protection of California law with respect to a controversy arising in California.

Any provision of a contract that violates this law is voidable by the employee, and if a provision is rendered void at the request of the employee, the matter shall be adjudicated in California and California law shall govern the dispute.

The employee may be awarded attorney’s fees for enforcing his or her rights.

This section does not apply to a contract with an employee who is individually represented by counsel in negotiating choice of law and venue for adjudicating disputes.

Most California employees do not enter into written employment agreements.  For those employees that have a written employment contract, this statute is designed to protect employers that insert contractual provisions that the laws of another state shall control and the location for any lawsuit shall be outside of California.  This is done for the convenience of the employer and, in some cases, because the employer believes the employer will obtain a more favorable result.