Since its enactment in 2019, the ban against mandatory arbitration provisions in employment agreements contained in Section 12.7 of New Jersey’s Law Against Discrimination (NJLAD) has been on thin ice. And it appears to have just gotten thinner.
A recent New Jersey Appellate Division case—Antonucci v. Curvature Newco, Inc., et al. (A-1983-20)—has confirmed what the U.S. District Court in New Jersey already determined in 2021: Section 12.7 is preempted by the Federal Arbitration Act (FAA) and cannot prevent employers from including mandatory arbitration provisions in employment contracts.
To be clear, Section 12.7, which amended the NJLAD, contains no express prohibition against an employer requiring its employees to arbitrate claims arising from their employment, like discrimination and other claims. Rather, the amendment attempts to accomplish the same end by simply providing that “[a] provision in any employment contract that waives any substantive or procedural right or remedy relating to a claim of discrimination, retaliation, or harassment shall be deemed against public policy and unenforceable.” The law also prohibits the prospective waiver of any “right or remedy” under the NJLAD or “any other statute or case law.”
The New Jersey legislature’s scrupulous avoidance of the word “arbitration” in Section 12.7, however, did not save the amendment when it was scrutinized in the matter N.J. Civil Justice Inst. v. Grewal, Civ. No. 19-17518. Far from it, the U.S. District...
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