SACRAMENTO - The ability of employers and employees to resolve disputes quickly and effectively would be destroyed by a bill passed out of the Assembly late Thursday night, reports the Civil Justice Association of California and the National Federation of Independent Business (NFIB). Assembly Bill 858 (Kuehl) seeks to prohibit employment contracts from including arbitration agreements that allow employers and employees to settle disputes without entering into costly and time consuming court battles.

"Every business owner, CEO and employee should take note of the money, time, and frustration they save by resolving their disputes through arbitration," said John H. Sullivan, President of the Civil Justice Association of California. "If AB 858 is not defeated, all the benefits of this preferred method of dispute resolution will disappear on January 1, 2000."

A cornerstone of personal injury lawyers 1999 legislative agenda, AB 858 would prohibit employers and employees from entering into binding arbitration agreements except as part of a collecting bargaining contract. Employers who offer arbitration as a form of dispute resolution will be subject to a $5,000 fine.

"Prohibiting employer/employee arbitration agreements will devastate small-business in California," said Martyn Hopper, NFIB State Director. "Small-business employers and employees simply cannot afford the time or money involved in hiring lawyers and becoming embroiled in lengthy court battles."

The bill will now be sent to the Senate for consideration.