Gov. Gavin Newsom late Thursday signed legislation outlawing mandatory workplace arbitration agreements, thrilling labor advocates and the plaintiff's bar and inviting a certain lawsuit from business groups.

Assembly Bill 51 does not bar employment-based arbitration outright. It does block employers from requiring workers to settle their claims privately as a condition of accepting a job or continuing employment.

"When both parties choose arbitration freely, it can be a highly effective tool," the bill's author, Assemblywoman Lorena Gonzalez, D-San Diego, said in a statement. "But it doesn't work when corporations say you won't be hired unless you sign away your rights."

By signing AB 51, Newsom has signaled a new receptiveness in the governor's office to arbitration restrictions.

Legislative Democrats have seen their efforts to curb the use of mandatory arbitration blocked in recent years by intense lobbying from the California Chamber of Commerce and other business groups, as well as opposition from Democratic Gov. Jerry Brown. The former governor vetoed legislation similar to AB 51 last year, saying the bill "plainly violates federal law."

Jennifer Siebel Newsom, Gov. Newsom's wife, lobbied for last year's arbitration bill, which was framed as an effort to stop companies from shielding sexual harassment claims from public light. Siebel Newsom did not publicly campaign for this year's measure.

A spokeswoman for the state Chamber of Commerce, which argued the legislation is federally preempted, declined to comment Thursday night.

The new law will only apply to employment contracts entered into or modified after Jan. 1, 2020.

Newsom on Thursday signed a number of other workplace-related bills closely watched by employment lawyers:

Workplace claims deadline extended. Assembly Bill 9 gives employees three years instead of one to file claims of illegal employment practices with the state. The bill's author, Assemblywoman Eloise Gómez Reyes, D-San Bernardino, argued that the current one-year time limit is too short for victims who do not understand their rights or fear retaliation. The bill was sponsored by the Consumer Attorneys of California.

Construction industry standards. Senate Bill 530 will require the state Division of Labor Standards to develop a harassment and discrimination prevention policy specifically for the construction industry. Brown vetoed a nearly identical bill last year.

Lactation accommodations. Senate Bill 142 mirrors a San Francisco ordinance that requires employers to provide a lactation room—other than a bathroom—for workers. Employers can be fined $100 for each day a worker is denied appropriate break time and adequate space to express milk.