Drafting an enforceable arbitration agreement in California demands a nuanced understanding of both statespecific and federal laws. ADR stands for Alternative Dispute Resolution.It refers to processes that are "alternatives" to having a trial to resolve your dispute. Mandatory arbitration agreements refer to agreements that an employee must sign as a condition of employment. Bay Area Employee Rights Advocacy and Representation. These days, it is common for employers to include an arbitration agreement in the documents for new hires. Arbitration of certain issues, such as insurance coverage and contribution under Labor Code section 5500.5, took effect on January 1, 1990.