Tag: HR consultants

No-hire or Non-solicitation of Employees Provisions–Are They Legally Valid?

by hrconsulting14

Here is a situation many companies are confronted with over time. You are consulting firm and your customers hire-out your consultants on a temporary basis. But you are finding recently your customers are taking away your consultants. In other words, after they finish one of the jobs, they are hired permanently as an employee and you lose the income for future work. Can you have your customers sign a contract which prevents this? In other words, inserting a No-hire or Non-solicitation of Employees clause?

The courts have not wavered from the strong public policy of the right of every employee to earn a livelihood under Business and Professions Code Section 16600. See Metro Traffic Control, Inc. v. Shadow Traffic Network (1994) 22 Cal.App.4th 853, 859 (“every citizen shall retain the right to pursue any lawful employment and enterprise of their choice”); Morlife, Inc. v. Perry (1997) 56 Cal.App.4th 1514, 1520 (“the important legal right of persons to engage in businesses and occupations of their choosing”).

The California Supreme Court has gone so far as to state that even “a mere limitation on an employee’s ability to practice his or her vocation … [that was] reasonably based” would fall afoul of section 16600. Edwards v. Arthur Andersen LLP, 44 Cal.4th 937, 81 Cal.Rptr.3d 282 (2008)

Key Points:

  • Courts overwhelmingly favor the right of a person to find the employment of their choosing.
  • Courts almost have a built-in bias against no-hire and similar provisions.

 

See VL Systems, Inc. v. Unisen, Inc. (2007) 152 Cal.App.4th 70. Company hired consultant for computer services. One of consultant’s employees was hired away by Company, which caused a lawsuit for violation of the no-hire agreement. That agreement had a liquidated damages provision. The employee of the consultant had never worked on any jobs for the Company and was just a random employee. The employee was hired away after answering an Internet ad. The court invalidated the no-hire provision and allowed the employee to be employed.

Key Points:

 

  • There is a better chance of stopping the employee if that person was actually working for the contracting party.
  • There is a better chance of the employee winning if he or she did the solicitation as opposed to the contracting party (because the contracting party would not be directly violating the provision it signed).
  • It is easier for the employee to win if he or she did not know about the no-hire provision.
  • It is not okay to “raid” the employment pool by taking away numerous employees

 

Golden v. Cal. Emergency Physicians Med. Grp., 782 F.3d 1083 (9th Cir., 2015). A doctor worked with a medical staffing company that specialized in staffing emergency rooms with physicians. The agreement signed by the doctor prohibited him from working for any of the hospitals that had been under contract. At the appellate level, the Court of Appeal held in favor of the employee and sent the case back to the District Court for re-determination.

Key Points:

  • Although there are many cases regarding non-solicit or non-compete, as to no-hire agreements, there is no definitive statement thus far from the California Supreme Court.
  • Regardless, the weight of authority and the trend modernly is to invalidate these provisions and allow the employee to work.
  • Other states allow the prohibitions if they are reasonable in nature. California cases say that any restraint is unlawful.

As you can see from the above, this is a highly technical issue, it’s best to receive legal advice you are confronted with it. And if you do insert a no hire or non-solicitation employees provision, make sure it is properly worded. Be careful, as this is one of the frequent issues confronted by HR consultants.

 

National Lien Law can act as your virtual Human Resources Consulting Firm–either replace your existing HR Department or augment it with our ongoing human resources consulting services. And, we are equipped to prepare any documents required (for example, termination notices, warnings, employment agreements/confidentiality/noncompete, employee handbooks, write-ups, responses to claims, wage and hour disputes, legal memos to management, response to attorney demands, legal investigations, help with arbitrations or language used in your emails and communications with employees). Services can be on a retainer basis, hourly or flat fee. Our human resources consultants have law degrees and 20+ years’ experience in human resources consulting. Or, simply give us a call for a free initial consultation. (800) 995-9434. Info.NationalLienLaw@gmail.com.

HR Consulting News–Meal and Rest Breaks

by hrconsulting14

 

Here is a situation that occurs quite frequently. We all know that in California and in many states, there is a requirement of giving employees rest and meal breaks. For example, a 10 minute rest break and a 30 minute meal break.

Take the example of the 30 minute meal break. Assume a buzzer or bell goes off two minutes before the end of the break to give time for employees to get their affairs in order and walk back to their workstations. Is that two minutes considered working? If so, the employees could argue they are shorted for the full 30 minute break. Actually, the case law is in favor of the company.

Labor Code Section 226.7(a) prohibits an employer from requiring an employee “to work during any meal or rest period mandated by an applicable order of the Industrial Welfare Commission.” But leisurely walking back to a workstation is not “work”.

We should also be mindful of the “de minimis rule” as outlined by the U.S. Supreme Court case of Anderson v. Mt. Clemens Pottery Co., 328 US 680 (1946). The Court held that “split-second absurdities are not justified by the actualities of working conditions” and “when the matter in issue concerns only a few seconds or minutes of work beyond the scheduled working hours, such trifles may be disregarded (at page 692).

Also on point, the Dept. Industrial Relations, DLSE Opn. Letter No. 1986.01.03 (Jan. 3, 1986) states in relevant part that the 10-minute net rest time excludes “any time to walk or otherwise travel to a place of rest”.

See also Lindow v. U.S. (9th Cir. 1984) 738 F.2d 1057, 1062 [noting for purposes of the Fair Labor Standards Act that “[w]hen the matter in issue concerns only a few seconds or minutes of work beyond the scheduled working hours, such trifles may be disregarded”]. In that case, workers sought over time for the approximate 15 minutes per day in which they reported to work early to review a logbook, exchange information about entries, be available to relieve outgoing employees, as well as opening and closing project gates. On de minimis grounds, the court denied the employees claims.

This same fact pattern was presented in the recent case of Chavez v. Angelica Corporation. Although an unpublished opinion, it is persuasive authority because of its comprehensive treatment of the issue and the statements by the trial judge.

Similar to our case, the defendant was a California laundry plant. Plaintiff was a nonexempt employee that brought a class action for alleged violations of rest and meal breaks. Specifically, claiming the employees were not given full 10 and 30-minute breaks because of a bell system identical to our situation: it rang two minutes before the end of rest or meal breaks to allow time to walk back to a workstation (at page 28). After an exhaustive analysis, the Court held there was no violation.

It began by stating: “Initially, we note Plaintiffs are unable to cite to any case or statute holding that employers must add walking time to meal and rest break times, nor have we found any such law based on our independent research” (at p. 24).

It is also instructive to consider comments made by the trial judge. It confirmed that the employees were not performing any working duties during the walking time:

The Court: Well, I mean, there’s no — I didn’t see any evidence of anybody saying, ‘we get a 10-minute break, but we are still working,’ you know. ‘We still have to work during part of that break period,’ or, ‘we have to start working before the ten minutes are up.’ I didn’t see any evidence of any of that (at p.12).

The Court: That’s your walking time. The net — when you start talking ‘net,’ you are talking the walking time. I didn’t see any evidence of anybody saying, ‘we get a 10- minute break, but during that break, we are actually working, still working,’ you know, ‘in production.’ I didn’t see any evidence to that (at p. 14).

The Court: No matter what, whether they use the bell or don’t use the bell, you know, your case on the production workers is predicated upon this idea that walking time is somehow a violation. I don’t see — one, I don’t think there’s any per se illegality. I don’t see any basis for that argument (at p.16).

So on this particular situation, there would be no violation of the employee’s rights. Make sure the company does not require any work to be done during the break.

www.HRconsulting.network can act as your virtual HR Independent Consultant. Our consulting services include: 1) acting as your virtual Human Resources department, 2) assisting your existing HR department personnel, 3) giving advice to other HR consultants or 4) simply providing outsourcing information to anyone interested in HR matters. And, we are equipped to prepare any documents required. Examples include: termination notices; warnings; counseling reports; progressive discipline procedures; write-ups; employment/confidentiality/noncompete agreements; employee handbooks; responses to employee demands; responses to wage and hour, overtime, rest/meal breaks, retaliation and hostile work environment disputes; memos to management; complaint investigations and reports; separation and severance agreements; settlement and release agreements; responses to sexual harassment claims; responses to discrimination claims; arbitration procedures (preparing a binding arbitration agreement, responses and other paper work, scripts and declarations for testimony, representatives to appear at hearings) and help with language used in your emails and communications with employees. Services can be on a retainer basis, hourly or flat fee. Our HR consultants have 20+ years’ experience in HR consulting. Or, simply give us a call for a free initial consultation. (800) 995-9434 (Ext. 1). Or email our parent company (attention Cliff): Info.NationalLienLaw@gmail.com.

HR Consulting Update: Keeping a Job Open After Returning From ADA Leave

by hrconsulting14

Consider a case in which an employee is taking unpaid ADA leave per direction from his doctor. Because the position must be filled in order to operate the business, it was filled by a floater. The question is what job needs to be offered the disabled employee after returning from ADA leave.

The EEOC and many courts take the position that a company must hold the employee’s job open as a reasonable accommodation while under an ADA leave of absence, unless doing so would create an undue hardship. Thus, if it would cause such a hardship, the person’s position can be replaced by another during the ADA leave. But even if this is the case, upon the employee’s return, there must be a good faith attempt to find a vacant and equivalent position to which he is qualified. In other words, reassigning him to another job.

But there are other HR exceptions to the requirement of offering another job upon return from disability:

  • Absence for a significant amount of time. Most reported court cases deal with a 1 to 2-year period. However, there is a case similar to ours in which only a couple months was considered an undue hardship. For example, in Walton v. Mental Health Association of Southeastern Pennsylvania,168 F3d 661 (3rd Cir. 1999), a 2 ½ month ADA leave was considered excessive and caused undue hardship to the employer. There the employee’s presence was essential and there was fear the program the employee was heading would fail for lack of funding and leadership.

 

  • Erratic and unpredictable leave. This is when the employee frequently starts and stops his or her job. This can be especially difficult from HR consulting standpoint.

 

  • Indefinite leave. This is usually when the employee will not commit and say how long they will be out or even give an indication whether they want to come back or not.

To sum up, there is good and bad news. The good news is the company can hardly operate without having a current operator and it would be an undue hardship to leave this position vacant.  There is a good argument that having the floater take over this position is proper.

The bad news, if you want to describe it that way, is that upon the return of the employee, there has to be in a good faith effort by HR to find some other equivalents job. But he needs the experience or the desire to take another job. For this reason, it is suggested the employee be emailed that his job has been taken over by another through necessity and that upon his return, offering him a couple alternative jobs if he wishes. Then let him make the decision. The email can state:

 

Dear ______________:

Thank you for providing us your doctor’s note you will remain on disability leave through _______________, 2019. As you know, your position was that of ______________. In order to maintain operations and produce product, we need someone performing that position at all times. As result, we have hired an individual to take over that job and it is no longer available.

However, upon your return, and we would be happy to offer you the following positions if you wish: __________________________________________. Please let us know your desires in this regard.

 

www.HRconsulting.network can act as your virtual HR Independent Consultant. Our consulting services include: 1) acting as your virtual Human Resources department, 2) assisting your existing HR department personnel, 3) giving advice to other HR consultants or 4) simply providing outsourcing information to anyone interested in HR matters. And, we are equipped to prepare any documents required. Examples include: termination notices; warnings; counseling reports; progressive discipline procedures; write-ups; employment/confidentiality/noncompete agreements; employee handbooks; responses to employee demands; responses to wage and hour, overtime, rest/meal breaks, retaliation and hostile work environment disputes; memos to management; complaint investigations and reports; separation and severance agreements; settlement and release agreements; responses to sexual harassment claims; responses to discrimination claims; arbitration procedures (preparing a binding arbitration agreement, responses and other paper work, scripts and declarations for testimony, representatives to appear at hearings) and help with language used in your emails and communications with employees. Services can be on a retainer basis, hourly or flat fee. Our HR consultants have 20+ years’ experience in HR consulting. Or, simply give us a call for a free initial consultation. (800) 995-9434 (Ext. 1). Or email our parent company (attention Cliff): Info.NationalLienLaw@gmail.com.

 

HR Consulting News–Working 7 Consecutive Days

by hrconsulting14

We are all familiar with the classic 40 hours per week and Monday through Friday scheduling. But there are situations, from an HR consulting point of view, in which the employer can legitimately ask for work seven days in a row if there is a bona fide business reason.

California Labor Code Section 551 states: “Every person employed in any occupation of labor is entitled to one days’ rest therefrom in seven.” In turn, Labor Code Section 552 states: “No employer of labor shall cause his employees to work more than six days in seven.”

Those sections do not apply “when the nature of employment reasonably requires that the employee works seven or more consecutive days, if in any each calendar month the employee receives days of rest equivalent to one day’s rest in seven (LC 554)”. For example, this would apply to retail employees who have to work longer consecutive days during the Christmas holidays.

From an HR standpoint, these provisions do not apply “to any employer or employee when the total hours of employment do not exceed 30 hours in any week or six hours in any one day thereof (LC 556).”

Two employees of Nordstrom sought to enforce these provisions in the California Supreme Court case of Mendoza v. Nordstrom (2017). For example, one of them claimed that they were forced to work 11 straight days. But in that time period, there were periods in which the work was less than six hours/day.

The court noted that the labor code sections above did not have a specification of civil penalties. This means the plaintiffs sought their penalties under the Private Attorney General’s Act (PAGA), which requires $200 per employee for each pay period, together with attorney’s fees and court costs, in which the labor code violation occurs.

For these reasons, HR consultants should be aware of these exceptions.

National Lien Law can act as your virtual Independent HR Consultant–either replace your existing HR Department or augment it with our ongoing HR consultation. And, we are equipped to prepare any documents required (for example, termination notices, warnings, employment agreements/confidentiality/noncompete, employee handbooks, write-ups, responses to claims, wage and hour disputes, legal memos to management, response to attorney demands, legal investigations, help with arbitrations or language used in your emails and communications with employees). Services can be on a retainer basis, hourly or flat fee. Our independent HR consultants have law degrees and 20+ years’ experience in HR consulting. Or, simply give us a call for a free initial consultation. (800) 995-9434. Info.NationalLienLaw@gmail.com.

Denying Service to Patrons of Places of Public Accommodation (Hotels and Restaurants)

by hrconsulting14

The question presented is whether a place of public accommodation, such as a hotel or restaurant, can deny service to a patron. This is important for HR consultants to understand, because it may impact whether your clients are sued for discrimination.

Take the example of a restaurant. This is clearly a place of public accommodation. In other words, the public may enter and use the facilities. In general, a place of public accommodation has the right to refuse service to a patron. But not on the basis of a protected class. In California, this includes: race or color, national origin or citizenship, religion or creed, sex, age, disability, pregnancy, genetic information, veteran status, marital status, sexual orientation or gender identity, medical condition, HIV status, political affiliations or status as a victim of domestic violence, assault or stalking. It appears Kevin is not a member of any protected class.

But California goes even further. In 1959 it enacted the Unruh Civil Rights Act, Civil Code Section 51, which states:

(b) All persons within the jurisdiction of this state are free and equal, and no matter what their sex, race, color, religion, ancestry, national origin, disability, medical condition, marital status, or sexual orientation are entitled to the full and equal accommodations, advantages, facilities, privileges, or services in all business establishments of every kind whatsoever.

This prohibits any form of arbitrary discrimination, even if it is not included in the protected classes described above.  In Harris v. Capital Growth Investors XIV (1991) 52 Cal.3d 1142 1152, it construed the Act to apply to several unexpressed classifications–namely, unconventional dress or physical appearance, families with children, persons under age 18, and homosexuality. (Harris, supra, 52 Cal.3d at p. 1155).

This allows a restaurant to exclude if there is a showing of good cause. The court observed in Stoumen v. Reilly, 37 Cal.2d 713:

 

Members of the public of lawful age have a right to patronize a public restaurant and a bar so long as they are acting properly and are not committing illegal and immoral acts. The proprietor has no right to exclude or reject a patron except for good cause, and if he does so without good cause, he is liable in damages.” Clearly, the law does not allow a business to arbitrarily exclude a prospective customer. In order for courts to determine what constitutes arbitrary discrimination, the court must examine whether the action taken by a business owner is reasonable and for good cause. Good cause is established when there is evidence of improper, illegal or immoral conduct by the customer that occurs on-premises and that is contrary to the public’s welfare or morals.

 

Thus, the exclusion can be proper if it is based upon neutral or economic factors (Harris, supra, 52 Cal.3d 1142, 1148), namely preventing a patron from further harassment of an employee. Other examples would be a patron causing a disturbance or committing some kind of illegal act.

Note also that California Penal Code Section 602.1 allows a restaurant owner to exclude a patron if that person would disrupt the business:

 

(a) Any person who intentionally interferes with any lawful business or occupation carried on by the owner or agent of a business establishment open to the public, by obstructing or intimidating those attempting to carry on business, or their customers, and who refuses to leave the premises of the business establishment after being requested to leave by the owner or the owner’s agent, or by a peace officer acting at the request of the owner or owner’s agent, is guilty of a misdemeanor, punishable by imprisonment in a county jail for up to 90 days, or by a fine of up to four hundred dollars ($400), or by both that imprisonment and fine.

 

Note also you do not need a sign to eject someone. Although it might be helpful from a practical standpoint, signs such as: “We reserve the right to refuse service at any time” are not technically required.

So as an HR consultant, bear these issues in mind and appropriately inform your clients.

 

National Lien Law can act as your virtual Human Resources Consulting Firm–either replace your existing HR Department or augment it with our ongoing human resources consulting services. And, we are equipped to prepare any documents required (for example, termination notices, warnings, employment agreements/confidentiality/noncompete, employee handbooks, write-ups, responses to claims, wage and hour disputes, legal memos to management, response to attorney demands, legal investigations, help with arbitrations or language used in your emails and communications with employees). Services can be on a retainer basis, hourly or flat fee. Our human resources consultants have law degrees and 20+ years’ experience in human resources consulting. Or, simply give us a call for a free initial consultation. (800) 995-9434. Info.NationalLienLaw@gmail.com.

California Employment Arbitration Provisions

by hrconsulting14

Just how far can you go in drafting a California arbitration provision for employer/ employee disputes? This is important information for HR professionals.

Under the California Armendariz decision, the employee must be given the same rights in arbitration as they would have in litigation. But for most companies, there are some exceptions. Waiving the right to consolidate or have a class-action in arbitration is one.  This is allowed by the US Supreme Court in ATT Mobility vs. Conception  131 S. Ct. 1740, 1750 (2011).

An agreement can also waive a jury trial. The argument is that arbitration, for example through the American Arbitration Association, almost never can provide for a jury trial. In other words, it is the nature of arbitration not to have a jury. It’s just not set up for that. So you probably will get by with this exception.

Examples of what rights cannot be waived would be damages for emotional distress, punitive damages, injunctive relief, declaratory relief or other examples.

An HR consultant should also know about a waiver of the employee being able to bring an action as a private attorney general under California Labor Code Sections 2698 – 2699.5 (for example penalties for over time etc., in which the employee brings the action on their behalf as well as others)? This is not allowed because of the California case of Iskanian vs. CLS Transportation, 59 Cal.4th 348 (2014) which prohibits such a waiver. But you can include the following provision:

A mutual agreement to arbitrate claims also means that both you and the Company forego any right either may have to a jury trial on claims relating in any way to your employment, and both you and the Company forego and waive any right to join or consolidate claims in arbitration with others not signatory or to make claims in arbitration as a representative or as a member of a class or in a private attorney general capacity, unless such procedures are agreed to by both you and the company.

 

www.HRconsulting.network can act as your virtual HR Independent Consultant. Our consulting services include: 1) acting as your virtual Human Resources department, 2) assisting your existing HR department personnel, 3) giving advice to other HR consultants or 4) simply providing outsourcing information to anyone interested in HR matters. And, we are equipped to prepare any documents required. Examples include: termination notices; warnings; counseling reports; progressive discipline procedures; write-ups; employment/confidentiality/noncompete agreements; employee handbooks; responses to employee demands; responses to wage and hour, overtime, rest/meal breaks, retaliation and hostile work environment disputes; memos to management; complaint investigations and reports; separation and severance agreements; settlement and release agreements; responses to sexual harassment claims; responses to discrimination claims; arbitration procedures (preparing a binding arbitration agreement, responses and other paper work, scripts and declarations for testimony, representatives to appear at hearings) and help with language used in your emails and communications with employees. Services can be on a retainer basis, hourly or flat fee. Our HR consultants have 20+ years’ experience in HR consulting. Or, simply give us a call for a free initial consultation. (800) 995-9434 (Ext. 1). Or email our parent company (attention Cliff): Info.NationalLienLaw@gmail.com.

HR Consulting News Update–Religious Affiliation on Job Application

by hrconsulting14

The question is whether there can be an optional question inserted in job applications as to whether Muslim individuals or similar persons would have a religious objection to delivering alcohol.

A quick check of the EEOC website indicates the following relevant passage:

Questions about an applicant’s religious affiliation or beliefs (unless the religion is a bona fide occupational qualification (BFOQ)), are generally viewed as non job-related and problematic under federal law . . .[O]ther employers (for example not churches or other religious organizations) should avoid questions about an applicant’s religious affiliation, such as place of worship, days of worship, and religious holidays and should not ask for references from religious leaders, e.g., minister, rabbi, priest, imam, or pastor.

In other words, a direct inquiry as to one’s religion would be prohibited. But what if you mention on employment applications, without asking about one’s specific religion, that they might be delivering alcohol products and asking if they would have a problem doing so? Could you be sued for doing so?

Unfortunately, it could go either way. Here are the two arguments:

  • There is no discrimination against religion–you are actually honoring it. You are simply giving them a “heads up” there may be difficulties with their beliefs in such deliveries. Isn’t that something that a prospective employee would like to know before joining the team?
  • You cannot ask an applicant about their religious beliefs, but here you are indirectly doing so. If they say they cannot make the deliveries, it is because of their religious beliefs so in essence you are making that inquiry. If they cannot do so, it gives you the right to deny the application. It may also come out in discovery that you have a number of Muslim workers that have objections (which you do not like) and that is the reason you have posed the question.

If you do want to broach the subject in the application, you might consider the following:

Optional Question: We do not make inquiries into an applicant’s religious denomination, religious affiliation, places of worship or religious holidays. Nor do we discriminate for or against any religion. We honor the religious beliefs of our employees, seek to accommodate them, but at the same time do not want you to be uncomfortable in performing certain services. As a disclosure, part of your duties may involve the lawful delivery of alcoholic beverages or marijuana paraphernalia. Without disclosing any religious denomination or belief, is this something you will not be able to do?

www.HRconsulting.network can act as your virtual HR Independent Consultant. Our consulting services include: 1) acting as your virtual Human Resources department, 2) assisting your existing HR department personnel, 3) giving advice to other HR consultants or 4) simply providing outsourcing information to anyone interested in HR matters. And, we are equipped to prepare any documents required. Examples include: termination notices; warnings; counseling reports; progressive discipline procedures; write-ups; employment/confidentiality/noncompete agreements; employee handbooks; responses to employee demands; responses to wage and hour, overtime, rest/meal breaks, retaliation and hostile work environment disputes; memos to management; complaint investigations and reports; separation and severance agreements; settlement and release agreements; responses to sexual harassment claims; responses to discrimination claims; arbitration procedures (preparing a binding arbitration agreement, responses and other paper work, scripts and declarations for testimony, representatives to appear at hearings) and help with language used in your emails and communications with employees. Services can be on a retainer basis, hourly or flat fee. Our HR consultants have 20+ years’ experience in HR consulting. Or, simply give us a call for a free initial consultation. (800) 995-9434 (Ext. 1). Or email our parent company (attention Cliff): Info.NationalLienLaw@gmail.com.

HR Consulting News: the ADA and Back Problems

by hrconsulting14

Question: What ADA accommodation is required under the ADA for back problems involving a degenerative disc?

Answer: Although the ADA does not have a specific list of medical conditions, there is a general definition of disability that involves an impairment substantially limiting one or more major life activities, which would clearly apply to her work situation.

As is well known, if there is such a disability, there must be a reasonable accommodation as long as there is not significant difficulty or expense. Here are some possibilities: a) preventing heavy lifting or strain upon the back muscles, b) longer breaks (for example, 5 minutes as opposed to 10 minutes), c) allow some work from home, d) an ergonomic chair or back brace, e) height adjustable desk, f) desktop organizers for easy access to files or g) a sit/stand computer workstation.

There is no such thing as leaving early and resting at home as a reasonable accommodation. If there is a reasonable accommodation, it should be at the premises.

You can offer the employee work at home under a telework program, but only if he/she is actually working exclusively for company business during those periods and she can accomplish her work duties.

www.HRconsulting.network can act as your virtual HR Independent Consultant. Our consulting services include: 1) acting as your virtual Human Resources department, 2) assisting your existing HR department personnel, 3) giving advice to other HR consultants or 4) simply providing outsourcing information to anyone interested in HR matters. And, we are equipped to prepare any documents required. Examples include: termination notices; warnings; counseling reports; progressive discipline procedures; write-ups; employment/confidentiality/noncompete agreements; employee handbooks; responses to employee demands; responses to wage and hour, overtime, rest/meal breaks, retaliation and hostile work environment disputes; memos to management; complaint investigations and reports; separation and severance agreements; settlement and release agreements; responses to sexual harassment claims; responses to discrimination claims; arbitration procedures (preparing a binding arbitration agreement, responses and other paper work, scripts and declarations for testimony, representatives to appear at hearings) and help with language used in your emails and communications with employees. Services can be on a retainer basis, hourly or flat fee. Our HR consultants have 20+ years’ experience in HR consulting. Or, simply give us a call for a free initial consultation. (800) 995-9434 (Ext. 1). Or email our parent company (attention Cliff): Info.NationalLienLaw@gmail.com.

No-Hire Agreements: HR Consulting Legal Summaries

by hrconsulting14

Assume your company is hired by Company B that needs technical computer services. It’s a long-term arrangement so you dispatch a crew of employees to work full-time and work at the premises of Company B. You have agreements with your employees that they will not work for any of your customers. After a few months, one of your employees is hired away by Company B. Can you prevent this?

Assume you are a pest control company and have spent years training an employee. All of a sudden the employee decides to jump ship and work with a competitor. Can you prevent this?

Case Law:

The courts have not wavered from the strong public policy of the right of every employee to earn a livelihood under Business and Professions Code Section 16600. See Metro Traffic Control, Inc. v. Shadow Traffic Network (1994) 22 Cal.App.4th 853, 859 (“every citizen shall retain the right to pursue any lawful employment and enterprise of their choice”); Morlife, Inc. v. Perry (1997) 56 Cal.App.4th 1514, 1520 (“the important legal right of persons to engage in businesses and occupations of their choosing”).

The California Supreme Court has gone so far as to state that even “a mere limitation on an employee’s ability to practice his or her vocation … [that was] reasonably based” would fall afoul of section 16600. Edwards v. Arthur Andersen LLP, 44 Cal.4th 937, 81 Cal.Rptr.3d 282 (2008)

Key Points:

  • Courts overwhelmingly favor the right of a person to find the employment of their choosing.
  • Courts almost have a built-in bias against no-hire and similar provisions.

VL Systems, Inc. v. Unisen, Inc. (2007) 152 Cal.App.4th 70. Company hired consultant for computer services. One of consultant’s employees was hired away by Company, which caused a lawsuit for violation of the no-hire agreement. That agreement had a liquidated damages provision. The employee of the consultant had never worked on any jobs for the Company and was just a random employee. The employee was hired away after answering an Internet ad. The court invalidated the no-hire provision and allowed the employee to be employed.

Key Points:

  • There is a better chance of stopping the employee if that person was actually working for the contracting party.
  • There is a better chance of the employee winning if he or she did the solicitation as opposed to the contracting party (because the contracting party would not be directly violating the provision it signed).
  • It is easier for the employee to win if he or she did not know about the no-hire provision.
  • It is not okay to “raid” the employment pool by taking away numerous employees

Golden v. Cal. Emergency Physicians Med. Grp., 782 F.3d 1083 (9th Cir., 2015). A doctor worked with a medical staffing company that specialized in staffing emergency rooms with physicians. The agreement signed by the doctor prohibited him from working for any of the hospitals that had been under contract. At the appellate level, the Court of Appeal held in favor of the employee and sent the case back to the District Court for redetermination.

Key Points:

  • Although there are many cases regarding non-solicit or non-compete, as to no- hire agreements, there is no definitive statement thus far from the California Supreme Court.
  • Regardless, the weight of authority and the trend modernly is to invalidate these provisions and allow the employee to work.
  • Other states allow the prohibitions if they are reasonable in nature. California cases say that any restraint is unlawful.

Conclusion:

There is a strong public policy in California and other states that your company cannot prohibit one from working somewhere else and pursuing their livelihood. Unfortunately, your chances are slim of enforcing such provisions.

www.HRconsulting.network can act as your virtual HR Independent Consultant. Our consulting services include: 1) acting as your virtual Human Resources department, 2) assisting your existing HR department personnel, 3) giving advice to other HR consultants or 4) simply providing outsourcing information to anyone interested in HR matters. And, we are equipped to prepare any documents required. Examples include: termination notices; warnings; counseling reports; progressive discipline procedures; write-ups; employment/confidentiality/noncompete agreements; employee handbooks; responses to employee demands; responses to wage and hour, overtime, rest/meal breaks, retaliation and hostile work environment disputes; memos to management; complaint investigations and reports; separation and severance agreements; settlement and release agreements; responses to sexual harassment claims; responses to discrimination claims; arbitration procedures (preparing a binding arbitration agreement, responses and other paper work, scripts and declarations for testimony, representatives to appear at hearings) and help with language used in your emails and communications with employees. Services can be on a retainer basis, hourly or flat fee. Our HR consultants have 20+ years’ experience in HR consulting. Or, simply give us a call for a free initial consultation. (800) 995-9434 (Ext. 1). Or email our parent company (attention Cliff): Info.NationalLienLaw@gmail.com.