California courts mostly take a no prisoners approach to Business and Professions Code section 16600, the statute prohibiting illegal restraints on trade. Courts broadly interpret Section 16600, which states that “every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void,” to invalidate most post-employment non-competes and customer non-solicits, including covenants preventing former employees or their new employers from “hiring” employees of a former employer (so-called “no hire agreements”). But Section 16600 does not bar all post-employment covenants–just those that “restrain” trade.
2018 has been a year of box office hits for California employers, but the critics remain skeptical.
On December 13th, join Baker McKenzie at the Westin SFO in Millbrae from 9 AM to 12 PM for our annual employment law update as we review the employment winners in 2018 and share our predictions for the year ahead.
With our director and producers keeping us on track, our cast and crew will cover topics including:
- National and CA wage and hour updates and trends
- California’s hot-off-the-press #metoo legislation
- New CA requirements for female board members
- Clarifying California’s salary history ban
- Living and litigating in the gig economy for multi-state employers
- Immigration changes affecting California employers
- And much more!
We will also go “on location” and share a few international trends.
Join Us and Win!
The concession stands are open! Join us for a chance to win movie night themed prizes and more. Click here to view the full invite for more details on time, location and our cast and crew, and click here to RSVP.
In a welcome decision for franchisors, and first of its kind in the Second Circuit, the Southern District of New York ruled that Domino’s Pizza Franchising LLC, the franchisor (Domino’s), did not exert enough control over its franchisee to warrant joint employer status. This determination means Domino’s will not have to face claims brought under the Fair Labor Standards Act (FLSA) and the New York Labor Law (NYLL) by current and former employees of a Domino’s franchisee.
Click here to read more about the case, the decision and takeaways for employers.
As employment lawyers based in California are well aware that post-employment non-compete agreements are generally void as a matter of law in this state. Further, there is precedent for awarding punitive damages and disgorgement of profits where employers have knowingly required employees to enter into invalid agreements. Also, the DOL has actively pursued California-based companies engaging in anti-competitive practices when it comes to talent.
Against that backdrop, however, employers need not “throw in the towel” completely when it comes to post-termination restrictive covenants as there are a few narrow scenarios that allow for enforceable post-termination non-competes in California in the right circumstances, and a potential new take on an old strategy to consider.
The Seventh Circuit recently clarified that courts should determine whether an arbitration agreement provides for or permits class-action claims. The decision in Herrington v. Waterstone Mortgage Corp. is instructive on many levels, not the least of which is its clarity.
Illinois employers will have a new headache this new year, because as of January 1, 2019, they must reimburse employees for all “necessary expenditures and losses” incurred within the scope of their employment. This August, the Illinois Wage Payment and Collection Act changed to specifically include an expense and loss reimbursement requirement.
Government contractors are familiar with the obligation to retain minority or women-owned businesses as subcontractors to obtain government work. Increasingly, apex private sector businesses require participation by minority or women-owned businesses as a condition of obtaining work, as well.
A recent decision by the federal court for the Southern District of New York is a cautionary tale, and highlights the care required when terminating a minority business enterprise (MBE) sub-contractor. Annuity Funds Operating Engineers Local 15 v. Tightseal, No. 17-CV-3670 (S.D.N.Y. August 14, 2018).
Alyssa Milano tweeted #MeToo just about one year ago. Since then, we’ve seen unprecedented attention on sexual harassment in the workplace and a number of high profile individuals have been taken to task.
For employers, the spotlight, viral encouragement to come forward and public scrutiny is translating to an outpouring of claims and lawsuits. Indeed, in September 2018, the EEOC reported a surge in sexual harassment filings–more than a 50 percent increase in suits challenging sexual harassment over FY 2017.
Thanks to our Canadian colleagues for this alert:
Ontario’s revised regulatory framework for cannabis is now in effect. Bill 36, the Cannabis Statute Law Amendment Act, 2018, received Royal Assent and came into force on October 17, 2018, amending 18 provincial statutes including the Cannabis Act, 2017 (now the Cannabis Control Act, 2017 ) and the Smoke-Free Ontario Act, 2017 (SFOA 2017).
Today, an estimated 40 million people are living in modern day slavery—including an estimated 16 million individuals in forced labor across global supply chains.
Given the importance of this issue, we are proud to introduce a new publication, Eradicating Slavery: A Guide for CEOs. Prepared by the B Team in partnership with Baker McKenzie, this guide provides practical guidance and examples of successful collaboration among companies to help end modern slavery.
While there’s been increasing concern and interest from business around tackling modern slavery, to date corporate leaders have been unsuccessful in meaningfully moving the needle to end this horrific practice. The B Team’s Guide seeks to help the private sector understand its responsibility and power in making a real impact on this issue and bringing freedom to those who need it most.
Click here to access the guide.