A new decision from the U.S. Court of Appeals for the Ninth Circuit continues to leave employers uncertain as to the enforceability of class action waivers in arbitration agreements. The Seventh and Ninth Circuits are on one side of the issue, and the Second, Fifth, Eighth, and Eleventh Circuits on the other. The Seventh and
In appropriate circumstances, a severance agreement containing release-of-claims provisions may be the most desirable way to end an employment relationship with an employee. Such agreements can facilitate a smooth transition while greatly reducing the employer’s exposure to costly lawsuits alleging wrongful termination, discrimination, retaliation, or other theories of recovery. However, there can be downsides to such agreements too.
Last year, California revised Labor Code section 2751 such that any employment agreement involving “commission” payments would have to be put into writing with a signed copy of the agreement be given to the employee. Those revisions go into effect on January 1, 2013.
Continue Reading First “Commission” Agreements Must Be in Writing. Now the Definition of “Commissions” is Limited Under Labor Code § 2751
By: James Kachmar
Readers of this blog will note that we frequently remind them that California law generally prohibits non-compete agreements. There are very limited exceptions to this general rule, one being that the seller of goodwill in a business can be bound by a valid non-compete agreement to protect the goodwill that is being purchased. Sometimes, the buyer of a company will want to continue to employ certain key employees, who can also be the sellers of the goodwill of the former company. We have seen instances where the purchasing company gets creative and subjects the seller/key employee to two covenants not to compete, one in the purchase agreement and the other in an employment agreement. Last week, a California appellate court shut the door on this approach in the case Fillpoint, LLC v. Maas.
An employer’s ability to have disputes with employees resolved by arbitrators instead of courts had some ups and downs in recent days. One of those developments suggests that employers should review and perhaps revise their arbitration agreements to keep them enforceable in state court. The other development indicates that arbitration agreements will continue to be treated favorably by federal courts.