California Employee Rights Advocate : California Labor Attorney & Lawyer : Southern CA Employment Law : Los Angeles, Orange County : United Employees Law Group

A non-compete agreement is a contract between the employer and an employee whereby the employee agrees not to compete with his ex-employer when he leaves the employ of that company. In other words, the employee may not contact customers of his old employer and solicit their business. The purpose is to protect the employer from the employee using confidential knowledge acquired during his employment which the employee wants to use to compete against the old employer.

In most cases non-compete agreement are not enforceable in California. Business and Professions Code § 16600 provides 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." Section 16600
invalidates agreements to preclude employment in a certain line of work. The section has also been construed by California courts as invalidating agreements that seek to prevent former employees from accepting work from any of the former employer's clients. (Morris v. Harris (1954) 127 Cal.App.2d 476.) A former employee may also solicit employees from his or her former employer if unlawful means or acts of unfair competition are not used. (Diodes, Inc. v. Franzen (1968) 260 Cal.App.2d 244.)

Even though non-compete agreements are generally not legal many companies require their employees to sign non-compete agreements to deter an employee from competing or using his/her knowledge after leaving. If you have been asked to sign a non-compete it most likely is non-enforceable or at least much more limited than it appears.

There are a few exceptions where non-compete agreement may be enforceable.

• Business ownership exception: It applies when a shareholder "sells" their stock to another for valuable consideration. (Hilb, Royal & Hamilton Ins. Services v. Robb (1995) 33 Cal.App.4th 1812, 1824-1825.)

• Partnership Exception: Business & Professions Code § 16602. However, not every agreement restricting competition between partners is valid. A "rule of reason" applies. (Howard v. Babcock (1993) 6 Cal.4th 409.) For example, a partnership agreement may validly restrict competition by precluding withdrawing partners from practicing in a limited geographic area. (Id.) Unlike business sales and section 16601, there is no requirement pursuant to section 16602 that compensation for goodwill in the partnership be transferred. South Bay Radiology Medical Associates v. Asher (1990) 220 Cal.App.3d1074, 1083.

Labor law is complex and if you have any questions regarding your employment it is recommended that you contact a California labor law attorney who can help you understand your rights and in many cases will review your situation without charge.

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Long Beach – (562) 256-1047
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With our current economic state, companies, employees and new graduates are equally concerned with employment. College students or new graduates are facing the age old issue of having a degree without experience while companies are looking to save money on payroll and keep a knowledgeable staff. Often time companies will offer unpaid internships a seemingly mutually beneficial relationship. College students are able to add experience to their resumes while companies get free labor.

But at a closer look, this might not be a fair shake. What if the student is studying to be in marketing and the company places he/she in the accounting department to do data entry all summer?

Federal Department of Labor (DOL) has set forth a few ground rules on who should be considered and intern versus who will be an employee.

1. The training is similar to that which would be given in a vocational school.
2. The training is for the benefit of the trainee.
3. The trainee does not displace a regular employee and works under close observation.
4. The training provider derives no immediate benefit from the trainee; in fact, its operations may be impeded.
5. The trainee is not entitled to a job at the completion of the training.
6. The employer and the trainee understand that the trainee is not entitled to wages; however, a stipend may be permitted. (Employment Relationship/ Trainees, U.S. Dep't of Labor Op. Ltr. Wage and Hour Adm. WH-229.)

California Department of Industrial Relations took it a step further and added a few criteria of its own:

7. The training should be part of an educational curriculum.
8. The students should not be treated as employees for such purposes as receiving benefits.
9. The training should be general in nature, so as to qualify the students for work for any employer, rather than designed specifically as preparation for work at the employer offering the program.
10. The screening process for the program should not be the same as for employment.
11. Advertisements for the program should be couched in terms of education rather than employment. (See generally Cal. Div. of Labor Standards Enforcement, Opn. Ltrs. 1998.11.12 and 1996.121.30, available at www.dir.ca.gov/dlse/ DLSE_OpinionLetters.htm.)

It’s important to be able to distinguish who will be considered an intern and who should be considered an employee not only for payment purposes but also for workers compensation insurance and for benefits entitled to employees such as medical insurance and paid time off.
Labor law is complex if you have any questions regarding your employment it is recommended that you contact a California labor law attorney who can help you understand your rights and in many cases will review your situation without charge.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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Starting January 1st all employers must comply with the California new wage theft protection act, Labor Code Section 2810.5. . Theft protection act sets out to clearly define how, when, and what employees shall be paid. The idea is alleviate any confusion or misunderstandings about the type of employment and benefits the employee will receive. Effective immediately all California employers regardless of company size and industry are required to give the following information to all of their employees regardless of full time part time or seasonal status.

1. Classification: exempt, non-exempt, commission, piece rate. In other words, how the employee will be paid, hourly, salary, commission only, days wage, piece rate. It’s important to note that if the employer is claiming that employee is exempt from overtime they must also cite the exemption that they feel the employee falls under.
2. How much the employee will earn: by the hour, overtime rates, annual salary, piece rate day rate.
3. When the employee will be paid: weekly, biweekly, bimonthly, monthly etc.
4. If applicable, allowances claimed as part of the wage, meals, housing etc.
5. Name of the employer or the DBA (doing business as) or any other names the employer uses to conduct business.
6. Mailing and Physical address of the employer main place of business.
7. Phone number to the main office
8. Workers compensation information: Name of insurance carrier, phone number, address

Moving forward Employers must give written notice to all newly hired employees as well. Also if any of the information above changes the employer has 7 days to furnish notice of change in writing to the employee, California Labor Code §226. Notice need not be provided to non-exempt employees who are both covered by a collective bargaining agreement and who earn at least 30% more than the California minimum wage per hour.

The Labor Commissioner will be publishing a notice template later this month for employers to use.

With new laws come new penalties, the Wage Theft Protection Act adds or increases existing civil and criminal penalties, in some instances allowing liquidated damages and attorneys' fees, and extends the applicable statute of limitation to three years.

Labor law is complex if you have any questions regarding your employment it is recommended that you contact a California labor law attorney who can help you understand your rights and in many cases will review your situation without charge.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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Labor Code Section 515.5 dictates that certain software employees are exempt from overtime pay and Labor Code Section 510 sets forth the minimum that these exempt software employees shall be paid.

It’s Important to first identify who is considered exempt from over time. According to the California Department of Industrial Relations all of the following criteria must be met:

1. The employee is primarily engaged in work that is intellectual or creative and requires the exercise of discretion and independent judgment.
2. The employee is primarily engaged in duties that consist of one or more of the following:

o The application of systems analysis techniques and procedures, including consulting with users, to determine hardware, software, or system functional specifications.
o The design, development, documentation, analysis, creation, testing, or modification of computer systems or programs, including prototypes, based on and related to, user or system design specifications.
o The documentation, testing, creation, or modification of computer programs related to the design of software or hardware for computer operating systems.

Next, we can look at the rough road exempt software employees have had over the last decade. In 2000 the minimum salary for an exempt employee was equal to no less than $41.00 an hour. By 2007 it had climbed to equal not less than $49.77 an hour. Unfortunately in 2008 during our economic meltdown, this amount was reduced drastically to $36.00 an hour. There have been gradual annual increases. In fact, effective January 1, 2012 the increases will be no less than $38.89 an hour, or no less than $81,026.25 annually, or no less than$6752.19 monthly.

It’s important to note that although the minimum per hour has been effective since 2000, it was until the drastic decrease in 2008 that California labor laws also made sure that there would be a monthly and an annual minimum requirement. Thus ensuring that the while the employee may not be getting time and a half for all overtime hours worked they would be certain that their pay check would remain at or above the monthly and annual requirements while still meeting the minimum pay per hour.

California labor laws can be confusing and multifaceted if you are a software employee exempt or non exempt it is recommended you contact a California labor law attorney to be certain you are and have been paid properly over the last four years.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
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San Francisco – (415) 200-0012 or (415) 230-2755
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Does sexual harassment really still exist? Who would dare? It’s unfortunate that it does still occur in the work place but luckily California labor laws aim to offer protection. There are basically two different ways one can be sexually harassed: quid pro quo or to the point of hostile work environment.

Quid pro quo sexual harassment
“This for that” is the direct translation of quid pro quo. This type of sexual harassment is when the harasser offers something in return for the harassed to accept these unwanted advances. For example, if your supervisor or manager offers a promotion or a raise or rather threatens with a write up or termination in exchange for the harassed to bare or accept the harassment.
Under California labor law, the employer is absolutely liable for the sexual advances of a supervisor and has no legal defenses available to it. A victorious plaintiff can recuperate lost wages and compensation of other economic losses, emotional distress damages, interest and attorney fees, and in cases where the employer’s officers, directors or managing agents knew of the harassment, punitive damages intended to punish or deter the employer.

Sexual Harassment to the Point of Hostile Work Environment

Subordinates, co-workers, supervisors, and even managers can all participate in sexual harassment to the point of creating a hostile work environment. Often times this harassment can come in the form of slurs, intimidation, taunting, groping, grabbing and ridicule.
It’s important to note that a single severe act of sexual harassment can create a hostile work environment as well as many subtle acts, by one person or many. Also the person being harassed does not have to be the one that files a claim. Someone else that has witnessed and had to deal with watching another person being harassed is also a victim of hostile work environment.
Recently, the California Supreme Court held that employer actions, such as termination, demotion, etc., could also constitute hostile work environment harassing conduct. See Roby v. McKesson HBOC (2009) 146 Cal.App.4th 63.

Who is liable?

If the Harasser is a supervisor or manager then the company is certainly held liable for their actions. If the harasser is a coworker or subordinate then company will be held liable if you are able to show that a supervisors or manager was aware of this persons inappropriate behavior.
Under Title VII of the Civil Rights Act of 1964

When a supervisor engages in hostile work environment harassment that does not involve tangible employer actions (e.g., termination, demotion), the employer can escape liability for HWE if the employer can show

1) employer exercised reasonable care to prevent and correct promptly any sexually harassing behavior and
2) the employee unreasonably failed to take advantage of the preventive or corrective opportunities provided by the employer, or to avoid harm otherwise.

See Burlington Industries, Inc. v. Ellerth (1998) 524 US 742, 764–765;Faragher v. City of Boca Raton (1998) 524 US 775, 806. This is unfortunate in that many victims of sexual harassment do not immediately report it to their employers for fear of retaliation. Under federal law, these employees may be out of luck. This is one of the reasons why filing a sexual harassment claim under California rather than Federal law is usually the better course.

Labor law is complex if you have any questions regarding your employment it is recommended that you contact a California labor law attorney who can help you understand your rights and in many cases will review your situation without charge.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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While the law can’t prevent employers from retaliating against their employees, it can offer restitution should you fall victim to retaliation. Retaliation can come in many forms and can be a result of several different types of issues reported.

Often times the employee will report issues such as sexual harassment, unsafe working conditions, workers compensation claims, another employee breaking company policy or even broken laws, also known as Whistleblower. Most commonly discrimination is reported; such as: age, race, gender, sexual orientation, religion, and disability.

As unfortunate as retaliation is, it can be in administered in many different ways. Employers have been known to cut hours or pay, pass employees over for promotions, place people on unpaid administrative leave and even terminate employment. Termination in retaliation for reporting any of the previously mentioned issues would likely be considered a wrongful termination.

It’s also interesting to note that even though there might only one person, perhaps your manager, giving you a hard time or retaliating against you, under the law the company is still liable for that person’s actions. In 1998, the California Supreme Court ruled that individual managers and supervisors can’t be held personally liable for retaliation. However, the California Fair Employment and Housing Act says that it is unlawful for "any employer, labor organization, employment agency or person'' to engage in retaliation.

If you have recently reported some type of illegal or improper activity within the company and your working environment or conditions have been adversely effected you should seek counsel of an experienced California labor law attorney. An experienced attorney can help you understand the legal aspects of your situation as well as offer guidance in seeking recompense.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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Does your employer offer a 401k, profit sharing, or a money market account? Were you given specific details about this plan prior to signing up; such as past performance, fees and expenses? Do you get monthly or quarterly statements on your investment?

Until recently none of this was required by law. The US Dept of Labor (DOL) has better defined what is required to be shared with participants and beneficiaries prior to investing and throughout the term of the investment. In general all of these new requirements will go into effect as early as May 31, 2012.

Under the Employee Retirement Income Security Act (ERISA) the following information must be shared with potential employee investors and existing employee investors as well as their beneficiaries.

1.     Initial & Annual Notice
Before the investor begins making contributions and every year after the investor should be notified of the following information.

a. Investment-Related Information
Investment related information can be complex and very detailed so the employer is required to provide the following: performance data, benchmark information, fee and expense information, Internet website address to obtain more specific or current information, and a glossary of terms. As well as a side by side comparison of each of the plans that are offered.

b. Plan-Related Information.

i. General Plan Information
Information regarding the operation of the investment including when and how to invest, if there are any limitation to the times amounts that can be invested, a description of “brokerage windows”, reference to any applicable voting rights and identification of investment managers.
ii. Administrative Expenses Information.
Administrative expenses are expenses that are typically related to cost of managing the fund such as monthly, quarterly or annual record keeping. If multiple accounts exist this information must be provided for each individual account and be specific that account.
iii. Individual Expenses Information
These are expenses that may be charged against a participant's or beneficiary's individual account for services provided on an individual basis (e.g., fees to process loans or qualified domestic relations orders (QDROs), or sales charges).

2.     Updating Notice
Any changes to the plan information previously disclosed must but updated and disclosed within at least 30 days but not more than 90 days prior to the effective date of the change. It’s important to note that updating notices do not apply to investment related information
3.     Quarterly Notice
Quarterly notices occur every 3 months and usually align with the fiscal year. Investor and beneficiaries must receive notice of the dollar amount of the plan related fees and expenses, both administrative and individual and description of services for all fees and expenses. It’s important to note that if notices of the account were made and outside of the regularly scheduled notices then those notices do not need to be reiterated at the regularly scheduled time.
4.     Disclosures Subsequent to Investment.
Not only do potential employee investors and beneficiaries need to be informed of the above mentioned investment-related information and the plan-related information prior to investing but they also need to be informed of the final regulations. Final regulations should provide information such as: voting rights, management rights and how these rights will and can be passed or shared with the beneficiaries.
5.     Information Provided Upon Request
Investors and beneficiaries can are any time request copies of any plan or investment related information including: financial statements, prospectus, reports, non-registered investment alternatives, share value information, dividend disbursement, list of assets comprising the portfolio.

Labor law is complex if you have any questions regarding your employment it is recommended that you contact a California labor law attorney who can help you understand your rights and in many cases will review your situation without charge.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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With the end of the year quickly approaching some people will be working on holidays others will be taking time off from work and we will all be hopeful for a little extra cash. California labor laws are pretty clear about how employers must treat these situations and what employees should expect.

Holiday Pay

California labor law does not require employers to pay employees extra for working on holidays. However, there are quite a few companies out there that offer their employees 1.5 times their regular rate or even double time. If this is a company policy then the employer must adhere to it. The best way to make sure you know what the company policies are regarding holiday pay would be to review your employee handbook or contact your human resource department. If these policies are not in writing it would be a good idea to request a written copy.

Vacation Pay

Vacation pay, sometimes referred to as paid time off (PTO). California labor laws do not require employers to offer PTO or vacation pay but if it is offered by the employer then the employee is either entitled to use it or be paid for its monetary value. It is important to note that the employer cannot take it away. “Use it or lose it” policies are not legal in the state of California. With that being said, the employee must understand that the employer does not have to give you the time off that you request. If your request for time off is denied you could lose your job if you leave anyway. You may decide to ask for your vacation pay on your next pay check instead of actually taking the paid time off.

Bonuses

Again, bonuses not required by California labor law but still common practice by most employers. Other common practices during the holidays are gift giving either in the form of actual tangible gifts or in the form of gift cards. In either instance you will notice that the monetary value of these gifts or bonuses will be taxed on your pay check. This often confusing to read on your paystub, but more than likely you will see the value on the gift added to your wages, then taxes will be taken out of your pay, then you will see the original amount of the gift deducted. This practice is required by law nationwide, all gifts and bonuses must be counted as wages according to the IRS.

Labor law is complex if you have any questions regarding your employment it is recommended that you contact a California labor law attorney who can help you understand your rights and in many cases will review your situation without charge.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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People call in everyday with various employment issues or concerns but what is interesting to me is that the majority of the time they have one of these 5 issues and they didn’t even know it. I have had clients tell me that they just assumed that they were being paid and treated properly because the company that they work for is so big and well known:”they must know what they are doing, right?!” The truth is that labor violations occur in any size business and that it’s the employee who needs to arm themselves with knowledge of their rights or at least contact a California labor law attorney with any questions or concerns.

1. Misclassified as an Exempt Employee (salary)
….when in fact they should be Non-Exempt (hourly). Companies are not allowed to arbitrarily classify their employees as exempt from overtime. California labor laws have set strict guidelines regarding who will be considered exempt. The most important thing to remember is that your exemption status is based on your actual job duties, not on your job title or on the job descriptions given to you by the company.

2. Working Off the Clock
Non-Exempt employees are often pressured to work while they are not clocked in. This could mean coming in early to work to prepare for the day or clocking out and remaining to finish work at the end of the day. Often times employers will not come right out and tell their employees that they must work off the clock, but the employer might pressure the employees by threatening with write-ups or termination if all of the work is not completed before the end of the day and in the same breath make it known that overtime is not allowed. Other times it’s more systematic, for example: an employee must spend 10 minutes in the morning booting up the computer system and logon to their computer before they are granted access to use the time keeping system. Or route drivers often have to load their trucks but their time clock doesn’t start until their first stop.

3. Misclassifying Employees as Independent Contractors
Often time employers will classify employees as independent contractors in order to avoid paying overtime, additional taxes and insurance. Again California Labor law has set guidelines regarding who can be classified as an Independent contractor. In order to be an independent contractor you should be responsible for the following:
• Make your own schedule
• Use your own equipment, vehicle, tools etc
• Not have to wear a uniform for the other company
• Not have a supervisor or manager directing you on a regular basis

4. Not Providing Suitable Seating for Employees
Private Attorneys General Act ("PAGA") states "nature of the work reasonably permits the use of seats." Recently large companies like Home Depot, Whole Foods, Costco and Nordstrom have all been in the courts for this violation. Typically for not providing seating to cashiers or other positions where the employee is somewhat stationary.

5. Failing to pay Reporting Pay
Reporting pay is owed when an employer has an employee come to work but the decides that person is not needed for the day and sends them home or works less than half of the shift they were scheduled to work. At this point an employer is required by California labor law to pay this employee for half of the usual or scheduled day's work. This amount should be no less than two hours or more than four hours at the employee's regular rate. The exception is that employee was unable to work due to acts of God, threats to employee or property, etc.

Labor law is complex if you have any questions regarding your employment it is recommended that you contact a California labor law attorney who can help you understand your rights and in many cases will review your situation without charge.

If you have any questions about this article or our blog, feel free to call us at:

Long Beach – (562) 256-1047
Los Angeles – (213) 261-0229
San Francisco – (415) 200-0012 or (415) 230-2755
San Diego – (619) 342-1242 or (619) 272-2193

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