E. Jason Tremblay

Arnstein & Lehr Partner E. Jason Tremblay authored the article, “5 ways to protect your company when a key employee departs,” which appeared in the January 23 edition of Inside Counsel. In the article, he stresses the importance for all companies to know what steps to take when an employee decides to leave, especially in circumstances where he or she leaves to work for a competitor.

Mr. Tremblay’s article appearing in Inside Counsel:

5 ways to protect your company when a key employee departs
In this competitive business world, it’s crucial to properly handle an employee’s departure, especially to a competitor

Employees frequently resign to work for competitors. This is likely to happen irrespective of whether they have signed a restrictive covenant. Therefore, in this competitive business world, it is important for all companies to know what steps to take when an employee decides to leave, especially in circumstances where he or she leaves to work for a competitor.

1. Prevent further access to company information
   Once an employee advises the company of their departure, it is critical to assume the worse and that the employee may engage in conduct that is harmful to the company. After all, there is a reason why he or she is leaving the company. The employee should be immediately relieved of any duties that would expose the employee to confidential information or the company’s customers. Passwords and email accounts should be disabled. The employee should be restricted from access to areas where confidential information is kept. The company also should request that the employee return all company-owned equipment such as laptops, cell phones or PDAs that would contain confidential business information, as well as all documents received from or generated during his or her employment.

To read the article in full, including all five steps, please click here.

Lori Adelson

Employers must be mindful of how they use criminal background information in making hiring decisions to avoid liability for failing to hire an applicant. Employers may not simply reject an applicant solely because they have an arrest record and/or “criminal” history. Rather, the employer must consider the impact of a conviction on the particular job.

Case in point – Pepsi Beverages (formerly Pepsi Bottling Co.) recently agreed to a pre-litigation settlement in the amount of $3.13 million dollars to resolve charges by the Equal Employment Opportunity Commission that it improperly considered arrest records in making hiring decisions. The EEOC claimed that as a result 300 otherwise-qualified African-American applicants were rejected because it appeared that Pepsi was flatly rejecting anyone with a criminal record instead of considering the conviction on the particular job. As part of the settlement, Pepsi is revising its employment policies, in addition to offering the 300 applicants positions with Pepsi.

The bottom line – MAKE SURE THE CRIME FITS THE JOB! Businesses should consult with their legal counsel and advisors to discuss a management training program that will best serve their needs to ensure they make appropriate employment decisions.

E. Jason Tremblay

Arnstein & Lehr Partner E. Jason Tremblay authored the article, “7 ways to protect your company when hiring from a competitor,” which appeared in the January 9 edition of Inside Counsel. In the article Mr. Tremblay recommends, when hiring a competitor’s employee, that a company should take certain steps to reduce the likelihood of being sued. He offers seven tips for the hiring process and how to behave once they start working.

Mr. Tremblay’s article appearing in Inside Counsel:

7 ways to protect your company when hiring from a competitor
Tips for the hiring process and how to behave once they start working for you

1. Investigate the employee’s employment background
   At the outset, it is advisable to determine whether there is any restrictive covenant limiting the employee’s employment rights. If so, it is prudent to discuss this fact with the prospective employee, obtain a copy of the covenant, determine whether the covenant is enforceable and evaluate whether the company should still hire the prospective employee.
2. Ensure that interviews are carefully conducted
   The company should make clear to the prospective employee that it is not interested in the competitor’s trade secrets and will honor valid restrictive covenants. An employer also should not review or accept any of the competitor’s documents that could be considered confidential and that the prospective employee may want to share with the company. Consider such documents “Exhibit A” in any lawsuit filed against the company by the competitor.

To continue reading the article, please click here.

E. Jason Tremblay

As it appeared in Inside Counsel

Orientation programs help to maximize employees’ commitment to the company.

To the extent you believe there is any relationship between an employee’s commitment to the company and the company’s performance, a new employee orientation program is an excellent first step in maximizing that correlation and getting the most from your employees.

Generally, and particularly in this competitive work environment, many employers feel that they do not have time to properly orientate new employees. And, if they do have the time, they feel as if the costs of such a program are outweighed by the possible benefits.

However, this sends a bad message to the employee from day one. An orientation program can communicate to new employees the values, beliefs, culture and history of the company, all of which can foster the desire for new employees to be committed to the company and its operations.

To read further about developing formal orientation programs for new employees,  please click here.

E. Jason Tremblay

Arnstein & Lehr Partner E. Jason Tremblay was interviewed and quoted in a December 8 online article in Human Resources Executive titled “When HR Sues.” The article discusses litigation by HR professionals and the problems companies face when HR is involved in litigation. In the article, Mr. Tremblay offers several tips for staying out of court when it comes to HR professionals or any other employee.

To view the article in full, please click here.

Thadford A. Felton

On December 1, 2011, the Illinois Supreme Court issued an opinion in Reliable Fire Equipment Company v. Arnold Arrendondo, et al. that set forth the factors that the Illinois courts should look to in evaluating the reasonableness of non-competition agreements. The Court reaffirmed that a non-competition agreement is reasonable only if the following the following four conditions are met:

• The covenant is ancillary to a valid employment relationship;
• The covenant is no greater than is required for the protection of a legitimate business interest of the employer;
• The covenant does not impose undue hardship on the employee; and
• The covenant is not injurious to the public.

In addition, the Court clarified what factors a court should consider in evaluating the “legitimate business interest” of the employer. The court stated that “whether a legitimate business interest exists is based on the totality of the facts and circumstances of the individual case. Factors to be considered in this analysis include, but are not limited to, the near-permanence of customer relationships, the employee’s acquisition of confidential information through his employment, and time and place restrictions.” The Court went on to say that no one factor should be weighted more than any of the other factors as the importance and weight to be given to certain factors will depend on the specific facts and circumstances of the individual case. As a result, “the same identical contract and restraint may be reasonable and valid under one set of circumstances, and unreasonable and invalid under another set of circumstances.”

From a business perspective, the importance of this case is that it should be easier for businesses to enforce non-competition agreements against former employees as a court must now consider a variety of factors in determining the employer’s legitimate business interest. This will give an employer more flexibility in arguing what is its legitimate business interest that needs protection.

Please click here if you would like to view the whole opinion.

E. Jason Tremblay

E. Jason Tremblay

Effective January 1, 2012, the minimum wage in the State of Florida will increase from $7.31 to $7.67 per hour. Minimum wage for tipped employees, such as waiters and waitresses, will increase from $4.29 to $4.65 per hour. This $0.36 per hour increase comes on the coattails of a previous minimum wage increase in Florida in June 1, 2011. Florida employers should therefore be prepared to again increase the hourly pay of any employees on minimum wage as of January 1, 2012. For further information, please contact your labor and employment attorney at Arnstein & Lehr LLP.

E. Jason Tremblay

In continuing a trend already underway in the United States regarding the misclassification of employees as independent contractors, California Governor recently approved legislation imposing strict penalties for California employers found willfully to have misclassified workers as independent contractors. The legislation known as the “Job Killer Act” provides for fines of between $5,000 and $25,000 (depending on the severity of the violations) on employers who misclassify workers as independent contractors, mandates certain record keeping and notice requirements, as well as provides joint and several liability for any person who “knowingly advises” an employer to misclassify a worker as an independent contractor. As a result, any company with workers located in California, especially those with workers that are classified as independent contractors, should be extremely careful as to how they classify those workers.

Should you have any questions regarding the Job Killer Act or handling your contingent workforce, please contact your employment law counsel or E. Jason Tremblay of Arnstein & Lehr LLP at (312) 876-6676 or by email at ejtremblay@arnstein.com.

E. Jason Tremblay

A recent Tennessee federal jury case involving a private university reminds the academy of the critical need to balance fairly the interests of the accused and accuser in investigating sexual assault cases. While private colleges and universities are not strictly obligated to follow the 14th Amendment due process restraints as are their public counterparts, their procedures must nonetheless be fair, balanced, and evenly applied. If not, the school can be liable, not just in contract for failing to follow its own rules (whatever they may be), but also in tort if actions taken are not reasonable and cause harm. On this basis, an institution can find itself both remediating a procedural failing and paying unlimited damages for emotional distress and similar non-contractual harms.

The recent case is John Doe v. University of the South, where a federal jury found in favor of a student who alleged that his reputation was damaged in the course of the university’s investigation of rape allegations against him. Although the amount awarded by the jury was only a fraction of the millions of dollars the student originally claimed, the court nonetheless held the school liable under a negligence (personal injury) standard. Doe arose out of an allegation by a female student that John Doe sexually assaulted her on August 30, 2008. The female student complained to the local police department which, in turn, notified the university’s administration. On September 16, 2008, the student made a formal charge of sexual assault against Doe under the university’s procedures. Two days later, on September 18, 2008, the dean of students notified Doe that he had been accused of sexual assault and that he was obligated to appear before the university’s Discipline Committee the following day. That committee met as noticed and, after just a few hours, concluded that Doe was guilty as charged. The university presented him with two options: (1) a one semester suspension with the sexual assault on his record, or (2) withdraw from the university for two semesters and no accompanying record. Either way, Doe would be forced to re-apply and be approved by the university’s Admission Committee, if he wanted to continue his studies there. Doe ultimately chose not to reapply to the university and the student who accused Doe left the school for drug and alcohol treatment and did not pursue criminal charges.

Please click here to read the article in its entirety.