On Friday, June 26, 2020, Philadelphia Mayor Jim Kenney signed the Essential Workers Protection Act, providing protections to workers who speak out about unsafe workplace conditions during the COVID-19 pandemic. The ordinance, which is touted as the first of its kind in the United States, was supported by more than two dozen labor, advocacy and nonprofit organizations in Philadelphia.
In Pennsylvania, it has long been known that waiting until after the start of employment to have an employee sign a non-competition agreement comes with the real risk that the agreement will be unenforceable for lack of consideration. Last week, the Pennsylvania Supreme Court provided definitive guidance on the issue in Rullex Co., LLC v. Tel-Stream, Inc., et al., holding that a non-competition agreement entered into after an employee commences employment fails for lack of consideration unless the essential provisions of those restrictions were agreed to before the employee started work.
On April 22, Governor Tom Wolf outlined a three-phase plan for reopening Pennsylvania businesses, following a color-coded system: Red, Yellow and Green. As the COVID-19 threat continues to slow, each county has been moving gradually through the phases. According to the Commonwealth, the phases are designed to decrease the continued spread of COVID-19 while relaxing restrictions and promoting the resumption of business activity.
Following is a brief description of each phase:
A recent Delaware Chancery Court opinion has elucidated Delaware’s approach to judicially modifying, or “blue-penciling,” overly broad noncompete agreements and deferring to parties’ choice of law provisions. The case, FP UC Holdings, LLC, et al. v. James W. Hamilton, Jr., et al., C.A. No. 2019-1029-JRS (Del Ch. Mar. 27, 2020), highlights the importance of drafting well-tailored restrictive covenants, and shows that even in Delaware – where employers often have been reassured by the safe harbor of courts’ relative willingness to blue-pencil problematic agreements and apply Delaware law to fact patterns that have developed in other states – employers must make careful drafting and choice of law decisions. It also emphasizes that if an employer’s intent is to litigate in Delaware, the employer should do so from the beginning, without acquiescing to another court’s jurisdiction.
After an initial wave that saw a focus on closing or limiting “non-essential” or “non-life sustaining” businesses and limiting individual travel, states and municipalities have shifted their attention to protections for those who are continuing to work and travel as they perform essential personal and professional functions. The primary, but not only, area of such focus is on mandating the use of cloth or fabric masks. This change has come as more has become known about how the highly infectious coronavirus spreads, with the Centers for Disease Control and Prevention (CDC) now recommending that cloth face coverings be worn “in public settings where other social distancing measures are difficult to maintain,” such as grocery stores and pharmacies, “especially in areas of significant community-based transmission.”
These new orders vary in their scope and strictness. The Pennsylvania Department of Health, for example, has issued an order requiring masks to be worn by employees of businesses authorized to maintain in-person operations and further requiring employers to provide such masks. The Pennsylvania order also requires most shoppers to wear masks before entering most stores.
On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (CARES Act) was signed into law, providing an estimated $2 trillion stimulus package to address the COVID-19 pandemic. Although the CARES Act has a number of employment-related provisions (as discussed here), a central piece of the legislation expands existing unemployment insurance programs, making far more individuals eligible and providing greater benefits than existing programs. As employers consider workplace actions during this time of uncertainty, understanding the impact of the new unemployment insurance landscape and the options available will inform employers as they make critical decisions suited to their circumstances and workforce.