Laborsphere

Part 14 of “The Restricting Covenant” Series: Non-Competes and the Janitor Analogy

Let me begin by explaining that this article does not focus on the janitorial profession and whether non-competes in that profession are enforceable. That’s a topic for another day. Instead, this fourteenth article in The Restricting Covenant series discusses a concept that some courts and litigants refer to as the “janitor analogy” or the “janitor test,” when analyzing or illustrating the overbroad scope of a non-compete provision.

In Any Capacity?

The janitor analogy is most often invoked in cases where the employer’s non-compete agreement prohibits a former employee from being employed or affiliated with a competitor “in any capacity” or “in any manner.”

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New York City Employers: Get Ready to Comply with the Earned Safe and Sick Time Act

As a reminder, the New York City Earned Safe and Sick Time Act (“Paid Safe/Sick Leave Law”) became effective on May 5, 2018. The Paid Safe/Sick Leave Law applies to all employers with five or more employees who work more than 80 hours a year in New York City and requires employers to provide up to 40 hours (5 days) of paid safe and sick leave. Employers with less than five employees must provide unpaid sick and safe leave. In order to notify employees about their rights under the Paid Safe/Sick Leave Law, New York City employers must distribute written notice to their employees on the first day of employment or by June 4, 2018. Employers can find the new Notice of Employee Rights on the New York City Department of Consumer Affairs (“DCA”) website, available here. The DCA also provides the new notice in Spanish, Chinese and 24 other languages.

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Are You Correctly Calculating Overtime?

Recently, the California Supreme Court issued its decision in Alvarado v. Dart Container Corporation of California. The Court’s decision changes the manner in which an employer must calculate overtime for employees who earn a flat sum bonus during a single pay period. Accordingly, based on the Court’s decision, this is yet another area where the rules in California differ from the federal rules. This decision is significant because it applies retroactively subject to the applicable statute of limitations.

By way of background, both state and federal laws require that amounts awarded as bonuses be included in determining a non-exempt employee’s overtime rate, except in the case of discretionary bonuses. This means that when the employee works overtime hours and receives a non-discretionary bonus, this bonus program will increase the non-exempt employee’s hourly rate for calculating overtime.

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Justice Gorsuch Casts Deciding Vote Rejecting NLRB’s Prohibition on Class Action Waivers

In a long-awaited decision, the United States Supreme Court, by a 5-to-4 vote, overturned the National Labor Relations Board’s (the “Board”) ruling that class action waivers violate the National Labor Relations Act (NLRA) because they interfere with the right to engage in “protected activity,” which, according to the Board, includes the ability to bring class or collective actions. Epic Sys. Corp. v. Lewis, No. 16-0285, 2018 WL 2292444, at *23 (U.S. May 21, 2018).

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Philadelphia Salary History Ban: Judge Rules that Employers Can Ask About – But Not Use – Prior Salary History

On April 30, 2018, a federal district court issued a long-anticipated ruling on Philadelphia’s salary history ban. The ban, scheduled to take effect May 23, 2017, has two parts: (1) the “Inquiry Provision,” precluding employers from inquiring about a prospective hire’s wage history; and (2) the “Reliance Provision,” prohibiting employers from relying on the wage history of a new employee in determining the employee’s pay, unless the employee “knowingly and willingly disclosed his or her wage history to the employer.”

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Relearning the ABCs: California Supreme Court Adopts New Independent Contractor Test

Last week, in Dynamex Operations West, Inc. v. Superior Court, 2018 WL 1999120 (Apr. 30, 2018) (Dynamex), the California Supreme Court upended the prevailing understanding of the independent contractor-employee distinction under California law. In a ruling that is certain to have wide-ranging repercussions for companies that rely on independent contractors, the Court declined to apply the multi-factor common law test derived from its 1989 decision in S.G. Borello & Sons, Inc. v. Dep’t of Indus. Rel’ns, 48 Cal. 3d 341 (1989) (Borello) to the question of whether a worker is an “employee” subject to the minimum wage and overtime protections of the California Industrial Welfare Commission’s (“IWC”) wage orders. Instead, the Court adopted a simple, three-part test that likely will expand the wage orders’ reach.

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