New Maryland Law Prohibits Non-Compete Agreements for Lower Wage Workers

Daniel L. Morgan

If you’re an employer in Maryland, beginning October 1, 2019, you are prohibited from requiring a low wage worker (defined as someone earning less than $15/hour or less than $31,200/year) to sign a non-compete agreement with your company. Maryland’s law follows a national trend in which a number of other states have either passed or are considering similar legislation. Among those states that have already passed legislation preventing employers from enforcing non-compete agreements with lower paid employees are Illinois, Maine, and New Hampshire.

As a cautionary note, Maryland’s new law does not grandfather existing non-compete agreements with employees whose earnings bring them within the purview of the new law, which means that those agreements will become unenforceable after the law takes effect. Continue reading “New Maryland Law Prohibits Non-Compete Agreements for Lower Wage Workers”

New York Closes in on Comprehensive Employee Wage Lien Law

Mara B. Levin, Anthony A. Mingione, and Stephen E. Tisman

New York is on the precipice of passing a law that would allow employees to easily file liens against an employer’s property in connection with pending wage disputes. The bill also would permit employee access to certain sensitive employer records and expand the scope of personal liability for owners in disputes over wages. Employers should monitor these developments and work with counsel to prepare an action plan should this bill become law.

The New York State Legislature has recently passed a bill that could substantially alter the legal landscape of wage disputes if signed into law by Governor Cuomo. The proposed Employee Wage Lien bill would allow employees to obtain liens against an employer’s real property and personal property based on allegations involving nonpayment of wages. If signed into law, the bill will become effective within 30 days. Similar laws have been enacted on other states.

The law will allow employees to file a notice of a lien up to three years following the end of the employment giving rise to the wage claim. Employees will be able to place liens up to the total amount allegedly owed based on claims relating to overtime compensation, minimum wage, spread of hours pay, call-in pay, uniform maintenance, unlawful wage deductions, improper meal or tip credits or withheld gratuities, unpaid compensation due under an employment contract, or a claim that the employer violated an existing wage order. In addition, the State Attorney General and Department of Labor will be able to obtain a lien on behalf of an individual employee—or a class of employees—against an employer that is the subject of an investigation, court proceeding, or agency action.

Please click here for the full client alert. 

Protect Our Employees! End of Legislative Session Marked by Employee-Friendly Changes

Anthony A. Mingione and Gregory P. Cronin

As part of the New York State Legislature’s push to pass legislation at the end of its 2019 Session, three anti-discrimination bills have been passed and sent to the governor for consideration. If signed into law by Governor Cuomo (as expected), the bills will: (i) prohibit employers from inquiring into job applicants’ wage or salary history; (ii) expand the protections of existing equal pay laws; and (iii) ban discrimination based on hair or hairstyle. The salary history ban and equal pay law amendments will go into effect 180 days after enactment, and the hair/hairstyle law will go into effect immediately upon signature. Continue reading “Protect Our Employees! End of Legislative Session Marked by Employee-Friendly Changes”

Supreme Court to Review What It Takes for a Plan Participant to Have Actual Knowledge of a 401(K) Plan’s Investments

Daniel L. Morgan

The Issue before the Supreme Court

On June 10, 2019, the Supreme Court granted certiorari in a case from the 9th Circuit Court of Appeals involving the statute of limitations applicable to claims under the Employee Retirement Income Security Act (“ERISA”). The outcome of this case has potentially important implications for employers maintaining 401(k) and other retirement plans with employee-directed investments.

The participant’s underlying claim in the case relates to whether the fiduciaries with oversight of the investments of two of Intel Corporation’s retirement plans breached their ERISA duties on the ground that the funds in which the participant invested his plan benefits included excessive amounts of hedge funds and private equity, and as such, violated ERISA’s prudence requirement. Continue reading “Supreme Court to Review What It Takes for a Plan Participant to Have Actual Knowledge of a 401(K) Plan’s Investments”

Have Employers Taken Home the Iron Throne with Lamps Plus?

Caroline Powell Donelan and Taylor C. Morosco

On April 24, 2019, the U.S. Supreme Court issued its 5–4 opinion in Lamps Plus, Inc., et al. v. Varela holding that class arbitration is only allowed when the parties’ agreement explicitly allows for it. In other words, when an arbitration agreement is silent or even ambiguous as to whether class-wide proceedings are allowed, claims must be arbitrated on an individual basis.

Lamps Plus is the latest decision from our highest court bolstering the enforceability of individual arbitration in the workplace.

In this post, we’ll take a semi-deep dive into Lamps Plus and evaluate potential implications for your workplace as well as for future litigation strategies. Continue reading “Have Employers Taken Home the Iron Throne with Lamps Plus?”

Third Circuit Indicates Support for Use of Broader Restrictive Covenants in Post-Hire Agreements Rather Than a Uniform Approach at Hiring

Kevin M. Passerini

We wrote an earlier post about the Third Circuit’s opinion in ADP, LLC v. Rafferty, et al., confirming courts’ blue penciling authority (see here); but the Third Circuit’s analysis of ADP’s two-tiered restrictive covenant structure is also worth discussing, as it may have employers doing some head scratching.

Why the focus on ADP’s two-tiered contracting approach?

ADP’s first-tier agreements for new hires included confidentiality obligations and a one-year customer non-solicit tailored to the employee’s assigned role and contacts, but no non-compete. ADP’s second-tier agreements (used in connection with stock incentives offered to high-performing employees) added a one-year territory-based non-compete and broadened the scope of the one-year non-solicit to include all customers and business partners for which ADP has provided services and all prospects for which ADP reasonably expects to provide services during the two-year period following the employee’s termination—regardless of the employee’s responsibility for them or access to confidential information about them during employment. Continue reading “Third Circuit Indicates Support for Use of Broader Restrictive Covenants in Post-Hire Agreements Rather Than a Uniform Approach at Hiring”

Attention NY Employers—Tippecanoe and Time Off Too!

Anthony A. Mingione

New York State has this week enacted sweeping election reforms that go into effect immediately. The changes will impact private employers across the state. Section 3-110 of the New York Election Law now permits all registered voters to request and obtain up to three hours of paid time off, regardless of their schedule, to vote in any public election. Employers will be permitted to designate whether the time off will be taken at the beginning or end of an employee’s shift.

To qualify, employees must be registered to vote and must provide at least two days’ advance notice to their employer of the need for time off to vote. The law is silent on whether the employer can count voting time against other paid time off programs it provides. We anticipate that regulations will be issued relating to this and other elements of the law and we will report on them as they are published.

Employers also must comply with a voting rights posting requirement. Employers are required to post a notice that explains the employees’ right to paid time off for voting. You can see a version of the approved poster on the New York State Board of Elections website here.

The notice must be posted in a conspicuous location in the workplace where it can be seen as employees come or go to their place of work, at least 10 days before a public election, and must remain up until the polls close on election day.

Employers should take note that these rules apply to all public elections; the next such statewide election will be the New York primaries on June 25, 2019.