Employment Law Articles | Fremont, Hayward, San Leandro, Milpitas

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Hiring Employees vs. Independent Contractors

When you are hiring new people to work for your business, it is essential to have clarification about whether you are hiring employees or independent contractors. The distinction between employees and independent contractors is important for your own business purposes, as well as for the worker. As you may know, employees have certain rights that independent contractors do not have, and accordingly, Bay Area employers have certain obligations to employees that they do not have to independent contractors.

There is a new law in California that clarifies the test an employer should use for determining whether a worker is an employee or independent contractor. You should seek advice from our Fremont area business law attorney to determine what you must do to comply with the law concerning employees and independent contractors.

California’s ABC Test

Assembly Bill 5 (AB 5) took effect on January 1, 2020. The new law replaces the common law test for determining whether a worker is an independent contractor or an employee. Under the new law, you must classify workers as employees—and not as independent contractors—unless your worker meets all the following conditions of the ABC test:

A: The person is free from the control and direction of the hiring entity in connection with the performance of the work, both under the contract for the performance of the work and in fact;
B: The person performs the work that is outside the usual course of the hiring entity’s business; and
C: The person is customarily engaged in an independently established trade, occupation, or business of the same nature as that involved in the work performed.

To be clear, your workers will be considered employees unless you can prove, based on the elements of the ABC test above, that they should be classified as independent contractors.

Business Exemptions for the ABC Test

Some businesses are exempt and do not need to take the test. In total, there are seven categories of exemptions. Determining whether your business meets the exemption requirements can be complicated. One important note is that if your business is determined exempt from this ABC test, it would then fall under the previous case law for determining whether a person is an employee or independent contractor. Our firm can help you to determine whether you fall under one of the exemptions and, either way, we may be able to provide advice on restructuring your business if it is possible.

Contact a Fremont Business Law Attorney

When you are hiring new workers for your business, you must have clarification about each worker’s classification. The new “ABC test” in California for determining a worker’s classification as an independent contractor or employee can be confusing, but an experienced business law attorney can help you. Contact the law office of Lynnette Ariathurai online or call our firm at 510-794-9290. We serve businesses throughout Fremont, Newark, Hayward, East Bay, Milpitas, Union City, San Leandro, Gilroy, San Jose, and Santa Clara, CA.

ABC test, business law attorney, California worker classification, hiring contractors, hiring employees

6 Ways to Prevent Wrongful Termination Claims

Sooner or later, every business will have to deal with an employee claiming that they were wrongfully terminated from their job. The reality is that employers usually terminate employees for performance or due to downsizing. Whenever you must make the business decision to terminate an employee, you should be aware that the employee may file a claim or attempt to sue you.

Your company’s termination process, and how it handles employees during the termination process, very often has a direct impact on whether the employee decides to file a wrongful termination claim against your company post termination. Even when you have a clear termination policy and clearly communicate it to employees as they join the company, and follow it as the employee exits the company, a lawsuit may follow.

Here are some best practices to help you avoid wrongful termination litigation

Define work performance objectives.

If you make the decision to terminate an employee, it should not be a great surprise for the employee. Document the employee counseling process – from warning, to reprimand, and to suspension. Communicate the progressive disciplinary measures with expectations for improvement to the employee and document this in his or her employee file. Thus, having a system to identify performance objectives, and comparing an employee’s individual performance against those objectives, and then communicating with the employee whether they meet or don’t meet those criteria, makes the actual termination, for performance reasons, simpler and less shocking to the employee.

Terminate with compassion.

Even if an employee expects to be terminated from employment because of performance failures, they may still be shocked when terminated and react poorly. A termination from employment is a stressful event. Wherever possible use compassion and empathy to deliver the news while remaining firm that despite everyone’s best efforts, a separation from employment may lead the employee to find a better position elsewhere.

Consider liability insurance.

Because employee lawsuits against employers for wrongful termination are common, an employer should consider liability insurance, to help pay for legal fees and any potential claim for damages. Make sure you understand the available insurance options – including what is covered, whether you are permitted to select your own attorney, and whether the claims are paid per claim or per claimant.

Comply with all state and federal employment laws, when applicable.

Most employers do not know all the state and federal employment laws applicable to their businesses. There are several Supreme Court cases and laws implemented during the year. It is best for business owners to see an Employment Law attorney annually to review their policies and procedures (see below Item 5) and to know the laws applicable to their businesses.

Make sure your company follows all the rules associated with employment promulgated by the federal Department of Labor and the State of California’s Labor and Workforce Development Agency. Posting requirements, payment of severance wages, and responding to unemployment insurance inquiries are very important.

Also, before terminating an employee, consulting with an attorney would be best practice. Your Business Attorney will review documentation, then help clients through the termination process to minimize claims.

Employment handbooks.

Writing down your employment policies and procedures as well as distributing copies of the company’s employment policies and procedures to employees is the foundation of providing a defense to a claim for wrongful termination. Employees should be provided with an employment handbook at the start of their employment and required to sign a receipt indicating that they received the handbook and accept the employment policies contained in the employment handbook.

Train your human resources team.

Your human resources personnel should be up to date with all the labor and employment laws in California or wherever else your company maintains employees. Don’t underestimate the power of developing soft skills, like using effective and efficient communications during the onboarding and termination processes.

Develop a termination plan and related employment policies

Avoiding wrongful termination suits and defending against them if they arise are just two realities of employer-employee relationships today. Assure that your company is following all applicable state and federal laws. If you own a small business and seek assistance preparing an employment handbook and related employment policies and procedures, contact Aria Law firm, a Fremont business lawyer for an initial consultation. Counseling clients in Fremont, CA near Newark, Hayward, East Bay, Milpitas, Union City, San Leandro, Gilroy, San Jose, Santa Clara, We look forward to putting our legal experience to work for you.

employee termination, employment handbooks, wrongful termination claims

New Wildfire Smoke Employment Requirements for California Businesses

On July 29, 2019 California’s Occupational Safety and Health Standards Board issued emergency regulations to protect outdoor workers from the harmful effects of wildfire smoke. The emergency regulations are in response to the wildfires that have plagued the state in the last several years. Employers are now required to monitor levels of smoke at workplaces or worksites and take protective action in response to changed conditions that put worker safety in jeopardy. The new emergency regulations are effective through January 28, 2020, with two potential 90-day extensions, until the permanent rule is effective sometime in 2020.

Affected Employers

For the most part, workplaces at which the air quality index reaches a certain level are required to comply with these emergency regulations. Employers must monitor air quality, and when it reaches or is expected to reach a dangerous level, reduce their employee’s exposure to smoke. Affected industries include agriculture and construction; occupations like delivery, maintenance, and landscaping workers; and even retail locations, like restaurants and banks, where outside doors are opened throughout the day by patrons. There are exempt employees, such as firefighters fighting a wildfire and workers inside buildings or vehicles with mechanical ventilation, for example.

Communication and Training Requirements

Employers are required to update, communicate, and train employees about wildfire smoke and these health and safety regulations. Employers should consult with an employment lawyer to update workplace policies and employment handbooks to reflect these new regulations.

Next Steps

California businesses must comply with these new health and safety regulations. The first step, however, is to investigate if your business is required to comply with these rules. To learn if your business is exempt from the new regulations, contact an employment law attorney. Secondly, employers will need to create policies and procedures to satisfy the planning, education, and training components of the regulations.

Wildfires are disruptive to employers and employees alike. Like other natural disasters, you must anticipate your wildfire response to maximize employee safety while minimizing disruption or intervention into the work of your organization.

Employers should meet with an employment lawyer at least once a year regarding new laws or changes to regulations that might impact their business. Employment handbooks should be reviewed annually, and updated at a minimum every three years. It is important to keep current and comply with federal, state, and local labor and employment laws to protect your company and employees. If you are a business in Fremont, Newark, Hayward, East Bay, Milpitas, Union City, San Leandro, Gilroy, San Jose, or Santa Clara, California, consult legal counsel today to learn how to bring your business in compliance with the new emergency regulations to protect employees from wildfire smoke.

california air quality, employee training, employer safety regulations, wildfire smoke employment law

Resolving Employee Disputes Before You are Sued

Preventing employee lawsuits and other legal claims is more challenging than you might think for a business. When your company is experiencing a staff problem such as an employee who continually comes in late, frequently takes days off, or is not performing his or her job, your first inclination may be to terminate that person.

Confusion Surrounding “At Will” Employment

Many employers believe that because employment is “at will,” meaning an employee may be terminated with or without cause, that their actions against an employee are justified. However, even when the employment relationship is “at will,” some employers hold on to problem employees out of fear that the employee will make a claim against them or sue them for workplace discrimination.

A situation such as this is difficult to resolve without support from legal counsel. If you are facing this challenge, it is important to seek legal advice from an attorney as to the proper way to terminate employment and to understand fully the legal risks associated with such a termination.

Legal Counsel for Employers Resolving Employee Disputes

An experienced California employer lawyer can assist your business by:

Reviewing your documentation
Helping you with your discipline process
Determining whether an employee has a protective status (i.e.: federal and state sick leave laws, disability laws, Title VII laws, etc.)
Evaluating what types of claim an employee could make, and the status of your company’s documentation to fight such a claim.

Often, we find that employers take action first and then belatedly seek legal advice when the employee makes a claim.

At this point, employers often realize that it is costly to resolve a claim after mistakes have been made. A knowledgeable employment law attorney cannot change the facts but will defend the employer and try to get the best outcome, minimizing monetary and reputational damage.

Relevant and timely legal advice regarding employment issues helps minimize problems before they arise. An attorney can help you understand the various federal, state, and local employment laws and make critical changes to your business practices to avoid further claims in the future.

The Importance of Documentation

Any employment conflict could potentially result in litigation. It is important that you, as an employer, comply with California law in all aspects of your business’s employment policies and procedures, including such items as policy training, complaint investigations, hiring and promotion practices, management development, and employee training. You must also keep documentation of these as proof that you are following California law. Your good faith efforts to prevent employment discrimination, harassment and retaliation, and maintain a safe working environment may serve you well – creating a shield or defense to employee litigation.

If you are an employer in the East Bay Area including the communities of Fremont, Hayward, Union City, Milpitas, or Newark, California seek legal advice and counsel of a local business lawyer today.

disputes, employees

Three Labor Laws Every Employer Needs to Know

With unemployment rates hitting record-breaking lows and startups growing all around the Bay Area, companies in the Silicon Valley can’t fill roles fast enough. Whether you are planning to grow your team or hiring for the first time, our labor and employment attorney is an expert on the ever-changing laws. Here are three new employment laws to consider and tips for ensuring you are compliant:

Salary History Ban – Per section 432.3 added to the Labor Code in October of last year, employers may not request salary history, nor may they base a salary offer on an applicant’s salary history. Before your candidate search, our employment lawyer can caution you on the crucial topics you can and cannot discuss during the interview process and throughout the tenure of your employee.
Minimum Wage – According to MW-2017 which went into effect this year, minimum wage for companies with 25 or fewer employees is $10.50 an hour and for companies with 26 or more employees, it’s $11.00. Our labor law firm can help you not only ensure you are compliant with the most up to date minimum wage, but also how you can prepare for the slated increase to $15.00 an hour by the year 2023.
Sexual Harassment Prevention – SB 1343 (an amendment to Sections 12950 and 12950.1 of the Government Code relating to employment) states that companies with 5 or more employees are required to train all employees on sexual harassment prevention by January 1, 2020. What exactly does a training need to include? What sexual harassment documentation does a company need to have accessible to employees? Our trusted employment lawyer is an expert on these requirements and here to help you ensure your company abides by the law.

Labor and employment laws change frequently, so we recommend all employers large and small, new and old, have regular legal consultations to remain lawful. To ensure your recruitment team and office space are set up for success, especially in Fremont, Hayward, Union City, Castro Valley, Milpitas, or Newark, CA, call Lynnette Ariathurai to schedule a consultation.

employment law, sexual harrassment, wage law

2019 New Sexual Harassment Laws

Beginning January 1, 2019, the California legislature adopted several laws in the workplace with regards to sexual harassment claims against employers. These laws will impact any employee claims that have not reached resolution, even though the cause of action, claim or lawsuit may have arisen prior to the implementation of the new laws. Staying up to date with the newest laws and implementing this knowledge correctly can save employers hundreds of thousands of dollars and countless hours in court. The most significant changes in the laws regarding sexual harassment are as follows:

1. SB 820 prohibits employer in a settlement agreement where sexual harassment, assault or discrimination has been alleged including a confidentiality clause prohibiting disclosure of the facts regarding the claim, except the victim’s identity.

2. SB 1300 makes non-disparagement agreements preventing employees from disclosing the unlawful acts in the workplace, including sexual harassment, against public policy.

3. SB 1300 also makes not enforceable, agreements not to sue or bring a claim against the employer under FEHA, in exchange for a raise or bonus, or as a condition of (continued) employment.

4. SB 1343 states that all employers with 5 or more employees are required to provide 2 hours of sexual harassment training to its supervisor, and 1 hour to other employees within 6 months of hiring and every 2 years thereafter. The initial training needs to conclude before January 1, 2020.

5. AB 2770 protects victim from claims of defamation by alleged harasser when employee reports sexual harassment based on credible evidence and without malice. Even if the claim is found to be false and the accused’s reputation is ruined.

6. AB 2770 also permits an employer to reveal to prospective employers on a job reference, the reason for employee’s inability to be rehired – if the employer determined that employee had engaged in sexual harassment.

Staying up to date on current employment laws is the easiest way to protect an employer. Often times employer thinks that just knowing the law is protection enough. My law office provides legal services in the best implementation of these laws, and dissolving confusion around the laws from the employers perspective. A consultation with an employment attorney can often save the employer time and peace of mind in regards to avoiding unnecessary litigation or tumultuous relationships with their employees.

I have represented a multitude of businesses in resolving claims against employers through pre-litigation, California and federal agencies, including the Labor Commissioner, EEOC and several others.

Litigation is sometimes the first notice of an allegation an employer receives, in which case a lawyer is even more pertinent and can be indispensable to that process. Every claim I have worked on has resulted in a satisfactory resolution for the employer, even in cases where initially there were stark differences in opinion. Settlements, although not always unavoidable, can be an option in which we can still reach a solution that satisfies the employer as well as discouraging future litigation from employees.

If your business is seeking information, guidance or protection for existing or possible sexual harassment claims in Fremont, Hayward, Union City, Castro Valley, Milpitas, or Newark, CA, please contact the Law Office of Lynnette Ariathurai.

california laws, employer responsibilities, sexual harrassment

New Supreme Court Ruling Impacts Companies with Independent Contractors

Companies desire to hire independent contractors rather than employees to save money on overtime pay, payroll taxes, and unemployment and worker’s compensation insurance, just to name a few benefits. But are companies taking advantage by misclassifying workers? Ride sharing and food delivery are a few of the big industries that retain independent contractors, but also within the tech industry, companies can independently contract software programmers, graphic designers, digital marketers and pretty much any kind of service-based freelancer. With technology making our world more interconnected, independent work is only getting easier and therefore the need for an employer to consult with a labor lawyer is more important than ever.

A new court ruling is dramatically changing the rules for how to determine whether a person is an employee or an independent contractor. So if you employ or are thinking about hiring independent contractors, our employment attorney can ensure you’re compliant with the most current labor laws. The Supreme Court ruling on April 30 (Dynamex Operations West, Inc. v. Superior Court of Los Angeles, No. S222732) is more clearly defining how workers are classified as employees or independent contractors. In order to be considered an independent contractor, a worker must be ‘free from the control and direction of the hirer in connection with the performance of the work.’ Based on this ruling, workers whose employers are directly connected to their work (such as drivers connected to passengers through ride sharing companies) cannot be classified as independent contractors and rather should be considered employees. This ruling seems to be directed at companies such as Uber and Lyft.

While companies save on financial obligations by retaining independent contractors, the legal responsibilities are crucial and penalties for misclassification can be severe. There are both civil and criminal penalties against companies and their owners/operators who wrongly classify an employee as an independent contractor.

Our full-service labor law office can not only help you understand whether any of your workers should be considered employees or independent contractors but can also ensure you have the proper contracts and documentation in place to retain your workers. With over 20 years of employment law experience, our labor lawyer is an expert in California labor laws.

Businesses in Fremont, Hayward, Union City, Castro Valley, Milpitas, or Newark, CA, can call to schedule a consultation with our employment attorney before hiring to understand how to legally employ independent contractors.

contractor vs employee, independent contractors

The Dangers of Trying to Resolve Business Disputes on Your Own

On behalf of The Law Office of Lynnette Ariathurai, A Professional Corporation posted in Contract Disputes on Tuesday, May 24, 2016.

One of the most common mistakes that small businesses make is trying to resolve disputes on their own. In an effort to save money – and thinking that the issue or conflict will simply go away – many small business owners do not take a proactive approach to dispute resolution.

Disputes don’t just go away. Particularly if the opposing party hires a lawyer of their own. It is critical that you take potential legal issues seriously and work with a trusted business law attorney to resolve the dispute as quickly as possible, protecting your long-term interests.

Here are a few things to keep in mind when faced with the threat of business conflict:

If you are contacted by an attorney of an opposing party, respond only through your own lawyer. Anything that you say in response will be evidentiary. You run the risk of accidentally making a statement that could cost you significantly or misspeaking in a way that can be used against you. Immediately contact your lawyer and only communicate through legal representation.

Be aware of disgruntled employees. If you suspect that an employee is upset for any type of employment law or human resources related matter, immediately seek the counsel of your attorney. You may have made a mistake or error that could result in a lawsuit. A lawyer can help you resolve the matter before it escalates.

Make sure that you understand your contracts and agreements in place.Hopefully you have worked with a skilled business law attorney in advance to create a contractual infrastructure that will protect the business in case of conflict. If you sense that a dispute is coming, review these contracts with your attorney and address any weaknesses immediately.

Do not try to make any under the table agreements. Far too many business owners try to make problems go away by throwing money at them or negotiating foolish agreements on their own. Always seek the guidance of a lawyer before making an agreement. Allow your attorney to conduct prudent negotiations on your behalf.

Remember that mistakes you make during disputes could come back to haunt you. Each decision you make during this period of time is critical and an error could have long-term implications – some could sink the business.

The Law Office of Lynette Ariathurai partners closely with businesses throughout the Bay Area to ensure they make sound decisions and provides strategies that resolve disputes efficiently and in a cost-effective manner. Take conflict seriously and seek trusted legal guidance. Click here for more information.

business disputes, Contract Disputes, employee disputes, partner disputes

Protect Your Small Business from Disruptive Litigation

On behalf of The Law Office of Lynnette Ariathurai, A Professional Corporationposted in Business Formation & Planning on Tuesday, April 26, 2016.

One of the greatest fears that many small business owners have is the potential to be sued. If they have set up the proper legal entities and worked with an attorney to structure their business in a prudent manner, lawsuits and litigation do not mean that the business is at risk of being wiped out.

Lawsuits are dangerous to a business, nonetheless. Studies find that even if the business wins the lawsuit, lawsuits still weigh heavily on the balance sheet. Additionally, litigation diverts the business owner’s time and attention away from operations, developing the business, growing and ultimately making money. In some cases, businesses often adapt their operations and change the way they do business to make up for time and resources lost on the lawsuit.

If there is a threat of a lawsuit, be proactive. Do not wait for the opposing party to take legal action. Contact a skilled business law attorney immediately. If handled proactively, your lawyer can start negotiations and help you avoid going to court.

These are things you need to look for in a business law attorney to protect your business and the toll that a drawn out lawsuit could take:

Choose an attorney who takes the time to understand your business model – Your attorney should be familiar with your day to day operations, your plans for growth, the relationships you rely upon, the relationships you hope to make and your financial situation. The more time your attorney spends becoming familiar with the bones of your business, the more customized the legal solutions can be and the better the outcome of the matter.

Choose an attorney who is not afraid to go to litigation – While the goal is to avoid court, sometimes it becomes unavoidable. Make sure that your lawyer has the experience to handle complex litigation – and is prepared to take the case to court, if necessary.

Choose an attorney who is willing to partner with you – The insight your attorney gains about your company through the course of the lawsuit will be invaluable for years to come. This firm can then partner with you through the future to create the legal structures and policies that will mitigate the risk of future legal battles – and create a foundation for long-term growth.

Attorney Lynnette Ariathurai is trusted by businesses throughout the Fremont area, including Hayward, Union City, Milpitas, Castro Valley, and Newark, CA. She invests the time and resources needed to understand her clients’ businesses from the inside out and provides solutions and strategies for a sound legal foundation that will facilitate growth.

business disputes, Business Formation & Planning, lawsuit, legal partner, litigation