update new developments in employment law · document as the fcra disclosure. the court ruled that...
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Update New Developments in Employment Law
February 20, 2019
19-03
Employer Advisory Council of Orange County, Inc. PO Box 9575, Brea, CA 92822 [email protected] Ph: 714 794-4253
www.eac-oc.com
EAC Update February 2019 Employment Update
By Jim Hart
Please see below for new developments in employment law during February 2019. 1. The Ninth Circuit Adopts an Expansive Reading of FCRA’s Provisions Governing Background Check Disclosures. The FCRA is the federal law that regulates employer use of consumer reports, more commonly known as “background checks” or “background reports.” On January 29, 2019, in Gilberg v. Cal. Check Cashing Stores, 9th Cir., No. 17-16263, the Ninth Circuit considered whether it violated the FCRA for the employer to include various state law disclosures together in the same document as the FCRA disclosure. The court ruled that it did violate the FCRA, finding that including these disclosures violated the statute’s requirement to present the disclosure in a document consisting solely of the disclosure. Takeaway: Extraneous information should be eliminated and other legal updates may be necessary. A thorough review of these forms may help to mitigate risks that have continued to gather serious momentum over time. For more information, see https://www.littler.com/publication-press/publication/ninth-circuit-adopts-expansive-reading-fcras-provision-governing 2. The National Labor Relations Board (NLRB) Rules on Independent Contractor Status in Union Context. On January 25, 2019, the NLRB issued a ruling adopting the common-law independent contractor test in effect prior to 2014, in which various factors are weighed to assess a service provider’s proper status. This new test followed several opinions by the Board in 2014 cited to different tests to determine whether a person was an employee or independent contractor under the National Labor Relations Act. In the recent case, the Board found that SuperShuttle franchisees, who drive customers to and from Dallas-Fort Worth and Love Field Airports, are independent contractors. Takeaway: The NLRB’s standard is just one of the many varying standards in the employment realm that businesses must address with their experienced legal counsel. For more information, see https://www.littler.com/publication-press/publication/independent-contractor-vs-employee-misclassification-issue-continues
3. Second California Court Adopts Position that Employee Non-Solicitation Clauses Are Invalid Restraints on Trade. On January 11, 2019, a California federal district court issued a decision bolstering the argument that employee non-solicitation clauses are unenforceable under California
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Update New Developments in Employment Law
February 20, 2019
19-04 Employer Advisory Council of Orange County, Inc.
Page 2 of 2
ABOUT THE EAC: The EAC of Orange County is a non-profit organization established to assist businesses and to serve as a liaison with California’s Employment Development Department. For more information, visit http://www.EAC-OC.com/
You may contact the EAC Update Editor, Jim Hart, at 949 705 3003 or [email protected].
law. In Barker v. Insight Global, the judge declined to interpret narrowly another recent California state court of appeal decision finding that a clause restraining former employees from soliciting former co-workers constituted an unenforceable restraint on trade, and was therefore invalid. Takeaway: In light of these decisions, employers need to carefully consider eliminating such clauses from their employment contracts for employees located in California. For more information, see https://www.littler.com/publication-press/publication/second-california-court-adopts-position-employee-non-solicitation 4. Supreme Court Eliminates the "Wholly Groundless" Exception to Arbitration Agreements, Reinforcing the Force of Delegation Provisions. On January 8, 2019, in a unanimous Supreme Court ruled that where parties have agreed to delegate issues of arbitrability to an arbitrator, a court may not override that agreement. The Court’s decision ends a circuit split about whether, when faced with an enforceable delegation provision, courts could still hear arguments about the scope of an arbitration agreement under the “wholly groundless” exception. Takeaway: With this holding, the Supreme Court once again has reinforced its precedent that arbitration agreements should be enforced as written. For more information, please see https://www.littler.com/publication-press/publication/supreme-court-eliminates-wholly-groundless-exception-arbitration