Today we continue with our Year in Review segment, which looks at the key labor & employment law developments from 2016 in New York, the DC Metro Area, Massachusetts, and California, while offering our thoughts on 2017. Last week we covered New York and the DC Metro Area.  Now we turn to Massachusetts.  In addition, please join us in NYC on April 6, 2017 for Mintz Levin’s Third Annual Employment Law Summit as we address some of the key labor & employment issues impacting employers in 2017.  Register here.

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2016 Massachusetts Employment Law Year in Review

From case law interpreting one of, if not, the most employee-friendly independent contractor statute in the country to Beacon Hill’s efforts to pass non-competition agreement reform, Massachusetts is certainly no stranger to key developments in the labor and employment arena. This blog post highlights the 2016 case law and legislative efforts about which every Massachusetts employer should be aware, and provides insight over what to watch for as we move our way along through 2017 and beyond.

Continue Reading 2016 Massachusetts Employment Law Year In Review

Does this sound familiar: employee disregards a non-compete and joins a competitor; former company calls foul and initiates a lawsuit; parties fight it out, but by the time litigation has run its course, the non-compete period in the underlying contract has expired.  The dispute is moot, right?  Not necessarily according to the Ninth Circuit in Ocean Beauty Seafoods v. Pacific Seafood Acquisition Company.  There, the Court applied the doctrine of equitable extension to tack on a non-compete period to an agreement after the original period had run.

Continue Reading Pescetarian’s Delight: Ninth Circuit Extends Non-Compete Term Beyond Contractual Period

As ubiquitous as limited liability company interests may be these days, litigants are still arguing over whether the sale of LLC membership units is like the sale of stock.  When a stock sale takes place, the new owners of the stock simply fill the shoes of the old stockholders.  In a stock sale, there is no “FICA” restart – the employer identification remains the same, as does nearly everything else associated with the transaction.  An asset sale, on the other hand, involves the actual transmission of tangible or intangible things to an entirely new entity.  The asset transaction invariably results in a FICA restart (a new employer, a new employer identification, and everything that comes with the “newness”) because a different entity (but not always a brand new one) now owns the assets.

Why is this relevant to non-compete agreements?

Continue Reading Purchaser of LLC Units May Enforce Non-Compete Without Employee Consent

By George Atanasov, Julie Cox, and Max Samels

On June 23rd, the Massachusetts Joint Committee on Labor and Workforce Development met to consider legislation relating to the legality and enforcement of non-compete agreements. The committee considered five bills on this topic, with the two most prominent being House Bill 1701 and Senate Bill 957, two proposals that prohibit the enforcement of non-compete clauses while permitting nondisclosure and non-solicitation agreements. Senate Bill 169 was also under consideration, which adopts a version of the Uniform Trade Secrets Act, which standardizes a company’s legal right to protect their intellectual property.

The potential policy directions discussed at these hearings ranged from moderate reform to a complete ban on non-compete agreements in Massachusetts, the latter largely supported by start-up and venture capital groups. In the reform category, one popular idea involved requiring the employers to disclose if accepting employment would require signing a non-compete at the time of the job offer, rather than on the first day of work. Supporters argue that this would avoid situations where workers may have already terminated their current employment or turned down other offers only to discover that they were ultimately required to sign a non-compete.

Continue Reading Uncertain Future for Non-Compete Agreements in Massachusetts: Legislators Seek Compromise

Written by Jane Haviland with Bret Cohen

Two Massachusetts decisions—including one from the state’s highest court—applied the same standard regarding enforcement of an agreement to arbitrate.  In each case, plaintiffs signed arbitration agreements with another party.  Others that were not a party to and did not therefore sign those agreements sought the protections of the arbitration provision, and the courts required the plaintiffs in both instances to arbitrate their claims even against the non-signatory defendants.  We briefly discuss these cases and the takeaways below.

Continue Reading Surprise! You Get to Arbitrate! Massachusetts Courts Continue to Permit Third Parties to Enforce Arbitration Agreements

When it comes to California non-competes, you can never get enough clarity.  And when that clarity comes from a Delaware Chancery Court, it adds a utility element that our corporate brethren appreciate.

Ascension Insurance Holdings, LLC v. Underwood involved a pretty straightforward scenario: a Delaware limited liability company purchased certain assets and goodwill from an insurance company partially owned by Robert Underwood – a California resident.  Even though the LLC did business exclusively in California, the transaction documents called for the choice of Delaware law.  Given that Delaware enforces choice of law clauses and California permits non-competes when someone sells their equity interests, game over, right?

Continue Reading More on California Non-Competes – But This Time from Delaware

Those of you reading our Employee Mobility blog posts are familiar with California’s unique approach to non-compete agreements: they are, except in a few limited circumstances, unenforceable in the Golden State. And that unenforceability extends to post-employment non-solicitation provisions restricting individuals from soliciting business from former customers — a “warm market” to those in the know in the sales community.

But a recent decision highlights an exception to this (infamous) California ban on post-employment solicitation.

Continue Reading California Sunshine Warms the Market: A Twist on Customer Non-Solicitation Provisions in the Golden State

For those of you following the saga our Employee Mobility Practice Group has been documenting about the many ways in which social media appears to be impacting the non-compete world, I present to you yet another case that highlights the treasure trove of evidence that LinkedIn may provide.

Continue Reading Yet Another Tale of (Alleged) LinkedIn Indiscretion in a Non-Compete Matter

Post-Employment Restrictive Covenant AgreementsWritten by David Katz

A recent non-compete case out of a New York County court offers employers valuable drafting tips on non-compete and non-solicitation provisions.

Continue Reading Et tu, Brutus? Yet Another New York Court Offers Guidance on the Do’s and Don’ts (Mostly Don’ts) in Post-Employment Restrictive Covenant Agreements