Quick Links:

• PRE-EMPLOYMENT
• CONCURRENT WITH EMPL0YMENT
• POST EMPLOYMENT
• NON-TRADITIONAL EMPLOYMENT
• OTHER CONSIDERATIONS

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PRE-EMPLOYMENT

Employment Application Forms

Every business has different needs and requirements; however, one universal requirement is obtaining skilled workers who are honest and credible. A properly drafted application form can get information that you may not find in a cover letter and resume and may prove to be far more important. An application form can request contact information of people who would be able to verify employment, can list a few last places of residence, and give you the authorization to conduct a background investigation or even a credit check although this would require compliance with the Fair Credit Reporting Act (FCRA). This process has a number of affects, almost all of them positive for a prospective employer. First, it weeds out people who don’t want to provide the information for fear that the employer will learn of some past bad behavior and have trouble with being honest. Second, it provides you with immediately verifiable information that you can use to find out whether the prospective employee would meld well with your company’s culture. These forms are generally very simple to create and usually only require a simplistic review from an attorney to make sure that all bases are covered.

Letters of Employment:

Letters of Employment are alternatives to a formal Employment Agreement. A Letter of Employment is used primarily when the employer wishes to distance himself from any obligations that may be construed as creating a contract of employment. As most business persons know, under American law we have a system of “at will” employment. Technically this means that nobody can be forced or coerced to work, it is a voluntary arrangement whereby both the employer and the employee retain the right to terminate it at will. It is expected that both the employer and the employee will mutually gain from the arrangement. The employer gets to utilize the labor and skill of the employee, and the employee receives compensation. A well drafted Letter of Employment gives a simple description of the terms of the arrangement, common elements include a welcoming statement, the rate of pay or commission, the job title and job description, the location of the employment, supplies and to be furnished at the outset, amongst other items. Whether to have an attorney review these is usually a judgment call, when you are initially starting a business, it’s a good idea, but once an employer has done a few of them independently they should be perfectly capable of doing one again, however unique circumstances often come up that would make it a smart decision to consult with a seasoned legal professional.

Employment Agreements:

From extremely detailed and complex to barebones and only including essential elements, Employment Agreements are a formal way of creating a more binding solution that would provide specific remedies in cases where either the employer or the employee does not uphold it’s end of the bargain. Employment agreements are utilized primarily in cases of executives, higher level management, and circumstances where a unique skill of a worker is required. Complex employee agreements may have attorney’s for both the employer and the employee conducting due diligence, advising, and negotiating the terms. The Law Office of Barry E. Janay, P.C. represents both employers and employees in these instances.

Confidentiality Agreements:

It’s hard to imagine any business that wouldn’t be damaged if details of it’s internal processes were to be given to a competitor or even it’s customers, therefore it is very important that the individuals that are hired are subject to a requirement to keep this information confidential. While many times there is no way of finding out whether there has been a breach or leak often times it is capable of determining how it happened. A confidentiality agreement is a way of putting an employee on notice that certain information is to be kept confidential for the benefit of the organization. A good confidentiality agreement limits the scope of the information to be kept in confidence, the purpose and aim of keeping the information confidential, the parties to be kept confidential from in general (or if identifiable), and also outlines remedies that the organization will have in case their information is transmitted in violation of the agreement. Specific industries demand different levels and scopes of confidentiality. Working with an attorney to identify your organizations critical information and data preservation needs is a smart way to help prevent against other organizations gaining a competitive advantage.

Non-competition Agreements:

Non-competition agreements are often the subject of litigation and many cases can turn on different characteristics of the industry at subject for which the non-competition agreement was arranged. Non-competition agreements must be limited so that they do not get ruled as invalid as unlawful restraints of trade. Generally speaking, a non-competition agreement must be limited in terms of geographic scope and duration, in New York judge’s have what is called “blue pencil” authority to enlarge or diminish both the scope and duration of a non-competition agreement usually on the industry, geography of the business itself, and employee turnover for the position at subject. With the advent of modern technology geographic scope may be unlimited, however the duration is usually not and is often entirely dependent on the industry. A well-drafted non-competition agreement takes in all of these factors before litigation, consultation with an attorney is highly recommended. The Law Office of Barry E. Janay, P.C. is experienced at meeting the needs of it’s client’s in drafting high quality non-competition agreements as well as in litigating their validity.

CONCURRENT WITH EMPLOYMENT

Employee Handbooks:

Employee Handbooks are not only useful for your administrative staff, they are also useful for management as a simple way of directing employees without having to hold their hands and walk them through all of the day to day minutia of how the business is run. Employers also can learn quite a bit about their legal responsibilities (for example their requirements under the Family Medical Leave Act). By having a good Employment Handbook employers can also improve their work environment and reduce employee turnover. A good employee handbook does not necessarily create any legal obligations that didn’t exist prior to it being distributed to employees, can be made to be confidential to current employees (it is not always the case that this confidentiality can be maintained in court however), and basically outlines what the employee may expect from the organization and what the organization expects in return. Drafting an employee handbook can be a simple or very complex process depending on the specific needs of the organization.

POST EMPLOYMENT

Termination Letters:

Formal termination letters can provide the first line of defense in a potential lawsuit being claimed by a past employee. A termination letter should always be factually accurate and should particularize why the organization sought to end the employment relationship with the past employee. In drafting the letter, tone is almost as important as the substance. The proper tone of a letter can turn a disgruntled past employee looking for revenge into one who is going to be ready to move forward into other employment. That having been said, it’s important that any factual or legal positions taken in the letter are supportable by the underlying circumstances. Essentially, the cost of having a professional draft a termination letter after consultation with the employer has the potential to quell a problematic situation before it becomes a matter taken up by a past employee and his employment attorney.

Severance Agreements:

Traditionally a severance agreement was an agreement bargained for between a former employee and employer in order to prevent the uncertainty that might have come from a future lawsuit that arose out of an incident or series of events that occurred during employment. Modernly severance agreements are part of a package that an employer will give as part of a package of benefits that takes into account the dedicated service of the employee and assures amicable relations between the employer and employee after the employment has ended. Companies have become more generous with benefits they give to departing employees as a matter of goodwill and in case the employment will resume at a future date. Nonetheless, the traditional purpose of a severance agreement remains alive and well. Severance agreements should be kept fairly general and should absolutely not contain any admissions of guilt or unfair treatment. There are a variety of options that can be utilized in coming up with a severance agreement that will serve multiple objectives an employer may have. For example an employer should decide whether to include a clause making arbitration of the agreement mandatory, setting the governing law covering interpretation and any subsequent disputes over the agreement (this ordinarily is where the employment actually took place), place limits and options on continuance of the severance agreement, amongst other items. The Law Office of Barry E. Janay, P.C. has experience in negotiating, drafting, and litigating severance agreements that attempt to meet the needs of it’s clients and manage their actual or potential liabilities in a quantifiable way.

NON-TRADITIONAL EMPLOYMENT

Independent Contractor Agreements:

Whether a working relationship is determined to be employment or an independent contractor relationship (sometimes referred to as “consulting” or “freelancing” but generally meaning the same thing) by a state or Federal agency is largely dependent on the factual circumstances of whether the individual who was under the control of the employer and provided supplies by the employer. Factual circumstances may change over time, at the beginning of a working relationship an individual may be considered an employee, but perhaps a leave of absence is taken upon mutual consent and then later the role of that individual is reduced. Let’s further assume that the reduced role allows him to come and go as he sees fit and takes on projects as well as rejects projects offered to him. In this often occurring and fairly typical scenario you have a former employee who has by virtue of the facts become an independent contractor. The legal requirements of an employer versus a business retaining an independent contractor for his labor services are much different in some instances independent contractors are more beneficial to the employer, but in other instances they are not, there are far to many variables to say which is better in any given situation. For example, a business is not responsible for withholding Social Security or Medicare (FICA) on pay made to an independent contractor, but is responsible for withholding that and matching for an employee.

Internship Programs:

In order to have a lawful internship program it must be educational or instructive in purpose and provide a legitimate benefit to the intern. Internships can be unpaid provided that they are receiving credit towards an educational degree (or certificate). A voluntary arrangement between the employer and the intern, where the intern doesn’t get paid runs the risk of a Department of Labor Investigation. Such and investigation aims to determine whether a violation of the minimum wage / maximum hours law has been violated and recommend remedies and/or penalties (back pay is by far the most common remedy and penalties are generally not imposed on first time offenders who it appears simply made a mistake as to the application of the law). After the investigation you may choose to either accept the determination and suggested remedy or request a hearing before an administrative law judge (ALJ) working for the Department of Labor. If the ALJ determines that liability exists, there usually is a substantial penalty imposed for non-compliance with the ALJ’s orders. Appeals may be taken from the ALJ’s decision but must be done fairly soon after the decision was made. Also, an employer has the right to file a civil lawsuit against the Department of Labor if the ALJ’s decision did not comport with applicable law, evidence of bias can be proven, and all administrative remedies have been sought. Whether to contest the decisions usually requires a simple cost benefit analysis, however more often than not it is not in the Employer’s economic interest to do so. More information can be found at the department of labor’s website located on the world wide web at www.dol.gov. If your organization has an internship program and you would like to learn whether it is fully compliant with applicable labor laws such as the Fair Labor Standards Act (FLSA) please contact us using the form provided on the right side of the homepage, www.lobej.com.

Training Program Agreements:

If your business desires to take some unskilled and generally uneducated labor and teach them a particular trade in order for them to gain beneficial employment at your workplace or somewhere else, you may want to consider creating a trainee program. These programs are unique in that the labor may be utilized and no compensation paid, but only for a limited time. In order to have a legal Training Program, you must provide the trainees with educational materials and supplies, have a set schedule when training sessions are to take place, and have a means of testing the

OTHER CONSIDERATIONS:

State and Federal agencies have many different ways of categorizing working relationships which directly affect your businesses liabilities. Whether you primarily hire workers exempt from the FLSA or non-exempt, hourly wage earners, or temporary hired help for a set fee, your legal rights and obligations will differ dramatically. It’s a good idea to get an attorney’s opinion and advice on how best to go about setting up these relationships, how best to continue them, or what to do if you receive a letter indicating that an investigation is being conducted. Please contact The Law Office of Barry E. Janay, P.C. via the contact iformation provided on the homepage www.lobej.com for more information.