Irvine Business Litigation Blog

In AMN Healthcare, Inc. v. Aya Healthcare Services, Inc., the Court of Appeal held that a "Nonsolicitation of employees" provision of a standard Confidentiality and Non-Disclosure Agreement signed by employees who later left to compete against their former employer was void and unenforceable as an improper restraint of the employees' right to practice in their chosen profession.

In some workplaces, the rights of employees are disregarded, and this can be problematic for workers who are subjected to various forms of mistreatment as well as the companies that employ them. Rights violations take on numerous forms, such as cases involving discrimination, wage violations and sexual misconduct. Sometimes, employee rights violations are so serious that an employee comes to the conclusion that filing a lawsuit is necessary. These situations cannot always be avoided in all instances, but there are many steps employers can take to stamp out employee rights violations in the workplace.

For starters, it is very important to make sure that all staff members are trained on key issues such as sexual harassment, discrimination and other violations. Some people may not realize that certain behaviors constitute sexual harassment, for example, and others may not think about the impact of their behavior. Aside from training and awareness programs, employers should immediately take action if they discover that an employee's rights have been violated in any way. The incident should be carefully reviewed and any problem areas in the workplace should be addressed at once.

One of BKCG's main goals is to help our clients avoid legal problems from occurring in the first place and, with that in mind, based on our clients' experiences and recent legal developments, we suggest you consider doing the following 3 things to help your company stay out of legal peril.

1. Conduct a Cybersecurity Audit. The time to do this is now, before your company experiences a data breach, whether it be an outside hack, a ransomware demand or the loss of valuable proprietary company information to a competitor. Not only can any one of these events cause massive disruption to your business, but the costs can be devasting. For example, since 2015, California has required businesses to provide 12 months of free credit monitoring services to persons whose personal information has been subject to a data breach. Disclosure of a person's name and social security number or driver's license number can trigger this monitoring requirement. Assuming a modest monitoring cost of $100/year, if your business has a database of 1,000 such consumer records that is breached, the monitoring cost alone would be $100,000. Among the most common causes of company data breaches are: (1) not regularly installing security patches issued by Microsoft, Google, etc.; (2) giving employees administrator rights, for example, so they can install their own software updates; and (3) failing to properly train employees so as to avoid computer viruses and malware.

While a consultation with an IT professional is the best way to determine any additional steps you need to take to protect your company, here are a few simple things you can do immediately:

· Consider hiring an outside specialist IT consulting company to conduct a thorough audit of your company's current cybersecurity measures. Many such companies will do so at a low or nominal cost, and there are obvious advantages to having someone other than your regular IT services provider or in-house IT person undertake the audit.

· Conduct an inventory of employees who remotely access your company's servers and ensure that the devices they use to do so employ appropriate security protocols and have regularly updated security software. Your data is only as safe as your weakest link.

· With your IT professional's help, develop an internal company security plan which includes employee training on security training and limiting access to legally sensitive information to higher level employees on a "need to know" basis.

· Ask your commercial insurance broker precisely what types of cybersecurity insurance coverage you have under your business' existing commercial general liability policy, and what the limits of coverage are. Do not just assume that your existing coverage is adequate for your business' needs, you may need to purchase supplemental coverage.

· Determine exactly what employee and customer information your company gathers and how and where it is stored. Avoid complacency, as the law is evolving rapidly in this area. For example the California Consumer Privacy Act of 2018 will go into effect in January 2020 and will impose significant new obligations on companies' use and retention of consumers' personal information. As is always the case, ignorance of the law will not shield you from liability.

2. Immediately Review Your Company's Use of Independent Contractors. As has been widely reported in the press and online, the decision issued a few months ago by the California Supreme Court in Dynamex Operations West, Inc. v. Superior Court (2018) 4 Cal.5th 903, makes it even harder than it previously was for companies in California to legally justify characterizing a service provider as an independent contractor, rather than as an employee.

The Dynamex court adopted a three-part test used in other jurisdictions for determining whether a worker is properly considered an independent contractor under the "suffer or permit to work" standard in the California wage order in question. Commonly referred to as the "ABC test," this test "presumptively considers all workers to be employees", and permits workers to be classified as independent contractors only if the hiring business demonstrates that the worker in question satisfies each of three conditions:

There are various things to consider with respect to creating an estate plan. First, everyone's personal circumstances are unique and different types of estate plans work better for some people than others. Some people may be hesitant to set up a trust or a will, while others may have confidence in their decision. Moreover, some people may be going through a health crisis, such as a cancer diagnosis, that makes it difficult for them to concentrate on estate planning matters. For others, a serious health crisis may motivate them to set up an estate plan.

If you are going through any type of health crisis, our law office knows that your daily life may be very challenging. From doctor visits to medical costs and other hardships, there are all sorts of ways in which health problems can complicate life. Setting up an estate plan may be beneficial, however. Not only could it help ensure that your loved ones are able to receive your estate as you wish, but it could also give you a sense of relief knowing that your assets will be handled appropriately in the future. If you are facing a very serious health issue that may even claim your life, this could be especially important.