We are frequently contacted by employers with questions regarding various employment issues. The following are some questions we have received regarding travel time, together with some responses. Realize that many employment issues are fact specific. The following questions and answers are not intended to be comprehensive but to give the reader some ways to think about the issues and some citations for further research. We strongly recommend that you consult with legal counsel about your specific situation.
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THE SCENE: Suppose a Buyer and Seller agree on a purchase price for Seller’s home (for this hypothetical assume $850,000.00), they sign the customary California of Association of Realtors (“CAR”) form Residential Purchase Agreement and Joint Escrow Instructions (“Agreement”) and open escrow. Buyer deposits $25,000.00 into escrow. Buyer’s lender approves Buyer for a purchase money loan. The typical written disclosures are made by Seller. This is Buyer’s first home purchase, or at least he is not sophisticated in real estate purchases.
After loan approval and after the disclosures, Buyer removes all contingencies. Seller incurs thousands of dollars in obtaining termite clearance and in removing Seller’s junk from her yard, in contemplation of the sale. Thereafter, however, Buyer’s lender does an about face and disapproves the loan. Buyer also discovers several conditions regarding the house that Buyer believes were misrepresented (e.g., an open insurance claim, fire damage, mold, water damage and unpermitted work).
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In today’s world of business, there is an astonishing trend when it comes to long term relationships between employers and employees. According to the Bureau of Labor Statistics, “of jobs that workers began when they were 18 to 24 years of age, 69 percent of those jobs ended in less than a year and 93 percent ended in fewer than 5 years. Among jobs started by 40 to 48 year olds, 32 percent ended in less than a year and 69 percent ended in fewer than 5 years.” The reality of the situation is sometime in the near future, one of your employees will be leaving your company in favor of another company. As an employer, there are critical steps you must take in order to protect your interests.
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Issue
Can a person legally use the threat of potential criminal, administrative or disciplinary charges in addition to civil liability in a demand to an opposing party to pay a debt?
No. Due to recent clarifications in California law, a threat in this regard may be considered extortion.
Background
Prior to the initiation of the trial process, the vast majority of civil disputes are resolved by the parties outside of court. Common legal platitude claims that 95% of lawsuits result in a settlement. Demand letters are typically utilized to force parties into settling their disputes outside of court before the litigation process even begins. While these are great tools, certain types of demand letters run the risk of being considered extortion.
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Issue
Can a company prevent one of its current clients from hiring away the company's employees?
Short Answer
Possibly. Generally, the company, as an employer, cannot restrict the movement of its employees. However, some California Courts seem to suggest that a narrowly defined contract provision between a company and its client may give the company the ability to prohibit “employee raiding,” or at least make it expensive for a client to steal an employee, which might be a hiring disincentive.
Background
Under common law, contractual restraints on the practice of a profession, business, or trade were once considered valid as long as they were reasonably imposed. In 1872, however, California adopted a public policy that promoted open competition, thus rejecting the common law rule of reasonableness. This public policy is manifested in California Business and Professions Code Section 16600, which states:
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