LinkedIn Activity May Violate Non-Solicitation Agreements

Q: A former employee has invited some of her former co-workers and clients to connect on LinkedIn. Is this a violation of her non-solicitation agreement with our company?

A: It depends. In general, a generic invitation to connect will not be viewed as a violation of a non-solicitation agreement.  However, if an invitation is accompanied by a personalized message or other targeted communication, it likely will be viewed as a violation.

In recent years, non-solicitation allegations have increasingly centered around the use of social media, and most prominently, LinkedIn. Employees argue that LinkedIn invitations are simply a way to keep in touch and maintain their professional networks.  In contrast, employers argue that LinkedIn invitations are an easy way for employees to solicit former colleagues and clients under the guise of connecting on a social network.  After the connection is made, the former colleague or client can see job postings and other information about the employee’s new place of work.  Employers contend that this is no different than an employee calling a former colleague and soliciting them to apply for a position, or calling a former client to solicit business.

In Bankers Life and Casualty Company v. American Senior Benefits, a recent case before the Appellate Court of Illinois, the court sided with the employee.  There, the employer alleged that a former employee’s invitations to three former colleagues to connect on LinkedIn violated his non-solicitation agreement.  The employer argued that, after connecting, the employees could view their colleague’s  profile, which had job listings at his new employer.  The court disagreed, holding that there was no violation of the non-solicitation agreement because the invitations to connect were generic and contained no discussion of either employer.  Additionally, the former employee did not suggest that his former coworkers view job postings at his new job or leave their employment with the company.  The court noted that if the employees accepted the connection, their next steps, which may have included viewing job postings on the new employer’s website page, were not actions for which the former employee could be held responsible.

By contrast, in Mobile Mini, Incorporated v. Citi-Cargo, a Minnesota District Court case, after resigning from her position as a regional sales representative for Mobile Mini, a former employee updated her LinkedIn profile to reflect her new position with a competitor, and posted an update describing her new employer’s business and inviting people to call her for a quote.  The court granted a preliminary injunction, holding that the employee’s postings were not, as the employee claimed, mere status updates announcing the employee’s new position and contact information, but rather were “blatant sales pitches” that were meant to “entice members of [the employee]’s network to call her for the purpose of making sales in her new position at Citi-Cargo.”  The court noted that, had the posts simply announced the employee’s new position and contact information, it was unlikely there would have been a breach.

As the cases above demonstrate, employers who want to enforce their former employees’ non-solicitation agreements should be on the lookout for employee social media activity that amounts to a sales pitch or enticement. However, a former employee who simply announces her new position and provides contact information likely will not be considered to have breached the agreement.

Pepper lawyers have seen a significant increase in both threatened and filed lawsuits relating to non-compete and non-solicitation agreements in the past year. Many of these agreements have imprecise language, which results in confusion on the part of the employee, former employer and new employer as to what kind of action constitutes solicitation, and often leads to disputes about the scope and enforceability of the provisions.  It is essential for employers to ensure they have clearly drafted non-solicitation and non-competition agreements so it can easily be determined whether a particular action violates the agreement.

Jessica X.Y. Rothenberg

 

Important Additions to NYC’s Fair Chance Act Limit Employers’ Ability to Perform Background Checks

Q: What do I need to know about the recent additions to New York City’s law about the use of criminal history in employment decisions?

A: While the New York City Fair Chance Act (“FCA”) has been in effect since October 2015, the New York City Commission on Human Rights (“Commission”) recently enacted final rules, which clarify many aspects of the law.  The final rules went into effect on August 5, 2017.

The key provision of the FCA prohibits employers from inquiring about an applicant’s criminal history until after a conditional offer of employment has been made. The final rules explain the meaning of a conditional offer, and clarify the steps an employer must take before revoking a conditional offer or taking an adverse employment action.

A conditional offer is defined as an offer of employment, promotion, or transfer. It is essential for employers and all relevant decision makers to understand that the FCA’s provisions cover far more than just an initial offer of employment – they also cover promotions and transfers.  The FCA provides that a conditional offer can only be revoked based on one of the following:

  • The results of a criminal background check (in which case the “Fair Chance Process” must be followed); or
  • The results of a medical exam, as permitted by the American with Disabilities Act; or

Other material information the employer could not have reasonably known before making the conditional offer if, based on the material information, the employer would not have made the offer.If an employer wishes to rescind a conditional offer based on a criminal background check, the employer must follow the “Fair Chance Process,” which is described in section 8-107(11-a) of the New York City Administrative Code. This includes providing the applicant with a copy of the background check report and an analysis of the factors that went into the decision (the list of acceptable factors is in Article 23-A of the New York State Correction Law), and allowing the applicant to address the criminal history at issue before the offer is rescinded. A sample notice approved by the Commission is available here:

http://www1.nyc.gov/assets/cchr/downloads/pdf/FairChance_Form23-A_distributed.pdf.

The final rules also added a number of per se violations. Engaging in such action is considered a violation regardless of whether the employer takes an adverse action against an employee. Fines for per se violations range from $500 to $10,000, depending on the facts and whether the employer has previous FCA violations. Per se violations include making any inquiry or statement about an applicant’s criminal history before a conditional offer is made, and using applications that require applicants to consent to a background check and/or provide information about criminal history. The use of such applications is a violation even if the application contains a disclaimer that states New York City applicants should not answer certain questions. This prohibition is quite unusual and runs counter to many employers’ practices of using nationwide or multi-state employment applications.To ensure FCA compliance, employers should review their existing policies and practices, and ensure key personnel are up to date with the FCA requirements. Employers should consult a labor and employment law attorney with any questions.

— Jessica Rothenberg

Zero Tolerance Drug Testing Policies in the Age of Medical Marijuana

Q:  My Company wants to institute a drug testing policy that would automatically disqualify an applicant for employment if they test positive for illegal drugs, including medically-prescribed marijuana. Is this legal?

A.  The law regarding the responsibility of employers to accommodate medical marijuana use continues to evolve as more states pass laws allowing for marijuana use for medical and recreational reasons. In Pennsylvania, for example, the law is silent as to whether an employer can rely upon a positive drug test as a reason to reject the applicant for employment. However, the statute lists specific areas in which employers may prohibit employees from working while under the influence of marijuana – operating or controlling government-controlled chemicals or high-voltage electricity, performing duties at heights or in confined spaces; and performing tasks that threaten the life of the employee or his/her coworkers.  By implication, outside these specified areas, employers may be required to accommodate marijuana use, so long as it does not occur at work.

In New York, the law goes even further, providing that certified patients shall not be subjected to “disciplinary action by a business” for exercising their rights to use medical marijuana. A patient with a prescription for medical marijuana in New York State is considered to have a “disability” under the New York State Human Rights Law.  This means that New York employers must provide reasonable accommodations to employees or prospective employees who are certified to use marijuana for medical reasons.

The Massachusetts Supreme Judicial Court recently ruled that employers may be held liable for disability discrimination under Massachusetts state law if they fire an individual for using medical marijuana. In that case, the employee was fired after her first day of work for failing a drug test, despite the fact that the employee had informed the company that her doctor has prescribed marijuana as a way to manage her Crohn’s disease.  The court held that using medical marijuana is as lawful as using any other prescription medicine, despite the fact that it is illegal under federal law.  Further, the court stated that it would be a reasonable accommodation for an employer to allow its employees to use medically-prescribed marijuana away from the employer’s place of business unless the employer can show undue hardship.

It is quite possible that the growing number of states that have enacted medical marijuana legislation will follow the lead of the New York legislature and the Massachusetts court in adding medical marijuana use – at least outside of the workplace – to the list of accommodations that are considered to be reasonable. That means that employers will not be able to rely on positive drug test results for marijuana for employees working in non-safety-related positions without engaging in the interactive process with the employee or applicant.  The employer will have to analyze whether the employee’s use of marijuana outside of working hours will prevent the employee from performing the essential functions of his or her job.  Moreover, the employer will want to monitor the employee to ensure that the accommodation does not impact the employee’s job performance.

– Tracey E. Diamond

 

Physical Exams as a Condition of Employment: Are They Permissible?

Q.  My Company would like to have all applicants for employment submit to a pre-employment physical examination to ensure that they are fit for the position. Is this allowable?

A.  Employers may require an applicant to submit to a pre-employment physical examination, but only after a conditional offer of employment has been made, and even then only under the following conditions:

  • All other candidates in the job category must also be required to submit to the physical;
  • The candidate’s medical history is kept separate from other employment-related records and is treated confidentially; and
  • The results are not used to discriminate against the applicant under the Americans with Disabilities Act (“ADA”) or other discrimination laws.

To ensure that there is no ADA violation, the physical examination should be limited to an assessment of whether the applicant is able to perform the duties of the position, with or without an accommodation. To avoid a claim under the Genetic Information Nondiscrimination Act (“GINA”), the physician should not request information about the applicant’s family medical history.

It would be helpful to provide the physician with a copy of the job description prior to the examination so that the physician is familiar with the responsibilities expected of the position.

Employers will want to tread carefully in making an adverse employment decision based on the results of a physical exam. The applicant’s offer may not be rescinded unless the issue is job-related and consistent with business necessity, or creates a direct threat to health and safety of the applicant or others, and the condition cannot be reasonably accommodated.  Moreover, the company could violate discrimination laws if it rescinds an offer based on non-medical information learned as a result of the physical (for example, the applicant’s age, religion, etc.)  Likewise, employers could land in hot water if they rescind an offer after learning about an employee’s pregnant condition as the result of the exam.

–Tracey E. Diamond

Pitfalls and Best Practices When Hiring for the Summer Season

Q: I hire seasonal employees for the summer.  Are there any particular considerations I should be aware of?

A: Seasonal employees can provide much needed support during the summer months.  However, there are certain issues to consider.  First, it is important to clarify upfront that employees are only expected to work for the summer, while at the same time reminding employees that the relationship is at-will and can be ended at any time by either party.

Another issue to consider is benefits. Many employers do not provide seasonal employees benefits other than what is legally mandated.  That practice is fine from a legal standpoint so long as it is applied consistently.  In terms of legally mandated benefits, it is essential for employers to understand which benefits apply to seasonal employees.  In certain circumstances, larger employers may be required to offer certain seasonal employees health benefits under the Affordable Care Act.  Moreover, depending on the jurisdiction, seasonal employees may be eligible for paid sick leave.

In New York City, for example, most employers have to allow employees who work more than 80 hours in a calendar year to accrue sick leave. While sick leave begins to accrue on the first day of employment, however, employees may not use sick leave until 120 days after the start of employment.  Thus, most seasonal workers will accrue sick leave, but will not be employed long enough to actually use it.  In contrast, Philadelphia’s sick leave law explicitly excludes seasonal workers, who are defined as people who have been hired for a temporary period of not more than sixteen weeks during a calendar year.

Seasonal employees also would be eligible for worker’s compensation benefits and potentially may be eligible for unemployment insurance benefits.

In addition to the benefits issues, employers also should be aware that seasonal employees are subject to the same wage and hour laws as other employees. Under federal law, non-exempt employees (whether seasonal or not) must be paid overtime for hours worked over 40 in a week.  Employers should be sure to be in compliance with state law requirements for overtime, as well as meal and rest breaks.

For employers who organize summer company events, such as barbeques, if attendance is mandatory, employees (including seasonal employees) should be compensated for their time. If attendance is truly voluntary, then employees who attend the event do not need to be compensated for their time. Consider establishing guidelines for appropriate employee conduct at such social events, particularly if they include alcohol.

Finally, while it may be tempting for employers to bypass the standard hiring and orientation processes for seasonal employees, it is crucial that seasonal employees are given policies and training in key areas, such as non-discrimination and harassment. In particular, employers should emphasize policies on sexual harassment, as well as other forms of harassment, and make clear that their policies apply equally to both seasonal and non-seasonal employees.  In addition to ensuring seasonal employees themselves are trained on such policies, it is also important for all employees to understand that seasonal employees are covered by the policies.  Employers who employ seasonal employees should consider revising their written policies so that seasonal employees are specifically included in the list of individuals protected and subject to anti-harassment policies, as well as EEO policies more generally.

Jessica Rothenberg