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August 3, 2022

Colorado’s New Noncompete Law: Four Steps to Enhance Compliance

David Law

Colorado’s revised noncompete statute takes effect on August 10, 2022. It imposes strict new requirements for noncompete and customer non-solicit agreements. Here are four steps employers can take to ensure compliance with the revised statute.

Review existing templates

Under the new law, noncompete and customer non-solicit agreements (noncompete agreements) are only enforceable if they’re reasonably necessary to protect an employer’s trade secrets. Trade secrets are specifically defined under the Colorado Uniform Trade Secrets Act (CUTSA) and have a different meaning than ordinary confidential information. Unlike the old law, the new statute doesn’t contain an exception for executive and management personnel. Read more >>

July 22, 2022

Very Bad Year for Wyoming Noncompetes (And What You Can Do To Improve Yours)

by Brad Cave

Brad Cave

The Wyoming Supreme Court decided four cases in the last 12 months against the enforcement of employees’ agreements not to compete with their former employer. Although each case was unique, the tenor and direction of these decisions are bad news for Wyoming employers who rely on noncompete agreements. In addition, one of the rulings requires Wyoming employers to immediately review the reasonableness of the geographic scope and time covered by their noncompete agreements and perhaps modify those terms, or they risk being unable to enforce the agreement at all. You should act now to improve your odds of enforcing the agreements against disloyal former employees. Here’s our take on the steps you should take.

Confirm your noncompetes are supported by consideration

Contracts must be based on consideration—something of value—exchanged between the parties. All employees have employment contracts with their employers, which are supported by consideration of the job itself with its promise of payment of wages. When noncompete agreements are signed at the time of hiring, the job is the consideration. When an employer asks employees to sign a noncompete after employment begins, they must give new consideration beyond just keeping the job. Consideration can consist of anything of value that is specifically offered and accepted in exchange for the noncompete, but without new consideration, the post-hire noncompete is not enforceable. Read more >>

May 13, 2022

Big Changes at NLRB: Expansion of Section 7 Rights in 2022

David Law

by David S. Law, Holland & Hart, LLP

Under General Counsel (GC) Jennifer Abruzzo’s leadership, the National Labor Relations Board (NLRB) is poised to dramatically expand the definition of “protected concerted activity” under Section 7 of the National Labor Relations Act (NLRA). The Board also intends to take a tougher stance against employer handbook policies. The sweeping changes are likely to have a significant impact on employers in 2022 and beyond.

Redefining ‘concerted activity’

Traditionally, an activity is “concerted” for Section 7 purposes if it is engaged in by (1) two or more employees, (2) one employee authorized to act on coworkers’ behalf, (3) one employee seeking to induce or prepare for group action, or (4) one employee bringing group concerns to management’s attention. Read more >>

May 10, 2022

Can Offer Be Pulled If Job Candidate Won’t Follow Our Vax-or-Test Policy?

David Law

by David S. Law, Holland & Hart, LLP

Question: Our COVID-19 policy calls for vaccination or testing and masking “at all times.” We made a verbal offer to a candidate for a position requiring travel to trade shows, but when she learned about our vaccine-or-test mandate, she objected to sharing her vaccination status. How can we cleanly rescind the offer (which wasn’t in writing) and avoid any issues?

Answer: This is a great question. Before rescinding the offer, you should ask the candidate why she opposes the vaccine-or-test requirement. If her reason for objecting is political or ideological, you can likely rescind the offer with little risk of legal exposure. If, on the other hand, she cites a religious or medical reason, you may be required to work with her to find a reasonable accommodation. Read more >>

May 2, 2022

CDLE Issues New Guidance on Vacation, PTO, and Payroll Deductions

By Mark Wiletsky

Mark Wiletsky

The Colorado Department of Labor and Employment (CDLE) recently provided guidance for Colorado employers on two important issues: payment of vacation and paid time off (PTO) to employees upon separation from employment, and deductions from pay. While these documents are not binding, they represent the CDLEs interpretation of Colorado law and therefore provide helpful guidance to employers.

Vacation, PTO, Floating Holidays, and More. In Nieto v. Clark’s Market, Inc., 2021 CO 48, the Colorado Supreme Court held that employers must pay employees all accrued but unused vacation pay upon separation from employment. Unfortunately, that decision left open some questions for employers, which CDLE addresses in INFO #14, including:

What counts as vacation pay? Basically, any leave that can be used at the employee’s discretion, such as paid time off (PTO), annual leave, personal days, floating holidays, etc. The CDLE explains that “vacation pay” includes any paid leave for which there is no qualifying event. Leave that is based on a qualifying event, such as health needs, a designated public holiday, caretaking, or bereavement, is not considered vacation pay.
Does that mean PTO, annual days, etc. must be paid upon separation from employment? Yes, according to the CDLE. If the paid leave can be used without a qualifying event, then any accrued but unused paid time off must be paid upon separation from employment.
What about a “floating holiday” that can be used for any holiday the employee celebrates? That is not vacation pay, according to the CDLE, because it is tied to a specific qualifying event, e., a holiday the employee celebrates. However a “floating holiday” that can be used completely at the employee’s discretion is vacation pay.
If we do not have a written policy, do we still have to pay accrued but unused vacation upon separation? Yes, if you have a practice of providing vacation or paid time off, it does not matter whether the policy is written.
What about “unlimited vacation” – do we need to pay anything upon separation? No, but the CDLE notes that if the company caps the time off or otherwise does not allow for “unlimited” vacation, then you likely would have to pay any unused vacation upon separation.
Are use-it-or-lose-it policies permissible? No, according to the CDLE. Once employees earn vacation pay (regardless of the name used for such pay), they cannot forfeit such pay. Capping the amount of earned vacation or PTO that rolls over from year to year would amount to a forfeiture. The Colorado Supreme Court did not address this question in Nieto, but the CDLE’s guidance appears to be consistent with the reasoning in Nieto.
Can we cap the amount of vacation pay employees earn? Employers may set a maximum cap at which accrual stops, until such time as the employee falls below that cap.

January 14, 2022

U.S. Supreme Court Blocks OSHA’s Vaccine-or-Test Rule; Upholds CMS’s Healthcare Vaccine Mandate

By Mickell Jimenez and Curtis Greenwood

The U.S. Supreme Court, in a 6-3 decision, has blocked the Department of Occupational Safety and Health Administration (OSHA) Emergency Temporary Standard (ETS) requiring private employers with 100 employees or more to vaccinate-or-test for COVID-19 from taking effect. However, in a separate decision, the Court allowed a more limited Centers for Medicare and Medicaid Services (CMS) Interim Final Rule, requiring COVID-19 vaccination of staff working at health care facilities that receive Medicare and Medicaid money from the federal government.

The Court’s decision on OSHA’s ETS does not prohibit employers across the country from implementing their own vaccinate-or-test policies. But absent an obligation to do so, it remains unclear whether employers will choose to implement such a policy given the already challenging staffing issues and the need to comply with the myriad confusing and sometimes contradictory patchwork of laws and regulations enacted by state and local governments. Employers that implement a vaccinate-or-test policy, or other type of policy to address the impact of COVID-19 in the workplace, should ensure that the policy complies with applicable law. Particular attention should be paid to the requirement to accommodate, where appropriate, employees’ sincerely held religious beliefs and/or medical conditions. Read more >>

November 15, 2021

Utah’s New Law on Employer Vaccination Policies: What Employers Need to Know

By Bryan Benard and Kody Condos

Bryan Benard

On November 16, 2021, Governor Spencer Cox signed into law SB2004 “Workplace COVID-19 Amendments,” a bill passed during a special session of the Utah Legislature. While the bill was introduced in response to vaccine mandates contained in the Executive Orders of President Biden and the special rule or ETS from the Occupational Health and Safety Administration (“OSHA”) (which has now been stayed by the federal courts), this new law nonetheless carries significant legal requirements for Utah employers. The bill became immediately effective yesterday upon the Governor’s signature without giving employers any lead time to prepare or change policies/processes. This law does not apply to any “person” that is regulated by the Centers for Medicare or Medicaid Services related to COVID-19 (unless a state entity) or that is a federal contractor.

Kody Condos

At a high level, the bill:

(1) requires that any employer vaccination mandate include exemptions for a) health reasons; b) sincerely held religious beliefs; and c) “sincerely held personal beliefs”;

(2) prohibits employers from taking any adverse action against an employee or potential employee who is not vaccinated or asks for an exemption;

(3) requires employers to pay for any COVID testing requirements; and

(4) prohibits employers from retaining a copy of any vaccination documents but allows employers to keep a record of whether an employee is vaccinated. Read more >>

November 10, 2021

The Disappearing Future of Non-Compete Agreements

By Jeremy Ben Merkelson, Tyson Horrocks, S. Jordan Walsh, Shaun Kennedy, and Brit (Brittany) Merrill

ERE Recruiting Intelligence

Republished with permission ERE Media, Inc. Originally appeared in the November 10, 2021 online edition of ERE.net

For the last two decades, with the principal exception of California and a handful of other jurisdictions, non-competition covenants have been a standard component of the defense architecture for U.S. companies to protect valuable confidential information and trade secrets from falling into the hands of a competitor. Over time, though, this tool has been dramatically curtailed.

Hostility to non-competition agreements is growing. In July, President Biden deputized the Federal Trade Commission (FTC) to explore nationwide restrictions on their use. Additionally, in the last five years, state-law restrictions on entering into non-competition agreements with low-wage earners have been adopted in Illinois, Maine, Maryland, New Hampshire, New York, Rhode Island, Virginia, and Washington (and the District of Columbia will see new restrictions take effect in April 2022). Read more >>

November 5, 2021

New OSHA and CMS COVID-19 Vaccination & Testing Mandates: What Employers Need to Know

By Mickell Jimenez, Robert Ayers, Tyson Horrocks, Kody Condos, and Curtis Greenwood

Today, the Department of Occupational Safety and Health Administration (OSHA) issued its Covid-19 Vaccination and Testing Emergency Temporary Standard (ETS) and the Centers for Medicare & Medicaid Services (CMS) issued its Interim Final Rule (the “Interim Rule”), nearly two months after President Biden issued two executive orders in conjunction with the Path out of the Pandemic, President Biden’s COVID-19 Action Plan (collectively, the President’s Action Plan”), providing new COVID-19 vaccination requirements. While there is some overlap between the standards, we will address the ETS and Interim Rule separately. We recommend that you contact your employment and healthcare attorneys for additional guidance. Read more >>

November 5, 2021

NLRB Landscape Shifting (Again) for Nonsolicitation, Other Workplace Policies

by Steven Gutierrez

Steven Gutierrez

It should come as no surprise that President Joe Biden’s appointment of Jennifer Abruzzo as General Counsel (GC) of the National Labor Relations Board (NLRB) would effectively shift the NLRB to a prounion majority. Ever since the new Board took control, we’ve advised employers to brace for widespread rollbacks of gains they saw in the traditional labor area under the Trump administration (see “Changing of the guard: NLRB precedent under Biden administration”). In that regard, Abruzzo expressly warned employers she intends to return to the prounion agenda seen during the Obama years.

NLRB analysis of employer handbooks

One of the more controversial shifts by President Barack Obama’s NLRB was its attack on employers’ facially neutral workplace rules. For example, in Chipotle Services LLC, the Board used its 2004 precedent in Lutheran Heritage to invalidate employer rules directing employees to delete social media posts about their wages or other terms or conditions of employment. Read more >>