Employment Counseling: from Hiring through Exit, without Costly Legal Missteps

Misclassifying an employee as an independent contractor exposes the employer to back payroll taxes, unpaid overtime, and per-violation state penalties. Independent contractor agreement counsel must audit every contractor relationship annually against the applicable classification standards, since agencies regularly update the weight given to each factor and a relationship correctly classified three years ago may not survive scrutiny under current standards.

Employment counseling clients should know that a non-compete enforceable in one state may be void in another, since California, North Dakota, Oklahoma, and Minnesota refuse to enforce post-employment non-competes for most employees, while other states enforce them if they protect a legitimate business interest and are geographically reasonable. Employment litigation counsel drafting restrictive covenants must specify the confidential information, customer relationships, or specialized training that the covenant protects, since courts routinely refuse to enforce covenants not anchored to an identifiable protectable interest even when duration and geography are otherwise reasonable.

An investigation conducted by a supervisor who reports to the accused, fails to interview key witnesses, or reaches a conclusion before reviewing all evidence will not shield the employer from liability regardless of outcome. Workplace investigations counsel must confirm the investigator has the authority and independence to conduct a credible process.

The Fair Labor Standards Act exempts employees from overtime requirements only when they satisfy both a salary threshold and a duties test evaluating whether the employee's primary duties involve executive management, administrative judgment, or professional expertise, and misclassification claims aggregate all employees in the same job category. Wage and hour counsel must compare each exempt employee's actual duties against the regulatory duties tests.

An employer who terminates for performance or conduct deficiencies must show the deficiency was real, the employee received clear notice of expectations, the standard was applied consistently to similarly situated employees, and the employee had a genuine opportunity to improve. Wrongful termination counsel must also confirm that the termination does not coincide with a protected activity such as a harassment complaint, a workers' compensation claim, or the exercise of FMLA leave, since a temporal connection between protected activity and termination creates a retaliation inference the employer must rebut with evidence of an independent non-retaliatory reason.

A valid release requires consideration beyond amounts already owed and, for employees over forty, must comply with OWBPA requirements including a twenty-one-day review period, a seven-day revocation window, and plain-language disclosure of the rights being waived. Labor laws counsel drafting a severance agreement must confirm that non-disparagement and confidentiality provisions are mutual rather than one-sided where required by current NLRB guidance on protected concerted activity, and that the agreement does not purport to release future claims in a manner that exceeds what courts in the applicable jurisdiction will enforce.

The employer defeats a constructive discharge claim by demonstrating that the complained-of conditions did not rise to the level of objective intolerability and that the employee had available workplace remedies that were not exhausted before resignation. Workplace discrimination counsel responding to an EEOC charge must file a position statement presenting the employer's legitimate non-discriminatory reasons for each employment action, organizing documentary evidence into a coherent narrative, and addressing every factual allegation without volunteering information that could expand the scope of the investigation.

Once a union is certified the employer must bargain in good faith over mandatory subjects including wages, hours, and working conditions and may not make unilateral changes to those terms while negotiations are ongoing. Labor and employee rights counsel advising an employer facing a union organizing campaign must train managers on the lawful limits of employer speech during the campaign period, since threats, interrogation, promises, or surveillance of union activity expose the employer to unfair labor practice charges that can reverse an election result.