Employment Law

           Employment Law

Introduction

Employment laws encompass the legally binding agreements between the employees, and their employers. The employment law contains various federal statutes, judicial decisions, and administrative regulations. The significant components of employment law include unemployment compensation, pensions, and employment discrimination. Almost all businesses use employment laws to govern the relationship between employers and employees. There are different subjects in the employment law, which are meant to protect the rights of the employees by preventing discrimination, and promoting health, and safety of the workers. The law also prevents work disruption as a result of disputes between labor, and management as seen in the case of Beth, and ABC Cosmetics Inc.

Question:

Beth, a Web developer, has worked for ABC Cosmetics, Inc. (ABC) for two years in their New York location. ABC has corporate offices in the states of New York and California. When she started employment at ABC she signed several forms, including an acknowledgement of receipt of an employee handbook. The employee handbook has a prominent disclaimer in the introduction and in large text on its own page of the handbook. Additionally, disclaimer language is included in the acknowledgement. She also signed a non-disclosure agreement (NDA) and a non-competition agreement. The relevant language from these agreements are included below. Non-competition Agreement

During the period of my employment by ABC Cosmetics, Inc. (ABC), I shall not, directly or indirectly, alone or as a consultant, partner, officer, director, employee, joint venturer, lender or stockholder of any entity, engage in any business or activity that is in competition with the products being developed or sold by ABC in the continental United States of America for one year following the termination of my employment, regardless of the reasons for my termination.

Non-disclosure Agreement

I shall not at any time, whether during or after the termination of my employment, reveal to any person or entity any Confidential Information except to employees of ABC Cosmetics, Inc. who need to know such Confidential Information for the purposes of their employment, or as otherwise authorized by ABC in writing.

A start-up, XYZ Makeup, LLC (XYZ), approaches Beth and informs her that if she moves to California they can offer her a management position which will pay two times the amount she is earning at ABC. ABC asks Beth if she has been freelancing and she denies it. ABC terminates Beth because she has been freelancing even though she denies it. They also file a Temporary Restraining Order (TRO) preventing Beth from accepting the position at XYZ. Beth moves to California but XYZ rescinds the job offer because of the TRO. Beth has filed lawsuits against ABC and XYZ for breach of contract.

Issues                          One major issue is the claim by the ABC Cosmetics Inc. that Beth went ahead to freelance despite consenting to the Non-competition Agreement. Another problem is regarding the irreparable damages the management of ABC think the freelancing deal will cause to the company. Under the criteria for the Temporary Restraining Order (TRO), one fundamental question we should ask is: was the judge convinced that the TRO was necessary? Was there a good amount of evidence before the court, showing that Beth was freelancing? From the evidence presented by ABC Cosmetics, the ABC should be granted TRO since Beth was purportedly freelancing. Provided the state the ABC files is within the continental USA, the TRO should be granted if the judge is satisfied with the evidence before the court, before the ruling.

Rules                           Under the Non-competition Agreement, an employee of the ABC Cosmetics Inc. shall not directly or indirectly engage in any form of business, or an activity that is competing with the ABC’s products being developed, or sold by the company in the continental USA for one year following the employment termination regardless of the reasons. Additionally, the Non-disclosure Agreement stipulates that, whether during or after the employment termination, an employee of ABC shall reveal the confidential information about the company to any person or entity, except to the employees of ABC who deserve to get such information (Painter & Holmes, 2015). These rules are not pertinent to ABC only but apply as common law to any business entity. However, variation may be in the period for the expiry of the rules upon the termination of the employment.

Analysis                                  The binding agreements between the employer, and the employee are formally put down in writing when signing the employment documents. Throughout the employees stay at the company, the areas of jurisdiction for the employee are purely determined by the contents of the agreements (Barton & Smith, 2019). By signing these documents, an employee accepts the terms, and conditions of the company for the time he or she will be engaged by the firm. A similar case is presented in the employment agreement between Beth and ABC Cosmetics Inc.

Nevertheless, the XYZ Company, which offers competitive products to ABC approaches Beth with what seemed to a better employment deal. The ABC learns about the freelancing deals Beth was involved in, and terminated her contract, invoking the laid rules under the Non-competition, and Non-disclosure Agreements. Therefore, the lawsuit filed by Beth against ABC for the breach of contract is invalid. Even though ABC acted within the provisions of the rules, the same rules provide the legal frameworks under which TRO can be invoked; and in this case, the judge must be satisfied by the claims to give the TRO (Mazaroff & Horn, 2018). TRO exists within the legal frameworks of the employment laws, and can be invoked when necessary by a judge presiding over a case. In this case, there is no appeal for the judge’s decision on the TRO (Mazaroff & Horn, 2018).

The claim by Beth against the XYZ for the breach of contract is valid. First, even though Beth violated the binding agreements between her, and the employer, calling for the termination of her employment, the XYZ should have considered her after two weeks (Mazaroff & Horn, 2018). Even though the case study does not provide the period when the ABC implemented the Non-competition Agreement, it is alluded that Beth violated the agreement, and thus, her fate depended on XYZ. Secondly, the XYZ Company rescinded the offer due to the TRO effected by ABC. In this case, the XYZ acted within the legal frameworks for not employing a person already served TRO but did not take into consideration the allowable time to hire such a person (Barton & Smith, 2019). State laws vary in TRO and injunction. On average, most state laws allow for TROs up to the second week.

Conclusion                      Freelancing can lead to unprecedented levels of employment termination. Through freelancing, an employee violates both the Non-disclosure, and Non-competition Agreements. If a company decides to terminate the employment of one of their employee on such grounds, the company may extend the legal battle to filing a TRO. In this particular case, the TRO was served, implying the judge had sufficient information about the freelancing claims surrounding Beth. The TRO was thus necessary for ABC Cosmetics Inc. The TRO invalidated the claims against ABC for the breach of contract. On the other hand, the claim by Beth against XYZ for the breach of contract was validated by what could constitute the legal definition of deception.

References

Barton, J., & Smith, R. H. (2019). The Handbook for the New Legal Writer. Wolters Kluwer Law             & Business.

Mazaroff, S., & Horn, T. (2018). Maryland Employment Law. LexisNexis.

Painter, R., & Holmes, A. (2015). Cases and materials on employment law. Oxford University     Press, USA.