This week's topics ...

(1) FLSA Lawsuits Hit Record in 2015

Our top story this week: Fair Labor Standards Act lawsuits hit a record high in 2015. The number of federal wage-and-hour suits rose almost 8% this year. There are many reasons for the increase, including more worker-friendly rules and increased publicity around minimum wage and overtime issues. Some point to the difficulties of applying an outdated law to our modern-day economy.

(2) Restrictive Covenant Binds Bad Leaver

A bad leaver pays a hefty price. . . . A former VP of Fortinet, Inc., must pay nearly $1.7 million to the company, after poaching three of his subordinates when he left his job for a competitor. The former VP joked in an email that the employees he took with him were “three bullets to the back of the head” of his former employer. In the arbitration, a former California state judge ruled that the former VP had breached his fiduciary duty and his contractual obligations not to recruit employees of the company for a year after he left. 

(3) Ninth Circuit Urged to Revisit PAGA Ruling

Business groups ask the U.S. Court of Appeals for the Ninth Circuit to reconsider its Private Attorneys General Act (PAGA) waiver ruling. The Ninth Circuit accepted three amicus briefs from the U.S. Chamber of Commerce and other businesses, asking the court to rethink its ruling. The Ninth Circuit’s split decision in September found that class action waivers for California employees are unenforceable under the PAGA. This ruling reaffirmed the California Supreme Court’s 2014 Iskanian ruling.

(4) Temp Worker Qualifies as Employee in Title VII Claim

Temp workers are considered employees in a race bias suit. The Third Circuit recently ruled that a temp worker assigned to a retail store can be considered an employee of that retailer. The plaintiff is alleging that management at Tuesday Morning retail stores discriminated against African-American employees, resulting in their termination. The court found that there is a “common-law employment relationship” between the temp workers and the retailer that satisfies the requirements for claims under Title VII of the Civil Rights Act of 1964. This decision supports a growing consensus in the courts and from regulators that a company will likely be considered a joint employer if it controls the day-to-day activities of a temp worker.