employment contracts

mhees10076

Hi Everyone,
Need your help one more time. We have employees in several states. The CEO is in California and employee in question is an employee of Alaska. In regards to the employment contract signed by both parties, which state's employment laws preside? And in regards to employment references, if this employee has the intention of working for a company that we will shortly be partners with, can we be liable for giving employment history and problems with this employee to our future partner if we don't have an authorization from employee? I want to thank you all for your input as I am fairly new in this position. Thanks, Marlene

Don D

>Hi Everyone,
>Need your help one more time. We have employees in several states.
>The CEO is in California and employee in question is an employee of
>Alaska. In regards to the employment contract signed by both parties,
>which state's employment laws preside? And in regards to employment
>references, if this employee has the intention of working for a
>company that we will shortly be partners with, can we be liable for
>giving employment history and problems with this employee to our
>future partner if we don't have an authorization from employee? I
>want to thank you all for your input as I am fairly new in this
>position. Thanks, Marlene


The unemployment laws of the state in which his office or principal location is will be the ones that apply. If he does not have an office, it will be state opf his residence. Unless he is based physically in your state, your state regs will be irrelevant. On the other part of your question, I think it would be determined by the level of certainty that exists that this other company will actually become part of your company or might own your company. "Partnering with" I do not think is good reasoning for sharing personell files. Only if they are going to have a direct reporting relationship, up and down (or laterally/horizontally as might be the politically correct thinking) with the ee would I share the file. Otherwise, there doesn't seem a need to know all the details of the file.

Margaret Morford

Be sure to include as a provision in your contract that the laws of the state of ____________ shall apply to all provisions of this contract.

Margaret Morford
theHRedge
615-371-8200
[email]mmorford@mleesmith.com[/email]
[url]http://www.thehredge.net[/url]

Don D

Margaret: One company I was with used to do that until a judge ruled that the company cannot dictate the application of the law. This applied to comp and UI and one line of insurance. I think this particular judge was in Texas.

Margaret Morford

I was speaking of the employment contract itself, not the employment relationship. That will be governed by various state laws as Don D pointed out. There has to be some tie that exist between the parties to the contract and the laws of the state designated in the contract. You can't just arbitrarily pick a state. I would still include that provision in the contract language because it bolsters your arguement about which state law will apply to interupting the provisions of the employment contract.

Margaret Morford
theHRedge
615-371-8200
[email]mmorford@mleesmith.com[/email]
[url]http://www.thehredge.net[/url]

Theresa Gegen TX

As to which law applies -- It all depends on the contract, the facts about where the contract was entered, performed and breached, the particular issue and the state.

In texas, you cannot agreed to apply another state's law for a non-compete. But you can agreed to apply another state's law for some other issues. It is a very technical legal question. It cannot be answered without an attorney looking at the contract and the facts behind the contract (where it was entered, where it is to be performed, etc) and the laws of each of the states.

Some states will reject other states laws on grounds of public policy, some states will require the person who wants the other state's laws rejected to prove that the other states laws will not give relief, and some states will apply the laws as selected. But a judge in Texas, for example, applying California law, can be expected to make a lot of mistakes in doing it.

Good Luck!!

jimlegal

In your employment contract the parties may agree upon a forum selection clause that limits "exclusive" jurisdiction in one state and for that matter county. Having recently addressed this issue the key word is "exclusive", so said the California court. In fact their is a 9th circuit case on this very point. Thus, when you are drafting your contract you may wish to include a paragraph which states something about the "exclusive" jurisdiction resides in whatever county, California. This is diffently an issue that should be reviewed by your company's attorney! Good luck with your situation.