Listed below are three practical steps to reduce labor costs.
Wage and benefit levels are typically dictated by market forces out of the control of most employers. As a result, increased focus should be placed on the cost of failing to comply with increasingly hostile regulations. The surest way to maximize profit margins is to reduce litigation exposure and increase worker efficiency.
1. DEFINE YOUR POLICIES
Develop an employee manual to create consistency and reduce litigation costs.
The development process itself is critical. Just buying a form employee manual on the Internet will not achieve meaningful results because those cut and paste policies will not have been carefully evaluated. Well considered employee manuals offer many benefits. Primarily, manuals help employers focus on their priorities and create paths to providing consistency in the workplace. Disparate treatment is the primary cause of lawsuits. When one supervisor allows twenty-minute breaks and another never does, employees start to feel mistreated. When one person is terminated for violating a rule, but another is not, a lawsuit is often the result.
Employers lose out on certain legal defenses if they do not have a reporting mechanism in place to stop sexual harassment.
Employee manuals provide an avenue for informing employees about what they can do to stop workplace harassment. Additionally, employees should be notified of basic workplace rights such as those related to jury duty, military service and family and medical leave. Informing employees about their options when confronted with a potentially hostile environment will reduce the possibility of lawsuits and potentially limit monetary damage awards.
2. AVOID OVERTIME LAWSUITS
Conducting an audit to determine if your company is complying with federal pay laws could save you a boatload of cash.
One of the favorite sources of revenue for contingency-fee-chasing-lawyers is overtime lawsuits. If your company pays all employees by the hour, records all their time, and pays them time and a-half for hours worked in excess of forty every week, you have little to worry about. If you deviate from that preferred method, you need to make sure an exemption to the Fair Labor Standards Act applies.
FLSA suits can destroy small businesses.
Incorrectly paid employees can reach back three years for owed, but unpaid, overtime. Additionally, they can double the amount of overtime due as a penalty. The FLSA also provides for personal liability including criminal penalties for failure to comply with overtime and minimum wage requirements. Guessing wrong here is just not an option.
3. FIND OUT WHAT IS GOING ON
Targeted workforce audits can identify problems before they make headlines.
You can probably think of at least one company that recently terminated a high profile executive as a result of a sexual harassment allegation. Or perhaps you may have heard about an employee becoming so frustrated with his job that he cussed out customers and departed his worksite in dramatic fashion. Hiring a third party to enter your workplace and delicately discuss issues that will illicit information about "what is really going on" at your company can head off these disasters before CNN reports about them. Even where no specific concern exists but where a company wants to ensure that its workforce is comfortable with their jobs and their leadership team, it has proven beneficial time and again for companies to conduct workforce audits.
Be aware that non-attorneys who provide auditing services will not be able to protect their reports with the attorney-client privilege.
Due to the sensitive nature of the information obtained during workforce audits, limiting access to that information is often more important than obtaining it in the first place. While many non-attorneys provide workforce audits, identified by many different names and marketing tactics, they cannot provide the same level of information protection as attorneys.
Once the "horse has left the barn" and your company is defending against a lawsuit, is faced with a union drive, or is answering questions about a beer-stealing-customer-insulting-emergency-chute-sliding employee, it is not too late to protect your organization with the methods outlined above.
It just costs more.
Authored by: Paul Flannigan
Monday, January 31, 2011
Friday, October 8, 2010
TRADE SECRET PROTECTION
While operating under a well-drafted employee manual helps businesses save labor costs, implementing a comprehensive intellectual property protection plan for your company reduces risk by preventing thousands of dollars in litigation costs if your business’ intellectual property is misappropriated or infringed by current or former employees.
There are several methods of protection available, depending on the category of intellectual property that a business seeks to protect. A businesses’ intellectual property can be protected by copyright law, patent law, trademark law, or it could be considered a trade secret. Copyright law prevents copying of the specific expression of an idea; however, it does not protect against someone expressing the same idea in a different way. Trademarks protect a company’s brands of goods and services that are used in commerce. Patents protect certain types of ideas, such as new and innovative inventions.
A company should consult with an attorney in order to determine the best method of protection for its intellectual property, as there are pros and cons to each method. Copyright, trademark and patent law are all regulated under federal law and certain requirements must be met in order to receive protection. Whereas, trade secret law is typically regulated under state law, but it allows businesses to protect confidential or proprietary information, but only if the information is kept private.
Trade Secret law may offer the best protection for a business’ confidential and proprietary information
Even though an idea or invention may be able to be copyrighted or patented, a company may decide that it is in its best interest to treat the idea or invention as a trade secret. Under Texas law, a business may consider a broad range of types of information to be its trade secrets, so long as that information gives it an advantage over competitors who do not have that information, and so long as it accepts the obligation of taking measures to guard the information from release.
Trade secrets can be:
Computer Programs (including programmer’s notes)
Business Know-How
Specifications, Bill of Materials, Recipes, and the like
Processes (including flow charts)
Formulas (including algorithms)
Distribution Sources
Business Methodologies
Customer Information (lists and preferences)
Financial Information
Vendor/Supplier Lists (not publicly available)
Business and Marketing Plans
Product/Service Pricing
Personnel Information
Machinery (customized or unique to the company)
Five simple ways to prevent employee misappropriation of trade secrets:
The goal of trade secret law is to prevent competitors or former employees from using trade secrets that the company has sought to protect. By following a few simple steps, a company can protect the confidential or proprietary information that provides its competitive advantage in the industry.
Have a written policy and audit procedure in place that identifies the company’s specific proprietary or protected trade secrets and other intellectual property;
Implement a trade secret protection plan that segregates the trade secrets, including:
Labeling documents, items and software containing trade secrets
Using notice measures
Using physical security barriers
Upon hiring and periodically thereafter, educate employees about the company’s intellectual property;
Require employees with access to vital company information enter into written restrictive agreements with regards to confidentiality, non-solicitation, and non-competition; and
Conduct exit interview with departing personnel:
Review the terms of the nondisclosure agreement with departing personnel;
Remind employee/contractor of duty not to use or divulge company’s trade secrets;
Require that the employee sign a termination certificate, if possible, acknowledging employee’s/contractor’s understanding and duty not to disclose trade secrets or confidential information;
Obtain trade secret materials and documents in the employee’s possession or control, including, hard copies, diskettes (and other storage materials), home computer files, home office files, laptops, cell phones, etc.; and
Require that keys and access cards be returned.
Authored by: Catherine Hough
To read more firm publications click here
http://www.dallasbusinesslaw.com/CM/Custom/TOCFirm-Publication.asp
To learn more about our practice areas click here
http://www.dallasbusinesslaw.com/CM/Custom/TOCPracticeAreaDescriptions.asp
While operating under a well-drafted employee manual helps businesses save labor costs, implementing a comprehensive intellectual property protection plan for your company reduces risk by preventing thousands of dollars in litigation costs if your business’ intellectual property is misappropriated or infringed by current or former employees.
There are several methods of protection available, depending on the category of intellectual property that a business seeks to protect. A businesses’ intellectual property can be protected by copyright law, patent law, trademark law, or it could be considered a trade secret. Copyright law prevents copying of the specific expression of an idea; however, it does not protect against someone expressing the same idea in a different way. Trademarks protect a company’s brands of goods and services that are used in commerce. Patents protect certain types of ideas, such as new and innovative inventions.
A company should consult with an attorney in order to determine the best method of protection for its intellectual property, as there are pros and cons to each method. Copyright, trademark and patent law are all regulated under federal law and certain requirements must be met in order to receive protection. Whereas, trade secret law is typically regulated under state law, but it allows businesses to protect confidential or proprietary information, but only if the information is kept private.
Trade Secret law may offer the best protection for a business’ confidential and proprietary information
Even though an idea or invention may be able to be copyrighted or patented, a company may decide that it is in its best interest to treat the idea or invention as a trade secret. Under Texas law, a business may consider a broad range of types of information to be its trade secrets, so long as that information gives it an advantage over competitors who do not have that information, and so long as it accepts the obligation of taking measures to guard the information from release.
Trade secrets can be:
Computer Programs (including programmer’s notes)
Business Know-How
Specifications, Bill of Materials, Recipes, and the like
Processes (including flow charts)
Formulas (including algorithms)
Distribution Sources
Business Methodologies
Customer Information (lists and preferences)
Financial Information
Vendor/Supplier Lists (not publicly available)
Business and Marketing Plans
Product/Service Pricing
Personnel Information
Machinery (customized or unique to the company)
Five simple ways to prevent employee misappropriation of trade secrets:
The goal of trade secret law is to prevent competitors or former employees from using trade secrets that the company has sought to protect. By following a few simple steps, a company can protect the confidential or proprietary information that provides its competitive advantage in the industry.
Have a written policy and audit procedure in place that identifies the company’s specific proprietary or protected trade secrets and other intellectual property;
Implement a trade secret protection plan that segregates the trade secrets, including:
Labeling documents, items and software containing trade secrets
Using notice measures
Using physical security barriers
Upon hiring and periodically thereafter, educate employees about the company’s intellectual property;
Require employees with access to vital company information enter into written restrictive agreements with regards to confidentiality, non-solicitation, and non-competition; and
Conduct exit interview with departing personnel:
Review the terms of the nondisclosure agreement with departing personnel;
Remind employee/contractor of duty not to use or divulge company’s trade secrets;
Require that the employee sign a termination certificate, if possible, acknowledging employee’s/contractor’s understanding and duty not to disclose trade secrets or confidential information;
Obtain trade secret materials and documents in the employee’s possession or control, including, hard copies, diskettes (and other storage materials), home computer files, home office files, laptops, cell phones, etc.; and
Require that keys and access cards be returned.
Authored by: Catherine Hough
To read more firm publications click here
http://www.dallasbusinesslaw.com/CM/Custom/TOCFirm-Publication.asp
To learn more about our practice areas click here
http://www.dallasbusinesslaw.com/CM/Custom/TOCPracticeAreaDescriptions.asp
Monday, September 13, 2010
Non-Compete Agreement Basics
Non-compete agreements seek to limit a person’s ability to engage in a specific range of business activities as a result of employment or a business transaction. Earlier this summer, the Ferguson Law Group, P.C. experienced a sharp uptick in the number of clients involved in non-compete issues. Of course, non-compete disputes do not occur unless an employee is hired or a new business is started. It is our hope that this means that businesses are continuing to find ways to succeed even in this economy.
Non-compete disputes are becoming more commonplace as American businesses increasingly rely on confidential business information and practices to maintain a competitive edge. These disputes often involve complicated facts and the laws of each involved State must be considered.
Non-compete law seeks to find a balance between allowing individuals to secure employment in their areas of expertise while at the same time protecting the businesses that employ them from unfair competition. A person is generally considered to have engaged in unfair competition when he uses an employer’s confidential or trade secret information to directly compete against them.
Most States have their own take on how to perform this delicate balancing act. One exception is, not surprisingly, California. California declared non-competes to be invalid except in very limited circumstances. However, even in California, businesses are allowed to protect their trade secrets by means other than non-compete agreements.
Elements Of An Enforceable Non-Compete
In Texas, non-compete law starts with Section 15.50 of the Business and Commerce Code. Texas courts have struggled to interpret this statute for years. Combining court decisions and Section 15.50 we see that a non-compete agreement is enforceable if:
(1) It is ancillary to another enforceable agreement;
(2) The consideration provided in exchange for the promise not to compete gives rise to the need for the non-compete;
(3) The non-compete does not restrain activity more than is necessary to protect the employer; and
(4) The restraint is not unreasonable in terms of duration and geographic scope.
Employment
This somewhat difficult language plays out practically in two different scenarios. First, in the employee-employer context, the employer agrees to provide the employee with confidential information or specialized training. In return, the employee agrees not to disclose that information outside of the business. That is the first agreement. In conjunction with that agreement (think ancillary to) the employee agrees not to compete against the employer. The employer can then argue that the non-compete is necessary and enforceable because it provided the employee with confidential information.
Sale Of Business
The second scenario involves the sale of a business. The Seller agrees to sell her business to the Buyer. The Buyer agrees to pay the Seller for the business. Ancillary to that “otherwise enforceable agreement,” the Seller agrees not to compete against the Buyer’s newly purchased business. The Buyer’s need for the non-compete is born out of the purchase of the business. If the Seller sells her hair salon to the Buyer and then opens up a competing shop in the same strip mall, the Buyer did not get much for his money. In other words, the sale of the business gives rise to the need for the non-compete.
Drafting enforceable non-compete agreements is tricky but not impossible. Enforcing non-compete agreements involves many variables and is more of an art form than a standard courtroom procedure.
At the Ferguson Law Group, we strive to offer the options that work best for the client. Sometimes, solutions can be found that do not involve rushing to the courthouse. On the other hand, there are those instances where nothing short of a court order will suffice.
By Paul Flannigan
To find out more information about employment law click here http://www.dallasbusinesslaw.com/PracticeAreas/Employment-Law.asp
To view this article on our website, please click here
http://www.dallasbusinesslaw.com/CM/Firm-Publication/Non-Compete-Agreement-Basics.asp
Non-compete disputes are becoming more commonplace as American businesses increasingly rely on confidential business information and practices to maintain a competitive edge. These disputes often involve complicated facts and the laws of each involved State must be considered.
Non-compete law seeks to find a balance between allowing individuals to secure employment in their areas of expertise while at the same time protecting the businesses that employ them from unfair competition. A person is generally considered to have engaged in unfair competition when he uses an employer’s confidential or trade secret information to directly compete against them.
Most States have their own take on how to perform this delicate balancing act. One exception is, not surprisingly, California. California declared non-competes to be invalid except in very limited circumstances. However, even in California, businesses are allowed to protect their trade secrets by means other than non-compete agreements.
Elements Of An Enforceable Non-Compete
In Texas, non-compete law starts with Section 15.50 of the Business and Commerce Code. Texas courts have struggled to interpret this statute for years. Combining court decisions and Section 15.50 we see that a non-compete agreement is enforceable if:
(1) It is ancillary to another enforceable agreement;
(2) The consideration provided in exchange for the promise not to compete gives rise to the need for the non-compete;
(3) The non-compete does not restrain activity more than is necessary to protect the employer; and
(4) The restraint is not unreasonable in terms of duration and geographic scope.
Employment
This somewhat difficult language plays out practically in two different scenarios. First, in the employee-employer context, the employer agrees to provide the employee with confidential information or specialized training. In return, the employee agrees not to disclose that information outside of the business. That is the first agreement. In conjunction with that agreement (think ancillary to) the employee agrees not to compete against the employer. The employer can then argue that the non-compete is necessary and enforceable because it provided the employee with confidential information.
Sale Of Business
The second scenario involves the sale of a business. The Seller agrees to sell her business to the Buyer. The Buyer agrees to pay the Seller for the business. Ancillary to that “otherwise enforceable agreement,” the Seller agrees not to compete against the Buyer’s newly purchased business. The Buyer’s need for the non-compete is born out of the purchase of the business. If the Seller sells her hair salon to the Buyer and then opens up a competing shop in the same strip mall, the Buyer did not get much for his money. In other words, the sale of the business gives rise to the need for the non-compete.
Drafting enforceable non-compete agreements is tricky but not impossible. Enforcing non-compete agreements involves many variables and is more of an art form than a standard courtroom procedure.
At the Ferguson Law Group, we strive to offer the options that work best for the client. Sometimes, solutions can be found that do not involve rushing to the courthouse. On the other hand, there are those instances where nothing short of a court order will suffice.
By Paul Flannigan
To find out more information about employment law click here http://www.dallasbusinesslaw.com/PracticeAreas/Employment-Law.asp
To view this article on our website, please click here
http://www.dallasbusinesslaw.com/CM/Firm-Publication/Non-Compete-Agreement-Basics.asp
Monday, August 23, 2010
Health Care Reform's Impact on Employment Issues
The Patient Protection and Affordable Care Act ("PPACA") will impact every citizen in a variety of ways and challenge employers to meet its requirements. It remains to be seen whether the PPACA will survive the multiple lawsuits already filed against it and the elections coming this November. As currently written, however, beginning in 2014 the PPACA will require employers who employ as few as fifty employees to provide federally approved health insurance or pay a fine. While the PPACA imposes multiple health insurance changes affecting every citizen, this article highlights a few broad points every business should be aware of.
Among many other issues of concern to businesses, the PPACA will most likely lead to an increase in discrimination lawsuits. Unfounded discrimination claims are already a constant concern. Unfortunately, the PPACA creates a new protected class, the poor, who will sue employers at every opportunity when they are subject to adverse employment actions.
This problem has been created because Congress decided that certain employees should be more costly to employ than others. Employers will be required to pay increased fines for employees who elect to receive premium subsidies from the government. Whether a person qualifies to receive these subsidies will depend upon their income or family income, if applicable. This will result in circumstances where it becomes more costly to employ a person if their spouse loses his or her job, thus lowering their family income. Because this presents an obvious disincentive to hire such individiuals, the new law provides that taking an adverse employment action against them, because of their economic status, is unlawful discrimination. This results in an entirely new class of workers that can, and very likely will file discrimination claims based upon their individual or family income level.
As a result, employers are further encouraged to ensure that employment decisions are consistent. Consistency is no easy task and requires an evaluation of the many and varied relationships within each workplace. Congress' foray into health care has increased the need to maintain constant vigilance in this area...
To continue this article please click here http://www.dallasbusinesslaw.com/CM/Firm-Publication/Health-Care-Reforms-Impact-on-Employment-Issues.asp
To find more information about Employment Law, please click here http://www.dallasbusinesslaw.com/PracticeAreas/Employment-Law.asp
This article was written by L. Kyle Ferguson
Among many other issues of concern to businesses, the PPACA will most likely lead to an increase in discrimination lawsuits. Unfounded discrimination claims are already a constant concern. Unfortunately, the PPACA creates a new protected class, the poor, who will sue employers at every opportunity when they are subject to adverse employment actions.
This problem has been created because Congress decided that certain employees should be more costly to employ than others. Employers will be required to pay increased fines for employees who elect to receive premium subsidies from the government. Whether a person qualifies to receive these subsidies will depend upon their income or family income, if applicable. This will result in circumstances where it becomes more costly to employ a person if their spouse loses his or her job, thus lowering their family income. Because this presents an obvious disincentive to hire such individiuals, the new law provides that taking an adverse employment action against them, because of their economic status, is unlawful discrimination. This results in an entirely new class of workers that can, and very likely will file discrimination claims based upon their individual or family income level.
As a result, employers are further encouraged to ensure that employment decisions are consistent. Consistency is no easy task and requires an evaluation of the many and varied relationships within each workplace. Congress' foray into health care has increased the need to maintain constant vigilance in this area...
To continue this article please click here http://www.dallasbusinesslaw.com/CM/Firm-Publication/Health-Care-Reforms-Impact-on-Employment-Issues.asp
To find more information about Employment Law, please click here http://www.dallasbusinesslaw.com/PracticeAreas/Employment-Law.asp
This article was written by L. Kyle Ferguson
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