As many in-house counsel are painfully aware, litigating a dispute in court is generally time-consuming and expensive.  Further, given a losing party’s right to appeal an adverse verdict, and with all due respect to Yogi Berra, litigation ain’t even over when it’s over.  As a result, some companies choose to include arbitration clauses in their agreements, believing that this will greatly reduce the amount of time and expense their company will have to incur if a significant dispute arises that cannot be resolved.

While it usually is quicker and less expensive to arbitrate a dispute rather than to litigate in court, that is not always the case.  For example, while it only would cost $375 to file a $5 million claim for breach of contract in the Federal District Court, the fees for commencing commercial arbitration before the American Arbitration Association (“AAA”) are $14,600 – even if the case is extremely simple. (Fees under the AAA Commercial Rules are tied exclusively to the amount of damages being claimed.)… Keep reading

NOTE:  Some changes have occurred since this entry was originally posted.  Please see new post from April 18, 2012 for an update.

On April 30, 2012, a number of major changes to the National Labor Relations Act (NLRA) regulations will take effect and businesses, especially those that are not unionized, should take heed.  While many employers view the NLRA as a “traditional” labor law that is  not applicable to private, non-union entities,  almost all employers engaged in interstate commerce are subject to the NLRA. 

Two of these changes (effective April 30) are of particular note:

  1. Posting of Notices:  As of April 30, 2012, all employers must post the Notice of Employee Rights under the National Labor Relations Act (English).  For now, failure to comply with the posting requirement does not automatically result in an unfair labor practice, as the regulation was originally drafted, but it is likely that the National Labor Relations Board (NLRB)will draw an adverse inference from an employer’s failure to post.  The posters must be 11 x 17 inches in size and posted in English and any other language which at least 20% of the workforce speaks, if they are not proficient in
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Because the role of most in-house counsel goes well beyond that of providing legal advice, whether communications with in-house counsel are privileged is a much more nuanced issue than it is with respect to communications with outside counsel.

General Principles Applicable to all Claims of the Privilege

1.  Not all communications with attorneys are privileged; only communications for the purpose of obtaining legal advice are privileged.  Thus, even conversations between a CEO and his or her General Counsel about the most sensitive and confidential aspects of their business are subject to disclosure unless they are for the purpose of obtaining legal advice.… Keep reading

With the new year, Massachusetts employers must add “gender identity” to the list of classes entitled to protection from employment discrimination and retaliation.   What was touted as the “transgender rights” law in Massachusetts is, in fact, a “gender identity” law. 

The Massachusetts transgender rights law defines “gender identity” as:

[A] person’s gender-related identity, appearance or behavior, whether or not that gender-related identity, appearance or behavior is different from that traditionally associated with the person’s physiology or assigned sex at birth.

This law allows employees to establish a workplace gender identity by providing their employer with evidence including, but not limited to, medical history, care or treatment of the gender-related identity, consistent and uniform assertion of the gender-related identity, or “any other evidence that the gender-related identity is sincerely held, as part of a person’s core identity.”

Notwithstanding this new law, the Massachusetts Commission Against Discrimination has already found that transgender employees are protected under the Commonwealth’s existing sex and disability discrimination laws.  Thus, we have long counseled Massachusetts employers to treat transgendered employees as a protected class, and we do not anticipate that this legislation will change that fundamental advice. … Keep reading

Most employment claims can be avoided by simply being aware of what the law requires.  Here are three recurring issues which plaintiffs’ class action attorneys and government agencies are targeting across the country and which can be easily avoided by taking action now.

1.  Misclassification of Workers as Independent Contractors

The Internal Revenue Service (IRS) and US Department of Labor (US DOL) have been increasingly cracking down on independent contractor misclassification.  Last year, Massachusetts, along with several other states, signed a Memorandum of Understanding (MOU) with the IRS and  DOL, formally agreeing to cooperate in investigating independent contractor misclassifications.  If a violation occurs, the government agency investigating the matter is obligated to report it to the other state and federal agencies which may be affected by the misclassification, potentially opening up the company to an audit by the IRS or the US DOL.

Massachusetts has one of the toughest tests to be met in order to classify someone as an independent contractor, and the penalties for misclassifying vary with the legal requirement which was not met as a result of the misclassification.  For example, if a worker was not paid accrued wages or vacation time upon termination, the … Keep reading

While non-lawyers may not have heard of the term “spoliation,” most people intuitively know that destroying evidence related to an ongoing litigation is a bad thing to do.  Conversely, even many lawyers do not know the breadth of a company’s obligation to preserve evidence, particularly electronically stored information (which is quaintly referred to as “ESI”).  Further, knowing the basics of this obligation is critical because failing to preserve ESI can lead to monetary penalties, affirmative claims being dismissed and/or defenses being barred.

Perhaps the most common misconception about the obligation to preserve ESI is that a company runs no risk of punishment for having destroyed ESI pursuant to a document retention/destruction policy, as long as such policy (i) is objectively reasonable and (ii) was  implemented at a time when no litigation could have been anticipated.  Further, at first glance, Rule 37(e) of the Federal Rules of Civil Procedure would appear to support this notion:

Absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system.

While this rule seems simple enough, the … Keep reading