Source: https://custodelaw.com/author/custodelaw/page/3/
Timestamp: 2019-04-23 22:16:56+00:00

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So far Frank Custode has created 88 blog entries.
In general, a restrictive covenant agreement is an agreement between an employer and employee where the employee agrees not to engage in certain specified activities which may be competitive with the employer following the conclusion of the employment relationship. The most common type of restrictive covenant agreement is a non-compete agreement. On November 9, 2017, the New Jersey Senate introduced Senate Bill 3518, which would significantly limit the enforceability of restrictive covenant agreements in the State of New Jersey.
Here are some highlights of the bill. Under the bill, restrictive covenant agreements would not be enforceable against certain types of workers, such as an employee classified as nonexempt under the Fair Labor Standards Act, seasonal or temporary employees, an employee who is terminated without good cause or laid off by the action of an employer, independent contractors, or an employee whose period of service with the employer is less than one year. In addition, restrictive covenant agreements would have to meet ten strict requirements to be enforceable, including but not limited to, the following: if the agreement is entered into in connection with the commencement of employment, the employer must disclose the terms of the agreement in writing to the prospective employee, the agreement must be signed by the employer and the employee, and the agreement must expressly state that the employee has the right to consult with counsel prior to signing; the agreement may not be broader than necessary to protect the legitimate business interests of the employer; the agreement may restrict the employee from engaging in activities competitive with the employer for no more than 12 months following the date of termination of employment; the agreement must not contain a choice of law provision that would have the effect of avoiding the requirements of the bill if the employee is a resident of or employed in the State of New Jersey at the time of termination or has been for at least 30 days immediately preceding the employee’s termination of employment; and the agreement must not restrict an employee from providing service to a customer or client of the employer, if the employee does not initiate or solicit the customer or client.
In short, if enacted, this bill would be a game-changer for employees and employers. For employers, it would obviously be much harder to enforce restrictive covenant agreements. As for employees, they would have increased mobility following the termination of their employment given the bill’s stringent requirements.
If you have any questions regarding this bill or restrictive covenant agreements, please contact the Law Office of Frank A. Custode, LLC.
What Constitutes A “Good Faith” Reduction In Force Under The New Jersey Law Against Discrimination?
To establish a prima facie case under the New Jersey Law Against Discrimination, a plaintiff must demonstrate that (1) her or she is a member of a protected group; (2) he or she was performing the job at a level that met the employer’s legitimate expectations; (3) an adverse employment action was taken against the employee; and (4) the challenged decision took place under circumstances that give rise to unlawful discrimination. See Williams v. Pemberton Twp. Pub. Schools, 323 N.J. Super. 490, 502 (App. Div. 1999). If the employee establishes a prima facie case, the burden of production shifts to the employer to establish a legitimate non-discriminatory reason for the adverse employment action. See Bergen Commercial Bank v. Sissler, 157 N.J. 188, 210 (1999). If a non-discriminatory basis is shown, the plaintiff must establish, by a preponderance of the evidence, that the alleged justification is a pretext for discrimination. See Zive v. Stanley Roberts, Inc., 182 N.J. 436, 449 (2005). However, it is important to understand how New Jersey courts analyze the employer’s “legitimate non-discriminatory” explanation for the termination in the context of a reduction in force.
Indeed, among the factors that courts analyze when reviewing whether an employee’s termination is the result of a “good faith” reduction in force are as follows: (1) whether the business reasons for the reduction in force and the anticipated economic savings therefrom were adequately documented; (2) the number of employees or percentage of the company’s work force affected by the reduction in force; (3) the existence of adequately documented selection criteria and procedures for implementation of the reduction in force; (4) whether reduction in force decisions were made on the basis of objective job related criteria and procedures or by reference to the individuals occupying the affected positions; (5) whether reduction in force decisions were based on fair and objective performance evaluations of the affected employees; and (6) whether there was any consideration of alternatives to laying off employees to achieve the economic savings anticipated from the reduction in force, such as shortened work weeks or work days, temporary shutdowns, voluntary reverse seniority layoffs with partial-pay, work-sharing, reductions in authorized overtime, salary freezes or reductions, hiring freezes and/or early retirement incentive programs. See Leahey v. Singer Sewing, Co., 302 N.J Super. 68, 79-80 (Law Div. 1996).
Based on the foregoing, affected employees should consult with legal counsel if they are subject to a reduction in force. If you have any questions about reductions in force and/or claims under the New Jersey Law Against Discrimination, please contact the Law Office of Frank A. Custode, LLC.
In Dugan v. Best Buy Co., Inc. (decided on August 11, 2017), the Appellate Division held that an employee’s continued employment may not be sufficient to establish the employee’s assent to an employer’s arbitration policy. As set forth below, this decision has important ramifications for both employers and employees in the State of New Jersey.
Kevin Dugan served as Best Buy’s General Manager. Approximately six years after Mr. Dugan commenced employment, Best Buy introduced its employees to an arbitration policy via an eLearning program. Mr. Dugan clicked “I acknowledge” on the last screen of the program, but did not read the policy. Approximately three weeks later, Best Buy terminated Mr. Dugan’s employment. He then filed a lawsuit against Best Buy alleging age discrimination in violation of the New Jersey Law Against Discrimination. In response, Best Buy filed a motion to compel arbitration and dismiss Mr. Dugan’s lawsuit, which was granted by the trial court. Mr. Dugan then appealed to the Appellate Division, which reversed the trial court’s ruling and remanded the action back to the trial court.
From an employee’s perspective, this is a positive opinion because it gives employees further ammunition to argue arbitration policies unfairly erode and waive their right to a jury trial in employment law disputes. From an employer’s perspective, the opinion provides guidance and demonstrates the perils of rolling out unclear electronic arbitration policies to their employees.
If you have any questions about arbitration policies and/or the rights of employees under the New Jersey Law Against Discrimination, please contact the Law Office of Frank A. Custode, LLC.
In Hejda v. Bell Container Corporation, decided on May 9, 2017, the New Jersey Appellate Division held that a union member’s disability discrimination claim under the New Jersey Law Against Discrimination and retaliatory discharge claim under the Workers’ Compensation Law are not preempted under the federal National Labor Relations Act. As set forth below, this decision has important ramifications for union members who assert claims under the New Jersey Law Against Discrimination.
Brian Hejda, a member of Teamsters Local 813, was employed as a commercial truck driver by Bell Container Corporation. In August 2012, he suffered a workplace injury to his knee. Following physical therapy sessions, Mr. Hejda was cleared to return to “light duty” work, with certain restrictions. However, the company did not have any light duty positions available for him at the time. In late September 2012 and early October 2012, Mr. Hejda was cleared to return to work with the same restrictions. Later in October 2012 and November 2012, an orthopedic specialist recommended surgery, and cleared Mr. Hejda for “sedentary work” only, with no commercial driving. However, the company did not allow him to return to work in that capacity. As such, in November 2012, Mr. Hejda filed a workers’ compensation claim with the New Jersey Department of Labor and Workforce Development, Division of Workers’ Compensation.
Ultimately, in February 2013, another orthopedic specialist agreed that surgery was required, but cleared Mr. Hejda to return to work without any restrictions. The company, however, advised the union that Mr. Hejda could not return to work until he was recertified under a Department of Transportation Federal Motor Carrier Safety Regulation as “physically qualified to operate a commercial vehicle.” The union then filed a grievance on behalf of Mr. Hejda, claiming, among other things, that the company should return him to his commercial truck driver position immediately. In April 2013, Mr. Hejda’s family physician certified that he met the Department of Transportation requirements. Nonetheless, the union’s grievance was denied. In November 2013, Mr. Hejda submitted another certification from his family physician, again stating that he met the Department of Transportation requirements. In response, the company offered him a position as a “night switcher” rather a commercial truck driver.
Thus, Mr. Hejda filed a lawsuit against the company alleging disability discrimination under the New Jersey Law Against Discrimination and retaliation under the Workers’ Compensation Law. In response, the company filed a motion to dismiss the lawsuit, asserting that the claims were preempted under the National Labor Relations Act. The trial granted the motion. Mr. Hejda then appealed the trial court’s decision.
This is an important decision for employees who are union members. Now, the court has clarified that union members may proceed with state law discrimination claims without concern that their cases are subject to preemption under federal labor law. This removes a significant hurdle for union members and should lead to the filing of more state law discrimination cases by union workers.
If you have any questions about the New Jersey Law Against Discrimination and/or have suffered from workplace discrimination, retaliation or harassment, please contact the Law Office of Frank A. Custode, LLC.
In general, it is a good business practice for employers to present a severance agreement to departing employees when a company has a reduction-in-force or terminates an employee. At its core, a severance agreement is an agreement between an employer and the departing employee where the departing employee releases potential legal claims against the employer in exchange for receiving monetary benefits to which the employee would not otherwise be entitled.
The agreement is valuable to both an employer and an employee. From an employer’s perspective, obtaining a release of potential legal claims by the departing employee is the only vehicle that assures that the departing employee will not bring legal action against the employer regarding the employee’s separation of employment. From an employee’s perspective, severance allows the employee to obtain additional compensation while transitioning to new employment.
Typically, severance agreements include various core provisions. Among such provisions included in severance agreements are general release of claims language, non-disparagement language, confidentiality language, and choice of law/choice of forum provisions. Since severance agreements involve the waiver of important legal rights, it is a good practice for employees to consult with an attorney prior to signing such an agreement.
If you have any questions about severance agreements and/or have been presented with a severance agreement by your employer, please contact the Law Office of Frank A. Custode, LLC.

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