In an effort to keep our newsletter readers abreast of recent developments and legal trends, we are continuing our \u201ctop five to ten\u201d list of cases of importance to executives and professionals.\u00a0 This time, we are covering cases addressing the following topics: (1) the enforceability of an employer\u2019s choice of law and forum provision in a restrictive covenant agreement; (2) how Massachusetts\u2019s status as a \u201cpretext only jurisdiction\u201d is increasing the number of trials in discrimination cases; and (3) how the terms of a written employment agreement may reduce the viability of ultra-contractual claims.<\/p>\n
Also included in our list you will find our \u201cHeads Up\u201d regarding: (4) a constitutional challenge to the restriction on an employer\u2019s right to ask a job candidate about her (or his) salary history; and (5) a case pending at the Massachusetts Supreme Judicial Court regarding, among other things, whether racially \u201cseparate but equal\u201d work units are lawful \u2013 we expect the answer to be \u201cno.\u201d\u00a0 Click here to learn more.<\/p>\n
RESTRICTIVE COVENANTS \u2013 AN EMPLOYER\u2019S CHOICE OF LAW AND FORUM MAY NOT BE HONORED <\/strong><\/p>\n Mr. Hernandez was employed in California by Oxford Global Resources (Oxford), a company headquartered in Massachusetts.\u00a0 As a condition of employment, he signed a confidentiality, non -solicitation and non-competition agreement (the Agreement).\u00a0 The Agreement stated that it would be governed by Massachusetts law and that all lawsuits arising from the Agreement would be brought in Massachusetts courts.\u00a0 After Mr. Hernandez left to work for a competitor in California, and allegedly violated the Agreement, Oxford filed suit against him in Massachusetts \u2013 but that suit was dismissed on the grounds of forum non conveniens.\u00a0 Oxford appealed, and the Massachusetts Supreme Judicial Court (the Court) took jurisdiction.<\/p>\n The Court held that Oxford\u2019s choice of law provision was unenforceable where California substantive law would apply under the Massachusetts choice of law principles and where the application of Massachusetts substantive law would violate the fundamental public policy of California favoring open competition and employee mobility.<\/p>\n The Court also held that the dismissal on the ground of forum non conveniens was not an abuse of discretion.\u00a0 While recognizing that the judicial forum agreed to by the parties was Massachusetts, the Court agreed with the lower court that both private and public concerns had to be considered.\u00a0 The Court held, among other things, that California\u2019s public policy to protect its residents was such that the action should be resolved in a California court.<\/p>\n DISCRIMINATION LAW \u2013 EXPECT MORE TRIALS IN MASSACHUSETTS, A \u201cPRETEXT ONLY JURISDICTION\u201d<\/strong><\/p>\n After the City of Boston declined to renew Ms. Scarlett\u2019s teaching contract, she filed suit for, among other things, race discrimination.\u00a0 Before the case could come to trial, the lower court issued summary judgment in the employer\u2019s favor.\u00a0 Ms. Scarlett appealed.\u00a0 Based on precedent from the Supreme Judicial Court, Massachusetts\u2019s highest court, establishing Massachusetts as a \u201cpretext only jurisdiction\u201d, the Appeals Court reversed the lower court\u2019s ruling as to the race discrimination claim \u2013 allowing the case to proceed to trial.<\/p>\n In so holding, the Appeals Court reiterated that, in Massachusetts, an employer seeking to avoid trial \u201cfaces a high burden\u201d because \u201cthe question of the employer\u2019s state of mind (discriminatory motive) is elusive\u201d and rarely is established other than by circumstantial evidence, making pre-trial dispositions \u201cdisfavored.\u201d\u00a0 Here, Ms. Scarlett demonstrated that one of the many reasons given by the City for her non-renewal was false and therefore could not be the real reason, i.e., that such reason was \u201ca pretext\u201d for the non-renewal.\u00a0 From that alone, \u201ca jury could infer that the remaining rationales proffered were also false.\u201d\u00a0 Because Massachusetts is a \u201cpretext only jurisdiction,\u201d that was enough for Ms. Scarlett to have her case heard by a jury.<\/p>\n CONTRACT LAW \u2013 WHEN THE TERMS OF AN EMPLOYMENT CONTRACT TRUMP OTHER CLAIMS<\/strong><\/p>\n Mr. Biewald, an at-will salesperson, had a contract under which he had the right to earn commissions at a certain level.\u00a0 He employer terminated the contract, diminished the commission entitlement, and eventually terminated his employment when the parties could not come to an agreement on a new commission plan.\u00a0\u00a0Mr. Biewald pursued several claims, including for breach of the covenant of good faith and fair dealing and for retaliatory termination under the Wage Act. Before trial, the lower court entered summary judgment on these claims on behalf of the employer, which judgment was affirmed on appeal.\u00a0 The Appeals Court held that, under the circumstances of this case, the employer\u2019s contractually authorized diminishment of the commission entitlement did not breach the covenant of good faith and fair dealing and, as to the termination, the employer did not have to keep Mr. Biewald employed indefinitely when terms for a new agreement could not be reached.<\/p>\n WAGE ACT \u2013 IS THE PROHIBITION AGAINST ASKING ABOUT WAGE HISTORY CONSTITUTIONAL? <\/strong><\/p>\n DISCRIMINATION LAW \u2013 IS \u201cSEPARATE BUT EQUAL\u201d LAWFUL IN THE WORKPLACE?<\/strong><\/p>\n In an effort to keep our newsletter readers abreast of recent developments and legal trends, we are continuing our \u201ctop five to ten\u201d list of cases of importance to executives and professionals.\u00a0 This time, we are covering cases addressing the following topics: (1) the enforceability of an employer\u2019s choice of law and forum provision in […]<\/p>\n","protected":false},"author":9,"featured_media":137,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":"","_links_to":"","_links_to_target":""},"categories":[],"tags":[],"class_list":["post-156","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"acf":[],"yoast_head":"\n\n
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