Nasir and Matt get into the story that may rethink your decision for terminating someone for having a headache (migraine). They also answer the question, "I want to hire an employee from a competitor but I think he may have signed a non-compete. What can I legally do to steal him?"
NASIR: Welcome to Legally Sound Smart Business.
This is Nasir Pasha.
MATT: This is Matt Staub.
NASIR: Welcome to our business legal podcast where we cover business in the news and also answer some of your business legal questions that you have graciously sent in to our podcast at email@example.com, including a question from someone we know that is in San Diego that… oh, wait.
MATT: That’s not today, though. Well, if they’re listening, they know we’ll address their question later in the week.
NASIR: Oh, that’s true. Yeah, they sent in a question – not by email, though – which I guess they can do. They can stop us and write a note and fold it and then hand it to us. That’s one way to do it.
MATT: Well, it wasn’t a note, but he or she just said, “Hey, I have a question for you,” and I said, “Okay.” They told me it and it was actually last week. It was actually, like, three weeks ago, I think – the last time I saw them.
NASIR: Three weeks ago?
MATT: And then, I said to them, “Hey, you know what? I’m going to actually use your question this week, if you’re fine with that. I’ll keep you anonymous,” and they said, “Yeah, that’s fine.” So, that wasn’t a great story.
NASIR: We should give a clue of who it is. Like, we should give a clue that it’s a male in San Diego.
MATT: Well, maybe. We’ll decide on how we want to handle it when we get to Friday.
NASIR: Okay, all right. Let’s just go to Friday now.
NASIR: So excited.
MATT: Well, we have something that’s less exciting I guess to talk about today. This deals with the FMLA which, for you those of you that don’t know, is the Family and Medical Leave Act.
Basically, what this story comes down to is you can make an FMLA claim and it typically deals with, I think probably one of the biggest issues of this is usually pregnancy leave or things like that
MATT: I mean, that’s usually when the FMLA gets brought up. But this deals with headaches and specifically migraine headaches.
So, I don’t think I’ve ever had a migraine headache so I don’t know how bad it is for people.
NASIR: Have you known anyone with migraines?
MATT: Well, that’s what I was going to say. I know people that have had issues with it and I guess, when they get the migraine headaches, they just can’t really do anything. But, like I said, in my shoes, it’s hard to figure out how bad it is because I don’t think I’ve ever had one.
NASIR: Yeah, I’ve only experienced it through other people as well, but I know someone that gets it probably – I’d have to ask them but I would estimate – maybe once a month. When he gets them, he literally shuts himself off from the world, turns off all the lights because, you know, it creates a huge amount of sensitivity to light – you know, you can get nauseous and so forth, depends on how severe it is – and takes the medicine or whatever and just kind of sits there the whole day until it goes away and there’s not much they can do besides that. You know, he’s tried a number of different things but I’m just trying to highlight that the Family Medical Leave Act does provide for medical leave only to certain conditions. Obviously, a mere headache is not enough but the Department of Labor has considered migraines as to be covered under FMLA as a covered medical condition.
MATT: Yeah, and that’s basically what this is despite the fact that the picture is of a dog with an icepack on its head. I thought migraines were only for dogs until you just informed me.
NASIR: Well, yeah, it’s for people, too. And FMLA doesn’t cover dogs, I don’t believe. We’ll have to check into that.
MATT: Yeah, we’ll look into that.
This is something for employers to think about because I can definitely see an abuse in this system as well because an employee that doesn’t want to work just might say, “Hey, I have a migraine headache and I can’t work and now you have to relieve me right now of working because it’s covered under this act,” but it’s something for employers to think about because they can’t just brush it aside like it’s nothing.
MATT: I think it’s probably people that are like you and I who’ve never experienced this so they don’t know how bad it is. I mean, if it’s really, like you say, for your friend, they basically have to shut off everything and just kind of be removed from the world then, yeah, what good are they going to do in the office at that point? Like, they’re not going to accomplish anything.
MATT: It’s probably only making it worse and, as long as they’re not happening every day, I mean, once a month is manageable in my opinion. If you hit a huge deadline and it’s right before that then it’s going to be worse but, for the most part, this is something that employers can accommodate. It’s pretty reasonable, I think.
NASIR: I think there’s also a stigma of migraines. I don’t know if stigma’s the right word but I think a lot of people that haven’t experienced it or known someone that has experienced it, there’s a lot of people who just don’t have much knowledge of it and so it almost seems fake, right? Because they compare it to a headache they may have had. Like, a migraine is not just a severe headache; it’s much, much more than that, from what I understand. So, it’s kind of hard to relate to unless you’ve actually seen someone that has one or had one yourself.
MATT: Yeah, and just to get on the specific instance, this one woman took a four-day leave of absence for migraine headaches and, as a result, was terminated from her position for taking this. So, it probably wasn’t the best decision on the employer’s part anyways but that’s kind of how this all came about.
NASIR: And we should talk about that. For small businesses that are listening to this that are thinking, “Okay, wait, now, as soon as one of my employees gets a migraine or gets some kind of medical condition, they can leave and I can’t terminate them?” Well, let’s just talk about how FMLA doesn’t apply to small employers because there are some subtleties to this rule. But, basically, this FMLA applies to employers of fifty or more employees and the employee also has to be there working I think for at least twelve months or a certain number of hours and so forth, and there’s also different variations as to how many employees per site and so forth. But, generally, we’re talking about large employers. If you have more than twenty-five, then it kind of depends upon whether the twenty-five employees are at the work site or not and so forth within the 75-mile radius, but that’s a little bit too much detail. But the point is that this is for larger employers that can probably afford to a certain extent an employee that’s absent for a little bit of time.
MATT: I mean, this was at Boeing so, obviously, they’re more than… I think they have more than twenty-five employees.
NASIR: I think so. I think they have twenty-six.
MATT: Yeah, twenty-six, just hired someone.
What’s interesting about this too is the woman that ultimately got terminated actually applied for FMLA leave and was just denied – you know, the supervisors, they knew about it. I thought that was interesting because she took the initiative and actually applied for this. Something that was – from what I can tell – relatively new or at least not really heard of under the FMLA. So, the fact that she did that – took the initiative to do it – and they still said, “We’re not only going to say no, we’re just going to fire you,” that’s a big issue.
MATT: Boeing definitely didn’t make it any easier on themselves by doing this.
But I think the takeaway for employers is, you know, just because it’s something they haven’t encountered in the past in terms of FMLA – like I said, it’s usually, you know, some sort of pregnancy leave, something like that – but you have to think about it – as long as they fit into the guidelines that you had of whether they have to abide by it.
NASIR: Yeah, and I want to specify that I mentioned twenty-five employees on a particular site but, overall, within a 75-minute radius, there should be at least fifty employees. The understanding is that, okay, well, if you have that many employees in one location, then you can afford to give up an employee if they have some kind of medical condition.
MATT: All right, well, Monday’s are usually a bit slow for us but I think this is actually a pretty solid story to start off the week.
NASIR: Nice, I think we should just stop here and give in for the week.
MATT: Not even get to the question?
NASIR: Not even get to Episode 80. We should just finish altogether.
MATT: This will be like Who Wants to Be a Millionaire?
So, we’ll read the question but we don’t have to answer it. We can choose to stop.
MATT: Is that how that game worked? I don’t even know if that’s even accurate. Did they get the question first and then they decided whether they want to answer it or do they have to say, “Yes, I’m moving on,” and then they got the question?
NASIR: Yeah, I think so – at least they should change it that way.
MATT: Well, I don’t think it’s on anymore.
NASIR: Well, I still watch the reruns every day.
MATT: Fair enough, all right. This comes from somebody in Los Angeles.
“I went to hire an employee from a competitor but I think he may have signed a non-compete. What can I legally do to steal him?”
That’s interestingly worded. I don’t know if “steal” is the right word.
NASIR: Yeah, how do you legally steal something? Well, don’t steal it. Oh, this is in Los Angeles, right? Or is LA for Louisiana?
MATT: Louisiana? Yeah, I’m pretty sure it’s Los Angeles. Well, we’re going to go with Los Angeles because I don’t know anything about Louisiana law.
NASIR: Yeah, they have a different set of laws over there, for sure. Actually, this is a common question, even amongst clients, because they’ll be recruiting somebody – whether it’s an upper-level employee or not – and they’ll actually be able to have to review their employee agreement because there’s a non-compete provision and also restrictions on trade secrets and so forth. So, if we bring them on, we don’t want to all of a sudden be exposed to liability as well and it’s really a case by case basis. But, generally, I think the only way to answer this is to actually view the non-compete, ask for a copy from the employee before you hire them. I’ve had even cases where the non-compete may have been enforceable but the employer negotiates with the former employer to basically buy out the employee. If the employee is such an asset, that’s pretty darn good for that person. Kudos to them.
MATT: You’re exactly right. I also think too that it’s going to depend on what exactly this person does or how integral they are to the operation of their current employer. You know, if it’s one of many minor employees that works there and you’re just trying to take them because they are very talented, that might be one thing. But, if it’s the second person in command of a company, it’s going to be a much bigger issue.
But, yeah, I think you’re right – view the non-compete if they have it and that’s going to tell you a lot right there.
NASIR: But this is also California, I forget. So, especially if it’s a California employee. But, even if it’s not, well, that’s a different issue, but especially if it’s a California employee, I mean, generally, non-competes are not enforceable. There are circumstances that they are so that’s not a blanket rule but it’s a very small scope when it comes to that in California.
I think the more interesting question is, if the employee is outside of California and is moving to California and is employed that way, courts are actually split on that and it’s kind of a race to the court, depending upon where the case is brought and which law they actually apply. We’ve had to deal with this and so forth so it’s not a very clear answer when it comes to that.
Bottom line is, if you really want the person, you’re going to have to hire an attorney. But, also, remember that this non-compete is between the employer and employee. Though there are some causes of actions like interference with contract and so forth, generally, you’re not bound by those kind of restrictions so keep that in mind as well.
MATT: You know, I’ve actually heard multiple CEOs for companies in California just flat out say, you know, “Good luck enforcing a non-compete in this state.” I mean, that’s just kind of the mentality that you’ll hear. Whether that’s true or not, that’s one thing. But I think that’s just the general mentality of business owners in California because they have seen that so many of them are unenforceable and I don’t think a lot of people even know that, really. It seems like it’s kind of still out there as a no-no.
NASIR: Oh, yeah, I see non-competes all the time. In fact, in California, there’s laws that not only that it’s not enforceable but there’s laws against it and the Department of Labor in California can actually enforce it and also institute fines against employers that do so even though it’s common because many other states do enforce employee non-competes to a certain extent. And so, I think people are so used to – if you look up online, “Are non-competes enforceable?” most often what you’ll see is that it’s enforceable if you restrict it by time, by place, and by certain restrictions. But then, you have to make sure you look it up by state too because people don’t realize that, in specific states, it’s just not enforced at all, against public policy.
MATT: Yeah, that’s a good answer. We could also use your answer from last week of when you gave advice to people on how to legally give negative reviews to your competitors.
NASIR: I know. I was listening to that and I was like, “Why did I say that?” Well, hopefully, only business owners are actually listening that are ethical.
MATT: I actually had a tweet constructed basically saying today’s episode co-host tells you how to legally get rid of your competitors but I decided against it.
NASIR: Yeah, I don’t want to encourage that behavior.
All right, well, I think we answered that question. Appreciate sending that in. Thank you so much.
MATT: Yeah, definitely.
NASIR: All right, have a good one!
MATT: Keep it sound and keep it smart.