For many Oregon employers, arbitration is preferred over litigation to resolve employment disputes. Arbitration can streamline dispute procedures and often proceeds more quickly than in court; it also can save the parties attorneys’ fees.

Arbitrators may also be more likely than jurors to apply the facts to the law without emotion or bias. Arbitration can keep a dispute private and prevent it being tried in the press. Depending on the facts (or allegations) of the dispute, this may be the key advantage to arbitration for an employer. Also, arbitration may more efficiently limit so-called “scorched earth” discovery in a manner that employers appreciate since they tend to have most of the employment-related records.

Lastly, arbitration decisions are usually final (aka “binding”), and can be appealed in very limited circumstances. Under binding arbitration, an employee unhappy with an arbitrator’s decision will not get a second bite at the apple before the appellate court; however, neither will an unsatisfied employer.

Oregon state and federal courts typically enforce employment arbitration agreements. Case in point: In August 2014, the United States District Court for the District of Oregon enforced an employer/employee arbitration agreement in Anderson v. Xerox Corp.

In the case, the employee filed a discrimination complaint against his employer, Xerox Corp. Thereafter, Xerox filed a motion to compel arbitration and dismiss the complaint. Xerox argued that when the employee had applied for employment in 2007, he had “electronically” initialed acceptance of Xerox’s Dispute Resolution Plan (DRP), and that Xerox had provided the employee with an amended version of the DRP that states: “Employment, consideration for employment, or continued employment, and other valuable consideration after the applicable Effective Date of the DRP constitute consideration and consent to be bound by the DRP, including its mandatory arbitration provisions, by the Applicant and/or Employee, on the one hand, and the Company, on the other hand, during and after the employment relationship.”

The employee argued he never agreed to arbitrate anything. The District Court disagreed with the employee, reasoning that because the employee did not dispute that he received the employer’s written materials that explained the DRP and its related arbitration provisions, and because the employee continued to work for the defendant, the employee “was aware of and accepted defendant’s employment term that all disputes concerning his employment must be resolved via arbitration.”

The court not only enforced the arbitration agreement, but also dismissed the employee’s complaint. This was obviously a very good result for the employer.

Oregon employers who want to take advantage of the benefits of arbitration should keep the following information in mind: 1, ORS 36.620 provides that an employment arbitration agreement is not enforceable unless it is provided to the employee at least 72 hours before the first day of employment (or upon a bona fide advancement) and the employee signs an acknowledgement containing the language set out in the statute; 2, Draft the arbitration agreement so that it will be clear to any court that reviews it that employees knowingly waived their right to a jury trial; 3, Expressly state that employees have the right at arbitration to be represented by counsel; 4, Include a process for permitting reasonable discovery, such as the exchange of documents and depositions, at arbitration; 5, Give employees the chance to equally participate in selection of an arbitrator; 6, Agree that the employer will pay arbitration costs that would be greater than the employee would have to pay in court, such as arbitrator fees; 7, Agree that employees who agree to arbitrate their disputes will have the same potential remedies that would be available in court under the applicable law; and 8, Make sure the agreement to arbitrate is not lopsided in favor of the employer.

The extra care needed to ensure that an arbitration agreement is enforceable is well worth the effort.

Jeff Brecht is an attorney with Portland law firm Sussman Shank LLP and a member of its litigation and labor and employment law groups. Contact him at 503-243-1652 or jbrecht@sussmanshank.com.

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Effective Jan. 1, 2014, Oregon employers will be subject to a new social media-related employment law. House Bill 2654 prohibits employers from requesting an employee’s or applicant’s social media username or password, requiring an employee or applicant to add the employer to his or her social media contacts, compelling an employee or applicant to access a personal social media account in front of the employer, or retaliating against an employee or applicant for refusing to do these things.

The new law defines “social media” broadly to include “an electronic medium that allows users to create, share and view user-generated content, including, but not limited to, uploading or downloading videos, still photographs, blogs, video blogs, podcasts, instant messages, electronic mail or Internet website profiles or locations.” In other words, social media includes at least all of the usual suspects: Facebook, YouTube, Twitter, Instagram, LinkedIn and so on.

Under the new law, employers may access an employee’s or applicant’s social media page to ensure “compliance with applicable laws, regulatory requirements or prohibitions against work-related employee misconduct based on receipt by the employer of specific information about activity of the employee on a personal online account or service.” The new law also clarifies that an employer is not liable for inadvertently obtaining an employee’s private social media passwords as long as it does use the information to “access the personal social media account of the employee.”

Notwithstanding the prohibitions under House Bill 2654, Oregon employers should inform employees what kinds of work-related information they may (and may not) publish on personal websites, blogs, wikis, social networks, online forums, virtual worlds, or any other kind of social media (such as Twitter). At a minimum, an employee handbook should notify employees that they:

• Must state in clear terms that the views expressed on any social media network are the employee’s alone and that they do not necessarily reflect the views of the employer;

• Are prohibited from disclosing information on any social media network that is confidential or proprietary to the employer or to a third party that has disclosed information to the employer;

• May not make statements about the employer, co-workers, clients, competitors, or any other person or entity that are harassing, threatening, libelous, or defamatory;

• Cannot act as a spokesperson for the employer, post comments as a representative of the employer, or provide job references or endorsements on behalf of the employer for any person or product;

• May not use social media to harass, discriminate or create a hostile work environment.

However, employers should remain mindful that this area of law is evolving. The National Labor Relations Board has repeatedly decided that employer social media policies that are too restrictive may violate Section 8(a)(1) of the National Labor Relations Act, which generally prohibits employers from interfering with, or restraining, employees’ rights to engage in “concerted activities.”

Concerted activities are those in which two or more employees act together in furtherance of matters of mutual interest, such as employee compensation, benefits or improving workplace conditions. With respect to social media, a concerted activity can include employees communicating on Facebook about their pay or working conditions.

Employers should therefore avoid implementing a social media policy that prohibits employees from discussing work or disparaging the employer, or otherwise leads them to reasonably believe they are restricted from engaging in concerted activities. Most recently, the Fourth Circuit Court of Appeals ruled that “liking” something on Facebook is a form of speech protected by the First Amendment.

All of this means that Oregon employers need to engage in a balancing act between adopting and enforcing a social media policy that both protects their business and protects their applicants’ and employees’ rights.

Jeff Brecht is an attorney with Portland law firm Sussman Shank LLP and a member of its litigation and labor and employment law groups. Contact him at 503-243-1652 or jbrecht@sussmanshank.com.

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Employers generally are aware of potential advantages of binding arbitration of employment disputes. Arbitrators, for instance, are considered less likely than jurors to be influenced by an employee’s appeal to emotional considerations.

Arbitration also can be significantly faster than litigation through a court. Whereas court litigation commonly lasts longer than a year, and sometimes many years, arbitration is usually completed within a number of months. Arbitration’s speedier process usually also results in less protracted discovery, which often translates into less expense than court litigation.

Additionally, because arbitration documents are generally not “filed” as they are in court litigation, the arbitration process is usually more private, which can be a boon to employers that do not wish the employee’s unproven (and often unfounded) allegations made available to the public.

Finally, “binding” arbitration typically means an arbitrator’s decision cannot be appealed.

Unfortunately, since 2008, Oregon employers that want new employees to be covered by binding arbitration agreements encounter a frustrating speed bump. The law requires employers to give the employees a written employment offer explaining that an arbitration agreement is a condition of employment – and the offer/notice must be given at least two weeks before the first day of employment.

Employers and employees who need the employment to start ASAP find the two-week waiting period exasperating. Thankfully, effective Jan. 1, 2012, the two week waiting period will be reduced to just three days.

Oregon Gov. John Kitzhaber has signed into law HB 3450, which amends the statute that governs the validity of agreements to arbitrate between employers and employees – ORS 36.620(5)(a).

Under the amended law, a written arbitration agreement between an employer and employee will be valid only if at least 72 hours before the first day of the employee’s employment, the employee has received and signs a written notice that includes the following language, in boldface type:

“I acknowledge that I have received and read or have had the opportunity to read this arbitration agreement. I understand that this arbitration agreement requires that disputes that involve the matters subject to the agreement be submitted to mediation or arbitration pursuant to the arbitration agreement rather than to a judge and jury in court.”

The amendment will not change the requirements to enter into valid arbitration agreements with current employees. Such agreements are valid only if they are “entered into upon a subsequent bona fide advancement of the employee by the employer.”

Finally, employers should keep in mind that the enforceability of employment-related arbitration agreements is a common issue in published court decisions. Employers that wish to require employees to be subject to arbitration agreements should regularly confer with their attorneys to make sure the arbitration agreements are binding, enforceable and up to date.

Jeff Brecht is an attorney with the Portland law firm of Sussman Shank LLP and a member of its litigation and labor and employment law groups. Contact him at 503-243-1652 or jeffb@sussmanshank.com.

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Each company works hard to develop a loyal client base. Let’s assume a company has also entered into valid and enforceable non-competition agreements with its employees. In Oregon, such agreements are “voidable” unless they comply with the statutory requirements set out in ORS 653.295.

What should a company do if it learns that a former employee is soliciting its clients within a geographic area forbidden by the agreement? The steps are fairly straightforward.

The first thing the company should do is conduct an investigation to pin down as many facts as possible about the former employee’s conduct. The company will want to learn who, what, where and when the former employee solicited, and many other facts about the solicitations.

Oftentimes, employers will first learn of the solicitation when a client forwards to the employer a solicitation email the client has received from the former employee. As part of its investigation, the company will want to request copies of any written solicitations. It will also want to identify persons who witnessed the solicitations.

The next step is to request that the company’s attorney analyze the facts from the investigation and prepare and send the former employee a cease and desist letter. Such letters generally include a summary of the facts, a copy of the non-competition agreement signed by the former employee, and a demand that the employee immediately cease the solicitations and comply with the agreement.

The letter also should explain that if the ex-employee does not comply, the company will enforce the agreement in court and seek money damages and all other available remedies (which could include an award of attorney fees under the non-competition agreement).

Finally, if the former employee fails to comply with the demand, the company will need to seek assistance from a court. This will likely require it to retain an attorney to prepare, file and prosecute a complaint.

Because litigation frequently is a slow process, the company may also need to seek a temporary restraining order or preliminary injunction to require the former employee to immediately stop soliciting its clients, even if the lawsuit has just begun.

In order to qualify for a temporary restraining order or preliminary injunction, a company must generally show that the employer will probably win the case at trial, it will suffer irreparable harm if an injunction is not entered, the relief is fair under the circumstances, and the order is in the public interest.

Such orders are within the sound discretion of the court, which will balance these factors in order to determine whether an injunction is appropriate. If the court orders a temporary restraint, it will likely later conduct a hearing during which the former employee may attempt to “show cause” why the restraint should not continue throughout the litigation.

A valid non-competition agreement can be one of an employer’s most important tools to protect its business and client base. But such an agreement is only as powerful as the employer’s willingness to enforce it. Accordingly, employers that use non-competition agreements should become familiar with the preceding process and be prepared to enforce its rights.

Jeff Brecht is an attorney with the Portland law firm of Sussman Shank LLP and a member of its litigation and labor and employment law groups. Contact him at 503-227-1111 or jeffb@sussmanshank.com.

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George Orwell might have been pleased to learn that 60 years after his novel “1984” was published, a new federal law was enacted to protect employees from misuse of their genetic information. On Nov. 21, 2009, the Genetic Information Nondiscrimination Act went into effect.

GINA makes it unlawful for a covered employer to “fail or refuse to hire, or to discharge, any employee, or otherwise to discriminate against any employee with respect to the compensation, terms, conditions or privileges of employment of the employee, because of genetic information.” Covered entities in possession of applicants’ or employees’ genetic information must keep it confidential.

GINA applies to all entities covered under Title VII of the Civil Rights Act, including employers with 15 or more employees, employment agencies, labor organization, and certain federal employers.

GINA broadly defines genetic information as information about the genetic tests of: 1, an individual; 2, an individual’s family members; 3, any fetus of an individual or family member who is a pregnant woman, and such tests of any embryo legally held by an individual or family member utilizing reproductive technology. Genetic information also includes the manifestation of a disease or disorder in an individual’s family members. Finally, genetic information includes any request for, or receipt of, genetic services or participation in research that includes genetic services by an individual or an individual’s family members. Genetic information does not include information about the sex or age of any individual.

A genetic test under GINA does not include routine tests such as cholesterol tests and liver enzyme tests, and it also does not include tests for alcohol or drug use. Instead, under GINA a genetic test is one that analyzes human DNA, RNA, chromosomes, proteins or metabolites that detect genotypes, mutations or chromosomal changes.

Under GINA, then, if an employer learns that an employee’s family medical history suggests that promoting the employee to a more stressful position might cause the employee to suffer heart problems, the employer’s consideration of that information in deciding whether to promote the employee implicates GINA.

Employers that violate GINA may be liable for monetary and emotional distress damages, including punitive damages, and attorneys’ fees and costs. Aggrieved employees also may be awarded reinstatement, hiring, promotion and injunctive relief.

Entities covered by GINA should immediately train management and human resources personnel on GINA, and update their policies and procedures to comply with GINA. Covered employers also should display an updated workplace poster that includes GINA information. A supplemental workplace poster that outlines GINA is available on the U.S. Equal Employment Opportunity Commission’s Web site.

Jeff Brecht is an attorney with the Portland law firm of Sussman Shank LLP and is a member of its litigation and labor and employment law groups. Contact him at 503-227-1111 or jeffb@sussmanshank.com.

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As an incentive to encourage attorneys to represent employees/plaintiffs, Oregon’s statutes generally require the court to award a prevailing plaintiff/ employee reasonable attorney fees incurred in prosecuting claims against employers.

Some statutes limit the possibility of an award of attorney fees solely to the plaintiff/ employee. See ORS 652.200: The court “shall” award attorney fees to a prevailing plaintiff/employee.

Other statutes, theoretically, permit an award of attorneys fees to a prevailing defendant/ employer. See ORS 652.230: The court “may” award reasonable attorney fees incurred by a prevailing defendant/employer but only “if the court determines that the plaintiff had no objectively reasonable basis for asserting a claim.” The harsh reality is that prevailing employers never obtain an attorney fee award.

Well, make that almost never.

In Rogers v. RGIS LLP earlier this year, the Court of Appeals upheld an attorney fee award to a prevailing employer. The employee in the case brought claims against her former employer for alleged unpaid overtime wages, unpaid wages for rest and meal breaks, unpaid minimum wages, and late payment of final wages. At trial, the employee prevailed only on her claims for unpaid wages and the late payment of those wages, and she obtained a judgment of $2,630. The court awarded only $880 in attorney fees to the plaintiff (approximately one-third of the plaintiff’s damages) under ORS 652.200.

The employer successfully defended the employee’s other claims, for unpaid overtime, rest and meal breaks, and minimum wages under ORS 653. The employer then sought attorney fees as the prevailing party, pursuant to ORS 653.055(4), which states: “The court may award reasonable attorney fees to the prevailing party in any action brought by an employee under this section.” The court found that the employer had “prevailed on all ORS chapter 653 claims” and awarded $180,854.09 in attorney fees.

The plaintiff appealed, arguing she had “prevailed” in the case, so the employer was not entitled to fees. The Court of Appeals disagreed, holding that under ORS 20.077, “attorney fees are to be awarded on a claim-by-claim basis.” Because the employee brought multiple statutory claims, and those statutory claims provided for attorney fees to the prevailing party, the trial court properly determined the prevailing party on each separate claim.

So, what can employers learn from this case? Employers should not count on the trial court to award any discretionary attorney fees when defending against employee claims. But employers also should not abandon all hope.

Jeff Brecht is an attorney with the Portland law firm of Sussman Shank LLP and is a member of its litigation and labor and employment law groups. Contact him at 503-227-1111 or jeffb@sussmanshank.com.

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