Tag: business contracts

Can a Business Steal Your Employee?

Employers invest a tremendous amount of time, money, and other resources into recruiting and training their employees. A competitor targeting your qualified employees could cause harm to your business. This raises an important question: Can another business poach your employees? In California, the answer is “it depends”—poaching employees is generally lawful, but there are limits on what another employer can do. In this article, our Fremont business lawyer highlights the key things to know about another company’s ability to steal your employees in California.

Background: California is an At-Will Employment State

As a starting point, it is important to emphasize that California is an at-will employment jurisdiction. The National Conference of State Legislatures (NCSL) explains that at-will employment is a doctrine whereby either—employer or employee—has the right to end the relationship at any time and for any reason, except for an illegal reason. In other words, in the absence of an employment contract, an individual employee is free to leave your company.

Employee Non-Compete Agreements are Unenforceable in California

Some states allow employees to get their employees to sign non-compete agreements that, at least temporarily, prevent them from working for a direct competitor. Employee non-compete agreements are not enforceable in California. However, non-solicitation agreements may be upheld.

Businesses in California Have Rights and Options for Protecting their Interests

Simply put, California law protects an employee’s right to leave their employer for a competitor. It also protects the right of a business to try to recruit qualified employees—including those actively employed at competing businesses. Poaching of employees is generally lawful in California. However, there are some limitations that prevent competitors from “stealing” your employees. Here are some of the key things that employers in California should understand about their rights and options for keeping competing businesses from poaching their employees:

  • Employees Owe a Basic Duty of Loyalty: A worker who is actively employed at your company owes it a basic duty of loyalty. An employee could announce that they are leaving to join a competing company, but they generally cannot actively solicit their co-workers to join them while still in your employ.
  • Employment Agreements May Offer Protection: One strategy that businesses can use to protect their staff from poaching is an employment agreement. An employee who signs a valid and well-tailored employment agreement could face a breach of contract claim if they do not abide by the terms—such as if they leave for a competitor before the contract ends. Though, it is important to emphasize that non-compete clauses cannot be included in an employment agreement in California.  However, the competitor may be liable for interfering with that employment contract.
  • California Law Prohibits “Workforce Raids”: While general “poaching” of employees is not barred in California, there are some restrictions on “raids.” In effect, the law prohibits competitors from using bad faith practices to intentionally solicit a large number of your employees to damage your business. If your employees are “raided” by a competitor, you could have a tortious interference claim under California law. Generally, an employment contract is required to successfully pursue this type of claim.

How Businesses Can Protect Confidential Information When Employees Leave 

While businesses in California have limited options to prevent their employees from leaving to take a position at a competing company, employers do have options for protecting their confidential information. A properly drafted and well-tailored non-disclosure agreement that protects proprietary business information, including trade secrets, may be enforceable in California.

Contact Our Fremont, CA Business Law Attorney Today

Lynnette Ariathurai is an experienced, solutions-driven business lawyer. If you have any questions about another company stealing your employees, we are here to help. Contact us today for a strictly confidential consultation. We provide business law representation throughout the Bay Area.

business contracts, Business Formation & Planning, Contracts

Business Attorney for Doctors, Nurses and Medical Personnel

business lawyer for medical personnel

Building, growing, and managing a successful business is complicated — particularly for doctors, medical specialists, and other health care providers who must navigate some unique regulatory and logistical challenges. Attorney Lynette Ariathurai is a skilled business law advocate with extensive experience representing physicians and other health professionals. For a confidential consultation with a California business lawyer for medical professionals, please call our Fremont office at 510-794-9290 or send us a message online.

We Provide Business Services for Doctors and Medical Professionals in the Bay Area

Business Formation

We help health industry professionals and entrepreneurs form businesses under California law. The state’s Moscone-Knox Professional Corporation Act imposes significant restrictions on the ownership and control of many companies in the medical industry. Our firm will help you and your partners form a professional corporation that provides strong liability protection. We also advise health practitioners and entrepreneurs with buying and selling businesses and organizations. 

Regulatory Compliance

Professional corporations in the health care industry must navigate complex regulatory compliance issues, including things like the Stark Law, federal anti-kickback statutes, and California state rules. Our founding business attorney Lynette Ariathurai has the knowledge and legal skill to help you understand your obligations.

Professional Licensure Issues

Business attorney Lynette Ariathurai helps physicians and other health professionals navigate the full spectrum of professional licensing issues. If you are a doctor, a nurse, a dentist, an optometrist, or any other health industry business owner with questions about a professional license, we are here to provide guidance.

Contract Review and Negotiation

Contracts are at the foundation of most commercial relationships. Our business lawyer for medical practitioners provides representation on business contracts. If you have any questions or concerns about the drafting, review, or negotiation of business contracts, we are more than happy to help.

Employment Law

Many professional medical corporations in California have employees. Lynette Ariathurai provides a full range of employment law services for employers. Our focus is on helping you and your business partners put the proper structure in place to prevent claims, including employee handbooks, employment law agreements, and advising employers on wage & hour laws, worker discipline and termination.

Dispute Resolution

Disputes happen. If you are involved in a dispute with a patient, an employee, a vendor/supplier, a competing firm, or any other party, it is crucial that you take immediate action. With experience in mediation, arbitration, and litigation, our Fremont, CA business law firm will protect your rights and help your professional practice find the best path forward.

Get Help from Our California Business Lawyer for Medical Professionals

Attorney Lynette Ariathurai is committed to protecting the rights and interests of clients. We provide reliable, solutions-driven business representation to physicians and other medical personnel. Contact our law firm now to schedule a confidential appointment with a skilled attorney. From our Fremont office, we provide business services to doctors, nurses, and medical professionals throughout the region, including those in Newark, Hayward, East Bay, Milpitas, Union City, San Leandro, Gilroy, San Jose, and Santa Clara.

business contracts, healthcare practice, licensure, Moscone-Knox Professional Corporation Act

Top 5 Business Contracts Mistakes

business lawyer

Contracts and contract reviews are part of everyday life for Bay Area businesses.  However, many business owners and managers make mistakes when creating, considering or approving a business contract that can have catastrophic ramifications on your business.  Here are five common mistakes in business contracts and how to avoid them.

1.   Using Internet or Ready-Made Contract Forms

There are several reasons a ready-made contract form will not work for you and your business. They include:

  • Contracts must be relevant in your locality. A form contract from Michigan may not contain clauses that are standard in California contracts.
  • State laws are varied. The law could be different from where and when the contract was originally drafted. You must review borrowed language from such a contract for amendments to relevant state law, including additions and subtractions to the various codes at play in the agreement.
  • Contracts are drafted from the perspective of one side over the other; is the form contract you are reviewing beneficial or detrimental to your deal?
  • Contracts for one type of entity may not be relevant for other types of entities

2.   Seeking Legal Advice After Signing the Contract

Even if your deal is relying on a generic contract template you pulled from the Internet, have a business contract lawyer review it before you sign it to make sure it protects you and includes all of the terms it should and does not put your business at risk.

3.   Forgetting the Recitals

A recital, in legal terms, is a preamble to the contract. It provides a general idea to the reader about who the parties are, what the contract is about, and why the parties are signing the contract. Often overlooked during the contract drafting and negotiation phases, when a dispute arises over contractual interpretation, the court or arbitrator may use the recitals as an aid to interpretation of the contract. Focus on the operative provisions of the commercial contract, but do not forget to set the scene and provide the reader of the contract with background information.

4.   Not Knowing Which Clauses to Include and Which to Leave Out

Not understanding boilerplate (standard contract clauses) can come back to bite you when a dispute arises. A business lawyer provides advice as to which clauses should be included in your contract and which clauses should not.

For example, an assignment clause should be included in a commercial contract. An assignment clause will permit you to assign the contract to another entity (someone who buys your business). Without an assignment clause, the contract may not be sold or transferred should you sell your business after the commercial contract is signed.

Another issue that can be addressed by a business attorney is whether a contract should include an arbitration clause.  The arbitration clause must also contain information about the impact of any decision by an arbitrator.  With no or weak arbitration clause included, the statement may be advisory and not enforceable.

5.   Forgetting That Words Have Meaning

Form contracts are notorious for containing vague and ambiguous language. Using words without clear definitions is dangerous to contracting parties because it places the interpretation of such language in the hands of someone else. Ambiguities are normally construed against the drafter of the contract. It is possible then that ambiguous language will have at least three interpretations – yours, the other party’s, and the court or arbitrator’s. A court or arbitrator may be bound to interpret such a clause using the custom and practice of your locality, which can be different from the custom and practice of your industry and even your intent at contract formation.

Ask Us to Review Your Business Contract

Make sure that your commercial contract is in writing and reviewed by an experienced and knowledgeable business contract attorney who can provide you with actionable advice and counsel to protect your business.

Avoid these and other common business contracts mistakes. Contact us now about reviewing your commercial contract before you sign it. We represent and counsel clients in Fremont, CA and the surrounding communities of Newark, Hayward, East Bay, Milpitas, Union City, San Leandro, Gilroy, San Jose, and Santa Clara, CA.

arbitration clauses, business contracts, contract attorney, contract mistakes

A Legal Expert Should Be Reviewing Your Businesses Documents and Agreements

Business Attorney

Here’s Four Really Good Reasons

Many businesses don’t often hire independent counsel to review their business documents. The documents in question can range from a simple sales contract between your company and a new client, to a commercial space lease for a new location, to a complex asset sale agreement to sell or purchase an asset, product, or business.

It’s quite easy and natural for the Owner, Principal, or President of the company to review and sign-off on any contract that crosses his desk. Who better than the Owner, Principal, or President is most versed in the business and its products, markets, and services?

The Owner, Principal, or President of the business along with the business unit seeking the contractual relationship is most certainly the expert on the subject of the deal. The internal review is just one aspect of the review process for a legal document. When the document in question is a legal document or agreement, a legal expert should be brought in by the business to offer a legal perspective. It is critical for a legal professional to take a look before the document is signed and presented to the other party for approval.

Here are four really good reasons why in your next review of a business agreement you should strongly seek a legal expert to help you legally interpret and analyze the document:

1.    The cost of skipping an attorney review of your business agreements could put you out of business in comparison to what it costs to have someone review the documents and analyze the deal before signing the agreement.

2.    An attorney review of your business agreements can offer a fresh legal perspective and provide you with advice of current customs and practices in your industry relating to contracts.

3.    You are not an expert at contract interpretation or the law if a dispute arises. A lawyer is able to provide clients with interpretation and analysis of the law in your jurisdiction to the facts of your contract and/or potential dispute. No other professional is able to do that. Especially if a mistake was made during the contract formation or execution process, a lawyer can help your business solve the problem and defend your company in court when a deal goes sideways.

4.    A business lawyer is also your legal representative. During the drafting and negotiation of the contract, a business lawyer can stand in your place, negotiate with the other party’s counsel, and provide you with actionable intelligence on points in your agreement where you can influence or change terms to protect your business and receive a favorable outcome.

If you are a business in Fremont, Newark, Hayward, East Bay, Milpitas, Union City, San Leandro, Gilroy, San Jose, and Santa Clara, California, seek the legal advice and counsel of a business lawyer.  The Law office of Lynnette Ariathurai is ready to help.

business agreements, business contracts, document review, legal representation

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