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Last week, the 9th Circuit held in two related cases from California and Oregon that FedEx misclassified approximately 2,600 delivery truck drivers as independent contractors, rather than as employees. The cases—Alexander v. FedEx and Slayman v. FedEx—are an important reminder for employers that reality matters more than labels when it comes to classifying workers. 

On that note, the most succinct (and most memorable) summary of the rulings appears in Judge Trott’s short concurrence in Alexander:

“Abraham Lincoln reportedly asked, ‘If you call a dog’s tail a leg, how many legs does a dog have?’ His answer was, ‘Four. Calling a dog’s tail a leg does not make it a leg.’ . . . Labeling the drivers ‘independent contractors’ in FedEx’s Operating Agreement does not conclusively make them so . . . .”

The two cases dealt with virtually identical facts. FedEx’s Operating Agreement (“OA”), which principally governed its business relationships with the 2,300 California drivers and 363 Oregon drivers in each class, contained several generalized clauses that suggested the drivers were independent contractors. For example, the OAs provided that “the manner and means of reaching [the parties’ “mutual business objectives”] are within the discretion of the [driver], and no officer or employee of FedEx . . . shall have the authority to impose any term or condition on the driver . . . which is contrary to this understanding.” The two opinions noted, however, that neither California nor Oregon law views a contract’s description of a worker as an independent contractor as dispositive of the worker’s true status.Continue Reading 9th Cir. Finds FedEx Delivery Drivers Are Employees, Not Contractors

Earlier this month, a federal judge in San Francisco sentenced David Nosal to a year in prison, three years’ supervised release, 400 hours of community service, and $60,000 in fines. His crime? Nosal violated the Computer Fraud and Abuse Act (“CFAA”), among other federal statutes, when he departed from his former employer with a stash of its most sensitive business data.

Employment law doesn’t normally develop in criminal courtrooms, but Nosal’s case is an important exception. The outcome of his pending appeal to the 9th Circuit will almost certainly offer important guidance for employers on how best to prevent and, where necessary, remedy employee data theft. It’ll likely reinforce a familiar lesson: employers should craft their employee technology policies with an eye toward the law of data security. A well-developed IT infrastructure can give an employer substantial legal advantages and lead to better outcomes when employee data theft occurs.

What Is The CFAA?

To understand the practical importance of Nosal’s case, employers should first understand how the CFAA can apply to departing employees who steal company data. Congress passed the CFAA in 1986 – before the advent of most modern information technology – to combat computer hacking. The CFAA makes it a federal offense to obtain information or perpetrate a fraud either by (a) accessing a computer “without authorization,” or (b) by “exceed[ing] authorized access” on any such computer. In addition to its criminal penalties, the CFAA creates a parallel civil cause of action for hacking victims.Continue Reading David Nosal, Employee Data Theft, and Why Employment Lawyers Should Understand Their Clients’ IT Infrastructure

A single Ninth Circuit judge, in his capacity as chair of the Circuit’s Standing Committee on Federal Public Defenders (“the Standing Committee”), recently ruled in the unpublished decision of In the Matter of Alison Clark that the federal Defense of Marriage Act (“DOMA”) and Oregon’s Measure 36 violate the United States and Oregon Constitutions by unlawfully discriminating against same-sex couples.

Alison Clark, a federal public defender in Oregon, married Anna Campbell in Canada in 2012. Clark’s marriage was not recognized in Oregon, due to Measure 36, a ballot initiative passed in 2004 that defined marriage as between only a man and a woman. In addition, the federal government did not recognize Clark’s marriage, as DOMA similarly defines marriage as a legal union between one man and one woman.Continue Reading Ninth Circuit’s Standing Committee on Federal Public Defenders Finds DOMA and Oregon’s Measure 36 to be Unconstitutional

The Ninth Circuit Court of Appeals ruled recently that an independent contractor may assert a disability claim against an employer under the Rehabilitation Act.  Click the link to read the opinion on Fleming v. Yuma Regional Medical Center. 

The Rehabilitation Act prohibits discrimination on the basis of disability in programs conducted by Federal agencies, in…

Yesterday the U.S. Supreme Court declined to review a Ninth Circuit Court of Appeals decision that allows the Equal Employment Opportunity Commission (EEOC) to continue investigating allegations of employment discrimination, and even to issue subpoenas to employers, after issuing a right-to-sue letter to the employee who filed the initial complaint.  Click here to read the Ninth Circuit decision in…

The Ninth Circuit Court of Appeals earlier this week certified a question to the Washington Supreme Court, seeking that court’s help in defining "disability" under the Washington Law Against Discrimination (WLAD). 

Two years ago, in McClarty v. Totem Electric, 137 P.3d 844 (2006), the Washington Supreme Court significantly narrowed the definition of "disability" under…