Startup Employment Law: Avoid Costly Mistakes Before They Happen
May 15, 2024
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Fenwick employment lawyer Sheeva Ghassemi discusses worker classification, misclassification risks, remote team employment laws, non-compete agreements, and AI bias in hiring. Key topics include exempt vs. non-exempt classifications, PEOs, AORs, EORs, navigating state-specific laws, and the legal implications of AI algorithms in recruitment.
Misclassifying workers can lead to major legal issues and financial penalties.
Managing employees across multiple states requires partnering with PEOs and crafting multi-state agreements.
Deep dives
Outlining the Changes in Employment Laws
The podcast episode delves into the significant changes in employment laws in 2023 at both state and federal levels, affecting various aspects from hiring to firing. The aim of the two-part series is to aid understanding of these changes and offer practical advice for managing them. Guest speaker Shiva Gossamy, known for her expertise in employment law, sheds light on the complexities faced by companies, including non-compete developments, anti-discrimination provisions, and challenges related to remote work.
Importance of Proper Worker Classification
The discussion emphasizes the legal risks healthcare organizations encounter when misclassifying workers, highlighting the distinction between contractors and employees, as well as the hourly versus salaried classification. Misclassification can lead to tax liabilities, legal ramifications, and financial penalties, particularly concerning issues such as failure to provide benefits or equity. Specific examples, like the California law requiring a minimum salary for engineers, underscore the potential consequences for companies.
Navigating Multi-State Employment Challenges
The episode explores the complexities of managing employees across multiple states, addressing the diverse requirements and administrative burdens involved. Strategies such as partnering with Professional Employer Organizations (PEOs), Employers of Record (EORs), and Agents of Record (AORs) are suggested to streamline operations and ensure compliance with varied state regulations. The conversation also touches on the importance of crafting multi-state agreements to mitigate legal risks and avoid potential conflicts in different jurisdictions.
In this episode, Fenwick employment lawyer Sheeva Ghassemi joins us to discuss various aspects of employment law that all founders should know. From the legal risks and consequences of misclassifying workers to navigating employment laws with remote employees across multiple states, this episode is a must-listen for anyone hiring and growing a team.
We discuss:
The difference between employees and contractors, and exempt vs non-exempt classifications
How misclassifying workers can lead to major legal issues
How to navigate employment laws with employees in multiple states
PEOs, AORs, and EORs, oh my!
What non-compete agreements are and when they are and aren’t enforceable
How AI algorithms in hiring can introduce bias and discrimination
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