Archive for the 'Business' Category

Supreme Court Limits Patent Rights

One of the hallmarks of a successful business is protections on an invention which provide a barrier to competition beyond just money–a patent. Whether you’re an inventor or an entrepreneur, intellectual property protection is close to the heart of your livelihood. Keeping track of what these protections offer is crucial, and these last couple weeks has been enormous for patent law rulings out of the US Supreme Court. First, they limited jurisdictions for patent infringement cases substantially-making patent law much more defendant friendly. Even more recently, and more importantly for patent rights, they limited patent’s exclusive rights by applying the first sale doctrine to patent law at home and abroad with more force than ever before.

What is the First Sale Doctrine?

The first sale doctrine is a concept, also known as exhaustion, that is found as part of the statutory law behind copyright law. The rule is fairly simple but requires a bit of an understanding of the rights intellectual property grants you. Owning a copyright in a work gives you the exclusive right to sell (or really distribute in any way), display, make copies of, or make directive works from that work. Out of all of these, the first sale doctrine exclusively impacts the distribution rights. Once you’ve sold something, or even intentionally given it away, you have “exhausted your distribution rights in that particular work. This means that whoever owns the object or work now is free to sell it, put it on display, blow it up with dynamite-basically distribute or dispose of it as they wish. They can’t make copies, you keep that right, but the distribution right is gone after first sale-thus the first sale doctrine. In Impression Products v. Lexmark, the Supreme Court took this concept from copyright law and decided how it should apply in patent.

Laser Printer Losers-The Case Itself

Lexmark makes laser printers and, more importantly for this case, toner cartridges for those printers. These cartridges, once used up, can be much more cheaply refilled than replaced. This left Lexmark with a bit of a problem-an entire market dedicated to underselling their products by refilling and reselling cartridges. These businesses buy up used cartridges from US purchasers and purchasers abroad to resell them after a refill. With these competitors in mind Lexmark offered their product in two ways, at full price with no stipulations or at a lower price along with a promise to return the cartridges to Lexmark. In order to enforce this, Lexmark included microchips in their cartridges to prevent reuse-a measure the refillers promptly learned how to circumvent.

After failing to curb the businesses of these competitors, Lexmark decided to sue all the companies refilling and selling their used cartridges. They had a big problem though, the contract to not resell the cartridges wasn’t with the refillers it was with the clients who sold to the refillers. Thus, with no contract to assert, Lexmark said that these refillers were infringing on their patent rights.

A patent gives its owners the right to exclude others from making, using, selling, or importing the invention. Lexmark said that because they prohibited reuse and resale in their contracts, the refillers were violating their distribution rights. By the time the case reached the Supreme  Court, there were two serious questions to be addressed. First, whether the contract term could be enforced against the refillers through a patent infringement lawsuit. Second, whethand for patent rights abroad, the answers were no and yes respectively.

What the Decision Does

Case law has long established that exhaustion can apply in patent similar to how it does in copyright law. With this and some recent Supreme Court rulings in mind, the outlook was never particularly good for Lexmark.

As enforceable as their no sale agreements were under contract law, the Supreme Court wasn’t buying it under patent law. The argument, and Lexmark’s hope, was that by selling something with a restriction against further sale they had preserved their first sale rights. This isn’t the case according to the Supreme Court, you can’t contract around the first sale doctrine. Once you sell something

Exhaustion abroad is something the Supreme Court has already addressed for copyright law-and they didn’t go the way Lexmark would want in that case. So it’s no surprise that they followed their own previous ruling in applying exhaustion to patent. From now on selling something outside the US officially counts as a sale under the first sale doctrine and exhausts your distribution right.

These rulings mean that patent rights have been limited, more strictly applying the first sale doctrine to your patents than ever before. However, for those following intellectual property law, this ruling has been more a matter of when than if. The Supreme Court was simply consistent with how it’s handled copyright law in the past.

It’s worth noting that a license is not a sale and that exhaustion applies only to the item actually sold.  This will limit this ruling for many common items such as software or iTunes songs as you more often license these products than actually purchase them.

What’s more, the ruling skirts around the edges of a few other areas of law. Anti-circumvention makes it illegal to, as the name implies, circumvent effective security measures such as the microchips Lexmark installed in their cartridges. Repair and reconstruction is a distinction within patent law. You are allowed to repair an object with a patent on it, but full reconstruction can cross into the territory of patent infringement. While both of these might have applied in this case, neither were considered by the Supreme Court whatsoever.

This ruling will mean that you and your business need to be more careful about how you handle sales if you want to protect your distribution rights in something. There are ways to maintain your rights, depending on how you distribute your product. After this ruling, it’s more important than ever to consider how you’re going to handle your rights and your product.

Whole Foods Loses the Fight to Stop Employee’s NLRA Right to Record

As an employee, protecting your rights is incredibly important. However, even with full knowledge of the rights you possess it can be tricky to identify situations where rights are violated and gather the evidence to prove your case when you look to enforce those rights. Communicating with others and recording situations where your rights may have been violated can be critical in making a case or even just determining whether your rights have been violated in the first place. Thankfully, your right to record in the workplace was just given a major boost in a recent ruling against Whole Foods by the National Labor Relations Board (NLRB).

The NLRB is the federal agency in charge of enforcing labor laws related to unions, collective bargaining, and unfair labor practices-primarily as set forth in the National Labor Relations Act (NLRA). Just a few weeks ago, the Second Circuit upheld a decision of the NLRB deciding that Whole Foods had violated the NLRA through a policy barring recording conversations, phone calls or meetings in the workplace without manager approval.

With this case upheld on appeal, let’s take a look at the rights the NLRA grants you, the case itself, and what the case means for you as an employee or an employer.

Your NLRA Rights

The NLRA itself provides you a fairly broad suite of rights related to your ability to organize and bargain collectively. Under the act you have the right to (or not to) self-organize, form, join, or assist labor organizations, bargain collectively through representatives of your own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection. This basically means you have the right to choose whether or not to join with other employees in bargaining for employment terms. You also have the right to take the steps necessary to coordinate that group bargaining.

In order to protect these rights, the NLRA also makes it an unfair labor practice for an employer to “interfere with, restrain, or coerce employees in the exercise” of any of the rights discussed above.

The Case Against Whole Foods

Whole Foods had two policies on the books that got them into the legal trouble which led to this case. First, a policy forbidding any audio or visual recording of company meetings-with any recording device-without prior approval of a manager. The second policy applied a similar recording ban on any conversation held during business hours. These policies applied to any topic of conversation and all areas of every Whole Foods store.

The stated goal behind these policies was to encourage “open communication” and “spontaneous and honest dialogue.”  Whole Foods argued that, regardless of the policy, they strove to foster a culture where employees were free to speak up though open door policies and “town hall meetings.” They argued that recording meetings would damage the anonymity behind complaints and weaken employee rights.

However, the NLRB and the Second Circuit weren’t buying it. The test to see if rights have been violated isn’t whether an employer provides sufficient avenues for an employee to speak out, but rather whether the policy could inhibit an employee’s NLRA rights.

Whole FoodsWhen Does a Policy Violate the NLRA?

A policy inhibits rights where it would “reasonably tend to chill employees in the exercise or their” NLRA rights. This means that policies which tend to make it harder to exercise your rights are not ok. This can happen where a policy explicitly restricts you from doing something the NLRA guarantees. However, a policy also violates the NLRA when: 1) an employee would reasonably consider in to prohibit them from asserting NLRA rights; 2) the rule was made in response to union activity, or 3) the rule, despite how it is written, has been used to restrict employees’ NLRA rights. Where a rule is ambiguous, but could be interpreted to violate NLRA rights, it still violates the NLRA. This unacceptable overbreadth exists when an employee would reasonably interpret the policy to prevent exercise of NLRA rights. It is this rule against overbroad policies that worked against Whole Foods.

Ruling Against Whole Foods

The policies are a blanket ban on all recording. However, photography and video recording in the workplace have historically been guaranteed when it is done to document a potential violation of rights under the NLRA unless there is a particularly compelling reason for the employer to ban them such as the heightened privacy interests of patients within a hospital. The NLRA has even been interpreted to guarantee an employee’s ability to post these photographs and recordings on social media.

Despite Whole Foods stated purpose of maintaining open communication, the policies as written prevented employees from exercising these rights. Thus, the policies violated the NLRA by inappropriately curtailing protected employee actions.

However, the ruling didn’t hold Whole Foods’ feet to the fire too much. It only really required them to retract the policies, or at least reword them to provide exceptions for NLRA protected recording.

What Does This Mean For Employers and Employees?

One thing to keep in mind is that this is not the only time in recent memory that the Second Circuit has backed the NLRB in expanding the definitions of employee rights under the NLRA. It was just May of this year that they ruled that an employee had the right under the NLRA to post quite unflattering things about his manager in a social media post because the post also discussed an ongoing union election. This could be seen as a trend towards expanding the spheres in which an employee enjoys NLRA protection.

For employees, this ruling means that you enjoy greater NLRA protections on your right to organize and record the behavior of your employer. This is incredibly important because proving a violation of your NLRA rights will often require this sort of recorded evidence.

As an employer, this ruling can act as guidance for crafting policies on recording that avoid the mistakes of Whole Foods. Recording restrictions haven’t been banned altogether, rather recording restrictions without clearly defined exemptions for NLRA rights have. The lesson here is to make sure that your policies include these exemptions in order to avoid trouble with the NLRB.

So is this the beginning of a trend where NLRA rights catch up with tech? It’s simply too early to say. However, the trend is encouraging. Recording devices are more broadly available than ever before. It’s a safe wager that a large portion of those reading have one in their pocket or purse as we speak. With recording rights protected, it’ll be easier than ever before to gather the evidence necessary to protect your rights-and that’s encouraging.

Uber Part 2: Is Levandowski Guilty of Stealing Trade Secrets?

Yesterday, we talked about Waymo’s lawsuit against Uber over the alleged theft of the secrets behind Waymo’s self-driving car technology. What we didn’t get a chance to get into is the criminal consequences for the man who allegedly stole the files in the first place-Anthony Levandowsky.

After years of working with Google and Waymo, Levandowsky allegedly quit with no notice; making off with upwards of 14,000 confidential files relating to Waymo’s self-driving car technology. He immediately started his own self-driving software firm named Otto. Then, mere weeks after Otto came into existence, Uber (in the process of designing its own self-driving technology named Lidar) bought the whole shebang for $680M.

This led to the lawsuit against Uber, which we discussed in a previous article. However, it also might lead to even more serious problems for Levandowski.  When Uber’s attorneys attempted to question Levandowski in an effort to gather evidence for their civil case, he invoked his 5th Amendment right against self-incrimination. Pleading the 5th is asserting your right to not be forced to act as a witness against yourself in a criminal case but can be used to avoid testifying in either a criminal or a civil case so long as the answer to a question would tend to incriminate you. In a criminal trial, pleading the 5th can’t be used by a jury as evidence that somebody is guilty. This is not the case in a civil trial however, the jury is free to make any inferences they like when somebody pleads the right to avoid self-incrimination.

The judge in the case, Judge William Alsup, has certainly taken issue with Mr. Levandowsky’s actions. Taking into account both Levandowsky’s plea and apparently substantial evidence against him Judge Alsup has taken the rare step of reffering Mr. Levandowsky to the US Attorney’s Office for criminal charges.

The US Attorney’s Office may or may not proceed on Judge Alsup’s recommendation. Even if they do, it’s no guarantee that Levandowski will be found guilty-criminal proceedings require a higher standard of evidence. Criminal trade secret law is also similar, but not identical to its civil counterpart. In order to figure out exactly how much trouble Levandowsky is in, let’s take a look at exactly how criminal trade secret charges work as well as when and how the US Attorney’s Office decides to bring charges.

UberCriminal Trade Secret Law

Trade secret theft is a white collar crime under both state and federal laws. In federal law, the type of law Levandowsky would be facing if charged, it is governed by the Economic Espionage Act of 1996 (EEA)

Under the EEA, it is illegal steal, take without permission, carry away or obtain a trade secret by deception. It is also illegal to copy, download, upload, alter, destroy, transmit, give away, or sell a trade secret without permission. The EEA also makes it a crime to receive, buy, or own a trade secret that you know was wrongly obtained. A trade secret is defined as information that is made more valuable by being secret where its owner has taken reasonable steps to make sure the information stays secret.

For those of you who have read the article describing Waymo’s lawsuit against Uber earlier this week, these elements will sound quite familiar. However, there are a few differences between the criminal and civil sides of trade secret. First, the EEA makes it a crime to attempt or conspire to commit trade secret theft. At civil law this is not the case. As mentioned above, the standard of evidence is substantially different. Civil law requires a preponderance of the evidence-fifty percently likelihood plus a feather-criminal requires proof beyond a reasonable doubt. However, the single most substantial difference between civil and criminal trade secret is that criminal trade secret always requires evidence of intent and knowledge-the intent to “convert a trade secret” and knowledge that the person was committing one of the acts that are illegal under the EEA. Evidence of an intent to covert means that it must be shown that a person acted with the intention of exerting control over somebody else’s property which is not authorized by the property’s owner.

The evidence from the Waymo case makes it seem pretty cut and dried that Levandowski, at a minimum, took the 14,000 confidential documents without permission. His employment agreement made it fairly clear that they were not his to take. This means a criminal case against him would likely hinge on intent and knowledge. For somebody Levandowski, this would likely require proof that, at the specific time he committed a crime under the EEA, he did so with the intent to either use them himself or share the secrets contained within the documents he downloaded. The evidence certainly points this way. Especially damning is alleged evidence of plans to sell Otto to Uber from before Levandowski even left Waymo. Knowledge would require evidence that Levandowsky knew he was not supposed to take the documents he did. As mentioned already, we know this is the case because his employment agreement clearly forbade him to take and share those documents.

Will Criminal Charges Be Brought?

You can see that there’s a pretty strong potential case here against Levandowski. It’s worth noting that it is by no means ironclad. Levandowsky certainly had access to the files, partially because of his position. However, how easily accessed those files are might impact whether Waymo took sufficient measures to protect their trade secrets. The issue of intent may also be muddied somewhat by the exact level of access to the files Levandowsky was allowed in his position. If he actually believed he was allowed to take the files then he would not have the necessary intent for a criminal conviction.

All of this will be taken into account when the US Attorney’s Office decides whether to prosecute the case. Due to how overextended the budget of the Attorney’s Office is, criminal charges under the EEA are moderately rare. They often come up in situations where the secrets are owned by the government and/or are taken by international agents-a situation that the EEA slaps with higher penalties. For instance, the very first (and potentially most famous) EEA trade secret case involved a Chinese national who stole trade secrets related to the US Space Shuttle Program from Boeing.

Levandowsky is certainly not on this level. However, he would be far from the first homegrown conviction. Nor would he be the first criminal conviction that didn’t deal with earth-shatteringly important secrets-space shuttles, military software, and the like. In fact, the US Attorney’s Office has a published policy for how it decides whether it should prosecute a violation under the EEA. This policy looks at a number of factors including : 1) how wide the scope of the criminal activity is and especially whether a foreign government is involved; 2) how bad the economic injuries are to whoever owns the trade secret; 3) what type of trade secret was stolen (military secrets are obviously way up there on the priority list); 4) how effective a civil remedy would be; and 5) the potential deterrent value of bringing criminal charges-how much it will scare off similar criminals.  The existence of a civil remedy doesn’t weigh that much against prosecution as that remedy will almost always exist.

Levandowsky, if guilty, has immeasurably damage Waymo in their quest to be first to market in the burgeoning self-driving technology field. However, his single act of theft from a private company who is already suing in civil court might just be too small fry for the US Attorney’s Office to bother with.

What Does Levandowsky Potentially Face?

We’ll have to see if the US Attorney’s Office chooses to pursue a case against Mr. Levandowski. It’s unlikely Judge Alsup would have recommended charges if the case against Levandowski was not particularly strong. If they do chose to come after him, he’ll be facing up half a million in fines and a decade in prison.

Even with just the civil case leveled against him, Levandowski is in hot water. Criminal charges would take that water to boiling. However, even if the US Attorney’s Office does bring charges they are unlikely to do so particularly soon. For now, Levandowsky will just have to stew and hope.

Uber, in Trouble Again, For Allegedly Stealing Trade Secrets from Waymo

Uber has a bit of a history of asking for forgiveness instead of permission when it comes to the law–a trend which hasn’t worked out particularly well for them. This has come back to bite them again in the case brought against them by the Google owned self-driving car project Waymo.

After an engineer, Anthony Levandowsky, allegedly left Waymo with thousands of confidential files he set up a firm which Uber promptly purchased for $680M. It’s no surprise Uber was interested in what he was offering, they have long been developing their own self-driving technology. Among this technology is a laser navigation tool known as Lidar.

Just about a week ago, the judge handling the case-Judge William Alsup-ruled that Levandowsky knew or should have known he was in possession of this confidential material and barred Uber from using any of the technology brought by Levandowsky in their products. The judge’s order states that Waymo has produced “compelling evidence” that Levandowsky and Uber had planned the acquisition of Levandowsky’s firm before he had even left Waymo. The order also says that the evidence showed that Uber hired Levandowski even though they “knew or should have known that he possessed over 14,000 confidential Waymo files.” Judge Alsup’s order requires Uber to not to allow Levandowski to work on their Lidar project or use the files he downloaded for the duration of the lawsuit. It also requires them to return all the files to Waymo by this Wednesday, May 31st. Despite all this, the ruling has still been hailed as something of a victory for Uber. Waymo didn’t get their ultimate wish-shutting down Uber’s Lidar project entirely until the lawsuit is resolved. The court also didn’t consider some of the things claimed by Waymo as true trade secrets-not surprise given that Waymo had listed 121 potential trade secrets that were allegedly stolen. What’s more, while Waymo has succeeded in receiving an injunction on the issue of trade secret misappropriation, they have failed to do so on their second cause of action for patent infringement.

UberDespite this, the ruling is a huge blow against Uber’s self-driving car program. As the case goes on, it could get worse for both Uber and Levandowsky. Federal trade secret law includes potential repercussions in both civil and criminal law. Levandowski himself invoked his Fifth Amendment right to not incriminate himself when attorneys representing Waymo questioned him.

The trade secret rulings here are the meat of this order and the problems for both Uber and Levandowski. In this two-part article, let’s look at how civil and criminal trade secret law works and how it was applied in reaching this order.

How Civil Trade Secret Law Works

Waymo’s lawsuit against Uber is firmly in the realm of civil law. Thus, it is civil trade secret law that was used in reaching this ruling. Waymo’s lawsuit alleges violations of both the California Uniform Trade Secrets Act and the Defend Trade Secrets Act.

California’s Uniform Trade Secrets Act is one of the many nearly identical state laws handling trade secrets based on the Uniform Trade Secrets Act. Every state except New York, North Carolina and Massachusetts. It’s worth noting that near identical is not identical and many states have small but meaningful differences in their approach to trade secrets.

The Defend Trade Secrets Act is a federal law passed by the Obama administration in May of last year. It serves to extend the Economic Espionage Act of 1996 (basically federal criminal law applying to trade secret theft) to include a civil cause of action nearly identical to the Uniform Trade Secrets Act.

So what exactly is a trade secret? Any information can qualify so long as it fulfills certain criteria. First, the information must be more valuable for the very reason that it secret-if it isn’t actually secret it is basically impossible for this to be the case. Second, its owner must have taken reasonable steps under the circumstances to make sure it stays secret.

Where something that qualifies as a trade secret is misappropriated, that violates civil law. The California version of the Uniform Trade Secret Act (CUTSA) treats misappropriation as acquiring a trade secret through improper means or from somebody you know or have reason to know got the secret by improper means. It also includes using or disclosing a trade secret you acquired or at least should know was acquired by improper means. Improper means include, but aren’t limited to theft, bribery, misrepresentation, breach or inducement of a breach of duty to maintain secrecy, or espionage. However, improper means never includes a situation where you figure out the trade secret on your own.

Mr. Levandowski left Waymo with confidential files his employment agreement clearly said were not his to take. The evidence shows that there is at least a strong chance Uber bought Levandowski’s firm knowing exactly what it was getting. This means that there is a strong case against both for misappropriating Waymo’s trade secrets. While not all of the things claimed as trade secrets by Waymo, as with most trade secret cases exactly what those secrets are is heavily redacted to maintain their secrecy, enough satisfied the test described above to put both Levandowski and Uber in hot water.

Injunction Against Uber

The order has granted a preliminary injunction against Waymo with the effects described above. A preliminary injunction is an order stopping a party to a lawsuit from doing something before the lawsuit even really gets underway.

In order to receive a preliminary injunction a party needs to show a likelihood that they’ll win, the potential that they will be harmed in a way money can’t fix, a public interest in such an injunction, and that they will be more harmed by the lack of an injunction than the party it’s brought against will be harmed by the injunction itself.

We’ve seen that there’s a pretty good case here for trade secret misappropriation. However, likelihood of success was where Waymo lost on their patent infringement arguments for the injunction-they simply didn’t have enough evidence.

In terms of irreparable harm, the technology in question has the potential to change who controls the burgeoning market of self-driving cars going forward. This is something of incalculable value and thus no simple money damages could properly address it. There is also a clear public interest in both protecting intellectual property rights and preventing unfair competition via potential corporate theft.

However, it is the balance of harms element that really led to the limitations that led to some calling the ruling an Uber victory. As serious as the harm would be to Waymo if the Lidar project used their trade secrets to advance their technology, shutting down Lidar altogether for the multiple years it will take for the lawsuit to resolve would kill Lidar altogether. This is extreme in the opposite direction, thus why the judge chose to simply prevent Lidar from using any of the secrets they may have misappropriated.

What Does This Mean For Uber and Levandowski?

The process of ensuring that none of Waymo’s documents, and the information contained therein, makes its way into the Lidar project is no mean feat and will certainly slow down Uber’s progress; giving Waymo a leg up on its competition. It also means that, at least for now, Uber may have spent nearly three-quarters of a billion dollars on nothing. The order also indicates a strong chance of success for Waymo in their trade secret action against Uber. This could lead to an enormous money judgment against Uber in the future.

As bad as it is for Uber, it’s much worse for Anthony Levandowski himself. The judge in this case has already referred his situation to the US Attorney’s Office, recommending criminal charges against Levandowski. This is an uncommon move on the part of this judge and could ultimately lead to up to fines of up to half a million against Levandowski and up to a decade in prison. Later this week, we’ll look into exactly how the criminal side of trade secret works. However, suffice it to say, Levandowski is facing down some serious charges.

Day of Rest: CA Supreme Court Clarifies the Requirements

Whether you are an employee or an employer, knowing exactly how wage-an-hour law works is crucial. No employee wants to be underpaid and no employer wants to be staring down the barrel of a lawsuit. However, no matter how well acquainted you are with the requirements of employment law there will always be edge cases and ambiguities-that’s why there are lawyers.

One of the most egregious of these ambiguities in California employment law has been the state’s “day of rest” provisions. Causing employers and employees alike to tear their hair out over whether they’re paying or being paid properly, the law has been in place for years without a final ruling on how it works.

In California, and in many other states, there are several situations which require an employer to pay overtime to their employee. Barring specific exceptions, such as an employment agreement specifically allowing an alternate schedule such as four days of ten hours each, these situations are include days where an employee works over eight hours in a single day or over 40 hours in a single work week. However, the “day of rest” provisions include a third situation where overtime must be paid. Whenever an employer “causes “an employee to “work more than six days in seven.”

Day of RestWhile there has been sort of an unspoken agreement as to what this exactly means among the courts, the phrasing of the law has left many interpretations up in the air and no court had ever sat down and explicitly said what the law meant.  This left employers and employees alike in a state of legal limbo. Does the law prevent an employer from making somebody work any seven days in a row or only in each workweek? When exactly has an employer “caused” an employee to work seven days in a row? Are there any exceptions to the “day of rest” rules?

After the 9th Circuit Court of Appeals punted to the California Supreme Court on all these ambiguities, the highest court in California has come to the rescue of confused employers and employees. In a recent ruling they have answered all these questions and put to rest one of the longest running mysteries in California employment law.

So How Do “Day of Rest” Rules Work?

First, the Court addressed the most pressing question-when has an employer violated day of rest provisions in the first place? In other areas of California employment law, it is common to calculate overtime as part of a single workweek. A workweek can start on any day, but once it’s defined it will always be the seven day period starting with that day. Most businesses use Monday to Sunday for their workweek. The California Supreme Court followed this trend in deciding what exactly counted as working more than six days in seven. They ruled that the purpose of the law was to guarantee a day of rest in any given workweek as opposed to any given string of seven days. This means that an employer can have an employee work more than seven days in a row. In fact, with a day off at the very beginning and the very end an employer could have an employee work as many as twelve days in a row across two workweeks. With a standard workweek this would involve having the first Monday off, working until the Saturday after next, then having that final Sunday off.

The Court also ruled on what it means for an employer to “cause” an employee to work more than six days in a workweek. Interpreted literally, “cause” could mean literally any situation where an employee works seven days in a workweek-regardless of a waiver on the employees part. Once again, the Supreme Court officially ruled that this is not the case. While “an employer causes its employee to go without a day of rest when it induces the employee to forgo rest to which he or she is entitled. An employer is not…forbidden from permitting or allowing an employee, fully apprised of the entitlement to rest, independently to choose not to take a day of rest.” To cut out the legalese, this means that if an employee wants to work seven days in a workweek despite being told they don’t have to the employer has not violated “day of rest” rules.

Finally, the Supreme Court ruled that there is an exception to the “day of rest” rules where an employee never works more than six hours in a day during a workweek. If an employee works more than six hours in any given day during a week then “day of rest” rules apply to that employee for that workweek and they need to be offered at least one day off.

What Does This Ruling Mean For Employers and Employees?

For California employers, this ruling is huge for two reasons. First, by removing the ambiguity in “day of rest” laws the Court has allowed these employers to operate without fear of surprise lawsuits. Second, the exact rulings will give employers plenty to celebrate. By and large, the Court’s rulings on the matter have offered employers the largest possible latitude in handling “day of rest” rules without removing the requirement altogether. The ruling allows the day of rest to be provided whenever is convenient within a workweek, allows employees to forgo a day of rest, and even provides outright exemptions for some part-time (and full-time) employees.

But California employees have something to celebrate as well. While the “day of rest” rights have been given more liberal interpretation, they are still well-defined rights which every employee can enjoy. The ruling of the court corresponds closely with how most courts have interpreted the rights up until now. Instead of losing rights, employees have a better idea of what exactly their rights are. This means an employee, and a lawyer advising that employee, can be more sure that they have a strong claim before bringing what might be an expensive legal action.

Now that these rights are more clearly defined, it’s never been more important to thoroughly understand them. Whether you’re an employee or an employer, how to handle day of rest has been demystified and that’s something to smile about.