Seyfarth Shaw San Francisco partner Laura Maechtlen and Los Angeles office associate Simon Yang co-wrote an article published in The Recorder on August 2. The article discussed recent California Supreme Court Case Sullivan v. Oracle, which held that employees of California-based companies residing in Colorado or Arizona, and predominantly working there, are subject to California overtime laws when when they spend time working in the state of California.
Laura and Simon provide background information on the case, and they discuss the preceding Ninth Circuit U.S. Court of Appeals ruling (later withdrawn) that "California has chosen to apply its Labor Code equally to work performed in California, whether that work is performed by California residents or out-of-state residents," and the Unfair Competition Law "does not apply to the claims of nonresidents of California who allege violations of the Fair Labor Standards Act outside of California."
According to Laura and Simon, employers and employment practitioners should be aware that plaintiffs' attorneys may argue that the Supreme Court's decision may have broader implications, such as applying retroactively, and it is also anticipated that the argument will be made that "a logical extension of its reasoning suggests that similar conclusions may result for non-California-based employers." They posit that the safest course may be for employers to avoid sending non-California employees to work in California, until further guidance is provided by the courts on how far the Sullivan decision will extend.
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