KEN KIRSCHENBAUM, ESQ
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Which law applies in employment contract when you have options
April 7, 2021
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Which law applies in employment contract when you have options
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Ken,
We are hiring an employee in Washington State. We are in New Jersey and our primary office is in New Jersey. We use the Kirschenbaum Standard Employment Agreement and require all employees to sign it. Our contract says New York law applies, except for California employees, where we agree California law applies.
Can you please advise what should be the preferable governing law and jurisdiction in this employment agreement?
Thank you in advance,
name withheld
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Response
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This is a tough question. I’m going to punt; shoot from the hip; contradictory advice welcome.
First of all you should consider which law you want to apply. Once you have choices, the choice of law option means you need to know the law in each jurisdiction and pick the one that is most favorable to you, as employer, or if you’re the employee asking, the employee. Hear you do have two choices, Washington, which I know nothing about, and New Jersey, which I wish I never heard of.
As long as you have a “nexus” – which is legal way of saying “connection” – you can pick either jurisdiction for contract disputes and contract enforcement. You can also provide for arbitration, which should be enforced by both state laws.
The Employment Contract will deal with two issues, which law applies and where lawsuits can be commenced and maintained; this is called jurisdiction and venue. Thus the contract could provide for New Jersey venue, but law of Washington applies. In that case the New Jersey judge would be required to apply Washington law. I think it likely that if the employee resides and works within a state with a strong public policy on an employment issue the court may be compelled to enforce that law notwithstanding a contrary provision in the Employment Contract.
I asked K&K’s employment lawyers to opine and off the top of their head the answer was you can pick either state law, though it’s probably that certain protective provision in a state law may not be waivable. By way of example, say the state where the employee is actually working requires an 8 hour a day employee get an hour for lunch or at least 2 half hour breaks; smoke time; 4 hours off to vote, etc., and the home state of the company doesn’t have those employment laws.
To answer the question directly, I’d select jurisdiction and venue in New Jersey [unless you’re smart enough to move] and choice of law of Washington. I’d also provide for arbitration using Arbitration Services Inc as the arbitration forum. Most importantly, be sure to get every employee to sign an Employment Agreement.
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Ken Kirschenbaum,Esq
Kirschenbaum & Kirschenbaum PC
Attorneys at Law
200 Garden City Plaza
Garden City, NY 11530
516 747 6700 x 301
ken@kirschenbaumesq.com
www.KirschenbaumEsq.com
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