CA Court Curbs Reach of State Employment Law to Out-of-State Staff
A California Court of Appeal held in Saberin v. Alation, Inc. that state employment law does not presumptively apply to an employee working entirely outside of California, even if their employer is based there.
A California Court of Appeal has provided new guidance on the application of the state's employee-friendly laws to staff working remotely outside its borders. In Saberin v. Alation, Inc., the court declined to apply California's legal protections to a Texas-based employee of a California-headquartered company. The ruling reinforces the principle that the employee's physical location is the primary factor in determining which state's laws govern the employment relationship. Sophisticated counsel and clients care because the growth of remote work has created significant legal uncertainty. This decision may offer some comfort to California-based employers, suggesting they are not required to extend the state's stringent wage, hour, and leave requirements to their entire out-of-state workforce. Companies should review their remote work policies and employment agreements in light of this framework. The key development to watch is whether the California Supreme Court will ultimately weigh in to create a uniform statewide rule.