Arizona Business Laws

Hi. I’m Craig Martin, and I do employment law here in the firm.

What is “at-will” employment in Arizona?

At-will employment means that an employer can fire an employee anytime the employer wants, as long as the firing is not for an illegal, improper, bad reason. In turn, the employee can leave anytime they want. It’s a very important principle in the law in Arizona and in most states.  Because basically it’s one of the best defenses an employer has when an employee claims they were wrongfully terminated.

What is a perfect employment case?

I look for the best employment case when I’m representing employees that I can find, and they’re certain factors that I look for to make the best case. Although it’s not necessary a long-term employee who’s been badly fired is better than a short-term employee. I look for whether there is a valid legal claim. Sometimes an employee is terminated for a reason that’s unfair, but that does not equate to a valid legal claim.  I look for real damages, I want to find the case where the employee has suffered real damages because of an employer’s firing on one day, and the next day gets a better job that’s far less likely there are any damages.  And in the end what I look for is a gut reaction that what the employer did was wrong.

Are all types of discrimination illegal?

People ask me about discrimination all the time. The discrimination that is illegal is the list of discriminatory actions that are listed in the law, and those include things that people have heard of, such as race, religion, national origin.  The first thing I want to do is hear their story and look at their documents. It’s important in assessing a case, to see whether the employee story fits, if it’s credible. And it’s important to see what documents they have, because it can make a major difference.  One of the problems I have in representing an employee is that, I only hear their side of the story, and it’s very important to me to hear what the employer has to say, because often times the employee hasn’t been told the whole story. I have to get the whole story when I assess a case.

By: Kraig Marton

First Meeting With Attorney

I’m Neal Bookspan of Jaburg Wilk. I’m an attorney who helps businesses and business owners manage their legal risks. The first meeting between a new client and an attorney is very important. To prepare for that meeting, it’s always good if the potential client not only spends the time to outline their issues and know the facts and issues that they’re coming to the attorney about. But then to not only prepare the documentation or bring the documentation, but to actually review their documentation while they’re outlining it. Because the more that they remember and the more that they know, the more successful that first meeting can be in figuring out whether they have a situation that the attorney can help them out or not.

By: Neal Bookspan

If I Won my Case, Should I Worry About an Appeal?

Hi. I’m Kathi Sandweiss at Jaburg & Wilk. I’m an appellate lawyer here. Congratulations on winning, first of all. But if your opponent appeals, you are going to have to defend the judgement. By defending the judgement, what we’re talking about is we need to tell the Court of Appeals that your trial judge didn’t make any reversible errors. The process as the appellee is simpler. It basically involves only one brief as opposed to the two briefs that the appellant would have to file, so there would be an answering brief that’s based completely on the record that was presented to the trial court. And at that point, we’re telling the Court of Appeals that, based upon the evidence presented, the fact finder, either the jury or the trial judge, did not make any errors, and that based upon the legal issues presented, the trial judge made no legal errors, and that’s very important because we’re looking at what’s the standard of review on appeal. If it’s a legal error that the appellant is urging, then it will be reviewed de novo. If there’s a factual error alleged, then the court of appeals will defer to the fact finder, which would be either the trial judge if it was a bench trial or a summary judgement motion, or it would be the jury. In that case, you’ve got a much better chance of it being affirmed on appeal.

If My Lawyer Made a Mistake, Can I Challenge the Appeal Outcome?

There’s a big difference between lawyer mistake and trial court mistake, and a big difference between lawyer malpractice and then appeal. Clients are always coming to me and saying, “I told my lawyer he should look for these financial records, and he never did, and he never presented them.” And clients will say, “I told my lawyer we had a fraud case, but he never raised that issue in the trial court, so can we appeal this?” And what I am telling you is, that’s not an appeal unfortunately. An appeal is based solely on the record that was presented to the trial court. If we don’t have that evidence in the record, we’re not going to be able to present it to the Court of Appeals. What the appellate court say is that they want the trial court to correct its own errors first. Therefore, if an error hasn’t been presented to the trial court, it’s not going to be presented to the Court of Appeals. The Court of Appeals can’t reverse it. What we’re looking for is an error by the judge. I know it sounds kind of funny, we’re looking for judge-made errors, but that’s what an appeal is. We’re looking at a three-judge panel, a higher court reviewing what one judge did in the lower court.

By: Kathi Sandweiss

Can an Employer Require a Drug Test?

My name is Kraig Marton, and I practice employment law here at Jaburg & Wilk. You know, an employer can require drug testing. In fact, an employer may have a duty to require drug testing because the employer has an obligation to make the workplace safe to the employees, to customers, and to anyone else who comes there. Maybe. An employer generally should have what’s called reasonable suspicion in order to require a drug test, although if an employer wants to randomly drug test, and it’s done randomly and uniformly, an employer could do that too. If an employee is told to take a test and they think they’re going to pass it, they probably should take the test. If an employee thinks they’re going to fail the drug test, they need to think carefully about why that is.

What if You are Required to Take a Drug Test?

If an employee is going to fail a drug test, possibly they should take it anyway, and turn themselves in for treatment. Many employers are humane, and will deal with the issue, allow the employee – with monitoring and treatment – to continue working.

Employer Protocol if Alcohol/Drugs Use is a Problem

One thing an employer should do is adopt a drug policy. There is a statute in Arizona that basically gives an employer what’s called a Safe Harbor from lawsuit if they have a policy and they follow it, so if an employer thinks that there is a problem with drugs or alcohol in the workplace, again, they have a duty to do something about it. They should adopt a policy followup, and occasionally a drug test. Drugs and alcohol have become a problem, and have been for many years, but many see an increasing problem in the workplace. It costs productivity, it costs time, it costs energy, it costs money, and drugs and alcoholism are a disease that needs treating, so I hope that if somebody has a problem, that they seek treatment. And I hope, if you’re an employer, that you’re humane with how you deal with the situation.

By: Kraig Marton

My name is Neal Bookspan. I’m a partner at Jaburg and Wilk. I help my clients manage their legal risks in the area of litigation, transactional work, and creditors’ rights.

Is it possible to diffuse the tension and emotional nature of a dispute between business partners?

It is possible to diffuse the tension between a partnership or what we’d call a almost corporate divorce situation. In these situations you’ve got shareholders or members at odds and entities. It can affect the day to day running of a business. It can affect employees, customers. And one of the things that you have to look at is when you get a lawyer involved it helps take the tension and emotion out of the situation because you’ve got a third party who is removed form the dispute itself who can look at things with a clear eye and business judgement to help advise the client in a manner in which will healthfully help put things on a business level and not a personal level.

Is it really possible for a client to avoid expensive and extended litigation?

It is possible for a client to avoid extended and expensive litigation sometimes. Any litigation is very lengthy and expensive no matter how you look at it. But there are ways to try and resolve disputes early on and try and avoid the situations that result in endless amounts of cash being spent and fees being incurred. A lot of times what I utilize with clients at this point is pre-litigation mediation, either formal or informal settlement and mediation talks, anything to try and resolve the situation. Or come to some type of partial settlement that will help streamline the litigation, make it shorter, and hopefully reduce expenses for not only our clients but all the parties which always helps matters get resolved.

By: Neal Bookspan

Hi, I’m Kraig Marton and I do employment law here in the firm.

Why do you call employment law alphabet soup?

Employers have to know so much when they’re engaged in the field of employment law. And there’s so many acronyms that are used that just learning them becomes difficult. There’s things like FMLA. There is USERA. There is COBRA. There’s HIPAA. One can go on. Now there’s the  ACA, some call it Obamacare just keeping track of the initials for the laws is hard much less keeping track of the actual laws that govern the employment relationship.

Which types of employers are more susceptible to get sued?

What I find is that an employer with (50) to (100) employees – who’s grown fast because it was a family run business – are those who are most likely to get sued. And the reason for that is, they grew fast and the controller or the sister is handling the HR functions instead of a HR professional. And so what happens is that if you’re not familiar with all of the laws that govern employment law, you’re going to make a misstep. You know the cost of a lawsuit these days is tens, probably hundreds of thousands of dollars to defend when an employer gets sued. And it’s a no-win proposition for the employer because if the employer loses, they not only have to pay the other sides attorney’s fees, they also have to pay whatever damages the jury assesses. On the other hand, if the employer wins, almost for sure, they don’t get back their attorney’s fees nor do they get back any real benefit other than vindication. And so what occurs is the cost of a lawsuit can be tremendous in administrative cost, in financial cost, and just in morale. And so if an employer pays attention to employment law in advance, and does things right, and follows the law, and treats employees fairly, they’re not going to get sued. Proactive is the way to go.

By: Kraig Marton

My name is Neal Bookspan. I’m a partner at Jaburg and Wilk. I help my clients manage their legal risks in the area of litigation, transactional work, and creditor’s rights.

How do you approach advising businesses or business owners about the legal risks they face?

I try to help my clients manage their legal risk. I consult with them on all aspects of their business and legal issues. This can include their employees who are both an asset and a burden, the contracts they have with customers and vendors, insurance issues. In doing this, I talk to them about what they’ve got in place, documents they could need, documents they have that might need to be revised, and try and figure out whether there’s something I can help them with, or possibly one of my partners can help them with because of the various specialties that we have within our firm.

What types of legal risks do businesses or business owners face?

Business owners face all kinds of legal risks. One of the initial things that jumps out usually is the risks relating to employees. In many businesses, they have a lot of confidential or trade secret information. It could be just the processes they use to work or their customer list. In looking at these items, a lot of times they’ve not put documentation in place to protect them if an employee leaves or is terminated. So a lot of times, we’re looking at how can we do things to help protect the business owners in the event that something does happen.  What we live in is the hypothetical world of the what ifs and so we want that when it comes to the real world and the reality of what the employers have to deal with, that they’re able to have the best position to maintain their business, and make sure people like former employees are not trying to take their business from them.

By: Neal Bookspan

I’m Beth Cohn. I’m an attorney at Jaburg Wilk, and I work in the area of business transactions.

How Do I Prepare to Sell My Business

What people need to do first is to determine whether they have a buyer for their business. And a lot of times they’ll come in and they’ll say, “I want to sell my business,” and I’ll say, “Who are you going to sell it to?” And they don’t really have an idea of how to go about finding a buyer.

Can’t Find a Buyer

Sometimes they will sell their business, and other times they can’t find a buyer, so what they look at is that they look at the possibility of children coming into the business. Or they sometimes look at the possibility of employees buying their business.

How Should I Transfer Ownership to My Children

Sometimes what they’ll do when they’re transferring to their children is that they may sell interests in the business to their children, and what the parents will do is that they will decrease their own compensation so that what they’re getting is payments for their business interests instead of getting paid salary. So that works out really well, and it creates the cash that the parents need, and it gives the children the ownership in the business.

What Are My Options Outside of Family Members

The two choices are to try to find a buyer during their lifetime so that they can at least get the liquidity from the business and enjoy that part of their efforts and labor. Or after they die it’s sometimes very difficult to sell the business, because when the key person dies a lot of times the value of the business goes down significantly.

By: Beth Cohn

About Donald Hudspeth

The Law Offices of Donald W. Hudspeth. The business of our firm is business.  We started the firm in 1992 after the large law firm that I worked for had dissolved. And because I had prior business owner experience, I decided to start a firm and target business owner plans. The business of our firm is business. Only practice area is business law. That includes transactions and litigation. We do start ups. We do contracts of all kind both locally and internationally. We also have a first rate commercial litigation department.

I think one fundamental advantage that we had over other business law firms is the fact that we have been on the other side of the desks as business owners before we became attorneys. That gives us hands on real time practical experience on what it is like to run a business.  The Law Offices of Donald W. Hudspeth. The business of our firm is business.

By: Donald Hudspeth