Remote employees not automatically protected by California law

In a recent case, the California Court of Appeal answers an important and very basic legal issue for the state’s expanding remote workforce: When do California’s employment laws protect remote workers from termination by employers with their principal offices in California? California’s localized employment protections don’t automatically follow out-of-state workers home. A remote employee working outside California cannot rely upon the state’s labor laws unless there’s a substantial connection to California. 

Out-of-state arrest and remote dismissal 

Pejman Saberin—a remote engineer residing and working in Utah for California-based data software firm Alation, Inc.—was arrested in Florida while returning from vacation. His sister emailed the company requesting emergency leave because of an “accident,” but Alation executives uncovered the public arrest record through their own research. Upon his release, Alation terminated Saberin’s employment. After the underlying criminal charges were dismissed, he filed a lawsuit, which was ultimately sent to binding arbitration. 

Saberin alleged that Alation violated California Government Code and Labor Code Sections that prohibit employers from basing a termination on an arrest that didn’t result in a conviction. Alation countered these California laws couldn’t be applied extraterritorially to a Utah resident. The arbitrator ruled in Alation’s favor, finding the decision-makers were physically located in Illinois when they finalized the termination.