On June 30, 2011, the California Supreme Court ruled that work performed in California by nonresident employees for California-based employers is covered by the California Labor Code and its unfair competition laws. That means that employees residing in states outside California but working (even occasionally) in California may bring lawsuits against their California employers for unfair competition based on violations of California’s generous overtime requirements. This is not good news for employers.

On the positive side, the Court also concluded that non-resident employees may not bring unfair competition claims in California based on violations of federal overtime laws when working outside California. Sullivan v. Oracle Corporation.