Commonly Overlooked Contract Clauses

March 30, 2022

As part of our practice, we draft and review contracts for businesses in many different industries. Despite the differences in industries, there are many common types of contract provisions. It is a good idea to review your contracts to make sure that you understand every aspect of what you are agreeing to.


For instance, a common clause in any business-related contract is a Choice of Law provision. What is a Choice of Law provision? A Choice of Law provision is an agreement between the parties as to which laws will apply in the event of a dispute. While it may seem like “boilerplate” contract language, and therefore not essential to the agreement, this clause can actually be very significant. As upper management and business owners are aware, sometimes laws differ between states. The laws of one state may be more favorable to one side of the contract than the laws in another state. Further, Choice of Law provisions are also usually accompanied by an agreement as to the forum where any potential dispute would be resolved. This is also a very important clause. If you are a Massachusetts business doing business with a company in California, such a forum selection clause could require you to engage in litigation in California in the event of a dispute. Such far reaching litigation would potentially have an impact on your ability to pursue relief and/or defend the action.

   

Another common contract provision that follows the Choice of Law provision is the legal concept of “damages”. Generally speaking, if one party breaches the contract, the other side will be entitled to “damages” in order to compensate it for its loss. The legal theory behind damages is to make the non-breaching party whole by compensating them for their loss. However, sometimes the loss can be difficult to calculate. Therefore, some contracts contain what is called a “liquidated damages” provision. This is usually common in the construction industry. What are liquidated damages? Essentially, liquidated damages constitute an agreement that the parties have agreed as to what the “damages” will be in the event of a breach. You therefore want to be aware of this potential clause in a contract. Generally speaking, a “liquidated damages” provision is not enforceable if it is intended to be a penalty for breaching the contract, as opposed to being intended to make the non-breaching party whole. If you are relying on a liquidated damages provision, it is a good idea to consult with counsel to obtain an opinion as to whether or not such a provision is enforceable.


There are other standard contract clauses including attorneys fees, possible alternative dispute resolution, interest rates, default provisions, notice provisions, and more that can also be crucially important. We will discuss these more in coming blogs.


If you have any questions regarding commercial contract related issues, please do not hesitate to contact the attorneys at The Royal Law Firm, LLP.

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July 14, 2025
Welcome Michael!

Remote Workers and the WARN Act

July 9, 2025
Background: The e-commerce website Zulily liquidated in May 2023 and laid off its entire workforce by the end of 2023. While in-person workers at Zulily’s Seattle headquarters and fulfillment centers in Ohio and Nevada received 60 days’ notice or pay under the Worker Adjustment and Retraining Notification (WARN) Act, remote employees were not given any notice or pay. Four remote workers—two based in Washington and two based in Ohio—filed a class action lawsuit claiming that this was a violation of the WARN Act and state wage laws. The workers argued that because their roles were assigned to corporate offices or fulfillment centers, they should have been considered “affected employees” under the WARN Act when those sites closed. In a decision that could signal a significant shift in how the WARN Act applies to remote workers, the federal judge refused to dismiss the workers’ claims.  Key Legal Questions 1. Do Remote Workers Qualify for WARN Act Protections? The core of the dispute centers on whether remote workers can be considered part of a “single site of employment” that closed or experienced a mass layoff—terms that define whether the WARN Act’s notice requirements kick in. 2. Are WARN Act Damages Considered “Wages”? The Plaintiffs also brought state wage claims, arguing that the pay they would have received with proper WARN Act notice should be considered unpaid “wages” under Washington law and Ohio law. What the Court Decided: Judge Kymberly K. Evanson rejected the company’s motion to dismiss the case. Finding that Zulily’s argument that remote employees do not work at a single site with 50 or more workers and thus aren’t covered, was a factual question not suitable for early dismissal. Prior cases support the idea that even home-based employees may be “affected employees” if tied to a central worksite that shuts down. The court also found that if the WARN Act applies, then the Plaintiffs could plausibly claim that Zulily withheld “wages” owed under Washington and Ohio laws —opening the door to potential double damages and attorney fees. The Plaintiffs haven’t won their case; the court’s refusal to dismiss the claims allows them to move forward to discovery and potentially class certification. If they succeed, the case could set a precedent requiring companies to treat remote employees as part of larger employment sites for WARN Act purposes. With remote work here to stay, courts—and employers—will need to grapple with what "site of employment" really means in the 21st-century workforce. For employers, the message is clear: remote doesn't mean exempt. As the legal framework catches up with modern work arrangements, companies must tread carefully when making large-scale employment decisions. If your business has any questions on this topic or any other matters, please do not hesitate to contact the attorneys at The Royal Law Firm at 413-586-2288.