Category: Uncategorized

NAIL SALON WORKERS FILED A CLASS ACTION LAWSUIT AGAINST ENVY NAILS FOR FAILURE TO PAY MINIMUM WAGE AND SPYING

Manicurists have filed a class action complaint again Anna Do, owner of Envy Salon, in a Manhattan Federal Court.  Do is the owner of more than 50 nail salons in Manhattan, Queens, Brooklyn and the Bronx.

Plaintiffs allege that Do fails to pay her employees less than minimum wage and sometimes as little as $5.00 per day.  They are paid off the books, and even with tips, Plaintiffs claim that they are paid less than what is required under the law.  Plaintiffs state that most of the workers at Envy Salon have recently arrived from Mexico and Ecuador and are taken advantage of by Do.  When visited by government inspectors, Do also instructs the workers to falsely identify themselves as independent contractors, as opposed to employees.  These practices are common in the manicure and salon industry because the owners can take advantage of recent immigrants and non-English speaking employees.

This firm will continue to monitor further developments in this case.

DOMINO’S PIZZA FINED BY ATTORNEY GENERAL FOR IMPROPER PAY PRACTICES

New York Attorney General Eric Schneiderman recently announced a $448,000 settlement with six Domino’s pizza franchisees operating in New York.  The business owners paid workers less than the $5.65 per hour tipped minimum wage and failed to pay adequate overtime, thereby violating wage and hour laws.  Specifically, delivery drivers were inadequately paid for their work, some receiving only $5.00 per hour, and workers who used their cars to deliver pizza were not reimbursed for their expenses.

  Moreover, employees were shifted from one store to another just before they were to reach 40 hours worked, and a manual override or a system flaw in the timekeeping system prevented an accurate calculation of the overtime worked. The settlement money will be dispersed among approximately 750 employees.

The Attorney General is also investigating Papa John’s franchisees.

ARE BACKGROUND CHECKS RACIAL BARRIERS IN THE HIRING PROCESS?

The Federal Trade Commission (“FTC”) and the Equal Employment Opportunity Commission (“EEOC”) agree that background checks could have a “disparate impact” on black job applicants. 

The doctrine of disparate impact is applied in the employment context and occurs when an employment policy is racially-neutral on its face, but has the effect of discriminating against members of a minority group.  The FTC and EEOC have released new compliance guidelines, which advise employers to be careful when basing employment decisions on background problems that may be more prevalent among a certain race.

  The EEOC has stated that African Americans are far more likely to have a criminal record, which in turn, may exclude them from job offers after employers conduct background checks.  In 2011, the NAACP lobbied the EEOC to apply the disparate impact analysis to background checks and compelled employers to eliminate questions about felonies on job applications.  Months later, the EEOC issued an enforcement guidance on the issue and recommended that employers not ask about convictions on job applications.  The EEOC warned employers that it could “investigate disparate impact charges challenging criminal-record exclusions of black job candidates.” 

PRESIDENT OBAMA ISSUES EXECUTIVE ORDER REGARDING EXPANSION OF OVERTIME PAY

On March 13, 2014, President Obama issued an executive order requesting that the U.S. Labor Department issue regulations that mandate overtime pay to employees who otherwise would be exempt under the federal Fair Labor Standards Act (“FLSA”).  The administration hopes to qualify employees, such as fast-food managers, office workers and other employees that are currently classified as exempt white-collar employees, for overtime pay under the FLSA.  Generally, these workers are exempt from the overtime requirements of the FLSA because they are deemed to be “administrative, executive or professionals.”

The proposed changes will likely be subject to public comment before final approval by the Labor Department, and may result in modifications of the original proposal.

NYC SETTLES LAWSUIT AGAINST FIRE DEPARTMENT FOR $98 MILLION DOLLARS

 Last week, New York City Mayor Bill de Blasio announced a settlement to pay $98 million in back pay, including $6 million in medical benefits, to those who have filed claims against the New York City Fire Department on grounds of racial bias.  As part of the settlement, the fire department also agreed to create the position of chief of diversity, who will report directly to the fire commissioner, and a diversity advocate who will monitor hiring practices and training for discrimination.

For years, civil rights groups have advocated on behalf of minorities whose efforts to join the fire department have been unsuccessful due to institutional biases.  Civil rights groups have argued that the entrance exams used by the fire department were biased against minority applicants.  Judge Nicholas G. Garaufis of the Federal Court in Brooklyn, N.Y. ruled that the entrance examination was indeed a violation of civil rights laws and the U.S. Constitution.  As such, he ordered the creation of a new exam and reforms in hiring practices, which were overseen by a court-appointed monitor.  Although Judge Garaufis’ ruling was appealed, the City did not dispute the ruling that the entrance exam was discriminatory, but rather, it challenged the notion that the discrimination was intentional.

As litigation continued, however, a new exam was designed, the fire department increased recruiting in minority neighborhoods and implemented special training sessions for new recruits.  From 2002 to 2013, the percentage of minorities in the department grew from 8 percent to 16 percent, and in December, the most-racially diverse class in the history of the fire department graduated from the fire academy.

MCDONALD’S BECOMES THE SUBJECT OF WAGE AND HOUR LAWSUITS IN NEW YORK, CALIFORNIA AND MICHIGAN

Last week, several McDonald’s employees filed lawsuits in New York, California and Michigan alleging that McDonald’s and its franchise owners have unlawfully underpaid them by not paying overtime, manipulating time-cards and ordering them to work “off the clock.”  Specifically, the Michigan plaintiffs claim that they were unlawfully required to pay for uniforms and were improperly told to show up to work, but then ordered to wait an hour or longer, without pay, until more customers arrived.   Workers in California cited to improper pay practices such as failing to pay for all hours worked, reducing hours worked from pay records and denying workers meal periods and rest breaks.  Lastly, the New York plaintiffs claim they were not reimbursed for the cost of cleaning their uniforms. 

This firm will continue to monitor the developments in these cases.

CHICKIE’S AND PETE’S TO PAY $6.8 MILLION FOR VIOLATING WAGE AND HOUR LAWS

Chickie’s and Pete’s, a prominent sports bar with 9 locations throughout New Jersey and Philadelphia, has recently agreed to pay $6.8 million in back wages and damages for taking tips from bartenders and waiters and for violating federal minimum wage and overtime laws.  The U.S. Department of Labor conducted a year long investigation and found that Chickie’s and Pete’s illegally underpaid and took tips from 1,159 servers and improperly retained 60% of the monies from the staff members’ tip pool, which was known as “Pete’s Tax.” 

 Separately, Chickie’s and Pete’s also announced that it agreed to pay an additional $1.68 million to settle a wage and hour claim commenced by 90 current and former employees.  As part of the settlement, Chickie’s and Pete’s also agreed to train all employees regarding their rights under the wage law and operation of tip pools and agreed to compliance monitoring for 18 months. 

The Department of Labor has described this case as one of the largest cases ever brought against an employer for violating tip-credit laws.

IS YOUR NON-COMPETE OR NON-SOLICITATION AGREEMENT ENFORCEABLE?

Non-compete and non-solicitation agreements may be contained in employment contracts or may be a separate agreement between an employee and employer.  Each state has its own distinct laws about whether such types of agreements are enforceable.  New Jersey, along with many other states, have a strong public policy in support of an individual’s right to pursue one’s profession or livelihood, so courts will generally look to the reasonableness of the agreement to determine whether or not the agreement should be given effect.

A non-compete agreement is typically executed to protect an employer’s trade-secrets or to restrict an employee from working in a certain geographic area for a certain number of years after his/her employer has ended.  The trade secret protection is usually enforced against former employees who had access to sensitive business information. 

A trade secret is information that gives an employer a competitive advantage in the marketplace because it is not generally known to the public and cannot be readily learned by others.  A trade secret comes in many forms—it can be a formula, pattern, program, device, method, technique or process that an employer has created and kept a secret.  Thus, when an employee quits or is terminated, an employer may be concerned that they will use the information that they have learned at work at another job and may seek to enforce the non-compete agreement.

The work restriction protection of a non-compete agreement usually prevents an employee from working for a competitor in a certain geographic space for a period of time.  The geographic restriction typically concerns a range of miles, and the time restriction can range from as short as 6 months to as long as a few years.  If you are an IT consultant or another professional, such as a physician, for example, you should be mindful of the existence of a non-compete agreement which may be in place when you are transitioning to a new job because your employer may seek to stop you from taking the job.

Although a non-compete and a non-solicitation agreement are similar in that both types of agreements place restrictions on a former employee for a certain period of time, a non-solicitation agreement restrains an ex-employee from soliciting customers or employees of his or her former employer after employment has ended.   For example, if you are a high-grossing sales agent at Company X and have accepted a job offer from Company X’s competitor, Company Y, Company X may be able to take legal action against you if you e-mail, call or otherwise contact your old clients from Company X for business.

A non-compete and non-solicitation agreement will be enforced if it is reasonable. It may be held to be unreasonable, and therefore invalid, if it lasts for too long of a time, covers too large of a geographic area, is too broad in scope, does not cover information that requires legal protection (i.e., a trade secret), or causes an undue hardship on the worker.

If such an agreement is reasonable and a former employer seeks to enforce it, a court may order the employee to cease working at a particular job and the employee may be liable for monetary damages.  As such, it is important to seek the advice of an employment law attorney when entering into an employment contract containing such restrictions as well as when you are terminated or quit a job.

NEW JERSEY GOVERNOR CHRIS CHRISTIE SIGNS BILL PROHIBITING PREGNANCY-RELATED DISCRIMINATION IN THE WORKPLACE

The New Jersey legislature has noted that pregnant women can be vulnerable to discrimination in the workplace.  There have been reports that women who have requested an accommodation due to their pregnancy-related needs or issues have been unfairly denied reasonable accommodations or have been demoted, terminated or placed on unpaid leave.

Recognizing the pervasiveness of this discriminatory treatment in the workplace, on January 21, 2014, New Jersey Governor Chris Christie signed into law Bill No. S2995 (substituted for A4486), which amends the New Jersey Law Against Discrimination (“NJ LAD”).  Effective immediately, this amendment now prohibits workplace discrimination against women affected by pregnancy, childbirth, or related medical conditions.  The law specifies that women affected by pregnancy should not be treated in a manner less favorable than other persons not affected by pregnancy.

  Moreover, the bill requires that an employer provide a reasonable accommodation for pregnancy-related needs when requested by the employee with the advice of her physician.  The law contemplates accommodations such as bathroom breaks or breaks for increased water intakes, periodic rest, assistance with manual labor, job restructuring or modified work schedules, and temporary transfers to less strenuous or hazardous work.  Note however, that similar to the Americans with Disability Act (“ADA”), an employer will not be penalized for failing to provide an accommodation if the accommodation would cause the employer an undue hardship.

CONSTRUCTION COMPANY HIRED TO REBUILD SEASIDE HEIGHTS BOARDWALK FACING WAGE AND OVERTIME LAWSUIT

Jamali Developers LLC, the construction company hired to rebuild the iconic Seaside Heights boardwalk after the aftermath of Superstorm Sandy, has just been served with a lawsuit.  The suit names Jamali Developers’ CEO and managers as well as another company alleged to be related to Jamali Developers.  According to their complaints filed in the Superior Court of Middlesex County, carpenters, Fredy Beza and Angel Martinez, seek a representative action for workers under the New Jersey Prevailing Wage Act on grounds that Jamali Developers allegedly failed to pay workers the mandatory wage rate.  Alternatively, Plaintiffs seek a class action suit due to Jamali Developers alleged failure to pay overtime on the reconstruction project and thereby violating the federal Fair Labor Standards Act.  The Plaintiffs state that there may be over 75 workers entitled to such pay.

This firm will continue to monitor the developments in this case.