Category: Uncategorized

PANASONIC RESCINDS CONFIDENTIALITY RULES

The National Labor Relations Board (NLRB) recently approved an agreement between the National Employment Lawyers Association (NELA), an organization that exclusively represents employees involving employment-related matters, and Panasonic Corporation of North America regarding the Company’s confidentiality rules.

The Company agreed to rescind its policies restricting employees’ ability to communicate with others about their working conditions and other protected activity.  Specifically, the policies had interfered with employees’ rights to communicate about workplace grievances, seek legal advice or engage in other concerted activity, which violates the National Labor Relations Act (NLRA).  The Company also was required to post notices, that must be visible for 60 days in all of Panasonic’s Newark, New Jersey locations, that states that the Company “will not maintain or enforce language” in its employee handbook or other policies.

Claudia Reis, president of NELA’s New Jersey division, said in a statement, “By negotiating the settlement on behalf of NELA-NJ, the NLRB has sent a clear message to employers that it will enforce the protections of the [NLRA] that allow employees to discuss working conditions, and to advance their interests as employees, without unlawful interference from employers through sweeping confidentiality policies.”

BORGATA’S DRESS AND GROOMING RULES FOR SERVERS RULED NON-DISCRIMINATORY

The New Jersey Court of Appeals ruled last week that the dress and grooming policies for cocktail servers, known as the “Borgata Babes,” at the Borgata Hotel Casino & Spa did not constitute sex discrimination under the New Jersey Law Against Discrimination. 

The lawsuit was brought by twenty-two women who alleged that the casino viewed them as sex objects and had policies which prohibited them from gaining more than seven percent of their body weight at the time of hiring.  The lower court held that the hiring process made clear that the positions were meant to be part-entertainer and part-cocktail waitress and the waitresses voluntarily agreed to the weight policy by signing agreements, which the judged ruled were reasonable and lawful.  The waitresses appealed.

  Last week, the New Jersey Court of Appeals affirmed the lower court’s decision, holding that Borgata’s personal appearance policy was lawful and non-discriminatory; however, the Court ruled that “…the enforcement of the weight policy was applied in a discriminatory harassing manner targeting women returning from maternity and medical leave” and therefore remanded the case back to the lower court on that issue.

The full decision can be read here.

SPLIT RULING IN NURSE’S DISABILITY DISCRIMINATION CLAIM

Plaintiff Maryanne Grande worked for Saint Clare’s Health System for 10 years before she was terminated.  During her tenure at the hospital, Grande injured herself while caring for patients on four separate occasions.

Her most recent injury was a neck injury that was incurred while she was attempting to prevent a patient from falling.  As a result of her injury, Grande took FMLA leave, underwent surgery and also received workers compensation benefits.  Her physician initially authorized her to return to work on “light duty” but later issued Grande a certificate to return to work full time, with certain restrictions, which the hospital was aware of.  When the certificate was issued, Grande was informed that she was being terminated because the hospital would not be able to accommodate the restrictions she required.  After she was terminated, Grande met with her physician who issued her an amended certificate allowing her to return to work with no restrictions, full-time.  However, the hospital refused to reverse its decision to terminate her employment.  Grande filed suit against the hospital for disability discrimination under the New Jersey Law Against Discrimination, alleging she was unlawfully terminated because of her disability and perceived disability.

On summary judgment, the lower court judge ruled that Grande could not establish a prima facie case for disability discrimination because she was not physically able to perform the essential duties of her job as a nurse and that defendant-hospital had a legitimate, non-discriminatory reason to terminate plaintiff.  Plaintiff appealed to the New Jersey Appellate Division.  In a 2-1 decision, the Appellate Division ruled in plaintiff’s favor and held that Grande presented evidence that she is fully capable of performing the essential duties of her job and had not requested an accommodation.  The court held that a jury should evaluate the evidence and reach a verdict on the matter.  As such, the case was reversed and remanded for further proceedings.

The full decision can be read here.

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

SECOND CIRCUIT RULES THAT FLSA SETTLEMENTS MUST BE APPROVED BY COURT OR U.S. DEPARTMENT OF LABOR

In Cheeks v. Freeport Pancakes House, Inc., a server/manager sued his former employer for unpaid overtime wages, liquidated damages and attorneys’ fees under the Fair Labor Standards Act and New York labor laws.  After engaging in some discovery, the parties agreed on a private settlement and jointly filed a stipulation to dismiss the case with prejudice.  The district court did not accept the stipulation, stating that plaintiff could not agree to a private settlement of his FLSA claims without court approval or the supervision of the Department of Labor.  The parties did not wish to disclose the terms of their settlement, thus, asked the Second Circuit Court of Appeals to determine whether parties may settle FLSA claims without court approval or Department of Labor supervision.  District courts had previously been split on this issue.

The Second Circuit affirmed the district court’s decision and ruled that due to the unique policy considerations underlying the FLSA, settlement agreements in FLSA suits must be approved by the court or the Department of Labor to take effect. The Second Circuit reasoned that approval in FLSA cases are necessary due to the potential for abuse in settlement agreements, such as the inclusion of overbroad waivers and high attorneys’ fees.  The Court described the FLSA as being a uniquely protective statue, with a “…primary remedial purpose:  to prevent abuses by unscrupulous employers and remedy the disparate bargaining power between employers and employees.”  Now, in light of this decision, settlement agreements in the Second Circuit must be filed in court, for approval.

The full decision can be read here.

HOME HEALTH CARE WORKERS NOW ELIGIBLE FOR MINIMUM WAGE AND OVERTIME PAY

Home health care workers provide in-home care for the elderly and disabled.  These workers often work long hours under stressful conditions, and for 40 years, have been classified as exempt under the Fair Labor Standards Act’s “companionship” exemption.  President Barack Obama has long advocated for the increase in wages as well as minimum wage and overtime protections for these home health care workers.  In recent years, the Obama administration drew up regulations to extend these protections to over two million home health care workers, but the regulations were struck down by a lower court earlier this year.

Last Friday, however, a three-judge appellate court in Washington D.C. ruled that the Labor Department has the authority to eliminate the companionship exemption, thus making home health care workers eligible for minimum wage and overtime pay.  These protections would expand to home health care workers who are employed by third-party staffing agencies.  Home health care industry officials are reportedly reviewing this decision and considering their options, including Supreme Court review.

GOVERNOR ANDREW CUOMO REQUIRES NAIL SALON OWNERS TO SECURE BONDS

As we previously posted, Governor Andrew Cuomo recently instituted new measures to protect nail salon workers and educate employers in New York.  The new legislation and regulations aim to crack down on the exploitation of workers in the nail salon industry.  In his latest effort to remedy abuse and unlawful practices in this industry, nail salon owners will now be required to secure wage bonds by October 6, 2015 or otherwise face fines and penalties such as the possible closing of their businesses.  Salon owners would be able to use the bonds to pay for judgments against them in wage-theft cases.  The size of the bond that nail salon owners will be required to secure will depend on the number of employees at the business and the number of hours they work.

The securing of wage bonds is important because it has become commonplace for nail salon owners to claim that they do not have the means to pay judgments against them in wage-theft cases, yet would take steps to hide their assets.  For instance, in 2012, manicurists at Babi, a Long Island chain, were awarded nearly a $500,000 judgment, but only have collected some $100,000.  The chain’s owner claimed to not have the money to pay the judgment, but it was later found that he sold property worth several million dollars right before trial. This new requirement helps to combat situations like these.  Cuomo stated, “Requiring owners to secure a wage bond will help ensure workers are paid what they are legally owed and that businesses have the funds they need to meet their financial obligations.”

This Firm will continue to monitor developments in Governor Cuomo’s initiatives.

STAFFING FIRM’S NON-COMPETE AGREEMENTS HELD UNENFORCEABLE

The Seventh Circuit affirmed that a Chicago-based information technology staffing firm’s non-compete agreements were unenforceable.  The Company, Instant Technology LLC, sued four former employees and its former Vice President for Sales and Operations, Elizabeth DeFazio, for joining a competitor firm, Connect Search LLC, which she was co-founding.  Connect Search also won business from Instant Technology’s recent clients.

  Instant Technology brought suit against these former employees for poaching employees, soliciting clients and divulging proprietary information to Connect Search.  The district court found that there was no evidence showing that defendants misused proprietary information.  Although the Defendants admitted breaching the covenants not to solicit and not to recruit, the district court held that those provisions in Instant Technology’s agreement were unreasonable and unenforceable under the Illinois Supreme Court case, Reliable Fire Equipment v. Arredondo, which held that a restrictive covenant is only valid if it serves a legitimate business interest.  The district court ruled that the covenants did not service a legitimate business interest because Instant Technology did not have permanent relationships with its customers and the former employees did not acquire confidential information during their employment.

Instant Technology argued before the Seventh Circuit that the district court used the wrong analysis, and that a “totality of circumstances” analysis should have been used to determine whether the covenants were unreasonable.  However, the Seventh Circuit rejected that argument.  The Court reasoned, “[Instant Technology] thinks “totality of the circumstances” means “all of the circumstances”…That’s an understandable reading given the slippery formulation, but it cannot be correct. ‘All’ circumstances is a lot of circumstances—indeed, infinitely many. Few matter to the question whether a restrictive covenant is reasonable, and even fewer matter enough that it would be a reversible error for the district court to omit them from its findings. The court didn’t discuss the price of eggs in Guatemala, but that does not require a remand.”

The Court further stated that if the validity of restrictive covenants, like non-compete agreements, depended on the “totality of the circumstances” then it would be hard to predict what covenants would be enforceable, which in turn, may cause both employers and employees to be worse off.

The full decision can be read here.

NEW JERSEY SUPREME COURT EXPANDS EMPLOYER LIABILITY IN “WATCHDOG” EMPLOYEE WHISTLEBLOWER CASE

Earlier this month, the New Jersey Supreme Court ruled in Lippman v. Ethicon that workers whose job entails monitoring whether their employers are complying with certain rules, regulations and standards, sometimes called “watchdog” employees, are entitled to whistleblower protection under the Conscientious Employee Protection Act  (“CEPA”).  CEPA is a comprehensive state law that protects employees from retaliation for reporting illegal activities or other activities that otherwise threaten the public’s safety, health or welfare or the environment.

In Lippman, Chief Medical Officer, Dr. Joel Lippman, brought suit against his former employer, Ethicon, a subsidiary of Johnson and Johnson, for retaliation for firing him for allegedly making complaints about certain drugs and medical devices and supporting recalls of dangerous products.  The Company argued that since raising these issues were part of Dr. Lippman’s “ordinary job responsibilities,” he could not show that he engaged in a “whistleblowing activity,” and therefore, he should not be protected under CEPA.    The trial court previously ruled in favor of Ethicon.  The Appellate Division reversed but ruled that watchdog employees, like Lippman, must exhaust all internal complaint processes before they can make a CEPA claim.  The New Jersey Supreme Court unanimously held that the plain language of the statute did not require an extra exhaustion requirement, and stated that watchdog employees are vulnerable to retaliation and state law “does not limit protection based on job title or function.”

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

JERSEY CITY COUNSEL PASSES WAGE THEFT ORDINANCE

The nine-member city council of Jersey City unanimously voted for the passing of an anti-wage theft ordinance which will protect workers from having their wages stolen by employers. If signed by the Mayor of Jersey City, the law would allow the city to revoke or suspend the business licenses of employers who are found to be in violation of state wage and hour laws. That is, employers who were found to have violated, for example, the minimum wage and overtime requirements mandated by state law, may be denied their business licenses under the law if they fail to pay their employees what they are owed.

Jersey City is the fifth city in New Jersey to adopt a wage theft law.

NEW YORK JUDGE GRANTS FOOD DELIVERY DRIVERS CONDITIONAL CERTIFICATION IN UNPAID WAGES SUIT

On March 5, 2015, a delivery driver for Lychee House, a Chinese restaurant located in Midtown Manhattan, filed a lawsuit against the Company for unpaid wages pursuant to the Fair Labor Standards Act and New York Labor Law.  Plaintiff, Yong Jie Li, and other drivers alleged that the restaurant failed to pay them and others similarly situated the proper overtime pay and “spread of hours” compensation.  Li stated that he worked at least 55 hours per week and received $201.00 per week.

This week, Judge Valerie Caproni of the U.S. District Court for the Southern District of New York, granted a preliminary certification of the class.  This allows the plaintiffs to continue to proceed with the case as a group and will also allow other current or former delivery drivers to join the lawsuit.

Delivery workers employed by restaurants frequently work long hours without being properly compensated.  Non-exempt delivery workers who work over 40 hours per week are entitled to overtime pay at a rate of one-and-one-half times their regular rate of pay.   Also, in New York, if a delivery driver or other non-exempt employee works over 10 hours per day, they are owed additional compensation. It is important to consult with a labor law attorney if you believe you are being denied the proper compensation for your work.