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Texas Judge Blocks Overtime Rule

On November 22, 2016, just days prior to President Obama’s initiative seeking to expand overtime wage protections to 4.2 million workers was set to take effect, Texas District Judge Amos L. Mazzant III issued a nationwide injunction blocking the overtime rule from going forward. The injunction means that, at least temporarily, the Department of Labor is halted from its bid to double the salary level at which otherwise exempt workers are required to receive overtime, from $23,660 to $47,476. The key statement from Judge Mazzant’s 20-page ruling is the following: To be exempt from overtime, the regulations require an employee to (1) have [executive, administrative or professional] duties; (2) be paid on a salary basis; and (3) meet a minimum salary level. . . . The salary level was purposefully set low to “screen[] out the obviously nonexempt employees making an analysis of duties in such cases unnecessary.” . . . But this significant increase to the salary level creates essentially a de facto salary-only test. While Maryland employers should view this unexpected ruling as a victory, it also has the potential to create new complications for employers who took action in anticipation of the new law taking effect on December 1, 2016. For example, if an employer already notified employees of salary raises or of being changed to non-exempt status, employers must now be cognizant of both morale implications and potential breach of contract claims prior to reversing those decisions. These matters must be carefully assessed and employers should obtain legal guidance prior to making any further changes. Ultimately, the takeaway from this latest FLSA development is that employers must continue to remain vigilant with regard to all wage and hour issues. While, for the moment, employers no longer need to reassess FLSA classifications based strictly upon salary, it still remains an excellent opportunity to perform further classification analysis with regard to employee job duties and other FLSA issues. Routine audits of employee classifications are the only effective way employers can remain FLSA compliant and minimize their exposure to costly litigation.

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Bruce Luchansky Nov 23 No Comments

Supreme Court Denies Review in ADA Obesity Case

Recently, in Morriss v. BNSF Ry. Co., U.S., No. 16-233, cert. denied Oct. 3, 2016, the U.S. Supreme Court declined to review a rejected job applicant’s claim that morbid obesity should be covered as an impairment under the Americans with Disabilities Act (the “ADA”). Melvin Morriss, a 285-pound worker denied a machinist job by BNSF Railway Co., sought review of a decision that the ADA does not cover obesity unless the condition is linked to an underlying physiological disorder. The Equal Employment Opportunity Commission in an appeals court brief had supported Morriss’ contention that morbid obesity, without more, is covered by the ADA. But the Supreme Court without comment declined to take up the ADA coverage issue. In seeking review, Morriss said under the ADA Amendments Act, which broadened the act’s definition of covered conditions, morbid obesity should be deemed an “actual or perceived impairment” regardless of whether it is linked to another physiological condition. The ADA, as amended in 2008, broadly protects workers who are “regarded as disabled,” either because of an actual or perceived impairment. The Eighth Circuit is the first appeals court to discuss morbid obesity under the ADA since the law was amended to broaden protections for workers with disabilities. The U.S. Court of Appeals for the First Circuit in a Rehabilitation Act case said morbid obesity is a physiological disorder involving the metabolic and neurological systems. The First Circuit also said regardless of the cause of an individual’s obesity, a defendant that acts as if obesity affects the individual’s bodily system has “perceived” the individual as impaired. The justices refused to grant review to resolve the conflict between the First Circuit’s reading of the Rehabilitation Act, which shares its definitions with the ADA, and the Eighth Circuit’s holding that the ADA doesn’t cover morbid obesity on its own. Notably, the Supreme Court has not construed the ADA’s definition of disability since the act was amended.

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Bruce Luchansky Nov 11 No Comments

Attorneys’ Fees Recovered in Recent NLRB Case

The U.S. Court of Appeals for the District of Columbia recently ordered The National Labor Relations Board (“NLRB”) to reimburse an employer for attorneys’ fees it incurred in successfully challenging an Unfair Labor Practice ruling. The Court held that the NLRB engaged in “bad faith litigation.” The NLRB had originally found that the employer, a Michigan health care provider, unlawfully refused to bargain to reduce employee work hours. The Court held that legal precedent clearly showed the employer had no such obligation. Therefore, the Court refused to enforce the NLRB’s order, and the employer filed a motion for attorneys’ fees, which the NLRB opposed. The Court said that the NLRB’s tactics forced the employer to waste time and resources fighting for a freedom the NLRB knew our legal precedent would provide. Calling the NLRB’s conduct “a stubborn refusal to recognize any law,” the Court approved the employer’s request for reimbursement of $17,649 in attorneys’ fees. If you are embroiled in litigation with the NLRB, contact the experienced attorneys at Luchansky Law today.

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Bruce Luchansky Oct 23 No Comments

Baseball: Hot Dogs, Soda, T-Shirts and the FLSA

Hot Dogs, Soda and T-Shirts.   Or, as the U.S. Court of Appeals for the Second Circuit recently put it, “food, beverages and merchandise.” The Court recently held that Delaware North Companies Sportservice Inc. (“DNC”), which sells food, beverages and merchandise inside Oriole Park at Camden Yards, is covered by a Fair Labor Standards Act exemption for businesses engaged in amusement or recreational activities on a seasonal basis. The company doesn’t directly provide amusement or recreation, but its primary purpose is selling goods and services to enhance spectators’ experience during Baltimore Orioles games. Employees of DNC filed a lawsuit saying the company didn’t pay overtime when they worked more than 40 hours in a week. The Court’s ruling means that exemption from overtime still applies if an amusement or recreation facility contracts out some of its operations.  DNC qualifies for the amusement or recreation exemption because it operates under a concession agreement with a business that qualifies for the exemption. In addition to compliance audits and counsel, the employment attorneys at Luchansky Law are experienced litigators.  If you are in need of counsel or litigation representation, contact our firm today.

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Bruce Luchansky Oct 12 No Comments

New Montgomery County Sick Leave Law

Montgomery County recently passed a new law regarding “earned sick and safe leave” effective October 1, 2016. The theme of the new law is “broad.”  That is, because most of its terms are defined very broadly. For example, the new law defines an Employer as: Any person, individual, proprietorship, partnership, joint venture, corporation, limited liability company, trust, association, or other entity operating and doing business in the County that employs 1 or more persons in the County in addition to the owners. Employer includes the County government, but does not include the United States, any State, or any other local government. A “Family member” means: A biological child, adopted child, foster child, or stepchild of the employee;  a child for whom the employee has legal or physical custody or guardianship; a child for whom the employee is the primary caregiver; a biological parent, adoptive parent, foster parent, or stepparent of the employee or the employee’s spouse; the legal guardian of the employee; an individual who served as the primary caregiver of the employee when the employee was a minor; the spouse of the employee; grandparent of the employee; the spouse of a grandparent of the employee; a grandchild of the employee; a biological, adopted, or foster sibling of the employee; or the spouse of a biological, adopted, or foster sibling of the employee. Regarding the substantive item in the law, the new law states, “An employer must provide each employee earned sick and safe leave for work performed in the County paid at the same rate and with the same benefits as the employee normally earns.” It should be noted that tipped employees must be paid at least the County minimum wage for each hour the employee uses earned sick and safe leave. An employer with fewer than 5 employees must provide each employee with both paid and unpaid sick and safe leave for work performed in the County.  An employee must accrue paid leave before accruing unpaid leave in a calendar year. The law provides for different “rates of accrual” depending on how many employees are employed by the Employer, and also provides options for how Employers can issue the leave. Predictably, the law states that retaliation is prohibited. Finally, the use of the leave is also defined broadly: “Earned sick and safe leave means paid leave away from work that is provided by an employer and can be used for the following purposes:  (1) to care for or treat the employee’s mental or physical illness, injury, or condition;  (2) to obtain preventive medical care for the employee or the employee’s family member;  (3) to care for a family member with a mental or physical illness, injury, or condition;  (4) if the employer’s place of business has closed by order of a public official due to a public health emergency;  (5) if the school or child care center for the employee’s family member is closed by order of a public official due to a public health emergency;  (6) to care for a family member if a health official or health care provider has determined that the family member’s presence in the community would jeopardize the health of others because of the family member’s exposure to a communicable disease; or  (7) if the absence from work is due to domestic violence, sexual assault, or stalking committed against the employee or the employee’s family member and the leave is used:       (A) by the employee to obtain for the employee or the employee’s family;            (i) medical attention needed to recover from a physical or psychological injury due to domestic violence, sexual assault, or stalking;            (ii) services from a victim services organization related to the domestic violence, sexual assault, or stalking;            (iii) legal services, including preparing for or participating in a civil or criminal proceeding related to the             domestic violence, sexual assault, or stalking; or       (B) during the time that the employee has temporarily relocated due to the domestic violence, sexual assault, or stalking.” Contact the employment attorneys at Luchansky Law to ensure you are in compliance with this new law.

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Bruce Luchansky Sep 22 No Comments

Upcoming Events

We are pleased to share with you the following Upcoming Events this month at Luchansky Law: On October 14, 2016, Bruce Luchansky and Judd Millman will be speaking at the Susquehanna Human Resources Association’s 5thAnnual HR Summit, which takes place at the Harford Community College.  Mr. Luchansky will be speaking about Dress Code Policies, and Mr. Millman will be speaking about Social Media Policies.  Please follow this link for more information, or if you wish to register to attend:  http://shra-network.com/news-upcoming-events/economic-update On October 20, 2016, Bruce Luchansky and Phil Romm, the firm’s Director of HR Services, will be speaking about the FLSA at the Baltimore County Chamber of Commerce Legislative Event. Please follow this link for more information:http://web.baltcountychamber.com/events/Legislative-Forum-with-Del-Christian-Miele-2194/details On Halloween, October 31, 2016, Bruce Luchansky will be giving a presentation to the Harford County Chapter of the Women’s Bar Association entitled, Nightmare on Main Street: Employment Law Essentials for the Small Law Firm. Download the flyer here: Halloween CLE Flyer

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Bruce Luchansky Sep 13 No Comments

United States Court of Appeals for the Fourth Circuit Issues Landmark Decision

The United States Court of Appeals for the Fourth Circuit recently issued a landmark decision regarding Government Contractors under the Fair Labor Standards Act (“FLSA”).   In Amaya v. Power Design, Inc., No. 15-1691, 2016 WL 4269801 (4th Cir. Aug. 15, 2016), the plaintiffs were 23 electrical construction workers who performed work on the Bethesda Navy Exchange.    The subcontract expressly incorporated the Davis–Bacon Act (DBA), and the Contract Work Hours and Safety Standards Act (CWHSSA).   The DBA applies to federal construction contracts valued over $2,000, and it requires contractors and subcontractors to pay their employees a “prevailing” wage set by the Secretary of Labor that consists of a “basic hourly rate of pay” and fringe benefits.    The CWHSSA applies to “any” federally funded or assisted construction contracts and subcontracts for public works that are valued over $100,000, and requires contractors and subcontractors to pay their employees time and one-half their “basic rate of pay” for all hours worked over forty each week.   Neither the DBA nor the CWHSSA has an explicit private right of action.    The Amaya plaintiffs brought their case under the FLSA. The defendants argued that there is no private right of action under the DBA or CWHSSA, and therefore the plaintiffs could not bring suit for wages. The district court agreed, even though the plaintiffs did not bring any claims under either the DBA or CWHSSA, and granted summary judgment to the defendants.   On appeal, the United States Court of Appeals for the Fourth Circuit determined that there is no statutory conflict that would prevent the plaintiffs from bringing their wage claims under the FLSA, but that they could, and should, seek overtime wages at a rate consistent with what they should have, but didn’t earn for their DBA/CWHSSA-covered work.    That is, instead of using the actual regular rate of pay for calculating FLSA overtime, the Court of Appeals allowed using the higher prevailing wage rates from the DBA/CWHSSA, consistent with Department of Labor Regulations.   This is a tremendous opinion that rewrites the laws for Government Contractors under the FLSA.   All employers handling government contracts, particularly in construction, must immediately be aware of this crucial development in the law. 

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Bruce Luchansky Aug 26 No Comments

Recent Court Decision Discusses Employers’ Potential Defenses to the FLSA

The United States Court of Appeals for the Fourth Circuit recently affirmed a judgment finding an employer’s violations of the Fair Labor Standards Act (“FLSA”). McFeeley v. Jackson St. Entm’t, LLC, 825 F.3d 235 (4th Cir. 2016). The Court discussed a potential defense to an FLSA claim, where employers may seek to show that they acted in “good faith” and “had reasonable grounds for believing that their act or omission was not a violation” of the FLSA. Citing to the FLSA, 29 U.S.C. § 260.  The relevant facts are as follows. In September 2011, the defendant, an owner of two dance clubs, consulted an attorney in response to a lawsuit by dancers claiming to be employees rather than independent contractors. The attorney advised the owner to require all dancers to sign agreements designating themselves independent contractors and acknowledging the reasons therefor. The district court found, and the Court of Appeals affirmed, the owner’s reliance on the attorney’s advice from that point onward to constitute good faith and reasonable belief of compliance with the FLSA. The defendant also tried to claim the good faith defense for the period prior to September 2011. When the defendant took over management of the first and second dance clubs in 2007 and 2009, he changed nothing about the way they had been operated. Since the dancers had always been classified as independent contractors, the new owner assumed that classification was appropriate. He made no effort to look into the law or seek legal advice until he faced a lawsuit in September 2011. The Court noted, “If mere assumption amounted to good faith and reasonable belief of compliance, no employer would have any incentive to educate itself and proactively conform to governing labor law.” Takeaways: Consult with an employment attorney immediately to determine whether you are in compliance with the FLSA.  Courts will look to the date you first sought advice of counsel to establish good faith and reasonable belief of compliance with the FLSA. If you’ve taken over a business DO NOT assume the existing practices are compliant. Mere assumptions do not amount to good faith and reasonable belief of compliance. Consult with an employment attorney right away.  In addition to compliance audits and counsel, the employment attorneys at Luchansky Law are experienced litigators. If you are in need of counsel or litigation representation, contact our firm today.

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Bruce Luchansky Aug 8 No Comments

National Labor Relations Board Files Complaint on Behalf of Employee’s Facebook Posts

In this article, we continue our analysis of Protected Concerted Activity in Non-Union Workplaces.  In a case before the National Labor Relations Board (NLRB), the employee, Dawnmarie, was a long-term paramedic for American Medical Response of Connecticut, Inc., an emergency medical service provider in New Haven, Connecticut.  After a verbal disagreement with her supervisor at work, Dawnmarie went home and posted a negative comment about her supervisor on her private Facebook page.  Dawnmarie’s post prompted replies from other employees who were friends with Dawnmarie on Facebook. Dawnmarie was suspended the next day and ultimately fired.  In making the decision to fire her, the company relied, in part, on Dawnmarie’s Facebook post, arguing that Dawnmarie violated the company’s internet policy when she criticized her supervisor online.  A charge was filed with the Hartford NLRB Regional Office alleging Dawnmarie was unlawfully fired.  The charge also alleged the company’s handbook contained unlawful provisions which, among other things, prohibited employees from making negative comments about the company or supervisors. After an investigation, the NLRB issued a Complaint alleging Dawnmarie was unlawfully fired because she engaged in protected concerted activity when she criticized her supervisor on Facebook.  The Complaint also alleged that the company’s handbook contained several unlawful provisions.  Prior to a hearing, the company agreed to revise the provisions in the handbook which were alleged to be unlawful.  The company also reached a private settlement with Dawnmarie regarding her termination.   Takeaway:  Employers must be aware of what constitutes Protected Concerted Activity in Non-Union Workplaces.  Additionally, employers must ensure their handbooks are in compliance with all applicable laws. The experienced employment and labor attorneys at Luchansky Law can train your supervisors to be knowledgeable of Protected Concerted Activity in Non-Union Workplaces.  We also offer audits of employee handbooks.  Contact our office today to ensure your handbooks are in compliance with the National Labor Relations Act and other applicable laws.

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Bruce Luchansky Jul 21 No Comments

National Labor Relations Board Holds Preemptive Termination Unlawful

In this article, we continue our analysis of Protected Concerted Activity in Non-Union Workplaces. In a case before the National Labor Relations Board (NLRB), the employer was a multinational, life sciences consulting firm that conducted clinical trials on behalf of its pharmaceutical clients at its Baltimore, Maryland location.  Its staff included a number of individuals from South Africa. When the charging party, Theresa, a licensed practical nurse for the company, received information from a co-worker that led her to believe that the employees from South Africa were receiving special treatment, she complained to her direct supervisor.  The next day, Theresa was called into the office by a Human Resources official and the Manager of Clinical Operations, who is also from South Africa, to discuss the “rumor” she had mentioned. In the meeting, Theresa explained that a co-worker, who was South African, told her that he received a raise when he was re-hired by the company and that his wife would also receive a raise when she was re-hired.  Theresa expressed concern that the company was paying the employees from South Africa higher wages and the manager of clinical operations would continue favoring these employees.  Theresa was then asked if she had discussed the conversation she had with her co-worker with anyone else besides her supervisor.  Theresa said she had not.  The next week, Theresa was fired. Theresa filed a charge about her termination with the NLRB’s Regional Office in Baltimore. After an investigation, a Complaint issued and a hearing was held on the matter. The judge’s decision was reviewed by the Board in Washington, D.C., which found the termination unlawful, as the evidence indicated the company fired Theresa as a way to prevent her from discussing her concerns of favoritism with her co-workers. The Board held that a “pre-emptive” termination to keep an employee from discussing wages, hours, or working conditions with other employees is unlawful, even if the employee had not yet engaged in protected activity. As part of its decision, the Board ordered that Theresa be reinstated with full backpay. The employer appealed the Board decision to the U.S. Court of Appeals for the District of Columbia, which appointed a mediator to the case.  With the mediator’s help, the parties reached a settlement under which the employer agreed not to discharge employees to prevent them from engaging in protected concerted activities and to pay Theresa around $250,000 for back wages and medical expenses.  In the agreement, Theresa declined reinstatement. Takeaway: It is imperative that employers ensure their termination policies are in compliance with all applicable laws. Contact the experienced employment and labor attorneys at Luchansky Law today to ensure your company’s termination policies are in compliance with the National Labor Relations Act and other applicable laws.

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Bruce Luchansky Jul 9 No Comments

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