New Jersey Employment Lawyer Blog

New Jersey's Appellate Division recently recognized it can be unlawful for a company to reduce employees' overtime hours in response to an overtime lawsuit. Specifically, the case finds that such a policy could violate New Jersey's whistleblower law, the Conscientious Employee Protection Act (CEPA).

Howard Flecker III worked as a Deckhand for Statue Cruises, a company which provides ferry service from New York and New Jersey to Liberty Island and Ellis Island.Under the company's Collective Bargaining Agreement (CBA), employees were entitled to be paid time-and-a-half only after they worked more than 48 hours per week. The FLSA is a federal law which requires companies to pay "non-exempt" employees overtime pay at the rate of time-and-a-half when they work more than 40 hours per week

In 2009, Mr. Flecker filed a class action lawsuit claiming the CBA violates the Fair Labor Standards Act (FLSA). In direct response to Mr. Flecker's lawsuit, the company issued a memorandum indicating that none of its employees would work 40 hours per week. For example, the company reduced Mr. Flecker from 50 to 40 hours per week.

As a result, Mr. Flecker's coworkers lost 8 or more hours of pay per week. Many of his coworkers confronted him about this on a daily basis, and pressured him to withdraw his lawsuit. Mr. Flecker's lawyer told the company that its policy was a form of unlawful retaliation in violation of CEPA. The company responded that it was attempting to minimize the potential damages in Mr. Flecker's overtime lawsuit. Eventually, due to the stress caused by his co-workers' constant pressure to withdraw his lawsuit, he resigned. He also added a retaliation claim to his lawsuit under CEPA.

The trial court dismissed Mr. Flecker's CEPA claim, finding he had not alleged any retaliatory action. However, in Flecker v. Statue Cruises, LLC , the Appellate Division disagreed, and found two potential retaliatory actions. First, it ruled a jury could conclude the company's actions were intended to turn Mr. Flecker's co-workers on him, which in turn forced him to resign. In other words, a jury could conclude the company constructively discharged him. Second, it found reducing Mr. Flecker's hours because he filed an overtime lawsuit could violate CEPA if the company's motive was to retaliate against him for filing his lawsuit. The court explained this theory was supported by the fact that, although the company claimed it was going to reduce the hours of all of its employees, it did not reduce the hours of at least two of the employees who had been harassing Mr. Flecker.

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Late last month, the New Jersey Appellate Division ruled that ExxonMobil Research and Engineering Company may have violated New Jersey Law Against Discrimination (LAD) when it fired an employee suffering from alcoholism after she failed a breathalyzer test. The LAD prohibits employers from discriminating against employees because they are disabled. Since alcoholism is a disability, it is illegal to fire an employee because he is an alcoholic. However, the LAD permits employers to fire employees if their disabilities, such as alcoholism, prevent them from performing their jobs or create a serious health risk.

The case, A.D.P. v. ExxonMobil Research and Engineering Company, involves an employee who voluntarily informed her employer, ExxonMobil Research and Engineering Company, that she was an alcoholic and was checking herself into an inpatient rehabilitation program. Based on company policy, ExxonMobil required her to stop from using any alcohol and to undergo random breathalyzer tests for two years. The company did this even though the employee had an exceptional performance history, and there was no evidence she was ever intoxicated at work or that her drinking interfered with her job in any way. When the employee eventually failed a breathalyzer test, ExxonMobil fired her. She then sued, claiming the company committed disability discrimination, in violation of the LAD.

The Appellate Division found there was direct evidence of disability discrimination. Specifically, a manager admitted ExxonMobil required the random drug testing pursuant to company policy because the employee revealed she is an alcoholic, rather than because of anything relating to her job performance. The Court found this policy to be discriminatory since it shows hostility toward alcoholics. Given this direct evidence of discrimination, the court ruled that ExxonMobil has the burden to prove it would have fired the employee irrespective of her disability. Usually the employee has the burden to prove discrimination.

The Court explained that companies have the right to fire employees whose disabilities prevent them from adequately performing their jobs. However, to establish this defense, a company needs to prove the particular employee could not perform her job. In this case, the court found no evidence that the employee was unable to perform her job despite her alcoholism.

The Court also explained that companies can fire employees whose disabilities create a serious health risk. But to establish this defense the company needs to prove, with a reasonable degree of certainty, there is a probability the employee's disability will cause a substantial injury to the employee or someone else in the workplace. To meet this test the employer has to show more than the fact that the employee has a specific disability. It has to prove the disability was likely to pose a safety risk with respect to the particular employee.

For more information, please see our previous article, When Can A Private Company Require Random Drug Testing in New Jersey?

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As a result of Hurricane Sandy, many businesses in New York and New Jersey had to stop their operations for a considerable period of time. Now that many employees are returning back to work, they are asking whether they should be paid for the days when their offices were closed due to the storm.

The United States Department of Labor provides a clear answer to this question as it relates to employees who are "exempt" under the Fair Labor Standards Act (FLSA). An employee is generally considered exempt if he meets certain requirements regarding his job duties and is paid a salary of at least $455 per week ($23,660 per year based on a full time schedule). The most common exemptions are for employees employed in a bone fide executive, administrative, and professional capacities.

An employer may not withhold pay to an exempt employee because the office was closed as a result of the storm or another natural disaster without jeopardizing the employee's exempt status. In other words, if a company fails to pay an exempt employee his salary for the period he was unable to work during a natural disaster, then that employee might be entitled to overtime pay if he works more than 40 hours in a week. However, if the employee has accrued vacation or personal time, the employer can require the employee to use that time during his absence from work due to the storm.

As far as non-exempt employees, under the FLSA employers are required to pay them only for the hours they actually worked. Thus, unless they used paid time off, employees who are paid on an hourly basis and other non-exempt employees are not entitled to pay for the days they were unable to work because of the natural disaster. Of course, companies still have to pay employees if they are required to do so under an individual employment contract, a collective bargaining agreement, or a company policy.

Employees who became unemployed as a result of Hurricane Sandy may be eligible for Disaster Unemployment Assistance. The information about the requirements and the application process is available through the New Jersey Department of Labor and the New York Department of Labor.

Continue reading "What Compensation Is an Employee Entitled to if His Employer Was Affected By Hurricane Sandy?" »