New Jersey Employment Lawyer Blog

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?" »

Earlier this year, Novartis Pharmaceuticals Corporation agreed to a $99 million settlement of a class action overtime lawsuit brought by its sales representatives. The settlement is still subject to final approval by a judge. A final hearing to approve the settlement is scheduled for May 31, 2012. Novartis, an affiliate of Swiss drug maker Novartis AG, has its headquarters in East Hanover, New Jersey.

The overtime lawsuit against Novartis was filed in 2006 in a federal court in Manhattan. More than 7,000 current and former sales representatives joined the class action. They claim Novartis failed to pay them overtime, in violation of the Fair Labor Standard Act (FLSA). The FLSA is a federal law that requires companies to pay nonexempt employees time-and-a-half when they work more than 40 hours in a week.

Novartis settled the case before the United States Supreme Court could rule whether pharmaceutical companies are required to pay overtime to their salespeople in another similar lawsuit. Specifically, Christopher v. GlaxoSmithKline is an overtime lawsuit against GlaxoSmithKline which is currently on the Supreme Court's 2012 docket. The outcome of that case is likely to decide whether salespeople working for pharmaceutical companies are entitled to be paid time-and-a-half when they work overtime. The oral argument in Christopher is scheduled for April 16, 2012.

Companies often refuse to pay their employees overtime, either because they are unaware of the requirement, or because they do not realize the employee is entitled to it. But most employees, including both hourly and salaried employees, are entitled to overtime pay when they work more than 40 hours per week.

Continue reading "Novartis Settles Class Action Overtime Lawsuit for $99 Million" »

Earlier this year, a New Jersey Judge refused to file the terms of a settlement agreement in an overtime lawsuit under seal. Specifically, Judge Jose L. Linares of the United States District Court for the District of New Jersey ruled the employer had not overcome the strong presumption of public access to the terms of settlements in cases under the Fair Labor Standards Act ("FLSA"). The FLSA is a federal wage and hour law that requires employers to pay most "nonexempt" employees time-and-a-half when they work more than 40 hours in a work week.

The case, Brumley v. Camin Cargo Control, Inc., involved three separate collective action lawsuits against Camin Cargo Control, Inc. Between the three cases, 112 employees alleged Camin failed to properly pay them overtime wages in violation of the FLSA. Five of those employees also claimed the company retaliated against them in violation of the FLSA.

Last year, the parties agreed to settle the case for $3.9 million dollars, or an average of nearly $35,000 per plaintiff. As is typical in employment law cases, the Settlement Agreement included a confidentiality provision that required the parties to keep the terms of the settlement private. But since the FLSA required a judge to approve the settlement, the parties had to submit the Settlement Agreement to the Court for its approval. As a result, the employer filed a motion requesting permission to file the Settlement Agreement under seal.

But Judge Linares denied the defendant's motion to file the Settlement Agreement under seal. He explained that settlements under the FLSA are different from most other settlements. First, the public has an interest in seeing the terms of the settlement agreement so they can understand the reasons why the judge approved or rejected it. Second, the FLSA does not merely protect the rights of the individuals who bring claims under it. It also protects the separate public interest in "assuring that employees wages are fair and thus do not endanger 'the national health and well-being.'" As a result, he ruled there is a strong presumption that settlement agreements in FLSA cases should be publically available. He concluded that Camin failed to sufficiently rebut this presumption, and therefore denied its motion to file the settlement agreement under seal. You can view the Settlement Agreement here.

Continue reading "New Jersey Judge Refuses to Seal Settlement Agreement in Overtime Lawsuit" »

On March 22, 2011, the United States Supreme Court ruled that the Fair Labor Standards Act of 1938 ("FLSA") prohibits employers from retaliating against employees who make oral complaints about violations of the FLSA. The FLSA is a federal law that sets minimum wages, maximum hours, and overtime pay requirements. It includes an anti-retaliation provision which forbids employers from firing or otherwise discriminating against employees because they "filed any complaint" under the FLSA.

The case, Kasten v. Saint-Gobain Performance Plastics Corp., involves Kevin Kasten's lawsuit against his former employer, Saint-Gobain Performance Plastics Corporation. Mr. Kasten claimed Saint-Gobain fired him in retaliation for his verbal objections to the company's violation of the FLSA. Specifically, he repeatedly told his supervisor, several human resources representatives, and other Saint-Gobain officials that the company was violating the law by locating its time clocks in a place where employees could not get credit for the time they spent putting on and taking off their protective gear. In a separate lawsuit, Mr. Kasten proved that Saint-Gobain violated the FLSA because it was required to pay its employees for the time they spent "donning and doffing" their protective gear.

The Supreme Court found that Mr. Kasten is entitled to try to prove his retaliation case because "filing any complaint" under the FLSA can include making a verbal complaint to your employer. The Court noted that the word "filed" has different meanings in different contexts. Sometimes it implies something in writing, but in other contexts it can include verbal statements. It then considered that when Congress passed the FLSA, it recognized enforcement of the law was likely to depend on "information and complaints received from employees seeking to vindicate rights claimed to have been denied," and that the anti-retaliation provision was intended to encourage employee to come forward by preventing employers from silencing them through "fear of economic retaliation." Accordingly, the Court concluded that Congress did not intend to limit the FLSA's anti-retaliation protection to written complaints, since that would make it more difficult for illiterate, less educated, and overworked workers to complain. It also explained that limiting complaints to written complaints would prevent Government agencies from using hotlines, interviews, and other verbal complaint methods, and would discourage employees from using informal workplace grievance procedures.

However, the Supreme Court also recognized that it would not be fair to employers if the FLSA's anti-retaliation provision applied when the employer did not have fair notice that the employee made a complaint that could subject the company to a retaliation claim. It therefore ruled that an oral complaint must have enough formality that the employer either understood or reasonably should have understood that the complaint was a business concern. In other words, a complaint is "filed" when a reasonable person would have understood that the employee put the employer on notice that he was asserting a right under the FLSA.

Continue reading "U.S. Supreme Court Rules FLSA Forbids Retaliation Against Employees Who Make Oral Complaints" »

Last Wednesday, a mascot who worked for the Scranton/Wilkes-Barre Yankees minor league team filed a federal lawsuit claiming the team violated the Fair Labor Standards Act ("FLSA") and state law because it failed to pay him for his overtime hours. Specifically, Brian Bonnor's lawsuit alleges the team improperly designated him as a "manager" to avoid paying him time-and-a-half when he worked more than 40 hours in a week.

Specifically, Mr. Bonnor, who was laid off by the New York Yankees' AAA affiliate in January, alleges he was paid a salary of $22,000 per year to dress up as the team's mascot, Champ, and make appearances at games and other events. However, his lawsuit claims he had no supervisory or managerial job duties. He also claims he sometimes worked 80-hour weeks, but the team never paid him for his overtime. The team denies it violated the law.

The FLSA is a federal wage and hour law. It requires employers to pay most employees time-and-a-half for their overtime hours unless they fall into specifically defined categories, including certain "executive," "administrative," and "professional" employees. Companies that violate the FLSA can be required to pay the employee not only for their unpaid overtime, but if the violation is "willful" they also can be required to pay double damages (called "liquidated damages"). An employee who wins a case under the FLSA also can recover his attorney's fees and litigation costs.

Continue reading "Minor League Yankees Play Hardball with Mascot's Overtime Pay" »

Starting on January 1, 2011, New York employees in the Hotel and Restaurant Industries have new rights and legal protections under New York's Hospitality Wage Order. While there are numerous changes to the law, the following describes some of the more noteworthy changes.

Changes to Minimum Wage
The new law makes it clear that tipped employees must receive at least $7.25 per hour between salary and tips, and reduces the maximum tip credit for food service workers from $2.60 per hour to $2.25 per hour. It also sets new minimum base wages (before tips) for service employees and chambermaids in resort hotels.

Employees Must Be Paid By the Hour
Under the Wage Order, employers in the Hotel and Restaurant Industries now are required to pay non-exempt employees by the hour, rather than based on salaries, weekly rates, day rates, or piece rates. This requirement does not apply to commissioned salespeople.

Stricter Regulations of Tips
Employers and employees in the Hotel and Restaurant Industries are allowed to share and pool tips, meaning combine all of the tips received before redistributing them to employees. However, employers must give employees advance written notice of their tip sharing and tip pooling policies. Employers who use tip pooling or sharing also must keep records of all of the tips they receive, and all of the tips they distribute to their employees. In addition, employers also must treat any special fee for a banquet, special function or package deal as a tip unless they clearly inform customers that the fee is not a gratuity and will not be distributed to employees.

New Requirements For Employee Meal Breaks
When an employee in the Hotel and Restaurant Industries has a work shift that is long enough that he or she is legally entitled to a meal break, the employer must either allow employees to bring their own food, or offer employees a meal at a cost of no more than $2.50, which is the legally required meal credit. Under a separate law, New York State Labor Law Section 162, most employees in New York who work more than a six hour shift that starts before 11 am and ends after 2 pm are entitled to take at least a half hour lunch period between 11 am and 2 pm.

Effective Date
Although the law went into effect on January 1, 2011, employers have until February 28 to make changes to their payroll and bookkeeping systems. However, by the first regular payday after March 1, 2011 employers must pay employees based on the new rules retroactively to January 1, 2011.

Continue reading "New Rights For New York Hotel and Restaurant Employees" »

On December 13, 2010, New York State Governor David A. Paterson signed the Wage Theft Prevention Act ("WTPA") into law. The WTPA is intended to help protect employees working in New York against violations of their wage and hour law rights.

The WTPA requires employers to provide information to employees about how they are being paid. For example, employers must notify employees, in writing, of:

1. Their rate and basis for their pay, such as whether they are paid by the hour, shift, day, week, salary, piece, commission, or otherwise;
2. Any allowances the employer claims as part of the employee's minimum wage, such as tip, meal, or lodging allowances; and
3. Their overtime rate, number of regular hours worked, and number of overtime hours worked for employees who are not exempt from overtime.

Employers must provide this information to employees when they are hired, and no later than February of each year thereafter. The information must be in English and the employee's primary language other than English when applicable. Employers also are required to have employees sign and date an acknowledgment confirming they received this information each time they provide it to them.

In addition, the WTPA requires New York State employers to (1) notify employees in writing about changes to their rate and basis of pay, allowances for overtime, or overtime rate; (2) provide that information with each paycheck or other payment of wages; and (3) keep contemporaneous, true, and accurate payroll records containing all of that information for at least 6 years. It also expands the antiretaliation provisions of New York's wage and hour laws. For example, employers cannot retaliate against employees who object in good faith about activities that they reasonably believe violate the WPTA.

In a press release about the WTPA, Governor Paterson said he is "proud to sign this legislation, which will combat misconduct by unscrupulous employers who fail to pay statutorily-mandated minimum wages and overtime." Similarly, the policy co-director for the National Employment Law Project, Annette Bernhardt, recognized that:

By enacting this critical legislation, New York joins a growing number of states nationwide . . . that are ramping up the fight against wage theft. By stiffening the penalties, protecting workers who come forward, and ensuring that unpaid wages are collected, the new law provides the tools we need to ensure justice for the hundreds of thousands of workers in New York who are impacted each year.

The WTPA will go into effect on April 12, 2011.

Continue reading "New York Passes Wage Theft Protection Act" »

On January 22, 2009, the United States Senate voted to pass the Lilly Ledbetter Fair Pay Act of 2009. If into becomes law, the Act would reverse the United States Supreme Court's 2007 decision in Ledbetter v. Goodyear Tire & Rubber Co., 550 U.S. 618 (2007), which requires an employee to bring a federal claim of pay discrimination in violation of the Title VII of the Civil Rights Act of 1964 (Title VII) within 180 days (or in some states, including New York and New Jersey, within 300 days) of the decision that caused the pay disparity.

In the Ledbetter case the Supreme Court ruled that Lilly Ledbetter was too late when she filed her gender discrimination lawsuit against Goodyear. In her case, Ms. Ledbetter as seeking damages because she was paid a lower salary than men in comparable positions at the company. The Supreme Court ruled that her claim was untimely because she did not file a charge of discrimination with the United States Equal Employment Opportunity Commission (EEOC) within 180 days after the company's initial discriminatory decision, even though she was still underpaid due to the past discrimination, since her salary remained lower than her male coworkers throughout her career.

The Ledbetter decision has been highly criticized ever since it was decided. One problem with it is that employees generally do not know how much their coworkers are paid, often making it difficult or impossible for them to determine that their employers are discriminating against them with respect to their compensation, As a result, employees who have been underpaid because of their race, color, sex (gender), religion, national origin, or disability are unlikely to know about it until long after the 180 (or 300) day EEOC filing deadline.

The Lilly Ledbetter Fair Pay Act would amend both Title VII and the Americans with Disabilities Act of 1999 (ADA) by making it a separate violation of the law each time (1) a company adopts a discriminatory compensation decision or practice, (2) a company subjects an employee to a discriminatory compensation decision or practice, or (3) an employee is affected by a discriminatory compensation decision or practice, including each time an employee receives any wages, benefits, or other compensation that is at least in part the result of a discriminatory decision or practice.

As a result, under the law a new 180 (or 300) day period would start each time an individual is paid less due to his or her race, color, sex (gender), religion, national origin, or disability. In addition, the law would permit an employee to prove damages resulting from pay discrimination for up to 2 years before the employee filed a charge of discrimination with the EEOC. The law, as currently drafted, would be retroactive so it would apply to all covered discrimination that occurred on or after May 28, 2007, as well as to all claims that have been pending in the EEOC or in Court since that date.

Before the Fair Pay Act can become law, it still needs to be approved by the United States House of Representatives, and then to be signed into law by President Obama.