New Jersey Employment Lawyer Blog

Employee Can Forfeit Salary Through Extreme Disloyalty to Employer

October 14, 2015 | by Jonathan I. Nirenberg

One important employment law principle is that employees owe a duty of loyalty to their employers. This generally means they cannot act contrary to the interest of their current employer. The New Jersey Supreme Court recently explained that an employee who breaches this duty can be required to pay back the salary he received while he was disloyal, even if the breach did not cause the employer any damage. The concept of requiring an employee to pay back his salary based on his misconduct is called “equitable disgorgement.”

Bruce Kaye owned and managed three separate timeshare businesses in New Jersey, Flagship Resort Development Corporation, Atlantic Palace Development, LLC and La Sammana Ventures, LLC. His employee, Alan Rosefielde, is an attorney who served as the Chief Operating Officer and General Counsel for two of those businesses. Mr. Rosefielde’s salary was $500,000 per year.

The trial court ruled that Mr. Rosefielde violated his duty of loyalty to his employers. For example, when he formed a new business to manage the timeshare properties owned by one of Mr. Kaye’s businesses, Mr. Rosefielde gave himself a larger percentage ownership in the new business than he and Mr. Kaye had agreed. Mr. Rosefielde also falsely claimed another new business he formed would manage sales only for one of Mr. Kaye’s businesses, but tricked Mr. Kaye into signing documents authorizing the new company to manage sales for companies all over the world. Mr. Rosefielde’s other misconduct included receiving reimbursement for $4,000 of personal expenses by falsely claiming they were business expenses, directing someone to forge the signatures of defaulting timeshare unit owners who could not be located to transfer their ownership without foreclosure proceedings, and making misrepresentations to an insurance company to provide health insurance to independent contractors working for Mr. Kaye’s businesses.

Court Finds No Gender Discrimination in Weight Requirements for “Borgata Babes”

October 7, 2015 | by Jonathan I. Nirenberg

A recent decision from the New Jersey Appellate Division holds that the Borgata Casino Hotel & Spa’s did not violate the New Jersey Law Against Discrimination (“LAD”) by requiring certain employees not to gain too much weight.

The Marina District Development Company, LLC, better known as the Borgata Casino Hotel & Spa, has a program called “Borgata Babes.” Under it, the Atlantic City Casino hires attractive men and women to work wearing costumes. The Casino says that being a Borgata Babe requires a “certain appearance to portray a certain image to the public.” It compares the job with being a professional cheerleaders or model.

For instance, the Casino requires female Borgata Babes to have a “natural hourglass shape.” It also prohibits Borgata Babes from increasing their weight by more than 7% over their weight when they were hired, with exceptions for medical reasons and pregnancy. Its policy is to suspend employees who exceed this requirement to give them opportunity to lose weight, and to fire them if they fail to do so.

Employer Must Request More Information Before Denying FMLA Leave Based on Deficient Medical Certification

September 16, 2015 | by Jonathan I. Nirenberg

The Third Circuit Court of Appeals recently ruled that when an employee submits a deficient medical certification in support of a request to take time off pursuant to the Family Medical Leave Act (“FMLA”), the employer has to give the employee an opportunity to correct the deficiencies before it can deny the request. The Third Circuit is the federal appellate court which handles appeals stemming from New Jersey, Pennsylvania, Delaware and the Virgin Islands.

Deborah Hansler worked for Lehigh Valley Health Network as a technical partner. In March 2013, she began experiencing medical symptoms including shortness of breath, nausea and vomiting. On March 13, she requested an intermittent FMLA leave and submitted her doctor’s supporting medical certification form. The certification indicated that she needed two days off per week for approximately a month. However, it did not identify her medical condition because her doctor had not yet diagnosed her.

Ms. Hansler took a total of 5 days off from work for medical reasons between March 13 and March 25, 2013. Lehigh Valley never asked Ms. Hansler or her doctor to explain why she needed this time off. Instead, on March 28, 2013, the company fired her for “excessive absences” including the five days she took off due to her medical condition. When Ms. Hansler reminded Lehigh Valley that she had requested time off pursuant to the FMLA, Lehigh Valley told her it had denied her request for a leave.

No Compensatory Damages for Breach of Non-Compete Agreement Without Proof of Actual Harm

September 8, 2015 | by Jonathan I. Nirenberg

A recent decision from the District of New Jersey recognizes that employers are not entitled to compensatory damages from employee who breach their non-competition agreements unless the employer can prove it would have received the income but-for the violation.

The case involved Jose Munoz and Roberto Abreu, two former employees of Job Connection Services, Inc. (“JCS”). JSC provides employers with job placement and human resources support.

Mr. Munoz and Mr. Abreu each signed one year non-compete agreements with JSC when it hired them. Those agreements prohibited them from owning, operating, or joining a business that directly or indirectly competes with JSC within sixty mile of any JCS office.

Employer Cannot Fire Employee for Requesting Time Off for Disability

September 1, 2015 | by Jonathan I. Nirenberg

A recent employment law case from the District of New Jersey demonstrates that you might be entitled to time off from work for a disability under the New Jersey Law Against Discrimination (“LAD”) even if you are not protected by the Family & Medical Leave Act (“FMLA”).

Colleen Pizzo worked as a custodian for the Lindenwold Board of Education. Ms. Pizzo suffers from bipolar depression. She took several days off from work for depression after her girlfriend and coworker died in February 2012. A few months later she took approximately 6 weeks off for depression pursuant to the FMLA. She continued to take additional time off due to her depression after she returned from that medical leave.

By March 2013, Ms. Pizzo had taken 12 weeks of FMLA leave during the previous 12 months. She asked the Board to allow her to use “sick bank,” meaning sick leave donated by her coworkers, so she could take time off for “work-related stress.” The Board ignored her request.

Court Approval Needed to Dismiss Overtime Lawsuit

August 24, 2015 | by Jonathan I. Nirenberg

The Second Circuit Court of Appeals recently ruled that the parties to a lawsuit cannot agree to dismiss a case under the Fair Labor Standards Act (“FLSA”) as part of a settlement unless they have the approval of a Judge or the United States Department of Labor (“DOL”). The FLSA is a federal wage and hour law which establishes minimum wage and overtime requires.

Dorian Cheeks worked as a server for Freeport Pancake House, Inc. and W.P.S. Industries, Inc. He filed a lawsuit in the Eastern District of New York against both companies in which he asserted claims under the FLSA and New York Labor Law. He is seeking unpaid overtime pay and liquidated (double) damages, as well as attorneys’ fees. He also alleges that the Pancake House demoted him and eventually fired him because he objected about the company’s failure to properly pay overtime to him and its other employees, and is seeking damages for his past and future lost wages.

Mr. Cheeks and the Pancake House eventually agreed to settle the case. Accordingly, they filed a stipulation with the court seeking to have the case dismissed with prejudice. However, the court refused to dismiss the case. Instead, it directed the parties to file a copy of their settlement agreement as part of the public record, and to explain why they believe the settlement is “fair and reasonable.” The Court did so because the FLSA prohibits employees from waiving their rights under it unless their settlement agreement either was supervised by the DOL or approved by a court.

Ineffective Policy No Defense to Sexual Harassment Claims

August 14, 2015 | by Jonathan I. Nirenberg

A recent decision by New Jersey’s Appellate Division makes it clear that merely having an anti-harassment policy does not insulate employers from sexual harassment lawsuits. The ruling comes on the heels of the New Jersey Supreme Court’s ruling earlier this year in Aguas v. State of New Jersey, which created a new affirmative defense for employers in sexual harassment cases under the New Jersey Law Against Discrimination (“LAD”). I discussed Aguas in my article: Importance of Reporting Sexual Harassment Reinforced by New Jersey Supreme Court.

The Appellate Division ruling involved Anita Jones, who worked for Mott’s LLP as a machine operator. For most of her employment, Ms. Jones was a temporary employee.

According to Ms. Jones, numerous Mott’s employees sexually harassed her. For example, she says the individual who initially trained her repeatedly touched her breasts. She says that when she objected, the harasser yelled at her. She did not report this sexual harassment to anyone because she was just a temporary employee. When she complained to a supervisor about the employee yelling at her, the supervisor promised he would take care of it. However, she alleges that when she complained to the same supervisor several other times he either put his arm around her shoulders or touched her back. She did not object to this harassment because the supervisor warned her that “temps come a dime a dozen and [if] one don’t do what you want, you get another one,” implying he would have her fired if she complained about him.

Apparent Authority Enough to Enforce Employment Agreement

August 5, 2015 | by Jonathan I. Nirenberg

A recent ruling by New Jersey’s Appellate Division makes it clear that, in some circumstances, an employee can enforce an employment contract even if the individual who entered into it on behalf of the company did not have the authority to do so.

The case was filed by four individuals, Arkadiusz Lukaszewski, Dariusz Gocal, Tadeusz Ogrodnik, and Ryszard Klysinski. They each worked for Jasticon, Inc. as bricklayers. They claim another employee, Piotr Zablocki, promised them “they would be given long-term employment” with Jasticon for “at least 18 months.” They also claim Mr. Zablocki assured them they would work on “big projects” in New Jersey and that they “would never run out of work.”

Nonetheless, the company fired them after less than a year. They subsequently filed a lawsuit in which they asserted numerous claims, including breach of an 18-month employment contract.

New York Raising Minimum Wage for Fast Food Workers

July 23, 2015 | by Jonathan I. Nirenberg

Yesterday afternoon, New York States’ Fast Food Wage Board approved a set of three resolutions that recommend raising the minimum wage for employees who work for fast food chains to $15 per hour. This would be $6.25 more than New York’s current $8.75 minimum wage.

The Fast Food Wage Board was formed the past May, at the request of Governor Andrew M. Cuomo, to review wages in the fast-food industry.

Under the three resolutions, covered “Fast Food Establishments” include any business in New York State that serves food and drink (1) at which customers order and pay before they eat; (2) which provides “limited service,” which presumably means they offer limited or no table service; and (3) which are part of a chain that has at least 30 locations throughout the United States.

New Jersey’s Whistleblower Law Protects All Employees, Including “Watchdogs”

July 16, 2015 | by Jonathan I. Nirenberg

Yesterday, the New Jersey Supreme Court ruled that New Jersey’s whistleblower law, the Conscientious Employee Protection Act (“CEPA”), protects employees who blow the whistle about issues that relate to their job duties.

CEPA is a broad whistleblower law. It prohibits employers from retaliating against employees who, among other things, object to or refuse to participate in activities they reasonable believe are illegal, fraudulent, or violate a clear mandate of public policy relating to public health, safety, welfare or the environment. It also protects licensed medical professionals who object to or refuse to participate in activities they reasonably believe constitute improper quality of patient care.

On several occasions, New Jersey’s Appellate Division has ruled that employees are not protected by CEPA if their objections relate to their job duties. This threatened to dramatically limit the scope of CEPA’s protection since employees typically are in the best position to blow the whistle on activities related to their job functions.