New York Employment Lawyer Blog

There is momentum now in Albany to push through a Wage Theft Bill that will protect workers from overtime pay and minimum wage violations. Recent studies reveal that low wage workers in New York are being ripped off. One study showed that over 300,000 people a week are paid less than the minimum wage. Another study showed that workers who earn $20,000 a year lose an average of $3,016.00 in unpaid wages per year. Not only are workers getting hit, but the wave of wage violations deprives New York State of $427.9 million in unpaid premiums for workers compensation, unemployment insurance and taxes.

Both workers and tax payers are losing money because employers are cheating workers out of overtime pay and earned wages with impunity. Employers can afford to ignore the overtime pay and minimum wage laws now because the penalties are so light - it actually makes good business sense to underpay employees and refuse overtime pay premiums.

The new Wage Theft Bill is intended to increase penalties so that employers will be forced to follow the minimum wage and overtime pay laws. For more on this subject see the article in Todays Workplace, Huffington Post.

One common trick used by employers is to misclassify employees as independent contractors and then not pay them overtime, minimum wage or provide benefits. These new law contemplated now in Albany would prohibit these tricks and the fines and penalties hopefully will be tough enough to do the job. We will have to wait and see what the law looks like when it is actually passed.

The Wage & Hour blog by Fox Rothchild recently reported that a New York federal court has given the OK to strippers who filed a class action suit for overtime pay against the Penthouse Executive Club in New York City. The strippers claim that they were not paid the minimum wage and that they were denied overtime pay. The dancers also alleged that the owners illegally skimmed their tips by exacting a 20% "service charge."

The Penthouse Executive Club tried to convince the court that the case should not be certified as a class action because all of the dancers were treated differently. Companies often try to defeat class actions by contending that each employee or claimant has a unique claim and therefore the claims are not "common" enough to warrant class actin status. But in this case, the judge did not buy that argument because he found that all the strippers did the same work, were paid under the same overtime pay procedures and all had their tips skimmed.

So far the dancers case looks promising. They brought their overtime pay and minimum wage claims under the Fair Labor Standards Act and New York State Labor Law. They also seek reimbursement for their "uniforms."

"First they ignore you, then they laugh at you, then they fight you, then you win." - GANDHI

If you are thinking of bringing a case against your employer, you should know how these cases often play out. It can be a wild ride and you need to know what you are in for before you take that leap. After handling hundreds of employment discrimination and sexual harassment cases over the years, I have noticed that these cases all tend to follow the same pattern.

Stage One - Ignoring It

Companies often ignore our initial efforts to communicate with them about the case. We typically send a short letter to the company to see if they are interested in resolving the matter. Most of the time the companies simply ignore these letters or provide a curt denial. The one exception to this rule are cases that involve severance packages. When we contact companies about an employee who has been provided with a severance agreement, companies tend to be more willing to discuss the matter.

Stage Two - Laughing About It

I cannot tell you how many times companies have tried to laugh off the allegations made in our employment cases. The arrogance can be shocking. But let them laugh. We have handled many cases that start out with laughing denials and wind up settling with a large check or a verdict against the company. In fact, during a recent sexual harassment case, the company representatives and lawyers were actually laughing during the hearing. I would love to have seen their faces when they received the judge's decision finding in our client's favor.

Stage Three - Fighting It

Typically, after ignoring the case and then laughing it off, the company will then fight it. They will deny the allegations, blame our client or anyone else they can cast blame upon. They will try to delay the case or complicate it and they will resist turning over relevant information. The lawyers who defend companies in these cases are typically paid by the hour so they try to drag things out so they can bill more hours. For example, a deposition that should only take two hours will take seven or eight hours and the company lawyers may even try to drag it out into a two day affair. If you bring an employment case against your employer, you may have your deposition taken and during this deposition you may be accused of being incompetent, dishonest, immoral and generally unfit for employment. You may also have to deal with requests for information that have no connection to your case. For example, I recently had to fend off a request for dental records in an employment discrimination case. Our client's dental records obviously had nothing to do with the case but the company asked for them anyway just to be annoying. These are just a few examples of what goes on in these cases. Once these cases get into litigation, they tend to be long, nasty, expensive and unpleasant.

Stage 4 - You Win

If you can survive the first three stages of an employment case, you hopefully will experience the joy of winning. But, understand that approximately 95% of these cases are resolved through settlement and you are not likely to feel entirely vindicated. All settlements require compromise and that means getting less than you deserve. So do not plan on feeling like you won. Instead, you will hopefully feel like a reasonable solution was reached in which both sides compromised their positions.

The Dodd-Frank Act was passed last July (2010) in a belated attempt to curb corporate shenanigans on Wall Street. The goal of the Dodd-Frank Act is to prevent the corrupt and irrational behavior that wreaks havoc upon investors and the countries financial system. These lofty goals might make for good politics, but I doubt this law will transform the financial system. Laws don't work unless someone is willing to report the violations. For this law to really work, the financial executives who observe the violations need to feel comfortable reporting them. But fear of retaliation will deter many from reporting violations of the Act.

The Dodd-Frank Act contains a strong anti-retaliation provision in Section 1057 entitled "Employee Protection." This section prohibits a company from firing or taking any adverse against any who has -

(1) provided, caused to be provided, or is about to provide or cause to be provided, information to the employer, the Bureau, or any other State, local, or Federal, government authority or law enforcement agency relating to any violation of, or any act or omission that the employee reasonably believes to be a violation of, any provision of this title or any other provision of law that is subject to the jurisdiction of the Bureau, or any rule, order, standard, or prohibition prescribed by the Bureau;

(2) testified or will testify in any proceeding resulting from the administration or enforcement of any provision of this title or any other provision of law that is subject to the jurisdiction of the Bureau, or any rule, order, standard, or prohibition prescribed by the Bureau;

(3) filed, instituted, or caused to be filed or instituted any proceeding under any Federal consumer financial law; or

(4) objected to, or refused to participate in, any activity, policy, practice, or assigned task that the employee (or other such person) reasonably believed to be in violation of any law, rule, order, standard, or prohibition, subject to the jurisdiction of, or enforceable by, the Bureau.

If a financial executive or other employee is retaliated against for reporting a violation of the Dodd-Frank Act, they are required to file a complaint with the Secretary of Labor. The Secretary of Labor is required to investigate the matter and issue a ruling. The Secretary of Labor can order the reinstatement of the fired employee or make other orders to remedy the harm including an award of compensatory damages. If the Secretary of Labor does not take action within 210 days of the complaint, the aggrieved employee can file a case in federal court.

These anti-retaliation laws can produce excellent results in certain situations. If an employee can establish that they reported their employer for violating the Dodd-Frank Act (make sure your report of wrong doing is in writing) and that they were promptly fired, demoted or otherwise subject to adverse employment action, then a substantial recovery is likely. These can be great cases. In fact, retaliation case produce some of the best results for our clients.

I am surprised that more people are not using technology to capture evidence in employment cases. It's now so easy to record people or photograph them and this kind of evidence can win cases. In most every employment discrimination and sexual harassment case, the outcome of the case turns on who the judge or jury believes. In a sexual harassment case, for example, the victim contends that her boss sexually harassed her and the boss denies it. Likewise, in many employment discrimination cases the victim argues that she was fired because of her race, age, sex, religion etc and the accused company denies it. A recording of key comments could win these cases.

A new case in New York involving a secret recording made by an iphone makes it clear that it is legal to make certain kinds of secret recordings in New York. Also, technology today makes it very easy to make secret recordings. An iphone or blackberry, for example, can now be turned into a voice recorder by installing an app such as Quick Voice or you can buy a tiny voice recorder on the web. With one of these devices, it is possible to record the sexual harasser's lewd comments comments or capture the bigot's racial slurs. Capturing these kinds of comments can turn a tough case into a great case.

In New York, you can secretly record any conversation so long as you are part of that conversation. You do not need to let the other people know that you are making a recording. But you can NEVER record a conversation if you are not part of that conversation. For example, you cannot secretly record a phone call if you are not part of the call.

The law on this subject was a little murky until the recent Caro decision. In August of 2010, the Second Circuit Court of Appeals, in Caro v. Weintraub, held that Title III of the Omnibus Crime Control and Safe Streets Act permits such recordings. In Caro, one party to a conversation placed their iphone on the table and recorded the conversation without anyone else knowing it. The court held that this was lawful. This is also lawful under the New York State wiretapping law. See the Citizen Media Law Project site for more on the New York wire tapping law. Other states such as California, Florida, and Connecticut, have laws that prohibit any kind of secret recordings, but in New York it is legal so long as the person making the recording is a party to the conversation.

In the future, victims of employment discrimination and sexual harassment should seriously consider recording the illegal conduct at work. You can be sure that the company will deny any wrongdoing and a recording may be the only way to prove your case. But you need to be careful how you make the recordings. Before making any recordings, you might want to talk to a good employment lawyer so they can guide you. Also, if you are not in New York, you should check your local laws before making any kind of secret recordings because twelve states currently prohibit such recordings.

The list below was taken from the Ohio Employers Law Blog written by Jon Hymen. The Ohio Employers Law Blog is written for companies and the ten items listed below are points that companies often include in their severance agreements. If you, as an employee, are provided with a severance agreement, you will probably see similar terms in your severance agreement. The ten points listed below might be useful to know about so you can understand why those terms are present. After some of the points listed below, I have added points from the employee's perspective in bold.

1. Consideration: A statement that the consideration provided to the employee is more than that to which the employee is otherwise entitled to employment by way of employment. Otherwise, the release and waiver could fail for the employee not receiving anything of value in exchange.

Consideration is the legal term for an exchange of value. A contract is not enforceable unless there is a tangible exchange of value. In a severance agreement, the exchange of value is usually an extra payment to the departing executive in exchange for a waiver of the executive's right to sue the employer. It is important that you understand this part of the severance agreement. You should not sign a severance agreement unless you understand exactly what you are getting and what you are giving up.

2. Confidentiality: A covenant as to the confidentiality of the agreement. You do not want other employees learning the terms of the separation, or that agreement was even reached. Otherwise, it could open the floodgates to other employees seeking separation packages.

As an executive who is leaving the company, you may also be interested in keeping the terms of your departure confidential. If so, you should ask your employer to make the confidentiality agreement mutual so it protects you as well.

3. Secrets: A covenant as to the confidentiality of employer’s confidential and proprietary information.

4. Return of Property: A covenant that all corporate property has been returned, or will be returned by a date certain.

In some cases, executives are escorted out of the building right after they learn of the termination and they never get the chance to remove their personal property from their offices. If this happens to you, be sure to include a clause in your severance agreement that requires the return of your personal property. It is best if you can list the items that you need to have returned.

5. Transition: A promise to reasonably cooperate with the employer as to the transition of job duties and responsibilities.

If the company is seeking your cooperation in transitioning your job to another employee, then you may also ask the company for assistance as you try to find alternate employment. As we all know, it is far easier to find a job when you have one and therefore it may help if you remain with the company in some limited capacity during your job search and retain your company email and a company phone number. It may serve everyone's interest if you keep your company email and phone number for a few months so you can help the company transition your role and so that you can look for another job.

6. No-rehire: A promise that the employee will not apply for any positions in the future, and that the company is not obligated to consider him or her for future employment. Because there is some risk that a clause such as this could be viewed as retaliatory, indemnification language is not a bad idea.

If you work for a large organization such as General Electric, you may not want to sign a severance agreement that contains a no-rehire clause because they own so many other companies and this could bar future employment with any of them. We have had many clients run into trouble with these clauses as they try to obtain alternate employment. Also, I have found that many companies are willing to remove this clause upon request.

7. No Liability: A statement that the agreement is not an admission of liability.

8. Governing law, Jurisdiction, and Venue: An agreement as to the law that will govern the agreement, and the jurisdiction and venue in which one must file any lawsuit regarding a breach of the agreement.

9. Entire Agreement: An integration clause, stating that the written agreement is the parties’ entire agreement, that no other written or oral agreements exist, and that the parties may only amend the agreement in writing signed by all.

10. Voluntariness: An acknowledgement that the employee read and understands the agreement, and had sufficient time and an opportunity to consult with his or her own legal advisor prior to signing the agreement.

Disability discrimination verdicts appear to be on the rise. Recently, a former Rite-Aid employee won $3.4 million in a disability discrimination case. The plaintiff in that case was 45 year old Maria C. Martinez who worked for Rite-Aid from 1983 to 2007 as a pharmacy technician.

In 2003, Ms. Martinez was required to take disability leaves of absence to treat a psychiatric illness. In 2004, Ms. Martinez experienced a work related anxiety attack and took several months off of work.

When Ms. Martinez returned to work, her supervisors harassed her on account of her psychiatric disability. They called her a “basket case” and gave her unwarranted reprimands and transferred her from store to store.

At trial, Ms. Martinez accused Rite-Aid and her supervisors of disability discrimination. The jury found that Rite-Aid’s employees intentionally discriminated against Ms. Martinez due to her psychiatric disability. Another phase of the trial is set to begin shortly to determine the amount of punitive damages. The punitive damages will be in addition to the $3.4 million verdict already rendered.

Disability discrimination verdicts appear to be on the rise. Recently a jury in Florida awarded a cancer patient over $8 million. The cancer patient was fired while she was receiving cancer treatment. The jury found that her employer blatantly violated disability discrimination laws.