New Jersey Employment Lawyer Blog

FLSA and FMLA Protect Employees Misclassified as Independent Contractors

November 10, 2015 | by Jonathan I. Nirenberg

The United States Department of Labor recently released a formal Interpretation explaining how to determine whether a worker is an employee or an independent contractor under Fair Labor Standards Act (“FLSA”). The FLSA is a federal law which sets minimum wage and overtime pay requirements.

The Interpretation was written by David Weil, the Administrator of the DOL’s Wage and Hour Division. He explains that an increasing number of employers are misclassifying employees as independent contractors. As a result, many workers are unfairly denied minimum wage, overtime pay, unemployment insurance and other benefits.

As Mr. Weil indicates, the FLSA defines “employer” extremely broadly. It includes anyone the employer “suffers” or “permits” to work for it. Accordingly, “most workers are employees under the FLSA.”

Unlicensed Employment Agencies Cannot Enforce Non-Compete Agreements

November 1, 2015 | by Jonathan I. Nirenberg

The New Jersey Employment Agencies Act requires employment agencies doing business in New Jersey to register and obtain licenses from the New Jersey Division of Consumer Affairs. Agencies that fail to do so cannot file lawsuits seeking to collect fees or commissions that are owed to them, or to enforce employment agreements with the individuals who work for them. For instance, an unlicensed employment agency cannot sue to enforce a non-compete agreement.

However, a recent case makes it clear that although both employment agencies and temporary help service firms must register with the state, only employment agencies have to obtain licenses.

The case involves Varuna Jothi Uppala, an Information Technology worker who was employed by Logic Planet. Logic Planet agreed to train Ms. Uppala and assign her to work for its clients on temporary assignments. Ms. Uppala was an employee of Logic Planet, which agreed to pay her a salary of $60,000 per year and to provide her health insurance and other benefits.

Jury to Decide Whether Nurse’s Disability Prevented Her From Working

October 22, 2015 | by Jonathan I. Nirenberg

The New Jersey Appellate Division Court recently considered the standard for discharging an employee based on a “perceived disability,” and in so doing reversed a grant of summary judgment to the defendant. In Grande v. Saint Clare’s Health System, the Court applied the standard established in 1998 in Jansen v. Food Circus Supermarkets, Inc., which provides that in evaluating whether an employee can remain in a position despite having a disability, the standard is “whether the handicapped person can do his or her work without posing a serious threat of injury to the health and safety of himself or herself or other employees.” This “requires the employer to conclude with a reasonable degree of certainty that the handicap would probably cause such an injury” before it can fire an employee. According to the Court, in determining whether the employee “poses a materially enhanced risk of serious injury . . . [p]robability, not mere possibility, is key.”

In this case, the plaintiff, Marianne Grande, worked as a nurse for the defendant employer, St. Clare’s Health System, for approximately ten years. During her last three years of employment, she suffered three injuries at work, two injuries to her shoulder and one to her back. Following her back injury, she took family and medical leave followed by personal leave. While on leave, the plaintiff’s physician cleared her to return to work full time without any restrictions. Despite such clearance, the defendant required her to participate in a “functional capacity evaluation test,” to assess her ability to, for example, lift certain objects and move in certain ways. In her role as a nurse, she worked with stroke victims and sometimes was required to move patients.

When the evaluation was completed, it provided for some restrictions. At this time, the plaintiff’s doctor allowed her to return to work in accordance with the restrictions set forth in the hospital’s evaluation. That same day, however, the hospital discharged the plaintiff indicating it could not accommodate her disability given the restrictions set forth in the evaluation. Approximately one month after her discharge, the plaintiff’s doctor cleared her to return to work, again without restrictions. Notwithstanding such clearance, the hospital declined to rehire her.

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.