September 12, 2014

FLSA: counting the cost locally

Posted in Exempt/Non-Exempt Employees, Fair Labor Standards Act, Overtime tagged , , , , , , at 11:08 am by Tom Jacobson

time clockA Douglas County, MN employer recently learned a costly lesson when it misunderstood who is and is not exempt from the overtime pay requirements of the Fair Labor Standards Act (FLSA).

In this case, an employee was given a “manager” title and paid a fixed salary, but the employee alleged that his duties were primarily custodial and customer service and did not fit within any exemption allowed by the FLSA. Applying the formula set by FLSA regulations, the employee converted his “salary” to an hourly rate ranging from $11.61 to $13.54 with an overtime premium ranging from $5.81 to $6.77 per hour.

Failing to pay an employee an additional $5.81 to $6.77 per hour may not seem like a terribly expensive mistake, but in this case the employee had evidence suggesting that he had worked about 640 hours of unpaid overtime during his last year of employment. This calculated to approximately $3,800.00 of unpaid overtime, but that wasn’t the end of the story. The FLSA also allows an employee to double the amount of unpaid back wages as liquidated damages, so using the employee’s figures, the $3,800.00 became $7,600.00.

To compound the problem, the employee claimed that the employer also withheld $1,300.00 of the his final wages in violation of Minn. Stat. § 181.13, thus triggering the 15 day wage penalty of that statute. This added another $1,700.00 to the employee’s claim.

Because these laws also allow the employee to recoup his attorney’s fees incurred in trying to recover his wages, he tacked them on as well. Those fees exceeded $4,000.00.

Thus, the employee argued that the employer’s $6.00 per hour mistake became a liability exceeding $14,000.00 (excluding the employer’s own attorney’s fees incurred in defending the claim). The case was eventually settled out of court with a confidential agreement between the parties.

The case illustrates how costly it can be when an employer improperly classifies a non-exempt employee as exempt under the FLSA. Simply calling someone a “manager” and paying her a fixed salary does not automatically make her exempt from overtime. This is because exemptions are highly dependent on the employee’s actual duties, not her title and form of pay. And, while an hour of unpaid overtime may not seem like a huge risk, when those hours accumulate over time and are doubled as liquidated damages, a few dollars can quickly become several thousand, especially when attorney’s fees and court costs are added. Moreover, it’s a much greater problem if multiple employees are involved.

For more information about FLSA exemptions, please contact me at alexandriamnlaw.com or taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2014 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

August 1, 2014

Another day, another Executive Order impacting federal contractors

Posted in Age, Alternative Dispute Resolution, Americans with Disabilities Act, Arbitration, Arbitration, Color, Creed, Disability, Discrimination, Fair Labor Standards Act, Family and Medical Leave Act (FMLA), Gender / Sex, Harassment, LGBT, Minnesota Human Rights Act, National Labor Relations Act, National Origin, Pregnancy, Race, Religion, Sexual Harassment tagged , , , at 11:23 am by Tom Jacobson

White HouseIn another attempt to flex his regulatory muscle, President Barack Obama on July 31, 2014 issued yet another Executive Order aimed at federal contractors. This one, the Fair Pay and Safe Workplaces Executive Order, requires potential federal contractors to disclose past employment and labor law violations before they can secure federal contracts.

Earlier this month, President Obama issued an Executive Order to protect the rights of LGBT employees of federal contractors (see President Issues Order to Protect LGBT Workers).

Yesterday’s Order requires most potential federal contractors to disclose violations in the past three years of thirteen specified federal labor and employment laws. These laws include the National Labor Relations Act, the Fair Labor Standards Act, the Family and Medical Leave Act, the Americans with Disabilities Act, the Occupational Safety and Health Act, the Age Discrimination in Employment Act and Title VII of the Civil Rights Act of 1964, and any state counterparts of these statutes.

The Order also directs employers with contracts of $1 million or more to “agree that the decision to arbitrate claims arising under title VII of the Civil Rights Act of 1964 or any tort related to or arising out of sexual assault or harassment may only be made with the voluntary consent of employees or independent contractors after such disputes arise.” In other words, the Order will severely limit these federal contractors’ rights to enter into pre-dispute arbitration agreements.

The Order appears to be directed at preventing repeat offenders, but it will have a major impact on employers who will need to overcome this new regulatory hurdle before securing federal contracts.

For more information about the President’s Order, see Obama Signs Executive Order Protecting Federal Contractors’ Employees (CBS News, 7/31/14), President Issues Order Requiring Contractors to Disclose Labor Law Violations When Competing for Federal Contracts (SHRM, 7/31/14), the President’s FACT SHEET: Fair Pay and Safe Workplaces Executive Order, or contact me at taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2014 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

July 30, 2014

Defamation vs. Unjust Enrichment

Posted in Defamation, Libel, Slander, Unjust Enrichment tagged , , , , at 9:23 am by Tom Jacobson

Although Jesse Ventura’s lawsuit against Chris Kyle’s Estate was hyped as a “defamation” trial, $1.3 million of the $1.8 million jury verdict was actually an award for “unjust enrichment.”  So, what is unjust enrichment?

In Minnesota one is unjustly enriched if s/he knowingly received or obtained something of value for which s/he in equity and good conscience should pay. And, unlike in a defamation case where damages are based on harm to the plaintiff’s reputation and the plaintiff’s humiliation and embarrassment, damages in an unjust enrichment case are based on the defendant’s profit from his/her wrongful acts.

In the Ventura trial the jurors were instructed to not even consider the unjust enrichment claim unless they first determined that defamation had occurred. Because they found defamation, they were then told to consider: whether the Kyle Estate knowingly received a benefit from the defamatory story; and whether the Estate is not entitled to the benefit received because of circumstances that would make it unjust for it to retain that benefit without compensating Ventura. Because the jury found that unjust enrichment occurred, they were then instructed to award Ventura the amount of money by which they found the Estate had been unjustly enriched.

Defamation and unjust enrichment claims can arise in any employment setting. For example, a supervisor’s false statement about a former employee could lead to a defamation claim. And, an employer’s failure to pay an employee for a benefit the employee provided to the employer could result in an unjust enrichment claim.

For more information about this article, please contact me at  taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2014 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

July 28, 2014

Minimum wage hike takes effect Friday

Posted in Minimum Wage, Uncategorized tagged at 11:28 am by Tom Jacobson

Minnesota_State_Capitol_5The first phase of Minnesota’s minimum wage increases will take effect this Friday, August 1, 2014. Starting then, small employers must pay at least $6.50 per hour, and large employers must pay at least $8.00 per hour.

The law also allows for a 90-day training wage and a youth wage, both of which mirror the small employer minimum wage rates. It also includes automatic increases on August 1, 2015 and August 1, 2016, and it allows for inflationary increases starting in 2018.

For minimum wage purposes, state law defines a large employer as any enterprise with an annual gross dollar volume of sales made or business done of $500,000.00 or more. A small employer is any enterprise with an annual gross volume of sales made or business done of less than $500,000.00.

For more information about this article, please see the Minnesota Department of Labor and Industry’s fact sheet on minimum wage rates, the DOLI’s related Employer Fact Sheet, or contact me at taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2014 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

July 22, 2014

President issues order to protect LGBT workers

Posted in Discrimination, Gender / Sex, LGBT, Minnesota Human Rights Act, Sexual Orientation tagged , , at 2:08 pm by Tom Jacobson

White HousePresident Barack Obama on July 21, 2014 issued an executive order intended to protect the employment rights of LGBT employees of federal contractors.

Although some states, including Minnesota, already prohibit employment discrimination based on sexual orientation, not all do.  Therefore, President Obama said during the signing ceremony that he issued the order as a way “to address this injustice for every American.”

Unlike some legislation, such as the proposed Employment Non-Discrimination Act (“ENDA”) which was passed in 2013 by the U.S. Senate but which has since stalled in Congress, this executive order does not contain any exemptions based on religious beliefs.

The President also directed the U.S. Department of Labor to prepare regulations to implement the order. It is anticipated that advocates on all sides of the issue will offer significant input as the regulations are developed.

For more information about this article, please contact me at alexandriamnlaw.com or  taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2014 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

July 1, 2014

Key provisions of WESA take effect July 1

Posted in Care of Relatives Leave, Discrimination, Domestic violence, Employee Handbooks, Employee Privacy, Equal Pay, Gender / Sex, Leaves of Absence, Minnesota Human Rights Act, Minnesota Parenting Leave Act, Nursing Mothers, Parenting Leave, Pregnancy, Retaliation, Sick Leave, Sick or Injured Child Care Leave, Wage non-disclosure, Women's Economic Security Act tagged , , , , , at 12:56 pm by Tom Jacobson

2014_05_11_WESA_signingAlthough Gov. Mark Dayton signed it into law on May 11, 2014 the following key provisions of the Women’s Economic Security Act (WESA) go into effect today:

  • Expansion of Minnesota’s parenting and pregnancy leave laws: More employees are now eligible for this leave, and the amount of available leave has been increased from six to twelve weeks. Applies to Minnesota employers with 21 or more employees.
  • Expansion of permissible use of sick leave: Parents-in-law and grandchildren are now included in the list of persons for whom eligible employees may use their sick leave. Employees may also use sick leave for “safety leave,” which is leave for the purpose of providing or receiving assistance because of sexual assault, domestic abuse, or stalking. Applies to Minnesota employers with 21 or more employees.
  • Wage disclosure prohibitions; employee handbook notice requirement; remedies: Prohibits employers from, among other things, requiring employees to keep their wages confidential. Requires employers to include in their employee handbooks a notice regarding employees’ rights and remedies under the new law. Allows employers to prohibit wage disclosure to competitors and to otherwise protect trade secrets, proprietary and other privileged information. Applies to all Minnesota employers with one or more employees.
  • Clarifies rights of nursing mothers: Clarifies that when making reasonable efforts to provide a room or other location for expressing breast milk in privacy, that space must: be in close proximity to the work area; be somewhere other than a bathroom or a toilet stall; be shielded from view; be free from intrusion from coworkers and the public; and include access to an electrical outlet.  Applies to all Minnesota employers with one or more employees.

This is only a summary of portions of WESA that take effect today. Other provisions of WESA went into effect on May 12, 2014; more will take effect August 1, 2014. To learn how WESA may impact your workplace, please contact me at taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2014 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

June 26, 2014

Supreme Court invalidates President’s NLRB recess appointments

Posted in Uncategorized, National Labor Relations Act, Collective Bargaining, Posting Requrements, Protected Concerted Activity, Social Media tagged , , , , , at 1:52 pm by Tom Jacobson

In a 9-0 decision, the United States Supreme Court today struck down as unconstitutional President Barack Obama’s January, 2012 recess appointments to the National Labor Relations Board (NLRB). The decision calls into question the validity of hundreds of decisions made by the NLRB from January, 2012 to August, 2013.

The case, National Labor Relations Board v. Noel Canning, involved the NLRB’s determination that Noel Canning had committed unfair labor practices under the National Labor Relations Act. Noel Canning challenged the NLRB’s authority to make such a determination on the basis that the board itself was improperly constituted at the time of its decision.  Specifically, Noel Canning argued that President Obama’s three appointments to the board in January, 2012 were unconstitutional because he made them without the advice and consent of the Senate. The Supreme Court sided with Noel Canning.

The fallout from the high court’s decision is uncertain, but it could mean that hundreds of decisions made by the NLRB while the board was unconstitutionally composed will be invalidated.

For more information about this article, please contact me at alexandriamnlaw.com or  taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2014 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

May 12, 2014

Seminar to address Women’s Economic Security Act

Posted in Care of Relatives Leave, Discrimination, Domestic violence, Equal Pay, Family and Medical Leave Act, Family and Medical Leave Act (FMLA), Family Leave, Gender / Sex, Leaves of Absence, Leaves of Absence, Minnesota Parenting Leave Act, Nursing Mothers, Parenting Leave, Pregnancy, Reasonable Accommodation, Sick or Injured Child Care Leave tagged , , , at 8:40 am by Tom Jacobson

Gov. Mark Dayton yesterday signed into law the Women’s Economic Security Act. Among other things, the new law will expand leave rights for many Minnesota employees. The new law will be covered in detail at the Eleventh Annual West Central Minnesota Employment Law Update to be held on Thursday, June 12, 2014 at Alexandria Technical and Community College.

The event has been approved for 6.0 HRCI credits. For complete details on the seminar, go to 2014 Employment Law Update Agenda. To register, go to 2014 Employment Law Update Registration.

For more information about this article, please contact me at alexandriamnlaw.com or taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2014 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

May 9, 2014

Legislative update: MHRA jury trials and Women’s Economic Security Act advance

Posted in Care of Relatives Leave, Court Trial, Discrimination, Domestic violence, Family and Medical Leave Act, Family and Medical Leave Act (FMLA), Family Leave, Jury Trial, Leaves of Absence, Nursing Mothers, Parenting Leave, Remedies, Sick Leave, Sick or Injured Child Care Leave tagged , , , , , , , , , , at 9:26 am by Tom Jacobson

Both houses of the Minnesota Legislature on May 8, 2014 took action to advance legislation which, if signed into law by Gov. Mark Dayton, will have significant impacts on Minnesota employers and employees.

First, with a 43-24 vote the Senate approved the Women’s Economic Security Act (HF2536) which, among other things, would expand parenting and sick leave rights. For more information on this bill, see Women’s Economic Security Act Passed by MN House.

Then, with a 79-51 vote the House approved the Senate’s amendment to the Minnesota Human Rights Act (MHRA) (SF 2322). This amendment would add the right to a jury trial as a remedy under the MHRA. For more information on this bill, see Minnesota Senate Adds Jury Trial Right to Minnesota Human Rights Act.

For more information about this legislation, please contact me at taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2014 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

May 6, 2014

MN Senate adds jury trial right to Human Rights Act

Posted in Court Trial, Discrimination, Jury Trial, Remedies tagged , , , , , , at 9:14 am by Tom Jacobson

SF 2322By changing a single sentence in the Minnesota Human Rights Act (MHRA), the Minnesota Senate on May 1, 2014 passed a bill which, if it becomes law, will significantly change the way MHRA disputes are decided in the courtroom.

Currently, the law (Minn. Stat. § 362A.33, subd. 6) provides that, “Any action brought pursuant to this chapter shall be heard and determined by a judge sitting without a jury.” However, the Senate’s version (SF 2322), which passed on a 55-0 vote, would change that sentence to read, “A person bringing a civil action seeking redress for an unfair discriminatory practice or a respondent is entitled to a jury trial.”

The change would be significant, for it would drastically change the way MDHR cases — such as claims for employment discrimination — would be litigated. Generally speaking, jury trials are far more expensive and complicated than are cases tried to a judge alone. A jury of six people can also be far more difficult to predict than a single judge. The change would, however, make state law consistent with its federal counterpart (Title VII of the Civil Rights Act of 1964), which already allows for jury trials.

For more information about this article, please contact me at alexandriamnlaw.com or  taj@alexandriamnlaw.com.

The comments posted in this blog are for general informational purposes only. They are not to be considered as legal advice, and they do not establish an attorney-client relationship. For legal advice regarding your specific situation, please consult your attorney.

Copyright 2014 Swenson Lervick Syverson Trosvig Jacobson Schultz, PA

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