Tag Archive for 'employees'

California Supreme Court: Managers Do Not Need to Ensure That Employees Take Breaks

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California has a long history of liberal and progressive politics, particularly when it comes to protecting the rights of employees. And while the state legislature has passed a wide range of laws meant to protect employees, the California Supreme Court has also played a significant role in the development of many employee-friendly policies that California employees often take for granted.

So, a recent ruling from the state’s high court comes as something of a surprise, whether you agree with the ruling or not. The Court held that California employment law does not require employers to make sure that employees actually take the breaks to which they are legally entitled.

It’s important to note that the right of all employees in California to take at least a 30-minute meal break during a standard shift, and their right to two 10-minute breaks for every four hours worked, has not been affected. If an employer were to try and stop an employee from taking their legally-mandated breaks, there would be trouble.

What the state Supreme Court did here was resolve a question that, until now, created some uncertainty for employers. The law was not clear on whether or not employers had to actually order their employees to take the breaks to which they are entitled.

In its ruling, the court essentially says that, while employers are required to offer a minimum amount of break time to their employees, the law cannot dictate what the employees actually do with that time, and if they choose to spend it working, that is their right.

I’m of two minds about this decision. On one hand, I think it leaves the door wide open for abuse, especially of employees who don’t know much about their rights under California employment law. An employer could simply “forget” to inform his or her employees that they’re entitled to breaks, and if they eventually get sued for failing to offer their employees break time, they could simply claim that the employees chose to work through their breaks. And in many cases, it would be difficult to prove otherwise.

Groups that advocate for strong protections for workers are understandably concerned that this ruling could turn into an easily-exploitable loophole in California’s worker protection laws, which are otherwise some of the strongest in the country.

On the other hand, I recognize that it would be impractical for the law to micromanage the behavior of employees on their breaks, and while the law should protect employees, ensuring that they are paid at least a minimum wage, that they have a reasonably safe work environment, and that they have breaks to ensure that they don’t become overly fatigued on the job. All of these protections tend to be good for both employees and employers in the long run. The benefits for the employees are obvious. But for the employers, having healthy employees who aren’t fatigued because they’ve been working non-stop for 10 hours can actually save them money, mostly by reducing the rate at which accidents occur, thereby reducing workers’ compensation expenses.

However, the law cannot accomplish these goals by micromanaging every little detail of how employers implement them. Doing so would be expensive, impractical, and would probably bury employers and employees in unnecessary bureaucracy.

So, how do I feel about the California Supreme Court’s ruling in this case? Honestly, I doubt it will change much for the vast majority of employees. The fact is, the majority of employers in California make a good-faith effort to comply with federal and state employment law, and probably took steps to ensure that their workers took the breaks to which they are legally-entitled.

And it’s important to note that if this ruling has a significant negative impact, with abuses taking place at a much higher rate than expected, the state legislature can always update the law to overrule the Supreme Court on this issue.

After all, in this case, the court was simply interpreting the law passed by the state legislature. If this ruling has unintended effects, or the legislature believes that the court made the wrong decision, they can simply change the law to make it clear that employers are, in fact, required to ensure that their employees actually take their breaks.

However, I doubt that this will prove necessary.

As I said, I think that most employers will not change their practices in response to this ruling.

As long as employers are clear that this ruling does absolutely nothing to compromise the rights of their employees to take breaks, and are certain to inform their employees that they have a right to take breaks, and do not try to stop them from doing so, things should be fine.

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Famous Designer Alexander Wang Faces a Lawsuit Based on Labor Law Violations

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It is no secret that employers often violate labor laws; add to this list (allegedly) top fashion designer Alexander Wang.  Famous casual sportswear fashion designer Alexander Wang is being sued for allegedly providing unsafe working conditions for his employees at his New York Office.

A $50 million dollar civil action suit has been filed in the Queens Supreme Court.  Employees such as FlorDuante are claiming that Wang provided unsafe working conditions, overworked his employees with approximately 90 hour/week shifts, and wrongfully terminated them after the employees had filed a workers compensation complaint against him.

Wang’s corporation claims that they adhere to labor laws, especially laws related to wages, overtime, and safe environment.  Briefly, employment law wants to ensure that employees have safe working conditions, work reasonable hours and do no face discrimination or wrongful termination.  Safe working conditions emphasize employers to provide working environments where chances of work-related injuries are minimal and all the necessary injury-preventative measures are provided to employees.  For instance, making sure that the floors stay clean so that no one can slip, or offering masks or gloves if employees are required to operate heavy and/or dangerous machinery.

Employers are also required to ensure that employees are being paid for all hours worked, and that the hours be reasonable with the employees taking at least two fifteen minute breaks in which they have physically stepped away from their desk.  Additionally, employers must make sure that there is no harassment or discrimination going on in the work place.  Taking preventative measure such as anti-discrimination or anti-harassment workshops, or having company policies explicitly stating a “no tolerance for discrimination or harassment” policy is a very good idea.  Alongside these conditions, employers must also remember that although most places employ at-will, this does not mean that employees can be fired based on acts such as complaining about labor law violations.

In lawsuits such as Wang’s, it is very rare that employers walk away having to pay nothing.  Mostly, employers want to settle such suits to avoid investing time and money in litigation.  Therefore it is likely that Alexander Want will have to pay damages to these employees, and it is likely that the damages amount will be well-negotiated by the attorneys representing both parties.

There are probably ways to avoid such instances.  Many companies are now placing video cameras and time card machines that record employees’ daily routine, movements, and timings.  Of course, such measures are implemented legally by giving employees notice before implementing such procedures.  Such efforts can help employers either defend themselves against lawsuits or force them to abide by labor laws.  Many corporations do in fact implement such measures for these reasons.

However, in the past and even the present, the fashion industry has had a lot of problems due to accusations of labor law violations.  Either companies in the fashion industry should implement such measures as well, or industry heads should look to lawsuits like Wang’s and realize that if they do not conduct their operations legally, adverse consequences will follow.

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Helpful Legal Hints for Employers

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A lot of HR departments have trouble with some basic legal issues.  TheWashington Post recently wrote an article for small businesses on how to handle some common “HR nightmares.”  The article lists the following as common issues employers tackle:

  • Misclassifying Workers
  • Overtime
  • Breaks
  • Firing Procedures
  • Discrimination and Harassment

Below are some suggestions on how to handle such issues:

Am I Dealing With an Employee or Independent Contractor?

It is very important for employers to understand the difference between an employee and an independent contractor.  Basically, if an individual has control over their hours, working instruments, and method of work they are an independent contractor.  If an employer sets the hours, provides instruments and strategies procedures/working methods, an employer is dealing with an employee.  There are numerous lawsuits every year because employers have violated labor laws by treating an employee as an independent contractor, or vice versa.

The best thing to do is to read the labor law of your state, extract the definitions set forth for “employee” and “independent contractor,” and refer to it before classifying an employee.  Such small efforts can easily avoid later litigation. 

Overtime—To Pay or Not to Pay?

Since these laws vary state to state, it is important for every employer and/or HR department to understand its state laws on what is considered overtime, and when to pay it.  There are also tricky nuances.  For instance, California views an employee working over eight hours per day as overtime.  However, over forty hours per week is also considered overtime.  Many lawsuits have arisen because employees, who have wanted longer weekends, agreed to work over eight hours a day Monday through Thursday, in order to have Friday off.  Although the amount worked totaled forty hours per week, since employees were working over eight hours a day, labor laws required them to be paid for overtime.

A lesson to take from this is that when reading laws, pay attention to conjunctions such as “and” or “or,” because they hint towards small nuances, which, if not followed, can lead to litigation. 

Breaks—Employees Need to Step Away from Their Work.  It is the law!

It is very important for workers to take proper breaks.  Some workers choose to eat lunch at their desks or skip break because “they have too much to do” or are “almost finished with something.”  Sometimes, employers themselves are in meetings with employees, these meetings run long, and break time passes.  Employers often then encourage everyone to “get back to work” rather than instruct them to go out and make up their break time.  Such behavior from both employees and employers can get employers into trouble.  Why?  Later on, these same employees may claim to have been working diligently during their allotted break times, bringing employers into trouble for violation of labor laws.

What to do?  A lot of companies now have break rooms where no work can be conducted, or require workers to leave the premises during their breaks.  This is a great idea.  Overall, employers need to be proactive and ensure that employees take breaks.  If in a meeting, employers should be conscious and either announce a break during the meeting, or instruct employees to take their break after the meeting is over.  Otherwise, employers should create break rooms and/or have signs up that require employees to physically leave the office area during allotted break times. 

Firing Procedures

The major issue here is that employers establish firing procedures in the company handbook, and do not follow them.  This gives employment lawyers ample ammunition against you in court.  For instance, perhaps the company handbook will state that there will be a review process with the Board of Directors before firing someone.  However, that was not followed when an employee was terminated.  This can get employers into trouble.

To stay away from litigation, follow the procedure your company has established when firing someone.

Discrimination and Harassment—What Employers Think It is and What the Law Says It Is May Be Different

Most of the time, discrimination and harassment are not obvious.  Small comments on appearances guised as “compliments,” or harsh words with multiple meanings during a heated conversation can be discrimination or harassment.  People often associate extreme cases with these concepts; however discrimination and/or harassment instances can be subtle acts in workplace communication.  Many HR departments and employers do not understand this.

A great solution is to first understand the statutory meaning of these two terms.  Then, along with the usual description and “no tolerance policy” written in most corporate handbooks, it is a great idea to have a workshop for employees and management personnel on discrimination and harassment in the work place.  This not only will educate one’s work force, but will also make the company’s “no tolerance” policy clear to everyone.  Such small efforts are a great way to avoid any potential lawsuits. 

Of course there are more solutions to tackle these problems.  Employers should educate themselves and their HR departments, and have lengthy discussions with the corporate attorney(s) to ensure that the company is protecting itself from any potential lawsuits.   This article has some suggestions, and meeting with your corporate attorney will definitely yield more!

Zynga Demanding that Employees Return Stock Or Be Fired

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If you’ve used Facebook at any point in the last few years, you’ve probably noticed your news feed getting clogged up with messages like “Bob just harvested 12 bushels of kumquats in FarmTown” or something similar. These simple, addictive games have proven to be a cash cow for a few companies. And the undisputed king of so-called “social gaming” is a company called Zynga. They make games like Mafia Wars and Farmville.

The people who founded the company, as well as its top executives, are now fabulously wealthy. However, like just about every successful tech company, Zynga was once a plucky startup with limited funding, and its future prospects were far from certain.

Cash-strapped startups, in a bid to attract the best possible talent, often offer new hires stock options, to supplement below-market salaries. Presumably, this is also meant to encourage these new hires to work hard to help the company succeed, and to attract employees who honestly believe in the company’s long-term success, by essentially forcing them to bet on it.

This has led to some relatively low-level employees (like secretaries and cooks) who got into a startup on the ground floor who end up with multimillion dollar windfalls when the company goes public. One famous example is a chef who was hired in Google’s early days ending up with $20 million when the company went public in 2004. Zynga, apparently, wants to avoid situations like this.

Basically, in anticipation of an initial public offering, Zynga appears to be looking at employees whose contributions to the company they don’t believe warrant a potentially-huge financial windfall. The company is telling them to give back their stock, or lose their jobs.

The company claims that they gave out too much stock to employees in the early days, and now they don’t have enough unvested shares to give out to attract top talent.

I honestly am not knowledgeable enough on the subject to say if this is legal or not. But, it seems like these employees are getting an incredibly raw deal. The whole reason that stock options are a good way to attract top talent in a company’s early days is that they offer the promise of a huge financial windfall a few years down the line, if the company is successful. It seems incredibly shortsighted for a company like Zynga to go back on this deal now that it’s inconvenient.

After all, stock options won’t be nearly as effective in attracting new employees if they have reason to suspect that they’ll be asked to give their shares back, or be fired, as soon as it’s convenient to the top executives in the company. Furthermore, actions like this will serve as a disincentive for employees at startups to put in the long hours and personal sacrifice that are usually required to turn a startup into a successful business. After all, how hard would you work to make a company successful if you know that your bosses might take away your major reward for doing so (your now-valuable stock options).

Of course, this maybe could have been avoided if the employees had pushed for a contract stating that the employer would not be able to pull this kind of move. Now that Zynga has set this precedent, prospective employees at other startups might start pushing for terms in employment contracts stating that they cannot be forced to give up their stock options as a condition of continued employment.

In this economy, it may seem that prospective employees aren’t in much of a position to be making demands of their employers, but with startups, the situation is a little different. Unless they’re flush with venture capital funding, tech startups often operate on a shoestring budget. Their need to attract talent, and the limited incentives they have to offer, give talented employees a good deal more leverage over their employers than the average worker has.

Employment is generally “at-will,” meaning that employees can be terminated for any reason, or no reason at all (presumably including failing to give back their stock options). However, this is the default arrangement, and it can be modified by contract. Of course, both parties have to agree to the terms of a contract for it to be valid, which is why employment contracts are relatively rare in non-unionized workplaces: the employer has little to gain by signing an employment contract which will almost certainly limit their rights to fire employees bound by the agreement.

But as I said, the situation with startups is different. Their employees have leverage. Hopefully, they’ll take this case as an object lesson in flexing their leverage, so situations like this don’t happen in the future.

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Hertz Suspends Muslim Workers For Praying On The Job, Lawyers Rub Hands Menacingly

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Here’s an urgent news alert to those flying into Seattle in the near future and looking to take a Hertz shuttle bus.  Be prepared for delays because the company’s local management there felt like making the news by indefinitely suspending 34 of its Muslim employees for praying on the job.

Hahaha, just kidding, about the delays anyway.  I mean, when was the last time a multi-million dollar company was slowed down by the loss of 34 workers?  Because as we all know, only the really important stuff gets the big layoffs, but I digress.

Anyway, the clash between the Seattle branch of Hertz and its Muslim employees boiled over last week when according to reports, a Hertz manager told an employee (while, I assume, twirling his mustache and draped in a black cape and top hat), “If you guys pray, you go home.”  The comment was said right before the employees were preparing to say their prayers.  The argument stems from the supposed existence of a new company policy that the employees’ union had negotiated with Hertz that allowed the employees to pray without having to punch out first.  Hertz claims no such policy exists and that though their employees are free to exercise their religious beliefs, they aren’t entitled to be paid for the time spent doing so.  And that time can add up considering the devout Muslim employees pray five times a day.

Though it’s uncertain whether or not the dispute will be settled in the near future and the employees will be taken off suspension, what is certain is that, like death and taxes, lawsuits and religious persecution always go hand-in-hand.  And it wouldn’t surprise me if one springs forth from this mess before the dust settles.  Taking a look at the comments left by readers in the blogosphere and it becomes apparent that most people are thinking the same thing; unfortunately it’s mostly wrong.

Although it’s still blindingly obvious that legal action will be taken, the lead argument in it probably won’t be what most people assume it to be, and that is a lawsuit based on unconstitutional freedom of religion discrimination based on the establishment clause of the First Amendment.  The winner in this case will actually be a breach of contract dispute.

The reason is because despite the fact that the First Amendment protects freedom of expression and the establishment clause within it ensures that the government cannot endorse any religious view, whether it be positive or negative, the problem is that Hertz is not a government entity, but rather a private corporation.

You see, with the exception of some very limited parts of the Constitution, such as the Thirteenth Amendment’s prohibition against slavery and indentured servitude, the protections given by the US Constitution only apply when the violator is the state or federal government.  Hopefully that last statement didn’t surprise too many people, otherwise our country’s educational system has got a lot of splainin’ to do.

In order to sue for a violation of the Constitution, one must first establish that the issue at hand must meet at least four requirements (there are more, but these four generally apply universally to both state and federal courts).  The issue must be ripe: that it has or will cause harm or has a likely chance of doing so in the near future.  The issue cannot be moot: it’s already been resolved.  It cannot be a political question, meaning an issue that the legislative branch of our government should decide.  And the party suing must have standing to sue: he or she must show that he/she were harmed by the actions caused by the defendant, that the court can actually cure the party’s harm, and that the defendant is either the government itself or what is called a “state actor.”

A state actor is essentially a private party that is conducts itself with either the express or implied authorization of the government, so much so that the government becomes entangled with the private entity to the point that the private entity may be considered an extension of the government’s actions itself.  Despite what the name implies, state actor status can be applied on both a state and federal level.  It’s a simple concept, one that law professors like to make sound extraordinarily complicated (probably to justify keeping their jobs).

Anyway, Hertz certainly caused the employees harm by not paying them for praying at work and the court can definitely cure this harm by forcing Hertz to pay them for their loss work hours.  The problem is that Hertz is not a government actor.  Sure an argument can and has been made many time over that those providing transport are providing an essential government function.  But that argument won’t fly here because Hertz doesn’t have an exclusive contract with Seattle to be the sole airport transport company; there are plenty of other bus companies doing the same thing.

Though if this case were somehow able to make it pass the lack of standing issue, it’d be interesting to see how this one would play out.  Right now the law says that equal enforcement of a policy restricting behavior, even if it’s religious behavior, that is neutral in respect to religion, is constitutional.  However, there are also a few old cases that rule that the government can’t refuse to pay workers unemployment if they are fired due to their inability to work during certain times due to their religious belief.  Yes, the workers at Hertz haven’t been fired yet, but it’d be interesting nonetheless to see how the lawyers would’ve tried to weasel through with that one.

In any case, if you happen to know any of the Hertz workers in this predicament please be sure to send them a card if the worst happens, because apparently there really is one for every occasion now.

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