New Jersey Employment Law Blog

Anyone Want Coffee? Workers' Comp Will Pay!

An employee injured on a five mile drive to get coffee was found by a NJ comp court to be eligible for comp benefits. Here's the story.

Actually, it's not that unusual a ruling. I just couldn't resist the chance for the headline.

Business Reasons to Hire a Lawyer --- and Not Fear the Cost

Here's a useful article written for the small business owner about when you should call a lawyer. It lists such things as starting a business (and developing an exit strategy), collecting debts, and resolving business disputes. The common thread is that it makes far more sense to get legal help from the beginning, rather than wait for something to go wrong before seeking advice. It is almost always less expensive to get help up front. The reason is simple. Wait until a problem develops and you're asking me to unscramble eggs. Putting together the ingredients to make an omelet is easier, controllable, efficient, and more satisfying.

I would add to the article's list a few employment-specific reasons to get legal help at an early stage. These include firing someone, offering severance benefits, and drafting or evaluating non-compete agreements. My pet peeve is employee handbooks. As I've ranted before, no matter what you may hear, no matter what "foolproof" generic forms you may find on the internet, in New Jersey drafting an employee handbook is not a game for do-it-yourselfers. Just get help from the outset. It's not expensive and you'll save yourself many headaches down the road.

One other point that the article makes deserves emphasis. Law firms increasingly are moving away from hourly billing, so the days of open-ended legal expense are drawing to a close. Most lawyers will be happy to work with you to find the most cost-effective way to solve your problem. Most of us are interested in developing a long-term relationship with you, not maximizing our take on one project. All kinds of alternatives to hourly billing are being used, and they will give you comfort about the price that you will pay for a service. Don't be afraid to ask, and don't be afraid to walk away from a lawyer who won't discuss the subject with you.

Law Against Discrimination Prohibits Sexual Advances by Supplier Against Female Business Owner

JT's Tire Service v. United Rentals is not, strictly, speaking, an employment law case. But it affords us an interesting look at an unusual issue under New Jersey's Law Against Discrimination, the linchpin of employment discrimination litigation in the great Garden State. As you will see, this opinion merits the attention of every business in New Jersey.

The facts are simple. JT's Tire Service is owned by Eileen Tortorello. JT's sold industrial tires to the United Rental branch in Piscataway starting in 1998. In 2005 Hinckes, who managed the Piscataway branch, began to pressure Tortorello for a sexual relationship. She refused and United stopped buying tires from JT's. Tortorello got United's work back when she agreed to have lunch with Hinckes, but he continued to threaten her with the loss of business. His advances became physical. Payments due to JT's from United were delayed, and eventually ceased altogether.

JT's sued under a section of the LAD which makes it unlawful to discriminatorily refuse to do business with another on the basis of sex (among other things).

The trial court dismissed the complaint on the theory that United's refusal to do business with JT's was not "on the basis of sex."

The Appellate Division reversed and reinstated the complaint. The court noted that sexual harassment is a form of sex discrimination and rejected the defendant's argument that Tortorello, as the owner of a business separate from United Rentals, did not need protection from sexual harassment. The court found that quid pro quo sexual harassment violates the LAD even when the victim is not an employee but someone who is doing business with the harasser.

So the next time you get the idea that you can safely make advances to a supplier --- and threaten to withhold business if you don't get what you want --- think again. At least in New Jersey, it's against the law.

Management Showdown: Scrooge v. Fezziwig

I love Dickens's "A Christmas Carol" and read it every Christmastide. Marylee Abrams at Minnesota Labor & Employment blog has this interesting post, which is particularly apt for the season. I can't improve on it, so I won't try. I'll only note the obvious: Scrooge, not Fezziwig, started as the richest man in town. And at the end he was giving his money away.

Off-topic, years ago I did some canoeing in Minnesota's Boundary Waters Canoe Wilderness. The graphic on Marylee's blog got me thinking that it would be fun to stage a return trip. But I think I'll wait for the summer.

Steinberg Installed as Business Partnership Chair

Frank Steinberg of Steinberg Law Offices was installed on December 9 as chairman of the Somerset County Business Partnership. His term will be for one year. The Business Partnership has more than 600 member companies that range from the Fortune 500, to national and regional banks,small family businesses and professional practices. The Business Partnership is the only certified Chamber of Commerce in New Jersey, and is well-known among local, county, state and federal lawmakers for its effective advocacy of public policy initiatives. It is also an acknowledged authority in advocating for collaborative action among governmental units.

Link here to the Courier-News story on yesterday's annual meeting.

While you're at it, take a look at the Partnership's web site. It's a terrific organization and one that I'm proud to be associated with.

Job-Seeking Strategies for Older Workers

For those newly unemployed who are getting on in years, remember that the business world remains full of possibilities for you. Here's a helpful article from the Wall Street Journal geared to the older job seeker.

Why CEO's Need to Know About the Law

We've explained from time to time why, as part of the public service that this blog provides, we report on court decisions, which you might think to be just "lawyer stuff." In fact, they're much more than that. Each case represents a little drama that has been enacted in real life. Each tells the story of an unexpected problem, a risk taken, maybe a misunderstanding. By studying the ramifications of such problems, risks and misunderstandings, we all can learn to adjust our own behavior and decision making to minimize similar problems in our own lives. In short, it helps us to learn from others' mistakes.

So in preparing for this, my 300th post on this blog, I was glad to run across this post from Steve Tobak at The Corner Office blog. I had never seen Steve's blog before, but I'll be back for more. (Among other things, anyone who admits in public that he likes to drive his wife crazy is my kind of guy!) Written from the life experience of a non-lawyer executive, Steve emphasizes the need to understand the legal system. He begins with this provocative statement:

If your career or business is untouched by significant legal matters, then you probably don’t have much of a career or business. We are a nation of laws, and any senior executive or business leader who’s been around will tell you: turn a blind eye to the legal system and you risk everything. Like it or not, that’s the way it is.

Steve lists a dozen broad categories of legal involvement that he's had in his career, employment law among them.

We lawyers sometimes feel like professional nags, always warning clients about things that may not even be problems --- yet. It's nice to be validated by someone who's sat on the other side of the desk. But more important, it's good advice to be prepared. As Steve said so bluntly: "turn a blind eye to the legal system and you risk everything. Like it or not, that's the way it is."

Take a minute to read the rest of Steve's thoughts on the subject. They're short but valuable to anyone in business.

On-the-Job Hazards: Flight Attendant v. Air Marshal

In reviewing the news for bloggable material we come across some strange stuff, but this is pretty unusual.

You'd think that it wouldn't be a fair fight. And, come to think of it, maybe it wasn't.

A Lot of Kung Pao Chicken Indeed

Michael Fox at Jottings By an Employer's Lawyer reminds us that wage and hour litigation is an increasing problem for business. The latest involves a $2 million (yes, "million") order to pay back wages and penalties to employees. The offenders? A husband and wife team who own 5 Chinese restaurants in Grandville, Michigan. Mike's analysis is amusing and apt: "It will take a lot of kung pao chicken to cover that fine."

No kiddin'.

Big Age Discrimination Award

Law.com has this report of a $6.2 million verdict in favor of two Pennsylvania scientists formerly employed by PQ Corp. Both had been terminated in a downsizing. The jury found that PQ discriminated against them because of their age.

This case illustrates things that are worth remembering, whether you are an employer or employee.

First, the jury found that PQ's discrimination against the scientists was willful. That resulted in a doubling of the back pay that they were due.

Second, the jury apparently accepted the plaintiffs' argument that PQ "cooked the books" to make it look like they were downsized for financial reasons unrelated to their age. Trial lawyers know that if a jury thinks that you're lying, they will come down hard on you. That seems to have happened here.

Third, $6.2 million is not the end of PQ's financial trouble. Motions are pending for attorney's fees, which certainly will run into six figures, and to gross up the award so that the plaintiffs do not suffer from having all of that income taxable to them in one year.

Downsizings are difficult on many levels. Companies need to be sure that their age-related analysis of the impact of the employees selected is done fairly and honestly, and not merely to justify management's desire to get rid of age-protected employees.

Supreme Court Decision Will Affect Location of Many Business Lawsuits

Hertz v. Friend, when decided by the US Supreme Court, will decide one of those issues --- where is a corporation's principal place of business for jurisdictional purposes? --- that seems almost silly from a common sense perspective. That hasn't kept the federal courts from adopting different approaches that have led to vastly different results.

The answer to the question has important consequences in the real world. It governs what federal courts will be available to plaintiffs in all kinds of cases. This one happens to involve wage and hour issues, but it will apply to commercial disputes across the board.

Another problem, which (gratifyingly) a couple of Justices focused upon at oral argument, is the potential for catastrophic cost to plaintiffs, who in terms of financial resources play the role of David battling Goliath, if a simple rule to define "principal place of business" is not adopted.

Here's a report from Law.com that covers the case in more detail, and this link will take you to the transcript of yesterday's oral argument. Justices Sotomayor and Ginsburg were particularly active in the discussion. Justice Scalia, as usual, drew the best laughs.

How will the court decide? My guess is that "principal place of business" will mean the corporation's headquarters, unless is can be proven that the headquarters is a sham or shell.

Dumb Excuses for Missing Work - Vol. 1

"Oh what tangled webs we weave,

When first we practice to deceive."

So Sir Walter Scott told us in Marmion. (Yes, I too thought it was from Shakespeare, but a little research quickly disabused me of that notion.)

Aaron Siebers, a Blockbuster employee in Colorado, apparently missed the class that covered the consequences of deception and tangled webs.

In a nutshell, Mr. Siebers went skateboarding before reporting to work, while wearing his uniform pants. He fell and ripped them. Concerned about the potential consequences to his employment of reporting to work in torn trousers, he tried to solve the problem by stabbing himself in the leg. With a knife. Really. And he called the police and told them that he had been attacked by three men, explaining the wound.

The police quickly determined that Siebers' story was as full of holes as his pants.

Siebers has been criminally charged with filing a false report and obstructing police. We don't know whether he got fired, but employment may be the least of his problems now.

Here's the full story, courtesy of The Smoking Gun.

Revised Posting Requirment - November 21 Deadline

A revised "Equal Employment Opportunity Is the Law" poster must be used by businesses with 15 or more employees, effective November 21. You can print the poster from the EEOC website.

The revisions add information to take account of the the Genetic Information Nondiscrimination Act of 2008 and recent changes in disability regulations.

Defecting Employees Destroy Successful New Business

Here's what happened to Charter Oak, a successful new mortgage business that didn't protect itself from its own employees. Ten of them left as a group for a larger competitor, allegedly stole files and pending deals, and basically decimated the business. Lacking non-compete, confidentiality, and non-solicitation agreements, Charter Oak lost in court. The case is now on appeal.

It makes you think, doesn't it? Doubtless caught up in the euphoria of establishing a new business, Charter Oak's principals failed to plan for the worst and are now paying dearly for the oversight.

We present many of our posts as life lessons on what can happen if you don't do things the right way. Charter Oak's situation is about as graphic an example as we have found.

Some Good Thoughts from California on Social Security Mis-Match Letters

Here's a good post from the left coast, specifically the California Labor & Employment Law Blog, on how employers should respond to Social Security mis-match letters. There have been some changes in the law, and it's worth reading, especially by employers, who have an obligation to resolve discrepancies or face liability.