Supreme Court Rules 6-2 Against Tyson -- Workers Win Millions in Back Pay

Supreme Court Rules For Workers in Pay Dispute

Supreme Court Rules For Workers in Pay Dispute

In a victory for American workers, the Supreme Court last week upheld a $5.8 million judgment against Tyson Foods in a pay dispute with more than 3,000 workers at a pork-processing plant in Iowa. You can read the opinion in Tyson Foods v. Bouaphakeo here.

The justices voted 6-2 on to reject new limits Tyson asked them to impose on the ability of workers to band together to challenge pay and workplace issues. The case revolved around the question of whether the workers could bring a class action case. Tyson argued that since each employee spent a different amount of time putting an gear and removing it, they shouldn't be able to sue as a group using "representative evidence" to prove up their case. The court rejected that argument.

“In many cases,” according to the Court majority opinion, “a representative sample is ‘the only practicable means to collect and present relevant data'” to prove that the company being sued was legally at fault.   The opinion went on to provide some guidance to when such evidence would be allowed in such cases.

In this case, the Court was more content to allow such evidence because Tyson Foods had not obeyed its legal duty to keep records on how much each worker had worked as overtime.  Without such records, the employees had to marshal other evidence, and the sample was the best proof available to them.

The case is notable because it represents at least a small opening in the legal wall against group actions that the Supreme Court has been steadily building over the last several years.

Read more:

Uber Drivers File FLSA Class Action in New York

FLSA Wage Action Against Uber

FLSA Wage Action Against Uber

On June 2nd, the New York Taxi Workers Alliance filed a class action complaint on behalf roughly 5,000 New York City Uber drivers against Uber Technologies and its related entities.  The complaint alleges that Uber’s drivers are misclassified as independent contractors and that Uber’s compensation scheme falls far below statutory minimum wage and overtime requirements.

According to the complaint, Uber exercises sufficient control over their “independent contractors,” to qualify them as employees:

From fares and fees, to what to wear and what route to take, in addition to subjecting its employees to constant monitoring by GPS, Uber directs and sets the terms and conditions of their Drivers’ work. Although Uber’s rules are often described as “suggestions,” Drivers understand clearly that failure to follow these guidelines results in temporary or permanent termination of their employment with Uber. After working for Uber continuously for years, laboring for twelve-hour-plus shifts, for six or seven days a week, these workers simply cannot be considered independent contractors performing a “gig.”

The complaint contains claims for minimum wages and overtime under the FLSA, recovery of equipment costs, unlawful deductions, breach of contract, and promissory estoppel.

You can read a copy of the filed Complaint here.

Tort Reform Is A Lie: Hot Coffee Still Being Used to Mislead

Here's the lie:

The lies used to support corporate efforts to continue to restrict regular people's access to the courthouse are powerful. And, sadly, they work. Routinely, potential clients who are sitting in my office will reference the famous McDonalds "Hot Coffee" case and try to assure me that their case isn't like the Hot Coffee case.  Their case is real. 

Here's the thing, the story everyone knows about the Hot Coffee case is a myth. It's a lie pushed by big business and their tort "reform" groups to poison the minds of potential jurors and make it harder for those who have been legitimately injured to received fair compensation. 

So, What Happened?:

In 1992, 79-year-old Stella Liebeck bought a cup of takeout coffee at a McDonald’s drive-thru in Albuquerque and spilled it on her lap. She sued McDonald’s and a jury awarded her nearly $3 million in punitive damages for the burns she suffered.

Before you hear all the facts, your initial reaction might be "Isn’t coffee supposed to be hot?" or "McDonald’s didn’t pour the coffee on her, she spilled it on herself!" But that would be before you hear all the facts.

Here are the facts:

Mrs. Liebeck was not driving when her coffee spilled, nor was the car she was in moving. She was the passenger in a car that was stopped in the parking lot of the McDonald’s where she bought the coffee. She had the cup between her knees while removing the lid to add cream and sugar when the cup tipped over and spilled the entire contents on her lap.

The coffee was not just “hot.” It was very dangerously hot. McDonald’s policy was to serve it at an extremely hot temperature that could cause serious burns in seconds. Mrs. Liebeck’s injuries were far from minor. She was wearing sweatpants that absorbed the coffee and kept it against her skin. She suffered third-degree burns (the most serious kind) and required skin grafts on her inner thighs and elsewhere. (See the video above for pictures.)

Importantly Mrs. Liebeck’s case was far from an isolated event. McDonald’s had received more than 700 previous reports of injury from its coffee, including reports of third-degree burns, and had paid settlements in some cases.

Mrs. Liebeck offered to settle the case for $20,000 to cover her medical expenses and lost income. But McDonald’s never offered more than $800, so the case went to trial. The jury found Mrs. Liebeck to be partially at fault for her injuries, reducing the compensation for her injuries accordingly.

But the jury’s punitive damages award made headlines — upset by McDonald’s unwillingness to correct a policy despite hundreds of people suffering injuries, they awarded Liebeck the equivalent of two days’ worth of revenue from coffee sales for the restaurant chain. Two days. That wasn’t, however, the end of it. The original punitive damage award was ultimately reduced by more than 80 percent by the judge. And, to avoid what likely would have been years of appeals, Mrs. Liebeck and McDonald’s later reached a confidential settlement for even less than that.

Here is just some of the evidence the jury heard during the trial:  

  • McDonald’s operations manual required the franchisee to hold its coffee at 180 to 190 degrees Fahrenheit.

  • Coffee at that temperature, if spilled, causes third-degree burns in three to seven seconds.

  • The chairman of the department of mechanical engineering and biomechanical engineering at the University of Texas testified that this risk of harm is unacceptable, as did a widely recognized expert on burns, the editor-in-chief of the Journal of Burn Care and Rehabilitation, the leading scholarly publication in the specialty.

  • McDonald’s admitted it had known about the risk of serious burns from its scalding hot coffee for more than 10 years. The risk had repeatedly been brought to its attention through numerous other claims and suits.

  • An expert witness for the company testified that the number of burns was insignificant compared to the billions of cups of coffee the company served each year.

  • At least one juror later told the Wall Street Journal she thought the company wasn’t taking the injuries seriously. To the corporate restaurant giant those 700 injury cases caused by hot coffee seemed relatively rare compared to the millions of cups of coffee served. But, the juror noted, “there was a person behind every number and I don’t think the corporation was attaching enough importance to that.”

  • McDonald’s quality assurance manager testified that McDonald’s coffee, at the temperature at which it was poured into Styrofoam cups, was not fit for consumption because it would burn the mouth and throat.

  • McDonald’s admitted at trial that consumers were unaware of the extent of the risk of serious burns from spilled coffee served at McDonald’s then-required temperature.

  • McDonald’s admitted it did not warn customers of the nature and extent of this risk and could offer no explanation as to why it did not.

After the verdict, one of the jurors said over the course of the trial he came to realize the case was about “callous disregard for the safety of the people.” Another juror said “the facts were so overwhelmingly against the company.”

That’s because those jurors were able to hear all the facts — including those presented by McDonald’s — and see the extent of Mrs. Liebeck’s injuries.

But that's not the story that the public has heard. Tort reform advocates lied about the facts of the case and the fake story gained traction. It went viral. So viral that now this story is what is most often cited by jurors and others when explaining why they don't trust lawyers, why they don't like lawsuits, and why they think plaintiffs are just out for a quick buck. 

And it's all a lie.

 

 

If you want to read more, start here.

Can You Trust Your Company's HR Department?

A fellow blogger has a post out this week titled "Who Do You Report Harassment To If the Harasser Is the CEO?".  It is a thoughtful article and it makes the excellent point that HR for every company needs to bake into their policies a method by which an employee can internally report sexual harassment being committed by the CEO or owner of a company without risk of retaliation. I think that is an excellent goal to strive for and I hope that all HR departments set that as a goal.  There is only one problem with the premise of the article. 

The effort will almost certainly fail. 

Michael Corleone: "C'mon Frankie... my father did business with HR, he respected HR."

Frank Pentangeli: "Your father did business with HR, he respected HR... but he never trusted HR!"

 

 

HR is, in my opinion, possibly the most challenging role for any manager to do and do well. It is arguably designed to fail. The problem is obvious: HR serves two masters. On the one hand, HR is designed to serve as a helpful ombudsman to employees. To assist employees who are being mistreated. To conduct thorough investigations and correct inappropriate behavior against employees. On the other hand, HR is required to defend management against accusations of unlawful employment practices. HR is usually directly involved in the termination decisions that lead to EEOC filings. HR is then in charge of or at least heavily involved in drafting the company's defensive statement of position filings, arguing that the company is blameless. Thus, the very department that an employee is supposed to trust with his or her career and feel comfortable making a complaint to is the same department that will be spearheading the fight against the employee when it all goes south. 

What this means in most companies is that, no, you cannot trust HR to help you. While many HR officers have their hearts in the right place when they start working in the field, they can't help but know who is responsible for signing their paychecks. Hint: it's not the employee bringing a complaint against a member of management.  

So, should you bring complaints to HR? Yes, you should. In fact, in many cases you are legally required to do so or you risk waiving any claims you may have against the company for the discrimination or harassment you are reporting. Just don't assume that HR's only role is to help you. Because it isn't. While HR may be trying to assist you they are also assessing corporate risk, documenting your complaint in a way that will assist the company in defending against your complaint, and looking for ways to satisfy the demands of management. 

Here are a couple of quick tips: 

  1. Make all reports in writing. When push comes to shove down the road, HR is liable to either not "remember" you made a complaint or to remember it substantially differently than you do. Putting your report in writing is the only way to prove you made a complaint, when you made it, and to whom the complaint was made.

  2. You know that written report from number 1, above? KEEP A COPY. A written complaint does you know good if you send the only copy to HR. It might...you know...get lost.

  3. Consider going outside the organization to the EEOC. If your complaint involves EEO-based (age, sex, race, religion disability, color) discrimination or harassment then consider making a complaint to the EEOC sooner rather than later. There will be little question that a report to the EEOC is protected activity under the law. This gives you a somewhat higher level of protection from retaliation than if you merely report internally.

  4. Consult with an employment lawyer. If you are in a situation in which you feel you need to make a complaint against management then, make no mistake, you job IS at risk. Start looking for a qualified employment attorney who represents employees. Be warned, in many parts of the country there aren't that many who lawyers who specialize in representing employees. So start looking before you need one. And don't expect such a lawyer to visit with you for free. This is not a simple car accident case and you aren't looking for a PI lawyer who can take your case on a contingent fee basis. Employment law is very specialized and contingency fees are generally not available for consulting services. If you find a qualified lawyer to advise you, however, it is money well spent.

Bottom line: Yes, you should report harassment or discrimination internally to your company's HR department. But that doesn't mean you should blindly trust the HR department. Understand that they serve two masters and protect yourself accordingly.  

Tip Pool Violations and Other Forms of Wage Theft Common in the Restaurant Industry

Restaurant Workers Are Often Victims of Wage Theft

Restaurant Workers Are Often Victims of Wage Theft

The Wall Street Journal recently reported that wage lawsuits against restaurants have proliferated in troubling and damaging numbers:

“…The number of wage-violation lawsuits has been on the rise for more than a decade, driven by a successful worker-organization movement, increased attention by plaintiffs’ attorneys and complicated labor laws that leave some employers confused, according to legal analysts and industry leaders.

Nationwide, these lawsuits have doubled in the last 10 years in federal courts. In Texas, the number of overtime lawsuits and settlements continues to increase as well. The US Department of Labor recently reported that its wage and hour division found violations in 95 percent of its investigations of Austin-area restaurants between Oct. 1, 2015 and June 30, 2016. 

So why do the vast majority of restaurant employers continue to violate wage laws despite news reports of DOL investigations and lawsuits? 

Read more about overtime claims by restaurant workers.

Preparing for Your Initial Consultation with an Employment Lawyer

Yesterday we discussed some basic tips to help you search for an employment attorney for your case.  So now you have an initial consultation set up with a lawyer who has been recommended to you by a trusted source or who you have found from doing your own research. How do you make sure you make the most of this initial meeting?

In a word: Preparation.

Once you have a consultation with an employment lawyer scheduled, it is important that you prepare to make the most of the time you will have with the lawyer. Employment lawyers get dozens of contacts per week from potential clients and must be very selective about the cases they take. The initial consultation is your opportunity to make sure the attorney is well informed about the facts of your case. It is also your best chance to show the attorney that you are someone he or she wants to work with over the months and/or years that your matter may be pending on the firm’s docket.

Here are some important tips to keep in mind as you prepare for the meeting:

  • Take the meeting seriously and be prepared — Make sure you have good, clean copies (not originals) of any related documents with you when you arrive. Don’t expect the attorney to be your copy service and don’t leave your originals with the attorney.

  • Bring a fact chronology — Employment cases are complicated and fact intensive. A lawyer will not be able to tell you whether he can help you unless he knows most of the details of your case. The best way to do this is to bring a simple fact chronology that outlines the factual timeline of your case. A simple “Date — Fact” format will work fine in most cases. If at all possible it should be typed and not hand-written.

  • Be on time — Nothing says that you are not serious about your case like being late to your consultation. An attorney’s time literally is their money. Don’t waste it.

  • Pay the requested consultation fee on time or have it ready when you walk in the door — If the matter is not important enough for a consultation fee then don’t make the appointment to begin with. But if you do make the appointment, don’t put the lawyer in the position of trying to collect a fee from you at your first meeting. It’s not the way to get off to a good start.

  • Dress appropriately — How you dress communicates the level of seriousness you give the issue. You don't have to wear a suit. But showing up in a dirty T-shirt and flip-flops won't help convince the attorney that you are serious about your case. During the meeting the attorney is considering what a jury will think and whether they will take your testimony seriously. How you present yourself plays into this analysis.

  • Don’t bring unexpected guests — Attorney-client communications are privileged. This privilege can be lost if others sit in on the meeting. While someone else can certainly accompany you to the lawyer’s office, don’t expect them or ask for them to come into the meeting with you unless you cleared it in advance with the attorney. Dealing with this issue at the time of the meeting uses up valuable meeting time while the lawyer tries to assess whether they should be allowed into the meeting or not. Also, keep in mind that the lawyer wants to hear YOUR story and is less interested in your husband/wife, girlfriend/boyfriend or mother’s version of the story.

  • Don’t bring children — I love children. But they should not be brought to your attorney consultation. They are a distraction for you and the attorney and it can sometimes be difficult to discuss sensitive matters in front of them. Get a sitter or ask a friend or family member to watch them for you.

Following these steps should help you have a productive initial consultation and hopefully find a qualified attorney to handle your employment-related legal matter.

How to Hire An Employment Lawyer

So you need to hire an employment lawyer but you don’t know how to get started? This article is for you.

Hiring a lawyer to guide you through an employment-related dispute can be challenging. Unlike cases involving personal injury matters, there aren’t hundreds of employment lawyers running TV advertisements in an attempt to get you to “Call now!” Quite the opposite is true in fact.

Due to the complicated statutory nature of employment law practice, there are likely only a small handful of lawyers in even a relatively large city who are board certified to represent employees in employment-related disputes. The few who are qualified and have the years of experience you should be looking for will likely be extremely busy because there are so few of them. For this reason it is important that you do some research and get your own materials together before you start making calls.

To get you started, I've prepared a handy guide outlining some of the basic steps you need to take.

Step 1 - Do A Little Research Online. 

Before you pick up the phone and start making calls, pick up your mouse and start making clicks. Many good employment lawyers will have a website and/or a blog that will provide you with a lot of quality information about employment law issues. Take a look at what practice areas in which the lawyer claims he or she practices. You don’t want a jack-of-all-trades-master-of-none attorney for your case. You want someone who concentrates the majority of his/her practice on employment law issues. You could also search legal directory avvo.com to help you find local lawyers who represent employees. It isn’t a perfect system but it will give you a good list to start your research.

Step 2 - Check For Board Certification

Lawyers are not required to be Board Certified in employment law to practice it in Texas. Some states don’t even provide for board certifications. But in Texas, the State Bar of Texas does provide Board Certification to those lawyers who practice employment law for a sufficient period of time, provide recommendations from lawyers and judges who they have practiced with and who pass a lengthy examination process. You can learn more about Board Certification here.

Step 3 - Expect To Fill Out A Questionnaire And Pay A Fee For A Consultation

Many firms have developed questionnaires. These are not idle exercises. You must fill them out to help your lawyer understand your case so he can better help you. Plus, filling out these short (usually electronic) forms may save you money. Some attorneys use short electronic forms as an initial screening tool for the many potential client contacts they receive each day. Sometimes, the form indicates a simple question for which a quick answer can be provided. Other times, the type of case being described would be better handled by another lawyer who specializes in that specific niche — you can usually get that referral set up at no cost. Then, if the form indicates an issue on which a lawyer believes he or she can provide meaningful assistance, a full, in-person consultation can be scheduled.

Most attorneys charge a small consultation fee to review employment-related matters. Because employment law is very fact specific, an employment lawyer needs to know all the facts of your case before he or she can commit to representing you. This often takes time. If employment lawyers are not paid something for this, they cannot stay in business.

Step 4 - Prepare For Your Consultation

Once you have a consultation with an employment lawyer scheduled, it is important that you prepare to make the most of the time you will have with the lawyer. I have written an article discussing the initial consultation in more detail, including tips on what to bring and how to prepare for this important meeting.

Wage Theft Costs American Workers as Much as $50 Billion a Year

Wage theft is a nationwide epidemic that costs American workers as much as $50 billion a year, a new Economic Policy Institute report finds. In An Epidemic of Wage Theft Is Costing Workers Hundreds of Millions of Dollars a Year, EPI Vice President Ross Eisenbrey and EPI intern Brady Meixell examine incidences of wage theft—employers’ failure to pay workers money they are legally entitled to—across the country. The total amount of money recovered for the victims of wage theft who retained private lawyers or complained to federal or state agencies was at least $933 million in 2012, almost three times greater than all the money stolen in robberies that year. However, since most victims never report wage theft and never sue, the real cost of wage theft to workers is much greater, and could be closer to $50 billion a year.

“Wage theft affects far more people than more well-known crimes such as bank robberies, convenience store robberies, street and highway robberies, and gas station robberies combined, and can be absolutely devastating for workers living from paycheck to paycheck,” said Eisenbrey. “For low-wage workers, the wages lost from wage theft can total nearly 10 percent of their annual earnings.”

The authors also conducted a study of workers in low-wage industries in New York, Chicago, and Los Angeles and found that in any given week, two-thirds experienced at least one pay-related violation.  They estimate that the average loss per worker over the course of a year was $2,634, out of total earnings of $17,616. The total annual wage theft from front-line workers in low-wage industries in the three cities approached $3 billion. If these findings are generalizable to the rest of the U.S. low-wage workforce of 30 million, wage theft is costing workers more than $50 billion a year.

Read More:

Click here for a copy of the entire report.

Theoretically related posts:

Courts Make it More Difficult for Employees to Pursue Tip Theft by Employers

Wal-Mart Sued for Wage Theft

“Wage Theft”: The Trendy Phrase That May Not Mean What You Think It Means - From Daniel Schwartz's always excellent Connecticut Employment Law Blog

Wage Theft and Misclassification Report - Contains state by state grades.

 

Shell Oil and Related Company Pay Over $4 Million in Overtime Back Wages Following DOL Investigation

Shell Oil Co. and Motiva Enterprises LLC, which markets Shell gasoline and other products, have agreed to pay $4,470,764 in overtime back wages to 2,677 current and former chemical and refinery employees as a result of investigations by the U.S. Department of Labor that found violations of the Fair Labor Standards Act.

The department's Wage and Hour Division conducted investigations at eight Shell and Motiva facilities in Alabama, California, Louisiana, Texas and Washington, which found that the companies violated FLSA overtime provisions by not paying workers for the time spent at mandatory pre-shift meetings and failing to record the time spent at these meetings.

"Employers are legally required to pay workers for all hours worked," said U.S. Secretary of Labor Thomas E. Perez. "Whether in the international oil industry, as in this case, or a local family-run restaurant, the Labor Department is working to ensure that responsible employers do not experience a competitive disadvantage because they play by the rules."

The Wage and Hour Division's Houston District Office coordinated investigations with the Gulf Coast, New Orleans, San Francisco and Seattle District Offices to ensure nationwide compliance by Shell and Motiva. The findings revealed that those eight Shell Oil and Motiva refineries failed to pay workers for time spent attending mandatory pre-shift meetings. The companies required the workers to come to the meetings before the start of their 12-hour shift. Because the companies failed to consider time spent at mandatory pre-shift meetings as compensable, employees were not paid for all hours worked and did not receive all of the overtime pay of time and one-half their regular rate of pay for hours worked over 40 in a workweek. Additionally, the refineries did not keep accurate time records.

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour. Workers who are not employed in agriculture and not otherwise exempt from overtime compensation are entitled to time and one-half their regular rates of pay for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees' wages, hours and other conditions of employment, and it prohibits employers from retaliating against employees who exercise their rights under the law.

Source: US Department of Labor

Ninth Circuit Holds FedEx Drivers are Employees, Not Independent Contractors

Many will be surprised to learn that for years FedEx has treated its delivery drivers as independent contractors rather than as normal employees.

Why you ask?

The answer is simple: Money.

FedEx avoided health care costs, workers compensation insurance payments, paid sick leave and vacation, retirement costs and more. FedEx made drivers pay for their  FedEx-branded trucks, FedEx uniforms, and those little hand-held scanners they use. And don’t forget fuel, insurance, tires, oil changes, maintenance, even workers’ compensation coverage.

That all adds up to a lot of money. And that’s why these decisions out of the Ninth Circuit Court of Appeals are such a big deal. A three-judge panel of the appeals court ruled that FedEx drivers were employees “as a matter of law” under both California and Oregon law and “FedEx’s labeling of the drivers as ‘independent contractors’ in its operating agreement did not conclusively make them so.”

While I do not practice in California or Oregon, the tests at issue in these decisions do not appear all that different from the tests most other states that I am familiar with use to determine employee vs. independent contractor issues. And that fact could spell big trouble for FedEx and other employers attempting this strategy.

These decisions are part of a slowly-increasing level of scrutiny from the courts towards corporate efforts to save money by characterizing front-line workers as independent contractors and thus avoid normal employment costs.  In another recent decision, the National Labor Relations Board’s general counsel issued an opiniondeciding to treat McDonald’s Corp. as a joint employer of its franchisees’ fast-food workers for the purposes of NLRB violation claims.

FedEx has already indicated that it plans to appeal these decisions.