Articles Posted in Overtime Pay and Unpaid Wages

It is important for employers to understand their obligations under the federal and state labor laws before any action is commenced. Proactive steps in this area can be significant. Our Award Winning NY Employment Lawyer routinely counsels businesses on best practices and compliance issues. A sample New York State Department of Labor notice is included below to show what can happen if a business does not comply with the required legal provisions.

Dear Business Owner:

This letter is in regards to your business, ABC Corp. The New York State Department of Labor (NYSDOL) has completed an investigation in order to determine your compliance with the NYS Labor Law from September 2012 through August 2016.

New York State Department of Labor Misclassification of Workers Blog Series

That was the issue in the recent New York Third Department Appellate Division decision In the Matter of TMR Security Consultants Inc., [Commissioner of Labor] Decided December 29, 2016. This is another key case in a new series of decisions beneficial for companies. We have discussed prior DOL decisions in our blog. This is an area that is evolving and the cases are very fact specific. An adverse determination can have significant consequences including a future claim for unpaid overtime pay. If you have any concerns or questions, contact our Award Winning New York Employment Lawyer to understand your rights and options.

On June 9, 2015, the Unemployment Insurance Appeal Board found that TMR Security Consultants had misclassified its security officers as independent contractors instead of employees. As a result, TMR was responsible for not only making unemployment insurance contributions for the claimant but also for all similarly situated workers; not only can that be expensive, it can also raise other collateral legal issues. TMR appealed that decision to the Appellate Division, which reversed and determined that the workers were independent contractors for multiple reasons (e.g., the Company did not direct or control the workers, the workers could work for competitors, the workers were licensed, etc.). Selections from the Court’s decision are included below:

Our New York Misclassification Attorney discusses a recent court decision that addresses that question.

A group of FedEx Ground drivers (“Plaintiffs”) alleged that they were misclassified as independent contractors instead of employees in Padovano v. FedEx Ground Package System, Inc. (the “Company”). The Plaintiffs argued that appellate courts throughout the country previously ruled that the drivers at issue have been found to be employees. Nonetheless, the Company filed a Motion to Dismiss the claims based, in part, on the fact that the Company and the Plantiffs signed independent contractor agreements. The Court denied the Company’s motion last week.

The Workers’ Claims

Our New York Worker Misclassification Attorney Discusses the Recent Yoga Vida Case

Yoga Vida is a yoga studio in New York City and it used two different types of instructors – staff instructors who were treated as employees and non-staff instructors who were treated as independents. As you can guess, the crux of the legal battle in this case was whether the non-staff instructors were correctly classified as contractors or should have been treated as employees. The Company was fortunate enough to have the resources to fight the long battle because the Unemployment Insurance Appeal Board and the Appellate Division both found that the non-staff instructors were misclassified. As a result, the Company was responsible for certain state payroll contributions and could have been responsible for providing employee benefits. The Company filed an appeal to the Court of Appeals.

On October 25, 2016, the Court of Appeals reversed the prior determinations and found that the non-staff instructors were actually independent contractors because, in part, the evidence did not find that the Company exercised control over the results produced and the means used to achieve the results. In short, the Court found that the Company did not exercise sufficient control and direction over the workers. Some of the key factors that the Court found compelling:

In these difficult economic times, it is not uncommon for workers find themselves taken advantage of by unsavory and corrupt business practices. Workers who are paid in cash, off-the-books, and whose work schedules vary from day-to-day, week-to-week, or month-to-month are particularly vulnerable to exploitation from their employers. Our Award Winning New York Employment Attorney discusses New York State’s latest efforts to combat worker exploitation.