Tag Archives: Ellen Leibovitch

ATTENTION EMPLOYERS: New Florida Minimum Wage Goes Into Effect October 1

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Effective October 1, 2021, Florida’s minimum wage will increase to $10.00 per hour (from the current $8.65 per hour).  This is the first in a series of annual increases designed to implement the voter-approved constitutional amendment to raise the state’s minimum wage to $15.00 per hour by September 30, 2026. 

For tipped employees, the minimum wage will increase to $6.98 per hour (from the current $5.63 per hour).  This rate will similarly increase up to $11.98 per hour by September 30, 2026.

Please make certain the persons or companies preparing payroll are aware of these changes as well as the resulting increases in the overtime rates.

If you have any questions, please feel free to reach out to Ellen. 

Ellen M. Leibovitch

Board Certified Labor & Employment Lawyer

ASSOULINE & BERLOWE, P.A.

2101 N.W. Corporate Blvd., Suite 410

Boca Raton, Florida 33431

Main: 561-361-6566
Direct: 561-948-2479

[Bio] [V-card] [Directions]

eml@assoulineberlowe.com

www.assoulineberlowe.com

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EMPLOYMENT LAW UPDATE: Application of the Religious Exemption in the Era of Employer-Mandated Vaccinations

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As most of you know, President Biden recently outlined a multi-prong strategy designed to curb the current wave of the COVID virus.  His plan includes the following points relevant to private employers:

•          All employers with 100 or more employees must implement vaccine mandates for their workforce or require workers who remain unvaccinated produce a negative test result on at least a weekly basis before coming to work.   OSHA is soon expected to issue an Emergency Temporary Standard (ETS) to implement this requirement and clarify which private employers are affected, i.e., how 100 employees should be counted.  More than likely, the 100-employee determination will apply to the employer’s total number of employees rather than the number of employees at each worksite.  The ETS should also require employers with 100+ employees to provide paid time off to those employees to get vaccinated or need time off to recover after vaccination. 

•          Mandatory vaccinations for all healthcare workers in healthcare facilities receiving Medicare or Medicaid reimbursement, including but not limited to hospitals, ambulatory surgical settings, and home health care agencies.

•          Employers with vaccine mandates must consider accommodating only those employees with medical or religious exemptions, and employees who do not qualify for a medical or religious exemption may be subject to termination.  Similarly, if an employer permits testing in lieu of vaccinations, an employee who refuses to test may also be terminated unless the employee requires an accommodation relating to testing.

To be clear, an employee requesting an exemption from the employer’s vaccination mandate due to a personal preference – rather than a medical or religious reason – is not protected from termination.

Religious exemptions or accommodations will surely increase in light of President Biden’s mandate, and since these requests are much more nuanced than medical exemptions, here is what employers should focus on in assessing these requests.

The threshold inquiry for any request for a religious accommodation is whether the employee has a “sincerely held religious belief, practice, or observance” that prevents the employee from receiving the COVID vaccine. Sincerely held religious beliefs include “moral or ethical beliefs as to what is right and wrong and held with the strength of traditional religious views.”

Equal Employment Opportunity Commission (EEOC) guidance states that employers should accept an employee’s claim of a sincerely held religious belief unless the employer has an objective basis to deny the exemption. The EEOC has identified four factors that may create doubt in an employer’s mind as to the sincerity of the employee’s religious belief, which include the following:

  1. Whether the employee has acted in a way that is inconsistent with the claimed belief;
  2. Whether the employee is seeking a benefit or an exception that is likely to be sought for non-religious reasons;
  3. Whether the timing of the request is questionable, e.g., does the request follows closely on the employee’s request for the same benefit for a different reason; and
  4. Whether the employer has other (secular) reasons to believe the employee is seeking the exemption.

Employers with an objective basis to question the employee’s stated religious belief should request additional information from the employee before deciding whether to grant the requested accommodation.

Even if the employer finds there is a valid religious reason behind the employee’s requested exemption, EEOC guidance (and other applicable precedent) further provides that an employer need not provide an accommodation if doing so would cause “undue hardship” to the employer.  An accommodation may cause undue hardship if it is costly, compromises workplace safety, decreases workplace efficiency, infringes on the rights of other employees, or requires other employees to do more than their share of potentially hazardous or burdensome work.  For example, an employer may be able to show that accommodations (such as regular testing, creating a separate area in which the employee can work, purchasing of personal protective equipment, etc.) are too costly or burdensome or that an unvaccinated employee can compromise the safety of its workforce and patrons.  The law does not require that an employee’s religious beliefs be prioritized over workplace safety.

In all accommodation cases, the employer must engage in an interactive dialogue with the employee requesting relief and evaluate each situation on a case-by-case basis.  Employers are encouraged to seek legal counsel before denying a request for accommodation and also consider implementing, reviewing or updating any policies and procedures for handling requests for both religious and medical accommodations.

If you have any questions about the implementation of vaccine mandates or other employment-related issues, please feel free to Ellen using the following contact information.

Ellen M. Leibovitch

Board Certified Labor & Employment Lawyer

ASSOULINE & BERLOWE, P.A.

2101 N.W. Corporate Blvd., Suite 410

Boca Raton, Florida 33431

Main: 561-361-6566
Direct: 561-948-2479

[Bio] [V-card] [Directions]

eml@assoulineberlowe.com

www.assoulineberlowe.com

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Does Non-Payment of Wages to an Exempt Employee Give Rise to an FLSA Claim?

The Fair Labor Standards Act (“FLSA”) is the federal law that establishes, among other things, that employees who are classified as “non-exempt” are entitled to be paid a minimum hourly wage and overtime pay when working more than 40 hours in any workweek.  A person who brings a successful FLSA lawsuit is also entitled to attorney’s fees and liquidated damages. Generally, and conversely, “exempt” employees are those who are exempt from the minimum wage and overtime provisions of the FLSA.  Exempt employees must be paid on a salary basis (and a minimum statutory required under the FLSA) and must perform certain duties.  Exempt employees include executives, administrators, and professionals.

The question that we are considering now is this: when an employer fails to pay one or more weeks of pay to an exempt employee whose exempt status is not in dispute, does that render the employee non-exempt and, therefore, entitle such employee file a lawsuit for violation of the FLSA and, in so doing, recover the lucrative damages and other relief thereunder?  The short answer is no. 

The Southern District of Florida considered this very issue in the case of Tadili v. Ferber, 12-80216-CIV, 2013 WL 12101132, at *2 (S.D. Fla. Nov. 22, 2013).  In that case, the plaintiff, an master dental technician (exempt as both a learned professional and a highly compensated employee), made the “convoluted argument” that since he did not receive his salary for five of the seven weeks he worked, he could not be considered an exempt employee.  The court noted, “An employee who is either a learned professional or a highly paid employee who is not paid for work performed may have a breach of contract claim for nonpayment of wages, but such employee will not have an FLSA claim.” The fact that the employee was not paid did not allow him to claim he was entitled to a minimum wage as a non-exempt employee.  Based on this reasoning, the court went on to grant the defendant’s motion for summary judgment.

Other cases holding that non-payment of wages to an otherwise exempt employee does not give rise to an FLSA claim include Nicholson v. World Bus. Network, Inc., 105 F.3d 1361 (11th Cir. 1997) (notingCongress’s intent in formulating the FLSA was to protect “poorer and powerless” workers, whereas the exemptions are carved out for those in higher employment positions who do not require such protections), and Orton v. Johnny’s Lunch Franchise, LLC, 668 F.3d 843 (6th Cir. 2012).  See also Donovan v. Agnew, 712 F.2d 1509 (1st Cir. 1983).

It is not unusual for an employer to run into cash flow issues and be unable to meet their payroll obligations.  When this occurs, employees may rush to hire legal counsel to sue, and savvy plaintiff’s attorneys know that the FLSA is the best and most lucrative basis for a collections claim.  Additionally, the FLSA allows employees to personally sue business owners and managers as well if they come within the definition of “employer” under the statute.  These lawsuits are often tough to defend (because liability is clear) and costly (because the statute provides for attorneys’ fees and liquidated damages).  However, if the employee bringing the lawsuit is clearly exempt – based on their salary and their duties – the foregoing line of cases should knock the wind out of plaintiff’s counsel’s proverbial sails.  No attorney can continue to litigate a claim in federal court unless the facts alleged are supported by the evidence and are warranted under existing law or a non-frivolous argument to modify the law.   

As always, when faced with these issues or served with an FLSA lawsuit – or even a demand letter – the best practice is to always consult legal counsel.  Whatever you do, do not ignore the threat of an FLSA lawsuit or actual claim.   

Ellen M. Leibovitch

Board Certified Labor & Employment Lawyer

ASSOULINE & BERLOWE, P.A.

2101 N.W. Corporate Blvd., Suite 410

Boca Raton, Florida 33431

Main: 561-361-6566
Direct: 561-948-2479

[Bio] [V-card] [Directions]

eml@assoulineberlowe.com

www.assoulineberlowe.com

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Can Employers Require Employees to Get the COVID-19 Vaccine?

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Happy New Year! 

Moving on from 2020 does not mean we have moved on from the scourge that is COVID-19.  However, the COVID vaccine is finally here! Though distribution has been slow, employers are planning ahead and wondering if they can require employees to get a vaccine as a condition to returning to work.  The short answer is yes, but there are some important factors to take into consideration to avoid potential risks, such as compliance with the Americans with Disabilities Act (ADA), Title VII of the Civil Rights Act of 1964 (Title VII), and other state and federal employment laws.

According to newly published EEOC guidance, employers, in general, can require employees to be vaccinated against COVID-19 and have determined that administration of a vaccine is not a medical examination under the ADA. “If a vaccine is administered to an employee by an employer for protection against contracting COVID-19, the employer is not seeking information about an individual’s impairments or current health status and, therefore, it is not a medical examination.” However, employers should be careful with any pre-vaccination questions as those could be subject to ADA laws. Employers need to make sure that these questions are job-related and consistent with business necessity.

Of course, there are always exceptions to the general rule.  Employees who have medical concerns related to a disability or sincerely held religious beliefs that preclude them from being vaccinated may be exempted from the vaccination requirement. In these scenarios, a reasonable accommodation that does not pose an undue hardship to the employer’s business may be required, such as allowing the employee to work from home, requiring the employee wear protective equipment at all times, or providing a separate space for the employee to work.

Where an accommodation is not possible or cannot substantially reduce the risk of infection to others, the employer must be able to demonstrate that the unvaccinated employee poses a “direct threat” to the safety and health of other individuals at the workplace. The following factors should be evaluated in determining if a direct threat at the workplace exists:

  • the duration of the risk
  • the nature and severity of the potential harm
  • the likelihood that the potential harm will occur
  • the imminence of the potential harm 

If there are no reasonable accommodations available and the employer finds that the employee does pose a direct threat to others, the employee may be prohibited from physically entering the workplace, but this does not mean the employer can terminate the worker without liability. Employers will need to determine if any other rights apply under other federal, state or local laws.

Finally, employers are not shielded from liability if an employee suffers adverse effects from a mandated vaccine administered by the employer or a third party with whom the employer has contracted. Therefore, the best option for employers is to encourage employees to take the vaccine voluntarily rather than mandating it. Employers can choose to give incentives to those employees that decide to get the vaccine to promote voluntary compliance.

Always best to contact legal counsel if you have any further questions.

Ellen M. Leibovitch

Board Certified Labor & Employment Lawyer

ASSOULINE & BERLOWE, P.A.

2101 N.W. Corporate Blvd., Suite 410

Boca Raton, Florida 33431

Main: 561-361-6566
Direct: 561-948-2479

[Bio] [V-card] [Directions]

eml@assoulineberlowe.com

www.assoulineberlowe.com

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EMPLOYERS: Are You Exempt from Paid Sick Leave for COVID?

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Among other things, the Families First Coronavirus Relief Act (FFCRA) provides paid leave to employees to care for a child and paid sick leave.  Though the FFCRA generally applies to employers with less than 500 employees, employers with less than 50 employees can be exempt if compliance with the FFCRA would jeopardize “the viability of the employer’s business as a going concern.” Upon enactment, Congress did not clarify the mechanism for claiming an exemption, but the Department of Labor (DOL) recently issued some guidance.

A small business (with fewer than 50 employees) may be exempt from certain paid sick leave and expanded family and medical leave requirements if: (a) leave is requested because the employee’s child’s school or place of care is closed, or child care provider is unavailable, due to COVID-19 related reasons; and (b) providing that employee such leave would jeopardize the viability of the employer’s business as a going concern.  As to (b), an authorized officer of the business must determine that at least one of the following three conditions is satisfied:

  1. the requested leave would result in the small business’s expenses and financial obligations to exceed available business revenues and cause the small business to cease operating at minimal capacity; or
  2. the absence of the employee or employees requesting leave would entail a substantial risk to the financial health or operational capabilities of the business because of their specialized skills, knowledge of the business or responsibilities; or
  3. there are not sufficient workers who are able, willing and qualified, and who will be available at the time and place needed, to perform the labor or services provided by the employee or employees requesting leave, and those labor or services are needed for the small business to operate at minimal capacity.

The exemption applies only to leave requests under the FFCRA due to school closures and child care unavailability and does not exempt small businesses from providing sick leave for any of the other types of permissible requests under the FFCRA. 

The DOL does not explain how small businesses go about claiming the exemption and specifically advises employers not to send any materials to the DOL.  So what is an employer to do?  We recommend having an authorized officer of the employer sign a statement verifying that one or more of the three qualifying reasons apply and attach supporting materials if available.  The employer must maintain this record for at least four (4) years in case of a lawsuit, DOL audit or other challenge. Remember that this exemption only applies to employers with less than 50 employees and is otherwise inapplicable to employers with 51 to 499 employees.

Ellen M. Leibovitch

Board Certified Labor & Employment Lawyer

ASSOULINE & BERLOWE, P.A.

2300 Glades Road

East Tower – Suite 135

Boca Raton, Florida 33431

Main: 561-361-6566
Direct: 561-948-2479

[Bio] [V-card] [Directions]

eml@assoulineberlowe.com

www.assoulineberlowe.com

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New Employment Law Developments

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For all the media time devoted to President Trump, many of you may have missed some actual law-making going on behind the scenes.  Let me take a moment to update you as to three developments which should be of interest to employers:

 1-9 Audits on the Rise

Immigration and Customs Enforcement (ICE) has announced plans to increase I-9 audits this summer and focus on punishing employers who hire illegal workers and deporting of workers in the country illegally.  Make no mistake – the punishment to be imposed by ICE can include civil penalties and/or criminal charges.

 Accordingly, now is the time to make sure your I-9’s are in order and, if they need to be updated because the form of identification on file has expired or will be expiring soon, update them now.  Not all employers are enrolled in E-Verify, but many in the know believe the aim of ICE’s aggressive tactics is to increase E-Verify enrollment.

 While the audits do not include independent contractors, classifying workers as contractors when they should properly be classified as employees may expose employers to headaches beyond ICE: namely the Department of Labor and the Internal Revenue Service.

 New Rules for Tips and Tip Pools

As part of the 2018 tax bill, Congress amended the Fair Labor Standards Act (FLSA) in regards to tip pools and tip ownership.  First, under the new rules, employers are prohibited from keeping tips received by their employees, regardless whether the employer takes a tip credit. Second, the new rules state that employers who pay the full minimum wage (currently $8.25/hour in Florida) can allow employees who are not customarily and regularly tipped – like cooks and dishwashers – to participate in tip pools.  Note that tip pools must still exclude supervisors, managers and owners.

 Many employers do not pay tipped employees the minimum wage and instead take a “tip credit,” recognizing that the employee’s tips will bring the hourly rate up to and over the minimum wage.  For employers who wish to include back of the house workers in the tip pool, paying the minimum wage rather than the tip credit is a way to accomplish this goal.

 Arbitration Can Eliminate Class/Collective Actions

In the case of Epic Systems Corp. v. Lewis , the U.S. Supreme Court upheld an arbitration clause in an employment agreement which precluded the employee from bringing a class action against the employer.  The 5-4 decision authored by Justice Gorsuch makes clear that employer-favored arbitration agreements can be used to eliminate the risk of costly class and collective actions.

 Opponents of such agreements argued that arbitration could not trump employees’ rights to join together to seek common relief.  Based on the holding in Epic Systems, arbitration agreements can be used to eliminate an employee’s right to participate in a class or collective action and require arbitration of the employee’s individual claims only.

 Those of you who require your employees submit to arbitration to resolve any employment-related dispute should have counsel review the arbitration agreement to ensure that it precludes the employee from participating in a class or collective action.  Those of you who do not have arbitration agreements with your employees – either as a stand-alone agreement or as a clause in an employment contract – may want to consider putting this type of agreement in place.

 As always, if you have any questions about the foregoing or other employment-related matters, please feel free to contact me.  Happy Memorial Day to all!

Board Certified Labor and Employment Partner Ellen Leibovitch

ASSOULINE & BERLOWE, P.A.

1801 N. Military Trail, Suite 160

Boca Raton, Florida 33431

Main: (561) 361-6566

Fax: (561) 361-6466

Email: EML@assoulineberlowe.com

http://www.assoulineberlowe.com/

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Recognizing Michelle Suskauer as SPBC FAWL Woman Lawyer of the Year

On March 29, 2018, the Past Presidents of the South Palm Beach County chapter of the Florida Association for Women Lawyers (SPBC FAWL) presented their annual “Woman Lawyer of the Year” award to Michelle Suskauer.  Among Michelle’s many achievements, she is most notably the President-Elect of The Florida Bar, a partner with the law firm Dimond Kaplan & Rothstein, P.A., a highly-respected criminal defense attorney and an outspoken advocate for women.

Ellen Leibovitch, head of Assouline & Berlowe, PA’s labor and employment department and Board Certified Labor & Employment attorney, is a Past President of SPBC FAWL and chair of this event.  The event was held at the beautiful Woodfield Country Club in Boca Raton, Florida, and was sponsored by over 30 organizations, including Assouline & Berlowe.

Previous winners of the Woman Lawyer of the Year award include Barbara Pariente, Justice of the Florida Supreme Court, and Samantha Schosberg Feuer, Circuit Court Judge for the 15th Judicial Circuit.

For any questions about SPBC or FAWL, please contact Board Certified Labor and Employment Partner Ellen Leibovitch.

ASSOULINE & BERLOWE, P.A.

1801 N. Military Trail, Suite 160

Boca Raton, Florida 33431

Main: (561) 361-6566

Fax: (561) 361-6466

Email: EML@assoulineberlowe.com

http://www.assoulineberlowe.com/

 

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Website ADA Compliance – The Next Wave of Litigation?

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For over 25 years, the Americans with Disabilities Act (ADA) has required business owners offering public accommodations reassess accessibility to the disabled.  Usually, being named as a defendant in a federal lawsuit challenging parking spaces, restroom sizes and furnishings, counter heights and other similar structural barriers forces business owners to comply with the ADA.  The fact is that most businesses are susceptible to these lawsuits given the rise of the so-called “drive by” phenomenon, where the same plaintiff, with the assistance of the same attorney, files multiple lawsuits against all businesses in the same shopping center, same geographic care or same industry.

Enter the 21st century, and we are seeing a new frontier for legal challenges under the ADA: websites.  Many business owners fail to realize that specific accessibility standards apply to websites as well, which is why attorneys representing sight and hearing-impaired and other physically disabled users are suing businesses whose websites fail to comply with the current web content accessibility guidelines (WCAG).  Consequently, businesses whose websites may not be accessible to the disabled would be smart to consider remediation before getting sued.

According to Jeremy Horelick, Vice President of ADA Site Compliance:

The cost of proper remediation can range from tens of thousands of dollars to the high-six-figures. Big companies like Target, which spent nearly $10 million in restitution and legal fees in a landmark case brought by the National Federation of the Blind, can bear that financial hit. But small and mid-market businesses often cannot. For them, getting ahead of the compliance curve is a must, especially now that the DOJ has withdrawn its long-awaited regulations on the matter. The lack of clarity means a near-certain uptick in the pace of forthcoming cases.

One recent decision in the Southern District of Florida is Gil v. Winn-Dixie Stores, Inc. In that case, the plaintiff argued that defendant’s website was inaccessible to the visually impaired.  Title  III of the ADA prohibits the owner of a place of public accommodation from discriminating “on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages, or accommodations of any place of public accommodation . . . .” 42 U.S.C. § 12182(a).  The court stated that when a website is heavily integrated with physical store locations, the website is a service of a public accommodation and covered by the ADA.  As a result, the court found that the defendant’s website was not accessible to visually impaired individuals who must use screen readers to view the website and granted an injunction to ensure the website was in compliance with the ADA.

Federal lawsuits are costly and time-consuming, which is why smart business owners should act proactively: remediation before litigation.  Horelick suggests hiring a qualified third-party auditor to scan your site and determine the scope of work to be done as this will establish an objective baseline.  Also, avoid free online diagnostic tools, which only catch 20-30% of known failures at best. Businesses that rely solely on free tools may get a false sense of compliance with the WCAG.

For any questions about the ADA and this new frontier of ADA compliance, please contact Board Certified Labor and Employment Partner Ellen Leibovitch.

ASSOULINE & BERLOWE, P.A.

1801 N. Military Trail, Suite 160

Boca Raton, Florida 33431

Main: (561) 361-6566

Fax: (561) 361-6466

Email: EML@assoulineberlowe.com

http://www.assoulineberlowe.com/

Intellectual Property, Labor & Employment Law, International Dispute Resolution, Bankruptcy, Commercial Litigation, Real Estate, and Corporate Law

Miami • Ft. Lauderdale • Boca Raton

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Employment Law 101: Critical Issues to Know

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Whether you are an employer or an employee, you form a part of the workforce. Therefore, you should understand some laws and rules applicable to different employment situations.

First, as an employee without an employment contract, you should know that you can be fired for any reason at all, so long as the reason is not discriminatory or retaliatory. Discrimination does not mean you were simply treated unfairly, or differently than others. A discrimination claim arises if you were treated differently because of your age, race, sex, disability, national origin, or other protected class.  In short, you cannot be fired simply because you are older, African-American, a woman, or disabled. However, you can be fired if your boss believes you are performing poorly, even if you disagree.

You also cannot be fired for retaliation, which occurs when you suffer an adverse employment action – such as termination, demotion, suspension, etc. – as a result of complaining about a violation of the law. Therefore, if you complain about something that is not a violation of the law and you are fired, you are not protected. If you complain about your boss being rude, you can be fired; but if you complain your boss is stealing money, that could rise to retaliation. Unless you have been discriminated or retaliated against, you do not have a claim for “wrongful termination” and, in fact, there is really no such thing as wrongful termination because Florida is an at-will state. You can quit or be fired for any reason or no reason at all.

Furthermore, if you are fired, you do not have to be given a letter of termination, you do not have to be given an explanation, and you are not entitled to severance. You may be entitled to unemployment compensation unless you have committed “misconduct connected with your work.” This is a fairly high standard; but some actions that are considered misconduct include excessive absenteeism, insubordination, not following employer’s rules, etc.

Also, if you quit your job because you are working for a jerk who treats you badly, you cannot claim you were harassed and think you will prevail in a lawsuit. Harassment has to be based on you being a protected status (age, race, gender, national origin), so being berated or treated badly is not harassment; and if you quit – unless you are forced to do so because your employer has made your life miserable – you cannot collect unemployment.

Now, let’s turn to employers. Employers who are covered by the Fair Labor Standards Act must comply with the overtime, minimum wage and child labor laws. Non-exempt employees must be paid overtime and must keep track of all hours worked per week. But what does this mean – exempt or non-exempt from what? An exempt employee is not entitled to be paid overtime, such as a partner at a law firm. Conversely, a non-exempt employee, like a paralegal, must be paid for working over 40 hours in a work week.

So how do you know if your employee is exempt? Well, this will depend on what the employee does, not their title. For example, if you employ an “office manager” who does not actually manage people or have the ability to exercise independent judgement and discretion, that person may not be exempt. Also, keep in mind that paying an employee a salary does not mean that the employee is non-exempt or not entitled to overtime. Non-exempt employees must be paid overtime regardless of the fact that they are paid a salary or not.

Many employers believe that their business does not have enough employees to be covered by the FLSA, but this could not be further from the truth. The FLSA does not contain a “minimum number of employees” requirement. However, the act does require gross revenues of $500,000 and the element of interstate commerce. Therefore, except for very small businesses and those specifically exempted from the FLSA, your business may well be subject to the FLSA’s requirements.

Many private employers also believe that they can ask an employee to waive their right to be paid overtime and that the employee can agree to do so. This is wrong. The right to overtime cannot be waived under any circumstances. A non-exempt employee MUST be paid for all hours worked and, if that employee works over 40 hours in a work week, she must be paid overtime. Remember that the hours worked are measured per week; so if your payroll covers two weeks and the employee works 50 hours in week one and 30 hours in week two, that employee must be paid for 10 hours of overtime for week one.

Finally, a word about independent contractors. Whether you have been hired as an independent contractor or whether you have hired someone to work with you as an independent contractor, you must be certain that a contractor relationship – not an employment relationship – has been established. The key to the inquiry is control. Actually, the IRS has a list of 20 factors which determine if a person should be classified as an independent contractor or an employee, but the level of control is the overriding concern. The reason why it is important to distinguish one from another is that the laws apply differently to independent contractors than to employees.

For example, for independent contractors, no taxes are deducted, the FLSA overtime rules do not apply, discrimination and harassment laws generally are not applicable, and there is no unemployment compensation. If you are hired for a job as an independent contractor or if you hire someone to work for you as one, be certain that a true independent contractor relationship is in place. If you get it wrong, there can be significant tax and wage implications. Make sure you have an independent contractor agreement in place to define duties and pay and define the relationship. Though this may not control, it will help. And, of course, if you have any questions or find yourself in need of advice regarding these topics, please contact a labor and employment attorney.

Please feel free to contact me if you have any questions or comments.

Ellen is a Florida Board Certified Labor and Employment Attorney with Assouline & Berlowe, P.A.

ASSOULINE & BERLOWE, P.A.

1801 N. Military Trail, Suite 160

Boca Raton, Florida 33431

Main: (561) 361-6566

Fax: (561) 361-6466

Email: EML@assoulineberlowe.com

http://www.assoulineberlowe.com/

Intellectual Property, Labor & Employment Law, International Dispute Resolution, Bankruptcy, Commercial Litigation, Real Estate, and Corporate Law

Miami • Ft. Lauderdale • Boca Raton

 

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EMPLOYERS: New Tax Law Makes CONFIDENTIAL Sexual Harassment Settlements NOT DEDUCTIBLE

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The new tax law disallows tax-paying entities from taking a deduction for sexual harassment settlements that are subject to non-disclosure or confidentiality agreements.  In other words, if a company wants a confidential settlement, the company has to pay taxes on the settlement, fines and other expenses incurred.  Conversely, the only way such settlements can be written off and not taxed is if they are not confidential and, therefore, discoverable.

The relevant portion of the new law reads as follows:

No deduction shall be allowed under this chapter for – (1) any settlement or payment related to sexual harassment or sexual abuse if such settlement or payment is subject to a nondisclosure agreement, or (2) attorney’s fees related to such settlement or payment.

Under the law as written, no taxpayer (neither the complaining party nor the respondent) can write off the settlement reached in a sexual harassment case if the settlement is confidential.  Previously, the party sued (employer) could write off the settlement amount regardless of the confidential nature of same.  Now, the party paying the settlement cannot deduct the settlement if confidentiality is required.

The idea behind the change was that companies should not be able to keep a settlement confidential (perpetrating a culture where claims of sexual harassment are quietly settled and swept under the rug) and benefit from a tax deduction.  Still, the reality is that most companies will forego the deduction to ensure confidentiality.  Employers are strongly encouraged to seek the advice of employment law and tax counsel to properly document such settlements.

As an aside, note that settlements of claims against members of Congress will not be subject to this provision since the US government is not a taxpayer.

Please feel free to contact me if you have any questions or comments.  Here’s wishing everyone a happy, healthy and prosperous 2018!

Ellen is a Florida Board Certified Labor and Employment Attorney with Assouline & Berlowe, P.A.

ASSOULINE & BERLOWE, P.A.

1801 N. Military Trail, Suite 160

Boca Raton, Florida 33431

Main: (561) 361-6566

Fax: (561) 361-6466

Email: EML@assoulineberlowe.com

http://www.assoulineberlowe.com/

Intellectual Property, Labor & Employment Law, International Dispute Resolution, Bankruptcy, Commercial Litigation, Real Estate, and Corporate Law

Miami • Ft. Lauderdale • Boca Raton

 

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