Friday, March 30, 2007

Restauruant workers who work overtime: are you entitled to 1.5 x $3.08 per overtime hour or 1.5 x the minumum wage?

Which is it? Hint: Restaurants frequently get the answer wrong. Here is the answer from the United States Department of Labor website:

Overtime: Overtime must be paid at a rate of at least one and one-half times the employee's regular rate of pay for each hour worked in excess of 40 hours per week. Tipped employees who receive $2.13 per hour in direct wages are also subject to overtime at one and one-half times the applicable minimum wage, not one and one-half times $2.13.

Note: Maryland's minimum wage for tipped employees is $3.08.

Thursday, March 29, 2007

Even Written Employment Contracts Can be At Will

Maryland is an "at will employment" state. With limited exception, an employer or an employee can terminate the relationship without notice for any reason. One familiar exception is that an employer cannot terminate an employee because of his or her protected status, i.e., because of his or her race, color, religion, gender, age, disability status, etc. Another familiar exception is if the parties have entered into a written agreement altering the at will relationship. The parties usually do this by agreeing in writing to an employment term (i.e., a year) and limiting the employer right to terminate to very specific reasons (often referred to in shorthand as limiting the right to terminate only "for cause").

But, what if the employees and the employer enter a written agreement without specifying an employment term. United States District Judge Blake ruled in this case that the absence of a term means that the relationship is "at will." How does this affect you? If you are an employee and are going through the trouble of negotiating an employment agreement make sure it has a term (and make sure you have an employment attorney review that agreement).

Two sidenotes:

  • I wrote here that under Maryland law a written at will employment agreement can contain a arbitration provision (waiving the employee's right to a jury trial).

  • Under Maryland law a written at will employment agreement can contain a non-compete provision (limiting the employee's ability to earn a living after the relationship ends).

Two more reasons to get expert advice when asked to sign an employment agreement.

Wednesday, March 28, 2007

General Assembly Extends Discrimination Cause of Action Statewide

I wrote here about a quirk in Maryland's anti-discrimination laws. At the time only individuals who lived in four Maryland counties (Prince George's, Montgomery, Howard, and Baltimore County), could file a lawsuit alleging a violation of a local civil rights ordinance.

On March 23, 2007, Maryland General Assembly extended the law to cover the entire State. If Governor O'Malley signs the law, which is expected, all Maryland residents will have the right to bring suit under a local anti-discrimination law. The bill, which takes effect on October 1, 2007, opens the door to state court for discrimination victims.

Thursday, March 15, 2007

Daniel Snyder Makes the Number 1 Employment Law Mistake: Jury Awards $44,880 to Nanny

What is the number one employment law mistake? Failing to pay overtime to non-exempt employees. Redskins owner Daniel Snyder learned the hard way after a Montgomery County jury awarded his former nanny $44,880 in unpaid overtime. The jury declined to award the nanny additional damages under the Maryland Wage Payment and Collection Law.

Snyder also learned that Maryland's overtime law contains no exception for in-home workers. Any person who pays another person to work can be an employer in Maryland.

Snyder could have easily avoided the lawsuit with no extra cost. How? You will have to email me to find out.

Wednesday, March 14, 2007

Rejecting Offer May Disqualify You From Receiving Maryland Unemployment Benefits

STS (a company) laid off Sharon Long from a seasonal position. She applied for unemployment benefits. A few weeks later STS offer Ms. Long a job at a higher rate of pay, but only until tax season ended. Ms. Long rejected the offer because she wanted to full time permanent work.

STS contested Ms. Long's unemployment claim. The company contended that she should be disqualified because she rejected STS's employment offer without good cause. Hence, STS presented the issue -- ultimately decided by the Court of Special Appeals -- of whether Ms. Long's decision to rejects STS's offer was made for good cause.

According to the Court:

We hold that under the circumstances of this case an ordinarily reasonable individual would not have turned down the offer of seasonal employment made by STS. Crucial to our decision in this regard is the fact that Long was offered
a “suitable job.” The job duties were exactly the same as the position she had last held before she became unemployed – and the pay was better.

Wednesday, March 07, 2007

Non-Competes Are Only Enforceable if Directed at a Legally Protected Interest

Not all employees can be covered by non-compete agreements. For example, if you are an administrator with little contact with customers or your employer's secrets, a court is unlikely to enforce any non-compete you signed. Non-compete agreements generally can only be enforced if directed at a legally protectable interest. Maryland Courts have found there to be a only a few (perhaps only two) legally protectable interests. Foremost among those interests are an employer's relationship with its customers and an employer's trade secrets.

No access to customers or secrets = no non-compete.

The Maryland Court of Appeals summarized the concept of what is a protectable interest forty years ago in Silver v. Goldberger. The concepts stands to this day. The Court stated:
There is a line of cases which holds that restraint is justified if a part of the compensated services of the former employee consisted in the creation of the good will of customers and clients which is likely to follow the person of the former employee. And there is another line of cases which holds that restraint is not justified if the harm caused by service to another consists merely in the fact that the former employee becomes a more efficient competitor just as the former employer did through having a competent and efficient employee.