Perspectives

Magic Burgers, a Florida burger restaurant, employed Plaintiff, Ashley Merard, as a cashier in the restaurant’s front counter and drive-through.  Merard had previously been involved in a car accident leaving her with a tracheostomy tube, which was visible on Merard’s neck.  About one month after beginning employment, Merard was fired by her supervisor, Sonia Rivera.  When Merard asked Rivera why her employment was being terminated, Rivera pointed at Merard’s tracheostomy tube and said, “because of that.”  Merard filed a charge of discrimination with the EEOC alleging discrimination in violation of the Americans with Disabilities Act (“ADA”) and the Florida Civil Rights Act.  The EEOC issued a right-to-sue letter, and subsequently Merard filed suit.

During the jury trial, Rivera testified that after Merard’s termination, the Regional District Manager, Jim Burris, came to the restaurant to ensure that the “nasty girl with . . . the tube in her throat” had been terminated.   The jury awarded Merard $15,000 in compensatory damages, $30,000 in emotional pain and suffering damages, and tried to award $2 million in punitive damages.  Luckily for Magic Burgers, the ADA places a statutory $300,000 cap on punitive damages.  In total, the district court entered judgment awarding Plaintiff $345,519.60.

Plaintiffs asserting federal employment discrimination claims can recover punitive damages when “the employer has engaged in intentional discrimination and has done so ‘with malice or with reckless indifference to the federally protected rights of an aggrieved individual.’” Kolstad v. Am. Dental Ass’n, 527 U.S. 526, 529-30 (1999) (citing 42 U.S.C. § 1981a(b)(1)).  Employers can attempt to avoid an award of punitive damages by asserting a good-faith defense, as Magic Burgers attempted to do here.  Employers using this defense argue that a management-level employee’s decision is “contrary to the employer’s good faith efforts to comply” with employment laws.  Id. at 545-46.

Magic Burgers argued that its establishment of an anti-discrimination policy was sufficient to mount a good-faith defense to Burris’ actions.  However, the simple existence of an anti-discrimination policy is not sufficient to establish the good-faith defense.  Testimony at trial revealed that the company had failed to communicate and train their managers on the policy and that Rivera failed to report Burris’ discriminatory actions for fear she would be deemed insubordinate.  These facts rendered Magic Burgers’ anti-discrimination policy ineffective, thus the restaurant was not entitled to the good-faith defense.

Employers must remember that it is not enough for a company to just implement an anti-discrimination policy.  Companies must also ensure that all employees receive a copy of the policy and are given training, ideally on an annual basis.  Any state laws governing employee training must also be considered.  Employee training should, at a minimum, define the different forms of discrimination, discuss how employees can prevent workplace discrimination, and provide a variety of methods for reporting discrimination.  Managers at all levels should receive additional anti-discrimination training that more fully explains their duties to promote a discrimination-free workplace, understand the relevant anti-discrimination laws, how to recognize requests for reasonable accommodations, how to respond to discrimination complaints, and how to avoid retaliation.   Had the leaders from Magic Burgers followed their own, presumedly well-intentioned policies, that $345K would still be tucked away in their magic hat.

Does your anti-discrimination policy need an update? Or maybe you need help creating a training process for your employees to avoid making the same mistakes as Magic Burger. No matter your need, the Employment Law team at Wagner, Falconer & Judd is here to help!

One of the best and most important things you can do for your future is to have a will. A will is a legal document that allows you to state how you would like your assets to be distributed after your death. If you pass without a will, the state laws will dictate the distribution of those assets.

You should have a will if:

Most people don’t realize how simple it can be to set up a will. Let the attorneys at Wagner, Falconer, and Judd make it even easier for you! We have several estate planning options to choose from, depending on your situation. Speak with one of our consulting attorneys today to see what plan would be right for you!

Legal issues are complex. Working with an attorney doesn’t need to be. When you bring your case to Wagner, Falconer & Judd, our dedicated on-boarding staff will explain your payment options to you. Based on the type of case you have, they will walk you through which payment option is right for you.

Retainer Fee: A retainer is a sum of money paid by the client to the attorney up front before the attorney will begin working on the client’s case. This money is placed in an account that the attorney will bill their time against as the case progresses. This is all explained in a written retainer agreement, which your attorney will explain to you before you sign. This will state how you will be charged and what will happen if your retainer fee is reduced to zero before the case is completed.

Flat Fee: A flat fee is a single amount paid by the client in return for a single legal service performed by the attorney. This is usually used for legal work that will not require ongoing representation. (One time events such as filing an LLC, or handling a real-estate agreement.)

Contingency Fee: A contingency fee is when a percentage of the “winnings” either awarded to the client by the court after a trial has occurred, and or paid to the client from the defendant via a settlement agreement. The attorney will not get paid unless the client wins the case. Typically, contingency fees are charged for a personal injury case, where a client is suing someone for a wrong against a client. Contingency fees are not allowed in certain kinds of proceedings, such as criminal defense or divorce representation. Attorney fees can not be contingent upon any specific outcomes in those types of proceedings.

If you have any questions about how your specific case is being billed, or to discuss your best options, reach out to our consulting team. They are always here to help.

On April 29, 2022, to thank Minnesotans who kept vital businesses running during the COVID-19 pandemic, Governor Tim Walz signed the Frontline Worker Payments law.  The law allows eligible workers in one of 15 different frontline sectors to apply to receive an estimated $750.00 payment.

These sectors include:

• long-term care and home care;
• health care;
• emergency responders;
• public health, social service, and regulatory service;
• courts and corrections;
• childcare;
• schools, including charter schools, state schools and higher education;
• food service, including production, processing, preparation, sale, and delivery;
• retail, including sales, fulfillment, distribution, and delivery;
• temporary shelters and hotels;
• building services, including maintenance, janitorial, and security;
• public transit;
• ground and air transportation services;
• manufacturing; and
• vocational rehabilitation.

Employers in one of the above-delineated frontline sectors must provide all current, potentially eligible workers with notice of the Frontline Worker Pay law by June 23, 2022.  The Minnesota Department of Labor has created a sample employer notice which can be found here.  The notice must be posted at each worksite where workers work and in a conspicuous place that can be easily accessed by all workers, such as a break room or in a location where other work-related notices are posted.  Notices can also be distributed in paper or electronic copies.

The Department of Labor has also created a helpful FAQ document which can be found here.

Getting injured on the job can be particularly stressful. Worker’s compensation provides medical expenses, lost wages, and rehabilitation costs to employees who are injured or become ill during the course of their job.  Let the experienced attorneys simplify an otherwise complex situation. So you can focus on getting well, and moving forward.

What should you do if you are injured at work?

First- you should report the injury to your employer as soon as your injury occurs. Make sure the supervisor/HR knows as well. It’s helpful to shoot an email to your supervisor, manager, HR department the same day of the injury. The email should document any and all injury/symptoms from the incident. Even if it feels unrelated, such as your neck hurting after slipping and falling on your hip, let them know.

Your health and safety should always be top priority. We encourage all injured persons to be seen by a doctor who can help with treatment and recovery. Remember, the employer and their insurer may be liable for all treatment of a work injury, depending on your individual state’s laws.

You should start documenting work time missed and medical costs incurred, including medical bills, prescription costs, mileage and time off of work. Document any time missed for the injury, appointments, and reduced time if you are put on certain restrictions. Any wage loss incurred should also be documented.

If you have been injured on the job and unsure if you have covered all your bases, our team of Personal Injury attorneys are standing by to help simplify the process for you, so you can focus on healing.

The State of Virginia recently passed a law which helps ensure that construction subcontractors get paid for their work. Historically, “paid-if-paid” clauses in construction contracts have been enforceable in Virginia if the contract language is unambiguous.[1] A paid-if-paid clause creates a condition precedent where the prime contractor is only required to pay its subcontractors if the project’s owner first pays the prime contractor. Therefore, if a construction job falls through and/or the owner otherwise stops paying, paid-if-paid clauses free the prime contractor from having to pay its subcontractors. Virginia’s new law shifts the risk of getting paid for completed work from subcontractors back to the prime contractor.

In April 2022, Virginia passed into law SB550, which prohibits the use of paid-if-paid clauses in any public or private construction contract; the law goes into effect on January 1, 2023. SB550 requires a prime contractor to pay its subcontractors, regardless of whether the project owner pays the prime contractor. Under SB550, prime contractors are obligated to pay a subcontractor within sixty days from receiving an invoice from the subcontractor, or seven days after receiving payment from the owner, whichever is earlier.

Virginia’s new law is unique because paid-if-paid clauses are enforceable in most jurisdictions. Virginia will be the seventh state to make paid-if-paid clause unenforceable.[2] Nine other states only prohibit paid-if-paid clauses under certain conditions.[3] In most of these jurisdictions, paid-if-paid clauses are void when they weaken the subcontractor’s ability to file a mechanic’s lien. A mechanic’s lien is a claim against the project owner’s physical property to secure payment for labor or materials supplied for a private construction project. An argument against laws like SB550 is that subcontractors can remedy nonpayment for a job by filing a mechanic’s lien and directly pursue the private project’s owner. Most states also have lien and fund trapping statutes that help subcontractors get paid. However, filing mechanic’s liens is a complex and time-consuming process, and SB550 gives subcontractors additional protection.

It is uncertain whether other states will follow Virginia’s lead and ban paid-if-paid clauses. SB550 is a significant bill because Virginia’s historic view on contract law is that a contract’s terms usually supersede other provisions. Any new paid-if-paid laws throughout the country will likely result on a state-by-state basis, rather than states coming together to pass new legislation. WFJ will continue to stay up to date on paid-if-paid laws and all other mechanic’s lien and payment bond laws in the United States and Canada to ensure our clients are protected and fully informed of their rights.

[1] See Galloway Corp. v. S.B. Ballard Const. Co., 464 S.E.2d 349 (Va. 1995); see also Universal Concrete Products v. Turner Const. Co., 595 F.3d 527 (4th Cir. 2010).

[2] The other six states are California, Delaware (for private contracts), New York, North Carolina, South Carolina, and Wisconsin.

[3] The nine states include Illinois, Indiana, Kansas, Maryland, Massachusetts, Montana, Nevada, Ohio, and Utah.

May was Mental Health Awareness Month, which aims to bring awareness to and reduce the stigma of mental health issues.  Recently, PwC announced that it would be embracing the movement and investing $2.4 billion (yes, that’s billion with a “b”), into programs meant to improve employee mental health and wellness.  These new wellness driven policies provide employees with options to establish work schedules and locations that are most conducive to the employee’s present circumstances.  In addition, the company will shut down for two weeks in both July and December to encourage time away from work, provide expanded parental leave, give mid-fiscal-year salary increases to all employees, and offer professional development opportunities.

Research shows that when employees are struggling, a company’s bottom line can also suffer.  For example, a study published by the American Psychiatric Association Foundation’s Center for Workplace Mental health found that employee depression, which can lead to increased absenteeism and lost productivity, costs the U.S. economy more than $210 billion each year (there’s that “b” for billion again).  Not only is it the right thing to do to take steps to improve employee wellness, but the investments can lead to increased productivity and output, and thus higher profits.

While most companies cannot invest billions of dollars into employee wellness programs like PwC, there are many low-cost measures companies can take to improve mental health and wellness, such as the examples below.

Train Managers to Spot the Signs of a Struggling Employee: Front-line managers should have a basic understanding of the warning signs that an employee may be struggling with their mental health.  For example, perhaps a once-stellar employee is now struggling to complete projects on time or turns in work riddled with errors.  Another employee may have had a great attendance record, but suddenly is absent or tardy from work often.  These issues could stem from depression, anxiety, or other mental health conditions, rather than just sudden poor performance.  Managers should also know that certain employees may be at higher risk of suffering from work-related stressors.  Common examples of workplace triggers include employees who work alone, in high-risk positions, or have intense workloads.  If a manager senses an employee is struggling, the manager should understand how to broach the subject with the employee, what to say, and just as importantly, what not to say.

Understand How to Properly Handle Employee Reporting of Mental Health Issues: If an employee discloses that they are struggling with their mental health, employers should understand their potential legal obligations under the Americans with Disabilities Act and corresponding state laws.  Employees may be entitled to reasonable accommodations such as additional break time, modifications to work schedules, or unpaid leave.  It may also be appropriate for the employer to offer resources to the employee.  For example, if the company has an Employee Assistance Program (EAP), the employer can refer the employee to the EAP, who can then connect the employee with the necessary resources.  Often employees either forget about their EAP options or are hesitant to reach out believing their situation is not serious enough and need some encouragement.

Conduct High-Quality Check-Ins to Build Connections: The COVID-19 pandemic left many people feeling isolated from family, friends, and colleagues, which can have a corresponding negative impact on an individual’s well-being.  Even as more employees have returned to working on-site, there is no doubt that remote/hybrid work arrangements are here to stay.  A tool companies can use to help combat employee isolation is to conduct more frequent, but shorter duration, check-ins.  The practice of conducting once-annual performance reviews for the sole purpose of analyzing wage increases is often inadequate to address employee performance, and certainly does not help with employee engagement.  Rather, employers should take care to really listen to their employees.  Employees who feel their concerns are taken seriously, and that they are given opportunities to assist the company with solving workplace problems, are likely to feel more engaged, valued, and have better job satisfaction.

While there is no one-size-fits-all approach to implementing programs and policies that will improve employee wellness, there are many steps companies can take which require minimal capital investments, but that ultimately pay dividends.