Wage Theft Significant Problem, Minneapolis City Council to Address

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Wage theft is the illegal practice of employers not paying workers for their labor, or their work. Wage theft includes failing to pay minimum wage, failing to pay overtime, failing to pay workers the wage that was promised, forcing workers to work ‘off the clock,’ and many other illegal practices.

Wage theft is a major problem in the United States, and in Minnesota in particular. In fact, the Minneapolis City Council has recently announced its intent to address the widespread problem of wage theft, according to media coverage.

It is encouraging to see the Minneapolis City Council’s interest in addressing this widespread and growing problem. But it is important for workers to know that federal and state laws, including the Fair Labor Standards Act (FLSA), and Minnesota Fair Labor Standards Act both provide legal recourse for some of the problems of wage theft. In fact, Teske Katz Kitzer & Rochel, in collaboration with Nichols Kaster, recently helped expand the potential theories of recovery available to workers who are not paid at the rate that they were promised, in Shoots v. iQor Holdings, Inc.

One of the problems allowing for wage theft are workers not being fully aware of all of their rights under existing laws, as well as new laws that may be passed, such as Minneapolis’s goal of city council action. If you have questions about wage theft, or are concerned that you and/or your coworkers are not being paid for work, or are not being paid fairly, contact Teske Katz Kitzer & Rochel today.

Whistleblowers Reveal Widespread Fraud at Large Twin Cities Mental Health Agency

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Several whistleblowers have brought to light allegations of widespread fraud by Complementary Support Services (CSS). According to allegations from federal and state prosecutors, the mental healthcare provider defrauded Minnesota’s Medicaid program for millions of dollars and provided inadequate supervision of unlicensed practitioners. The state and federal prosecutors filed suit against CSS in November of 2015.

Several employees have come forward to blow the whistle and publicly report the fraud as well as retaliation and alleged blackmail of CSS employees. According to Naomi Davis, CSS threatened to withhold her paycheck if she did not agree to file false reports. Such claims could give rise to employment retaliation and whistleblower claims.

In addition, a qui tam, or False Claims Act (FCA) lawsuit was filed in 2013 against CSS, and both the United States and Minnesota governments have joined the suit. The lawsuit was initially filed under seal, as required by state and federal law, and was recently made public by the Court. The whistleblower lawsuit was filed by William Schwandt as a relator on behalf of both the United States and Minnesota.

These whistleblowers highlight the need for individuals to report government fraud, waste and abuse, and the important role that whistleblower reward laws–or qui tam laws, as they are sometimes called–play in stopping and correcting fraud in our community. There are robust laws that reward individuals who report fraud and even allow such individuals to file lawsuits on behalf of the government in order to recover the improperly-obtained money. In addition, there are many laws that protect employees who act as whistleblowers, preventing them from being retaliated against or fired for reporting or refusing to engage in fraud or other illegal conduct. In addition, some laws allow individuals to file confidential complaints in order to protect them from their employer or others of learning their identity.

Teske Katz Kitzer & Rochel has a proven track record of representing whistleblowers. If you have questions or feel that you may be aware of government fraud, contact us today for a free consultation.

Minnesota Court of Appeals Holds Restrictive Covenant against Employee Not Enforceable

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In a potentially significant case, the Minnesota Court of Appeals held that a non-solicitation agreement was not enforceable because it did not include specific reference to consideration in exchange for the agreement not to solicit within the agreement. The case, JAB, Inc. v. Naegle, resulted in the employee’s non-solicitation agreement being unenforceable.

Under basic principles of contract law, a contract (including an agreement for a non-compete or non-solicitation) requires consideration. This means that both parties receive something in return–here, the employer received the agreement not to solicit employees after the employee left the company, but the agreement did not provide anything to the employee in return. The important rule from Naegle is that, when a contract that cannot be fully performed within one year (such as a two year non-solicitation agreement), then the contract must include express reference to the consideration within the contract or it is not enforceable.

Click here for a copy of the full Court of Appeals decision. If you have questions about a non-solicitation agreement, a non-compete agreement, or any other employment law questions, please contact Teske Katz Kitzer & Rochel today for a free consultation.

 

Supreme Court Recognizes Constitutional Right to Marriage Equality

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Today, the United States Supreme Court agreed that the Constitution granted the liberty “to define and express their identity” by “marrying someone of the same sex and having their marriages deemed lawful on the same terms and conditions as marriages between persons of the opposite sex.” The groundbreaking decision, available here, recognized that the personal choice of who to marry is “inherent in the concept of individual autonomy,” a central concept of the Fourteenth Amendment’s protections of life, liberty and property. Justice Anthony Kennedy, writing for the Court, eloquently summed up the matter in his concluding statement:

“No union is more profound than marriage, for it embodies the highest ideals of love, fidelity, devotion, sacrifice, and family. In forming a marital union, two people become something greater than they once were. As some of the petitioners in these cases demonstrate, marriage embodies a love that may endure even past death. It would misunderstand these men and women to say that they disrespect the idea of marriage. Their plea is that they do respect it, respect it so deeply that they seek to find its fulfillment for themselves. Their hope is not to be condemned to live in loneliness, excluded from one of civilization’s oldest institutions. They ask for equal dignity in the eyes of the law. The Constitution grants them that right.”

The Minnesota Human Rights Act has long recognized the right to equal treatment of individuals regardless of their sexual orientation and sexual identity. It is illegal for an employer to discriminate against an employee based on the employee’s sexual orientation, self-image, and identity. In fact, recognizing that discriminators often try to stigmatize people based on sexual orientation and identity, Minnesota law also prohibits discrimination based on perceived sexual orientation and identity. And, if an employee complains about sexual orientation discrimination, Minnesota law protects them from retaliation.

For more information about the impact of the Supreme Court’s ruling, or employment law protecting the LGBTQ community, please contact us.

8th Circuit Reverses Summary Judgment on FMLA Claims

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The Eighth Circuit reversed summary judgment on an FMLA entitlement and discrimination claim.  In Hudson v. Tyson Fresh Meats, Inc., the Court found that sufficient evidence of FMLA discrimination and interference existed to allow the matter to proceed to trial.   ___ F.3d. ___, 2015 U.S. App. LEXIS 8479 (8th Cir. May 28, 2015).  

Plaintiff Delbert Hudson was fired after taking a short leave for back problems and depression.  Hudson’s girlfriend, also an employee at Tyson, told Hudson’s supervisor that he would be absent for a few days, and Plaintiff texted his supervisor about being out. When he returned to work, Hudson was fired for failing to call in each day pursuant to company policy.  Hudson sued for FMLA interference and discrimination.

The district court granted summary judgment on both claims, and the Court of Appeals reversed.  First, the Court held that Tyson failed to restore Hudson to the same or similar position after his leave, as required by the FMLA.  Tyson argued that it “returned Hudson to his normal job duties for a person Human Resources was investigating,” but the Court rejected that argument because Tyson failed to cite any authority to support its legal theory.

Next, the Court held that Hudson FMLA discrimination claim should go to trial.  Specifically, the Court held that Tyson’s shifting reason for termination (first for failing to provide notice, then for not providing notice in the appropriate manner), and evidence suggesting Tyson did not consistently enforce the call-in policy could convince a jury that its alleged reason for termination was a pretext to discrimination.

The decision can be found here.  The FMLA entitles employees to take legally-protected leave, and protects employees from discrimination and retaliation for excercising rights under the FMLA. In addition, many states (including Minnesota) have passed their own versions of leave laws that may afford even more protections than the FMLA. If you have questions about the FMLA, or any other employment law issue, contact Teske Katz Kitzer & Rochel.