Showing 115 posts from 2012.

Tax Court Finds Masonry Contractors to be “Employees”

October 29, 2012 by Hinshaw & Culbertson LLP

In this case, the employer, an S corporation that operated a masonry subcontracting business, treated its workers as independent contractors and not employees. The workers were hired on a per-job basis, brought their own tools to the jobs, were free to work for other employers and were paid on a piecework basis in cash. The payments made to the workers were often not adequately recorded and minimal documentation existed. The employer was then selected for an employment tax audit through which the Internal Revenue Service (IRS) determined the workers should have been categorized as employees. As a result it determined the employer owed employment taxes it should have originally withheld, along with penalties and interest on these amounts and penalties for the failure to file returns and remit these amounts. More ›

Seventh Circuit Affirms Summary Judgment Against Illinois Eavesdropping Law Claim

October 5, 2012 by Ambrose V. McCall

Illinois is somewhat unique among the states when it comes to its eavesdropping statute. Illinois has a statute which prohibits recording a phone conversation unless all the parties to the conversation consent. 720 ILCS 5/14-2(a)(1). In the same act, persons are barred from later using or distributing any data procured through a recording that lacks the required unanimous consent. 720 ILCS 5/14-2(a)(3). There are exceptions, and a significant one covers a situation where one of the parties to the conversation has fear of a crime occurring. 720 ILCS 5/14-3(i). The statutory exception imposes specific requirements, including that one of the parties to the conversation makes or requests the making of the recording, that said person has a reasonable suspicion that another party to the conversation has committed, is committing, or is about to commit a crime against that person or a member of that person's immediate household, and that the recording of the conversation may produce evidence of that criminal offense. Id. More ›

NLRB: Auto Dealership did not Violate Labor Law when it Fired Employee for Posting Facebook Photos of Accident at Sales Event

October 2, 2012 by Hinshaw & Culbertson LLP

In a decision made public yesterday, the National Labor Relations Board determined that a car dealership employee who was terminated for posting mocking photos on Facebook of a serious accident at its "Ultimate Driving Event" was not engaged in concerted activity, and that his termination. therefore, did not violate the National Labor Relations Act. The decision in Knauz Motors, Inc. d/b/a Knauz BMW, Case 13-CA-046452 (Sep. 28, 2012), is not all good news for employers, however, as the Board suggested that other photos posted by the employee, which mocked the food at the sales event — but which no other employee commented on or joined in — constituted protected activity because they related to earlier complaints from the sales team regarding the food. More ›

Connecticut Court: Dodd-Frank "Whistleblower" Protection Extends to Informal SEC Complaints

September 28, 2012 by Hinshaw & Culbertson LLP

A federal district court in Connecticut this week held that the federal Dodd-Frank Act protects a larger class of “whistleblowers” than many previously thought. In allowing the claimant’s “whistleblower" retaliation claim to survive a motion to dismiss, the judge ruled that Dodd-Frank’s definition of “whistleblower” was broad enough to protect not only those who file official complaints with the Security and Exchange Commission (SEC), but also those who provide the SEC with informal letters complaining of unlawful practices. The judge rejected concerns that such an interpretation would allow Dodd-Frank’s anti-retaliation provision — with its longer statute of limitations and double-pay awards – to effectively swallow the corresponding provisions of the (less claimant-friendly) Sarbanes-Oxley Act: “the Dodd-Frank Act appears to have been intended to expand upon the protections of Sarbanes-Oxley,” the judge noted, “and thus the claimed problem is no problem at all.” More ›

Sixth Circuit Affirms: Certain Severance Payments are Exempt from FICA Tax

September 27, 2012 by Hinshaw & Culbertson LLP

In United States v. Quality Stores, Inc., No. 10-1563 (Sept. 7, 2012), an employer operating a chain of retail stores closed a number of facilities prior to entering bankruptcy proceedings. As part of this reduction in force, the employer provided certain severance benefits to terminated employees. The employer treated the severance benefits as income and reported them as wages on Forms W-2, with Federal Insurance Contributions Act (FICA) taxes withheld. After remitting the taxes to the Internal Revenue Service (IRS), the employer filed a claim for refund to recover more than $1 million in FICA taxes, arguing that the severance payments were not properly treated as "wages" for FICA tax purposes. More ›

Transferring Employee to Different Geographical Location for Better Access to Medical Care Found to Be Reasonable Accommodation

September 27, 2012 by Hinshaw & Culbertson LLP

Recently, the United States Court of Appeals for the Tenth Circuit held that an employee’s request for a transfer to a different geographical location in order to have better access to medical treatment was not unreasonable. More ›

Right-to-Sue Letter Directed to Attorney Constituted Notice to Employee for Purposes of Filing Timely Lawsuit

September 25, 2012 by Hinshaw & Culbertson LLP

After she was denied sick leave, a doctor filed a complaint with the anti-discrimination unit of the Puerto Rico Department of Labor and Human Resources, alleging unlawful discrimination and unwarranted refusal to make a reasonable accommodation for her disability. The local agency referred the matter to the Equal Employment Opportunity Commission (EEOC), and without considering the merits, the EEOC issued a right-to-sue letter. The notice was sent to the doctor, her attorney, and to the employer, and stated that the doctor had 90 days in which to file a Title I action against her employer. Approximately 144 days after the right-to-sue letter was sent, the doctor sued her former employer for violations of the Americans with Disabilities Act. The employer argued that the case should be dismissed because the doctor’s claim was time barred. More ›

Employer did not Discriminate or Retaliate Against Disabled Employee who was Unable to Perform In-Person Supervision Tasks

September 24, 2012 by Hinshaw & Culbertson LLP

A supervisor of released adult offenders suffered from sacroiliac joint dysfunction, a condition causing pain in the joints that limited her ability to walk and forced her to work from home. After surgery, she made a full return to work, but roughly a year and a half later she fell down stairs at work and the symptoms of her condition returned. She had a second surgery and took leave under the Family and Medical Leave Act (FMLA) to recover. She was terminated after her FMLA leave expired. More ›

Are Bonuses part of "Earnings" for the Purposes of Calculating Disability Benefits?

September 19, 2012 by Hinshaw & Culbertson LLP

The Ninth Circuit Court of Appeals recently had cause to consider this very issue. Unfortunately, we did not get a clear answer, as the matter was sent back down for the district court to reconsider a whole host of issues before deciding whether the insurance company had the right to calculate benefits based on salary alone. More ›

NLRB: Employer’s Overbroad Social Media Policy Violates Employees’ Rights

September 19, 2012 by Hinshaw & Culbertson LLP

In its first decision involving an employer’s social media policy, the National Labor Relations Board (Board) found that an employer's policy violated employees’ rights under the National Labor Relations Act. The Board reasoned that the policy was written in overly general terms and therefore had “a reasonable tendency to inhibit employees’ protected activity.” This decision follows a series of social media reports issued by the Board over the past year, and appears to confirm what many employers had feared based upon those reports: the Board appears ready to reject all broad prohibitions on what employees may say online. More ›

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