New Jersey Supreme Court Holds That Economic Loss is Not Needed To Recoup a Former Employee’s Salary for Breach of the Duty of Loyalty

Posted on September 29th, by Editor in Crisis Management. No Comments

By Lynne Anne Anderson

On September 22, the New Jersey Supreme Court unanimously gave the green light to awards of the remedy of equitable disgorgement, even in the absence of economic loss, as a fair and practical response to an employee’s disloyal conduct. The Court also noted that the fear of disgorgement should serve to as a deterrent to employee misconduct. Bruce Kaye v. Alan P. Rosefielde (A-93-13) (073353), New Jersey Supreme Court.  

The Facts of the Case

Bruce Kaye hired attorney Alan Rosefielde as a full-time, salaried employee after using him as outside counsel. Rosefielde served as Chief Operating Officer and General Counsel for some of Kaye’s timeshare businesses. Kaye terminated Rosefielde’s employment based on discovery of unauthorized self-dealing and other actions by Rosefielde that exposed Kaye’s companies to potential liability, and as result of dissatisfaction with Rosefielde’s job performance. Kaye … Read More »

The DOL Announces Final Rule for the Obama Administration’s 2014 Pay Transparency Executive Order

Posted on September 17th, by Editor in Counseling & Compliance Training, Fair Pay Act Obligations. No Comments

By Dennis Mulgrew and Laurie Holmes

As we’ve previously covered here, on April 8, 2014 President Obama signed Executive Order 13665 (“Non-Retaliation for Disclosure of Compensation Information), at an event commemorating National Equal Pay Day, an annual public awareness event that aims to draw attention to the gender wage gap. On September 10, 2015, the Department of Labor’s Office of Federal Contract Compliance Programs (“OFCCP”) announced the Final Rule implementing the Order, which will take effect on January 11, 2016.

In its press release announcing the Final Rule, the DOL highlighted its intent to specifically address the gender pay gap, stating that “a culture of secrecy keeps women from knowing that they are underpaid, and makes it difficult to enforce equal pay laws. Prohibiting pay secrecy policies and promoting pay transparency helps address the persistent pay gap for women . . .”

The … Read More »

Obama Board Reaffirms Successor’s Right to Set Initial Terms of Employment when Taking Over Unionized Operation

Posted on September 9th, by Editor in Audits/Due Diligence. No Comments

By  Gerald T. Hathaway or Shavaun Adams Taylor

Last week, the National Labor Relations Board issued a refreshingly employer-friendly decision which allowed a successor company to implement new pay terms without having to first bargain with the labor union. In Paragon Systems, Inc., 362 NLRB No. 182 (2015), a divided three-member Board panel held that the new guard service, Paragon Systems, Inc. (Paragon), had given sufficient notice to employees of a change in pay and therefore could assert its right to unilaterally set the initial terms and conditions of employment when it assumed a federal contract from the predecessor employer, MVM, whose work force was represented by The Federal Contract Guards of America International Union.

A Successor Can Make Unilateral Changes

In 2011, the Board reinstated the “successor bar” doctrine, where a union is presumed to retain its majority status when the … Read More »

The NLRB Expands the Definition of “Joint Employer”

Posted on September 3rd, by Editor in Audits/Due Diligence. No Comments

By William R. Horwitz and Philippe A. Lebel

Yesterday, the National Labor Relations Board (the “NLRB” or “Board”) issued a decision greatly expanding the standard for determining whether a company may be deemed a “joint employer.”  The Board’s decision, in Browning-Ferris Industries of California, Inc., overturned the narrower standard that the Board had been applying for 30 years.  The impact on companies that rely on staffing agencies and contractors is likely to be significant and the effects may ripple into the world of franchised business.

The Previous Joint Employer Standard

The National Labor Relations Act (“NLRA”) imposes numerous obligations on employers, including the duty to bargain with a union that workers select as their designated representative.  These obligations can extend to a company that does not directly employ the workers in a traditional sense, if the company is deemed to be a … Read More »

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