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Posts Tagged ‘Pennsylvania’

Discrimination Suit Over Service Dog Revived By Third Circuit

Posted on: August 23rd, 2018

By: Barry Brownstein

The Third Circuit has revived a lawsuit by the parents of an epileptic girl who claim a Pennsylvania school discriminated against her by barring her service dog.

In 2014, Traci and Joseph Berardelli sued the Allied Services Institute of Rehabilitation Medicine, which operates a school with a specialized program for dyslexic students, after it barred their daughter from bringing her service dog to school to help alert staff to her epileptic seizures. The school claimed the dog would be a distraction, and the Berardelli’s daughter missed many school days when her seizures were bad. When the school finally permitted the service dog to accompany her, the reprieve did not last long, as school officials required that it wear a “special therapeutic shirt designed to decrease allergens” that caused the dog to overheat. The parents’ lawsuit alleged that the school violated the ADA, the Rehabilitation Act, and a Pennsylvania discrimination law.

The United States District Court for the Middle District of Pennsylvania dismissed the ADA and state discrimination claims, ruling that they improperly sought damages.

On appeal, Traci and Joseph Berardelli argued that “reasonable modifications” required under the ADA are substantively the same as “reasonable accommodations” provided for in the Rehabilitation Act, and thus, service animal requirements in the ADA apply to both laws.

The Third Circuit ruled that the district court erred in its instructions to the jury about the Rehabilitation Act claim and improperly disallowed testimony about ADA service animal regulations because that was not the law being considered.  In its enforcement of the ADA, the Department of Justice has ruled that service animals are reasonably permitted to be used by disabled persons in public places as long as they are housebroken, not out of control, and pose no risk to the public.

The Third Circuit ruled that the Rehabilitation Act of 1973 and its progeny the Americans With Disabilities Act of 1990 must be interpreted the same way with respect to reasonable accommodations that must be provided to those with disabilities, including the use of service animals. Thus, under the Rehabilitation Act just as under the ADA, a covered actor ordinarily must accommodate the use of service animals by individuals with disabilities. The Third Circuit also overturned dismissal of the claim made under Pennsylvania discrimination law, ruling that the district court erred because that law does permit damages as a remedy.

If you have any questions or would like more information, please contact Barry Brownstein at [email protected].

Amendments To Pennsylvania’s CASPA Will Change The Landscape Of Payment Disputes

Posted on: August 3rd, 2018

By: Jonathan Romvary

Anyone who has ever done any amount of work as a contractor or who has represented them in collections cases has learned from hard experience that it can be all but impossible to get paid for one’s work. In Pennsylvania, the Contractor and Subcontractor Act (CASPA) was introduced in 1994 as a complement to the Pennsylvania Mechanic’s Lien Law and was intended to provide contractors (and subcontractors) with additional remedies against those owners/contractors withholding payment for their services. However, the landscape of these payment disputes is likely to significantly change as a result of recent legislation.

Last year, a Pennsylvania state representative introduced a bill, which sought to substantially amend the act and for the first time since 1994, provide further protections for contractors against those withholding funds for the work. That bill has languished in the House Commerce Committee since last year. Nonetheless, a similar bill amending CASPA was referred to the state senate and in June 2018, Governor Tom Wolf signed the bill into law as Act 27. Amongst the numerous amendments to CASPA, Act 27 now provides:

  • If an owner fails to adhere to the terms or withholds payment, contractors and subcontractors may stop performance of the work (subject to contractual limits);
  • There is no permissible waiver of any provision of CASPA;
  • Failure to provide the contractor with a 14 day written notice of a deficiency results in a waiver of the right to withhold payment for the deficiency and requires full payment of the invoice;
  • If a party alleges an invoice contains an error, that party must pay the correct amount on the date payment would otherwise be due otherwise it will be an improper withholding; and,
  • Withholding retention for longer than 30 days after final acceptance of the work generally qualifies as improper withholding.

These new changes are scheduled to take effect on October 10.

Without question, these changes increase the negotiation power of contractors and subcontractors, however, more importantly, the changes reinforce the need for owners and contractors to maintain clear payment records as only clear payment records will provide owners and contractors a sufficient defense in any payment dispute. Owners, contractors and subcontractors involved in payment disputes need to be aware of their respective obligations and rights.

Anyone in the construction industry that has questions about these amendments and how they may affect their business or current projects, please contact Jonathan Romvary at [email protected].

Coffee, Water, Less Than 20 Minutes

Posted on: June 19th, 2018

SCOTUS KICKS THE CAN ON SHORT BREAKS COMPENSATION

By: John McAvoy

On June 11, 2018, the U.S. Supreme Court refused to entertain the appeal of a Pennsylvania employer that could have resolved the emerging split of authority between the federal appellate courts and the U.S. Department of Labor (DOL) as to the compensability of employees’ short rest breaks.

In American Future Systems, Inc. d/b/a Progressive Business Publications v. R. Alexander Acosta, Secretary, U.S. Department of Labor, the Secretary of Labor filed suit against Progressive Business Publications, a company that publishes and distributes business publications and sells them through its sales representatives, as well as the company’s owner, alleging they violated the Fair Labor Standards Act (FLSA) by paying their salespeople an hourly wage and bonuses based on their number of sales per hour while they were logged onto the computer at their workstations, and by not paying them if they were logged off for more than 90 seconds.

The U.S. District Court for the Eastern District of Pennsylvania previously found that the employer’s policy had violated the FLSA, relying on a DOL regulation which states that “[r]est periods of short duration, running from 5 minutes to about 20 minutes, are common in industry.  They promote the efficiency of the employee and are customarily paid for as working time.  They must be counted as hours worked.”  In so holding, the District Court found that the employer was liable for at least $1.75 million in back wages and damages.

On appeal to the Third Circuit Court of Appeals, the employer argued that that it provided “flex time” rather than “breaks,” which allowed workers to clock out whenever they wanted, for any reason.  In other words, that the employees were not “working” after they logged off of their computers since they could do anything they wanted, including leaving the office.  The appellate court rejected this argument, reasoning that to dock the pay of employees who can’t manage a bathroom sprint is “absolutely contrary to the FLSA,” and affirmed the lower court’s decision.

The Third Circuit’s reliance on DOL regulation was contrary to the holdings of some of the other circuit courts which opted to assess the circumstances of the break in lieu of interpreting the DOL regulation as a bright-line rule that fails to take into consideration the facts of a particular situation.

The employer asked the U.S. Supreme Court to clarify how compensability for breaks should be determined.  Citing the circuit split, the employer posited that the question of break pay should be determined by assessing the circumstances of the break, rather than adopting the DOL regulation as a bright-line rule.  In its reply brief, the DOL fervently defended its regulations and denied the existence of the alleged circuit split, arguing that “hours worked [are] not limited to the time an employee actually performs his or her job duties.”  Unfortunately, this remains an issue for another day as the Supreme Court refused to hear the case and/or resolve the alleged split.

Absent a decision from the Supreme Court to the contrary, employers in Pennsylvania, New Jersey, and Delaware are bound by the Third Circuit’s decision. As such, employers in these states must continue to comply with DOL regulations with respect to the compensability of short breaks.

Fortunately, the applicable DOL regulations are designed to protect employers’ rights. For starters, the regulations recognize that meal periods serve a different purpose than coffee or snack breaks and, as such, are not compensable.  Second, an employer need not count an employee’s unauthorized extensions of authorized work breaks as hours worked when the employer has expressly and unambiguously communicated to the employee that the authorized break may only last for a specific length of time, that any extension of the break is contrary to the employer’s rules, and any extension of the break will be punished.

Although an employer will have to compensate an employee who repeatedly takes unauthorized breaks lasting less than 20 minutes in order to comply with the Third Circuit’s ruling and the applicable DOL regulations, the employer is nevertheless free to discipline the employee for such indiscretions by whatever means the employer deems appropriate, including termination.

Prudent employers should prepare themselves to address such issues through smart planning and proper training of employees, including managers, supervisors and HR personnel to ensure the employer’s break, discipline, and termination policies and procedures comply with all applicable DOL regulations.

Want to know whether your company’s break, discipline, and termination policies and procedures comply with DOL regulations? Let me help. Please call or email me (215.789.4919; [email protected]).

PA Fed. Ct. Finds UberBLACK Limousine Drivers Maintain Independent Contractor Status

Posted on: April 30th, 2018

By: John P. McAvoy

On April 12, 2018, Uber Technologies, Inc. won its legal battle on the recurring issue of independent contractor misclassification when the Eastern District of Pennsylvania granted the company’s motion for summary judgment in Razak v. Uber Technologies, Inc., No. 16-cv-573 (E.D. Pa. Apr. 11, 2018) (Baylson, J.). In so holding, the court concluded that UberBLACK limousine drivers are not employees of Uber covered by state and federal wage laws.

Uber has been defending independent contractor misclassification cases in state and federal courts throughout the country since the company first opened its doors in 2009. Like several other ride-sharing companies, Uber has persistently maintained that its drivers are independent contractors and that, as such, the company is exempt from the state and federal wages laws of all jurisdictions in which it conducts business. Despite these salient arguments, the vast majority of courts have concluded that the workers were Uber employees subject to wage laws, indicating that a slightly different set of facts may have swayed the decision in the other direction. However, based on the Honorable Michael M. Baylson’s opinion in the Razak case, it appears this pattern has reached its natural end.

Unlike other federal and state courts that have addressed this issue, the Eastern District concluded that almost all of the factors the court considered weighed heavily in favor of classifying UberBLACK limousine drivers as independent contractors that do not enjoy the rights, benefits and securities provided by state and federal wage laws.

The Eastern District reached its decision by applying the six factor test set forth in Donovan v. Dialamerica Marketing, Inc., 757 F.2d 1376 (3d Cir. 1985); namely, (1) the degree of Uber’s right to control the manner in which the work is performed (“Right to Control”); (2) the UberBLACK limousine drivers’ opportunity for profit or loss depending on their managerial skill (“Opportunity for Profit or Loss”); (3) the UberBLACK limousine drivers’ investment in equipment or materials required for their task, or their employment of helpers (“Employee Investment”); (4) whether the service rendered requires a special skill (“Special Skills”); (5) the degree of permanence of the working relationship (“Relationship Permanence”); and (6) whether the service rendered is an integral part of Uber’s business (“Integration”). The court found that all but two of the factors (i.e., Special Skills and Integration) strongly favored independent contractor status. Accordingly, the court concluded that the UberBLACK limousine drivers had not met their burden of showing that they are employees and that Uber is their employer.

If upheld on appeal to the Third Circuit, the Razak decision could finally put to rest the issue of whether Uber drivers and workers at companies that employ similar business models are being misclassified as independent contractors under the Fair Labor Standards Act and any state wage laws that test for independent contractor status in the same or similar fashion.

If you have any questions or would like more information about this case, please contact John P. McAvoy at [email protected].