Employment law cases range from disputes over unpaid wages (pursuant to the North Carolina Wage and Hour Act) to enforcement of confidentiality, non-solicitation, and non-competition agreements, to discrimination claims by a member of a protected class (i.e., on the basis of race, gender, religion, age, medical impairment, etc.), to name a few. Trey has significant experience representing both employers and employees in these disputes. He has secured temporary, preliminary, and permanent injunctions against former employees of his clients to enforce the provisions of their employment contracts in general and non-compete agreements in particular. Conversely, he has defended former employees against efforts to enforce invalid non-compete agreements. Trey also he represented an employee and former CEO of a company in a federal bench trial to recover severance benefits of over $1 million. On appeal, the verdict was upheld in favor of Trey’s client and, additionally, he recovered the costs of the trial and the appeal.
In North Carolina, as in most states, the employment relationship is said to be “at will”, meaning either the employer or the employee can terminate the employment relationship without notice and for any reason. If a written employment contract exists between the parties, the employment may not be at will and could confer additional rights and obligations on the parties.
Even though at will employees in North Carolina can be terminated for no reason, they cannot be terminated for unlawful reasons (such as on the basis of sex or race or for serving on jury duty). If an employee is terminated for a reason that contradicts the law or public policies of the State, the employer may be held liable.
The U.S. Equal Employment Opportunity Commission (“EEOC”) is responsible for enforcing laws prohibiting discrimination on the basis of race, color, religion, sex (including pregnancy), nation origin, age (40 or older), disability, or genetic information.
Title VII of the Civil Rights Act prohibits discrimination against someone on the basis of race, color, religion, sex, or national origin as well as retaliating against them for complaining about discrimination, filing a charge of discrimination, or participating in an investigation regarding discrimination. The Pregnancy Discrimination Act amended Title VII to prohibit discrimination against women because of pregnancy, childbirth, or a medical condition related thereto. Another amendment made it illegal to discriminate against qualified persons with disabilities.
Of the five protected classifications, all but religion are immutable characteristics the potential employee had no choice in and can do nothing about. The purpose of the Act is to promote equal opportunity by prohibiting stereotype-based discrimination.
The Act applies to private employers with fifteen (15) or more employees and all federal, state, and local government employers.
You must file your complaint or charge with the EEOC within 180 days after the occurrence of the alleged unlawful employment practice. North Carolina has a nearly identical law, the Equal Employment Practices Act, and complaints can also be filed with the Civil Rights Division (“CRD”) of the North Carolina Office of Administrative Hearings. The EEOC or CRD will notify the employer of the allegations.
They will investigate your claim and, if merited, attempt to resolve it through conciliation. If no resolution is reached, the EEOC or CRD may bring a lawsuit on your behalf and, to the extent damages are awarded, deliver them to you.
I filed a complaint with the EEOC and/or CRD, but they are letting my employer off the hook. They sent me a letter saying they weren’t going to pursue my case; is there anything else I can do?
The letter you received is called a “right to sue” letter. You typically only have 90 days from receipt of that letter to file suit against your employer for discrimination. The EEOC or CRD’s decision not to file suit on your behalf does not mean they consider your claim invalid. The government has limited resources and cannot pursue every legitimate case. Never assume your case is weak because it didn’t receive more attention from these agencies; consult an attorney experienced in employment litigation to determine what next steps are most appropriate for you.
If you prevail at trial, you may be awarded reinstatement of your job and back pay. If reinstatement is impracticable or impossible, you may also be entitled to front pay. Compensatory damages (in the case of intentional discrimination) for such things as future pecuniary losses, emotional pain, suffering, inconvenience, mental anguish, and/or loss of enjoyment of life are possibly recoverable as well. Depending on the severity of the offense, you may also be entitled to an award of punitive damages and attorneys’ fees.
Americans with Disabilities Act (“ADA”)prohibits discrimination against qualified persons with physical or mental disabilities or retaliating against them for complaining about discrimination, filing a charge of discrimination, or participating in an investigation regarding discrimination. This law also requires employers to provide reasonable accommodations for qualified persons with disabilities unless doing so would impose an undue hardship on the operation of the employer’s business.
The ADA prohibits discriminating (in job application procedures, hiring, advancement, discharge, compensation, job training, and other terms, conditions, and privileges of employment) against qualified individuals because of their disabilities.
What does it mean to be a qualified individual with a disability?
A qualified individual with a disability is one who, with or without reasonable accommodation, can perform the essential functions of their current or desired employment position.
According to the ADA, a “disability” is defined as (a) a physical or mental impairment that substantially limits one or more major life activities and for which the individual (b) has a record of such an impairment or (c) is regarded as having such an impairment.
While it is not possible to create an exhaustive list of disabilities that would qualify under the ADA, some examples are: asthma, blindness or other visual impairments that cannot be corrected with prescriptive lenses, cerebral palsy, clinical depression, post-traumatic stress disorder (“PTSD”), diabetes, epilepsy, hearing or speech impairments, chronic migraine headaches, multiple sclerosis, muscular dystrophy, orthopedic impairments, paralysis, complications from pregnancy, thyroid gland disorders, tuberculosis, and the loss of body parts.
While there is no exhaustive list of conditions that aren’t covered by the ADA, examples include: sexual disorders, gambling, kleptomania, pyromania, current engagement of illegal drug use (rehabilitated drug and alcohol abusers are covered), the flu, gastrointestinal disorders, sprained joints and limbs, and other temporary, non-chronic impairments of short duration with little or no residual effects.
What it means to be a reasonable accommodation is a fact specific inquiry and the accommodation need not be ideal—the burden of proof is on the individual to prove an accommodation exists that will permit him or her to perform the essential functions of the job. However, accommodations that require the employer to shoulder undue hardship or expense are not required.
The ADA applies to private employers with fifteen (15) or more employees and all federal, state, and local government employers.
You must file your complaint or charge with the EEOC within 180 days after the occurrence of the alleged unlawful employment practice. North Carolina has a nearly identical law, the Equal Employment Practices Act, and complaints can also be filed with the Civil Rights Division (“CRD”) of the North Carolina Office of Administrative Hearings. The EEOC or CRD will notify the employer of the allegations.
They will investigate your claim and, if merited, attempt to resolve it through conciliation. If no resolution is reached, the EEOC or CRD may bring a lawsuit on your behalf and, to the extent damages are awarded, deliver them to you.
The letter you received is called a “right to sue” letter. You typically only have 90 days from receipt of that letter to file suit against your employer for discrimination. The EEOC or CRD’s decision not to file suit on your behalf does not mean they consider your claim invalid. The government has limited resources and cannot pursue every legitimate case. Never assume your case is weak because it didn’t receive more attention from these agencies; consult an attorney experienced in employment litigation to determine what next steps are most appropriate for you.
If you prevail at trial, you may be awarded reinstatement of your job and back pay. You may also be entitled to compensatory damages (in the case of intentional discrimination) for such things as future pecuniary losses, emotional pain, suffering, inconvenience, mental anguish, and/or loss of enjoyment of life as well as punitive damages, depending upon the egregiousness of the offense.
The threshold question to resolve is whether the employee is “disabled”. If medication or other devices can return them to normal condition, they will not be covered. Additionally, if they are performing a job that is not impacted or limited by their impairment, they may not be “disabled”.
Even if a given employee is disabled, they can still be terminated for misconduct. Customer preference in certain circumstances (e.g., a disfigured waiter), conditions that pose a direct threat to the employee, co-workers, customers, or the general public, and/or if there no feasible manner to accommodate the employee without creating undue hardship for the employer are all legal grounds for not hiring or terminating a disabled employee.
Age Discrimination in Employment Act (“ADEA”) protects people who are 40 years old or older from discrimination on the basis of age and makes it illegal to retaliate against them for complaining about discrimination, filing a charge of discrimination, or participating in an investigation regarding discrimination.
The ADEA prohibits discrimination in employment on the basis of age and protects people 40 years of age and above.
The Act applies to private employers with twenty (20) or more workers engaged in industries affecting interstate commerce, employment agencies, unions, and all federal, state, and local government employers.
You must file your complaint or charge with the EEOC within 180 days after the occurrence of the alleged unlawful employment practice. North Carolina has a nearly identical law, the Equal Employment Practices Act, and complaints can also be filed with the Civil Rights Division (“CRD”) of the North Carolina Office of Administrative Hearings. The EEOC or CRD will notify the employer of the allegations.
They will investigate your claim and, if merited, attempt to resolve it through conciliation. If no resolution is reached, the EEOC or CRD may bring a lawsuit on your behalf and, to the extent damages are awarded, deliver them to you.
The letter you received is called a “right to sue” letter. You typically only have 90 days from receipt of that letter to file suit against your employer for discrimination. The EEOC or CRD’s decision not to file suit on your behalf does not mean they consider your claim invalid. The government has limited resources and cannot pursue every legitimate case. Never assume your case is weak because it didn’t receive more attention from these agencies; consult an attorney experienced in employment litigation to determine what next steps are most appropriate for you.
If you prevail at trial, you may be awarded reinstatement of your job and back pay. If reinstatement is impracticable or impossible, you may be awarded front pay as well. You may also be entitled to compensatory damages (in the case of willful violation) of double damages.
One possible approach to prevent these claims is to grant larger severance packages in exchange for them waiving their right to sue. In order to be effective: (1) they must be voluntary and knowing agreements; (2) there must be full disclosure of the reasons for offering the severance package; (3) employees should be given a certain amount of time to decide and you must recommend that they consult with an attorney; and (4) they must be able to revoke the agreement within seven days of execution.
The Equal Pay Act (“EPA”) prohibits paying men and women different wages for performing the same work in the workplace or to retaliate against them for complaining about discrimination, filing a charge of discrimination, or participating in an investigation regarding discrimination.
There are advantages and disadvantages of filing a lawsuit pursuant to the EPA rather than Title VII.
The advantages are:
The disadvantages are:
In the final analysis, an employee who has an EPA claim should also file suit under Title VII (assuming a “right to sue” letter has been issued) to preserve the sex discrimination claims and the remedies it affords.
The primary purposes of the U.S. Department of Labor are to protect the welfare of wage earners and retirees, assure work-related benefits and rights, and enforce rules and laws designed to promote safe working conditions.
The Employment Retirement Income Security Act (“ERISA”) is the full body of laws regulating employee benefit (i.e., retirement and pension) plans and was enacted to protect the interests of employee benefit plan participants and the beneficiaries.
Although private employers aren’t required to offer any type of employee benefits, if they choose to provide benefits plans such as 401(k), health insurance, and/or disability insurance, then they are covered by ERISA.
The types of benefits covered by ERISA, should an employer choose to provide them, include but are not limited to:
A defined benefit plan, funded by an employer, promises a given employee a specific monthly benefit at retirement. A defined benefit plan could either be a specific amount each month or based on a formula and calculated using factors such as salary, age, position at retirement, and years with the company. Pension plans are defined benefit plans.
A defined contribution plan is one in which the employee and/or the employer contribute money to the employee’s individual account in the plan. A 401(k) plan is one example of a defined contribution plan.
ERISA does preempt state law. This becomes important in employment litigation disputes regarding severance packages or North Carolina Wage and Hour Act claims. Specifically, depending on the level of oversight required to administer the severance package, what appears to be a simple employment contract may in fact constitute an ERISA plan that would therefore preempt North Carolina’s Wage and Hour Act. The most glaring consequences are (1) plaintiff employees are not entitled to jury trials for ERISA claims and (2) they cannot recover liquidated damages of 100% of the outstanding wages owed, as they could under a Wage and Hour Act claim.
An employee may sue his or her plan or its fiduciaries to enforce or clarify his or her rights under ERISA in the following situations:
The Fair Labor Standards Act (“FLSA”) establishes a minimum wage applicable to all employees of covered employers and provides for mandatory overtime payment for covered employees who work more than 40 hours per week.
A business is covered if it has only two employees and meets the interstate commerce test. Goods or services produced or used by the business must cross state lines in order for an employer to be engaged in commerce within the meaning of the statute, but this requirement is broadly construed (e.g., an automotive store installing tires that are shipped across state lines would be covered). Some companies are exempted for reasons, such as only employing immediate members of the owner’s family, regardless of size. Executive, administrative, and professional employees paid on a salary basis are also exempt.
“Any individual employed by an Employer” is covered except: (1) jobs such as summer camp counselors, employees engaged in fishing, casual babysitters, and companions of the elderly; (2) occupations without traditional eight-hour days such as taxi drivers, radio and TV news announcers, transportation employees; and (3) independent contractors since they are not considered employees and have more control over the work they choose to perform
The primary tasks, duties, and responsibilities associated with the performance of a job obviously qualify as “work”. Additionally, all the following activities may also be considered compensable: off-the-clock time, time spent in preliminary activities (so long as it is not portal-to-portal time), break time, on-call time, and training.
Obviously, cash qualifies as pay. Employers should note that deductions in wages may drive them illegally below the minimum and non-cash payments and late payments may violate the FLSA.
An FLSA claim may be brought in state or federal court and there are no formal procedures or administrative exhaustion requirements, unlike Title VII and other federal laws. A class action may also be appropriate if enough employees are affected by the policy.
Workers can recover back wages and either interest or liquidated damages of up to 100% of the back pay award. The employer, however, may be able to avoid liquidated damages if it can prove it acted in good faith (with an honest intention to comply with the FLSA) and that its actions were reasonable. Attorneys’ fees and costs may also be recovered.
The statute of limitations for a claim under the FLSA is 2 years unless the plaintiff can prove “willfulness”, which extends the period to 3 years.
The Family and Medical Leave Act (“FMLA”) requires that employers provide leaves of absence for childbirth or the care of children, other family members, or even oneself.
Employers of fifty (50) or more employees.
Those employed for at least one year who have worked at least 1,250 hours of service during that year are eligible for coverage.
Covered employees are entitled to twelve (12) weeks of unpaid leave in any twelve (12) month period, with a guaranteed right of return to the same or an equivalent position.
The employer must maintain health insurance benefits, if any, at the same level and under the same conditions as if the employee were at work.
The employee must ask for leave and the employer must be reasonably convinced it fits under the FMLA. The employer has two (2) days to notify the employee whether it will constitute medical leave under the FMLA.
The employer may also require that the employee substitute accrued vacation leave, personal or family leave, or medical or sick leave for any part of the twelve-week FMLA leave and the employee must give notice of leave when foreseeable.
Unlike Title VII and other federal laws, private parties may bring a claim in state or federal court and there are no formal procedures or administrative exhaustion requirements.
Employees can recover lost wages and benefits, actual monetary losses (cost of paying for care the employee could have provided personally), interest, attorneys’ fees and costs, and an amount equal to the monetary recovery in liquidated damages unless the employer can prove it acted in good faith.
The North Carolina Department of Labor is charged with promoting the “health, safety and general well-being” of more than 4,000,000 workers in the state and is divided into three divisions: Administration, Occupational Safety and Health, and Standards and Inspections.
The North Carolina Wage and Hour Act and Administrative Rules protect employees by providing requirements regarding the payment of wages and benefits. Employers who have wrongfully withheld wages owed to an employee may be liable for twice the amount of the wrongfully withheld wages, costs, and the employee’s attorneys’ fees.
North Carolina Labor Laws.
Wages include any compensation for labor or services rendered, whether calculated on a task, hourly, job, daily, or salary basis. “Wage” also includes sick pay, vacation pay, commissions, bonuses, and other amounts promised by an employer with a policy or a practice of making such payments.
Employers can reduce pay rates if employees are notified in writing or through a posted notice prior to the effective date of the change. Retroactive increases in wages do not require prior notification.
An employer can deduct wages from a paycheck only under certain circumstances, such as:
Travel to and from work is not typically compensable work but travel from the employer’s office to a job site, for example, usually is but may be paid at a different rate than the employee’s regular wages (so long as it is not less than minimum wage).
All wages and tips must be paid on the regular payday, which may be daily, weekly, bi-weekly, semi-monthly, or monthly. Bonuses and commissions may be paid as infrequently as annually, if prescribed in advance.
Former employees are entitled to all wages due on or before the next regular pay day either through regular channels or via the mail, if requested by the employee. Bonuses or commissions must be paid on the first regular payday after the amount becomes calculable and cannot be forfeited unless the employer gives the employee the proper notification required by law regarding the employer’s policy or practice which results in forfeiture.
If there is a dispute as to how much is owed, the employer is still required to pay the undisputed amount on the next regular payday. An employer cannot condition payment of the undisputed portion of wages upon an agreement by the employee to release his or her claim for the remaining balance. Instead, the employee may still sue to recover any amount he or she believes is still owed.
A successful former employee will be entitled to recover the amount of unpaid wages plus interest at the legal rate (eight percent (8%) per year) from the date each amount first came due. The former employee will also be entitled to recover liquidated damages equal to the amount of unpaid wages (i.e., a total recovery of twice the amount of wages owed) unless the employer can show its failure to pay wages was based upon the good faith belief that its conduct did not violate the law. The court may also award the former employee costs of the action as well as attorneys’ fees.
Two years from the date the wages became due.