Fourth Circuit Sets Joint Employment Test

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In a wage and over-time pay lawsuit filed under state and federal law, the Fourth Circuit Court of Appeals set forth its own test for “joint employer” relationships under the Fair Labor Standards Act. The issue was whether two persons or companies constitute joint employers for FLSA purposes.

The court stated that joint employment exists when (1) two or more persons or entities share, agree to allocate responsibility for, or otherwise codetermine essential terms and conditions of worker’s employment and (2) the two entities’ combined influence over the essential terms and conditions of the worker’s employment render the worker an employee as opposed to an independent contractor. The court set out six (6) distinct factors to examine and meeting only one of those factors can support a finding of a joint employer relationship.

Salinas v. Commercial Interiors, Inc. has broad implications for the wage and overtime responsibilities of employers located within the Fourth Circuit, which has jurisdiction over appeals from federal courts located in Maryland, Virginia, North Carolina, South Carolina, and West Virginia.

In another case decided the same day using the new test, the Fourth Circuit applied the test it announced in Salinas to find that satellite television installation technicians were jointly employed by both DirecTV and the subcontractor that employed them initially, so the technicians could bring wage and hour claims against both DirecTV and the contractor.

For help with employment law questions or other civil litigation issues, call Tracy Stroud, Attorney with Colombo Kitchin Attorneys in Greenville, NC, at 252-321-2020.

Computer Fraud and Abuse Act and Employment

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In a case filed in Eastern District of North Carolina alleging a claim under the federal Computer Fraud and Abuse Act (CFAA), (Sageworks, Inc. v. Creatore) the district court found that the employee accessed information belonging to the employer without authorization and exceeded his authorized access to obtain information.

Cases under CFAA can be brought in federal or state court. An employer can sue employee when the employee accesses and uses information without authorization. This law is commonly being used to file a lawsuit against an employee when the employee takes employer information and goes to work for a competitor.

For help with employment law questions or other civil litigation issues, call Tracy Stroud, Attorney with Colombo Kitchin Attorneys in Greenville, NC, at 252-321-2020.

Paid Leave as Reasonable Accommodation in NC

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The EEOC has published guidance that providing paid maternity-only leave related to mother’s recovery does not violate Title VII. But does the policy raise the possibility of paid leave as a reasonable accommodation for a qualified individual with a disability?

By linking the leave to the mother’s recovery, the leave is based on a physical impairment. If paid maternity leave is linked to a disability, then employers may not be able to deny similar paid leave as a reasonable accommodation to other qualified individuals with a disability. Nothing in the ADA allows employers to favor one type of disability over another by providing better accommodation or benefits. Employer’s attorneys need to be mindful when advising clients on paid maternity leave policies.

If you have questions about North Carolina employment law, please contact Tracy Stroud at Colombo Kitchin Attorneys at 252-321-2020.

NC Choice of Law and Forum in Business Contracts

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The North Carolina General Assembly has decided to legislate choice of law in commercial transactions.  It will be codified at N.C. Gen. Stat. §1G-1. The statute only applies to business contracts. The definition in the statute excludes consumer contracts and employment contracts. The statute says is when it becomes law and applies to business contracts entered into before, on, or after that date.

The benefit of this statute is that that parties they can choose North Carolina law to govern their contracts and they can select North Carolina as a forum to resolve their disputes. Before the statute was enacted an opposing party could attack choice of law in court by saying that the dispute did not have a “reasonable relation” to North Carolina or application of our law would violate a “fundamental policy” of the state whose law would apply in the absence of the choice of law provision.

Now, those attacks are not allowed under the statute. If the parties to a business contract agree that North Carolina law will govern their relationship, it may not be attached on reasonable relation or fundamental policy grounds.

The new law also allows parties to a contract to choose whether they want disputes litigated in North Carolina. Before, parties could attack forum clauses on the basis of substantial hardship or unequal bargaining power.

Finally, the new law also gives parties to business contracts the ability to select a specific North Carolina county in the contract as the place where any lawsuit relating to the contract must be filed.

For help with employment law questions or other civil litigation issues, call Tracy Stroud, Attorney with Colombo Kitchin Attorneys in Greenville, NC, at 252-321-2020.