Download PDF
Lock It Up: Safeguard company property against trade secret theft
By Lois A. Gruhin
In today's difficult economic times, trade secret theft is becoming
more frequent, particularly in the areas of corporate information
technology, finance, accounting, sales, marketing, human resources, and
communications. Employers have found that former employees steal data by
transferring it to a CD or DVD and copy e-mail lists, employee records,
and customer information. Often, former employees then use this
information to find a new job or with their new employer.
There are a number of different methods and safeguarding
techniques employers should consider to protect their confidential
business information. Some of these include:
- Ensuring that documents and electronic data are adequately protected with locks, passwords, or other restrictions on access;
- Requiring employees to sign non-compete/non-disclosure agreements;
- Conducting exit interviews and obtaining assurance form the
exiting employee that he/she has returned all company property and
reminding the employee of any agreements he/she may have signed;
- Terminating computer access immediately after the employee leaves the company; and
- Conducting trade secret/non-compete audits regulary.
It is critical for companies to safeguard their trade secrets and
technical information. Companies must be able to maintain customer
relationships without worrying that former employees might use stolen
information to the company's detriment. Implementing proper procedures
and safeguards to protect confidential business information can help
alleviate these concerns and assure your company's viability.
Special Delivery: Workers' compensation awards must account for all jobs
By Scott Coghlan*
Recently, the Ohio Supreme Court held in
State ex rel. FedEx Ground Package Sys., Inc. v. Indus. Comm.
that a Workers' Compensation claimant is entitled to both an average
weekly wage (AWW) and full weekly wage (FWW) which includes income from a
second job, even when that second job is unrelated to the first and
when the second job pays more than the first.
In that case, Christopher Roper, injured himself while working
for FedEx. In addition to his job at FedEx, Roper worked a second job
with a pest control company and also operated another business on the
side. After his injury at FedEx, FedEx set Roper's AWW at $160.45 and
set his FWW at $250.80. FedEx derived these figures from his earnings at
FedEx without taking into account his earnings from his second job at
the pest control company.
Roper then moved the Industrial Commission of Ohio to increase
his AWW and FWW to reflect his combined earnings from FedEx and the pest
control company. The district hearing officer did so based on the
"special circumstances" provision of R.C. 4123.61, increasing his AWW
award to $417.05 and his FWW award to $457.36. The Franklin County Court
of Appeals eventually affirmed the order.
The Ohio Supreme Court similarly affirmed, holding that the AWW,
as the basis for benefit computation, "should approximate the average
amount that the claimant would have received had he continued working
after the injury as he had before the injury." The Court further stated
that, while R.C. 4123.61 refers to the "average weekly wage for the year
preceding the injury," the formula may be discarded if the AWW cannot
justly be determined by applying the formula. When this occurs, the
statute provides that the administrator for the Bureau of Workers'
Compensation "shall use such method as will enable the administrator to
do substantial justice to the claimants."
Id.
To no avail, FedEx argued that the inclusion of wages from other,
concurrent jobs would create a disincentive for claimants to return to
work. FedEx also argued that secondary wages should be excluded
entirely, or in the alternative that they be limited to situations where
the two jobs are similar in character. In response to FedEx's first
argument, the Court noted that R.C. 4123.56(A) expressly prohibits
temporary total disability payments when the employer makes work
available to the employee in a manner that is within his or her physical
capabilities, or when another employer does so. The court, in
dispensing with the second argument, noted that R.C. 4123.61 "refers to
wages earned in the year prior to injury without qualification or
exclusion." The court also noted that similar jobs can also have
disparate earnings. Thus, limiting AWW awards to jobs which are similar
in nature would not necessarily eliminate the wage differential which
could potentially exist.
FedEx also challenged the amount of the FWW the Commission
awarded to Roper. The Court also upheld this amount, giving broad
deference to the Commission's calculation relying on Joint Resolution
No. R80-7-48, issued by the Industrial Commission and Bureau of Workers'
Compensation. The resolution states that the full weekly wage equals
"the gross wages (including overtime pay) earned over the aforementioned
six week period divided by six" or "the employee's gross wages earned
for the seven days prior to the date of injury, excluding overtime pay,"
whichever is higher. The Court found that the Commission did not abuse
its discretion in using the first formula to calculate Roper's FWW
amount.
As a result of this case, employers need to understand that AWW
and FWW awards must include all of an injured worker's income from the
year prior to the injury from all employers. In addition, employers need
to offer employment within the physical capabilities of the injured
worker as soon as possible so as to minimize temporary total
compensation payments.
*Scott Coghlan, the chair of the firms'
Workers' Compensation Group, has extensive experience in all aspects of
workers' compensation law. For more information about workers'
compensation compliance, please contact Scott at 216.696.4441 or sc@zrlaw.com.
Unions Winning a Higher Percentage of Representation Elections, but the Numbers Don't Tell the Full Story
By Jon M. Dileno*
According to National Labor Relations Board ("NLRB") data, unions
won 68.5 percent of representation elections conducted by the NLRB in
2009. This is up from the prior year's 66.9 percent and represents the
highest win rate since 1955 when unions won 67.6 percent of the
elections in which they participated. The 2009 union election win-rate
represents more than a ten percent increase since 2004, although unions
have won more representation elections than they have lost in each of
the past 13 years.
While the union win-rate increased in 2009, the number of voters
eligible to participate in the elections decreased from 2008.
Additionally, the NLRB conducted 1,293 elections in 2009 as compared to
1,612 in 2008, with the number of elections in 2009 (1,293) being nearly
half the number of elections conducted in 1996 (3,300). Thus, while
unions are winning at a greater percentage, the dramatic decrease in
elections has resulted in a corresponding decrease in the actual number
of elections they are winning.
Notably, these NLRB statistics do not reflect the full extent of
organizing by labor unions. Many unions organize through check-card
recognition, neutrality agreements, and methods other than NLRB-run,
secret ballot elections. These statistics should encourage all
non-union employers to review and revise workplace policies related to
union organizing and monitor their workplaces for potential union
organizing efforts.
*Jon M. Dileno practices in all areas of
labor and employment law, with a focus on private and public sector
labor law. For more information on NLRB statistics or any other labor or
employment issue, contact Jon at 216.696.4441 or jmd@zrlaw.com.
Taking It All Off: Are employers required to pay employees for changing clothes?
By Patrick M. Watts
Recently, the Department of Labor ("DOL") issued yet another
opinion letter regarding whether changing clothes at the beginning or
end of the workday is compensable time under the Fair Labor Standards
Act ("FLSA"). The DOL also addressed whether changing clothes could be
considered a "principal activity" under the Portal to Portal Act making
compensable all employee activities that occur after the changing of
clothes at the beginning of the workday.
What are clothes?
The FLSA provides that when determining hours worked by an employee, the employer shall exclude "time spent in
changing clothes
or washing at the beginning or end of each workday which was excluded
from measured working time during the week involved by the express terms
of or by custom or practice under a bona fide collective-bargaining
agreement…" 29 U.S.C. §203(o). The DOL has issued five (5) opinion
letters over the past fifteen (15) years regarding the meaning of this
provision and the meaning of "clothes." In one opinion letter, the DOL
concluded that "clothes" did not include protective equipment such as:
mesh aprons, plastic belly guards, mesh sleeves, plastic arm guards,
wrist wraps, mesh gloves, runner gloves, polar sleeves, rubber boots,
shin guards and weight belts.
See Wage and Hour Opinion Letter,
December 3, 1997. Later, the DOL revised its view of "clothes" and
determined that "clothes" included protective gear.
See Wage and Hour Opinion Letter, FLSA 2002-2.
In its most recent opinion letter, the DOL retreated to its
previous position and now advises that "clothes" do not include
protective gear. In support, the DOL cited to the legislative history of
the law and also to current court cases which conclude that protective
gear are not clothes. In citing the legislative history, the DOL noted
that during Congressional debate on this provision an example of bakery
employees was utilized to explain the purpose of this provision. The DOL
concluded that the example of bakery employees changing "clothes" was
incompatible with meatpackers or employees changing protective gear.
Moreover, the DOL cited to three cases which concluded that, among other
things, helmets, smocks, plastic aprons, arm guards, gloves, hooks,
knife holders, sanitary and safety equipment, and protective equipment
did not constitute "clothes." As a result, the DOL advises that time
spent changing protective gear or equipment is not exempt from
compensable time based on the express terms of or by custom or practice
of a collective bargaining agreement as provided by 29 U.S.C. §203(o).
The DOL disavowed any previous opinion letter which is inconsistent with
this most recent opinion.
Can the workday start when the employee is changing clothes?
In the second part of its recent opinion letter, the DOL
addressed whether changing clothes could still constitute a "principal
activity," even if the act of changing clothes itself was not
compensable. If changing clothes is a principal activity, then walking
time and waiting time after changing clothes at the beginning of the day
(and walking and waiting time before changing clothes at the end of the
day) would constitute compensable time.
The DOL determined that changing clothes
may be a
principal activity. The DOL first noted that the language of §203
assumes that changing clothes can be a principal activity because that
section states that "time spent in changing clothes or washing
at the beginning or end of each workday…"
The DOL concluded that the language itself assumes that the changing of
clothes, while exempt from compensability in some cases, remains part
of the workday. The DOL also cited to several court cases which
addressed this issue. Many of these courts concluded that simply because
the activity was not compensable did not also mean that the activity
could not be considered the start of the workday. One court noted that
although changing clothes may not be compensable under the FLSA, "it
does not affect the fact that these activities could be the first
'integral and indispensable' act that triggers the start of the
continuous workday…" As a result, the DOL concluded that changing
clothes, even when not compensable, may still be a principal activity
which effectively starts the workday.
Notably, the DOL did not opine that changing clothes will always
be non-compensable or that changing clothes will always be a principal
activity. Employers must consider a variety of factors to answer these
questions, including whether there is a custom or practice or express
language within a collective bargaining agreement and also whether
changing clothes is an integral and indispensable act to an employees
job. If you need assistance analyzing these or any FLSA compliance
issues, please contact us.
Child's Play: U.S. Department of Labor issues final child labor regulations
By Michele L. Jakubs*
The United States Department of Labor (DOL) final regulations
concerning child labor took effect on July 19, 2010. The regulations
govern the employment of children for non-agricultural jobs. The final
regulations incorporate statutory amendments to the Fair Labor Standards
Act (FLSA) and specific recommendations made by the National Institute
for Occupational Safety and Health and give employers clear notice of
jobs that children may not perform.
The FLSA requires workers be at least 16 years old to work in
non-agricultural occupations. However, the DOL deems certain occupations
suitable for workers between 14 and 15 years old. For example, prior to
the regulations, 14- and 15-year olds could work in retail, food
service, and gasoline service establishments. With the new regulations,
permissible occupations for workers ages 14-15 now include: office and
clerical work, computer programming, writing software, tutoring, serving
as a peer counselor or teacher's assistant, singing, playing a musical
instrument, cashiering, modeling, price marking, assembling orders,
packing and shelving, bagging and carrying out customer orders, kitchen
work, and other food, beverage prep and service work. Fifteen year olds
can also work as lifeguards.
The new regulations make clear that any job not specifically
permitted for 14- and 15-year olds is prohibited. The regulations also
include a non-exhaustive list of prohibited occupations including:
manufacturing, mining, processing, working with a hoisting apparatus,
working with power-driven machinery such as lawn mowers and golf carts,
all work requiring the use of ladders or scaffolds, and occupations in
warehousing, storage, communications, public utilities or public
messenger services. Fourteen and 15-year olds also are prohibited from
door-to-door "street" sales. However, charitable or fundraising efforts,
such as selling cookies for the Girl Scouts or school fundraisers, are
exempt from this provision.
The new regulations also clarify times and maximum number of
hours 14- and 15-year olds may work. From June 1st through Labor Day,
14- and 15-year olds may work between the hours of 7 a.m. and 9 p.m.
They may work a maximum of 8 hours per day and no more than 40 hours in
one week. When school is in session, 14- and 15-year olds may work
between 7 a.m. and 7 p.m. Additionally, during the school year they may
not work more than 3 hours per day or 18 hours per week.
The new regulations also expand prohibitions for workers between
the ages of 16 and 18. The prohibited occupations for workers between
ages 16 and 18 now include: working with, tending, riding upon,
repairing, servicing or disassembling an elevator, crane, manlift, hoist
or high-lift truck; and working with chain saws, reciprocating saws,
wood chippers and abrasive cutting discs.
The regulations also increase the penalties for child labor
violations. Violators can be subject to a civil penalty between $11,000
and $50,000 for each violation and $100,000 for repeated or willful
violations. The regulations also add a new penalty for causing death or
serious injury to an employee under the age of 18. "Serious injury" is
defined as:
- Permanent loss or substantial impartment of one of the senses (sight, hearing, taste, smell, tactile sensation);
- Permanent paralysis or substantial impairment of the function
of a bodily member, organ, or mental faculty, including the loss of all
or part of an arm, leg, foot, hand, or other body party; or
- Permanent paralysis of substantial impairment that causes loss
of movement or mobility of an arm, leg, foot, hand or other body part.
In addition to the above, the regulations also include new work-study
programs for workers aged 14-15. As a result of these new regulations,
this may be a good time for employers to revisit their child labor
policies and make any necessary changes.
*Michele L. Jakubs, an OSBA Certified
Specialist in Labor and Employment Law, practices in all areas of
employment litigation and FLSA compliance. For more information about
complying with child labor laws, please contact Michele at 216.696.4441
or mlj@zrlaw.com.
Z&R Shorts
Welcome Stefanie L. Baker
Zashin & Rich Co., L.P.A. is pleased to announce the addition of Stefanie L. Baker to its Employment and Labor Group.
Stefanie's practice encompasses all areas of public and private labor and employment issues.
Stefanie earned a B.A. with honors from Miami University. She
earned her law degree (J.D.) with honors from Cleveland-Marshall College
of Law. During law school, Stefanie served as Editor-in-Chief of the
Journal of Law and Health. She was also a member of Moot Court and
completed an externship with the Honorable Christopher A. Boyko of the
Northern District of Ohio. Stefanie is admitted to practice law in the
State of Ohio. She is a member of the Ohio State Bar Association, the
Cleveland Metropolitan Bar Association, and the Cleveland-Marshall Law
Alumni Association.
Please join us in welcoming Stefanie to Z&R!
Congratulations to Patrick J. Hoban
Zashin & Rich Co., L.P.A. would like to congratulate
Patrick J. Hoban
on his recent certification by the Ohio State Bar Association as a
Specialist in Labor and Employment law. Pat fulfilled several
requirements to earn this specialty certification, including
demonstrating a substantial and continuing involvement in Labor and
Employment law. Congratulations Pat!
