Lockaby PLLCLockaby PLLC2024-02-21T12:38:42Zhttps://www.lockabylaw.com/feed/atom/WordPress/wp-content/uploads/sites/1101614/2022/05/cropped-site-icon-32x32.pngOn Behalf of Lockaby PLLChttps://www.lockabylaw.com/?p=511222023-12-18T06:15:08Z2023-12-18T06:15:08ZMuldrow v. City of St. Louis. The plaintiff was a sergeant with the St. Louis Police Department who worked in the intelligence division, investigating public corruption and human trafficking cases. The plaintiff’s position with the intelligence division gave her the ability to earn up to $17,500 in overtime pay because she worked on an FBI task force. The position afforded the plaintiff various other benefits, such as generally working a nine-to-five schedule and the ability to wear plain clothes. Eventually, the plaintiff was involuntarily transferred to the city’s Fifth District, where she supervised police officers on patrol, reviewed and approved arrests, and worked crimes such as homicides, robberies, and assaults. In this latter position, the plaintiff was ineligible for overtime and was forced to wear a uniform.
After the city denied her request to transfer from the Fifth District, the plaintiff sued the city alleging gender discrimination and retaliation. She alleged that the city discriminated against her by involuntarily transferring her from her position in the intelligence division, claiming that her supervisor wanted a man in the position.
Both the federal district court and the U.S. Circuit Court of Appeals for the 8th Circuit ruled in favor of the city and dismissed her suit. Both courts reasoned that the plaintiff failed to prove that her transfer amounted to an “adverse employment action” that caused material harm.
Title VII of the Civil Rights Act of 1996 prohibits discrimination on the basis of sex. To prevail under Title VII, plaintiffs alleging discrimination must establish they suffered an adverse employment action. Traditional examples of an adverse employment action include being fired, suspended, demoted, or receiving less pay or benefits. In addition, many federal circuits require plaintiffs to establish that the alleged discriminatory conduct subjected them to a “significant disadvantage” in order to prevail.
In Muldrow, the court of appeals found that the plaintiff failed to establish a significant injury or harm. "To be materially adverse, retaliation cannot be trivial. It must produce some injury or harm," the court noted. Simply being denied a transfer would not rise to this requirement.
The Supreme Court granted the plaintiff’s petition for certiorari. The Supreme Court is not determining whether the plaintiff was discriminated against due to her sex; rather, the Court is set to determine whether an involuntary transfer alone constitutes an adverse employment action under Title VII. Should the Court rule in favor of the plaintiff, this would significantly increase the number of cases that plaintiffs could bring against employers under Title VII, as it would negate the “significant disadvantage” requirement and otherwise up-end years of case law on what constitutes an adverse employment action.
Regardless of the outcome, employers should diligently document their decision-making process with respect to transfers and other major employment decisions. Doing so will assist employers in defending against claims premised upon a transfer. This will become especially important if the Court removes the “significant disadvantage” requirement that many courts have recognized for Title VII claims.
Do you have questions about how to establish best practices with respect to documenting employment decisions such as transfers? Is your business being accused of discriminatory conduct? Do you need insight to ensure your business is protected from legal exposure related to transfers or other significant employment decisions? Let’s connect.]]>On Behalf of Lockaby PLLChttps://www.lockabylaw.com/?p=511192023-11-15T21:17:21Z2023-11-15T21:04:40ZOufafa v. Taxi, LLC, a taxi driver was shot by a passenger and suffered permanent paralysis. After the incident, the driver filed a claim for workers’ compensation benefits, but the taxi company denied the claim on the basis that the driver was an independent contractor and not an employee.
In the workers’ compensation proceeding, the administrative law judge (“ALJ”) affirmed the company’s denial of benefits, ruling that the driver was an independent contractor. The ALJ’s decision was reversed by the Workers Compensation Board (“the Board”), which found the driver to be an employee, which was later reversed by the Kentucky Court of Appeals, which held that the driver was an independent contractor.
After reviewing the case’s history and the various and sometimes conflicting factors in determining whether an individual is an employee or independent contractor, the Supreme Court of Kentucky reversed the Court of Appeals and remanded for further review. The Supreme Court determined that a new test was necessary to determine if an individual is an employee or an independent contractor for workers’ compensation cases. Id. at 599-600.
Following its holding in Mouanda v. Jani-King Int'l, in which the Supreme Court adopted the “economic realities” test for wage-and-hour disputes arising under the Kentucky Wages & Hours Act, the Supreme Court likewise adopted the “economic realities” test for determining if an individual is an employee or independent contractor for workers’ compensation cases.
Under the “economic realities” test, which is currently employed by the federal courts when construing wage-and-hour protections under the Fair Labor Standards Act, the Kentucky courts will consider six factors when determining whether a worker is an employee or independent contractor:
The permanency of the relationship between the parties;
The degree of skill required for the rendering of the services;
The worker’s investment in equipment or materials for the task;
The worker’s opportunity for profit or loss, depending upon his skill;
The degree of the alleged employer’s right to control the manner in which the work is performed; and
Whether the service rendered is an integral part of the alleged employer’s business.
Prior to Oufafa, the Kentucky courts utilized a four-factor test to resolve disputes over worker classification. Noting the various difficulties in applying this former test, the Supreme Court announced that the “economic realities” test was the better and more efficient method “to discern the actuality of the working relationship.”
While there is significant commonality between the “economic realities” test and the prior standard, the “economic realities” test removes one of the prior factors, the intention of the parties. In addition, the Supreme Court noted that the central inquiry under the “economic realities” test is “the worker's economic dependence upon the business for which he is laboring.” Ultimately, by removing the intent of the parties and by emphasizing a worker’s economic dependence on a business, the Supreme Court has signaled that this trend toward use of the “economic realities” test won’t be limited to wage-and-hour and workers’ compensation matters. Indeed, the Supreme Court stressed that it “did not limit itself when it recently adopted the economic realities test” and that the employee/independent contractor designation determines an individual’s entitlement “to many statutory employment protections.” If the Supreme Court continues to expand the use of the “economic realities” test, likely targets include statutory protections related to unemployment insurance benefits, occupational safety and health protections, and anti-discrimination and anti-retaliations protections under the Kentucky Civil Rights Act, among others.
Do you have questions regarding how the “economic realities” test will impact your organization’s current designations of employees and independent contractors? Do you need actionable insight to ensure your business is protected from legal exposure related to employee and contractor classifications? Let’s connect.]]>On Behalf of Lockaby PLLChttps://www.lockabylaw.com/?p=511172023-11-09T05:22:54Z2023-11-09T05:22:54ZNew Rule
Under the new Rule, “two or more employers of the same particular employees are joint employers of those employees if the employers share or codetermine those matters governing employees’ essential terms and conditions of employment.” See 29 C.F.R. §103.40(b). An employer “share[s] or codetermine[s] . . . essential terms and conditions of employment” if it has the authority to control, directly or indirectly, an employee’s essential terms and conditions of employment. Id.
There are seven categories of terms and conditions that will trigger application of the Rule, which include:
Wages, benefits, and other compensation;
Hours of work and scheduling;
The assignment of duties to be performed;
The supervision of the performance of duties;
Work rules and directions governing the manner, means, and methods of the performance of duties and the grounds for discipline;
The tenure of employment, including hiring and discharge; and
Working conditions related to the safety and health of employees.
See 29 C.F.R. §103.40(d).
According to the Board, simply possessing the authority to control the essential terms and conditions of employment is sufficient to be considered a joint employer, regardless of whether such control is ever exercised. Likewise, merely possessing the power to indirectly control only one of the essential terms of employment is enough to establish joint employment, even when that power is not exercised directly.
The Board did not carve out any exceptions or narrow its application to preclude sectors and industries that rely upon indirect methods of employment. Therefore, entities like franchisors, staffing agencies, building and construction companies, and other similarly situated employers are likely to be impacted by the new Rule. Perhaps anticipating concerns by the aforementioned organizations, the Board noted that it was “mindful that applying the final rule will require sensitivity to industry-specific norms and practices” and that it would “take any relevant industry-specific context into consideration when considering whether an entity is a joint employer.” See 88 F.R. 73986.
Prior Rules
The NLRB’s definition of joint employment has changed significantly in recent years, often changing in conjunction with the political control of the Board. In 2015, the Board issued a decision in Browning-Ferris Industries of California, Inc., 362 NRLB 1599 (2015), which held that, like the new Rule, multiple organizations were joint employers based solely on the right of joint control. Prior to Browning-Ferris, joint employment required proof of actual control over essential employment terms and the level of control needed to be direct and immediate.
In 2020, following litigation and political changes to the Board, a subsequent rule was issued pursuant to which joint-employer status only existed when one company exercised substantial direct and immediate control over the essential terms and conditions of another organization’s employees. The new Rule, of course, significantly expands this former rule and returns to a Browning-Ferris version of joint employment.
Implications for Employers
The implications for employers found to be joint employers are significant. If deemed to be a joint employer, the employer can be held liable for unfair labor practices committed by the co-employer, such as the failure to pay minimum or overtime wages. The new Rule also requires a joint employer to collectively bargain with a union workforce.
Given these substantial implications, employers should assess their relationships with subcontractors, vendors, staffing agencies, and any other organization that could fall within the definition of joint employment. Modification of contractual terms should be considered to explicitly state that a business does not have the right to control any of the seven essential terms of conditions listed in the rule.
Next Steps
The new Rule will not go into effect until December 26, 2023. In the meantime, is highly likely that the new Rule will be challenged on multiple fronts. Sen. Bill Cassidy of Louisiana and Sen. Joe Manchin of West Virginia have already announced that they will introduce a resolution under the Congressional Review Act to overturn the Rule. The U.S. Chamber of Commerce has indicated that it is examining potential litigation to challenge the new Rule.
Lockaby PLLC will continue to monitor the status of the new Rule and any legal challenges and provide updates to employers on how best to navigate this new regulatory framework.]]>On Behalf of Lockaby PLLChttps://www.lockabylaw.com/?p=506132023-02-17T22:04:28Z2023-02-23T13:03:10ZThree options
The first and less ideal option is to do nothing. A failure to put together a plan means state law will guide the transfer of the real estate. The legal term for this is to pass the property intestate, basically meaning that no plan was put into place to guide the transfer of the estate. This is less ideal because it takes away the ability to control the transfer, and the owner loses the chance to reduce tax obligations.
The next option is to include the property in a will. This provides the owner with control as they can dictate which beneficiary or beneficiaries receive this asset. Although the owner now has control the property will likely still transfer through the probate process. This is often public and can mean the details of your estate are now in the public domain.
The final option is to transfer the asset into a trust. Use of a trust can avoid the asset going through probate saving time and maintaining your privacy. Depending on how the trust is structured, it can also mean that your estate saves on tax obligations.
Tailor a plan to the estate
No two estates are the same. It is important to draft a plan with your specific estate in mind to better ensure the plan meets your expectations. You can help to better ensure a successful plan by seeking a legal team that will listen to your goals and help tailor a plan to reflect your wishes.]]>On Behalf of Lockaby PLLChttps://www.lockabylaw.com/?p=506102023-02-17T22:02:50Z2023-02-21T13:01:34Z
Reduce the estate’s federal estate tax
Reduce any inheritance tax to beneficiaries
The federal estate tax can apply to the transfer an estate. As noted within the name, this is a federal tax. The federal government does not currently tax one’s inheritance — but some states do.
What is the federal estate tax?
This tax rate varies and is currently set to apply to transfers to heirs during one’s life or death above $12.92 million in 2023. The tax on transfers of estates above this rate can range from 18% to 40%.
Those with an estate over this limit can reduce their estate to lower their tax obligations. An estate can achieve this goal in several ways including charitable donations and gifts. Estates can also transfer assets into a trust to hold the property. This means, for tax purposes, the property is no longer part of your taxable estate. Instead, the trust owns the property. The trust is viewed as a separate, taxable entity.
Does Kentucky have an inheritance tax?
Kentucky state law allows for an inheritance tax. The amount varies depending on factors like how the beneficiary was related to the owner of the estate and the amount of estate transferred. Transfers to a spouse are generally exempt.
It is important to note that trusts are very nuanced legal tools. Taxing authorities will look for ways to get around this legal structure and tax the estate. It is wise for those who seek to establish a trust to help build wealth seek legal counsel experienced with this niche area of estate planning law to better ensure it survives a challenge from taxing authorities like the Internal Revenue Service (IRS).]]>On Behalf of Lockaby PLLChttps://www.lockabylaw.com/?p=506052023-02-17T21:58:29Z2023-02-08T22:34:27ZThe PWFA covers a perceived gap in existing law. The Pregnancy Discrimination Act prohibits discrimination against pregnant workers but doesn’t specifically require accommodations. At the same time, it is not clear the Americans With Disabilities Act, which does require reasonable accommodations for disability, covers pregnancy. The PWFA makes clear that pregnant workers are entitled to reasonable accommodations from covered employers.
The new law requires employers covered by the law to:
Make reasonable accommodations for the known limitations of pregnancy, childbirth, and related medical conditions. An accommodation is considered reasonable if it would not impose “undue hardship” on the operation of the business
Determine reasonable accommodations for each employee through an interactive process
Additionally, it forbids employers from:
Denying employment opportunities to a qualified employee because they would need reasonable accommodations for pregnancy, childbirth or a related medical condition
Requiring the pregnant worker to take leave (even paid leave) if another reasonable accommodation can be provided
Taking any adverse action against the employee on account of their having requested reasonable accommodations related to pregnancy, childbirth, or a related medical condition
Are we covered by the PWFA?
If your company is covered by other federal civil rights laws, you can expect to be covered by the PFWA. Specifically, you are a covered employer if are a private-sector company with 15 or more employees, or if you are any state or federal employer. The law covers pregnant employees who would be able to perform the necessary functions of the job if given accommodations.
What kinds of accommodations are needed?
The accommodations necessary for pregnancy, childbirth, and related conditions will be individual, as the PWFA requires you to engage in an interactive process. However, common accommodations include:
Exceptions from certain policies, such as those requiring people to stand during working hours or which don’t allow them to drink water throughout the day
Temporary changes in duties, such as not requiring certain hazardous or strenuous activities during pregnancy and for a reasonable period of time after birth
More frequent breaks to allow the worker to access medication or simply to rest
Schedule changes to accommodate more frequent medical appointments
A lawyer can help you make a plan to comply with the PWFA.]]>On Behalf of Lockaby PLLChttps://www.lockabylaw.com/?p=506022023-02-01T14:57:21Z2023-02-01T14:56:54Zoverview of the Kentucky Living Will Directive Act, the primary law in the Commonwealth governing living wills, a type of advance directive.
As we explained, a comprehensive estate plan includes not only careful planning for the disposition of property and money, but also thoughtful, considered instructions for medical providers and loved ones should the person become medically incapacitated and no longer able to make and communicate their healthcare decisions.
Basic provisions
The Act provides Kentuckians a living will form in which an adult – called the grantor – can:
Name a health care surrogate, including co-surrogates and successor surrogates, authorized to make treatment decisions if the grantor loses their decisional capacity in the future
Direct their surrogate and doctors in treatment decisions concerning providing, refusing, or ending life-sustaining medical treatments such as mechanical ventilators or kidney dialysis
Instruct the surrogate and physicians whether and under what circumstances to provide artificial nutrition or hydration through a feeding tube or IV
Designate whether to donate their organs
Before executing the form, it is smart to discuss these decisions with a doctor so that the grantor understands the range of treatment options as well as their pros and cons. A medical specialist can provide more specific information should the grantor face complexity due to an existing health problem.
The MOST form
The Act also directs the Kentucky Board of Medical Licensure (KBML), a state agency, to create a “medical order for scope of treatment” form (MOST form). The MOST form is normally used for a patient with advanced illness or frailty, usually in advanced years, to dictate decisions in their particular medical circumstances. The grantor should work closely with their treating doctor to make informed decisions should certain treatment decisions arise.
For example, the form has options for directing decisions such as:
If the patient has no pulse and is not breathing, should medical professionals attempt cardiopulmonary resuscitation (CPR)?
What level of medical intervention does the grantor want if a pulse is present or they are still breathing (full scope including life support, hospitalization, and intensive care; limited additional intervention including hospitalization avoiding intensive care, but no ventilation or intubation; or comfort measures only)?
What level of antibiotic treatment is desired and for what purpose?
Does the patient want IV fluids or medically administered nutrition and if so, long term or short?
Normally, a patient who still has decisional capacity initiates the MOST form, but if they have lost the ability to make and communicate medical decisions, other parties may be authorized to complete and sign it, such as a named surrogate, a guardian, and certain others.
The patient (or their health care surrogate or responsible party), the healthcare professional preparing the form, and the patient’s doctor must all sign. When properly executed, the form becomes a physician’s order for treatment and is portable to other health care settings.
If a MOST form conflicts with the person’s living will, the living will governs.
Takeaway
The living will and MOST form under the Act are legally and medically complicated, requiring the most serious kinds of personal decisions about life and death. In addition to close collaboration with treating medical professionals, consultation with an experienced estate planning attorney allows a Kentuckian to understand the range of related legal issues and thereby make informed decisions.]]>On Behalf of Lockaby PLLChttps://www.lockabylaw.com/?p=505982023-02-01T14:58:31Z2023-01-30T20:09:38Zessential planning: the living will, a document that sets forth instructions for making healthcare decisions when a person is no longer able to make the decision for themselves.
Many people have strong feelings about their wishes, others have given this issue no thought at all. The decisions evidenced in and instructions set forth in a living will are difficult issues related to life and death, and they require significant reflection and discussions. In addition, while these issues normally present at the end of life, they can arise at any age during unexpected illness or following accidental injury, so it is wise to think about who you would consider naming as your healthcare surrogate (or surrogates, including backup surrogates) to make decisions for you. What instructions do you want to leave about providing, withholding, or terminating life support procedures, such as the use of ventilators or mechanically administered hydration or nutrition, when you cannot make the decision for yourself?
Kentucky Living Will Directive Act
Since 1994, the primary state law applicable in these circumstances is the Kentucky Living Will Directive Act, which includes a living will form. With a living will, a person at least 18-years-old (the “grantor”) designates a healthcare surrogate to make medical decisions on their behalf in case the grantor loses “decisional capacity,” defined as the “ability to make and communicate a health care decision.”
One of a variety of “advance directives,” a living will can also include the grantor’s instructions about:
Whether to provide or refuse treatment that would prolong life
Whether to give or withhold nutrition or hydration through a feeding tube
Whether to donate the grantor’s organs
Seek legal counsel
An experienced Kentucky estate planning attorney can answer questions about the Act and its options. A lawyer can assist with the official form or provide advice about whether to revise it or draft another. They can also explain what happens under state law if no validly executed living will exists for a person who loses decision making capacity.
In part 2 of this series, we’ll further discuss the Kentucky Living Will Directive Act, including its provision for a related document called the medical order for scope of treatment (MOST form).]]>On Behalf of Lockaby PLLChttps://www.lockabylaw.com/?p=505902023-01-27T17:11:22Z2023-01-27T17:11:22Zpart 1 of this post, we provided an overview of prohibited employer retaliation against employees for their engagement in certain activities protected by state and federal employment laws.
Illegal retaliation or reprisals occur when an employer takes materially adverse action against an employee because the worker engaged in work-related protected activities, including:
Reporting to management or human resources a reasonable, good faith belief of unlawful activity in the workplace like discrimination, harassment, unpaid wages, and others
Filing or pursuing a workers’ compensation claim
Cooperating in a government investigation into a co-worker’s claim of illegal treatment at work
Filing a lawsuit against the employer
Requesting or taking leave from work for which the employee is eligible, such as under the federal Family and Medical Leave Act (FMLA)
Requesting lactation breaks allowed by state and federal laws or complaining about noncompliance with legal requirements for breastfeeding in the workplace, such as a clean, private space that is not a bathroom
Requesting job accommodations for religious practices or disabilities
Refusing to follow an order at work that would cause the employee to do something illegal
Discussing salary, wages, or other working conditions with coworkers
But what if there is a valid reason for materially adverse action against the employee?
Retaliation claims are often factually complex, but despite an employee engaging in protected activity, an employer can “discipline or terminate [a] [worker] if motivated by non-retaliatory and non-discriminatory reasons that would otherwise result in such consequences,” according to the U.S. Equal Employment Opportunity Commission (EEOC). In other words, an underperforming employee who sees “the writing on the wall” cannot insulate themselves from an adverse employment action simply because they complained about an illegal practice or reported discrimination or harassment.
Because so much is at stake—not least the costs associated with defending a lawsuit, the opportunity costs associated with management’s time devoted to the lawsuit rather than their essential duties, and a potential hit to employee morale—a Kentucky employer should engage experienced legal counsel straightaway for guidance to preempt potentially complicated situations that could result in charges of retaliation.
Retaining a knowledgeable employment attorney early on can help an employer lower the chances of retaliation charges by articulating expectations to management and creating a safe atmosphere for people to speak up. After all, an employer needs to know if illegal or unethical activity may be happening so it can investigate.
The lawyer can help the employer establish written anti-retaliation policies and procedures as well as set up ongoing anti-retaliation training for management, HR, and non-supervisory employees. A lawyer can provide guidance and representation to the employer about how to respond in a nonretaliatory way when they receive an informal or formal report of a violation of law in the workplace or find themselves defending an employee’s retaliation claim before a government agency or in court.]]>On Behalf of Lockaby PLLChttps://www.lockabylaw.com/?p=505882023-01-27T17:12:45Z2023-01-25T15:47:26ZEmployers should proceed with caution
Continuing a trend, retaliation claims accounted for more than half of employee discrimination charges filed with the U.S. Equal Employment Opportunity Commission (EEOC) in 2021. While some of these charges were likely unfounded, these numbers are a bellwether for the number of disgruntled workers in the workplace.
Anatomy of a retaliation claim
The classic retaliation scenario is that, after an employee reports something illegal or negative to the employer or otherwise asserts their employment rights, the employer takes unlawful adverse employment action against them. While many may think of wrongful discharge as the usual adverse action, negative employer actions cover a broad range of prohibited conduct.
The U.S. Department of Labor defines an adverse action as one that “would dissuade a reasonable employee from raising a concern about a possible violation or engaging in other related protected activity … [and] … can have a negative impact on overall employee morale.” In other words, retaliation may be designed to provide a warning to other employees to keep their complaints to themselves.
For example, in addition to wrongful termination, an adverse action could also include a demotion, a transfer to a less desirable position or shift, a decision not to promote the employee, undeserved or unwarranted disciplinary action, and a negative or unfair performance evaluation. In other words, while some instances of retaliation or overt, others forms of retaliation are much more subtle.
In part 2 of this post, we will share information about retaliation, protected actions, and the need for attorney guidance.]]>