Delaware Employment Law Blog

Employees' Blackberry usage may prompt lawsuits. Claims for unpaid overtime wages have swept the country and put the nation's biggest employers on high alert as the class-action craze shows no signs of slowing.

The rapid growth of the PDA and Blackberry usage among employees may hit employers in the pocket book more than they think. These devices used to be just for lawyers, doctors, and executives. But, in today's techno climate, even rank-and-file employees are using PDAs.

A great deal of this usage occurs after hours and on weekends. Is the time spent by an employee when checking and responding to e-mails and messages is compensable under the Fair Labor Standards Act (FLSA) and state wage laws.

The general rule is that non-exempt employees must be paid for all hours worked. The standard used to determine whether time is actually "hours worked" is whether the employee is "suffered or permitted to work." An non-exempt employee who receives a company-provided PDA and uses it to respond or send work-related e-mails my have an argument that he or she should be paid for that time.

While some employers may balk at the notion of paying an employee for time responding to a few e-mails after hours, all of the time spent texting away may add up. Generally, an employee can claim up to two, and in many cases three, years of back overtime or wages. In addition, the FLSA provides a fairly easy mechanism to bring a class action lawsuit for overtime on behalf of similarly situated employees.

So far, there have been no wage-and-hour suits involving PDAs, but employers would be wise to review their policies regarding use of PDAs by non-exempt personnel. In particular, non-exempt employees should be instructed to report any work time spent using PDAs. And employers may even want to place limitations on when PDAs can be used after hours.

The Wall Street Journal Law Blog has a great post on this topic, "Are Blackberrys the Next Battleground in Wage-and-Hour Litigation"

Overtime lawsuits are the hottest employment lawsuit trend.  Nevada lawyer Mark R. Thierman is a demigod in this corner of the legal world.  Thierman has won hundreds of millions of dollars from companies in unpaid wages.   Beginning in the mid-1990's, Thierman filed the first in a series of lawsuits against California employer after having spent most of his career as a management-side employment attorney. 

The federal Fair Labor Standards Act (FLSA) requires the payment of overtime and minimum wage for most workers. About 115 million employees—86% of the workforce—are covered by federal overtime rules, according to the U.S. Department of Labor (DOL). Plenty of wage and hour lawsuits are filed on behalf of the traditional working class, be they truckers, construction laborers, poultry processors, or restaurant workers. In fact, some would say that wage and hour suits have generated a cottage industry for plaintiffs' lawyers.  But no one has been more successful than Thierman in collecting overtime for employees who are far from the factory floor or fast-food kitchen.

His biggest settlements over the last two years have been on behalf of stockbrokers, many of whom earn well into the six figures. Thierman has teamed up with other lawyers to extract settlements totaling about a half-billion dollars from brokerage firms, including $98 million from Citigroup's Smith Barney and $87 million from UBS Financial Services Inc. (As is typical in settlements, the companies do not admit liability.) With those cases drawing to a close, he and other attorneys already are pursuing new claims on behalf of computer workers, pharmaceutical sales reps, and accounting firm staff.

BusinessWeek.com has a great article titled, "Wage Wars," detailing Thierman's Robin-Hood style ventures and the wave of overtime litigation sweeping major corporations across the country.  Since 2000, overtime litigation has exploded nationwide. The U.S. Chamber of Commerce decried the "FLSA litigation explosion" and its having become the "claim du jour" for plaintiffs' attorneys.

Thierman shrugs at such concerns. The alternative, in his view, would be to have the laws enforced by a government bureaucracy.  Thierman professes to be helping the little guy: "I'm interested in the middle class—those are my folks."

[H/T to George's Employment Blawg and the Ohio Employment Law Blog]

Delaware has been ranked first among all fifty states in the quality and fairness of its litigation environment, according to an annual study titled "Lawsuit Climate" published by the U.S. Chamber of Commerce's Institute for Legal Reform. Delaware has been awarded this honor for six straight years.

The survey polled approximately 1000 corporate attorneys at the nation's largest employers and took into consideration factors such as judge competence and impartiality, jury fairness, quality of attorneys, and timeliness for trial. Along with Delaware, Nebraska, Maine, Indiana and Utah were ranked in the top-five. Rounding out the bottom five were Louisiana, Mississippi, Alabama, Illinois and West Virginia.

Recession seems imminent, leading to layoffs and downturn in business. But the looming recession also means more activity in other areas. Employment360 cites experts who believe the current recession will increase the amount of intellectual property legal work, including enforcement of noncompetition and nondisclosure agreements. The view is that companies are more likely to pursue former employees who violate their noncompete and confidentiality agreements during economic downturns as companies increase efforts to protect their assets.

For employers, now is the time to be reviewing what measures you need to institute to protect their business interests. Key employees should have enforceable noncompete and confidentiality agreements in place to prevent them from posing a threat should they leave employment. To better ensure enforcement of the agreements, multi-state employers also should include a requirement that the case be litigated in a state that enforces these types of agreements. Some states such as California will not enforce noncompete agreements, while other states such as Georgia, Texas and Illinois are reluctant to uphold the agreements in their entirety. Delaware continues to be a favorite forum for enforcement of noncompete and confidentiality agreements because of its business friendly environment and accessibility to the courts.

Employers also must implement proper screening measures to make certain that new hires are not subject to noncompete agreements that will ensnare them in trade secret litigation. All applicants should be asked whether they had confidentiality or noncompete agreements with their former employer so that preventative steps can be taken before they commence employment.

In this month's edition of the American Bar Association's pulication, the ABA Journal, is an article titled "New Troubles for Teens at Work." The article reviews recent cases that seem to indicate the courts' narrowing definition of what constitutes acceptable workplace behavior.

Restaurants, which tend to be a much more casual workplace enviornment, have been the source of a large percentage of teen harassment claims. In a recent decision by the federal appellate court for the Seventh Circuit, EEOC v. V&J Foods, employers were warned that they will not be excused from liability by the mere fact that they have a policy and reporting mechanism in place. Instead, the court warned the business community that, when it comes to teen harassment, the bar has been raised.

The latest headlines of the local newspaper, the News Journal underscore what is becoming the latest trend in employment lawsuits: military service discrimination.

On Wednesday, March 26, an Army lieutenant colonel serving in in Baghdad filed a federal lawsuit alleging he was fired from the Delaware State Police in violation of state and federal laws that protect military reservists from discrimination and retaliation because of their military service.

45-year-old Lt. Col. Keith W. Janowski claims that he encountered harassment, discrimination and retaliation because of his duties and obligations "as a citizen-soldier in the U.S. Army Reserve" during his 16 years on the state police force. He also alleges that after his return from active duty in 2003, he asked for retraining in civilian searches but was denied. He was fired in 2005 for conducting a improper search and exercising poor judgment, allegedly because he missed a pack of cigarettes during a search of a person.

This lawsuit supports the national statistics that more and more military personnel are excercising their rights under the Uniformed Services Employment and Reemployment Rights Act (USERRA). As those employees return from active duty, employers face extensive and often confusing obligations imposed under USERRA. The law was enacted in 1994 to encourage civilian military service by attempting to eliminate the disadvantages employees face when called into service. The law governs employer's responsibilities to employees during periods of military leave and upon return to employment.

Unlike many employment laws, USERRA applies to all employers, public and private, regardless of size. It requires you to grant unpaid leaves of absence for employees called into military service. Employees may elect to use accrued vacation pay, annual leave, or other accrued paid leave during military leave, but you may not require them to use it during that time. Upon returning from military service, USERRA grants eligible employees the right to reemployment.

Eligibility for Reemployment

Eligibility for reemployment under USERRA requires employees to meet the following criteria:

1. Notice. Employees must provide employers with advance notice of their military service obligation. The notice may be verbal or written and may be provided by a military officer. Many employers request that employees provide copies of induction documents, training notices, or other military orders. The advance notice requirement is waived if military necessity makes advance notice impossible or unreasonable.

2. Exclusions. Reemployment rights are available for absences of up to five years of cumulative military service. Many of the most common categories of military service for employees don't count toward that five-year limitation period. For example, military service during a time of war or national emergency is exempt from the five-year period. President Bush declared a state of national emergency following the September 11, 2001, attacks and authorized mobilization of military troops.

3. More Exclusions. Military service in support of Operation Iraqi Freedom and Operation Enduring Freedom isn't counted toward USERRA's limitation period. Another exception you must be familiar with is the annual and weekend training required for National Guard members and reservists.

4. Disqualifying Discharges. Reemployment rights under USERRA don't extend to an individual with a disqualifying discharge from military service. A disqualifying service discharge means (1) a separation from service with a dishonorable or bad-conduct discharge, (2) a separation from service under "other than honorable" conditions, (3) dismissal of a commissioned officer by court martial or presidential order, and (4) a "dropped from the rolls" separation caused by an absence without authority or civil imprisonment.

5. Reapplication Period. To maintain reemployment rights, an employee must report to work or apply for reemployment within a specific period of time determined by the length of military service. A written application for reemployment is unnecessary; an employee is required to inform his employer that the period of military service has been fulfilled. If the military leave is less than 31 days, the employee must return to work eight hours after returning home from completion of military service at the beginning of the first full regularly scheduled work period. For military leaves of absence between 31 and 180 days, the employee must submit an application to the employer within 14 days following the completion of military service. For leaves in excess of 180 days, the employee must apply for reemployment within 90 days of completing military service.

6. Inability to Return to Work. USERRA extends those time limits for up to two years if an employee is unable to return to work because of a service-related illness or injury. Any employee failing to report to work or reapply for employment within the appropriate time frames is subject to the employer's policies regarding any unexcused absence from work.

Employer duties to reemploy

At the conclusion of military service, an employee is generally entitled to reemployment to the position she would have held or attained but for the period of military service. In that respect, USERRA is contrary to the concept of employment "at will" and affects your personnel decisions during the period of active military service. Not surprisingly, failure to reinstate a former employee following a period of military service is one of the most common complaints under USERRA.

Employees serving less than 91 days of military service must be reemployed in a position they would have attained but for the period of military service, provided they're qualified for the position. If an employee isn't qualified for the position after you have made reasonable efforts to qualify her, you must return her to the position held before military service.

Employees absent for military service longer than 90 days must be reemployed in the position they would have attained or in a position of comparable seniority, status, and pay, provided they're qualified to perform the job. If a returning employee isn't qualified for the position, you must make reasonable efforts to qualify her for the position. If those efforts fail, you must return her to the position held before military service or a position of comparable seniority, status, and pay.

If you're reemploying an employee with a disability incurred or aggravated during military service, you must make additional efforts. First, you must make reasonable efforts to accommodate the employee's disability so she may become qualified for the position she would have attained if continuously employed. If she isn't qualified despite your reasonable accommodation efforts, she must be placed in a position of equivalent seniority, status, and pay as long as she's qualified for the position or can become qualified for the position through your reasonable efforts. Last, if the employee doesn't qualify for the equivalent position, she must be employed in a position that "most nearly approximates" the equivalent position in seniority, status, and pay.

Exceptions to reemployment rights

There are limited exceptions to the obligation to reemploy employees returning from military service. Reemployment isn't required when doing so would be impossible or unreasonable, such as when a reduction in force during the leave period has eliminated the employee's position.

Discharge protections

Once reemployed, USERRA affords returning servicemen and servicewomen protection from discharge without cause. The extent of that protection is based on the length of military service. Individuals reemployed after 181 days or more of military leave may not be fired without cause for a period of one year after reemployment. Individuals reemployed after 30 to 180 days of military service may not be fired without cause for six months after reemployment. There's no protection against discharge without cause for individuals serving less than 30 days.

Discrimination and retaliation protections

USERRA prohibits you from discriminating against persons with past or present military obligations when making decisions relating to hiring, promotion, reemployment, termination, and employment benefits. You're prohibited from retaliating against individuals who file complaints or exercise any right under USERRA.

Employee benefits

Under USERRA, employees on military leave are entitled to the same benefits provided to employees on other leaves of absence. For example, if you provide employees on Family and Medical Leave Act leave with continued health, life, or disability insurance or allow employees to continue to accrue vacation benefits, employees on military leave must be afforded the same benefits.

The commencement of military leave is a COBRA-qualifying event, and continued health insurance coverage is available to employees at their expense. On December 10, 2004, President Bush signed the VBIA into law, which expanded the continuation period for military families from 18 months to 24 months. The extended continuation period is effective for continuation elections made on or after December 10, 2004. If you haven't already done so, you should revise your health plan administration to reflect the extended continuation period available for employees entering military service.

Retirement/pension benefits

USERRA contains expanded pension rights for eligible employees. Periods of military service may not be treated as a break in service for an employer-sponsored pension plan. For vesting and accrual purposes, the military service period is considered service with an employer. You're required to make any pension contributions for employees returning from military service you would have made if they hadn't been on military leave.

If you sponsor a "contributory" plan that offers benefits only when the employee makes contributions, returning employees must be given three times the military service period, not to exceed five years, to make up any missed contributions. You're obligated to make matching contributions consistent with the amount contributed by the employee.

VBIA: notice of USERRA rights and duties

In addition to extending the health insurance continuation period from 18 to 24 months, the VBIA also requires you to notify present and returning employees of "the rights, benefits, and obligations of such persons and such employers" under USERRA. The notice requirement became effective on March 10, 2005, and can be met by posting a notice in the location other workplace notices are customarily hung. The U.S. Department of Labor's Veterans Employment and Training Service (VETS) has created a poster that contains the notices required under the VBIA. A color copy of the poster, suitable for printing, is available at no charge on the department's website.

USERRA technical assistance also is available from VETS, which can be accessed by calling (866) 4-USA-DOL or by visiting its website. at An interactive USERRA advisor is available online here.