Both the federal Fair Labor Standards Act (“FLSA”) and the New York Labor Law (“NYLL”) set requirements for employers to follow including paying employees the minimum wage and overtime pay.

In 2010, seeking to provide workers with additional protection, former New York Governor Patterson signed the Wage Theft Prevention Act (the WTPA) into law which allows for the imposition of tougher penalties for wage theft violations.

For example, the WTPA increased the total amount of money that an employee could potentially recover for willful violations of the state’s wage and hour laws. This is referred to as liquidated damages. This term simply refers to an additional monetary award that an employee may be able to recover under the WTPA in addition to the unpaid wages award.

In fact, the changes allow an employee to recover double the amount of what he or she is owed by the employer. However, an employee can only recover liquidated damages if the employer violated the law in bad faith.

On April 6, 2018, in the case of Rana v. Islam, the Second Circuit Court of Appeals issued an employee friendly decision relating to wage theft. Rana filed a federal lawsuit alleging numerous violations of state and federal labor and human trafficking laws. In his lawsuit, Rana alleged that he was enslaved at the hands of former New York consul general of Bangladesh, Monirul Islam and his wife.

According to Rana, Islam and his wife successfully lured him into coming to the United States by falsely promising him “good working conditions” as a domestic worker in their Manhattan home, all while earning $3,000 monthly.

However, soon after arriving in the U.S., Rana learned that these promises were a far cry from the truth. Instead, Rana suffered eighteen months of horrific abuse and deplorable work conditions. For instance, according to the court’s decision, Rana was forced to work 16 to 20 hour days, seven days a week for 18 months without any compensation. Any attempt to ask for his wages or leave the apartment was followed by death threats and physical abuse. During this time Rana was also allegedly forced to sleep on the kitchen floor or in a storage room and was only allowed to eat expired or leftover food.

Based on the seriousness of these and other facts, the lower district court awarded Rana $922,597.31 in damages. This number included liquidated damages under both the NYLL for $114,577.64 and the FLSA for $66,062. Facing substantial penalties, Islam appealed the court’s damages order to New York’s highest federal court – the Second Circuit Court of Appeals.

Prior to the Rana decision, New York courts often disagreed about whether or not a successful plaintiff could recover liquidated damages under both the FLSA and NYLL for the same action. On appeal, the Second Circuit pointed this out.

In an attempt to clarify this unsettled area of the law while at the same time making it clear that the court was not agreeing with Islam’s factual challenges to the award, the Second Circuit held that double recovery was not permitted. However, the court decided that successful plaintiffs could recover the larger award.

Accordingly, the Second Circuit concluded that Rana was entitled to the NYLL award in the amount of $144,677.64, in addition to other types of damages he had been awarded, but not the $66,062.00 that the FLSA allowed in liquidated damages.

The Rana decision should serve as a wake-up call for New York’s employers and as a reminder that the Department of Labor, as well as New York courts, continue to take wage theft seriously.

The Long Island employment lawyers at Famighetti & Weinick PLLC are experienced in handling wage theft lawsuits in New York, including claims of unpaid wages or unpaid overtime. If you have any questions about the FLSA, the NYLL, or any damages that you may be entitled to for an employer failing to properly pay you, contact a Long Island employment lawyer at 631-352-0050 to schedule a free consultation.

Today’s Long Island employment law blog was written by Law Clerk Thalia Olaya.

One point that is different between the FLSA and the NYLL is the list of employees who are exempt from the overtime requirement. Being exempt means that the employee is not entitled to receive overtime pay. For example, employees who work at car dealerships as service advisors are one of the types of employees who are exempt from the federal overtime pay requirement, but not from the New York State law requirement.

Some employment agreements may also prevent an employer from simply turning their back to overtime pay requirements and may nevertheless require them to pay an employee overtime even if they are not required to do so under either the FLSA or NYLL.

On April 2, 2018, the United States Supreme Court, in Encino Motorcars, LLC v. Navarro, was confronted with an FLSA related question.

In Encino Motorcars, LLC v. Navarro, five employees who worked as service advisors at a Mercedes-Bens dealership in California, had sued the dealership in 2012 for failure to pay them overtime despite working, at a minimum ,55 hours every week. The service advisors, in addition to working directly with customers to sell them car repair services, also acted as the liaison between the customers who decided to service their car and the repair technicians working in the garage.

The district court and the Ninth Circuit Court of Appeals disagreed on whether or not the employees were entitled to overtime pay. The United States Supreme Court, after accepting to hear the case and originally kicking the case back down to give the Ninth Circuit another chance to decide the case, ultimately ruled in favor of the car dealership.

To decide to the case, the Supreme Court looked at the language of the FLSA which exempts “any salesman, partsman, or mechanic primarily engaged in selling or servicing automobiles.” The majority of the judges decided that there was no doubt that service advisors are “salesm[e]n . . . primarily engaged in . . . servicing automobiles.” Therefore, the Court said the real question was whether service advisors are “salesm[e]n primarily engaged in . . . servicing automobiles.” However, the Court was not troubled much by this question.

While the Court acknowledged that service advisors didn’t “spend most of their time physically repairing automobiles,” they pointed to the broad range of tasks that service advisors perform and stated that they are “integral to the servicing process.” The Court also pointed out that partsmen, who are explicitly exempted from the FLSA, also do not “spend most of their time physically repairing automobiles.” Thus, the Court concluded that Congress intended to include at least some workers who didn’t physically repair cars and notably stated that “[i]f you ask the average customer who services his car, the primary, and perhaps only, person he is likely to identify is his car service advisor.”

Further, in rejecting the Ninth Circuit’s narrow reading of the FLSA, the Court noted that the statute clearly showed that a broader interpretation was intended by Congress because of the statute’s use of language such as “any” and“or.”

In sum, although the Supreme Court’s decision did not change anything for employees in New York, it is still important for employers and employees to understand the differences between the FLSA and the NYLL. Due to the several exemptions that exist and the differences between the federal FLSA and the NYLL, it may not always be clear whether a certain employee is entitled to reap the benefits of the law’s overtime pay requirements.

If you are wondering whether your employer is required to pay you overtime under either federal or state law, or if you have any other employment related questions, contact an employment lawyer at Famighetti&Weinick, PLLC at 631-352-0050 to schedule a free consultation. You can also contact us by visiting our website at at https://www.linycemploymentlaw.com or by finding us on Facebook. Se habla español!

Today’s Long Island employment law blog was written by Thalia Olaya, a Hofstra Law School intern.

Employers like to include arbitration clauses because the arbitration process is generally a quicker and cheaper alternative to a proceeding in court. Yet, a worker recently disagreed with a court’s decision requiring that he use arbitration instead of filing his Fair Labor Standards Act (“FLSA”) claim in court.

On December 12, 2017, the Second Circuit Court of Appeals was asked to decide whether claims under unpaid wage and overtime claims underthe FLSA are in fact subject to arbitration.

The FLSA and the New York Labor Law (“NYLL”) requires that most employees earn, at least, the minimum wage and receive overtime pay for all hours worked over 40 in a workweek. Overtime pay is one and one half times the regular rate of pay.

In Rodriguez-Depena v. Parts Authority, Inc., Rodriguez filed a lawsuit against his employer alleging that he was denied overtime pay in violation of the FLSA. His employment contract contained a provision requiring arbitration of any job-related dispute .Notably, Rodriguez’s employment contract was an individual one and not a collective bargaining agreement (“CBA”), meaning a contract negotiated by a union.

The district court compelled arbitration of the FLSA claim and Rodriguez appealed to the Second Circuit Court of Appeals, New York’s highest Federal appellate court, after disagreeing with the district court’s order.

On appeal, Rodriguez made several arguments. Among those arguments, Rodriguez argued that the United States Supreme Court had determined, in a previous case, that an employee could sue in a district court for an alleged FLSA violation. The employee in that case, however, was asserting rights based on a CBA. Therefore, the Supreme Court made it clear that collective rights under a CBA are different from individual contract rights under the FLSA.

Rodriguez also made an argument based on a recent Second Circuit decision – Cheeks v. Freeport Pancake House, Inc., which required court approval of FLSA claim settlements. He argued that if he settled his claim, the Cheeks case required the settlement to be approved by the court. Therefore, Rodriguez argued, this requirement prohibited arbitration of FLSA claims.

The Second Circuit was not impressed by any of his arguments. Specifically regarding the Cheeks case argument, the Second Circuit stated that the court approval requirement was to ensure the fairness of FLSA settlements and not to “guarantee” a “judicial forum.”

In sum, employees should be aware of the terms of their employment contract before signing one. If an employee is not careful, he or she could be agreeing to provisions which give up important legal rights. Importantly, employees who currently have arbitration provisions in their employment contracts, will likely be forced to arbitrate instead of litigate their FLSA claims.

The Long Island employment law firm Famighetti & Weinick, PLLC is available to review employment contracts and we are experienced in negotiating the terms of employment contracts. Also, if you have questions about arbitration of FLSA claims or the minimum wage and overtime pay requirements under the FLSA or the NYLL, contact a Long Island employment lawyer at Famighetti & Weinick at 631-352-0050. Our website is https://www.linycemploymentlaw.com.

Today’s Long Island employment law blog was written by Hofstra Law school intern, Thalia Olaya.

Who is Entitled to Overtime Pay in New York?

Only employees may be entitled to overtime pay. In other words, independent contractors are not employees and are, therefore, not entitled to overtime pay. Employers, however, frequently misclassify workers as independent contractors. Simply paying an employee “on a 1099” is not the end of the inquiry as to whether a worker is an independent contractor. As a matter of fact, being paid on a 1099 is probably the least important factor. Rather, courts will look at the level of control that the employer has over the worker, the worker’s ability to set work hours and pay, who supplies the tools and equipment, and the permanency of the work. The more control it appears that the employer has over the worker, the more likely it is that the worker is an employee and not an independent contractor.

Once it is determined that the worker is an employee, the FLSA and NYLL separate employees into two categories — exempt and non-exempt. Exempt employees must meet a series of legal tests to determine whether they are exempt from the overtime requirements. If the employee does not meet the tests, the employee is non-exempt and must be paid overtime. The test for whether an employee is exempt is (1) is the employee paid the minimum salary set by the Department of Labor; (2) is the employee paid a salary and not hourly; and (3) are the employee’s primary job responsibilities those that that are considered. The last requirement means that the employee’s job responsibilities must be executive, administrative, or professional. Courts will look at the employee’s actual job responsibilities, not just the title. For example, simply calling an employee an administrative assistant does not mean that the employee meets the administrative job duties test. The court will look at the employee’s day to day responsibilities to determine whether the administrative exemption applies.

What to do if an Employee Has Not Been Paid Overtime

Frequently, employers try to call workers independent contractors so they don’t have to pay overtime and minimum wage. If the workers are not truly independent contractors, the employer will find itself in danger of a wage and hour lawsuit and/or penalties from the Department of Labor. Not only are the wage and hour laws implicated, but these employers have not paid workers compensation and unemployment insurance for the misclassified employees and may face stiff penalties and fines from the Department of Labor.

Workers who have been misclassified or who were just not paid overtime by their employer may bring a wage and hour lawsuit against the employer in New York. Waiters, waitresses, busboys, cooks, landscapers, and construction workers are frequently taken advantage of by employers who do not pay their employees properly. Because employers usually pay all of their employees the same way, wage and hour lawsuits can typically be brought as class or collective actions, meaning all the “similarly situated employees” can be a part of the lawsuit. Employees can obtain actual damages for the overtime owed by the employer, liquidated damages if the conduct was willful, and interest. Further, employers may be required to the attorneys fees for the employee’s lawyer who brought the wage and hour lawsuit in New York.

Wage and Hour Lawyers in New York

Famighetti & Weinick PLLC are employment lawyers on Long Island. Famighetti & Weinick handle wage and hour lawsuits in New York, including cases involving unpaid minimum wage and unpaid overtime. The employment lawyers can be contacted at (631) 352-0050 or on the internet at https://www.linycemploymentlaw.com.