Insights Archives — Page 5 of 47 — Lindabury, McCormick, Estabrook & Cooper, P.C. Firm News & Events

Terminated Employee Who Tested Positive for Marijuana After a Workplace Driving Accident Can Pursue His Wrongful Termination Claim

Published on: May 3, 2023 | by Kathleen M. Connelly

A recent decision from the New Jersey District Court illustrates the extraordinary job protections for recreational marijuana users under the New Jersey Cannabis Regulatory, Enforcement Assistance, and Marketplace Modernization Act (“CREAMMA”).

THE LEGAL BACKDROP

The job protection provisions of CREAMMA prohibit employers from disciplining employees “solely due to the presence of cannabinoid metabolites in the employee’s body fluid.” Although CREAMMA expressly permits workplace reasonable suspicion, post-accident and random testing for marijuana, it also mandates a physical evaluation be conducted “by an individual with the necessary certification” to determine the employee’s current state of impairment before discipline can be imposed. The physical evaluation requirement was included because current tests can only determine recent marijuana use, not current impairment. However, the physical evaluation requirement was temporarily waived by regulation until such time that the NJ Regulatory Cannabis Commission (the “Cannabis Commission”) develops standards for a Workplace Impairment Recognition Expert (“WIRE”) certification. Thus, for the time being a physical evaluation is not a prerequisite for taking action against an employee who tests positive for cannabis.

New Jersey Court Ruling: Private Social Media Posts Are Subject To Discovery

Published on: March 23, 2023 | by Lindabury, McCormick, Estabrook & Cooper, P.C.

On March 16, 2022, the New Jersey Appellate Division concluded in Davis v. Disability Rights of New Jersey that a plaintiff-employee’s privacy interests in her social medial posts and personal cell phone bills did not restrict her employer’s right to the production of these records when defending against claims that the plaintiff’s termination violated New Jersey’s Law Against Discrimination (the “NJLAD”) and caused her to suffer emotional distress. This decision is the first in New Jersey to detail the scope of discovery regarding a litigant’s private social media posts.

The Background

In Davis, the plaintiff filed a NJLAD complaint against her former employer alleging wrongful termination and emotional distress. In its discovery requests, the employer demanded that the plaintiff produce copies of all her social media content “concerning any emotion, sentiment or feeling of [p]laintiff, as well as events that could reasonably be expected to evoke an emotion, sentiment, or feeling.” The employer also sought the production of the plaintiff’s personal cell phone bills on the grounds that she had used her personal cell phone to perform work duties remotely.

The United States Supreme Court Rules Highly Paid Employees May Still Be Eligible For Overtime

Published on: March 14, 2023 | by Lindabury, McCormick, Estabrook & Cooper, P.C.

On February 22, 2023, the United States Supreme Court in Helix Energy Solutions Group, Inc. v. Hewitt held that a highly compensated executive employee paid a guaranteed daily rate is not paid on a ‘salary basis’ and therefore, is a nonexempt employee entitled to overtime pay under the Fair Labor Standards Act (FLSA). The decision should alert employers to review their classification of employees as exempt versus nonexempt to ensure compliance with applicable federal and state requirements.

The Fair Labor Standards Act

While the FLSA requires that most employees be paid overtime for work time in excess of 40 hours, it exempts several categories of positions from that requirement. The most common exemptions from overtime are referred to as the “white-collar exemptions,” which include executive, administrative, professional, outside sales, IT professionals, and highly compensated executive positions.

New Jersey Passes Landmark Legislation Expanding Temporary Workers’ Rights

Published on: February 14, 2023 | by Lindabury, McCormick, Estabrook & Cooper, P.C.

On February 6, 2023, Governor Murphy signed new legislation into law significantly expanding the rights of temporary workers. The law, known as the “Temporary Workers’ Bill of Rights” (A1474/S511), is aimed at advancing pay equity, increasing government oversight of temporary staffing agencies, and prohibiting retaliatory conduct against temporary workers. A1475/S511 applies to workers in designated classifications, including protective services, food preparation, construction labor and trade, personal care services, and building, grounds cleaning, and maintenance occupations. The range of protections afforded by the new law, as outlined below, are expansive and will have significant implications on staffing agencies as well as third-party clients who utilize these agencies to place temporary workers.

New Protections

Equal Pay and Benefits

The Responsibilities and Duties of an Executor

Published on: February 6, 2023 | by James K. Estabrook and Elizabeth Candido Petite

After someone passes away, their estate must be administered. This is true whether the person was worth $10,000 or $10 million. The process of administering the estate is often the same regardless of its value. This article discusses the basic process of estate administration and the duties of the executor, who is the person or persons responsible for the process.

Appointment to act on behalf of the estate

The first step for an executor (or administrator, if there is no Will) is to be appointed by the local Surrogate’s Court as executor. In New Jersey, this is a simple process where the Will and death certificate are presented to the court, along with the names and addresses of the next-of-kin and beneficiaries named in the Will. Assuming everything is in order, the Surrogate will admit the Will to probate and issue a Certificate of Letters Testamentary to the executor, which serves as his or her official appointment to act on behalf of the estate. The executor is then responsible for notifying all heirs and beneficiaries that probate has been completed.

The Uses of Grantor Trusts in Estate Planning

Published on: February 6, 2023 | by Anne Marie Robbins

Grantor trusts can provide substantial estate and income tax savings to those who establish them. The grantor of a “grantor trust” is treated as the owner of the trust assets for federal income tax purposes. The grantor continues to pay the income tax generated by the assets contributed to the trust and receives the benefit of all deductions and credits. Whether the grantor trust property is excluded from the estate of the grantor, and thus escapes estate tax, is dependent on the drafting of the trust. The rules regarding grantor trusts can be found in Sections 671 through 679 of the Internal Revenue Code. [1]

It is beneficial for the grantor to be treated as the income tax owner of a trust because trusts have more compressed tax brackets than do individuals. For example, in 2022, individuals were taxed at the highest marginal rate of 37% on income over $539,900, or $647,850 for married taxpayers.[2] Trusts, however, reached the top marginal rate of 37% at income above $13,450.[3]

In general, the following provisions in a trust will create a “grantor trust.”

New Jersey Implements WARN Act Amendments Mandating Severance for Mass Layoffs and Business Closures

Published on: January 19, 2023 | by Kathleen M. Connelly

On January 10, 2023, Governor Murphy signed legislation implementing amendments to the Millville Dallas Airmotive Plant Job Loss Notification Act (“NJ WARN Act”) that were placed on hold during the COVID-19 pandemic. The amendments, which go into effect on April 10, 2023, impose new requirements on employers of 100 or more who implement mass layoffs or plant closures.

Background

Governor Murphy initially signed an amended NJ WARN Act on January 21, 2020, which was scheduled to take effect on July 20, 2020. However, in April 2020, the Governor signed Executive Order 103 declaring COVID-19 a public health emergency and postponing the effective date of NJ WARN Act amendments until 90 days after the conclusion of the state of emergency. Although the COVID-19 state of emergency remains in effect, the Legislature “unlinked” the amended NJ WARN Act from the state of emergency, thus permitting the implementation of the amendments to take effect on April 10, 2023.

Pay if Paid Provisions in New Jersey

Published on: January 19, 2023 | by Lindabury, McCormick, Estabrook & Cooper, P.C.

Recently, the New Jersey Appellate Division affirmed the Superior Court’s decision in Jersey Precast v. Enterprises, Inc. et al. Particularly, the December 7, 2022, decision affirmed the lower court’s finding that a “pay-if-paid” clause in a material supplier’s purchase order with a general contractor was binding and enforceable. The court in Jersey Precast, acknowledged that New Jersey has no statute or published caselaw that addresses the enforceability of “pay-if-paid” clauses. As such, the court relied upon the authorities and approaches of other jurisdictions. For example, various courts in other states require such a clause to include clear and unambiguous language in order to for a “pay-if-paid” to be enforceable. See e.g. Main Elec., Ltd. v. Printz Servs. Corp., 908 P.2d 52, 528 (Colo. 1999) (stating “…the relevant contract terms must unequivocally state that the subcontractor will be paid only if the general contract is first paid by the owner and set forth the fact that the subcontractor bears the risk of the owner’s nonpayment”); DEC Elec., Inc. v. Raphael Constr. Corp., 558 So. 2d 427, 429 (Fla. 1990) (stating risk-shifting provisions of a pay-if-paid term must be clear and unambiguous or, if ambiguous, interpreted as setting a reasonable time for payment). Moreover, at the federal level pay-if-paid clauses are typically enforceable where there is express contractual language that clearly demonstrates the intention of the parties to shift the risk of payment from the contractor to the subcontractor. See Fixture Specialists, Inc. v. Global Construction LLC, 2009 WL 90431, at *4-6 (D.N.J. March 30, 2009).

Using the above standards as guidance, the Appellate Division in Jersey Precast, critically pointed out that in New Jersey freedom of contract is a “‘is a factor of importance'” within “the framework of modern commercial life.” See Whalen v. Schoor, DePalma & Canger Grp., Inc., 305 N.J. Super. 501, 505-06 (App. Div. 1997). It is a “settled principle that parties bargaining at arm’s-length may generally contract as they wish.” Id. at 505. To that end the court held that, “parties may make contractual liability dependent upon the performance of a condition precedent.” See Duff v. Trenton Beverage Co., 4 N.J. 595, 604 (1950). The Appellate Division further articulated that a prohibition against the use of pay-if-paid provisions as conditions precedent in construction contracts should come from the legislature rather than the courts, and as such, held that as long as the contract specifies a clear and unambiguous intent and agreement by the parties to shift the risk of nonpayment, a pay-if-paid provision is enforceable subject to the parties’ implied duty to not frustrate conditions precedent to their performance.

Key Takeaways

Congress Passes the Speak Out Act Prohibiting Nondisclosure and Non-Disparagement Agreements in Sexual Harassment and Assault Cases

Published on: November 29, 2022 | by Kathleen M. Connelly

Following a unanimous vote in the Senate, on November 16, 2022, the House of Representatives passed the Speak Out Act (the “Act”) which now heads to President Biden’s desk for signature. The Act is just the latest effort by legislators at the federal and state levels to shine the light on instances of sexual assault and harassment in the workplace. This new legislation renders unenforceable certain non-disclosure and non-disparagement provisions that prevent individuals from disclosing the details of sexual harassment or assault claims that may occur in the future.

In practice, this Act will have a limited impact because its prohibitions only apply to employment or other agreements signed prior to a claim of harassment arising. Thus, the Act will not bar the inclusion of non-disparagement/nondisclosure provisions in separation agreements or settlements of sexual harassment or assault claims. In addition, the Act does not prohibit non-disclosure agreements that bar disclosure of other forms of discrimination (e.g., age, race religion) or workplace misconduct. Finally, the Act explicitly states that nothing in the new law limits employers’ prevalent use of non-disclosure and confidentiality agreements designed to protect trade secrets or critical propriety information.

Impact On New Jersey Employers:

What Divorcing Parents of Special Needs Children Need To Know

Published on: November 2, 2022 | by Nicole A. Kobis and Elizabeth Candido Petite

Divorcing parents of minor children are faced with many hard decisions that must be addressed while separating. These considerations include resolving custody, parenting time and support for their children, which are often much harder and more emotionally charged than the issues involving dividing assets and calculating financial support between spouses. When there’s a child with special needs in the family, there are additional decisions to be made surrounding their continued care, often well past the time that other children would be deemed to be emancipated, and the finances surrounding the support they’re receiving. Special needs children are best served when their parents fully address these issues during the divorce proceeding and are able to focus on the best interests of the children, and the divorcing parents are best served by attorneys who fully understand the issues and can offer practical solutions based on the specific circumstances.

Child Support

In any divorce involving children, the parties need to resolve custody, which involves both the legal and physical sharing of their children. In most cases, parties will agree or a court will order that the parties share joint legal custody of their children. Joint legal custody generally means joint decision making for all major decisions in a child’s life. These major decisions typically fall into three larger categories, which are the child’s: (1) health, (2) education, and (3) well being. For example, both parties would need to participate in the decision-making process and agree on whether the child will attend public or private school or whether the child will have their tonsils removed on a nonemergency basis. If parents are unable to agree on these decisions, they can enlist the help of attorneys, mediators or the court, who will help decide these issues with or for them. For parents of a child with special needs these decisions may involve the continuation of certain therapies or treatments or their continued care if they’re no longer able to reside at home.