Adjunct Law Prof Blog

Editor: Mitchell H. Rubinstein
New York Law School

Thursday, February 2, 2017

The End of Employees

The Wall Street Journal has a thought provoking Feb. 1, 2017 peace entitled The End of Employees. It is about how business are contracting out more and more. Why? Because it is cheaper of course. As the article states:

Steven Berkenfeld, an investment banker who has spent his career evaluating corporate strategies, says companies of all shapes and sizes are increasingly thinking like this: “Can I automate it? If not, can I outsource it? If not, can I give it to an independent contractor or freelancer?”

Hiring an employee is a last resort, Mr. Berkenfeld adds, and “very few jobs make it through that obstacle course.”

Visitors arriving at SAP, based in Walldorf, Germany, likely don’t notice that about 30 receptionists at its U.S. facilities work for contractor Eurest Services, part of Compass Group PLC. It happened in 2014 after SAP executives concluded during a review of potential outsourcing opportunities that some managers were paying their receptionists above-market wages.

SAP handed over hiring, training and oversight of receptionists to an outside firm. They were told they could leave SAP or keep their jobs through Eurest, which pays the receptionists in line with the overall market.

This is of course, nothing new. There is a ton of law concerning the issue of who is an employee which myself and others have written about. This article focuses on cost, but employers also contract out to avoid potential liability as an  employer under our labor and employment laws. This article also leaves out one important fact. While many of the contracted out employees may not be employees of the firm, they may, under certain circumstances become employees of the contractor.

Mitchell H. Rubinstein


February 2, 2017 in Employers, Employment Law | Permalink | Comments (0)

Friday, June 21, 2013

Recent Wage Act Decisions by the Massachusetts Courts

The Massachusetts Supreme Judicial Court and an Appeals Court recently issued two separate decisions interpreting certain aspects of the Massachusetts Wage Act, which allows employees to seek relief against their employer and certain officers of the employer for nonpayment of wages.  

In first decision, Cook v. Patient Edu, LLC (decision here), the SJC held that managers of LLCs can be held liable individually for unpaid wages under the Wage Act. Specifically, a “manager who 'controls, directs, and participates to a substantial degree in formulating and determining' the financial policy of a business entity may be a 'person having employees in his service' under G.L. c. 149, § 148, and thus may be subject to liability for violations of the Wage Act,” [citations omitted].

The issue before the Court was whether the legislative intent was to include managers of LLCs in the group of possible violators of the Wage Act, and the Court found that it did. The Court found a clear legislative intent to hold all individuals who contribute to a business's fiscal and employment policies responsible for how employees are treated.

In second decision, Dow v. Casale (decision here), a Massachusetts Appeals Court held that an employee’s private right of action under the  Wage Act did apply in the case of a traveling salesman who rarely set foot in Mass. This choice of law case basically states that where the Commonwealth has a close connection to the employment relationship of the parties, local law should be applied to the claim.

In this case the plaintiff worked as a salesperson for a Delaware corporation that had its a sole place of business in Massachusetts.  He resided in Florida and conducted most of his sales activity across the country. When the company closed its doors, it terminated his employment with significant commissions outstanding.  The question here was whether Massachusetts law would apply given that the plaintiff rarely visited the state.

The Court found that the nature of the plaintiff's work was such that only Massachusetts was tied to it. Factors examined by the Court include the governing law provisions in the plaintiff's employment agreement, the contact address used on the plaintiff's business cards, the location from which paychecks were issued, how often he traveled to the head office in Mass, and that he worked out of the same cubicle (albeit unassigned to him) when he was onsite.  

While distinguishing a case cited by the defendant where the Wage Act was not applied to an Australian employee operating outside the United States, importantly, the Court did acknowledge that the application of the Wage Act may be different in the case on a non-US employee.


Dimitry Herman

Adjunct Law Professor

New England School of Law


June 21, 2013 in Employers, Employment Law | Permalink | Comments (0)

Wednesday, October 28, 2009

Difficulty Older Workers Have In Finding Employment

65 and Up is another great New York Times article by Steven Greenhouse dated Oct. 23, 2009. I bring it to your attention because it reminds us just how difficult it is for older workers to find work. Now, because many seniors saw their 401(k)'s decrease in value, many more seniors are seeking work but cannot find it. As the article states:

Less well known, though, is that nearly half a million workers 65 and older want to work but cannot find a job — more than five times the level early this decade and this group’s highest unemployment level since the Great Depression.

The situation is made more dire because of numerous recent trends: many people over 65 have lost their jobs as seniority protections have weakened, and like most other Americans, a higher percentage of them took on debt than in previous generations.

The expectation once was to pay off your 30-year mortgage before you retired, or come close. Instead, the level of indebtedness among older Americans has risen faster than in any other age group, partly because so many obtained second mortgages to take money out of their homes.

Mitchell H. Rubinstein

October 28, 2009 in Employers, Employment Discrimination, Employment Law | Permalink | Comments (0)

Monday, September 14, 2009

2d Circuit Issue Major Decision Holding Employer Can Be Liable For Discriminatory Acts of Independent Contractors


We cover important decisions concerning both employee and employer status often on this blog. Normally, an employer is not responsible for acts of independent contractors. What if the independent contractor, however, is acting as an agent with direct or apparent authority of the employer? How can this arise? If the employer, for example, delegates an important responsibility-such as hiring-to a third party contractor who may happen to work at the same site as the employer. That was the exact situation in Halpert v. Manhattan Apartments, ___F.3d____(2d Cir. Sept. 10, 2009).

This decision is relatively short, but well reasoned and important. I expect it will wind up in employment law and employment discrimination textbooks throughout the country.

Mitchell H. Rubinstein

September 14, 2009 in Employers, Employment Discrimination, Employment Law | Permalink | Comments (0)

Sunday, October 26, 2008

Many Older People Want To Work

Money not the motive for many to work until 67 is an important Oct. 7, 2008 A.P. article reprinted on that raises many important social issues. The article states that may older Americans work past normal retirement age (nowadays 67) because they want to stay mentally active. In other words its not about the money. As the article states:

A new survey conducted by the U.S. division of Toronto-based Sun Life Financial Inc. shows nearly half of the workers in the United States expect to be working at the traditional retirement age of 67, but like Stein, most say it's not just because of money.


The random telephone survey of 1,515 workers indicated that 48 percent of workers believe they will still be working either full- or part-time at age 67. The most cited reason among them - declared by 83 percent - was to stay mentally engaged.

Mitchell H. Rubinstein

October 26, 2008 in Employers | Permalink | Comments (1) | TrackBack (0)

Wednesday, August 20, 2008

Employers Issuing Subpoenas To Future Employers

The August 11, 2008 National Law Journal ran a very important article entitled Subpoena tactic in work suits draws fire (registration required). It is about the practice of some employer defendants in employment law suits to subpoena plaintiff's new or prospective employer to find out what the plaintiff told them. The article also discusses a pending case in SDNY where this practice went on. As the article states:

In a sexual discrimination lawsuit pending against Sanofi-Aventis, a federal judge in New York ruled on July 24 that the drug maker could not issue subpoenas to the new or prospective employers of the five female plaintiffs. Bellifemine v. Sanofi-Aventis, No. 1:07-CV-02207 (S.D.N.Y.). The drug maker sought résumés, applications, benefit data, payroll records and references, among other things.

The plaintiffs claimed the subpoenas were a fishing expedition — irrelevant to their case — and an intimidation tactic designed to scare them into dropping their suit.

The judge suspended the subpoenas and ordered the drug company to use less intrusive means to gather the sought-after information. If those means aren't successful, however, the judge told the defendants they could repetition the court at a later date for the information.

'Highly oppressive practice'

"Plaintiffs' attorneys have got to wake up and realize that this is an unconscionable and highly oppressive practice that has got to stop," said David Sanford of Washington's Sanford Wittels & Heisler, who represented the plaintiff in the New York case.

Michael L. Banks in the Philadelphia office of Morgan. Lewis & Bockius, who is representing Sanofi-Aventis, said that the sought-after post-employment records are relevant to the defense. For example, he said, it's important for the defense to know what the plaintiffs told their subsequent employers about why the left their former jobs.

Other than a compelled defamation type case, I cannot see how this information is relevant to the defense. If an employee is claiming discrimination by employer A, how is what she told employer B relevant? Can someone explain that to me?? (For you management lawyers, now is your opportunity to comment).

In my judgement, this practice is intimidation and harassment plain and simple. Employer A knows that it is going to be difficult for the plaintiff employee to find a job. He also knows that the employee may have lied on his resume, but even if he did that is with respect to employer B. The employer is abusing subpoena power to try to get the employee to drop the suit. The article goes so far as stating that defendant employers are even issuing subpoenas to prospective employers. Clearly, the message is that if you continue with this law suit the defendant employer is going to hurt you. This is nothing more than blackmail.

Law review commentary is surely needed on this important issue.

Mitchell H. Rubinstein 

August 20, 2008 in Employers, Employment Law, Law Review Ideas | Permalink | Comments (0) | TrackBack (0)

Sunday, February 17, 2008

Employee Representation on Corporate Boards

Professor Bainbridge wrote an interesting  Feb. 17, 2008 posting on his Law and Business Blog entitled Employee Board Representation. This lengthly posting discusses the pros and cons of current employees serving as members of Boards of Directors. Prof. Bainbridge also cites to an earlier law review article he wrote on this subject.

My take on this is that progressive employers should welcome employee participation-whether the employees are unionized are not. Employees and employers have many of the same goals- the profitability of the company. Employees are also in the best position to know what is really going on in the company.

Mitchell H. Rubinstein

February 17, 2008 in Employers, Employment Law, Labor Law | Permalink | Comments (0) | TrackBack (0)

Wednesday, February 6, 2008

E-Mail Sent Via Employer's E-Mail System To Attorney Not Privileged

Scott v. Beth Israel Medical Center, 17 Misc.3d 934 (Sup. Ct. N.Y. Co. 2007) is an interesting and important case dealing with the novel issue of whether an employee's e-mail to his personal attorney from his work computer was privileged and/or whether e-mail the attorney sent back was protected as work product.

In a lengthly and well reasoned opinion, a New York lower court held that such e-mails were not so protected. Why? Because the employer had a policy stating that it could monitor e-mails and the employer had a no personal use policy. As the court stated:

The court rejects Dr. Scott's argument that CPLR 4548 invalidates BI's policy and holds that BI's e-mail policy is critical to the outcome here. First, Jiang is not at all persuasive. The e-mail policy in Jiang is significantly different than the policy here which prohibits personal use. A "no personal use" policy combined with a policy allowing for employer monitoring and the employee's knowledge of these two policies diminishes any expectation of confidentiality, while the policy in Jiang would not have such an effect. (See John Gergacz, Employees' Use of Employer Computers to Communicate with Their Own Attorneys and the Attorney-Client Privilege, 10 Comp L Rev & Tech J 269, 282 [2006].)

Second, CPLR 4548 does not preclude an employer from adopting a no personal use policy. Indeed, the language of the statute ("[n]o communication . . . shall lose its privileged character for the sole reason") contemplates that there may be other reasons that an electronic communication may lose its privileged character. Therefore, the court must determine whether Dr. Scott's use of BI's e-mail system to communicate{**17 Misc 3d at 940} with his attorney in violation of BI's policy renders the communication not made in confidence and thus destroys the attorney-client privilege if it ever applied.

While there is certainly some merit to this type of rationale and on some level the decision may be technically correct, I question whether this type of thinking is outdated. E-Mail has transformed the American workforce. While the employer's equipment may be used, as a practical matter employees do have an expectation of privacy. There are zones of privacy. An employee may, for example have an expectation of privacy in a locked desk, but not in an open office.

An employer no personal email policy and a handbook stating that the employer can monitor should not be enough to find a waiver of the expectation of privacy. I submit that these can be factors that courts could examine. However, courts should look to whether the employer actually has monitored the employees e-mail and whether the employee had actual notice of this fact. Quite simply E-mail is different and the law needs to play catch-up with technology.

This is an important issue that is likely to arise again and is ripe for law review commentary. A Feb. 5, 2008 New York Law Journal story about this case is available here.

Mitchell H. Rubinstein

February 6, 2008 in Employers, Employment Law, Law Review Ideas | Permalink | Comments (0) | TrackBack (0)