Author Archives: Jon Rehm

Are You Kidding Me? Jimmy John’s Makes Sandwich Makers Sign Non-Compete Agreements

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I thought I was reading “The Onion” when I read that Jimmy John’s was forcing lowly paid sandwich makers in Illinois to sign non-compete agreements. Unfortunately, this is true, and that is tragic for Jimmy John’s employees and employees everywhere.

If there is a silver lining to this dark cloud for employees, it is that these agreements are generally not enforceable. My reading of Nebraska law leads me to believe that a non-compete agreement for a sandwich maker would not be enforceable. In Nebraska, non-compete agreements are only enforceable if 1) they are not injurious to the public and 2) protect some legitimate interest of the employer and 3) are not unduly harsh and oppressive upon the employee. Obviously these non-competes are unduly oppressive and harsh to employees, but they likely also do not protect a legitimate interest of Jimmy John’s. Employers can be protected from unfair, but not ordinary, competition. What unfair competitive advantage can an $8-per-hour sandwich maker give to another sandwich-making shop? Nebraska has struck down non-compete agreements for much more highly paid workers, like sales professionals whose livelihood depends on building relationships with customers. I cannot see how any court could equate a sandwich maker making the minimum wage with a highly-compensated software or farm-products salesperson.

But such legal reasoning is cold comfort for a low-wage worker who is stuck with one of these agreements. Such treatment of Jimmy John’s and fast-food workers in general explains efforts to unionize Jimmy John’s workers and other fast-food workers. If you are a food worker who receives one of these non-compete agreements, I would be happy to consult with you. I would also encourage you to visit jimmyjohsnworkers.org and/or fightfor15.org.

Also remember that an election is 12 days away in Nebraska, Iowa, and most of the rest of the country. Please get out and vote, and vote for candidates who support employee rights.

Did a Local Manufacturer Violate Federal Law with a Sudden Layoff?

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Employees at the Store Kraft plant in Beatrice, Neb., were stunned to find out on Monday morning that Monday would be their last day on the job. Such short notice may be against federal law and entitle the laid-off workers to back pay and benefits for up to 60 days.

Under the WARN Act (Worker Adjustment and Retraining Notification Act), employers of more than 100 employees are required, in most instances, to give workers 60 days of notice in the event of a plant closing or a mass layoff.

Press coverage of the plant closing appears to show that Store Kraft is roughly at 100 employees. If Store Kraft had more than 100 employees, then it is very possible that their former employees may have a case under the WARN Act. The closing of the Store Kraft factory is devastating for its workers and hurtful to Beatrice and the surrounding community, but former workers may have a claim against Store Kraft for the abrupt manner in which the employer shut down the plant.

Are You Really an Independent Contractor?

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“Calling a dog’s tail a leg does not make it a leg.” Abraham Lincoln

FedEx drivers recently won two class-action lawsuits in the 9th Circuit Court of Appeals. The court ruled that FedEx wrongfully withheld overtime pay, Social Security, unemployment, Medicare and other benefits to drivers because they were misclassified as independent contractors rather than employees. The decisions were driven by the fact that FedEx exercised control over the appearance of drivers as well as what packages to deliver, on what days, and at what times.

Though the FedEx decision only applies to Oregon and California, it is very possible that a similar decision would have been made under Nebraska law. Under the Nebraska Wage Payment and Collection Act as well as under the Employment Security Law, Neb. Rev. Stat. 48-601 et al., there is a five-part test as to whether a worker is an independent contractor or employee.

  1. Individual is free from control or direction under contract of hire
  2. Individual is free from control or direction as a matter of fact
  3. Service is outside the usual course of business for which service is performed
  4. Such service is performed outside of all the places of business of the enterprise which such service is performed
  5. Individual is customarily engaged in an independently established trade, business or profession.

Nebraska law creates a presumption of an employer-employee relationship. Tracy v. Tracy, 581 N.W. 2d 96, 7 Neb. App. 143 (Neb. Court of Appeals, 1998) In short, if you can answer most of those questions “no,” you are very likely an employee rather than an independent contractor. The mere fact that you may have signed a documents stating you are independent contractor does not necessarily mean you are an independent contractor.

In addition to protections under federal law, asking questions about your employment status is also a protected activity under Nebraska law. Being misclassified as an independent contractor could cost you thousands of dollars in wages and benefits. However, you have the ability to fight back if you are being misclassified.

How Employers Can Abuse FMLA

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Our colleague, Tom Domer in Milwaukee, recently criticized the media for their misleading coverage of “FMLA abuse” among public employees in Milwaukee. This criticism parallels our criticism about misleading coverage of an unemployment decision in Iowa. Domer pointed out correctly that FMLA leave is unpaid. The fact that FMLA leave is unpaid leave makes it possible for employers to abuse FMLA.

I represented a client with a personal health condition that temporarily prevented that person from doing heavy lifting. My client told human resources about this health condition, and that person was forced to take unpaid FMLA leave. Of course, under the Americans with Disabilities Act, there is an obligation to engage in an interactive process to determine what reasonable accommodations could be made so the disabled employee can perform the essential functions of the job. In the case of my client, there was evidence that that person’s employer did not engage in that process. Though my client’s case ultimately resolved, I doubt that my client is the only person who has had a similar experience with forced FMLA.

I suspect some employers use unpaid FMLA leave as a way to reduce payroll expenses even if an employee could perform the essential functions of their job with a few simple accommodations. So the next time you hear about employees abusing FMLA, remember that employers can abuse unpaid leave as well.

Don’t Believe the Hype About Employment Law

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“Don’t Believe the Hype” when it comes to employment law.

This admonition was spurred by a misleading article and headline that I was e-mailed by Watchdog.org recently. The article was meant to spur outrage that a teacher who was alleged to have been drunk on the job but was allowed to get unemployment benefits in Iowa.

To Watchdog.org’s credit, they did include a copy of the actual decision. Just like in Nebraska, Iowa puts the burden of proof on an employer to prove wrongful termination. The district in exurban Des Moines never sent a representative to the hearing. The school district did not follow Iowa law in testing the teacher for drugs and alcohol. Neb. Rev. Stat. 1901-1910 lays out similar requirements under Nebraska law. Few people point out that if this teacher was such a bad employee, then maybe the school district could have spent a few hours proving their case or that they should have followed clear rules about drug and alcohol testing.

But of course, most people never get beyond the headline or the sound bite. The goal is to gin up outrage among “just regular folks” about people “milking the system” in order to get them to elect officials who will promote “personal responsibility” and “accountability.” Responsibility and accountability never seem to apply to management the same way they apply to employees.

Ginning up outrage about drunken teachers distracts from the war against workers and their allies in Nebraska and in Iowa and across the country. Fortunately, places like Iowa and Nebraska still have decent laws for employees and also have advocates who are willing and able to stand up for those laws. Regular folks in Iowa need to look at who is really trying to harm their interests on the job, and act accordingly in November. The same goes for those of us on the western bank of the Missouri River. This fall, Iowans and Nebraskans need to look beneath the carefully constructed, “regular guy” images of Terry Branstad and Pete Ricketts, and find out where they really stand, and vote accordingly.

Discrimination: Municipal Human-Rights Commissions Another Option for Charges

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When a prospective client calls in with a potential employment discrimination question, one of the questions I always ask is, “What city or town do you work in?” The reason I ask this question is because many larger cities in the states where we practice, such as Omaha, Lincoln and Des Moines, have separate municipal fair-employment acts that cover more employees than are covered under state or federal law.

State and federal fair-employment statutes generally need at least 15 or 20 employees for an employer to be covered by those laws. However, in Des Moines and Lincoln, an employer only needs to have four employees to be covered under those cities’ human-rights ordinances. In Omaha, an employer only needs six employees to be covered by their fair-employment ordinance.

Also, the City of Omaha explicitly covers sexual orientation under the fair-employment ordinance. Sexual-orientation discrimination is not explicitly prohibited by Nebraska or federal law. It is my belief that sexual-orientation discrimination is a form of sex discrimination that is already covered under Title VII and the Nebraska Fair Employment Practices Act. However, my opinions as to what I think the law is and what the law is are two different matters. If you are an Omaha resident who feels you were discriminated against because of your sexual orientation, you would be much more certain to have your claim of discrimination heard on the merits by pursuing a claim under the Omaha Human Rights Ordinance. While I would be willing to filing a sexual-orientation discrimination case under Nebraska law, any potential clients need to know that such a case would be a test case, and as such, this case would be under tremendous scrutiny from judges.

The drawback to filing discrimination cases under the Lincoln and Omaha municipal ordinances is that there is less opportunity for monetary award if you are successful in winning your case than you would have under state or federal law. However, some remedy for your discrimination is better than no remedy for your discrimination.

Can I Get Fired For Filing Bankruptcy?

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Low and middle income people are the last people to benefit from any economic recovery. For many economic recovery means a return to work the opportunity to put their household finances in order with steady income provided by a job. Unfortunately unpaid debts often mean that employees get garnished  or even having to file bankruptcy.

Congress intended for bankruptcy to allow for people to get a fresh start so they prohibited discrimination based on bankruptcy and even let employees sue employers for such discrimination. But this law is not as strong as other laws prohibiting discrimination on factors such as race or sex for two reasons.

First of all, your status as a debtor in bankruptcy must by the sole cause of job loss. Discrimination is difficult enough to prove already under either a motivating factor or proximate cause standardsole cause is more exacting than even the difficult proximate cause standard. If your employer has any other legitimate reason to fire you besides your bankruptcy, then a court will likely find the termination was lawful. The only way for an employee to preserve any type of discrimination case is not to give the employee a reason to terminate them because of their poor performance , attendance or poor attitude. But even good employees can get fired legitimate reasons such as restructuring and economic reasons.

Secondly most courts do not believe that bankruptcy discrimination prohibits employers from failing to hire employees based on bankruptcy.

Title VII and most state anti-discrimination laws state that a failure to hire based on certain protected categories is unlawful activity.

Finally in any discrimination claim, the employer needs to be aware of your protected status. In a bankruptcy discrimination case this means that your employer had to have known about your bankruptcy status prior to firing you. Some employees get fired because  employer doesn’t want to deal with a garnishment.  Most people, me included, think that such an action is wrong or unfair. But unless your employer knows that garnishment is linked to your bankruptcy status, then firing you based on that garnishment is legal  — unless the garnishment is a cover or pre-text for another unlawful reason.

I would encourage anyone reading this post to contact their U.S. Senator or Congressperson and ask them to change the bankruptcy discrimination statute to mirror other federal anti-discrimination laws such as Title VII.

Do I Have a Wrongful Termination Claim?

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wrongful termination claimAssuming you do not have an employment contract, you can only claim wrongful termination if the firing was motivated by certain unlawful reasons. Unlawful reasons include discrimination based on sex or gender – this includes sexual harassment and pregnancy – as well as race, religion, nationality and disability. In certain places and in certain situations, sexual orientation discrimination can also be unlawful. Disability in this context will often mean any serious or chronic health condition you have. Disability discrimination can also mean that you are taking care of someone with a disability.

You also cannot be discriminated against by your employer for certain activities on the job. This is commonly referred to as retaliation. One of these activities is taking extended leave under the Family and Medical Leave Act (FMLA) for your own or for a loved one’s medical condition. Other common protected activities include opposing unlawful discrimination; filing a safety complaint; filing a workers’ compensation complaint; complaining of pay practices; or complaining about other illegal activities. If you are a government employee, you might also have some claims based on constitutional law.

Essentially, not all terminations are unlawful. But if your situation fits into the categories described above, then be sure to contact an experienced employment attorney. In addition, it is wise to ask for advice about applying for unemployment, even if there’s not a wrongful termination case.