In this case, plaintiffs are bringing collective action claims under the Fair Labor Standards Act (FLSA) based on the under-payment of wages and overtime at Smithfield Packing’s Tar Heel, North Carolina meat processing facility.  Magistrate Judge Gates issued an opinion last week recommending that defendant’s motion to decertify the FLSA collective action be denied.  If his recommendation is approved by the district judge, the case will proceed to trial as a collective action.  The plaintiffs are represented by several lawyers, including Ann Groninger.

Continue for details from the opinion: Read more…

Categories: Judicial Decisions, Results Tags: Ann Groninger, Case Commentary, Class Certification, Collective Action, EDNC, FLSA, Labor and Employment, North Carolina, Smithfield Packing, Unpaid Wages, Wage and Hour

A strike at the Mott’s apple juice plant in New York highlights a significant issue besides the pay for these particular workers, as noted by this New York Times article: “The union movement and many outsiders view the strike as a high-stakes confrontation between a company that wants to cut its labor costs, even as it is earning record profits, and workers who are determined to resist demands for wage and benefit givebacks.”

The parent company here, Dr Pepper Snapple Group, is not alone in making large profits even as workers earn less and less.  Our economy, however, cannot start growing again on a sustainable basis unless workers’ wages increase.  The Great Recession shows that families need higher wages to prosper in the long run instead of relying on more and more debt.

Categories: General News Tags: Great Recession, Labor and Employment, New York Times, Strike, Unions, Wages

In a unanimous decision, the North Carolina Court of Appeals upheld the trial court’s decision awarding Plaintiff Rebecca Davis joint custody of the child she raised with her former domestic partner:

Defendant Margaret Swan appeals from an order granting Plaintiff Rebecca Davis joint legal custody and secondary physical custody of Swan’s biological child (“minor child”). Swan argues that the trial court erred by applying the best interest standard to the child custody dispute between the parties. Because the record shows that Swan acted inconsistently with her constitutionally protected right to exclusive care and control of the minor child, we affirm the trial court’s decision to apply the best interest of the child standard.

On appeal, Davis was represented by Burton Craige, Narendra Ghosh, and Sharon Thompson of the Sharon Thompson Law Group.

Categories: Judicial Decisions, Results Tags: Appeals, Burton Craige, Constitutional Law, Family Law, Narendra Ghosh, NC Court of Appeals, Results

On Friday, August 20, 2010, a Cleveland County jury returned a unanimous verdict for our client, Danny Rhodes.  Danny was injured at work in 1992 while working for a long haul trucker for Hersek Express Incorporated.  Since Hersek had no workers’ compensation insurance, Danny had to get a judgment from a Superior Court judge.  When he tried to collect the judgment in 2002, he learned that Hersek had become a new company – Diamond H Incorporated – and that Diamond H now owned all of the assets.  Danny’s former attorney filed a complaint against the companies and their individual owners alleging claims of fraudulent transfer, civil conspiracy and piercing the corporate veil.

We became involved in the case in 2008.   We obtained documents from the Department of Motor Vehicles, the companies’ bank and their accountant to show how the companies and its owners moved money and assets around.  The jury found that Hersek fraudulently transferred five trucks to the new company; they also found that Diamond H and the owners of the two companies controlled Hersek to the extent that it had no separate corporate identity.  Danny is now entitled to collect his judgment from Diamond H and the individual owners as well as from Hersek.  Danny was represented by Ann Groninger and Paige Kurtz of Sprouse & Kurtz, PLLC.

Categories: Results Tags: Ann Groninger, Cleveland County, Enforcing Judgment, Fraudulent Transfer, Litigation, Piercing Corporate Veil, Results, Trial, Workers' Compensation

In a recent unpublished opinion, MGM Investigations Inc. v. Sjostedt, the North Carolina Court of Appeals declared a particular non-compete and non-solicitation agreement to be unenforceable because it was overly broad and too vague.  In the opinion, the Court reviewed many of the core principles in determining whether non-compete agreements are enforceable.

To be enforceable, a non-compete or non-solicitation agreement must meet five requirements – it must be (1) in writing; (2) made a part of the employment contract; (3) based on valuable consideration; (4) reasonable as to time and territory; and (5) designed to protect a legitimate business interest of the employer.  Restrictions on time and territory are considered together.  “Although either the time or the territory restriction, standing alone, may be reasonable, the combined effect of the two may be unreasonable.  A longer period of time is acceptable where the geographic restriction is relatively small, and vice versa.” “The protection of customer relations against misappropriation by a departing employee is well recognized as a legitimate interest of an employer.”

In this case, MGM Investigations had hired the defendants to perform insurance-related investigations regarding federal contracting work overseas.  The non-compete agreement that had been signed restricted defendants from competing “either directly or indirectly, with MJM in its present line(s) of business or in future line(s) of business” for a period of two years.  The trial court held that this provision was unreasonable because it contained no geographic restriction.  The employer did not appeal this conclusion.

The non-solicitation provision stated that defendants could not “solicit any current or prospect client of MJM for the purposes of providing” insurance-investigation-related services.  The trial court had approved this provision specifically with regard to a list of 800 purported “clients” that had been provided by the employer during the case.  The Court of Appeals reversed this conclusion.

The Court found that the terms “current client” and “prospect client” were both too vague without further definition.  No time period or other restriction determined when a company was a current or prospective client.  Especially problematic too was that the restriction would cover clients or prospects that defendants never had any contact with.  Nor could the trial court save the agreement by specifically listing 800 particular “clients” when it had not verified that these companies were indeed clients and the provision did not have a time limit.  Accordingly, the Court declared the non-solicitation agreement to be invalid.

Judge Steelman concurred in the result, but was more sympathetic to the employer’s position, and would have upheld the non-solicitation provision if the trial court had interpreted it more narrowly.

Categories: Judicial Decisions Tags: Case Commentary, Labor and Employment, NC Court of Appeals, Non-Compete Agreements, Non-Solicitation Agreements, Restrictions on Competition, Time and Territory Restrictions

Last week, the Senate finally passed the $26 billion package to aid states that are still reeling from the effects of the recession.  The legislation provides $10 billion to retain teachers who might otherwise lose jobs to cutbacks, and an additional $16 billion to help states with rising health care costs.  The bill was quickly passed by the House and signed by President Obama.

Of that amount, North Carolina received about $300 million to save teachers’ jobs.  North Carolina leaders are now figuring out when and how to use the money.  Obviously, one possibility would be to use some of the funds to re-hire teachers and teaching assistants who were recently laid off due to budget cuts.  Also, some amount may be saved till next year, when the state’s deficit will reach its highest level.

Categories: Legislative Action Tags: Budget, Congress, Jobs, Labor and Employment, North Carolina, President Obama, Teacher Assistants, Teachers

Judge Jim Wynn was finally confirmed to the Fourth Circuit Court of Appeals last week.  Judge Wynn was first nominated for the court in 1999. His confirmation comes after months of being held up in the Senate by Republican obstruction after President Obama re-nominated him last year.  (Republicans, however, are still holding up the confirmation of North Carolina Judge Albert Diaz to another seat on the Fourth Circuit.)  Judge Wynn was sworn in on Tuesday, and officially resigned from his seat on the North Carolina Court of Appeals.  Judge Wynn’s former seat on the Court of Appeals will now be up for election in November.

Categories: General News Tags: Fourth Circuit, Judge Diaz, Judge Wynn, NC Court of Appeals, North Carolina, President Obama, Senate

Prompted by a stark pattern on the U.S. Supreme Court, David Leonhardt of the New York Times addresses the continuing burdens on working parents that still mostly fall on women.  Because employers do not make reasonable accommodations for parental leave, parents who take time off often suffer long-term drops in pay and position, or stop working altogether.  Paid parental leave would help to address this issue.  And, he notes, “With Australia’s recent passage of paid leave, the United States has become the only rich country without such a policy.”

But, given implacable opposition from the business community on this issue, “a more realistic immediate idea may be the recent British law giving workers the right to request a switch to a part-time or flexible schedule. Employers can still say no, but the establishment of a formal right seems to have made a difference. So far, about 90 percent of requests have been approved.”

Categories: General News Tags: Family and Medical Leave, Labor and Employment, New York Times, Paid Leave, Parental Leave, Pay Disparities, Work and Family Balance

The latest workers’ compensation opinion from the North Carolina Court of Appeals, Cardwell v. Jenkins Cleaner, addresses the “going and coming” rule.  “As a general rule, injuries occurring while an employee travels to and from work do not arise in the course of employment and thus are not compensable.”  This “going and coming” rule has further evolved such that “an employee injured while going to and from work on the employer’s premises is generally covered by the Act.”  Thus, injuries in a parking lot not owned by the employer are usually not covered by workers’ compensation.

In this case, the plaintiff was injured when she slipped on some black ice three feet away from the back door to her office.  The majority affirmed the Industrial Commission’s denial of benefits on the grounds that the plaintiff was hurt while she was still in the parking lot and had not yet reached the door.  Chief Judge Martin dissented.  He concluded that because plaintiff in fact was injured on the curb, which  is separate from the parking lot and right outside the employer’s office door, she was within a “reasonable margin” of the employer-provided access to the building, and thus suffered a compensable injury.

Categories: Judicial Decisions Tags: Case Commentary, Compensable Injury, Employer Premises, Industrial Commission, NC Court of Appeals, Parking Lot, Workers' Compensation

The third workers’ compensation decision that the North Carolina Court of Appeals issued last week was Reaves v. Industrial Pump Service, a case that had already been to the Court last year.  Under the Pickrell presumption, “When an employee is found dead under circumstances indicating that death took place within the time and space limits of the employment, in the absence of any evidence of what caused the death, courts should indulge a presumption or inference that the death arose out of the employment.”  The defendant must then show that the death occurred due to a non-compensable cause; otherwise the plaintiff prevails.  In addition, if an employee suffers a heart attack while conducting his work in the usual way, the injury is not compensable.  But, a heart attack can be a compensable accident if it “is due to unusual or extraordinary exertion . . . or extreme conditions.”  Here, plaintiff was working in extreme heat in repairing a basement pump.  Not feeling well, he went to his truck, where is partner found him dead from a heart attack not long afterward.  The Court concluded that the Industrial Commission correctly applied the presumption, that defendant had not rebutted it, and thus that plaintiff’s death was the result of a compensable accident, entitling his wife to workers’ compensation death benefits.

The last workers’ compensation case in this batch is a 2-1 split decision, Shay v. Rowan Salisbury Schools.  The plaintiff, a 15-year teacher, had always used the elevator to get to her second floor classroom.  The elevator broke, and for a month, she had to use the stairs to get to the classroom.  One day, while climbing the stairs, her knee “popped,” and she eventually had to have surgery for a meniscus tear.  Plaintiff did not stumble, fall, trip, slip, or twist her knee causing her injury.  The  Commission found this to be a compensable accident, over Commissioner Ballance’s dissent.  The Court reversed, finding the injury was not from an “accident.”  Continue for more on case: Read more…

Categories: Judicial Decisions Tags: Case Commentary, Compensable Injury, Death Benefits, Heart Attack, Heat Exposure, Industrial Commission, Injury by Accident, Knee Injury, NC Court of Appeals, Pickrell Presumption, Rowan Salisbury, Workers' Compensation