In Lockett v. Sister-2-Sister Solutions, Inc., the North Carolina Court of Appeals reversed the dismissal of a breach of contract claim based on the plaintiff’s employment.  In this case, the plaintiff had an employment contract with the defendant that provided that he could only be fired for cause.  The Court held that “an employment relationship that can be terminated by the employer only for cause would succeed in removing an employment contract from the presumption of at-will employment.”  Therefore, the plaintiff can have a breach of contract claim for being terminated.

On the other hand, the plaintiff did not present enough evidence to bring his contract claim and North Carolina Wage and Hour Act claim against the company’s owner directly.  Thus, the claims against the individual owner were properly dismissed.

Categories: Judicial Decisions Tags: At-Will Employment, Breach of Contract, Case Commentary, Employment Contract, Labor and Employment, NC Court of Appeals, NC Wage and Hour Act

In Williams v. American Eagle Airlines, the North Carolina Court of Appeals addressed the interplay between union contracts and employment claims.  In this case, the plaintiff had been a part-time fleet service clerk for American Eagle, where she was a member of the Transport Worker’s Union, and was covered by a collective bargaining agreement.  She also had a full-time administrative position at Duke.  In 2006, the plaintiff injured her shoulder while moving luggage, started receiving workers’ compensation benefits, and eventually had surgery.  Following surgery, plaintiff resumed her duties at Duke, but did not return to American Eagle, apparently with representations that should not return to work at all.  Because of this inconsistency, American Eagle terminated her for dishonesty related to her workers’ compensation.

Rather than file a grievance through the Union, the plaintiff filed suit in state court, alleging claims for (1) breach of contract because she was fired without just cause; and (2) violation of the the North Carolina Retaliatory Employment Discrimination Act (“REDA”) because her termination was cause by her use of workers’ compensation.  At trial, the jury ruled against the plaintiff on the REDA claim, but found in her favor on the contract claims and awarded damages.

On appeal, the Court vacated the verdict because the contract claims were legally barred.  “When an employee’s claim is firmly rooted in a breach of a collective bargaining agreement and asserts no rights independent of that agreement, such claim is preempted by the Railway Labor Act (RLA).”  (The RLA governs unions in the airline industry.)  In other words, when an employee wants to challenge her termination as unlawful under a CBA, she usually must pursue the matter through the CBA’s grievance mechanism instead of in court.  As this plaintiff did that, the breach of contract claims were legally barred, and the verdict had to be vacated.

Categories: Judicial Decisions Tags: Airlines, Breach of Contract, Case Commentary, CBA, Grievance, Labor and Employment, NC Court of Appeals, REDA, TWU, Union, Workers' Compensation

The North Carolina Court of Appeals published two decisions on workers’ compensation this month.  The first case, Kingston v. Lyon Construction, concerns workers’ compensation liens and third-party recoveries.  The plaintiff was exposed to asbestos on the job and developed illness as a result.  He was awarded workers’ compensation benefits, and brought and settled tort cases against manufacturers of the asbestos.  He then brought a motion to determine the workers’ compensation liens under N.C.G.S. § 97-10.2(j).  The Court of Appeals affirmed the trial court’s conclusions that the motion was proper even though only some of the third-party cases had been resolved, and that the workers’ compensation lien should be eliminated entirely because the third-party recoveries were reduced due to bankruptcies.

The second case, Nobles v. Coastal Power & Electric, concerns an issue of suitable employment.  The Industrial Commission had awarded temporary total disability benefits up to the time of the plaintiff’s maximum medical improvement, but did not find him disabled afterward.  The primary issue regarding disability concerned the defendant’s offer of a new position to plaintiff to accommodate his injury.

“The Workers’ Compensation Act provides that an injured employee is not entitled to compensation if he unjustifiably ‘refuses employment procured for him suitable to his capacity.’” N.C.G.S. § 97-32.  “Suitable employment is defined as any job that a claimant is capable of performing considering his age, education, physical limitations, vocational skills, and experience.”  However, “employers may not avoid paying compensation merely by creating for their injured employees makeshift positions not ordinarily available in the market.”  In this case, the Court upheld the Commission’s findings that the position offered to the plaintiff was suitable, and was not make-work because it had been offered previously and subsequently to others.

Categories: Judicial Decisions Tags: Asbestos, Case Commentary, Disability Benefits, Industrial Commission, Liens, NC Court of Appeals, Personal Injuries, Suitable Employment, Third-party Suits, Workers' Compensation

In an opinion issued two weeks ago, Johnston v. Duke University Medical Center, the North Carolina Court of Appeals concluded that the plaintiff’s occupational disease workers’ compensation claim was time-barred.  The plaintiff had been a nurse at Duke, and developed several conditions in her left foot: plantar fasciitis, tarsal tunnel syndrome, and Achilles tendinopathy.  These conditions developed over several years from the 1990′s through 2005, but the plaintiff did not file this case until 2007.

N.C. Gen. Stat. 97-58 specifies the statute of limitations for occupational disease claims.  Under that provision, “the two-year period within which an occupational disease claim must be filed with the Commission … begins to run when the employee learns that he or she has a work-related disability stemming from that occupational disease.”  In this case, the Court found that because all of the plaintiff’s left foot conditions were continuous and interrelated, and that the plaintiff had been told by her physician that her condition had been caused by work as early as 2001, the plaintiff had missed the two-year deadline to file her claim.  The Court rejected the plaintiff’s contention that each different diagnosis should be treated as a separate possible claim.

Categories: Judicial Decisions Tags: Case Commentary, Duke University Medical Center, NC Court of Appeals, Occupational Disease, Statute of Limitations, Workers' Compensation

Earlier this month, the North Carolina Court of Appeals issued an opinion concerning the viability of plaintiff’s Woodson claim — a wrongful death tort action based on an injury sustained at work.  In Valenzuela v. Pallet Express Inc., the Court once again rejected a Woodson in what seemed to be an egregious case.  Typically, plaintiffs injured at work can only bring claims under workers’ compensation, and not tort actions, such as for wrongful death.  There is an exception, however, for injuries resulting from intentional misconduct by the employer or “conduct that, while not categorized as an intentional tort, was nonetheless substantially certain to cause serious injury or death to the employee.”

In this case, the plaintiff alleged that the employer: 1) removed safety guards from the shredder which sacrificed employee safety for increased production; 2) assigned an underage employee to work on heavy equipment in violation of State and federal law; 3) failed to provide Nery with proper training on the shredder; and 4) failed to ensure that trained personnel were present when the shredder was operated.  The underage 17-year-old worker was left unattended and was killed when he apparently fell into the giant shredder machine.  Nonetheless, the Court concluded that the employer’s alleged was not reckless enough to constitute a valid Woodson claim.  Given the egregiousness of the conduct here, it is hard to imagine any non-intentional conduct that the Court would accept under Woodson.

Categories: Judicial Decisions Tags: Case Commentary, NC Court of Appeals, Tort, Woodson Claims, Workers' Compensation, Wrongful Death

On September 21, 2010, the North Carolina Court of Appeals released its latest batch of opinions, which included one published case on workers’ compensation.  In Pope v. Johns Manville, the Court issued a second opinion in this case after granting defendants’ petition for rehearing.  The Court’s first opinion in this case, issued earlier this year, affirmed the Industrial Commission’s decision that the plaintiff had developed asbestosis from asbestos exposure during the 50′s and 60′s and that he was disabled due to his asbestosis.  In this second opinion, the Court reconsidered the Commission’s decision on how much disability pay the plaintiff was due.

The Commission had calculated the plaintiff’s average weekly wage (AWW) based on his earnings in 2003, the last year he worked.  Plaintiff was not diagnosed with asbestosis until 2005, after he had retired.  The Court held that because the plaintiff is considered “injured” on the date of his asbestosis diagnosis, his AWW must be calculated from that point.  Of course, because someone retired has no weekly wages, an exceptional method of measuring lost wages is probably appropriate under the fifth prong of the AWW definition of N.C. Gen. Stat. 97-2(5).  The Court remanded the case to the Commission to reconsider the AWW issue and make the appropriate findings to support a decision on the AWW question.

Categories: Judicial Decisions Tags: Asbestos, Asbestosis, Average Weekly Wage, Case Commentary, NC Court of Appeals, Workers' Compensation

Earlier this week, the North Carolina Court of Appeals published its latest workers’ compensation decision in Hedges v. Wake County Public School System.  In this case, the plaintiff had stumbled and fell when she walked into a workroom to make copies of payroll materials.  The plaintiff did not trip on something; she simply stumbled and fell.  Because of the awkward way in which she fell, she tore her rotator cuff, which required surgery and three months out of work.  For no good reason, the defendants denied the claim.

The plaintiff won in front of the Deputy Commissioner and Full Commission, and was also awaded attorneys’ fees because of the defendants’ unreasonable defense.  On defendants’ appeal, the Court correctly affirmed both the award of benefits and attorneys’ fees.  Details below:  Read more…

Categories: Judicial Decisions Tags: Attorneys' Fees, Case Commentary, Compensable Injury, Industrial Commission, Injury by Accident, NC Court of Appeals, Unexplained Fall, Workers' Compensation

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

In a recent unpublished opinion, MJM 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, MJM 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

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