EMPLOYEES BEWARE OF COMPLAINING

I am frequently contacted by persons who are astonished that they have lost their jobs for what they allege is retaliation for complaining about their supervisors, complaining about some company policy or complaining about their work conditions.  What they have in common is that they all believe that their right to complain in general is somehow legally protected. That is certainly not the case for the most part, unless there is some type of law which provides this protection, usually known as a whistleblower law, or there is some legal protection for reporting waste or fraud to a government agency, like the IRS, or an oversight agency in the security industry. Those laws have very specific requirements, and still cannot protect an employee’s job, but they may provide, often many years down the road, a financial award for the reporting person. Workers may be protected if they discuss terms and conditions of employment with one another, but once again, a government agency, such as the National Labor Relations Board, would have to agree to accept their complaint, and the process involved would generally be lengthy and usually not altogether satisfying.

Aside from these limited protections, most employees should be careful about what they complain about, as it may cost them their job. Unless there is some type of discrimination involved, in which case an employee is able to file a complaint with a government agency, an employee has no protection from being terminated. Filing a complaint of discrimination with a government agency also does not protect one’s job, and although employers are not supposed to retaliate against the employee filing the complaint, they often do. Also, even if the employee thinks it isn’t fair that he was terminated and the person he complained about was retained, there is no law that prevents this selection process unless there is discrimination involved. There is not a national workplace anti-harassment law as many employees think there is, and harassment must usually be tied to some protection available under the civil rights laws. Although an employer may have an anti-harassment policy in place, that policy may not have any “teeth” under the law.

I tell these persons that if they had contacted me during the time frame in which they were making the complaint I would have suggested that unless the complaint was extremely important, I may have suggested they not make it at all, or tell them they should have stopped the process if their employer asked them not to pursue it or made an attempt to resolve it, even if the employee wasn’t happy with the attempt. In some cases, I suggest that a lawyer should make the complaint as a buffer between the employee and the employer, and I have been able to save many jobs in this manner, as employers are often reluctant to retaliate against employees if a lawyer is already involved.

Employees are also frequently astonished when they learn that their job is not theirs for life. Pennsylvania is an employment at will state, which means that an employee can usually leave a job at his discretion, unless it violates a contract he has signed, with the converse being that an employer has broad discretion to terminate an employee.  The usual response I receive when I ask the employee why, if their situation is so difficult at work, they don’t look for another job, besides the responses that it is a difficult economy, is that they don’t see why they are the one who should leave.

However, a side effect of continuing to complain when an employer asks you to stop, or feels the situation has already been resolved, is that the employer, in addition to terminating the employee, opposes their claim for unemployment compensation and alleges that the employee has committed some willful misconduct which prohibits them from receiving unemployment compensation. This process often results in delay in receipt of compensation, and possibly loss of compensation if the hearing referee rules in the employer’s favor.

Therefore, before one decides they are going to raise issues based on principle, one had better determine the possibility of being terminated, losing unemployment compensation benefits, and receiving a negative reference from their former employer.

WHY IS THE LAW SO COMPLICATED?

I suspect what has happened to make the law so complicated is that more and more laws, rules, regulations, etc. (referred to in this article as “laws”) have been, and continue to be, added daily by every governmental entity, as it is easier to create new laws then thoroughly examine or repeal existing laws. This is much like the process when Presidential candidates pledge on the campaign trail that if elected, they will eliminate or consolidate government departments and cabinet positions. This rarely happens because of the enormity of the task, the power struggles between the various departments, and because the Federal government not good at laying off personnel (or balancing budgets).

The severe downside of our layered system of laws is that it is nearly impossible for the average person and the small business owner to navigate the legal process.  It is also a problem for large business entities, but they have the resources to seek assistance.

I am constantly surprised to read about the existence of laws I never heard of, and I learn about these laws by reading various legal publications, or hearing about them in legal seminars. Recently I read about a class action which had been brought against an amusement park because when credit cards were used to purchase entry tickets, the expiration date was also printed out. This apparently violated some law.  The end result of the class action was that the amusement park was to give out free tickets to previous customers, and also to the community, if enough previous customers did not avail themselves of the free ticket offer. The only ones who received any money out of the lawsuit were the lawyers. The lawyers were doing a public service by protecting the privacy of the amusement park customers, but one wonders whether every amusement park operator is aware of this law, and if not, are they required to have their lawyers scour the law for such types of law? The answer is yes, they are so required.

The law has become so complex so that even a small matter, such as a buyer discovering a defect in a house he bought, faces some complex laws. In researching the remedies for a client in a similar situation recently, these were the issues we encountered:

• State law exempts an estate (the house was sold by an estate) from responsibility in selling real estate unless the administrator/executor knew about the condition.
• If the buyer complains of a problem, mediation, rather than a court hearing is required by the sales agreement.  The mediator has to be paid by each party involved.
• The buyer had an inspector inspect the property. If the buyer feels the inspector did not do a good job, the inspector’s agreement requires that the matter first be arbitrated, and the buyer cannot take the matter to court, at least initially.

As we were uncertain whether the buyer could prove the seller knew about the defect, or whether the inspector should have told them about the leak, which means each party would point a finger at each other, and because we could not initiate a claim even in a small claims court, where it probably would have been resolved quickly, we advised the clients just to absorb the expense of repairing the problem, which was not large, and certainly far less expensive than paying for a mediator, an arbitrator, or a lawyer.

Upcoming Social Security Seminar on 2/14/12!

Faye Riva Cohen, Esquire will be among the presenters at the NBI Social Security Bootcamp seminar scheduled for February 14, 2012.  You can learn more about it here.

A Second January 2012 article from my office!

Theodore Y. Choi, Esquire from my office, Law Office of Faye Riva Cohen, P.C., has had an article published today in Upon Further Review.  His article, entitled “Social Media Sites ‘Likes’ New Law’s Status” can be found on my site or here at Upon Further Review‘s website.

January 2012 article from my office!

James W. Cushing, Esquire from my office, Law Office of Faye Riva Cohen, P.C., has had an article published today January 10, 2012 in the Pennsylvania Law Weekly section of The Legal Intelligencer.  His article, entitled “Land Use Matter Taxing for Church” can be found on my site or here at The Legal Intelligencer’s website.

Happy Holidays!

The Law Office of Faye Riva Cohen, P.C., Legal Research, Inc., and I wish you all a very happy holiday season and a wonderful New Year!  Thank you very much for following us and reading our blog entries and articles and we hope to bring you more great information and insights in the next year!  As always, if you have any legal issues, questions, cases, or problems, please contact me as soon as possible and we would be happy to discuss it!

THE INTERNET IS NOT A LEGAL EXPERT AND OTHER MUSINGS

The Internet and the Law

The Internet is a two edged sword when it comes to the law. On the one hand, I am often pleasantly surprised to learn how much knowledge a current or potential client has received from the many hours they have surfed the Internet.  On the other hand, much of that knowledge is not relevant to their issue, raises expectations of their case beyond what the facts of their case would deliver in a court of law, and often has no relevancy to the laws ofPennsylvania, where I practice and where my clients generally live or do business.  Inquirers are often surprised to learn that the cases they have reviewed and sent to me to review have absolutely no relevancy toPennsylvaniaor, quite often, their issue.

Lawyers generally know how to conduct legal research and hone in on effective and relevant law, so if a client wants me to read through many cases they feel are relevant which they have pulled from the Internet, I will do so, but I will charge them for doing so. I think their money is better spent on me conducting the research.

For instance, I recall a situation where a lawyer in another state achieved what my client thought was a remarkable result in the field of education law. I called the lawyer who told me the results of her case were “one in a million”, was entirely based on the unique facts of the situation, that her client was given significant help from some employees who worked for the school she was suing, and other fluky factors. Although the universe combined in that instance to create a unique result, and that is what it was—unique to the facts of the case- it was totally unrelated to the law as it stands in Pennsylvania.

Remember that the Internet has no controls, so anything can be mentioned. This does not mean that the things mentioned are even true. I am always surprised to learn that clients feel that if something is on the Internet, it is gospel. THE INTERNET IS NOT THE FONT OF KNOWLEDGE.  

So, There is Nothing I can Do…

 It always astonishes, and sometimes angers me, when I have spent time my time, often free of charge, giving a potential client my opinion on their legal options, and they conclude by saying “so, there is nothing I can do” or “you don’t sound optimistic”. I did not say that!  I gave the potential client choices and possible results.

 The disconnect between what I say and what a client often hears or wants to hear, comes because many people today, especially those who want or need to spend their hard earned dollars on legal representation, want a guarantee of excellent results. The law, and lawyers, cannot usually provide guarantees. In fact, I tell clients if they meet with a lawyer who guarantees a result, I would run the other way. There are so many factors which enter into a case, not the least of which is the opposing party, the opposing lawyer, the judicial system, the facts, the law, etc., that a result can’t be guaranteed.  The law is not a shirt whose collar frays and one can demand their money back.

 What disturbs me even more is that the same people who are concerned about whether they have a 100% winnable case, and want a guarantee of same, have often spent considerable money on things related to the case for which they will not receive any benefit. They have done this without consulting a lawyer, or they have consulted everyone besides a lawyer, such as a real estate agent, an accountant, their neighbors, their family, their friends, and anyone else who is not a lawyer, who have given them poor and quite often damaging and misleading advice. If one were to do a cost benefit analysis, the amount they would have spent on a lawyer to handle the matter effectively is usually far less than what they have spent in this round-about fashion of avoiding lawyers and the legal system.

 For example, I had an elderly woman consult me once who had paid $40,000 in back taxes and bringing a mortgage current after it had fallen in arrears, on a house which was owned by her niece. Yet, she did not want to pay a fraction of that amount to undertake the process of placing the house into her name.  Under the law she made a gift to her niece, and has no legal basis to recoup it if the niece sells the house or encumbers it. She doesn’t own the house.  And, this is not an unusual situation. Not only had she not consulted a lawyer prior to spending this amount, but she said she didn’t have the money to pay a lawyer to do what was necessary to give her the benefit of her investment, for a couple of thousand dollars.  I wish someone would come along and pay my bills.

I have said this before in my blogs. Do not be pennywise and pound foolish. Consult a lawyer and keep an open mind and do not expect a guarantee under the law. But, if you have a fighting chance, lawyers perform small miracles daily, and they can certainly give you better advice about the law than people who aren’t lawyers.

I am leading a Social Security Seminar on 2/14/12

The seminar is facilitated by the National Business Institute and is called “Social Security Disability Boot Camp”.  It is taking place in Philadelphia, Pennsylvania.  If you are interested in attending, you can register at www.nbi-sems.com.  Thanks!

WHO IS AN INDEPENDENT CONTRACTOR?

A “hot button” topic these days is whether a worker is an independent contractor or an employee. This topic arises both in work and tax arenas, and is not a simple issue.  In the work arena the issue often arises when someone applies for unemployment compensation benefits. In Pennsylvania someone who is an independent contractor is not eligible for unemployment compensation benefits, and is considered self-employed.

Pennsylvania Courts use a two-part test to make this distinction. It is: (1) whether the worker was free from control and direction in the performance of the work; and (2) whether the business is one that is customarily engaged in as an independent trade or business. If the alleged employer opposes a claim for benefits based on an independent contractor defense, the alleged employer generally has the burden to prove that the worker was not an employee.

To determine whether a worker is free from the control and direction of an employer in the performance of work, Pennsylvania Courts frequently consider and weigh eight factors. 1. How the job was performed? Does a worker set his own hours, create his own work/task agenda, and/or decide how many other workers are needed for a particular task? 2. Whether there was a fixed rate of pay, who decides the cost of the services being provided, and who decides when/if raises are granted? The amount of money a worker earns is not significant in the analysis. 3. Whether taxes are deducted from the worker’s pay, or is a W2 or a 1099 issued? 4. Whether the alleged employer supplies the tools necessary to carry out the services being provided? 5. Does the alleged employer offers on-the-job training? 6. Whether there were regular meetings with the alleged employer? 7. If the business fails, will the worker only lose his job, or will he have the responsibility to satisfy the business’s potential creditors? 8. Does the worker work exclusively for one employer, or is he free to accept other jobs at the same time?

Ultimately, all of the above factors can be reduced to two words: The first is FREEDOM. Does the worker have the freedom to set his own schedule, to establish his own pay rate, to compete with the business?  The second is RESPONSIBILITY. Does the worker pay his own taxes, use his own tools, and/or bear the risk and burden of financial loss in the business?

Generally under the IRS regulations, a worker is deemed to be an independent contractor rather than employee if the employer has the right to control or direct only the result of the work and not the means or methods by which the results are accomplished.  A worker is classified as an employee if the employer has the right to control what will be done and how the services will be performed.

The IRS regulations focus on (1) relationship of the worker and the business, (2) the degree of control exercised by the business on the worker, and (3) the worker’s degree of independence. The IRS also has regulations specific to certain jobs and salespeople, drivers, and other persons who generally don’t work in an office setting and has further criteria to determine if federal taxes should be withheld for them. In some cases although W 2’s versus 1099’s are provided, some taxes need not be withheld and some expenses can still be deducted by the worker.

The IRS seeks to qualify as many workers as possible as employees rather than independent contractors, so that taxes can be collected. IRS regulations take into account the behavioral control, financial control, and the type of relationship of the parties in making this analysis. Many of these factors are the same ones as discussed above in the unemployment compensation context, so they won’t be repeated. Other factors which are considered in determining the relationship between a worker and an employee are: whether there is a written employment contract; whether the worker is provided any benefits such as insurance, pension plan, vacation pay, or sick pay; and whether there is a finite end date for employment of the relationship.

If a worker is erroneously classified as an independent contractor rather than an employee, the employer will be held liable for all of the employment taxes, but if the employer has a reasonable basis for misclassifying a worker, they will not be held liable.  Such relief is only provided if the employer filed all required federal information returns on a basis consistent with the treatment of the worker, such as showing that all workers in a substantially similar position were classified in the same manner.

Businesses should consider reviewing their current payroll practices.  Documentation and record-keeping procedures should be reviewed and updated if necessary. Even if a worker is found to be misclassified by the employer, the employer may still be entitled to partial relief from federal employment taxes if they participate in the Voluntary Classification Settlement Program (VCSP). There are specific requirements for participation which I won’t delve into here. SUFFICE IT TO SAY THAT THE QUESTION OF EMPLOYEE CLASSIFICATION IS QUITE COMPLICATED AND BECOMING MORESO.  

DEBUNKING COMPLAINTS AGAINST LAWYERS

 I frequently receive calls from potential clients complaining about other lawyers who represent them, have represented them, or they have called to represent them.  Below are some of my favorite call topics, and my responses to them.

Comment:  “I have called or e mailed many lawyers and no one but you have returned my calls or e mails.”

Response:  A lawyer does not want to talk to someone who is fishing around for free advice, and calls 15-20 lawyers or more in the process. A short inquiry is fine, but some callers want to spend a large amount of time discussing their situation. Lawyers generally only need specific information to determine if callers have a viable case, so please be respectful of their time and the questions you ask of them. A general e mail is even worse, because it is unclear how many lawyers have been contacted via one e mail. I have had many e mails sent to me via websites which are addressed to lawyers with different names. The inquirer did not even take the time to change the name. Why would a lawyer even respond to such an e mail?  There are also many scam e mails lawyers receive from all over the world, and it is difficult to tell which are legitimate.

Many inquirers do not seem to realize that “a lawyer’s time and advice are his stock in trade”, a saying that is usually attributed to Abraham Lincoln.  Let’s do the math. If a lawyer gets 20 calls a day from prospective clients and spends an average of 15 minutes on each call, they have spent 5 hours on the phone and they haven’t earned a dime if all of those callers are trolling around for free advice. They have businesses to run and expenses to meet. These same callers would not dream of taking up another professional’s time free of charge.

Comment: “My lawyer didn’t do anything, or didn’t say anything in court.”

Response:  Although this may be the case, in my many years of experience I find this is rare. Lawyers often do much of their work behind the scenes, and do not communicate every single thing they do to their client, as this would be even more time-consuming, especially to clients who pay hourly, and who would not appreciate being charged for this service.  Clients need to trust that their lawyers are putting in the necessary time to assist them, and in contingency fee cases, lawyers don’t get paid if they don’t settle or win a case, so why would they not do the work to ensure success? Lawyers also cannot guarantee the results of any case.

Lawyers who appear in court have to measure what they say. They don’t often want to raise numerous objections which may offend the judge and delay the proceedings; they may determine from the judge’s mood or nature of the case that saying less would be better; and they may decide to play the good layer and let the opposing lawyer rant and rave to their client’s detriment. Clients don’t always understand these nuances and think that the lawyer who rants and raves is the better lawyer. They probably get this impression from television, but a real courtroom experience is very different from a televised courtroom experience.

Comment: “Many other lawyers have told me what you said, but I don’t believe it and I want to take my chances that I can convince the judge of my case on my own.”

Response:  I often say to clients, would you perform brain surgery on yourself, and if not, why do you think you know more about the law and courtroom procedure than a lawyer? Do not mistake your ability to file a case in court as a pro se litigant with the certainty that you can represent yourself successfully.  The law and the rules surrounding it are extremely complex and vary from court to court and county to county. Of course there are some people who represent themselves successfully, but this is a very rare outcome in a complex case in a court other than a first level court.

Comment: “It isn’t fair, where is justice?”

Response: Life in general isn’t fair, and justice depends on many things. A soup to nuts lawsuit on certain matters costs a minimum of $75,000-$100,000 and upwards for a lawyer’s time, plus thousands of dollars in court. If one can afford to pay a lawyer that amount, that is great. If one can find a firm to accept the case on a contingency fee basis (usually in serious injury or death cases), that is great, but for the vast majority of others, their path to fairness and justice in the legal system will be seriously limited by what they can afford to spend.

Comment:  “I spent all of my money (fill in the amount, but it is usually into the many thousands of dollars) on a lawyer and now I have no money left, so can you take my case on a contingency fee basis?”

Response:  I love these calls, and wonder, why wasn’t I the one they had thousands of dollars to pay? It is not a lawyer’s responsibility to pick up a case free of charge after another lawyer/s have worked on a case and gotten paid. Oftentimes the cases at issue are those in which a lawyer can’t possibly make money (although the callers assure the lawyer will make millions from the free publicity), such as custody or support cases, or which are so far along in the legal process, or so many mistakes have already been made, that it is a losing case.

My final comment is please be respectful of a lawyer’s time and advice, as it is their stock in trade, and should not be wasted.