Labor Law Archives - New York Appellate Digest

Appeals, Civil Procedure, Employment Law, Evidence, Labor Law, Negligence, Unemployment Insurance

DESPITE THE ALLEGATION THAT THE DRIVER HAD LOGGED OFF THE UBER APP PRIOR TO THE PEDESTRIAN-VEHICLE ACCIDENT, QUESTIONS OF FACT PRECLUDED SUMMARY JUDGMENT ON THE VICARIOUS LIABILITY THEORY; THE UNEMPLOYMENT INSURANCE APPEAL BOARD’S FINDING THAT THE DRIVER WAS EMPLOYED BY UBER WAS NOT ENTITLED TO PRECLUSIVE EFFECT; ISSUE NOT RAISED BELOW PROPERLY CONSIDERED ON APPEAL (SECOND DEPT).

The Second Department, reversing (modifying) Supreme Court in this pedestrian-vehicle accident case, determined: (1) a ruling by the Unemployment Insurance Appeal Board finding that defendant driver was an employee of defendant Uber was not entitled collateral-estoppel effect pursuant to Labor Law 623( 2); (2) although the Labor Law 623(2) argument was not raised below, it raised a question of law which could not have been avoided below and therefore was considered on appeal; (3) the claim that defendant driver had logged off the Uber app at the time of the accident did not warrant summary judgment in favor of Uber on the vicarious liability theory:

An action may be considered to be within the scope of employment, thus rendering an employer vicariously liable for the conduct, when “the employee is engaged generally in the business of the employer, or if the act may be reasonably said to be necessary or incidental to such employment” … . Whether an employee was acting within the scope of his or her employment is generally a question of fact for the jury … .

Here, contrary to Uber’s contention, the averments [that the driver] had logged off of the Uber app 40 minutes before the accident were simply insufficient, without more, to eliminate all questions of fact as to whether Hussein was acting within the scope of his alleged employment with Uber at the time of the incident … . Uy v Hussein, 2020 NY Slip Op 05080, Second Dept 9-23-30

September 23, 2020/0 Comments/by Bruce Freeman

Attorneys, Civil Procedure, Contract Law, Employment Law, Labor Law

PLAINTIFF ENTITLED TO UNPAID SALARY, PREJUDGMENT INTEREST AND ATTORNEYS FEES PURSUANT TO LABOR LAW 198 AND CPLR 5001 IN THIS BREACH-OF-A-WRITTEN-EMPLOYMENT-CONTRACT ACTION (SECOND DEPT).

The Second Department, reversing (modifying) Supreme Court, determined plaintiff was entitled to salary, prejudgment interest and attorney’s fees stemming from plaintiff’s employer’s breach of a written employment agreement:

Pursuant to CPLR 5001 et seq., the plaintiff is entitled to such statutory prejudgment interest based on the defendant’s breaches of the written agreement. Moreover, contrary to the defendant’s contention, the plaintiff’s unpaid wages … and the severance wages fall within the definition of wages as set forth in Labor Law § 190(1) … . Therefore, such wages are protected by the provisions set forth in Labor Law § 193 and fall within the ambit of remedies provided by Labor Law § 198 … . * * *

… [F]or the same reasons that the plaintiff is entitled to prejudgment interest, the plaintiff also established his entitlement to judgment as a matter law on so much of the second cause of action as sought an award of reasonable attorney’s fees under Labor Law § 198(1-a) … . Gertler v Davidoff Hutcher & Citron , 2020 NY Slip Op 04731, Second Dept 8-26-20

August 26, 2020/by Bruce Freeman

Civil Procedure, Employment Law, Labor Law

IN LIGHT OF THE REVERSAL BY THE COURT OF APPEALS, PLAINTIFF HOME HEALTH CARE AIDES WERE NOT ENTITLED TO CLASS CERTIFICATION ON THE QUESTION WHETHER THEY SHOULD BE PAID FOR THE SLEEP AND BREAK HOURS DURING 24-HOUR SHIFTS (SECOND DEPT).

The Second Department, on remittal after reversal by the Court of Appeals, determined plaintiffs, home health care aides, were not entitled to class certification on the question whether they were entitled to be paid for the sleep and break hours during 24-hour shifts. The Court of Appeals ruled that the NYS Department of Labor’s (DOL’s) finding that the flat-rate pay did not violate the Minimum Wage Order (Wage Order) was not irrational or unreasonable:

On March 26, 2019, the Court of Appeals reversed this Court’s decision and order, concluding that the DOL’s interpretation of the Wage Order did not conflict with the promulgated language and was not irrational or unreasonable … . The Court of Appeals remitted the matter to this Court to determine whether the plaintiffs’ class certification motion was properly denied, considering the DOL’s interpretation of the Wage Order as well as alternative bases for class certification asserted by the plaintiffs.

The proponent of a motion for class certification bears the burden of establishing the requirements of CPLR article 9 … . CPLR 901 sets forth five prerequisites to class certification. “These factors are commonly referred to as the requirements of numerosity, commonality, typicality, adequacy of representation and superiority” … . “A class action certification must be founded upon an evidentiary basis” … .

… [I]n light of the DOL’s interpretation of the Wage Order, the plaintiffs have failed to demonstrate entitlement to class certification on the question of whether the defendants violated the law by failing to pay them for all hours of a 24-hour shift. Although a worker must be paid minimum wage for the time he or she is “required to be available for work at a place prescribed by the employer,” under the DOL interpretation of the Wage Order, a worker is not considered to be “available for work at a place prescribed by the employer” during designated meal and sleep breaks, totaling 11 hours of a 24-hour shift … . Moreno v Future Health Care Servs., Inc., 2020 NY Slip Op 04473, Second Dept 8-12-20

August 12, 2020/by Bruce Freeman

Civil Procedure, Employment Law, Labor Law, Tax Law

ALTHOUGH DISFAVORED, DISCLOSURE OF REDACTED TAX RETURNS WAS WARRANTED IN THIS CASE (FIRST DEPT).

The First Department noted that the disclosure of tax returns is disfavored, but agreed with Supreme Court that disclosure of the redacted returns in this Labor-Law/employment-law dispute was warranted:

Plaintiffs claim that between 2010 and 2016 defendant employed them as a caretaker for her ailing aunt and that defendant violated, inter alia, several sections of the Department of Labor Regulations (12 NYCRR) requiring overtime pay, a minimum wage, and additional pay for split shifts. Defendant denies that she was plaintiffs’ employer for purposes of the regulations and provisions of the Labor Law, but admits that she paid plaintiffs by check from 2014 to 2016, albeit on her aunt’s behalf. Plaintiffs claim they were paid in cash by defendant between 2010 and 2013. Defendant, who denies that she was the source of the cash payments, seeks plaintiffs’ federal and state tax returns for 2010 to 2013, claiming she needs the returns to verify the cash amounts, as well as plaintiffs’ assertion that they were employees, and not independent contractors.

… [D]efendant demonstrated both that the specific information ordered disclosed was necessary to defend the action, and unavailable from other sources … . Since plaintiffs were paid in cash between 2010 and 2013 and there is no other evidence in the record establishing who paid their wages and how much they were paid during those years, defendant showed a specific need for the production of the three years of tax returns, which might show the amounts claimed by plaintiffs as income from the caretaker work, as well as whether they claimed the income as wages or as money earned through self-employment. Defendant demonstrated that investigating plaintiffs’ bank accounts would be inconclusive, since pay deposited in the accounts could have been commingled with other amounts, and because one of the plaintiffs claimed that she used several banking institutions and did not make deposits on a predictable basis. We note that the court already inspected the tax returns in camera and deemed them relevant. Currid v Valea, 2020 NY Slip Op 03590, First Dept 6-25-20

June 25, 2020/by Bruce Freeman

Labor Law, Unemployment Insurance

CRITERIA FOR DETERMINING WHETHER A CLAIMANT IS A SEPARATE BUSINESS ENTITY PURSUANT TO THE FAIR PLAY ACT CLARIFIED; MATTER REMITTED TO THE UNEMPLOYMENT INSURANCE APPEAL BOARD FOR A DECISION WHETHER CLAIMANT WAS AN EMPLOYEE OR AN INDEPENDENT CONTRACTOR USING THE CORRECT ANALYTICAL CRITERIA (THIRD DEPT).

The Third Department, in a full-fledged opinion by Justice Devine, reversing the Unemployment Insurance Appeal Board and remitting the matter, clarified the meaning of the first criterion for determining whether claimant is an employee or an independent contractor pursuant to the so-called separate business entity test under the Fair Play Act. Here, the Board found that the claimant was an employee of Adelchi entitled to unemployment benefits, but the Third Department, agreeing with Adelchi’s argument, held the Board had not applied the proper criteria to its analysis:

The issue [is] whether claimant could be viewed as a separate business entity and, in that regard, Adelchi argues that the Board misconstrued the first criterion of the separate business entity test by demanding proof of a total lack of direction or control over a business entity (see Labor Law § 861-c [2] [a]). Adelchi contends that this criterion of the separate business entity test instead codifies the common-law rule that “[a]n employer-employee relationship exists when the evidence demonstrates that the employer exercises control over the results produced by claimant or the means used to achieve the results” … , which involves a fact-specific inquiry where “the relevant indicia of control will necessarily vary depending on the nature of the work” … . * * *

We … conclude that the first criterion in the separate business entity test does not require a contractor to show a total lack of direction or control over a business entity, but instead that their relationship as a whole did not show sufficient “control over the results produced or the means used to achieve the results” by the contractor to reflect an employer-employee relationship … . Although the factual findings already made by the Board would appear to permit the determination that Adelchi did not meet the first criterion under the proper analysis, we are constrained to reverse and remit so that the Board may answer that question in the first instance … . Matter of Tuerk (Adelchi Inc.–Commissioner of Labor), 2020 NY Slip Op 03441, Third Dept 6-18-20

June 18, 2020/by Bruce Freeman

Education-School Law, Labor Law, Unemployment Insurance

A PART-TIME COLLEGE INSTRUCTOR SHOULD NOT HAVE BEEN AWARDED UNEMPLOYMENT BENEFITS BECAUSE HE HAD BEEN ASSURED OF EMPLOYMENT IN THE SEMESTER FOLLOWING THE SUMMER BREAK; TWO-JUSTICE DISSENT (THIRD DEPT).

The Third Department, reversing the Unemployment Insurance Appeal Board, over a two-justice dissent, determined claimant, a part-time community college instructor, should not have been awarded unemployment benefits because he had been notified he would be employed in the semester after the summer break. The dissenters argued his employment depended upon course-enrollment which was uncertain:

Pursuant to Labor Law § 590 (10), “professionals who are employed by educational institutions are precluded from receiving unemployment insurance benefits during the period between two successive academic periods if they have received a reasonable assurance of continued employment” … . “A reasonable assurance has been interpreted as a representation by the employer that substantially the same economic terms and conditions will continue to apply to the extent that the claimant will receive at least 90% of the earnings received during the first academic period … . * * *

On the record before us, the Board’s decision was not supported by substantial evidence … . inasmuch as claimant received a reasonable assurance of continued employment for the 2018 fall semester such that he was ineligible to receive unemployment insurance benefits … . Matter of Barnett (Broome County Community Coll.–Commissioner of Labor), 2020 NY Slip Op 02229, Third Dept 4-9-20

April 9, 2020/by Bruce Freeman

Civil Procedure, Employment Law, Labor Law

LABOR LAW 198-b, WHICH PROHIBITS AN EMPLOYER’S COLLECTING KICKBACKS FROM AN EMPLOYEE, DOES NOT CREATE A PRIVATE RIGHT OF ACTION AGAINST THE EMPLOYER (FOURTH DEPT).

The Fourth Department, reversing Supreme Court, determined Labor Law 198-b, which essentially prohibits an employer from collecting kickbacks from and employee, did not create a private right of action:

Plaintiff, a former teacher at defendant Utica Academy of Science Charter School (UASCS), commenced this action seeking to recover damages based upon allegations that there in which plaintiff was required to provide donations to [defendant] High Way in the form of illegal kickbacks of his salary under threat of demotion or termination. In his third cause of action, plaintiff alleged that defendants’ conduct violated Labor Law § 198-b, and plaintiff sought damages arising from that violation pursuant to Labor Law § 198. …

Although we offer no opinion with respect to whether other provisions within article 6 of the Labor Law afford private rights of action, we agree with High Way that the legislature did not intend to create a private right of action for violations of Labor Law § 198-b … , inasmuch as ” [t]he [l]egislature specifically considered and expressly provided for enforcement mechanisms’ in the statute itself” … . Indeed, by its express terms, a violation of section 198-b constitutes a misdemeanor offense … . Konkur v Utica Academy of Science Charter Sch., 2020 NY Slip Op 01827, Fourth Dept 3-13-20

March 13, 2020/by Bruce Freeman

Civil Procedure, Employment Law, Labor Law, Municipal Law

DISMISSAL OF THE ACTION SEEKING OVERTIME PAY IN FEDERAL COURT ON THE GROUND NO NOTICE OF CLAIM WAS FILED DID NOT PRECLUDE, PURSUANT TO THE DOCTRINE OF RES JUDICATA, AN ACTION IN SUPREME COURT SEEKING PERMISSION TO FILE A LATE NOTICE OF CLAIM (SECOND DEPT).

The Second Department, reversing Supreme Court, determined the dismissal of the action concerning overtime pay in federal court, on the ground no notice of claim had been filed, did not preclude the action in Supreme Court seeking leave to file a late notice of claim:

… [T]he federal court dismissed the New York Labor Law claims for failure to file a timely notice of claim (see County Law § 52; General Municipal Law § 50-e). …

… [S]o much of the petition as sought leave to deem the late notice of claim timely served nunc pro tunc is not barred by the doctrines of collateral estoppel and res judicata. Although collateral estoppel precludes a party from relitigating in a subsequent action or proceeding an issue which was raised and decided in a prior action or proceeding … , the issue of whether the petitioners could obtain leave to deem the late notice of claim timely served nunc pro tunc pursuant to General Municipal Law § 50-e(5) was not litigated or decided by the 2017 federal order. As the issue was not litigated, the petitioners are not precluded from raising it … .

Res judicata also is inapplicable to so much of the petition as sought leave to deem the late notice of claim timely served nunc pro tunc. “Under the doctrine of res judicata, a disposition on the merits bars litigation between the same parties, or those in privity with them, of a cause of action arising out of the same transaction or series of transactions as a cause of action that either was raised or could have been raised in the prior proceeding” … . Since the federal court was without jurisdiction to determine whether the petitioners could obtain leave to deem the late notice of claim timely served nunc pro tunc (see General Municipal Law § 50-e[7]), the petitioners are not precluded by the doctrine of res judicata from seeking a determination of this issue … . Matter of Chodkowski v County of Nassau, 2020 NY Slip Op 01058, Second Dept 2-13-20

February 13, 2020/by Bruce Freeman

Civil Procedure, Employment Law, Evidence, Judges, Labor Law

SUPREME COURT SHOULD NOT HAVE, SUA SPONTE, GRANTED RELIEF NOT REQUESTED IN PLAINTIFFS’ UNOPPOSED MOTION AND SHOULD NOT HAVE CONSIDERED EVIDENCE NOT BEFORE IT; THE ORDER SETTLING A CLASS ACTION FOR UNPAID WAGES AND OVERTIME SHOULD NOT HAVE DECLARED INVALID CERTAIN OPT-OUT STATEMENTS WHICH WERE NOT REFERRED TO IN PLAINTIFFS’ MOTION AND WERE NOT OTHERWISE BEFORE THE COURT (SECOND DEPT).

The Second Department, reversing Supreme Court in this class action seeking unpaid wages and overtime, determined Supreme Court should not have. sua sponte, declared certain opt-out statements (opting out of the class action settlement) invalid because the issue was not raised by the plaintiff’s motion and the opt-out statements were not properly before the court:

Pursuant to the February 2018 order, all class members who did not opt out were permanently enjoined from asserting, pursuing, and/or seeking to reopen claims that were released pursuant to the settlement agreement. The February 2018 order also contained a handwritten provision declaring that “[t]he opt outs received on 1/26/18 from Lee Litigation Group are deemed invalid as they were dated prior to the Class Notice which was sent 12/27/17, and do not contain the required opt-out language pursuant to the Class-Notice ordered by this court on November 22, 2017.” Such relief was not sought in the motion filed by the plaintiffs nor was it contained in the proposed order submitted to the court by the plaintiffs’ counsel. …

CPLR 908 provides that “[a] class action shall not be dismissed, discontinued, or compromised without the approval of the court,” and that “[n]otice of the proposed dismissal, discontinuance, or compromise shall be given to all members of the class in such manner as the court directs.” Contrary to the plaintiffs’ contention, the Supreme Court should not have, sua sponte, declared invalid certain opt-out statements that were not part of the plaintiffs’ unopposed motion and which relief was not requested in the motion. “[A] court may grant relief that is warranted by the facts plainly appearing on the papers on both sides, if the relief granted is not too dramatically unlike the relief sought, the proof offered supports it, and there is no prejudice to any party” … . Here, the court strayed from this principle … . The relief awarded by the court, sua sponte, in the handwritten provision in the February 2018 order is “dramatically unlike” the relief sought by the plaintiffs and was prejudicial to the appellants … . Moreover, the opt-out statements referred to in the February 2018 order were not among the exhibits submitted on the plaintiffs’ motion, and therefore were not properly before the court for consideration … . Robinson v Big City Yonkers, Inc., 2020 NY Slip Op 00447, Second Dept 1-22-20

January 22, 2020/by Bruce Freeman

Arbitration, Contract Law, Employment Law, Labor Law

PLAINTIFFS WERE NOT SIGNATORIES TO CONTRACTS WHICH REQUIRED ARBITRATION OF WAGE-UNDERPAYMENT ALLEGATIONS AND PLAINTIFFS DID NOT EXPLOIT THE BENEFITS OF THE CONTRACTS; THEREFORE PLAINTIFFS COULD NOT BE COMPELLED TO ARBITRATE (SECOND DEPT).

The Second Department determined the plaintiffs in this putative class action alleging wage-underpayment in violation of Labor Law article 6 could not be compelled to arbitrate. Plaintiffs were not parties to the contracts with defendants which compelled arbitration and did not seek to exploit the benefits of those contracts:

… [U]nder limited circumstances nonsignatories may be compelled to arbitrate” … . Under the direct benefits theory of estoppel, a nonsignatory may be compelled to arbitrate where the nonsignatory “knowingly exploits” the benefits of an agreement containing an arbitration clause, and receives benefits flowing directly from the agreement … . “The benefits must be direct, and the party seeking to compel arbitration must demonstrate that the party seeking to avoid arbitration relies on the terms of the agreement containing the arbitration provision in pursuing its claim” … . Where the benefits are merely “indirect,” a nonsignatory cannot be compelled to arbitrate a claim … . “A benefit is indirect where the nonsignatory exploits the contractual relation of the parties, but not the agreement itself” … .

Here, contrary to the defendants’ contention, the plaintiffs should not be compelled to arbitrate based upon the agreements. The record does not establish that the plaintiffs were even aware of the existence of the agreements or that they knowingly exploited the benefits of the agreements … . Arboleda v White Glove Enter. Corp., 2020 NY Slip Op 00098, Second Dept 1-8-20

January 8, 2020/by Bruce Freeman