by admin | May 1, 2019 | Employment Law, Nevada Law, Uncategorized
By Jennifer McMenomy
Make Sure it Complies with the Fair Labor Standards Act
Many employers understand the value of giving back to their communities and realize the benefit of visibility within their communities. Thus, an increasing number of employers are following the new trend of implementing optional community service programs within their companies. In an employer-sponsored volunteer program, the employer allows employees to volunteer for a certain number of working hours each year or each month while providing the workers with the compensation they would have received for being on the job. In some instances, employees may volunteer during non-working hours and still receive some type of monetary award. These can include bonuses or non-monetary awards such as a party or other fun outing or activity.
In an employer-sponsored volunteer program of this nature, the employer may either sponsor a volunteer outing or outings in which employees can participate. Alternatively, businesses may allow employees to participate in a volunteer activity they have chosen for themselves. Such a program can have a significant benefits for both employees and employers, including improved morale at the work place, increased involvement and contributions in the community, and visibility within the community. However, it is wise to be cautious in the implementation of a volunteer program within any business or workplace.
A March 14, 2019 Opinion issued by the Wage and Hour Division of the United States Department of Labor addresses such programs and how they have the potential to violate the Fair Labor Standards Act (FLSA). The Opinion provides that “Congress did not intend for the FLSA ‘to discourage or impede volunteer activities,’ but rather to ‘prevent manipulation or abuse of minimum wage or overtime requirements through coercion or undue pressure upon individuals to ‘volunteer’ their services.’”
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by admin | Jan 5, 2019 | Allison MacKenzie, Marketing, Nevada Law
The Right of Employees to Bring Lawsuits for Unpaid Wages: What Every Business Should Know.
By Emilee Sutton
On December 7, 2017, the Nevada Supreme Court issued a decision settling a previously unanswered question under Nevada law that directly impacts Nevada employers; namely, whether employees have a private right of action against their employers to recover unpaid wages under Chapter 608 of the Nevada Revised Statutes. The Court answered that question in the affirmative and clarified years of conflicting caselaw and ambiguity.
Chapter 608 of the Nevada Revised Statutes governs the payment and collection of wages, as well as other benefits of employment. Specifically, NRS 608.016 governs the failure to pay overtime wages, NRS 608.018 governs the failure to timely pay all wages due and owing, and NRS 608.020 through 608.050 govern payment upon termination. In addition, NRS 608.180 specifically grants the Labor Commissioner power to enforce the professions described in NRS 608.005 to 608.195. However, the wage and hour statutes are silent as to whether an employee has a private right of action to enforce their terms.
Under Nevada law, if a statute does not expressly mention whether an individual may privately enforce one of its terms, an individual may only pursue his or her claims if a private right of action is implied. In the case of Baldonado v. Wynn Las Vegas, LLC, the Nevada Supreme Court examined whether NRS 608.160, which prohibits employers from taking employee tips, implies a private cause of action to enforce its terms. The court concluded that, “in light of the statutory scheme requiring the Labor Commissioner to enforce the labor statutes and the availability of an adequate administrative remedy for those statutes’ violations, the Legislature did not intend to create a parallel private remedy for NRS 608.160.” Thus, the court found “appellants…failed to overcome the presumption that no private cause of action was intended.” However, in a footnote, the Baldonado court opined, “a private cause of action to recover unpaid wages is entirely consistent with the express authority under NRS 608.140 to bring private actions for wages unpaid and due.”
In relevant part, NRS 608.140 provides that “[w]henever an…employee shall have cause to bring suit for wages earned and due according to the terms of his or her employment, and shall establish by decision of the court or verdict of the jury that the amount for which he or she has brought suit is justly due,” the court shall allow the plaintiff to recover reasonable attorneys’ fees incurred for bringing suit, along with the amount found due for wages and penalties. In light of the Baldonado footnote, employees bringing suit for unpaid wage claims against employers in district court attempted to bootstrap a private right to enforce other provisions of Chapter 608.
The Baldonado footnote spawned significant discussion by courts and resulted in conflicting decisions. For example, the United States District Court for the District of Nevada found that “§608.140 does not imply a private right of action to enforce the labor statutes…Instead, §608.140 implies a private right of action to recover in contract only.”
In a separate case, the court also found, “NRS 608.140 does not create a vehicle for privately enforcing the legal rights conferred by the other provisions of Chapter 608; it merely establishes a fee-shifting mechanism in an employee’s ‘suit for wages earned and due according to the terms of his or her employment.’”
Nearly ten years after Baldonado was decided, the Nevada Supreme Court finally put the issue to rest when John Neville, Jr. filed a petition for a writ of mandamus challenging the district court’s dismissal of his NRS Chapter 608 wage claims on the basis that no private right of action exists. Mr. Neville was employed as a cashier at a Las Vegas convenience store owned by Terrible Herbst, Inc. Terrible Herbst enforces a time-rounding policy whereby it rounds the time recorded and worked by all hourly employees to the nearest 15 minutes for the purposes of calculating wages. As a result of the time-rounding policy, Mr. Neville alleged he did not receive wages for work actually performed.
On appeal, the Nevada Supreme Court discussed the Baldonado footnote and found that NRS 608.140 demonstrates the Legislature’s intent to create a private cause of action for unpaid wages. The Nevada Supreme Court stated, “[i]t would be absurd to think that the Legislature intended a private cause of action to obtain attorney fees for an unpaid wages suit but no private cause of action to bring the suit itself.” Because Neville’s Chapter 608 claims involved allegations that wages were unpaid and due, and he tied his Chapter 608 claims with NRS 608.140, the Nevada Supreme Court found Neville properly stated a private cause of action for unpaid wages.
In light of the Nevada Supreme Court’s decision in the Neville case, there will likely be increased numbers of employees bringing civil lawsuits – including class actions – in Nevada courts for unpaid wages and attorneys’ fees. Because of the unknown outstanding financial obligation to employees and the significant costs of litigation, it is crucial that Nevada employers comply with Nevada’s wage and hour requirements. Employers are advised to consult with qualified legal counsel to ensure the adoption of policies and practices that comply with NRS Chapter 608.
See the article at: NNBV
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by admin | Dec 18, 2018 | Allison MacKenzie, Nevada Law
What They Are and How They Are Enforced!
by Jennifer McMenomy
In general, when parties enter into a contract, they do not contemplate potential legal disputes arising in the future. However, it is important for parties to outline how they will handle a contractual dispute if one does occur. Including an arbitration clause in a contract will help to eliminate some of the litigation costs and uncertainties that may transpire if a dispute over a contract should develop.
A mandatory arbitration clause is a provision contained within a contract that states that all legal disputes between the parties to the contract will be settled through the process of arbitration. Arbitration clauses are very common and can be found in various types of business contracts including: purchases for goods or services, employment contracts, construction contracts, etc.
Many sophisticated parties and businesses include a mandatory arbitration clause in their contracts because it enables them to settle legal disputes regarding the contract quickly, quietly and without the expense of litigation.
Arbitration is the process of settling a legal dispute between two or more parties using an impartial third person. Therefore, if a dispute arises regarding a provision of the contract that cannot be resolved between the parties themselves, the parties will present their issues to an arbitrator, or neutral third party, instead of through traditional litigation proceedings.
There are many professional arbitrators and organizations that parties may choose from. Some of these specialize in the specific area of the law or business issue. The selection process may be (but is not necessarily) specifically included within the language of the arbitration clause. Generally, the arbitration clause will outline who pays for the arbitration, whether each pays half of the cost of the arbitrator and their own attorney’s fees or whether the non-prevailing party pays these expenses.
Generally, an arbitration clause will state where the arbitration will take place and what law will govern the dispute, should one arise. For instance, if a contract is entered into in Nevada, the arbitration clause will likely state that the contract dispute must be arbitrated in Nevada. It is very important to include within the mandatory arbitration clause, the state and/or location of where the arbitration must take place and the governing law within the arbitration clause to avoid confusion and conflict.
If there is not a specific provision within the contract regarding which law applies, then depending on the nature of the contract, the arbitration clause may be governed under federal or state law. The Federal Arbitration Act (FAA) governs agreements where the contract involves a transaction that crosses state lines, also known as “affecting interstate commerce.”
If the contract does not deal with interstate commerce, then state law will apply. There are several factors to take into consideration when determining exactly which state law applies; however, for the purposes of this article, it is assumed that Nevada law will apply to the arbitration clause.
If the arbitration provision in the contract is governed by Nevada law, there are some specific requirements that must be met before the provision is enforceable. Nevada Revised Statutes (NRS) Chapter 38 governs arbitration provisions within contracts. In Nevada, arbitration agreements between parties to a contract are favored as a matter of public policy because they allow for judicial economy and ease the burden of the courts.
While arbitration agreements are favored, Nevada law sets a higher standard of enforcement for arbitration clauses contained within contracts than most states and the FAA. NRS 597.995(1) requires “specific authorization” of the arbitration clause by each of the parties to the contract.
If “specific authorization” is not provided by the parties, it can render the arbitration clause void and unenforceable. If a mandatory arbitration clause is found to be unenforceable or void, a party can choose to litigate the dispute through the court system and is no longer bound by the contract to arbitrate its claims.
While the statute does not expressly state what “specific authorization” means, the Nevada Supreme Court has given some idea of what constitutes specific authorization under NRS 597.995(1). In Fat Hat, LLC v. DiTerlizzi (2016), the Court found that a signature of a party to the contract on the general signature line at the end of the contract did not meet the specific authorization requirement.
The Court found that, even though the arbitration agreement contained within the contract was right above the signature line, it did not constitute specific authorization. While this case is unpublished and therefore is not controlling in future cases, it may be persuasive as to how a court will view the statutory specific authorization requirement.
To ensure that Nevada’s specific authorization requirement is met, it is important that an agreement includes an additional signature or initial line directly below the arbitration clause to ensure that each party assents to the arbitration clause. By including an additional signature or initial line to the arbitration provision the “specific authorization” requirement will likely be met and ensure that the arbitration clause within the contract is enforceable.
The take away…in order to ensure that an arbitration provision is enforceable, the contract must include the following:
The arbitrator or group identified to arbitrate the dispute;
Who will pay for the legal and arbitrator fees;
The governing law that is to apply to the contractual dispute;
A signature or initial line set apart from and directly below the arbitration provision to ensure that the “specific authorization requirement is met.”
It is recommended that you seek the assistance of knowledgeable legal counsel in developing and reviewing these clauses in order to protect the future of your business dealings should a conflict arise.
See the article at: Northern Nevada Business View.
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