Many Employers and Insurers over the last year have had to deal with the concern of whether businesses that continue to operate during the Covid-19 pandemic will face any liability for customers and employees who may be exposed on their property to the virus. In response, the Georgia legislature passed O.C.G.A. 51-16-1, et al. providing a shield to businesses under the Georgia Tort Act that would protect businesses from claims if they complied with signage requirements putting individuals on notice that they may be exposed to the virus if they enter the premises.

Additionally, Georgia’s occupational disease statute under the Georgia Workers’ Compensation Act, as codified in O.C.G.A. 34-9-280, already contains provisions that would make it difficult for employees to successfully pursue claims for benefits under the Act since it already limits claims for exposure to diseases to those that 1) follow as a natural incident to the employment; 2)the disease is not of a character to which the employee may have had substantial exposure outside of the employment; and 3) that the disease is not an ordinary disease of life which the general public is exposed. These are three of the five requirements for successfully proving an occupation disease under Georgia law and upon analysis would all be difficult to prove given the nature of the Covid-19 virus since it is spreading openly through all communities and it is difficult to trace to a specific source for each exposure.

This article by Bloomberg news has suggested that businesses may still face frivolous litigation from plaintiff’s attorney’s willing to challenge the laws through unique facts or legal arguments surrounding the recent legislation. However, Employers and Insurers in Georgia should take an aggressive defensive position with regard to any workers’ compensation claims in Georgia if they are faced with one due to the high burden of proof put on Claimant’s for these claims.

Additionally, Employers and Insurers in Georgia should keep in mind that the Statute of Limitations for workers’ compensation claims in Georgia is one year from the date of injury. And for occupational diseases that is one year from the date the employee knew, or in the exercise of reasonable diligence, should have known of the disablement and its relationship to the employment. O.C.G.A. 34-9-281(b)(2).

You can access the article by GM Associate, Brett Tyler, by clicking HERE.

Goodman McGuffey attorney, Teri Zarrillo, is presenting at the Workers’ Compensation Educational CEU Dinner on April, 22nd from 5:00 – 7:00 PM at Maggiano’s Little Italy in Dunwoody, Georgia. Free CEU credits will be provided.

In order to comply with social distancing guidelines due to COVID-19, this event will have a limited number of attendees. RSVP’s will be first come, first serve so make sure you do not miss out!

If you are interested in attending, please click HERE to register.

Please contact Britton Farlow at Goodman McGuffey with any questions.

Featured In This Article:

Teri Alpert Zarrillo

Managing Partner

Atlanta Office

Many employees have successfully transitioned to remote working as a result of Covid-19.  Jobs that were not previously considered remote-friendly have now been proven to be fully functional remote positions.  An effect of identifying new remote areas is that those jobs may now be considered for outsourcing.  When deciding whether to outsource, companies need to consider applicable employment laws, the outsourcing model it should adopt, and the specific outsourcing company it should hire.

 There are multiple outsourcing models.  One outsourcing plan includes terminating all employees in one area of the business, such as accounting, human resources, or customer service, and retaining a company to conduct those tasks.  The main employment issue under this model is whether the employees can be terminated.  

Employees are at will in most states and can be legally terminated at any time for any reasons except for an unlawful one.  Employees can be terminated as long as there is no collective bargaining agreement or employment contract which dictates termination.  In such a case, companies must abide by the termination provisions of the agreements.

Be mindful of specific job areas that are dominated by one race, gender, age or other protected characteristic.  This would not prevent outsourcing, but the company should consider the risks of employment discrimination claims and be proactive to prevent employment discrimination claims being lodged against the company. 

Another outsourcing model requires the business to terminate the employees and the outsourcing company hires them the same day so that there is no break in employment. This usually occurs when the tasks are company specific and the employees are vital to the continuation of the work.  Generally, the employees spend months, and sometimes years, training others to do their specific job tasks.  Once the job tasks are learned by others, then the outsourcing company will either maintain the employees for another job or terminate the employees. 

Because the employees are at will, they have the freedom to determine if they want to accept the employment offered by the outsourcing company or leave altogether.  It is common for the outsourcing contract between the outsourcing company and the company to include a provision that the transitioned employees are employed by the outsourcing company for one year.  One purpose of this provision is to protect the main company from employment discrimination claims by the transitioned employees.

Most employment discrimination claims contain a statute of limitations that is a year or less than a year.  After the statute of limitations period has passed, save certain exceptions, the employees can no longer bring employment law claims against the company.  If the employee is offered employment with the same or similar pay, working conditions and benefits at the outsourcing company than the employee will have little to no damages even if the employee could prove discrimination.  If the employee refuses to accept the position with the outsourcing company, there is an argument that the employee failed to mitigate his or her damages again rendering little to no damages.  If the outsourcing company terminates the employee after one year, the employee can no longer bring an employment discrimination claim against the main company save certain exceptions.

The outsourcing contract should be drafted to minimize the risks of a finding that the main company and the outsourcing company are joint employers to the employees.  If there is a finding of joint employment, the company could continue to be liable for employment related claims brought by the employees.  In addition to a strongly drafted outsourcing contract, the employees should be under the sole control and management of the outsourcing company once they are transitioned to the outsourcing company to avoid joint employment problems.

For all outsourcing models, the company is trading people for products.  The company will no longer employ individuals who do the work.  The company will pay for the services from another company.  This saves on labor costs, avoids many potential employment claims and other forms of possible liability. As a tradeoff, the company cannot control the work, it loses intimate knowledge of the details of the jobs and it must add procedures and steps to avoid any data breaches or privacy violations.  Be careful not to exchange quality for the cost savings.

Businesses should hold themselves morally accountable for the actions of the outsourcing company.  It is important to vet the outsourcing company prior to any engagement.  The outsourcing company with the lowest rates should not necessarily be the company hired.

You can access the article by Sara Blackwell HERE.

Following a confidential settlement with ex-cheerleaders, the Washington Football NFL Team announced on Wednesday that the cheerleaders will be replaced by a coed dance squad. In recent years, several football teams have added men to their cheerleading squads following lawsuits alleging members were subject to sexual harassment and being underpaid.

Goodman McGuffey partner, Sara Blackwell, who represented former cheerleaders in complaints against the New Orleans Saints and New York Jets, said adding men is a “great idea” but doesn’t solve long-standing problems. She also suggested the team is protecting itself from potential gender discrimination suits in the future. “You can change the name. You can change the performance,” Blackwell said. “But it’s the treatment of the cheerleaders that needs to be better.”

You can read the entire article on the Washington Post HERE.

Less than a month after President Biden fired NLRB General Counsel Peter Robb, Biden has nominated Jennifer Abruzzo as the next GC of the NLRB. As you may recall, Biden fired Peter Robb after Robb declined to comply with Biden’s ultimatum that he resign or be terminated. The story goes that minutes after Biden’s inauguration, Robb received an email requesting his resignation and notifying him that failure to comply would result in termination.

Jennifer Abruzzo currently serves as Special Counsel for Strategic Initiatives for the Communications Workers of America. Previously, Abruzzo was Acting General Counsel at the NLRB. Abruzzo has a long history of working at the NLRB, including working as a field attorney, supervisory field attorney, deputy regional attorney in the Miami office, and Deputy Assistant General Counsel.

Prior to Abruzzo’s nomination, NLRB Acting General Counsel Peter Sung Ohr has rescinded numerous advice memos issued by the Trump Board, which is a signal that the Biden administration intends to keep its promises related to union rights, especially with the PRO Act’s passage in the House of Representatives during the first week of November. While it is not expected that the bill will gain any headway in the Republican controlled Senate, the actions of Peter Sung Ohr and the appointment of Jennifer Abruzzo ensures that employers will have an interesting four years as it is expected that union activity will increase dramatically. Throw in the passage of the PRO Act, which would dilute right-to-work laws, and unions could gain significant control in the American workplace.  

Perhaps one of the most interesting questions facing Biden’s replacement of Peter Robb is whether or not Robb’s termination is constitutional. In fact, just two weeks ago, United States Senators Rand Paul, Tom Cotton, Rick Scott, and Mike Braun sent Biden a letter condemning his termination of Peter Robb as unconstitutional because “for cause removal applies to term-limited political appointees at quasi-judicial agencies, even if they perform substantively executive functions within those agencies.”

Although Biden’s nomination of Abruzzo is still pending, one thing is certain: Biden will keep his promise to unions that he made during the 2020 election campaign. Employers can expect an increased union presence over the next four years. Most notably, the shift in political power at the administrative level will lead to an uptick in union elections and unfair labor practice charges filed against employers resistant to the change. We will keep you abreast of any new updates relating to changes at the NLRB or the PRO Act.

Click HERE for the PDF.

On Friday, February 19, 2021, the United States Department of Labor announced that prior opinions by Donald Trump’s Department of Labor relating to gig workers were withdrawn. Specifically, the Wage and Hour Division (“WHD”) withdrew two letters that strengthened employers’ arguments that gig workers, like those who drive for Uber or deliver for DoorDash, are independent contractors. As independent contractors, these individuals would not be entitled to minimum wage or overtime protections under the Fair Labor Standards Act (“FLSA”).

            The two letters[1] that were withdrawn include FLSA 2021-8, which addressed whether “certain distributions of a manufacturer’s food products are employees or independent contractors  under the FLSA”, and FLSA 2021-9, which addressed whether “requiring tractor-trailer truck drivers to implement safety measures required by law constitutes control by the motor carrier for purposes of their status as employees or independent contractors under the FLSA, and whether certain owners-operators are properly classified as independent contractors.” The notice of withdrawal by the WHD simply states “WHD is withdrawing opinion letters FLSA2021-4, FLSA2021-8, and FLSA2021-9. These letters were issued prematurely because they are based on rules that have not gone into effect. This withdrawal is an official ruling of the Wage and Hour Division for purposes of the Portal-to-Portal Act, 29 U.S.C. § 259, and these letters may not be relied upon as statements of agency policy as of the date of withdrawal.”

            This is a large blow to employers like Uber or Lyft that hoped to use the opinion letter in litigation that is expected to takeoff in the next few years. To highlight, the opinion letter contained the following example of “control”:

Distributors are free to set their own schedule to the point of not needing to be present to accept shipments from the manufacturer and refusing meetings with the company rep. Indeed, they may refuse to participate in company reps’ meetings with retailers, refuse to participate in the manufacturer’s suggested marketing, and refuse to participate in the manufacturer’s promotions. Distributors decide the beginning and end of their workdays, including when they make sales calls, how often they make them, and in what order, for their own independent business reasons’ the manufacturer does not dictate their schedule. And though it would not be a recommended business practice, a distributor could even stop doing business with a retailer that wanted the distributor to operate on a different schedule.

Replace distributor with driver and replace retailer with ride share company, then read it again. Sounds a bit like . . . Uber/Lyft/etc., right? The WHD’s withdrawal of this letter was a big hit and was only a taste of what employers can expect over the next four years from the Biden administration.

This decision by the WHD is at the forefront of what will most likely be a big year for gig workers in the battle of employee classifications. The decision comes a month after the Service Employees International Union (“SEIU”), on behalf of gig workers, filed suit in the California Supreme Court, and later the Alameda County Superior Court, alleging that Proposition 22 violates the state constitution and impedes the power of legislators to enact measures designed to protect employees. As a reminder, Proposition 22 exempts companies like Uber and Lyft from classifying their drivers as employees, while requiring that drivers receive certain other benefits. 

            Gig workers are also gaining ground in other parts of the world. On February 19, 2021, the U.K.’s Supreme Court affirmed lower court rulings that found drivers involved in the case were workers and not independent contractors. The court focused on the drivers’ “position of subordination” relative to demands that Uber places on its drivers.

In letters unrelated to gig-workers, on Friday, February 19^th, the WHD issued letters FLSA2021-6[GN1] , which addresses “whether the FLSA’s ‘retail or service establishment’ exception applies to staffing firms that recruit, hire, and place employees on assignments with client, and FLSA2021[GN2] -7, which addresses whether “certain local small-town and community news source journalists are creative or learned professionals under Section 13(a)(1) of the FLSA.

[1] Although unrelated to gig workers, the WHD also withdrew FLSA2021-4, which addressed whether “a restaurant may institute a tip pool under the FLSA that includes both servers, for whom the employer takes a tip credit, as well as hosts and hostesses, for whom a tip credit is not taken.

You can access this article by Graham Newsome HERE.

James Hankins and Samantha Mullis recently won summary judgment in a case involving an off-the-clock employee driving drunk causing an automobile collision. In Bartholomew Ikemna v. Dean Electric Company, Inc. and Shannon Fox, Mr. Ikemna filed suit against Dean Electric Company and one of its former employees asserting that Dean Electric Company was vicariously liable for Mr. Fox’s actions and guilty of negligent hiring, training, supervision, and entrustment.

After completing discovery, James and Samantha filed for summary judgment, arguing that Mr. Fox was not on the job at the time of the collision and was outside the scope of his employment by driving intoxicated. James and Samantha further argued that there was nothing in Mr. Fox’s driving or employment history that would show a pattern of reckless driving and that Dean Electric Company lacked actual knowledge of Mr. Fox’s incompetence to drive. In response, Mr. Ikemna argued that Mr. Fox was acting within the scope of his employment because he was allowed to retain the vehicle for the duration of the job assignment and that Dean Electric’s hiring procedures were unreasonable. Dean Electric pointed out that the collision occurred more than seven hours after Mr. Fox had clocked out for the day and that he was not furthering its business by driving while intoxicated.

Ultimately the Court found that Mr. Fox was outside the scope of his employment at the time of the collision and that Mr. Ikemna failed to show that Dean Electric knew or should have known of Mr. Fox’s tendencies to drive under the influence. You can read more on this case by clicking HERE.

Featured In This Article:

James T. Hankins, III

Partner

Atlanta Office

Goodman McGuffey LLP attorneys, Robert. E Noble III, and Robert A. Luskin won summary judgement for Noodle Life, a closely held family corporation, in a restaurant liability matter involving soup spilled into the plaintiff’s lap. This case turned more complex when allegations of Alter Ego, Agency, Joint Venture and attempts to pierce the corporate veil were injected into the litigation. 

Both Robert Luskin and Bert Noble practice in the firm’s Atlanta, GA office covering a wide range of restaurant, hospitality, and other litigated matters. The Order Granting Summary Judgment can be accessed by clicking HERE.

Goodman McGuffey partner, Robert Luskin, and associate, Mark Henkle, are both active members of DRI and helped contribute to the Georgia (Luskin) and North Carolina (Henkle) portions of the Annual 50-State New Employment Laws Compendium recently published by DRI. This Compendium showcases how the states took various approaches to several new laws enacted due to the effects of the pandemic, as well as other trends including the expansion of the CROWN Act, the annual minimum wage increases, and more.

The Compendium is available to view on the DRI Community page for any DRI members, HERE.

Robert Luskin currently serves on the steering committee of the DRI Employment Labor and Law committee and is an experienced trial lawyer representing clients in a wide range of insurance matters and employment litigation in Federal and State Courts across Georgia and the Southeast working out of our Atlanta, GA office.

Mark Henkle is an experienced attorney representing clients in a wide range of areas including insurance, auto-bodily injury, construction, and employment claims in North Carolina in both state and federal courts working out of our Charlotte, NC office.

Goodman McGuffey LLP is excited to announce that three of our attorneys have been named to the 2021 GA Super Lawyers list including 2 of our Atlanta-based attorneys and 1 Savannah-based attorney.

Each year, Super Lawyers selects attorneys from more than 70 practice areas through a combination of peer nominations, evaluations, and independent research. Each attorney is then evaluated on a number of indicators including peer recognition and professional achievement. Only 5% of lawyers in the state are recognized as Super Lawyers and only 2.5% of the lawyers in the state are recognized each year as Rising Stars. For more information on the selection process, please click HERE.

The Goodman McGuffey attorneys recognized as 2021 Georgia Super Lawyers are:

1. Wade McGuffey – Workers’ Compensation
2. Peter Muller – Personal Injury – General, Employment Litigation, Construction Litigation, Civil Litigation
3. Robert Luskin – Professional Liability, Employment Litigation, Insurance Coverage

Congratulations to these talented attorneys!!

Featured In This Article:

C. Wade McGuffey, Jr.

Founding Partner

Atlanta Office, Orlando Office

Peter D. Muller

Partner

Savannah Office