Be Careful Who You E-mail on Your Employer’s Computer

Anthony Davis wrote an article in the New York Law Journal on November 4th summarizing the state of the law with regard to privacy matters when one is using his work computer to send personal e-mails.

A New York decision,  Scott v. Beth Israel Medical Center Inc., 2007 WL 3053351 (N.Y. Sup. Oct. 17, 2007), held that if you send e-mails to your attorney, even using your personal e-mail account like gmail or aol.com, on your employer’s computer, you may have waived your right to invoke your “attorney-client privilege” with regard to that e-mail. If the employer had a privacy policy in place, that employee’s were notified of, that the employer had the right to access any information an employee transmits using the employer’s computer.

The Scott court also held that even if the attorney had a standard notice at the bottom of each e-mail that the contents of the e-mail were to be private between the attorney and the client, that such notice is ineffective to save the communication from the client’s constructive waiver of the privilege resulting from the client’s decision to use his office computer to communicate with his attorney. Thus, the court suggested that attorneys should advise their clients that they should not use their office computers for communications between them, especially if the attorney feels that there is some risk that the employer might have a motivation to look into the employee’s personal e-mails.

On the other hand, a New Jersey court, in  Stengart v. Loving Care Agency Inc., 973 A.2d 390 (N.J. Super. A.D. July 29, 2009), came to the opposite conclusion. In that case, the court held that even an employer’s e-mail policy granting it access to all employees’ e-mails on their computers, will not be valid to waive the employee’s attorney-client privilege. The employer-defendant in that case has appealed that case to the New Jersey Supreme Court, which just heard arguments on the case. When that court comes to a decision in the matter, at least New Jersey will have come up with a definitive conclusion on the matter.

For the time being, in New Jersey, and especially in New York, you should not send any e-mails, using one’s work computer, that you would like to keep private. This is especially true if you are writing your attorney regarding a case against the employer on whose computer you are sending the e-mail.

It is better to either wait until you have access to your home computer after work to send private e-mails, or to use a cell phone, iPhone, or (privately owned) Blackberry if you have to send private e-mail during business hours.

As always, if you need help with any kind of personal injury, contract, or other litigation, you can call our office 24/7 at 800-344-6431 or send us an e-mail (not necessarily on your boss’ computer!)

Picture courtesy of The Office Rat.

Reporting Employer-Provided Health Insurance Benefits as Income

Many employers in New York employ those with a relatively low salary. Both the employer and the employee may be concerned that the employee remain eligible for the Child Health Plus health plan, WIC, free and reduced cost lunch programs, and food stamps. Thus, they both have an interest in making sure that the employer does not erroneously report too much income for the employee on pay stubs and W-2 forms, which may negatively affect the employee’s eligibility for these programs.

For example, does the employer have to report health insurance contributions made on behalf of the employee as part of the employee’s gross pay?

An employer must give the employee, with every paycheck, a statement (pay stub) indicating (1) the employee’s gross wages, (2) deductions from salary for taxes, benefit contributions, etc., and (3) net pay. NY Labor Law § 195(3).

In order to understand which wages and non-cash benefits an employer must report as gross income to the employee, we must first understand whether § 195(3)‘s requirement to specify the employee’s “gross wages” means that the employer must report the health plan contributions it made on the employee’s behalf.

The NY Labor Law Definitions do not define either “wages” or “gross wages.” Therefore, we turn to how the Internal Revenue Code defines “wages.” 26 USC § 3401(a)(21)  says that “wages” means all remuneration an employer gives to an employee, including the cash value of non-cash benefits except for, among other things, payments made for the benefit of an employee if the non-cash benefit would not be included in the employee’s gross income under 26 USC § 106(b).

§ 106 says that generally, “gross income of an employee does not include employer-provided coverage under an accident or health plan.” U.S. Tax Court judges have interpreted this section to mean that payments by an employer to reimburse an employee for medical expenses or pay the employee’s health insurance premiums are not included in the employee’s gross income. Schmidt v. Comm’r, 2003 WL 22790862, *6 (T.C. Nov. 25, 2003). An earlier Tax Court clarified that “[s]ection 106 provides that an employee’s gross income does not include employer-provided coverage (e.g., accident and health insurance premiums) under an accident and health plan.” Rugby Productions Ltd. v. Comm’r, 100 T.C. 531, 535 (T.C. 1993).

Oddly, payments made directly to an employee  for “personal injury or sickness” by a health plan which are attributable to an employer provided health insurance plan are  included in the employee’s gross income. 26 USC § 105(a). But if the employee laid out the money directly and is being reimbursed for those payments by the health plan, then the reimbursements are not included in the employee’s gross income. 26 USC § 105(b).

Thus, because health insurance premium payments by an employer are not counted towards the employee’s “gross income,” they should not need to be listed as part of the employee’s “gross wages” under the NY Labor Law pay stub requirement mentioned above.

Standard disclaimer applies. But as always, if you need assistance with any kind of legal issue, whether it be Matrioninal/Family Law, Bankruptcy, Personal Injury, Wills, Trusts, & Estates, Real Estate, or Criminal/DWI,  you can always contact us by e-mail or calling 800-344-6431.

Picture courtesy of About.com.

Jewish Groups Support Reversal of NY Court’s Nullification of Rabbinic Arbitration Decision

As reported here, and as Mitchell Rubenstein predicted, the Appellate Division of the Supreme Court will consider a teacher’s appeal of a Kings County Supreme Court’s nullification of a rabbinical arbitration panel’s decision in an employment case.

Following a dispute between the Hebrew Academy of Five Towns and Rockaway and one of its teachers, Nachum Brisman, regarding the school’s decision to terminate his employment, both sides agreed to have their dispute arbitrated by a well-known rabbinic panel, the Beth Din of America. The rabbinic panel’s arbitration decision favored the teacher in the dispute and when the teacher brought the decision to the Kings County Supreme Court to enforce the decision, it instead vacated it. Judge Balter’s decision can be read here.

Now, Brisman has appealed the lower court’s vacature of the arbitration before the Appellate Division. Three major orthodox Jewish organizations, the Orthodox Union, Agudath Israel of America, and Torah U’Mesorah, joined together last week to file a “Friend of the Court” brief, arguing that the Appellate Division should reverse Judge Balter’s vacature of the arbitration panel’s decision.

You can read the amicus brief here.

The organizations’ amicus brief emphasized that their support of Brisman’s appeal “should not be construed as advocacy on behalf of either party with respect to their underlying claims.” Rather, they clarified in the brief that they are advocating for the reversal of the Supreme Court’s vacature of the rabbinic arbitration agreement in order to prevent the weakening of the rabbinic arbitration system in general.

Indeed, it is difficult to fathom how the court could nullify an arbitration decision that both parties had agreed in advance to abide by. Such a decision seems to encourage the losing party in any kind of arbitration decision to appeal any decision if he knew that the state courts would vacate any decision that the losing party was unhappy with, as long as he could convince the court that the arbitration panel’s decision is “irrational.”

We will see if the Appellate Division agrees. Update 2/19/10: It does!

Picture courtesy of vosizneias.com

New IRS Form I-9 For Employers Starting April 3rd

Adjunct Law Prof Blog just posted that employers who hire an employee must verify their legal status to work and fill out the new I-9 form.  Employers must have the employee sign the form within three days of starting work. It would be wise to see the form and instructions right away, if you haven’t already done so. Those items are available here.

Oprah’s Car Giveaway & Awarding Additional Taxes in ADA Suit

Paul L. Caron at the TaxProf Blog  reported on an interesting 3rd Circuit case, Eshelman v. Agere Systems, Inc. Basicially, an employer fired an employee in violation of the Americans With Disabilities Act (the “ADA”). The District Court, the trial court, held that the employer had to pay not only the back pay it owed to the employee, but also had to pay an additional amount to cover her additional taxes. Since the lump-sum back-pay payment would put the employee into a higher tax bracket than she would have otherwise been in had she been continuously employed the whole time, the District Court ruled that the employer had to pay the additional amount the employee would have to pay in taxes.

The 3rd Circuit affirmed this ruling, holding that the only way the employee could be “made whole” for the pay she should have received but didn’t because she was fired illegally, was to have her additional taxes paid by the employer as well. Otherwise, because of the higher tax rate that she would have paid at the time of the back-pay payment, she would end up with less than she would have, if she’d been paid smaller amounts over a longer period of time.

Giving an employee back pay, but forcing her to pay extra taxes because of it, reminds me of the time Oprah Winfrey gave everyone in her audience both a new car, and an obligation to pay income taxes on the receipt of that car. They had to either come up with up to $7,000 of their own money to pay for the income taxes on the car, forfeit the right to get the car, or sell the car (at a used car price) to pay the taxes, and keep the difference.

Thanks but no thanks. I can definitely see the logic behind awarding an employee an additional amount to pay the higher-bracket taxes on the back pay. If you’re going to give someone money or something of monetary value, whether as a gift or because you have to, it’s only fair that you also pay the additional tax liability you’re causing the person by giving the gift/money!

New Layoff Notice Requirements in New York

WorkforceManagement.com reported yesterday that a new law is now in effect in New York that requires many employers to give more notice to employees to be laid off, than previously required.

Currently, under the Federal government’s WARN statute, “most employers with 100 or more employees [are required to] to provide notification 60 calendar days in advance of plant closings and mass layoffs.”

In a move likely to make employers more hesitant to hire new employees, New York has enacted the stricter “Worker Adjustment and Retraining Notification Act” as of this past Sunday, February 1st. “The New York law applies to businesses with 50 or more full-time workers… when at least 25 employees lose their positions, if they make up one-third of the workforce, or when a company lays off at least 250 full-time employees.”

According to Workforce Management, “[t]he Business Council of New York State says some 13,000 small businesses that weren’t affected by the federal statute will now be covered by the state law.”

I understand that there are good intentions behind this law. As someone who was once laid off with three hours notice, and a family to support, I definitely understand the workers’ and unions’ position on this. But I think that it will have an overall undesirable effect on workers and employees.

In countries with stringent requirements like France, laws like these create a pressure on employers not  to hire new employees. The more a society chips away at the concept of at-will employment, the more hesitant companies, large and small, become in hiring new employees, because they know how difficult it will be to fire them if the need arises. Thus, France’s unemployment rate is worse than the United States’.

It will be interesting to see what affect the new law has.

Putting a “Religion Clause” in Your Will or Trust

The Illinois State Supreme Court will soon consider the case of In re Estate of Max Feinberg. With thanks to John T. Brooks from T&E.com, I found this interesting case. Max and Erla Feinberg created a trust with their substantial assets to care for their children and grandchildren. They placed a provision in the trust that if any of their five grandchildren married outside of the Jewish faith, unless their spouses converted to Judaism within one year of marriage, they were not to benefit from the trust at all. Only one of the five grandchildren actually married within the faith.

The numerous adversely affected parties sued, arguing that the “Jewish Clause” created an unconstitutional restraint on marriage, and should not be enforced by the court, because it violates public policy. In accordance with the majority of the cases that related to similar clauses in Wills and trusts throughout the country, the trustees argued that since the grandchildren were still able to marry many people, it was only a “partial restraint on marriage,” and the Clause should be enforced.

Both the trial court and the Illinois appeals court held that that the clause was unenforceable and violated public policy. They argued that even though the trend until recently has been to enforce such clauses because they are only “partial restraints” on marriage, since the authors of the Restatement (Third) of Trusts §29 (2003) approves breaking with that legal tradition and supports voiding any, even partial, restraint on marriage, they would do so as well.

Given the vociforous debate between the majority and dissenting opinions in this case, the Supreme Court of Illinois may hear the case. The case was on the Court’s 11/18/08 “Leave to Appeal” docket, but I can find no record regarding whether they have agreed to hear the case.  Given that the current cases in the Illinois courts attempt to reverse the general trend that American courts have traditionally validated these “religion clauses,” it will be interesting to see whether the tide has turned, or whether the Illinois court is going to be the “odd man out” on this issue.

It would make sense for anyone making an estate plan, with or without a “religion clause,” to consult with an attorney who is competent in these matters and can advise you of the latest developments.

Picture courtesy of the ChicagoJewishNews.com

When Can the Police Pat You Down?

As an appropriate follow up on this post from Monday about the Court of Appeals, Second Circuit’s decision a few days ago, the Supreme Court ruled on Monday about a related matter. In Arizona v. Johnson, the Supreme Court released a unanimous decision clarifying when a “pat down” for weapons is or is not in violation of the 4th Amendment prohibition against unreasonable searches and seizures.

In the case, a police officer pulled over a car for a routine traffic violation. After noticing some gang related clothing and unusual behavior by the passenger in the back seat, she began conversing with him and he revealed his gang affiliation with the Crips. She asked him to get out of the car, and fearing for her safety, she patted him down, whereupon she found a gun he was illegally possessing. Later on, this individual’s attorney moved to suppress the gun evidence, arguing that the pat down was an unreasonable search and seizure since she had no reasonable suspicion that he had or was about to engage in some criminal activity. All she had was a suspicion for her safety. The trial court allowed the evidence but the Arizona Court of Appeals said that since her suspicions were the result of a consensual conversation, the stop was no longer part of the traffic stop and that the officer therefore lost her ability to pat him down for fear of her own safety, barring a reasonable suspicion of criminal activity, which was absent in this case.

The Supreme Court reversed this Arizona Court of Appeals decision, and let the Trial Court’s decision to allow the pat down stand. They argued that “[a]n officer’s inquiries into matters unrelated to the justification for the traffic stop do not convert the encounter into something other than a lawful seizure, so long as the inquiries do not measurably extend the stop’s duration.”

As Professor Orin Kerr (one of the authors of my Criminal Procedure Casebook!) emphasizes in his post at The Volokh Conspiracy, “[t]he temporary seizure of driver and passengers ordinarily continues, and remains reasonable, for the duration of the stop. Normally, the stop ends when the police have no further need to control the scene, and inform the driver and passengers they are free to leave.” (emphasis added).

Combined with the 2nd Circuit’s decision on Monday, in New York, as long as the police stop a car for a traffic violation, and then see something that makes them suspicious that the occupants may have a weapon, they may pat down the occupants of the car and search the car if there’s some reasonable basis to think that illegal activity has or is about to take place.

These recent developments and decisions make it even more important to get a lawyer who understands the intricacies and the new developments in criminal procedure  regarding what the police may and may not do in a traffic stop, if you get stopped for a DWI, or any other reason…

Picture courtesy of…

NY Court’s Vacature of Rabbinical Arbitration Decision Ripe For Appeal

Mitchell Rubenstein, Senior Counsel at NYS United Teachers and an adjunct professor at St. John’s Law School, has some interesting comments on this recent King’s County Supreme Court decision to vacate a rabbinical court arbitration decision in an employment matter.

In Brisman v. HAFTR, a teacher was fired. Claiming wrongful termination, both sides agreed to arbitrate the matter in the rabbinical court, Beth Din of America.  The rabbinical court made its decision and the school appealed it. For more details on why the New York court vacated the arbitrator’s decision, you can read the details, quoted from the New York Law Journal, on the Adjunct Law Prof Blog’s post on the subject.

According to Mr. Rubenstein, this case is ripe for appeal, should Mr. Brisman decide to take it to the Appellate Division because the court innappropriately reviewed the merits of the arbitrator’s decision (a  big no-no) and also because it got involved in matters of religoius law, another big no-no.

Update 2/19/10: Judge Balter’s vacature of the arbitration decree has be overturned!

Picture courtesy of thomasmoore.org

Attorney Representation of Badly Treated Immigrant Para-Medical Workers

I read this post by Jeff Lipshaw from the Legal Profession Blog with great interest. This is especially so because our law office is currently handling almost the exact same kind of case. Lipshaw was discussing a recent Law Review article on the topic entitled: Lawyer’s Worst Nightmare: The Story of a Lawyer and His Nurse Clients Who Were Both Criminally Charged Because the Nurses Resigned En Mass.

The abstract of that article, as quoted in the Legal Profession post is as follows:

Imagine that a group of foreign registered nurses approach their lawyer because they feel abused and want to quit their jobs. They signed an employment contract agreeing to remain employed for three years and are unsure of their rights. The contract that they signed also contains a $25,000 liquidated damage provision. The lawyer advised his clients that they have to right to quit, and after they quit, the lawyer and his clients find themselves at the center of a massive criminal and civil controversy. Both the lawyer and his clients are criminally charged with endangering the welfare of critically ill pediatric patients and related crimes because the nurses resigned en masse without notice. You might think that such a case could not arise in Twenty-First Century America, but in 2007 that is exactly what occurred in Suffolk County New York and resulted in a New York appellate court having to prohibit the criminal prosecution of both the nurses and their attorney. Matter of Vinluan v. Doyle, ___A.D.3d___, 2009 WL 93065 (2d. Dep’t. Jan. 13, 2009).

This Essay examines this troubling case, where the court held that such a prosecution offended the Thirteenth Amendment and the attorneys First Amendment right to provide legal advice to his clients. This Essay explores the public policy issues raised by this case, whether nurses have the same right to withhold their labor as other employees, as well as certain issues which the court did not reach such as whether criminal prosecution of the nurses is preempted by the National Labor Relations Act. Additionally, this Essay explores legal issues surrounding the criminal prosecution of an attorney based on advice he may have given which the court ultimately found to be “profoundly disturbing.” The Essay concludes by explaining that the liquidated damage provision, which may have sparked this entire controversy, was probably unenforceable as a penalty, another issue not reached by the court, that criminal prosecution of both the nurses and their attorney was unwarranted and that the Appellate Division decision was correctly decided.

I would add that in addition to the invalidity of the $25,000 liquidated damages charge that these type of nurses/physical therapists/etc. are typically subject to, these contracts usually provide that the employee must meet all of the ethical and good-care obligations of her profession. Very often, the health care assembly line operations that employ these immigrant health care workers force them to violate their own professional standards or face the $25,000 penalty for quitting. Such practices are thus not only unethical, they also constitute a breach of the very contract under which they seek to sue their former employees.

These are all factors to consider when an immigrant health care worker is seeking the advice of an attorney and considering quitting due to untenable working conditions.

Picture courtesy of immigrationqna.info