In September, the Department of Labor (DOL) and the Internal Revenue Service (IRS) signed a memorandum of understanding (MOU) addressing the business practice of misclassifying employees as independent contractors to avoid providing employment benefits and protections. Eleven states have also signed or agreed to MOUs: Connecticut, Hawaii, Illinois, Maryland, Massachusetts, Minnesota, Missouri, Montana, New York, Utah, and Washington. From the DOL news release:

The memorandums of understanding will enable the U.S. Department of Labor to share information and coordinate law enforcement with the IRS and participating states in order to level the playing field for law-abiding employers and ensure that employees receive the protections to which they are entitled under federal and state law.

“We’re here today to sign a series of agreements that together send a coordinated message: We’re standing united to end the practice of misclassifying employees,” said Secretary Solis. “We are taking important steps toward making sure that the American dream is still available for all employees and responsible employers alike.”

“This agreement takes the partnership between the IRS and Department of Labor to a new level,” said IRS Commissioner Doug Shulman. “In this new phase of our relationship, we will work together more efficiently to address worker misclassification issues, and better serve the needs of small businesses and employees.”

Business models that attempt to change, obscure or eliminate the employment relationship are not inherently illegal, unless they are used to evade compliance with federal labor laws — for example, if an employee is misclassified as an independent contractor and subsequently denied rights and benefits to which he or she is entitled under the law. In addition, misclassification can create economic pressure for law-abiding business owners.

The MOUs are the result of a General Accounting Office report estimating that employee misclassifications cost the federal government $2.72 billion in 2006. The GAO noted that the DOL, the IRS, and state agencies traditionally have not shared information on misclassification, but the MOUs will change these practices.

In the November Labor Letter from Fisher & Phillips LLP, John McLachlan presented a cogent analysis of a hypothetical situation to help employers properly classify workers as employees or independent contractors. And Alfred Robinson Jr. of the InsideCounsel blog offers this advice to employers in light of the initiative to correct misclassification:

1. Audit the company’s classification of independent contractors to assess whether any should be treated as employees. Be aware that the test of whether a worker is an employee rather than an independent contractor derives from the broad “joint employer” rules under the FLSA. Those rules look at the economic realities test to determine whether a person is “suffer[ed] or permit[ted] to work” and acts “directly or indirectly” on behalf of an employer’s interests. To complicate the area, the standards for the IRS and under various state laws are not necessarily the same and often differ.
2. Review written agreements with independent contractors to document the job or tasks for a contractor to perform, identify expected results, provide contractor’s with the discretion to perform their work, etc. If an employer does not have a written agreement, he or she should consider instituting them.
3. Monitor the manner in which the employer treats his or her employees versus independent contractors to maintain distinctions and to avoid over-utilization of independent contractors.
4. Review relationships an employer may have if he or she uses “temporary” employees from a staffing company or leases employees from a professional employer organization (PEO) to assess any joint employment risks.
5. To the extent that an employer seeks to reclassify independent contractors as employees and participate in the IRS’ [Voluntary Classification Settlement Program], evaluate the hours worked and compensation paid to these workers as independent contractors to quantify potential back wage exposure under the FLSA before participating.
6. Verify whether any state law might apply. For example, California recently enacted a comprehensive independent contractor statute including civil as well as criminal penalties.

For the statutes and annotations you need to get a handle on federal employment law, pick up your copies of O’Connor’s Federal Employment Codes Plus (2011-2012) today. The new edition will be available in a few months.

Worried that you’ll fall behind on new Texas case law relating to hot topics like fraudulent inducement, animal actions, and medical malpractice? Have no fear—O’Connor’s Texas Causes of Action 2012 is here to help you stay in the loop.

This edition includes updated commentary reflecting changes from the 2011 legislative session. Order your copy now by visiting our webstore or calling (800) OCONNOR (626-6667).

Earlier this month, the U.S. Supreme Court issued a unanimous employment-law decision in favor of religious institutions. In Hosanna-Tabor Evangelical Lutheran Church & School v. EEOC, ___ U.S. ___ (2012) (No. 10-553; 01-11-12), the Court clarified that the “ministerial exception” bars employment-discrimination suits brought on behalf of ministers:

Until today, we have not had occasion to consider whether this freedom of a religious organization to select its ministers is implicated by a suit alleging discrimination in employment. The Courts of Appeals, in contrast, have had extensive experience with this issue. Since the passage of Title VII of the Civil Rights Act of 1964, 42 U. S. C. §2000e et seq., and other employment discrimination laws, the Courts of Appeals have uniformly recognized the existence of a “ministerial exception,” grounded in the First Amendment, that precludes application of such legislation to claims concerning the employment relationship between a religious institution and its ministers.

We agree that there is such a ministerial exception. The members of a religious group put their faith in the hands of their ministers. Requiring a church to accept or retain an unwanted minister, or punishing a church for failing to do so, intrudes upon more than a mere employment decision. Such action interferes with the internal governance of the church, depriving the church of control over the selection of those who will personify its beliefs. By imposing an unwanted minister, the state infringes the Free Exercise Clause, which protects a religious group’s right to shape its own faith and mission through its appointments. According the state the power to determine which individuals will minister to the faithful also violates the Establishment Clause, which prohibits government involvement in such ecclesiastical decisions.

* * *

The interest of society in the enforcement of employment discrimination statutes is undoubtedly important. But so too is the interest of religious groups in choosing who will preach their beliefs, teach their faith, and carry out their mission. When a minister who has been fired sues her church alleging that her termination was discriminatory, the First Amendment has struck the balance for us. The church must be free to choose those who will guide it on its way.

Keep in mind that the Court’s opinion applies to ministers who perform religious functions, not to lay employees of religious employers. Further, the Court limited its holding to employment-discrimination suits brought by ministers:

We express no view on whether the exception bars other types of suits, including actions by employees alleging breach of contract or tortious conduct by their religious employers. There will be time enough to address the applicability of the exception to other circumstances if and when they arise.

The Hosanna-Tabor case will be annotated and discussed in the upcoming edition of O’Connor’s Federal Employment Codes Plus.

Since 1992, we at Jones McClure Publishing have been your first source for the law. Soon, we’ll become your first search for the law as well.

Over the next few months, we’ll be sending out information and updates about our new online service. Sign up for e-mail updates and information about the launch date here.

In the meantime, you can follow us on Twitter (@jonesmcclure), and we appreciate your continued readership of this blog.

We’re excited to provide you with a new research experience soon.

— The O’Connor’s Online Team

In a recent post at Talking Biz News, “Why the Graphic Novel Will Save Business Journalism,” the blog highlights a portion of Aziz Ali’s interview with Caleb Melby, author of the graphic novel The Zen of Steve Jobs, forthcoming from Forbes. Focusing on an excerpt from the article, the post highlights the possible trend of using graphic novels to tell compelling stories:

But Journalism as an industry is in a state of crisis. It has been for a good 3-4 years, and we have new leadership here in Forbes under Lewis D’vorkin who’s been spearheading our New NewsRoom Initiative and he actually does a blog post on that at the beginning of every week about what we’re doing to stay true to being innovative and progressive in how we convey business news. We’re basically making sure that we’re using all the tools at our disposal to deliver quality news. We’ve taken on a contributor model, so we’re able to bring in other experts into our content.

It’s also a nerve-wrecking time for Journalism, but it’s exciting that you can pitch a project like this because you’re looking for all possible answers because ears are eager to listen. And so, despite being a graphic novel, it’s very much grounded in and in-tune with the Forbes brand. It’s telling the story of a great business leader, telling it in a way that is engaging.

There are some obvious implications for legal publishing as well, particularly given the rather dry nature of legal information. Take for example Nathan Burney’s excellent Criminal Lawyer’s Guide to Criminal Law. If that isn’t an engaging method for reading about criminal law, we’re not sure what is.

Yesterday, in U.S. v. Jones, ___ U.S. ___ (2012) (No. 10-1259; 1-23-12), the Supreme Court held that a GPS search conducted on a suspected drug dealer’s car was a “search” within the meaning of the Fourth Amendment.  We’ve previously blogged about this issue and about the facts of the case.

In an opinion written by Justice Scalia, the 5-4 majority took an originalist approach and held that a physical intrusion on a personal effect (here, a car) would have been considered a search within the Fourth Amendment at the time the amendment was adopted, not unlike a constable hiding himself in a coach to track its movements.  The Court discussed the historical development of Fourth Amendment jurisprudence based on property law, in which the definition of “search” was tied to common-law trespass.  The Court noted that the “reasonable expectation of privacy” test that comes from Justice Harlan’s concurrence in Katz v. U.S., 389 U.S. 347, 360 (1967) (Harlan, J., concurring), “established that ‘property rights are not the sole measure of Fourth Amendment violations,’ but did not ‘snuf[f ] out the previously recognized protection for property.’” Jones, ___ at ___ (quoting Soldal v.  Cook Cty., 506 U. S. 56, 64 (1992)).  The Jones Court reiterated that “Katz did not narrow the Fourth Amendment’s scope.”

However, the Jones decision does not put all questions to rest.  The Court did not consider the government’s argument that even if the GPS tracking was a search, it was a reasonable search—the government did not raise the issue in the lower courts, and the D.C. Circuit did not address it.  Orin Kerr made this point yesterday in a post on The Volokh Conspiracy blog. Additionally, Adam Liptak of the New York Times reported that because the case focused on the physical aspect of the intrusion, it leaves open the questions posed by new forms of technology that do not require a physical intrusion.

For several years, an affluent neighborhood near Rice University in Houston has been trying to stop the development of a luxury high-rise apartment complex.  Because Houston has no zoning laws to speak of, residents who oppose the high rise have tried several tactics to halt construction—bumper stickers, traffic studies, mayoral pressure, city ordinance amendments—all to no avail.

Enter intellectual property law. A Dallas-based architectural firm filed suit against the high-rise developer, claiming the high rise infringes on the firm’s copyright for architectural plans used to construct a luxury apartment building in Minneapolis.  The plaintiff seeks an injunction to prohibit construction and seeks to recover lost profits and attorney fees.   What remains to be seen is if either side will use O’Connor’s Federal Intellectual Property Codes to further its cause.

We’re happy to report that this week The Legal Writing Institute awarded the 2012 Golden Pen Award to Matthew Butterick, author of the essential reference manual, Typography for Lawyers. The announcement is reprinted below. Congratulations, Matthew!

I am delighted to announce that the Legal Writing Institute’s Golden Pen Award for 2012 goes to Attorney Matthew Butterick.

Matthew Butterick is the designer of the popular website Typography for Lawyers, and of the book by the same name. Matthew Butterick has become the go-to person for document design information in the legal world. In the three short years since his website first went live, and the twelve months since his book Typography for Lawyers was published, he has made a very large impact on legal practice. Otherwise-temperate critics have showered his work with praise. Harvard’s William Rubenstein calls Butterick “a messiah.” Bryan Garner describes Butterick’s advice as “infallible,”  and the first edition of Typography for Lawyers as not only “bold and fresh and original” but also “fully developed,” reading like “a fifth edition.”

Many lawyers have known, or at least have suspected, that their document-design practices were not ideal, and might even be holding them back. Yet many have been intimidated by the complex settings of their word-processing software, let alone the seemingly arcane practices of professional type setters. Butterick’s clear, easy-to-follow website and reference book take the fear and mystery out of document design for legal texts, giving lawyers of all kinds the tools they need to let their polished prose truly shine.

Mr. Butterick has also designed two typefaces for attorneys: Alix and Equity. Alix is a monospaced typeface, like Courier, but immeasurably superior. Lawyers who are occasionally required to set documents in a monospaced font now have a more readable choice. Mr. Butterick’s newest font, Equity, is a proportional typeface, like Times New Roman, and has similar overall dimensions and architectural features, allowing it to be easily substituted for Times New Roman. Equity is specifically designed not just for use in long documents but for legal documents in particular.

Please join us in congratulating Mr. Butterick at a ceremony to be held during the 15^th Biennial Conference of the Legal Writing Institute [later this year].

 

Kenneth D. Chestek
President, The Legal Writing Institute

Joshua Engel of Law Technology News reported on Tuesday that the U.S. Supreme Court will soon issue its decision in U.S. v. Jones, which we blogged about last month. He notes that even if the Supreme Court holds that warrantless GPS use is permissible under the U.S. Constitution, state courts may continue to restrict the practice based on broader protection afforded by state constitutions. To illustrate the point, he summarizes criminal cases from Washington and New York holding that the state constitution requires police to get a warrant before installing a GPS tracking device.

The Washington Supreme Court, in State v. Jackson, 76 P.3d 217, 222 (Wash.2003), began by noting that

The inquiry under article I, section 7 [of the Washington Constitution] is broader than under the Fourth Amendment to the United States Constitution, and focuses on “those privacy interests which citizens of this state have held, and should be entitled to hold, safe from governmental trespass.”

The court continued:

If police are not required to obtain a warrant under article I, section 7 before attaching a GPS device to a citizen’s vehicle, then there is no limitation on the State’s use of these devices on any person’s vehicle, whether criminal activity is suspected or not. The resulting trespass into private affairs of Washington citizens is precisely what article I, section 7 was intended to prevent.

Id. at 224. The New York Court of Appeals followed suit in People v. Weaver, 909 N.E.2d 1195, 1202 (N.Y.2009):

[W]e acknowledge that the determinative issue remains open as a matter of federal constitutional law, since the United States Supreme Court has not yet ruled upon whether the use of GPS by the state for the purpose of criminal investigation constitutes a search under the Fourth Amendment, and, indeed, the issue has not yet been addressed by the vast majority of the Federal Circuit Courts. Thus, we do not presume to decide the question as a matter of federal law. The very same principles are, however, dispositive of this matter under our State Constitution. If, as we have found, defendant had a reasonable expectation of privacy that was infringed by the State’s placement and monitoring of the [GPS device] on his van to track his movements over a period of more than two months, there was a search under article I, § 12 of the State Constitution. And that search was illegal because it was executed without a warrant and without justification under any exception to the warrant requirement. In light of the unsettled state of federal law on the issue, we premise our ruling on our State Constitution alone.

So the Supreme Court’s decision in Jones likely won’t be the final word on the issue. One thing’s for sure: technology will continue to advance, and our courts will need to continue interpreting the new developments against constitutional frameworks.

We’ve blogged about the implications of Facebook for attorneys and their clients. Joe Palazzolo of the Wall Street Journal Law Blog explores a different angle—the impact of Facebook on law school applications.

Citing a survey by Kaplan Test Prep, Palazzolo notes that 37% of law school admissions officers have visited applicants’ pages on Facebook or other social-networking sites. Less than 25% of the admissions officers for colleges and business schools surveyed said they looked at Facebook as part of their admissions process.

Cynthia Hsu of Findlaw’s Greedy Associates blog also picked up on the story, and she advises applicants to take a look at the photos associated with their Facebook profiles: “[C]onsider taking down offending photos. And upload some non-offensive ones.” Sounds like good advice for practicing attorneys, too.