MAY 2006

            The fact that an employee stays on the job just long enough to earn a bonus does not permit the employer to withhold payment. Simpson v. Lakeside Engineering, -- N.Y.S.2d --, 2006 WL 260048 (4^th Dept. 2006).  In Simpson, the employer offered a $10,000 bonus if the employee completed a year's service.  The employee quit just after she completed the year and the employer refused to pay the bonus.  The court said that an employer cannot argue that a bonus is discretionary after an employee has completed all the requirements.  The employer’s arguments of fraud and lack of good faith on the part of the employee were not enough to change the Court’s decision.  

            The devil is in the details.  In a recent case, a purchaser was bound by language disclaiming a warranty despite the fact that the language was on the reverse side of a form.  Roger’s Fence v. Abele Tractor and Equipment Co., --N.Y.S.2d--, 2006 WL 259600 (4^th Dept. 2006).  Unfortunately for the purchaser, its vice-president signed an agreement that stated warranty terms were on the reverse side and also signed a delivery report indicating that he reviewed and understood the warranty coverage.  As a result of those signatures, the purchaser was bound by the disclaimer.

            The question of what is a day's pay is more complex than it may seem.  In New York, a contractor working on public projects must pay workers the local prevailing rate for a day’s work in the same trade.  The Commissioner of Labor has the authority to classify workers by type (i.e. ironworker or glazier) and determine wage rates.  In a recent decision, the Court of Appeals said that when the Commissioner is classifying the work performed by an employee to a particular trade he does not need to consider the actual contractor practices within the locality.  Lantry v. State of New York, -- N.E.2d. --, 6 N.Y.3d 49 (2006)  Rather, the Commissioner can disregard local practice and rely upon job classifications as defined in collective bargaining agreements.

            If a self-insured employer, or an insurance carrier, wants to reserve their rights in a worker’s compensation case they need to say so loud and clear.  In New York, a self-insured employer or a carrier has the right to offset an injured worker’s future benefits with the proceeds of any recovery resulting from a lawsuit against a third-party.  However, there is a clear burden on the employer and the carrier to overtly state the intent to seek an offset.  See Brisson v. County of Onondaga, -- N.E.2d --, 2006 WL 345880 (2006).  Simply disagreeing with a worker’s belief that the employer or carrier has no right to seek an offset is not enough.  The employer must expressly and unambiguously reserve its rights or they will be considered waived.  

            It appears that New York is beginning to enter the debate on mandated health insurance.  On January 17, 2006 New York Assemblyman Daniel O’Donnell introduced the “Fair Share” bill. (A.9534)  This bill is similar to the Maryland bill targeting Wal-Mart and seeking to force an increase in health benefits for Wal-Mart employees.  O’Donnell’s bill would force companies with 10,000 or more employees to pay a tax of 8% of their total payroll.  This bill has passed the Assembly Labor Committee but must pass the Assembly Codes, and Ways and Means Committees before being presented to the Assembly.  Notably, Assemblyman Nick Spano is advocating a bill that would levy a $3 per hour/per employee tax on businesses with 100 or more employees.

Brian R. Biggie