Recent Developments in Executive Compensation
Although executive compensation has been the subject of evolving reform for several years, the bright spotlight of public attention is now focused on this issue, due in part to the bursting of the stock market bubble, the collapse of Enron, and a number of other highly publicized corporate scandals. The image of executives enjoying excessive compensation packages as revenues and earnings decline, and stock values of the companies they manage plummet, is a dangerously common stereotype.
Investors May Be Liable to WARN Act Plaintiffs
Major investors in companies that commit violations of the federal Worker Adjustment and Retraining Notification (WARN) Act may not be immune to liability, according to a federal court sitting in the Southern District of New York. <i>Vogt v. Greenmarine Holding, LLC</i>, No. 02 Civ. 2059 (S.D.N.Y. Jan. 1, 2004). Relying on Department of Labor (DOL) regulations, the court denied a motion to dismiss the claims of a class of plaintiffs who were terminated by a bankrupt company against the investors in the bankrupt entity.
China's IP Is Not Entirely Out of the Haze Yet
When China first bid for WTO membership, its intellectual property-related laws were one of the main obstacles to its joining the organization, as WTO membership required China to comply with the Agreement on Trade-Related Intellectual Property Rights (TRIPS). In its WTO accession documents, China declared its commitment to bringing its legal system in conformity with the TRIPS Agreement. Since then, China has come a long way. Nevertheless, not all problems have been resolved.
Does Constructive Discharge Bar an Employer's Defense?
In last month's <i>Employment Law Strategist</i>, we explored the background to a growing conflict among the circuit courts regarding the availability of the so-called <i>Ellerth/Faragher</i> affirmative defense in constructive discharge cases. We began with an analysis of <i>Suders v. Easton</i>, 325 F.3d 432 (3d Cir. 2003), in which the Third Circuit held that holding an employer strictly liable for a constructive discharge resulting from the actionable harassment of its supervisors more faithfully adheres to the policy objectives set forth in <i>Ellerth</i> and <i>Faragher</i>. Granting <i>certiorari</i> to consider the Third Circuit's ruling, the U.S. Supreme Court has now undertaken to resolve the discord among the circuits.
Lump Sum Damages: What Happens to Employers?
More often than not, it is the defendant who brings the post-trial motions that follow a jury finding that an employer is liable for employment discrimination. Those motions normally seek, among other things, a new trial, a judicial determination that the evidence did not support the verdict, and/or a remittitur of the damages awarded. Less common are substantive motions brought by the victorious plaintiff, such as a motion for additur, where a damages award larger than that assessed by the jury is sought. That may soon change, as victims of discrimination, bolstered by a new trial court decision from New Jersey, may seek to hold their employer responsible for any increased taxes that he or she may have to pay as a result of winning at trial. Such a tactic has the potential to increase greatly -- perhaps into six figures -- the amount of damages for which the employer found to have discriminated may be liable.
ADA Denial of Rehire
Recently, a unanimous, seven-member, United States Supreme Court held that the only relevant question on summary judgment in an action alleging disparate treatment under the American with Disabilities Act (ADA) was whether there was sufficient evidence from which a jury could conclude that an employer made its decision based on an employee's status as disabled, notwithstanding the employer's proffered explanation. <i>Raytheon Company v. Hernandez</i>, 504 US __ , 124 S.Ct. 513 (2003). The Court further held that the employer's unwritten policy against rehiring former employees who were terminated for any violation of its misconduct rules was a legitimate, non-discriminatory reason under the ADA. This case briefing discusses the Court's opinion in <i>Raytheon</i>, and the decision's implications for employers.
Breaking News...
An audit by Wal-Mart of 128 stores and over 25,000 employees has reportedly revealed thousands of labor violations at the Arkansas-based retailing chain, including 1371 violations of child labor laws, 60,000 missed breaks and16,000 skipped meal times, primarily in violation of state labor laws. The July, 2000 internal audit was apparently distributed to high-level company executives but has now come to public attention through lawsuits filed against the company, which employs more than 1.2 million U.S. workers.
