Progressive Sued For Not Paying Overtime to Auto Appraisers

It has been a while since we’ve seen a major insurance company sued by its automobile damage appraisers for overtime.  The last few to hit the Courts of Appeals resulted in rulings against them.  Progressive Casualty Insurance Company was just sued last week by two automobile damage appraisers who claim that they, and all other MRRS (Progressive calls them “managed repair reps” or “MRRs;” they are also called "Claims Adjusters -- Auto Damage") should have been paid overtime when they work more than forty hours per week.

There is a very informative post on this topic by Richard Hayber of Hartford.  The general rule seems to be that automobile damage appraisers whose primary duty is to prepare damage estimates and reach an agreed price with the auto-body shop are entitled to overtime pay.  When the auto appraisers spend time negotiating with the insured over the value of a totaled vehicle, their duties start to look more like claims adjusters (who usually don’t get overtime pay). 

This latest lawsuit quotes from job postings which list the duties of the position.  Those duties do not include negotiating overt total losses.  The case is being handled by the Hayber Law Firm in Hartford.  It asserts only the Fair Labor Standards act.  This law gives other employees the chance to join the case just by signing a Consent Form and filing it with the court. 

This case will be worth watching.  Earlier decisions in the District of Connecticut were favorable to automobile damage appraisers, including Reich v. AIAC in 1994 (summary judgment for the appraisers), and Neary v. Metropolitan Property and Casualty Company in 2007 (defense motion for summary judgment denied). 

Supreme Court Limits First Amendment Rights For Public Employees

While yesterday's Wal-Mart decision is getting all the press, the U.S. Supreme Court issued another decision yesterday that will have broad impact on public employees.  In Borough of Duryea v. Guarnieri, the Supreme Court limited public employees' First Amendment right to petition the government for redress of grievances.

The facts are straightforward.  Charles Guarnieri filed a grievance when he was terminated from his position as Chief of Police in Duryea, Pennsylvania.  He was ordered reinstated, and the borough council later issued directives instructing him how to perform his duties. He filed a second grievance, and an arbitrator ordered that some of the directives be modified or withdrawn.  Guarnieri then filed suit, claiming than the directives were issued in retaliation for the filing of his first grievance, and violated his First Amendment right to petition the government for a redress of grievances.  Guarnieri won at trial, and the Third Circuit Court of Appeals affirmed, holding that a public employee who has petitioned the government through a formal mechanism such as the filing of a lawsuit or grievance is protected under the Petition Clause from retaliation for that activity, even if the petition concerns a matter of solely private concern.

The Supreme Court reversed, holding that a government employee is not protected by the petition clause unless the petition relates to a matter of public concern.  In doing so, the Court applied the same limitations it previously had applied to the First Amendment's Speech Clause to the Petition Clause.  The Court dismissed the fact that most governmental petitions are of a private nature, because, in their view, "Petitions, no less than speech, can interfere with the efficient and effective operation of government."

While this case does make the law consistent when it comes to public employees attempting to exercise their rights under the First Amendment, it is consistently wrong.  This case continues the line of jurisprudence that effectively gags public employees.  These cases allow government officials to retaliate against public employees under circumstances that clearly would be illegal when applied to private citizens.  In my view, the First Amendment is the foundation of our rights as a free people, and should be interpreted broadly, and apply equally to all.

Connecticut Outlaws Gender Identity Discrimination

Along with the landmark paid sick leave law discussed yesterday, the Connecticut General Assembly also has outlawed discrimination based upon gender identity or expression. 

House Bill 6599, passed on June 4, makes it illegal to discriminate based upon a person's "gender-related identity, appearance or behavior, whether or not that gender-related identity, appearance or behavior is different from that traditionally associated with the person's physiology or assigned sex at birth."  The prohibition is comprehensive, applying not just to employment, but also to housing, state contracts, higher education, library services, utility services, automobile insurance, trade, public accommodations, credit, state services and golf club memberships.  This enormous step forward in LGBT rights, which Governor Malloy intends to sign, will take effect on October 1, 2011.  The employment provisions are extremely broad, as they apply to every employer in Connecticut with at least three employees.


I can't tell you how gratifying it is that my home state is working to swing the pendulum back towards protecting the rights of human beings, instead of corporate "persons."

Connecticut Becomes First State To Require Paid Sick Leave (For Some Workers)

Hallelujah!  My home state, Connecticut, has just passed the first law in the country requiring employers to offer paid sick leave.  Governor Malloy has already said he will sign the bill into law.

The law requires employers to provide one hour of paid sick leave for each 40 hours worked, up to a maximum of 40 hours (5 full days) per year.  Employees are allowed to carry over up to 40 unused hours per year.  Employees can begin using the sick leave after they have worked 680 hours (17 full weeks).  Paid sick leave can be used for the employee's health condition, including treatment or preventive care, or the health condition of a child, parent or spouse.  Special provisions of the law apply to victims of domestic violence.

The law is not perfect.  It does not apply to all employers; only those with 50 or more employees are covered.  In addition, manufacturing companies and nationally chartered nonprofit organizations are exempted from coverage.  The law also does not apply to all employees.  Only hourly workers, not salaried, are covered.  In additions, day laborers, temporary workers, part-time and adjunct faculty at state colleges and independent contractors are excluded.

Still, this is a great start.  Once this law goes into effect, the dire predictions of its opponents will be shown to be nothing but hot air.  At that point, we may be able to expand it to cover salaried workers, smaller employers, manufacturers, etc.  And once that happens, lets hope the good example of Connecticut will lead other states to do the same.

Is The Average CEO Really Worth That Much?

2010 was a great year, if you happen to be the CEO of a major corporation.  USA Today has reported that median CEO pay went up 27%, to $9 million in 2010.  Compare this with the average worker, whose pay rose a whopping 2.1%.  According to a paper by Professor G. William Domhoff of the University of California at Santa Cruz, "The ratio of CEO pay to factory worker pay rose from 42:1 in 1960 to as high as 531:1 in 2000, at the height of the stock market bubble, when CEOs were cashing in big stock options. It was at 411:1 in 2005 and 344:1 in 2007, according to research by United for a Fair Economy. By way of comparison, the same ratio is about 25:1 in Europe."

This data reinforces my belief that there is something fundamentally broken in our system.  As noted by Professor Domhoff, in 2007 the top 1% of American households owned 34.6% of all privately held wealth, while only 15% of the wealth was owned by  the bottom 80%, who are the workers in the economy.  Between 1983 and 2004, 42% of the new financial wealth created in the U.S. economy went to the top 1%, 94% went to the top 20%, while the bottom 80% received only 6%.  Think about that.  Of all the new financial wealth generated in the United States during the '80s, '90s, and early 2000s, only 6% went to the working class.  We are rapidly turning into a plutocracy (if we're not there already).

During the first Gilded Age, there was a realization that such concentration of wealth was bad for the country.  Theodore Roosevelt spearheaded progressive policies to try to rein this in.  But in this new Gilded Age, we have one political party that not only is unwilling to help the worker, but is dead set on avoiding anything that could be considered a limitation on the freedom of corporations to do what they want.  Where is this generation's T.R.?

Good News -- Employment Is Up!

The Bureau of Labor Statistics released its report on March employment figures.  The good news is that non-farm employment is up by 216, 000, almost 10% more than predicted.  The BLS reports 230,000 new private sector jobs, with 14,000 fewer local and state government jobs.

This is the best monthly showing for new jobs (excluding the one-time bump for temporary census workers last spring) since March, 2006.  At the same time, the unemployment rate was little changed at 8.8 percent, while the number of unemployed fell to 13.5 million. The "U-6" unemployment rate, which includes people with part-time jobs who want to work full time, as well as a portion of discouraged workers who are no longer looking for work, fell from 15.9 to 15.7 percent.  The number of long-term unemployed (those jobless for 27 weeks or more) increased from 6.06 million to 6.26 million.

The bad news is that we're still a long way away from getting back to where we were before the start of The Great Recession.  Since December, 2007, we've lost about 8.4 million jobs.  At current hiring rates, we won't reach the pre-recession peak level until January of 2014.  But, on the whole, I'll take the good news.

The Risks Of The Wal-Mart Class Action

The U.S. Supreme Court heard oral argument yesterday on the Wal-mart Class Action.  This case has me worried.

The lawsuit is a giant class action about gender discrimination -- potentially the largest class action in history.  A group of women sued Wal-mart in 2001, claiming that the company systematically discriminates against women in both pay and promotional opportunities.  After years of litigating, and after reviewing statistical evidence showing that hourly and salaried female employees receive lower pay and less advancement opportunities than do males, the trial court certified the case to proceed as a class action.  This decision was upheld by a 6-5 decision of the 9th Circuit Court of Appeals in California.  Wal-mart then requested review by the Supreme Court.

The issue before the Supreme Court is not whether Wal-mart discriminates.  Rather, it is whether the case can proceed as a class action.  If not, each of the hundreds of thousand women who are potential class members would be required to file her own individual lawsuit.  What is at issue is the "commonality" requirement for class actions -- whether or not the claims of hundreds of thousand women, who worked at 3,400 stores under tens of thousand different managers, are sufficiently related to allow the case to be treated as a class action.  Wal-mart's argument is, essentially, that a class this size simply cannot, as a matter of law, meet the commonality requirement.  This argument was rejected by the trial court and the 9th Circuit.

I am worried about this case because it presents the corporatist majority on the Supreme Court, led by Chief Justice Roberts, a golden opportunity to eviscerate the class action mechanism.  By way of disclosure, I am a class action lawyer.  As an employee rights advocate, I have found one of the most effective ways to hold a large company accountable for systemic wrong-doing is the class action.  Which is a major reason why large corporations hate class actions and would love to see it become much more difficult to proceed with a class action.  And as the Citizens United decision makes clear, the current Supreme Court is much more concerned with the rights of corporations that with the rights of individuals.  And while the Court occasionally surprises me, I fully expect this decision to be in line with Citizens United.  And that will make it much more difficult for employees to band together to fight against illegal and unethical conduct by large employers.