California Guard Veterans Told to Repay Enlistment Bonuses

Close to a decade ago the Pentagon used a classic maneuver to entice soldiers to reenlist: hefty bonuses. Now, officials are demanding that thousands of those vets pay the money back. One California veteran affected by the situation is Christopher Van Meter. He was awarded the Purple Heart after being thrown from an armored vehicle during a deployment to Iraq. When the moment came for him to retire back in 2007 after serving for 15 years in the Army, he was encouraged to reenlist. According to Van Meter, he was encouraged with a reenlistment bonus of about $15,000. About a decade later, officials realized that Van Mater and many others like him were not technically eligible to receive the bonuses they were given to reenlist.

Bonus Eligibility: In recent news, bonus eligibility has been discussed – particularly the fact that only soldiers holding certain assignments (i.e. intelligence, noncommissioned officer posts, civil affairs, etc.) were eligible for the bonuses. Investigation into the situation uncovered both fraud and mismanagement by California Guard officials who were desperately offering the bonuses in order to meet their enlistment target numbers.

In 2011, the California Guard incentive manager, retired Master Sgt. Toni Jaffe, pleaded guilty to filing false claims of $15.2 million. During the course of her admission, she stated that from Fall 2007 through Fall 2009, she routinely submitted fictitious claims on behalf of California National Guard members to pay bonuses to members she knew were not eligible, and to pay off officer’s loans she knew were ineligible for loan repayment. She was sentenced to 30 months in federal prison. Three other officers involved pleaded guilty, were required to pay restitution and put on probation. As a result, thousands of soldiers are now being asked to pay a hefty price for the fraudulent/fictional claims. Millions in enlistment bonuses are basically being recalled.

Van Meter, mentioned above, was shocked to receive a letter stating he owed $46,000: a combination of $15,000 enlistment bonus, a student loan repayment amount and an officer bonus…plus a processing fee. After his retirement in 2013, he had three years to pay back the debt. That meant monthly payments of more than $1,300 –leaving Van Meter struggling to provide the basics for his family. They were eventually forced to refinance their mortgage in order to pay off the staggering debt that they didn’t even know they had accumulated. The Van Meter family is one of many in similar situations. Some claim that approximately 9,700 current and retired soldiers have been told to repay some or all of the bonuses they received years ago, but the military auditor handling the process, Col. Michael Piazzoni, stated that the number was lower.

According to Piazzoni, 11,000 soldiers were included in the audit. 1,100 were discovered as receiving unauthorized distributions that need to be repaid. 5,400 soldiers were discovered to have missing paperwork or proper documentation of eligibility and have to pay back the money they received. Approximately 4,000 soldiers were found to be eligible for the payments as they were distributed. The process is not yet complete, but auditors have already confirmed 2,300 instances of unauthorized bonus payments to about 2,000 soldiers. The total comes to $22 million in unauthorized bonuses. That number includes 1,100 soldiers who received unauthorized money and the soldiers from the 5,400 who were unable to show proof of eligibility. The remaining recipients will need to produce the proper documentation proving their eligibility for the funds or they could be held liable to repay the amounts back to the Defense Department.

The audit and recoupment is being handled through a federal program jointly administered by the National Guard Bureau and the Department of the Army. The California National Guard has stated that it does not have the authority to waive the debts and that their hands are tied in this situation. As of now, there is no law passed by Congress to waive the debts so they stand, leaving the California National Guard in a difficult position as there isn’t much they can do to advocate for their soldiers. Affected soldiers are able to petition to have a debt waived. The military does hole the authority to waive an individual repayment, but only on a one-by-one basis. There is no authority held by the military to issue a blanket waiver to cover all soldiers affected by this situation.

Soldiers are being encouraged to take advantage of the appeals process while the Pentagon, the Army, the National Guard Bureau, the California Army National Guard and other relevant authorities and institutions work together to work towards a resolution. Soldiers affected who have petitioned for debt forgiveness have been denied, Van Mater multiple times. Van Meter is just one California vet who accepted an incentive payment in good faith. Many of them paid a heavy price for their military service; many even experienced severe injuries after reenlisting. And now, years later they are offered processing fees, interest charges, wage garnishment, tax liens and fines. It’s possible that Congress will take action to resolve the issue when members return from election recess.

If you have questions or concerns regarding enlistment bonuses, or proving your eligibility for bonuses please get in touch with one of the experienced southern California employment law attorneys at Blumenthal, Nordrehaug & Bhowmik. 

Desperate Housewives Star Files Retaliation Lawsuit

Many have heard of the popular TV series called the Desperate Housewives. Of those who watch the show, almost all should be familiar with Nicollette Sheridan. She has been called the most “risqué” of the women on the show. In most recent news, she may be better known for her recently filed lawsuit.

According to Sheridan, she got into a verbal argument on set with the writer/creator of the show, Marc Cherry. She claims that the argument ended when Cherry slapped her. According to Sheridan, this was battery. According to Cherry, this was stage direction.

Sheridan responded to the incident by complaining to the network as well as the show’s producer. The next year, her character, Edie Britt, was killed in the midst of the show. Sheridan saw this as retaliation for her complaints regarding the “battery” on set the previous year and filed a lawsuit claiming such. The lawsuit was twice dismissed by trial courts and revived twice by the court of appeal.

What secret, sordid detail led to such an intriguing on again, off again response from the courts? It’s not nearly as intriguing as one might expect from a plaintiff known for being “spicy.” In fact, it’s downright boring. The question that is causing the confusion is this: Did Sheridan have to file an administrative complaint with the Labor Commission before suing?

According to the court of appeals, she did not have to file such a complaint. Their decision was based on a brand-new labor code stating:

“A person is not required to exhaust administrative remedies…unless the section under which the action is brought expressly requires it.” The sections referenced in this case are not seen to “expressly require” it as they use the term “may” instead of “shall” in regards to filing a claim with the Labor Commission. The court of appeals does not feel that the word “may” indicates a mandatory requirement. This resulted in the reinstatement of her case allowing Sheridan the opportunity to seek resolution in court.

If you need to discuss on the job battery or if you have other questions regarding southern California employment law, please get in touch with the experienced attorneys at Blumenthal, Nordrehaug & Bhowmik.  

7 Tips on Negotiating Severance

If you suspect or are completely aware that you are about to be presented with a separation agreement at work, you might want to start thinking about your severance package. What’s important to you? What do you expect? What can you accept? What can you NOT accept? If you have no idea where to start when attempting to outline a basic needs and wants list for your soon to be presented severance package, take a few minutes to figure it out before you are asked for a decision on the matter.

Here are 7 Things to Consider in Relation to Any Severance:

1. Know both sides of the agreement: Don’t just know what you’re getting from the company; know what the company is getting from you. And vice versa. You separation agreement signature is worth money since it limits the number legal issues you, the “terminated employee”, can bring against the company.
2. The range of potential financial outcomes is “wide”: Top executives can usually expect to see their severance terms spelled out in their contract of employment. For others, from corporate ranks to upper-level management, things are more unclear. Informal guidelines and the rule of thumb come into play. The rough average is two weeks of pay for every year of employment (it can range from 1-4 weeks depending upon the circumstances at hand).
3. What you get depends on specific factors: Tenure on the job, performance records, reason for the termination, etc. can all come into play when the numbers are being discussed.
4. Work History: The first thing you probably want to examine with an employment lawyer in relation to severance negotiations are any documents that are available that chart your history at the company and how well you performed for them on the job. Documentation could determine whether you have a discrimination case to pursue or not. At the very least, hints of untoward behavior could lead to increased leverage for you during negotiations.
5. Your knowledge of company flexibility: It’s useful if you have some knowledge regarding what is off limits and what you can openly ask for when negotiating your severance. Some things are simply outside of your boss’s control. For instance, your boss can’t make exceptions to laws in place. There’s also not a lot of leeway regarding employee benefits. But many employers have funds earmarked for outplacement services.
6. Tap into relationships: If it’s useful, call relationships you have with bosses, human resource directors, etc. into play during negotiations. It can make a difference. If you have a close relationship with the boss or someone who will be on the other side of the severance negotiation table use it. And make sure to let you employment lawyer know that the relationship exists, too.
7. Look to the future: It’s not all about money. This agreement could affect your long-term career. You want to consider future job references and work history, etc. before you sign off on the severance.

Remember, at that first meeting when you are presented with your severance, you’ll be in shock. Even if it’s not a complete surprise, don’t sign anything. Try to politely request a meeting at a later date to wrap things up and get in touch with an employment law attorney at Blumenthal, Nordrehaug & Bhowmik to handle your severance negotiation. 

Starbucks Agreed to Pay up to $3M Settlement for Mileage Reimbursement Suit

An agreement is in place for Starbucks to pay up to $3 million to settle the lawsuit based on allegations that the popular coffee house did not reimburse named California employees for mileage related expenses incurred while on the job. Employers who typically incur mileage expenses while on the job include: store managers, assistant managers, and shift supervisors. These employees working at Starbucks stores located in California employed from March 2003 through March 2008 are eligible for payments of $30-75 each.

Attorney’s fees are included in the $3 million settlement as well as an undisclosed amount given to the representative plaintiff as an incentive award and a payment to the California Labor and Workforce Development Agency of $25,000.

In the documentation, Starbucks agreed to class-action status for settlement purposes along – they do not accept liability. Within the settlement paperwork it was agreed that the plaintiff and plaintiff’s attorneys are not to respond to questions from the media. The only exception is to allow them to refer to court documents on file. Jonelle Lewis filed the lawsuit in March 2007. She had worked at Starbucks since December of 2005. She resigned within one month of filing the lawsuit. The lawsuit filed by Lewis claimed that she consistently used her personal vehicle for work purposes (i.e. bank deposits, obtaining supplies, etc.) She also claimed that she attempted to request reimbursement for the mileage, but that Starbucks’ response was not to reimburse as a matter of “policy.”

If you feel you that company “policy” in your workplace is conflicting with your rights as outlined in employment law, get in touch with the experts at Blumenthal, Nordrehaug & Bhowmik.

Federal Aviation Administration Authorization Act vs. California’s Meal and Rest Break Requirements

Initially, wage and hour putative class action brought by the same truck drivers was dismissed. Alleged claims were based on violations of California’s meal break laws. The class action was dismissed on the ground that the Federal Aviation Administration Act (FAAAA) preempted California meal break laws. It was the second time in recent months that a court upheld the argument that California’s break laws are preempted by the FAAAA. The FAAAA specifically preempts state laws when there is a significant impact on the “routes, service or prices” of motor carriers.

Truck drivers received a boost recently as their attempt to revive the class action suit against Vitran Express Inc. was supported by the Ninth Circuit court’s decision that the Federal Aviation Administration Act did not preempt California’s meal and rest break requirements. Many are watching the progress of the case.

Additional Background on the Case:

Plaintiffs were former truck drivers of Performance Food Group, Inc. (PFG), located in California. Plaintiffs claimed that PFG arranged delivery routes in order to ensure excellent customer service and timely delivery of cargo without taking into account “time pressure” on the truckers who were being given delivery windows and other policies that prevented them from taking meal breaks.

If you have questions about the California meal break laws, ask the experts at Blumenthal, Nordrehaug & Bhowmik. 

Unpaid Commission: Can it Be Recovered?

Most feel they have a solid understanding of overtime pay and whether or not they are receiving what they deserve, but when it comes to commissions, there seems to be additional confusion. What is unpaid commission and when is an employee able to recover unpaid commission?

What is Unpaid Commission?

Before we can define unpaid commission, it’s important to define commission wages in general. Commission wages are common in many industries, but prevalent in the computer and technology industries particularly. According to California wage law, commission wages refers to compensation that is paid as a percentage of the price of the product or service that is being sold. Commissions can also be based on the number of items sold. Disputes regarding commission wages and unpaid commissions are often resolved under the same legal principles as bonuses.

When are commissions “unpaid?” The easy answer is that commissions are classified as unpaid when they have been earned and never received. Technically the commission is earned by the employee who “procures cause” for the sale or other event resulting in commission pay. Disputes often arise when management intervenes during the sales process. When management is involved at some point during a sale, it is important to note the point at which someone procures cause for the sale and who was handling the customer at that point in time. This is the individual who has technically earned the agreed upon commission.

Obtaining Unpaid Commission:

If you feel you are entitled to commission that you never received, seek legal counsel. Employers frequently change compensation plans, utilize unfair provisions and/or adopt a very narrow interpretation of a commission agreement or plan. In some cases, employers are forced to seek unpaid commission post-employment. It’s important to note that employees who no longer work for a company can still be due commission on sales procured during their employment. Employers can’t reap the benefit of your efforts while simultaneously ignoring the agreement to provide you with a commission for those same efforts.

Employers will often work their compensation plans in various ways in order to justify commission forfeiture with little to no cause. Examples include employers who add verbiage making commission payment “exclusive” to current employees or allowing the employer to alter the commission agreement in certain situations, etc. California wage laws can help former and current employees recover commissions. The courts may see the commission agreement differently than your employer.

Call Blumenthal, Nordrehaug & Bhowmik today and find out how your unique circumstances can be taken into consideration when attempting to obtain unpaid commissions. 

Defining the Written Employee Contract

There are times when an employee is asked to sign a written employee contract. Before we can discuss when you should and should not consider agreeing to sign such a document, it’s important that we clearly agree on an exact definition.

What is a Written Employee Contract?

A written employee contract is a document provided (typically during the hiring process) to set forth terms of the relationship between the employer the employee. Both you and the employer sign the document. Entering into a written contract is not necessary with every position. Actually, use of the written employee contract is an exception to the normal practice during the hiring process – not the rule. But it is important to know what this particular type of document entails so that you can better understand when it might be appropriate or even possibly advantageous to agree to sign on the dotted line.

What is Included in a Written Employee Contract?

The written employee contract will clearly state the employee’s job description. It will also clearly state the agreed upon salary. In addition to this other items related to the employment relationship can be specified including: the length of the job (1 month, 2 years, indefinite, etc.), additional information regarding the employee’s responsibilities on the job, limitations on employee activity once the job is complete in order to avoid competition, protection of the company’s trade secrets/client lists, specified grounds for termination, additional benefits (vacation, disability leave, health benefits, etc.), ownership rights of employee’s work during the duration of the contract, methods agreed upon for resolution of any disputes arising as a result of the employment relationship, etc.

The written employee contract isn’t just one more piece of paperwork dragging the hiring process out. In some instances, it can be a vital element that protects both the employer and the employee from negative situations that could damage team morale, employer/employee relations, your ability to successfully complete the job at hand or your opportunity to fully enjoy the full extent of benefits that were promised during the hiring process.

Find out more about the advantages and disadvantages of signing a written employee contract in upcoming articles here on the Blumenthal, Nordrehaug & Bhowmik blog or get in touch today to talk to a legal expert on employment law.