Hamburger, Maxson, Yaffe & McNally, LLP July 29, Original Content

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1 HMYLAW Hamburger, Maxson, Yaffe & McNally, LLP July 29, 2014 Original Content School Volunteer Not Entitled to Wages or Overtime Discrimination Claim Against Supervisor Survives Employer s Bankruptcy Discharge Appellate Court Upholds Volunteer Firefighter Termination School Volunteer Not Entitled to Wages or Overtime In Brown v. N.Y.C. Dep t of Education, the Second Circuit Court of Appeals recently affirmed the denial of back pay and other benefits to a man who volunteered in New York City s public school system for more than three years, concluding that volunteer status is an issue of law for the court to decide. The federal district court awarded the Department of Education ( DOE ) summary judgment on Brown's federal claim for relief under the Fair Labor Standards Act of 1938 ( FLSA ), concluding as a matter of law that Brown was not entitled to statutory minimum and overtime wages for the three years he worked at DOE's Banana Kelly High School ( Banana Kelly ) because Brown had served as a public agency volunteer, not an employee. The Court summarized the facts as follows. Jayquan Brown graduated in 2006 from DOE's New School for Arts and Sciences ( New School ), located in the South Bronx. At that time, New School shared physical space with Banana Kelly so that Brown came to know the staff at both schools. He was unable to secure paid employment after graduation, but did assist his brother who was working as a group leader for younger students at an after-school program at C.S. 92. On a visit back to New School in or about October 2007, Brown mentioned his mentoring work at C.S. 92 to Daniel Jerome, Banana Kelly's director of student life. Jerome asked Brown if he would be interested in mentoring students at Banana Kelly. When Brown responded affirmatively, Jerome raised the matter with principal Laub. Laub determined that Brown lacked the higher education and personal criteria necessary for a paid staff position; nevertheless, Laub bent some rules to create what he described to Brown as a volunteer internship. At his deposition, Laub stated that he did this to advance his career opportunities. Meanwhile, Brown has professed not to have fully appreciate[d] what was

2 meant by the terms intern and volunteer. He acknowledged, however, that he was never required to provide any qualifications for employment at Banana Kelly and was never told by any school official that he would be paid for his work. Nor did Brown himself initially inquire as to compensation. Rather, he accepted Laub s offer in order to build his resume; to model himself on Jerome, whom he admired; and to be a person who could stand up, and make a change, and show the kids that we do care. Brown worked at Banana Kelly from the fall of 2007 through December He generally spent five days a week (and frequent Saturdays) at the school for approximately forty hours per week and, in 2009, also assisted during the summer session. Brown explained that Jerome told him he was needed five days per week; therefore, he did not think that he had any choice but to come in that frequently because if I didn t, I would be letting him [i.e., Jerome] down, and I would be letting the school down. He acknowledged that on the few occasions when he was absent, he was neither criticized nor disciplined. On various occasions, Brown asked Laub for a paid position. Laub generally responded negatively, citing budget constraints and Brown s lack of higher education. Laub did consider the possibility of offering Brown a part-time paid position and, on one occasion, told Brown that he would search the budget for the necessary money. Nothing materialized, however, and Brown has admitted that neither Laub nor Jerome ever told him that he was going to be paid for his work. Nevertheless, Brown asserted that Laub and Jerome created an impression that money to pay him was forthcoming when, in 2010, Jerome informed the I Team that Laub had applied for a $170,000 grant to support its work by, among other things, providing stipends for interns. Apparently, no grant was ever received. Meanwhile, when Brown inquired as to a paid position as a school aide, Laub and Jerome encouraged him to seek such a position at another DOE school. Brown did seek aide positions at other schools because he wanted to get paid. In 2009, with a letter of recommendation from Jerome, Brown secured a paid part-time evening job with a security company. From time to time but on fewer than five occasions in total Laub gave Brown cash in amounts ranging from $40 to $50, telling him that he was doing a great job and should keep up the good work. Brown testified that he did not know why Laub was giving him this money and did not think it was for his work. Meanwhile, Brown asserted that in recognition of his working all day without pay and doing a great job, Jerome gave him $60 per week approximately 10 to 20 times, as well as occasional Metro Cards and subway fare. Both Laub and Jerome sometimes paid for Brown's meals. On January 4, 2012, Brown commenced his action against DOE, alleging a failure to pay him minimum and overtime wages as required by the FLSA. Key to the district court s granting of summary judgment is a volunteer exception in the FLSA. In 1985, Congress specifically codified an FLSA exception for individuals who volunteer their services to public agencies such as DOE subject to two conditions:

3 The term employee does not include any individual who volunteers to perform services for a public agency which is a State, a political subdivision of a State, or an interstate governmental agency, if (i) the individual receives no compensation or is paid expenses, reasonable benefits, or a nominal fee to perform services for which the individual volunteered; and (ii) such services are not the same type of services which the individual is employed to perform for such public agency. Under U.S. Department of Labor regulations, a person qualifies as a volunteer if they have a civic, charitable, or humanitarian purpose, they are neither promised nor expect to be paid, they worked without pressure or coercion, and they were not otherwise employed by the same public agency to perform the same type of services as those for which the individual proposes to volunteer. Volunteers can still be paid expenses, get reasonable benefits and even a nominal fee without triggering an obligation for minimum and overtime wages. The Court reasoned that the exemptions are to be narrowly construed against the employers seeking to assert them, but was mindful that in the case of the volunteer exception, Congress did not intend to discourage people from volunteering for a civic, charitable or humanitarian purpose. The Court concluded that the obligation to construe the exception narrowly does not contemplate the imposition of judicial limits not intended by either Congress or the implementing agency, particularly where those limits would further a result discouraging or impeding volunteer services to public agencies that Congress and the agency expressly disavow. In this respect, common sense and human experience inform our consideration of Brown s urged exclusive-purpose limitation, the Court ruled. They instruct that human actions are frequently informed by multiple reasons. In Brown s case, the Court concluded: The fact that this unemployed, recent high school graduate hoped also to build his resume and to emulate his role model does not legally precluded a court from finding him to have served as a public agency volunteer exempt from the FLSA s minimum and overtime wage requirements. As for the cash and benefits Brown received, the Court concluded that this cannot reasonably be deemed compensation so as to preclude application of the exception.

4 Discrimination Claim Against Supervisor Survives Employer s Bankruptcy Discharge In Mohammed v. Great Atlantic & Pacific Tea Co. Inc., a New York County Supreme Court recently held that an employee s claim against his supervisor for aiding and abetting the corporate employer s alleged violation of the State s and New York City s human rights laws survive the bankruptcy discharge in the employer s Chapter 11 bankruptcy case. Traditionally, a plaintiff could not successfully file a suit simultaneously against her employer and an individual employee, typically a manager or supervisor, based upon a claim of employment discrimination. For instance, under federal law, such as Title VII and the Age Discrimination in Employment Act (ADEA), there are no provisions that impose individual liability upon a co-employee. The State s and New York City s human rights laws provide the exception. Pursuant to NY Exec. Law 296(6) (New York s Human Rights Law), [i]t shall be an unlawful discriminatory practice for any person to aid, abet, incite, compel or coerce the doing of the acts forbidden under [the Human Rights Law], or to attempt to do so. A corporate supervisor or manager may be subject to personal liability only where the supervisor or manager has been deemed an employer within the meaning of the law. According to the New York Court of Appeals, a corporate manger or supervisor is not considered an employer unless he is shown to have an ownership interest in the corporation or any power to do more than carry out personnel decisions made by others. To determine whether an individual defendant is an employer within the meaning of the State law, the courts examine whether the alleged employer: had the power to hire employees; made the payment of salary or wages to the employee; had the power of dismissal over the employee; and had the power to control the employee's conduct. In order for a plaintiff to state a claim against an aider or abettor she must allege that the individual defendant engaged in conduct protected by the Human Rights Law; there is a causal connection between the protected conduct and the alleged violations of the Law; and that the individual defendant actually participated in the discrimination. In this case, the Court recognized that [b]oth Human Rights Laws which are remedial in nature should be given a liberal construction. It reasoned that because there was no finding by the bankruptcy court regarding the merits of the employee s discrimination claims against the corporate employer, the claims against the supervisor remain actionable. The Court relied upon the general law that rights in existence at the bankruptcy proceeding, but not addressed therein, remain actionable in state court.

5 Appellate Court Upholds Volunteer Firefighter Termination In Pasqua v. Village of Mamaroneck Fire Department, an Appellate Court reversed a Supreme Court s reinstatement of a volunteer firefighter who was terminated by the department after a hearing for abusive language and refusing to follow orders. In New York, a member of a volunteer fire department may not be removed from membership except for incompetence or misconduct. Under New York s General Municipal Law, removal on the ground of incompetence or misconduct, except for absenteeism at fires or meetings, may be made only after a hearing upon due notice and upon stated written charges and with the right of such member to a review by the Supreme Court under Article 78 of the CPLR. The burden of proving incompetency or misconduct is upon the person alleging it. According to the decision, after a hearing, the petitioner s membership in the Village of Mamaroneck Fire Department, a volunteer fire department, was terminated, based upon his verbally abusive conduct directed to fellow firefighters during the course of a fire, and his failure to follow direct orders, including an order directing him to leave the scene of an emergency because he was not attired in proper gear. At the hearing leading to his termination, a reference was made to the petitioner s prior assault of a line officer, resulting in a prior suspension. The petitioner did not testify at his hearing and following the hearing he was terminated. In September 2012, a Westchester Supreme Court reduced the penalty to a 29-month suspension and credited the petitioner for the period of suspension he had already served. The fire department appealed and the Appellate Division, Second Department, reversed the Westchester Supreme Court. The Appellate Division reasoned that an administrative penalty must be upheld unless it is so disproportionate to the offense as to be shocking to one s sense of fairness, thus constituting an abuse of discretion as a matter of law. The petitioner s conduct endangered himself and distracted his coworkers while they were fighting the fire, thus possibly endangering them as well. Under these circumstances, the penalty of termination of membership was not shocking to one s sense of fairness. Original Content