Most employment claims can be avoided by simply being aware of what the law requires.  Here are three recurring issues which plaintiffs’ class action attorneys and government agencies are targeting across the country and which can be easily avoided by taking action now.

1.  Misclassification of Workers as Independent Contractors

The Internal Revenue Service (IRS) and US Department of Labor (US DOL) have been increasingly cracking down on independent contractor misclassification.  Last year, Massachusetts, along with several other states, signed a Memorandum of Understanding (MOU) with the IRS and  DOL, formally agreeing to cooperate in investigating independent contractor misclassifications.  If a violation occurs, the government agency investigating the matter is obligated to report it to the other state and federal agencies which may be affected by the misclassification, potentially opening up the company to an audit by the IRS or the US DOL.

Massachusetts has one of the toughest tests to be met in order to classify someone as an independent contractor, and the penalties for misclassifying vary with the legal requirement which was not met as a result of the misclassification.  For example, if a worker was not paid accrued wages or vacation time upon termination, the … Keep reading

While non-lawyers may not have heard of the term “spoliation,” most people intuitively know that destroying evidence related to an ongoing litigation is a bad thing to do.  Conversely, even many lawyers do not know the breadth of a company’s obligation to preserve evidence, particularly electronically stored information (which is quaintly referred to as “ESI”).  Further, knowing the basics of this obligation is critical because failing to preserve ESI can lead to monetary penalties, affirmative claims being dismissed and/or defenses being barred.

Perhaps the most common misconception about the obligation to preserve ESI is that a company runs no risk of punishment for having destroyed ESI pursuant to a document retention/destruction policy, as long as such policy (i) is objectively reasonable and (ii) was  implemented at a time when no litigation could have been anticipated.  Further, at first glance, Rule 37(e) of the Federal Rules of Civil Procedure would appear to support this notion:

Absent exceptional circumstances, a court may not impose sanctions under these rules on a party for failing to provide electronically stored information lost as a result of the routine, good-faith operation of an electronic information system.

While this rule seems simple enough, the … Keep reading