Equal Pay Act Applies to In-House Attorneys; Reinstatement is Appropriate Remedy

Posted on April 15, 2009 by Grace Healy

Yesterday, the Wisconsin Court of Appeals yesterday affirmed an order reinstating an in-house attorney who had been terminated.  This case applied federal law, so it should be of interest to all in-house counsel -- both terminators and terminatees. 

Defendant in Sands v. Menard contested the affirmance of an arbitration panel’s order requiring reinstatement of defendant’s former executive general counsel.  The arbitration panel had ruled that defendant violated the Equal Pay Act by paying plaintiff less than a similarly situated male employee and had retaliated against her for asserting her discrimination claims. 

In addition to compensatory and punitive damages, defendant was ordered to reinstate plaintiff. The opinion has a fairly long discussion regarding the standard of review, the application of anti-discrimination laws to in-house counsel and the appropriate remedies for violation of those laws.  The bottom line in the opinion is that the defendant failed: “to explain how Wisconsin law regarding clients’ rights to choose their attorneys, or the rules of professional conduct, could negate the remedies of wrongfully terminated employees under federal law.”  

This will probably give professional responsibility gurus a lot to discuss.

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NY Appellate Court Dissects Restrictive Covenant Law

Posted on January 27, 2009 by Grace Healy

Given the current state of the economy, an upsurge in restrictive covenant cases seems likely.  Employees who either depend upon bonuses for much of their income, or are expecting a raise, generally become restless when there is no bonus or raise.  Alternatively, employees who worked for relatively small firms may decide to move on when they find themselves working for larger entities -- that twenty years ago would have been a completely different business.  Loyalty to the employer may be, well, not what it used to be. Of course, none of this is really new, it just seems more  pervasive.

In any event, a recent New York decision regarding investment advisors who left to set up their own business, Ashland Management Inc. v. Altair Investments, is really interesting.  It is the rare case where you read the Appellate Division majority opinion and say – absolutely correct -- and read the two-judge dissent and say – absolutely correct.  The facts recited by the majority strongly suggest wrongdoing; defendants allegedly were taking steps to grow their business while still on the plaintiff’s payroll and had hacked the defendant's computer.  The dissent seems to focus on the fact that New York historically doesn't like to restrain its citizens' ability to earn a living.

The opinions offer and discuss almost all of the issues that come up in these cases (except for measure of damages).  Comparing them gives a pretty good idea of the legal issues faced when they these cases are litigated.

I hope that at some point the case is heard by the Court of Appeals because it presents many issues that are critical to these cases -- the confidentiality of customer lists, the extent to which an agreement may be ‘blue-penciled’ by a court, whether a clause must contain a set duration – or if no duration is a duration, which may or may not be reasonable -- and the consideration necessary for imposing a restrictive covenant.  Questions that come up over and over in cases that are litigated frequently, usually at great speed.
 

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