Articles Posted in Labor & Employment Law

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Plaintiff Clifton Arbuckle sustained a work-related back injury while working for General Motors Corporation (GM), and in May 1993 began receiving a disability pension. He retired that month and was subsequently awarded workers’ compensation benefits. Later, he also received Social Security Disability Insurance (SSDI) benefits. GM and the International Union, United Automobile, Aerospace and Agricultural Implement Workers of America (UAW) had executed a letter of agreement in 1990 in which GM agreed not to coordinate workers’ compensation and disability pension benefits for its employees under MCL 418.354. This letter of agreement was incorporated into the 1990 collective-bargaining agreement (CBA) between GM and the UAW and was intended to remain in place until termination or amendment of the CBA, which expired in November 1993. When the CBA expired, however, the provision against coordination was continued in subsequent letters of agreement and incorporated into subsequent CBAs. In 2009, GM and the UAW adopted a formula (incorporated into the 2009 CBA) by which GM would coordinate benefits, using disability pension benefits to reduce the amount of workers’ compensation benefits for all workers and retirees, regardless of when they had retired. GM advised Arbuckle that effective January 1, 2010, his benefits would be reduced using the formula in the 2009 agreement. Arbuckle appealed to the Workers’ Compensation Agency, which ultimately concluded that GM was improperly using Arbuckle’s SSDI benefits to offset his workers’ compensation benefits, in violation of MCL 418.354(11). A workers’ compensation magistrate reversed the director’s ruling but nevertheless concluded that GM was prohibited from reducing Arbuckle’s workers’ compensation benefits by his disability pension benefits because Arbuckle had never agreed to coordination of benefits and no evidence established that the UAW had the authority to bargain on Arbuckle’s behalf after his retirement. The Michigan Compensation Appellate Commission (MCAC) reversed in part, holding that irrespective of the UAW’s authority to bind retirees, GM was permitted to coordinate Arbuckle’s disability pension benefits. Arbuckle sought leave to appeal, but after the Court of Appeals granted his application, he died. Robert Arbuckle, the personal representative of the estate, was substituted as plaintiff. The Court of Appeals reversed in an unpublished opinion per curiam and remanded the case for further proceedings. GM then appealed. The Supreme Court concluded after its review that the Court of Appeals erred in holding that GM lacked the authority to coordinate Arbuckle’s benefits under the 2009 CBA. The Court reversed and reinstated MCAC's order. View "Arbuckle v. General Motors, LLC" on Justia Law

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In 1993, plaintiff Dean Altobelli began working as an attorney for Miller, Canfield, Paddock and Stone, P.L.C. (“the Firm”). Upon joining the Firm, plaintiff signed the “Miller Canfield Operating Agreement” (“Operating Agreement”), a document governing the Firm’s internal affairs. By January 2006, plaintiff had become a senior principal at the Firm. However, in late May or early June 2010, plaintiff decided he wanted to pursue a new opportunity as an assistant coach for the University of Alabama football team. Plaintiff proposed a 7- to 12-month leave of absence from the Firm to defendant Michael Hartmann, the Firm’s CEO, and defendant Michael Coakley, who was the head of the Firm’s litigation group but was not a managing director. Plaintiff suggested that the Firm permit him to maintain his ownership interest and return to the Firm as a senior principal any time before June 1, 2011. Plaintiff avers that Hartmann initially promised plaintiff that he could spend as much time at the University of Alabama as he wanted and still receive certain allocated income from his clients. Hartmann disputed this, claiming that plaintiff voluntarily withdrew from the partnership. Plaintiff claimed he was improperly terminated, and that the Firm shorted plaintiff's income as a result. Plaintiff's attempt to resolve the matter through the direct settlement and mediation process, as outlined in the arbitration clause of the Operating Agreement, was unsuccessful. In November 2011, plaintiff filed a demand for arbitration as provided for in the arbitration clause. Despite having made the demand for arbitration, he filed suit alleging that the seven individuals named as defendants were responsible for engaging in tortious conduct with regard to plaintiff's request for a leave of absence and retention of his equity ownership in the Firm. Defendants moved for summary judgment and a motion to compel arbitration as required by the arbitration clause. Plaintiff moved for summary judgment too. The circuit court denied defendants’ motions and granted plaintiff's motion for partial summary judgment, finding as a matter of law that plaintiff did not voluntarily withdraw from the Firm. Rather, the circuit court concluded that defendants had improperly terminated plaintiff's ownership interest without authority. The Court of Appeals affirmed. The Supreme Court reversed the part of the Court of Appeals’ opinion regarding the motion to compel arbitration and instead held that this case was subject to binding arbitration under the arbitration clause of the Operating Agreement. Accordingly, the lower courts should not have reached the merits of plaintiff’s motion for partial summary disposition, as the motion addressed substantive contractual matters that should have been resolved by the arbitrator. The case was remanded back to the trial court for further proceedings. View "Altobelli v. Hartmann" on Justia Law

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Defendant city of Lansing enacted an ordinance requiring contractors working on city construction contracts to pay employees a prevailing wage. Plaintiff Associated Builders and Contractors, a trade association, filed suit against Lansing, arguing that the ordinance was unconstitutional because municipalities did not have the authority to adopt laws regulating the wages paid by third parties, even where the relevant work is done on municipal contracts paid for with municipal funds. The Court of Appeals majority disagreed, and ruled that subsequent changes to state law had caused the controlling caselaw precedent, Attorney General ex rel Lennane v Detroit, to be “superseded.” The Supreme Court reversed, finding that the Court of Appeals erred by exceeding its powers for refusing to follow a decision from the Michigan Supreme Court that both applied and had not been overruled. Even so, the Supreme Court took the opportunity to overrule Lennane because subsequent constitutional changes "undercut its viability." The Court therefore vacated the Court of Appeals’ decision but affirmed the result. View "Associated Builders & Contractors v. City of Lansing" on Justia Law

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The issue this case presented for the Supreme Court's review in this matter focused on the application of Michigan's Whistleblowers' Protection Act (WPA) to an employee who alleged that she was terminated because she reported a coworker’s plan to violate the law. Because "a violation or a suspected violation" refers to an existing violation of a law, the plain language of MCL 15.362 contemplated an act or conduct that has actually occurred or was ongoing. "MCL 15.362 contains no language encompassing future, planned, or anticipated acts amounting to a violation or a suspected violation of a law." Because plaintiff in this case merely reported another’s intent to violate a law in the future, plaintiff had no recourse under the WPA. The Supreme Court reversed the Court of Appeals’ contrary decision and remanded this case to that court for further proceedings. View "Pace v. Edel-Harrison" on Justia Law

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The Michigan Coalition of State Employee Unions and others brought an action in the Court of Claims against the State and various state agencies and officers, alleging that portions of 2011 PA 264, which amended the State Employees’ Retirement Act (SERA, MCL 38.1 et seq.), were unconstitutional because the resulting changes to retirement benefits altered rates of compensation or conditions of employment, which were within the exclusive authority of the Civil Service Commission to regulate. The Court of Claims granted plaintiffs’ motion for summary judgment. The Court of Appeals affirmed in part, reversed in part, and remanded, holding that SERA retirement benefits were properly classified as both “rates of compensation” and “conditions of employment,” neither of which was subject to legislative alteration. The Supreme Court reversed. "While the [Civil Service Commission] has considerable constitutional powers to manage the civil service system and to preserve its sphere of constitutional authority, the commission has no legislative powers. It may neither enact legislation nor revise an enactment, nor may it dictate that the Legislature repeal or modify an enactment. Therefore, we hold that because the commission has acquiesced in the application of SERA to the employees of the civil service system, plaintiff’s objections fail to establish a basis for relief." View "Michigan Coalition of State Employee Unions v. Michigan" on Justia Law

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The International Union, United Automobile, Aerospace, and Agricultural Implement Workers of America and others brought an action in the Court of Appeals against Nino Green and other members of the Michigan Employment Relations Commission, the Governor, and the Attorney General, seeking a declaratory judgment that portions of 2012 PA 349 (which amended the public employment relations act (PERA, MCL 423.201 et seq.), to prohibit public employers from requiring their employees to join a union or pay union-related expenses) were unconstitutional with respect to employees in the classified state civil service. The Court of Appeals held that the challenged portions of 2012 PA 349 were constitutional. Although the Supreme Court concluded that public collective bargaining was a method by which the Civil Service Commission (could choose to exercise its constitutional duties, the Court held that the commission could not effectively require civil servants to fund the commission’s own administrative operations. Accordingly, the Supreme Court affirmed the Court of Appeals on different grounds. View "UAW v. Green" on Justia Law

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The issue this case presented for the Supreme Court's consideration was whether defendant lifeguard's failure to intervene in the deceased's drowning was "the proximate cause" of his death. While governmental agencies and their employees are generally immune from tort liability under the governmental tort liability act (GTLA), MCL 691.1407(2)(c) provided an exception to this general rule when a governmental employee's conduct is both (1) grossly negligent and (2) "the proximate cause" of an injury, which the Michigan Supreme Court interpreted to mean the "most immediate, efficient, and direct cause". Plaintiff sued defendant, a governmental employee, arguing that governmental immunity did not apply because defendant's grossly negligent behavior while lifeguarding and resulting failure to rescue plaintiff's drowning son was the proximate cause of his death. Subsequently, defendant moved for summary judgment on immunity grounds, but the trial court denied defendant's motion. The Court of Appeals, in a split opinion, affirmed, concluding that a jury could reasonably find that defendant's failure to intervene constituted the proximate cause of the deceased's death. The Court of Appeals dissent instead concluded that defendant was immune from liability. After review, the Supreme Court held that the trial court erred by denying summary judgment to defendant, because the exception to governmental immunity articulated in MCL 691.1407(2) was inapplicable in this case. View "Beals v. Michigan" on Justia Law

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The Michigan Supreme Court granted leave to appeal to address the constitutionality of 2012 PA 300, which modified the retirement benefits of current public school employees. Plaintiffs, which were various labor organizations representing such employees, raised three constitutional challenges: (1) whether the act violated the prohibitions of uncompensated takings in the Michigan and United States Constitutions, Const 1963, art 10, section 2 and US Const, Ams V and XIV; (2) whether the act impaired the obligation of contracts in violation of the Michigan and United States Constitutions, Const 1963, art 1, sect. 10 and US Const, art I, sect. 10, cl 1; and (3) whether the act violated the guarantee of due process in the Michigan and United States Constitutions, Const 1963, art 1, sect. 17 and US Const, Am XIV, sect. 1. After considering each of these challenges, the Michigan Court held that the act did not violate any provision of either the Michigan or the United States Constitution. View "AFT Michigan v. Michigan" on Justia Law

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Carnice Hodge brought an action to appeal the Unemployment Insurance Agency’s determination that she was disqualified from receiving unemployment benefits under a section under the Michigan Employment Security Act (MESA) that disallows benefits for individuals discharged for work-related misconduct, after respondent U.S. Security Associates, Inc., terminated her employment as a security guard at Detroit Metropolitan Wayne County Airport. Hodge was fired for accessing publicly available flight departure information on a computer near her post at the request of a traveler in violation of respondent’s policy regarding the unauthorized use of client equipment. An administrative law judge affirmed the denial of benefits, as did the Michigan Compensation Appellate Commission (MCAC), but the Wayne Circuit Court reversed. The Court of Appeals granted the employer's application for leave to appeal and affirmed, holding that the circuit court had not erred by concluding as a matter of law that claimant’s behavior was a good-faith error in judgment rather than misconduct. After review, the Supreme Court reversed, finding that the circuit and appellate courts applied an incorrect standard of review by substituting their own assessment of the seriousness of Hodge's conduct for the assessment of the MCAC. Accordingly, the Supreme Court reversed the Court of Appeals and reinstated the MCAC's judgment. View "Hodge v. U.S. Security Associates, Inc." on Justia Law

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While working on a fall clean-up job for defendant All Star Specialists Plus, Inc., defendant Joseph Derry was loading leaves into a truck using a leaf vacuum machine when the machine tipped over, injuring him. At the time, All Star had three insurance policies issued by Auto-Owners Insurance Company: (1) a commercial general liability policy, (2) a commercial automobile insurance (no-fault) policy, and (3) a commercial workers’ compensation policy. The general liability policy excludes from coverage “[a]ny obligation of the insured under a workers[’] compensation . . . law,” and the no-fault policy excludes coverage for “any expenses that would be payable under any workers[’] compensation law . . . .” Derry brought a negligence suit against All Star and one of its owners, Jeffery Harrison, for his injuries and sued Auto-Owners for no-fault benefits. Plaintiff Auto-Owners later filed this declaratory judgment action, seeking a determination that Derry was an employee of All Star and, thus, that the only insurance coverage available was under the workers’ compensation policy. The trial court concluded that because it was uncontroverted that Derry held himself out to the public to perform the same services as the work he performed for All Star, Derry was an independent contractor at the time of his injury and not an employee, and that Derry was therefore entitled to coverage under Auto-Owners’ general liability and no-fault policies. The court denied Auto-Owners’ motion for summary judgment and granted summary judgment in favor of Derry. Auto-Owners appealed to the Court of Appeals, and the panel affirmed in part and reversed in part. The panel affirmed the trial court’s conclusion that Derry was an independent contractor for purposes of the Worker's Disability Compensation Act (WDCA). However, the panel only reached this conclusion because it was bound under MCR 7.215(J)(1) to follow the Court of Appeals’ prior decision in "Amerisure." A special panel was convened, and in a published 4-3 decision, the majority reversed the trial court’s order granting summary judgment in favor of Derry and, thus, its determination that Derry was an independent contractor. Because the Supreme Court believed the term “employee” as defined in the WDCA was properly interpreted in "Amerisure," the Court reversed the Court of Appeals. View "Auto-Owners Insurance Co. v. All Star Lawn Specialists Plus, Inc." on Justia Law