A new Labor Department rule attempted to make more employees eligible for overtime pay, but was halted by a federal judge. Under the rule, salaried workers who earn less than $59,000 a year must be compensated fairly for overtime work. Overtime pay of 150% of regular pay is not required to be paid to workers in certain capacities who make over a certain minimum. Those exceptions include executive, administrative, or professional capacities. To avoid paying the overtime, the employer must show that the worker qualifies in one of those exceptions and is paid over the designated minimum. During the Trump administration, the salary threshold was $35,568, above which employees do not have full protection. On July 1, 2024, the threshold increased to $43,888, and on January 1, 2025, it will rise to $58,656. The change could affect 4 million workers. As with the FTC non-compete rule, this rule was promptly challenged in court.

Well, never mind!

UPDATE: Within a few weeks of my initial blog posting, the rules changed yet again. This is typical for the modern regulatory environment, where every rule is challenged in court.

The DOL’s new overtime regulations were scheduled to go into effect on January 1, 2025. However, on November 15, 2024, a judge from the US District Court for the E.D. Tex invalidated it entirely.

With the court’s ruling, the number remains at the previous $35,568. There has been, and remains, an exemption for highly compensated employees making over $107,432, meaning those making that much need not be paid overtime. In between, whether employees are entitled to overtime depends on an assessment of factors relating to their job duties,

Given the recent election, it is likely that the DOL will not pursue an appeal. In any event, the injunction is likely to be in place for a significant period of time.

If you aren’t sure whether employees are entitled to overtime, seek legal counsel. The penalties for not paying an employee overtime he or she is entitled to are severe, and can reach back for years.

---

Peter Juran brings over 30 years of litigation experience, having tried cases to verdict before juries, judges, and arbitrators. He advises clients on employment law, construction disputes, intellectual property, real estate, corporate governance, and trust and estate matters. Certified as a mediator, Peter also conducts Superior Court Mediated Settlement Conferences. Known for his strategic approach, he helps clients navigate complex disputes, whether through negotiation or litigation, to achieve the best possible outcomes.

 

In my Outside General Counsel Services practice I tend to review a fair number of contracts sent to my clients. Most of the agreements are preprinted forms from trade vendors, suppliers, or service providers and many tend to be pretty lengthy for the average person to wade through. I always appreciate my clients sharing these contracts with me and asking for my advice on the legal terms which are buried within the 17 or more pages of 8 point type which comprise the standard form contract. It means they are concerned about the legal terms that might be included in the contract and want a professional opinion on whether those terms are overreaching.

Many business owners tend to focus on the business terms disclosed in the contract, and if that matches their understanding of the “deal” they often gloss over all the “legalease” which makes up the remainder of the agreement. Unfortunately, that can be a costly mistake later in the life of the relationship between the parties when something goes wrong, and the client wants to know if it can “get out of the contract,” sue the other party for breach of the agreement or recover some damages it believes the other party to the contract has caused.

Whether you fall into the category of the business owner who seeks legal advice before you sign most contracts, or the business owner who tends to focus solely on the business terms, this article will help you hone in on those legal provisions in contracts which are vitally important, and most often result in disappointment if a contractual relationship later turns sour.

Every contract contains legal provisions regarding standard boilerplate terms and conditions. Those terms and conditions may include provisions which tend to protect the drafting party, to the detriment of the countersigning party. Here are a few contractual provisions all business owners should pay particularly close attention to when signing any contract for goods or services:

Limited Warranty Provisions – Many companies who sell goods or services, or both, will try to limit the warranties made respecting the goods they sell or the services they provide. There is nothing inherently wrong with limiting the kind of warranty that a business will provide to its customers. That said, you should always review the warranty provisions in a contact and make sure that provision does not completely eliminate all warranties. I am always surprised when a business presents a contract which says it provides no warranties whatsoever respecting the good or services provided under the contract. At a minimum, a business should warrant that it has good title to the goods it is selling and that the goods are fit for the purpose intended, or that the services provided will be performed in a workmanlike manner according to industry standards. If a business is not willing to give these minimum warranties, you may want to consider moving on to another vendor or provider.

Limitation of Liability Provisions – It has become quite common for business contracts to limit the liability of a contracting party. This can take the form of a waiver of certain types of damages, such as consequential damages, lost profits, special, incidental, indirect, exemplary, or punitive damages resulting not only from performance or non-performance under the contract, but also under tort theories for negligence, strict liability, warranty, indemnity or in equity. These provisions are often one-sided, meaning both parties do not have the same limitations and restrictions. At a minimum, you should insist that such provisions are mutual and limit the liability for both sides to the contract. Alternatively, liability may be limited by limiting the total monetary amount of the damages arising under the contact to some formula based upon the amount of product purchased or the dollar amount of services provided during the contact. For instance, the contract may limit the total recovery to the amount paid for the purchase price of a good involved in the dispute or the amount paid for the services involved in a dispute. These sometimes result in dramatic limitations of recoverable damages.

Statute of Limitations Reduction Provisions – Some contracts will attempt to reduce the amount of time you have to sue for breach of contract as compared to the amount of time permitted under state law. While this is not improper in business contracts, it is something to take note of, and resist if the temporal period proposed is unreasonable.

Indemnification and Hold Harmless Provisions – Indemnification provisions are some of the most complicated and often misunderstood provisions in contracts. Again, they are often drafted as one-sided agreements which only protect and indemnify the drafter of the agreement. Indemnification provisions may require a party to defend a lawsuit brought by a third party against the indemnified party arising out of the contract, indemnify the risk of loss and damages for claims and suits brought by a third party against the indemnified party, and hold harmless the indemnified party from the claims asserted against them by a third party resulting from the contract. You should insist on mutual indemnification under the contract. Often these provisions seek an indemnification regardless of the negligence of the indemnified party and only exclude from the indemnification gross negligence or willful and malicious acts of the indemnified party. Because of the varied and complex nature of these provisions, unless you clearly understand the obligations you are committing to, and the rights you are potentially waiving, you should seek advice of counsel on this critical legal provision in a contact.

Shipping Terms and Risk of Loss – When a contract involves the purchase of goods which will be transported through interstate or international commerce, you should always be certain of where the risk of loss is, should something happen to those goods during shipment. If title to the goods passes once the goods are delivered by the supplier to a carrier, then the risk of loss is on you the purchaser and you should make certain you have adequately insured the goods from the risk of loss during transit. Most contracts are drafted in this manner. Some contracts are drafted where title remains with the seller until the goods reach their destination and title does not pass until the goods are delivered. In those situations, the seller is responsible for the risk of loss to the goods. Pay close attention to shipping terms and when the risk of loss passes to you as the buyer.

Termination Rights – Is the contract for a set term of months or years? Does it renew automatically if notice of termination is not provided? Does notice of termination need to be provided by a certain number of days or months in advance of the termination date? Do you even have a right of termination? Are there rights to cure defaults, and if so, is notice required for exercising a right of termination? All of these are important considerations. Knowing and understanding how you get out of a contract is an important consideration. You should always seek a right to terminate a contract upon a limited notice to the other party.

Dispute Resolution – Does the contract contain restrictions on how disputes about the contract or performance under the contract are resolved? Many business contracts contain mandatory arbitration provisions or mediation provisions to replace, or precede traditional litigation in state or federal court. You should know your rights and responsibilities under an alternative dispute resolution provision, which may include paying or sharing the cost of the mediation or the arbitration proceeding, a shifting of attorneys’ fees incurred by the parties, or binding decisions by tribunals other than a court of law. In addition, many such contracts include waivers of a right to a jury trial, a required governing law of a state other than the state in which you conduct your business, and a required venue for resolution of the dispute in another state. Read these provisions and make sure you understand the implications of agreeing to the form of dispute resolution provided in the contract.

While all of the provisions of a contract have importance and serve a specific function, these provisions are critical to understand and the most frequently bemoaned or litigated when a contractual relationship falls apart. Understanding them on the front end, and protecting your interests to level the playing field will save you time, money and headache down the road. Take some time to read these provisions, and if necessary, seek the advice of counsel on what the provisions mean, and how they will impact your business.

---

Ashley Rusher brings more than 35 years of experience in business bankruptcies, distressed debt workouts, problem loan recovery, real estate title litigation, and commercial litigation. She delivers practical, results-oriented solutions to clients, representing financial institutions, trade creditors, bankruptcy trustees, and businesses in complex matters such as debt restructuring and title curative litigation. As Outside General Counsel, Ashley provides trusted, business-centered legal advice to help clients achieve their goals.

 

 

 

Employers are often baffled when an employee requests “reasonable accommodations” under the Americans with Disabilities Act, popularly called the ADA. As described by Illinois Senator Tammy Duckworth, the ADA “allows persons with disabilities the opportunity to participate in the world around them.” One major section of this Act requires employers to provide “reasonable accommodations” to workers with disabilities. But what does that mean to an employer?

If an individual with a disability requests accommodation, the employer is required to enter into good faith discussions to determine if an accommodation is needed and, if so, what will accomplish the goal. A reasonable accommodation is broadly defined as a change in a working environment or the hiring process that allows qualified individuals with a disability to complete the essential functions of a job while not having the employer suffer an undue hardship. For example, a reasonable accommodation can be a wide range of things, such as adjusting work schedules or equipment, or changing the workplace environment. However, with such an expansive definition, it can be challenging to determine which accommodation provides the best relief for a situation. Sometimes, “outside the box thinking” is needed to find a creative solution to the employee’s needs.

To help address these issues, the U.S. Department of Labor has recently released an online tool called the “Situations and Solutions Finder.” This resource provides more than 700 real-life examples of reasonable accommodations shared by the Job Accommodation Network, a service offered by the Department’s Office of Disability Employment Policy. Such reasonable accommodations can be filtered by disabilities, limitations, and/or occupations.

While accommodations are unique to each individual, the Situations and Solutions Finder shows common patterns taken by workplaces and presents accommodations that have been considered reasonable for employers to satisfy. Both employers and workers can use this tool as a valuable starting point when exploring potential solutions to best support an employee with a disability. Ultimately, while the Situations and Solutions Finder may not provide a one-size-fits-all answer, it can help guide employers and workers toward the right path in identifying reasonable accommodations for the workplace.

The Situations and Solutions Finder can be accessed here.

If your employee has requested accommodations, be sure to treat the request seriously and respectfully and, if needed, seek legal counsel to ensure that the request is handled in compliance with the law.

---

Taylor Gibbs joined Blanco Tackabery in 2024 as part of the Civil Litigation Practice Group. She earned her B.A. in political science, summa cum laude, with a minor in religious studies from Appalachian State University and her J.D. from Wake Forest University School of Law. During law school, Taylor served as an executive member of Wake Forest’s Black Law Students’ Association and represented the school in regional and national moot court competitions as a member of the Jimmy Quander Moot Court Team.