Ohio Court of Appeals Shows that Violating a Non-Compete and Court Order Can Be More Trouble Than It’s Worth

In my experience, there are few industries where employers are more aggressive in enforcing non-competition agreements than in than beauty salons. This week, the Hamilton County Court of Appeals addressed another case involving a hair stylist who just could not say no to his former clients for the non-competition period and ended up paying a steep price for breaching his former employment agreement. Mitchells Salon & Day Spa, Inc. v. Bustle, 2010-Ohio-1880 (4/30/10).

According to the Court’s opinion, the defendant stylist began working for the employer salon soon after graduating from cosmetology school and before he had developed any clients. He signed an employment agreement with a non-competition clause barring him for one year from providing any hair styling, hair care or related services to any client which he had served at the employer at any point during his employment. After working for the employer salon for more than 12 years, he quit in August 2007 and opened his own salon. The employer became suspicious when most of the stylist’s former clients ceased patronizing the employer’s salon and filed suit in January 2008 to enforce the non-competition clause. The trial court entered a TRO in February 2008 prohibiting him from providing any beauty services to the employer’s former clients. The parties then negotiated an injunction which prohibited the stylist from providing for one year – from the date of the February 2008 injunction –any hair styling, hair care or related services to any of the employer’s clients which the stylist had ever served. He also agreed to send each of his clients a letter prepared by the salon informing them that he could no longer serve them and recommending another stylist currently employed by the salon.

The employer salon even offered these clients a discount or free service if they returned. However, it was apparently not enough to shake their loyalty to the errant hair stylist. (I can certainly relate to this). When most of the former clients did not return, the employer hired a private investigator in September 2008 which apparently confirmed that the hair stylist was continuing to routinely serve former clients of the employer. Accordingly, in December 2008 the employer filed a motion to hold him in contempt of the agreed injunction. During the April 2009 contempt hearing, the stylist admitted that he had violated the non-compete and unintentionally violated the TRO and agreed injunction because he had trouble saying “no” to his former clients. He produced a list of 180 clients whom he had served since August 2007 which had been former clients of his employer, but argued that 63 of them were procured personally by him and not by any advertising or promotional campaign by the employer. In all, he claimed that he had made a profit of approximately $37K by serving former clients of his employer in violation of the non-compete, the TRO and the injunction. In response, the employer produced evidence of 39 additional clients which were not on the stylist’s list which the PI had found on a paper calendar in the stylist’s trash.

The employer wanted to be paid for the entire lost profit of $74.1K caused by the stylist’s resignation (i.e., by taking the entire profit he had generated during his last year of employment less the cost of his commission and products) and did not limit itself to the profit lost by the 219 clients served in violation of the non-compete agreement. It also asked to be reimbursed for the $52.6K cost of the PI firm hired to uncover and prove his duplicity and $15.8K in legal fees. The trial court found the stylist in contempt, ordered the stylist to reimburse his former employer only $139K (of the requested $142.5K) and again ordered him to cease serving the clients of his former employer for one year from the date of the contempt order – i.e., until April 2010.

On appeal, the Court affirmed the contempt order. It rejected the stylist’s objections to the salon’s calculation of lost profits on the grounds that he was not provided with the underlying original documents. There is no discussion of the fact that the salon could not have lost all of the profit from his resignation when it still continued to serve and profit from some of his former clients. There is also no discussion of the fact that many – if not most -- of the disputed customers would likely refuse to return to the salon under any circumstances after learning that the salon was more interested in its profits than the condition and style of their hair. However, the court found the salon’s estimate was reasonable in light of the fact that the stylist’s list of the employer’s former clients was materially incomplete in leaving off 39 names.

The court also rejected the stylist’s objection to being required to both pay $139K and cease serving the employer’s former clients for a year. A double penalty is not something that would have been enforced if it had merely been an obligation of the contract. He felt that this was a double punishment and he should only have to pay or cease serving the clients; not both. However, the court of appeals saw it differently:

This is exactly what the trial court did here. The trial court required [the stylist] to disgorge his profits and then ordered [the stylist] to comply with the noncompete clause, which was incorporated into the trial court's agreed entry, for the period of time that [the stylist] had disobeyed the TRO and the agreed entry. These sanctions essentially put the parties in the position they would have been in if [the stylist] had abided by his original agreement for a period of one year not to serve clients to whom he had provided hairstyling services while employed at [the salon]. The extension of the agreed entry for an additional 11 months compensates [the salon] for its future loss of profits. The whole point of the noncompete clause was to give [the salon] the opportunity to retain a client base that it had built through its investment of time, money, and training. The extension gives [the salon] the benefit of its bargain. Accordingly, we cannot say that the trial court abused its discretion in ordering [the stylist] to disgorge his profits and in extending the agreed entry for an additional 11 months. The fourth assignment of error is overruled.

Thus, if the stylist had complied with his non-compete, he would have been free to serve anyone and everyone beginning in August 2008 and would not have owed anything to his former employer. Instead, by continuing to violate the non-compete after agreeing to an injunction, he was barred from serving his former clients until April 2010 and required to pay his former employer over $139K. While it is true that an employer cannot have both an injunction and damages as a matter of contract law, the court refused to permit him to benefit from violating both his contract and a court order. Therefore, he was ordered to comply with his contract, to disgorge any profit he made from violating the contract and court order and to compensate the employer for having to enforce the agreement.

Interestingly, one of the appellate judges indicated that he had sympathy for the stylist’s double penalty argument and would have preferred that the employer elect between the two remedies, but could not undo the injunction period once it had already been completed. In other words, the injunction expired before the court of appeals issued its decision.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

Montgomery County Appellate Court Rejects Perceived Disability Discrimination Claim Based on Prior Accommodations

Last week, the Montgomery County Court of Appeals in Dayton affirmed summary judgment for a public school, although on different grounds than the judgment granted by the trial court. In short, the Court of Appeals ruled that the Political Subdivision and Tort Liability Act (PSTLA) did not apply to bar claims for employment discrimination, but that the plaintiff failed to properly plead or prove a prima facie case for disability discrimination based on her alleged multi-chemical sensitivity allergies. Ogilbee v. Board of Education of Dayton Public Schools, 2010-Ohio-1913, 23432.

According to the Court, the plaintiff clerical assistant alleged that she suffered from multi-chemical sensitivity, which was an allergy to certain perfumes and fragrances which gave her migraine headaches and restricted her ability to breath, sleep, concentrate and walk. Her union refused to assist her when she claimed that her allergies were exacerbated by a new work assignment because it was a "personal problem." She asked HR to be relocated to an empty office or other space or even another building, but these suggestions were rejected as unreasonable. Instead, the school gave her an air purifier and a fan and arranged for a contractor to rearrange her work space. According to the School, she refused to use them without explanation. After she filed a Charge of Discrimination, the School entered into a negotiated settlement agreement and transferred her to another position in another building. The School again attempted to accommodate her by permitting her to annually explain to her co-workers her need for them to not wear perfume, but she believed that after a year that some staff purposely "doused" themselves in perfume and the principal began acting on her complaints less and less. By 2006, the principal would no longer permit her to make her annual announcement. When she arrived at work with a note from her physician indicating that she needed to work in a space free from perfumes and strong odors because they exacerbate her migraine headaches and she had exhausted her paid leave, the School responded shortly thereafter by placing her on a one-year unpaid medical leave of absence because her requested accommodation was unreasonable in that she worked "in a reception area at a public school with over 800 students, 100+ employees, and the public who visit the school on a daily basis. There is no way that a scent-free environment can be guaranteed." When the School refused to reinstate her the following year when there had been no change in her medical condition, she filed a lawsuit in state court alleging disability discrimination and harassment. The trial court found that the School had PSTLA immunity.

Generally, under the PSTLA, "political subdivisions are not liable in damages for injury, death, or loss caused by them in connection with the execution of their functions. See R.C. 2744.02(A)(1). The PSTLA however does not apply to claims by an employee that relate to any matter that "arises out of the employment relationship." R.C. 2744.09(B)." Mysteriously, the trial court concluded that an employment discrimination claim does not arise out of the employment relationship and is more akin to an intentional court. In light of contrary authority to the contrary, the appellate court had no difficulty finding otherwise.

As for her disability discrimination claim, the court construed her argument as applying on to a perceived disability claim and concluded that the plaintiff failed to prove that the School's HR Director perceived her allergy and migraine headaches to substantially limit any major life activities, including working. In particular, the Court rejected her argument that the School must have perceived her as disabled because it made several attempts to accommodate her allergy:

While lay people may think of an allergy as a disability, a "disability" in this context is, as we discussed above, a technical term with a very specific meaning. Also, [Plaintiff] makes much of the fact that [the HR Director], and others, tried, unsuccessfully, to accommodate her allergy, which she argues shows he thought she was disabled. But simply because an employer tries to make an employee's working-environment more comfortable by attempting to accommodate a particular physical characteristic does not mean that he thinks the employee has a "disability." As the statute makes clear, not every physical or mental impairment qualifies as a "disability." From the evidence, it appears that [the HR Director] considered [Plaintiff] to have an allergy, and he did all he thought reasonable to accommodate the allergy. No evidence suggests that [the HR Director] treated the allergy as severely limited her ability to work. [Plaintiff's] naked assertions about [the HR Director's] thoughts and motivations are not sufficient; she "'must do more than simply show that there is some metaphysical doubt as to the material facts.'"

The Court does not explain how the School's placement of the plaintiff on a one-year unpaid medical leave was merely a reaction to a non-disabling allergy or how such action by the School was insufficient evidence that it perceived her as substantially limited by her allergy. It also does not explain why there was not enough of a factual dispute for a jury to consider. Perhaps the plaintiff never made the argument in her brief. In any event, the court granted summary judgment for the employer.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

Sixth Circuit: Job Applicants Did Not Knowingly Waive Limitations Period or Judicial Review of Claims

This morning, the Sixth Circuit issued an opinion reversing summary judgment in favor of an employer which had required all job applicants to agree to a six month statute of limitations for all employment claims and to waive their right to file a lawsuit (in favor of non-union labor-management internal grievance review board). Alonso v. Huron Valley Ambulance, Inc., No. 09-1812 (6^th Cir. 2010). The Court determined that the plaintiffs' signatures on the forms were not knowing and voluntary sufficient to waive their statutory rights under the circumstances of the case. Surprisingly, the Court did not address the substantive or procedural safeguards which existed or were lacking in the employer's dispute resolution process. Instead, it focused almost exclusively on how the information was haphazardly presented to the plaintiff employees during the application process. In particular, the plaintiffs were not given enough detail about the process until more than a month after they were hired (and had signed the agreements) and were never given the opportunity to revoke the agreements.

According to the Court's opinion, all employees were required to sign job applications which contained the following provisions:

The last page of the application contained a section preceded by the phrase, "PLEASE READ THE FOLLOWING BEFORE SIGNING." The section contained, among other things, notice of an internal grievance procedure for employment related disputes, and a six-month limitations period for any employment-related claims. The internal grievance procedure provision provided:

Any dispute arising out of or in connection with any aspect of my employment by the Company, or termination thereof, including by way of example but not limitation, disputes concerning alleged civil rights violations, breach of contract or tort, shall be exclusively subject to review by the Grievance Review Board. Any decision of the Review Board shall be binding to both parties, and enforceable in circuit court.

Additionally, the statute of limitations provision provided:

I further recognize that if employed by the Company, I agree, in partial consideration for my employment, that I shall not commence any action or other legal proceeding relating to my employment or termination thereof more than six months after the termination of my employment and agree to waive any statute of limitations to the contrary.

Once employees were hired, they were given a procedural manual during orientation. The manual describes the four-step grievance process and directs them to an internal policy, which, among other things, provides that "The Grievance Review Board's decision will be final and binding on both the employee and the company."

One of the plaintiffs was ultimately terminated for allegedly falsifying military leave and taking (prescription) drugs which put him in an altered mental state. He utilized the grievance process and then after his termination was upheld, he filed a lawsuit under USERRA, OSHA's whistleblower statute and an unnamed federal statute prohibiting retaliation for filing EEOC Charges. His wife (and co-worker) did not utilize the grievance procedure, but filed a similar lawsuit alleging harassment, and retaliation.

Although the plaintiffs challenged the employer's dispute resolution process on a number of grounds (including USERRA's absence of limitations period and waiver provisions), the Court only addressed whether the plaintiffs' waiver was knowing and intelligent:

Here, Appellants were educated and gave no indication that they did not understand the waivers they were signing, and they successfully used the grievance process on multiple occasions prior to contending that they did not knowingly and intelligently waive their right to a judicial forum. The waiver, however, did not include any information regarding the Grievance Review Board or the procedures that would be used in place of a judicial proceeding. The initial waiver, signed as part of the four-page employment application, read:

Any dispute arising out of or in connection with any aspect of my employment by the Company, or termination thereof, including by way of example but not limitation, disputes concerning alleged civil rights violations, breach of contract or tort, shall be exclusively subject to review by the Grievance Review Board. Any decision of theReview Board shall be binding to both parties, and enforceable in the circuit court.

Plaintiffs alleged "that they were not given any further information regarding the Grievance Review Board until they received an Employee Handbook at Orientation, nearly a month after they were hired. The Employee Handbook outlined the Grievance Review Board procedures in general terms as a four-step process. The Handbook instructed employees to reference Administrative Policy #415, which was located online. That Policy, in turn, provided a detailed explanation of how the Grievance Review Board operated."

At the time the [plaintiffs] signed waivers of their rights to a judicial forum, they had no idea what the Grievance Review Board process entailed. They were never informed of their right to revoke their waiver. They were not given any documentation regarding the process until almost a month after they began their employment with HVA. Even then, the document they were given described the process in general terms, and pointed them to a website where they could find additional, more detailed information. They cannot be said to have knowingly and voluntarily waived their right to a judicial forum when they were not informed of the alternative procedures until a month after they began working for HVA. Cf. Seawright, 507 F.3d at 971 (explaining extensive efforts taken by defendant employer to inform employees of new dispute resolution procedures before requiring employees to waive all rights to a judicial forum).

The court rejected the provisions shortening the statute of limitations on the same grounds.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

Ohio Courts: When Commuting to and From Work Arises Out of Employment

There have been a number of decisions over the last month which addressed whether an employer was liable for injuries to or caused by an employee while the employee was arguably off duty and even off the employer's premises. Therefore, it seemed to be a good time to review when an employer can find itself in legal trouble because of an employee who was not even at work at the time of the incident.

In the first case, a municipal housing inspector slipped and fell on the ice in a restaurant parking lot while he was walking back to his car following his daily, paid rest/coffee break to complete his trip from his office to a home which he had planned to inspect. Miller v. Administrator, Bureau of Workers' Compensation, 2010-Ohio-1347. The trial court granted summary judgment to the employer on the grounds that the coming-and-going rule precluded coverage for an employee with a fixed site of employment who was coming or going from work. The employee argued that he was still on duty at the time of the accident – albeit on a paid coffee break. The Court of Appeals agreed that while the coming-and-going rule might bar coverage for a similar accident during an unpaid lunch break, it might not bar coverage for paid rest breaks:

However, the same is not true of coffee breaks and other breaks taken for the employee's personal comfort, even when the employee is injured while off of the employer's work premises. . . . Unlike the unpaid lunch break, it is generally accepted that although an employee is not technically performing his work duties during a break, taking a break for personal comfort is deemed to be incidental to the employment and therefore in the course of and arising out of the employment. . . . Thus, in examining whether an off-premises break arises out of and in the course of the employment, the issue cannot be resolved solely through the mere determination of the fixed status of the employment and automatic application of the coming and going rule. The court must inquire into the specific circumstances of the injury to determine work-connectedness. Such factors could include the time of the break, whether the break is a right fixed by the employment contract, whether it is a paid break, whether there are any restrictions as to where the employee can take the break, and whether the employee's activity during the break constituted a
substantial personal deviation.

In addition, the court found that the injury occurred in the course of his employment because he "was required to leave his office building in order to satisfy the duties of his employment. Further, consistent with his employment contract, he was entitled to take a fifteen-minute coffee break at a time and location of his choosing. [He] then sustained an injury at a time when he was engaged in the permissible activities of employment. The risk of his injury was a risk inherently related to the nature of his employment and he would not have sustained the injury had he not been required to leave the office in order to satisfy his work duties." Further, the court found that the accident took place in proximity to his regular place of employment because: he "was at a place he could reasonably be expected to be at the time of injury in light of his employment duties and given that he had not deviated from his employment to engage in some activity of a purely personal nature. In addition, he was at a location that was reasonable in light of the location of the inspection site." The court also found that the employer had some degree of control over the employee because it "had control over the time and place where [he] could take his break and elected not to place any restriction upon [him]." Finally, in a mind-twisting move, the court found that the employer benefitted from the employee's rest break in that the employee would then feel renewed and re-energized to continue working.

Therefore, the court of appeals reversed the employer's summary judgment and directed entry of judgment in favor of the employee.

In the second case, Sammetinger v. Bureau of Workers' Compensation, 2010-Ohio-1500, a construction manager was injured in a single car accident when driving home after his regular shift when his son (a fellow employee) fell asleep while driving the company truck issued to the father/manager. The manager commuted to the Powell worksite from his home in Wapakoneta each day in a truck assigned to him by his employer. However, as a manager, his duties were not limited to the construction shift. He often stayed after work to conduct inventory and frequently ran errands in the company issued truck during and after the construction shift. These errands included picking up gasoline and ice for the crew during his commute and taking home company tools to be stored safely in his garage each night. He also frequently fielded cell phone calls while he was commuting to and from work. On the evening of the accident, he was too tired to drive home and asked his son – a fellow employee – to drive instead. Apparently, the son was sleepy as well, fell asleep during the drive and the father/manager was severely injured.

The father/manager brought, among other things, a claim for workers compensation benefits against his employer and sued the employer's insurance company under the UM/UIM portion of the employer's insurance policy (since their son had been driving a company-owned vehicle). The employer denied that the father/manager had been injured in the course of his employment and, thus, would not be covered by workers compensation. The son argued that he was immune from suit as a fellow employee under the workers' compensation statute. The trial court found that the father/manager's injuries were covered by workers' compensation because he was injured in the scope of his employment, and granted summary judgment to the son on the UM/UIM claim because he was a fellow employee.

To be covered by workers' compensation, the injury must occur in the course of and arise out of the employee's employment.

The phrase "in the course of employment" limits compensable injuries to those sustained by an employee while performing a required duty in the employer's service. "To be entitled to workmen's compensation, a workman need not necessarily be injured in the actual performance of work for his employer." An injury is compensable if it is sustained by an employee while that employee engages in activity that is consistent with the contract for hire and logically related to the employer's business. . . . .

Generally, "an employee with a fixed place of employment, who is injured while traveling to and from the place of employment, is not entitled to compensation under the Workers' Compensation Fund because the requisite causal connection between injury and the employment does not exist." MTD Products, Inc. v. Robatin (1991), 61 Ohio.St.3d 66, 68, 572 N.E.2d 661, citing Bralley, supra. However, there are exceptions to the general rule barring compensation when the injury occurs while the employee is "coming and going" to and from his place of employment: if the injury occurs in the "zone of employment;" if it was a result of a "special hazard" of the employment; or if, based upon the totality of the circumstances, there is a sufficient causal connection between the injury and the employment to warrant compensation. Moreover, the Ohio Supreme Court has long recognized that exceptions exist to the requirement that the injury must be suffered at or near the place of employment or within the zone of employment:

(1) where the employer, as an incident of the employment, provides the means of transportation to and from the place of employment; * * * and (3) where the employee is charged while on his way to or from his place of employment or at his home with some duty in connection with his employment.

In this case, the parties agreed that the father/manager had a fixed site of employment. Nonetheless, the court found that "he was acting for the benefit of his employer when he was injured and thus entitled to workers' compensation given the totality of the circumstances surrounding his injuries." The Court was particularly influenced by the amount of post-shift activities and the fact the employer had never prohibited post-shift work:

[The father/manager] closed down the masonry work on the high school and loaded up the pick-up truck that was assigned to him by [the employer] with tools and equipment belonging to [the employer] for transport to and safe-keeping in [the father/manager]'s garage at home. Every day on his way home, he stopped for gas, which was needed to operate a number of tools for the construction . . . the following day. He also stopped to purchase ice for the following day because fresh ice was required by contract to be provided by [the employer] to the workers at the site every day. [The father/manager] also refueled his work truck every other day because the truck was needed to provide him with transportation to and from the site, to provide ransportation for other workers who may have needed a ride, and to deliver [the father/manager]'s paperwork to [his boss] in Lima once a week. The truck was also assigned to [the father/manager] for use on errands such as picking up equipment from other [the employer]' job sites to be used at the high school or to make a run to a local hardware store during the day, and to transport the water containers and ice to and from the job site every day. The ice and gas purchases, which always occurred either in Russells Point or Wapakoneta, were made with a credit card provided by [the employer]

{¶31} Once he was home, [the father/manager] parked the truck in his garage in order to protect the tools and equipment in the truck from theft because a fair amount of tools had been stolen from the job site. In addition, [the father/manager] occasionally performed small repairs and maintenance on some of these tools and pieces of equipment at his home. He also cleaned the water containers and re-filled them at his home because the contract required [the employer] to supply fresh water to the workers every day. Often times, he had a significant amount of paperwork with him to complete because he was unable to finish it during the day because his attention was needed in some other function of his job. Therefore, he would complete this paperwork at home.

{¶32} Throughout the day, beginning at approximately 5:00 a.m. and continuing until approximately 10:00 p.m., [the father/manager] received phone calls on his employer-provided cellular phone. As previously noted, these calls were for a variety of work-related issues. Often times these calls occurred in the morning while [the father/manager] was going to the job site or during the afternoon while he was coming home from the job site. He also received work-related calls at his home.

{¶33} Indisputably, with the exception of an occasional call from his wife, all of these actions by [the father/manager] were directly for the benefit of his employer . . . While the location where [the father/manager] bought the ice and gas was of his own choosing, stopping to purchase these items, bringing home the containers to clean them and fill them with fresh water, transporting the tools and equipment for safekeeping, completing his paperwork for timely delivery to [his boss] every week, and receiving and making phone calls whenever and wherever, were all performed solely for [the employer]' benefit and in an effort to further its best interests. In fact, [the father/manager] summarized it best in his deposition: "My scope of employment doesn't end at 3:30 and doesn't start at 7 o'clock. There are responsibilities that go with my position that I can't control that need to be done, and I'm good at what I do, therefore I do it." Once again, [the employer] presented no evidence to contradict this statement by
[the father/manager] or any of the foregoing evidence regarding the work-related use of the company truck by [the father/manager].

{¶34} [The employer] also presented no evidence to demonstrate that [the father/manager]'s off-site activities were prohibited by it or that [the father/manager] was ever instructed to complete his tasks in a different manner. Although the credit card receipts would have shown that the gasoline and ice were being purchased at a location over fifty miles away from the job site, as well as the undoubtedly high amount of gasoline that was being purchased to drive the truck from Wapakoneta to the high school and back every day, the record is devoid of any evidence that [the employer] told [the father/manager] to purchase these items closer to the job site and not to use its truck and gasoline for daily transportation to and from his home. To the contrary, [the employer], at a minimum, acquiesced to [the father/manager] making these purchases far from the job site and to using the truck for his daily commute.

{¶35} Further, there is no evidence that [the father/manager] was ever instructed not to deliver his paperwork to [his boss's] home, not to complete it at his home, not to work on, transport, or house any of the equipment at his home, or not to make and receive work-related calls after he left the job site. Rather, the evidence indicates that [the father/manager]'s position as a supervisor required him to shoulder a number of responsibilities, to act in the best interest of [the employer]' business, and to do what was necessary to effectively fulfill his role as supervisor, whether he was at the job site, off the job site, or en route to accomplish one of his many required tasks. Moreover, [the employer] provided him with a vehicle, which he never used for personal business, and a phone to aid him in his duties. In sum, the evidence demonstrates that in many ways, the truck, which was under [the employer]' control, was [the father/manager]'s mobile work place.

{¶36} Furthermore, at the time of the accident, [the father/manager] had not completed his work for the day. The accident occurred at a point located between the [construction site] and Russells Point. Russells Point was one of two locations where [the father/manager] always stopped for gas and ice, the other being in Wapakoneta, which [the father/manager] had yet to reach. Thus, [the father/manager] was still en route to purchase the gasoline and ice for the following day when the accident occurred. He also had yet to clean and fill the water containers for the following day. As was customary for him, he was also transporting a number of tools from the high school to his home for safe-keeping at the time he was injured. In addition, shortly before the accident, [the father/manager] received a work-related call on his cellular phone.

{¶37} In short, [the employer] provided the vehicle in which [the father/manager] was injured as an incident to his employment; at a minimum, [the employer] acquiesced to the performance of some of his job duties being conducted on his way to and from work and at his home; it benefitted from the use of his garage to safely keep the vehicle and a
number of its tools and equipment overnight; and [the employer] required [the father/manager] to handle phone calls related to its business whenever they might occur, including on his drive to and from the job site and at his home. While [the employer] may not have directly paid [the father/manager] for each minute he spent doing its business while en route to and from work and at home, as [the father/manager] admitted he never charged his employer for the time he spent after the job site closed for the day on any phone calls, getting gas and ice, cleaning and filling the water containers, or maintaining and repairing the equipment he transported, this fact is of little consequence in light of the benefit [the employer] undoubtedly received from him.

{¶38} Thus, given the broad spectrum of responsibilities that [the father/manager] had as a masonry supervisor for [the employer], as well as the undisputed fact that these responsibilities necessitated him performing some of them away from the high school, including while en route to and at his home, the only reasonable conclusion in examining the totality of the facts and circumstances surrounding [the father/manager]'s injuries is that they occurred in the course of and arising out of his employment for [the employer].

Therefore, the Court of Appeals affirmed summary judgment against the employer on the workers' compensation claim.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.

Deadline for Federal COBRA Subsidy Again Extended

Last week, Congress passed the Continuing Extension Act of 2010, which among other things, extends unemployment benefits through June 2, 2010 and again extends the federal COBRA subsidy until May 31, 2010. However, the length of time (15 months) for which an individual may receive the COBRA subsidy has not been extended. In addition, the CEA maintains the new provision from the Temporary Extension Act of 2010 which provides that individuals who experience a COBRA qualifying event of a reduction in working hours (which renders them ineligible for medical insurance even though they remain employed part-time) before March 1, 2010, but are laid off after March 1, 2010 are eligible for the COBRA subsidy. The Department of Labor has not yet amended the COBRA notifications which employers must send to eligible employees (and its website still refers to the March 31 date).

The Ohio Department of Insurance reports that on February 25, 2010, Govenor Strickland also signed a bill to authorize the temporary extension of the period of time which the laid-off employees of small employers (i.e., with less than 20 employees who are not subject to the federal COBRA statute) from 12 months to 15 months for as long as a federal COBRA subsidy is available. The ODOI website also still mentions the March 31, 2010 deadline from the TEA and has not yet addressed the affect, if any, of the CEA.

More information about the COBRA subsidy and the notices employers are required to send is available at Employers Must Send Amended COBRA Notices and DOL Publishes Model Notices for COBRA Subsidy Under Stimulus Act to Be Sent by Employers Before April 18.

NOTICE: This summary is designed merely to inform and alert you of recent legal developments. It does not constitute legal advice and does not apply to any particular situation because different facts could lead to different results. Information here can change or be amended without notice. Readers should not act upon this information without legal advice. If you have any questions about anything you have read, you should consult with or retain an employment attorney.