Posts tagged with "mediation"

What Parents Need to Know About Special Education Law

The state and federal governments enacted various regulations to protect a student with disabilities and to ensure that he or she obtains a Free Appropriate Public Education (FAPE).  Parents play a key role in the success of any special education program implemented for their children. Given the complexity of special education law, it is important to understand the significant responsibility a parent has in the special education system.

Referral to Special Education and Related Services

This is the first step in the process to determine a child’s eligibility for special education and related services. Parents should be aware that you have the right to request such a referral.  The referral must be in writing.  School officials also have the ability to make a referral.  However, a parent is often in a better position to suspect any disabilities, and can make an early referral to special education services through Connecticut’s Birth to Three program, prior to enrollment in school.

Planning and Placement Team (PPT)

The PPT reviews all referrals to special education. As a parent of a child, you have the right to be actively involved in the PPT, and are, in fact, a valued asset of the PPT.   A PPT generally consists of the parent(s), one of the child’s educators, a special education teacher, a representative of the school district, a pupil services personnel, and the child (depending on age).   As a parent, you have the right to include other individuals who have knowledge or special expertise regarding your child.  As a valued member of the PPT, the school district must try to schedule meetings at a mutually agreeable time and place for you and must notify you, in writing, at least five (5) school days prior to holding the meeting.

Evaluations, Independent Educational Evaluations (IEE), and Reevaluations

The evaluation is the study used to determine a child’s specific learning strengths and needs, and ultimately determine whether your child is eligible for special education services. As an active participant, a parent can assist the PPT in designing the evaluation.  That is why sharing with the PPT all important information concerning your child’s skills, abilities, observations, and needs can be extremely beneficial to the process.  If you disagree with the evaluation conducted by the school district, you have a right to obtain an independent educational evaluation (IEE).  Such an IEE can be obtained at the school district’s expense, unless the school district can prove its evaluation is appropriate or that the IEE does not meet the school district’s criteria. If the school district believes that its evaluation was appropriate, it must initiate a due process hearing (or pay for the IEE).  In either event, you have a right to an IEE. However, if the school district’s evaluation is found appropriate, the parent will have to bear the cost of the IEE.  Reevaluation must be performed at least once every three (3) years, or sooner if conditions warrant. At the reevaluation, the educational needs of your child will be assessed, along with present levels of academic and related development needs of your child to determine whether your child continues to need special education and related services and whether your child’s IEP needs to be modified.

Individualized Education Program (IEP)

The IEP is a written plan that describes in detail your child’s special education program created by the PPT. Given the IEP is designed specifically for your child, it is vital that as a parent you exercise your right to be actively involved in the PPT meetings.  The IEP is designed to identify your child’s current levels of education and functional performance and any modifications or accommodations your child needs to participate in the general education curriculum. A child with a disability must, to the maximum extent possible, be educated with his/her nondisabled peers.  This is called the Least Restrictive Environment (LRE). By law, you are entitled to receive a copy of your child’s IEP within five (5) school days after the PPT meeting was held to develop or revise the same.

Informed Consent

Prior to evaluating a child for the first time, a school district must obtain the parent’s written informed consent.  Informed consent means that a parent has been given all the information needed to make a knowledgeable decision. Written informed consent must also be obtained prior to the initial placement into special education, before a child is placed into private placement, and before a child is reevaluated.  As a parent, you can refuse to give your consent and you can withdraw consent once it has been given.  Giving consent for an initial evaluation does not mean that consent was given to place a child into special education or for any other purposes.  A school district must obtain separate written informed consent for each.

Placement

To the maximum extent possible, your child must be educated with his/her nondisabled peers in a general education classroom.  Removal from the school that your child would attend had he/she not had a disability, should only occur when the nature or the severity of the disability is such that educating your child in that setting cannot be achieved satisfactorily.  If this is the case with your child, the PPT must find an appropriate educational placement as close as possible to your home, at the cost of the school district.  While you can place your child in private placement on your own, there is no guarantee of full or partial reimbursement from the school district and that will ultimately depend on the findings by a hearing officer.

Disciplinary Procedures

The school district’s code of conduct applies to all children, with or without a disability. Prior to any suspension or removal, your child has the right to an informal hearing conducted by a school administrator. If it is determined by the PPT that the behavior was caused or related to your child’s disability, then your child may not be removed from the current education placement (except in the case of weapons, drugs, or infliction of serious bodily harm).  It is the PPT’s obligation to conduct a functional behavioral assessment and implement a behavioral intervention plan.

Access to Records

If your child has not reached the age of majority, as a parent you have a right to inspect and review his/her school records. The request must be in writing. The school district must allow you to review the records within ten (10) school days from your request or within three (3) school days if you need the information for a PPT meeting.  Connecticut law provides that you are entitled one free copy of your child’s records, and the school district has up to five (5) school days to provide you with that copy.

Due Process

A parent has the right to ask for a due process hearing as a result of the school district’s refusal to consider or find that your child has a disability, to evaluate your child, to place your child in a school program that meets his/her needs, or to provide your child with a FAPE.   A parent may bring an advocate or attorney with them to aid throughout the hearing.  A hearing officer will make a final decision within 45 days from the start of the timeline.  Generally, while a due process hearing is pending, a child’s classification, program or placement cannot be changed.

Alternative Dispute Resolution

There are three ways, other than a full due process hearing, to settle disputes between parents and the school district. The first is the Complaint Resolution Process, wherein a parent files a written complaint with the Bureau of Special Education, alleging the local school district has violated a state or federal requirement.  Within sixty (60) days, a written report which includes the Bureau’s findings, conclusions, corrective actions and recommendations, will be mailed to the Complainant.  The second alternative is mediation. Both parties (the parents and the school district) must agree to mediate the dispute.  At mediation, if an agreement is reached, it is placed in writing and is legally binding.  All discussions during mediation are confidential.  The last alternative is an advisory opinion. This is a non-binding opinion, issued by a hearing officer, after a brief presentation of information by both parties.  After receiving the advisory opinion, the parties can decide to settle the dispute or proceed to a full due process hearing.

By: Leigh H. Ryan, Esq.

If you have any questions regarding special education law, or any education law matter, contact Joseph Maya at 203-221-3100 or by email at JMaya@MayaLaw.com.

 

What is the enforceability of an employment contract in Connecticut?

In Connecticut, the enforceability of an employment contract is based on general contract principals. This contract can be verbal, written or a combination of the two. In addition, employment contracts in Connecticut can be either express or implied. An employment contract is an express contract if it is written and signed by both parties. A valid express employment contract will contain wording that describes the job duties, working conditions, compensation, benefits and other employment details.

If, alternatively, an employment contract is implied, the terms of the contract would come from the conduct of the parties, verbal promises made before employment started, information stated in an employee handbook, promises made in an offer letter, and other sources.

Today, most employers have their employees sign a document agreeing to at-will employment as opposed to a defined term in an employment contract. This way, either the employer or the employee may end the employment relationship at any time, and usually for any reason.

In any case, Connecticut courts regularly find employment contracts enforceable against both parties. Such agreements will be upheld by Connecticut courts as long they do not violate any laws and were not entered fraudulently, under duress, or by mistake of the parties. If valid, both parties to the contract will be held responsible for abiding by its terms and liable for any breach. Frequently, allegations of breach of an employment contract involve issues of compensation and termination of employment.

If you are interested in drafting an enforceable employment contract, or interested in determining whether an employment contract you have already signed is binding, please feel free to call the Employment Law Group of Maya Murphy, P.C. in Westport, CT at 203-221-3100 or email Ask@mayalaw.com today.

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Termination Does Not Invalidate a Non-Compete Agreement

Termination Does Not Invalidate a Non-Compete Agreement

Built In America, Inc. v. Morris, 2001 Conn. Super. LEXIS 2953

Mr. Michael Morris was the owner of Built In America, Inc. until he sold his entire stock in the company to Mr. Marc Costa in October 2000. The parties executed a Purchase and Sale Agreement that legally transferred the stock and ownership of the company. The transaction included an employment contract for an initial period of two years and a non-compete clause that became effective upon Mr. Morris’s termination from the company. The company terminated Mr. Morris in April 2001 and he proceeded to work in direct competition with his former employer. Mr. Costa and Built In America sued Mr. Morris for violation of the non-compete agreement and asked the court to enforce the agreement’s provisions. Mr. Morris argued that the restrictive covenant was null and void because the company had breached the employment agreement when it unlawfully terminated his employment.
The court found in favor of Built In America, ordered the enforcement of the covenant not to compete, and issued an injunction. There was no dispute over the reasonableness of the covenant, only a dispute over whether it became void when the company allegedly improperly terminated Mr. Morris. Built In America cited previous Connecticut cases, most notably Robert S. Weiss & Associates, Inc. v. Wiederlight (208 Conn. 525 (1988)), where the court held that termination did not invalidate a non-compete agreement. Furthermore, the court concluded that the company was justified with respect to its decision to terminate Mr. Morris’s employment, stating that his “behavior was so outrageous that one is left to believe he was inviting his discharge”. The court ultimately concluded that the covenant was legally binding and ordered its enforcement.
If you have any questions relating to your non-compete agreement or would like to discuss any element of your employment agreement, please contact Joseph C. Maya, Esq. by phone at (203) 221-3100 or via e-mail at JMaya@Mayalaw.com.

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Non-Compete Invalidated Due to Unnecessary Restrictions on Future Employment

Non-Compete Invalidated Due to Unnecessary Restrictions on Future Employment
Connecticut Bathworks Corp. v. Palmer, 2003 Conn. Super. LEXIS 2193

Connecticut Bathworks Corporation was a company servicing New Haven, Fairfield, and Litchfield counties that remodeled bathrooms via the installation of prefabricated acrylic bathtub liners and wall systems. The company employed Mr. Palmer from approximately the beginning of April 2001 to February 28, 2003 at which point Mr. Palmer voluntarily terminated his employment. He began to work for Re-Bath of Connecticut, a company in direct competition with Bathworks, the next day. The issue in this case is that Mr. Palmer signed a “Company Confidentiality Agreement” when he began to work for Bathworks that contained a covenant not to compete that prohibited him from “being employed by any business in competition with the plaintiff [Bathworks] within any county in which the plaintiff is doing business for a period of three years from the termination of his employment with the plaintiff”. This created a three-year prohibition on working for a competitor with the tri-county area of New Haven, Fairfield, and Litchfield.
Bathworks sued Mr. Palmer in Connecticut state court and requested an injunction to enjoin him from further violations of the non-compete agreement. The court analyzed the facts of the case, held in favor of Mr. Palmer, and denied Bathworks’s request for injunctive relief. The court’s decision ultimately came down to the issue of whether Mr. Palmer’s employment with Re-Bath would negatively affect Bathworks’s interests and business operations. Bathworks carried the burden of establishing the probability of success on the merits of the case and the court held that it failed to present sufficient evidence to indicate it would be directly and immediately harmed due to breach of the restrictive covenant.
Bathworks argued that Mr. Palmer acquired valuable trade secrets and information during his employment with the company and that his continued employment with Re-Bath would harm its operations. The court however found that Mr. Palmer, as an installer, did not have access to Bathworks’s confidential information or any trade secrets that would put the company at a competitive disadvantage. The court further noted that while Mr. Palmer was a skilled laborer, he was not a high-level executive, nor did he provide “special, extraordinary, or unique” services. Bathworks also failed to present any evidence to show that Mr. Palmer knew of or took part in the company’s sales/marketing activities or the development of a business strategy.
The court stated that its role in deciding the case was to balance the parties’ interest to fairly protect Bathworks’s business while not unreasonably restricting Mr. Palmer’s right to seek employment elsewhere. This agreement however, according to court, unnecessarily restricted Mr. Palmer’s right to work at another company because there was nothing about that employment which would disadvantage Bathworks in the industry. The non-compete agreement went beyond what was reasonably necessary to protect the company’s interests and as such, the court denied Bathworks’s request for an injunction.
If you have any questions relating to your non-compete agreement or would like to discuss any element of your employment agreement, please contact Joseph C. Maya, Esq. by phone at (203) 221-3100 or via e-mail at JMaya@Mayalaw.com.

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What’s In a Separation Agreement?

With the economy where it is, the employment lawyers in the Westport, Connecticut office of Maya Murphy, P.C. are frequently asked to review and negotiate separation agreements for terminated employees.  These agreements often appear similar in form and content but must be carefully scrutinized, as they can contain hidden “trip wires” that can have a profound and long-lasting effect on the former employee’s job prospects.  Here are some of the things to look out for.

Most separation agreements contain restrictive covenants—confidentiality, non-solicitation, or non-competition clauses.  The first two—confidentiality and non-solicitation—are typically non-controversial, as they often confirm pre-existing obligations owed an employer by a former employee.  The last—non-competition—is usually a point of contention, as it impacts directly the employee’s ability to find a new position.  We have blogged extensively on non-competes, their interpretation and enforceability, etc. and readers are invited to review those prior posts.  But other terms and conditions of a separation agreement deserve your attention, as well.

First of all, do not be surprised by the length of a separation agreement.  A federal statute called the Older Worker’s Benefit and Protection Act requires the inclusion of extensive release language, and such things as a 21 day review and seven day revocation period.  Here are some of the other things you should be on the lookout for:

  • Consideration:  Make sure all of the severance benefits are correct and clearly stated.  This includes severance pay, COBRA coverage, etc.  Do not leave anything to inference or implication.
  • Confirmation that No Claims Exist/Covenant Not to Sue: Notwithstanding the comprehensive release language, some separation agreements will also require the employee to state that he/she is not aware of any factual basis to support any charge or complaint and that the employee will forego suit, even if such a claim exists.
  • Non-disparagement: Both sides often agree that neither will say anything to disparage the other.  Sometimes (particularly in the financial industry), a separation agreement will contain a “carve out” for employer reporting to FINRA or the SEC.  In such a case, it is important to have the agreement state that as of the employee’s separation date, the employer was not aware of any reportable event or information that would warrant comment or notation on a Form U-5.
  • Governing Law:  Employment law does not travel well across state lines.  For example, California law is much different than Connecticut’s.  Large companies will sometimes have their separation agreements governed by the law of the state where it has its headquarters, irrespective of the actual place of work of the departing employee.
  • Acknowledgement of Non-Revocation: An employee has seven days within which to revoke acceptance of a separation agreement.  Some companies adopt a “belt and suspenders” approach and require the employee to acknowledge in writing a negative—that they have not revoked such acceptance.

The employment law attorneys in the Westport, Connecticut office of Maya Murphy, P.C. have extensive experience in the negotiation and litigation of all sorts of employment-related disputes and assist clients from Greenwich, Stamford, New Canaan, Darien, Norwalk, Westport and Fairfield in resolving such issues.  203-221-3100.

 

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Non-Compete Enforceability: Must Protect Legitimate Interest & Not Be Punitive

Non-Compete Enforceability: Must Protect Legitimate & Not Be Punitive
Ranciato v. Nolan, 2002 Conn. Super. LEXIS 489

Historic Restoration and Appraisal, LLC (HRA) was engaged in the business of restoring primarily detached single-family homes that had suffered casualty damage from fire and/or water. The company employed Mr. Timothy Nolan to work as a project manager for jobs located throughout the state of Connecticut. Mr. Nolan’s employment began on November 18, 1996 and the company informed him shortly thereafter that his employment was contingent on the execution of a non-compete agreement. The parties signed the restrictive covenant on November 21, 1996 and it prohibited Mr. Nolan from performing the same services offered by HRA in the states of Connecticut, Massachusetts, and Rhode Island for a period of three years. The agreement did not affect Mr. Nolan’s ability to offer painting or home improvement services that were not in connection to fire and/or water damage. In exchange for this employment restriction, the agreement stipulated that Mr. Nolan’s annual salary would be $48,500. He felt that he would be fired if he failed to sign the agreement and signed it without consulting a legal professional.
HRA fired Mr. Nolan on January 24, 1997 after repeated incidents of discovering that he was receiving lewd and inappropriate materials via the company’s fax machine. He began to work for McGuire Associates shortly after HRA discharged him and performed marketing and business development services in the capacity of his new position. Unlike HRA, McGuire is a preferred builder and the court held that it did not compete with HRA. The company sued Mr. Nolan in Connecticut state court and asked the court to enforce the non-compete agreement that the parties had executed. The Superior Court of Connecticut in New Haven rejected HRA’s request and held that the company “suffered no financial loss as a result of the defendant’s employment by McGuire”.
According to the non-compete agreement, Mr. Nolan can be in breach only if he works at a company that is “in competition with” HRA. While the court acquiesced that HRA and McGuire were both in the construction industry, it held that they performed significantly different services and were not in competition with each other for clients or projects. The industry classified HRA as a “fire chaser” because it received most of its jobs by monitoring police reports and fire scanners to alert them of individuals that needed repairs for fire and/or water damage. McGuire however was a preferred builder and provided services for not only single-family homes, but also commercial and municipal buildings. The courts interpreted the significant differences between the two companies as adequate evidence that Mr. Nolan was not “in competition with” HRA because of his new employment with McGuire.
Furthermore, the court discussed the reasons why a court would enforce a non-compete covenant, specifically referencing the legal system’s desire to balance and protect the parties’ interests. Courts generally grant injunctions to enforce a non-compete agreement when the plaintiff employer can provide adequate evidence that the former employee’s breach will result in adverse financial consequences. The court noted that this policy did not apply to the case since HRA had not suffered any financial loss or hardship and Mr. Nolan did not have any access to confidential information that would be harmful to the company should it be disclosed.
Additionally, the court concluded that the time and geographical restrictions in the agreement were unreasonable given the facts of the case. HRA did not have anything to lose because of McGuire employing Mr. Nolan because of the differences in their business operations and the court held that the restrictions, if enforced, would only serve to prevent Mr. Nolan from employment at another company. The policy to enforce non-compete agreements focuses on protecting the interests of the employer and not to punish the employee and excessively restrict future employment opportunities. Specifically, the court cited that HRA could only “benefit from protection in the New Haven area” and that the “tri-state restriction imposed on the defendant was not necessary to protect any legitimate interests of the plaintiff and, therefore, [the agreement] was not ‘reasonably limited’”.
If you have any questions relating to your non-compete agreement or would like to discuss any element of your employment agreement, please contact Joseph C. Maya, Esq. by phone at (203) 221-3100 or via e-mail at JMaya@Mayalaw.com.

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Non-Compete Enforceability: Must Protect Legitimate Interest & Not Be Punitive

Non-Compete Enforceability: Must Protect Legitimate & Not Be Punitive
Ranciato v. Nolan, 2002 Conn. Super. LEXIS 489

Historic Restoration and Appraisal, LLC (HRA) was engaged in the business of restoring primarily detached single-family homes that had suffered casualty damage from fire and/or water. The company employed Mr. Timothy Nolan to work as a project manager for jobs located throughout the state of Connecticut. Mr. Nolan’s employment began on November 18, 1996 and the company informed him shortly thereafter that his employment was contingent on the execution of a non-compete agreement. The parties signed the restrictive covenant on November 21, 1996 and it prohibited Mr. Nolan from performing the same services offered by HRA in the states of Connecticut, Massachusetts, and Rhode Island for a period of three years. The agreement did not affect Mr. Nolan’s ability to offer painting or home improvement services that were not in connection to fire and/or water damage. In exchange for this employment restriction, the agreement stipulated that Mr. Nolan’s annual salary would be $48,500. He felt that he would be fired if he failed to sign the agreement and signed it without consulting a legal professional.
HRA fired Mr. Nolan on January 24, 1997 after repeated incidents of discovering that he was receiving lewd and inappropriate materials via the company’s fax machine. He began to work for McGuire Associates shortly after HRA discharged him and performed marketing and business development services in the capacity of his new position. Unlike HRA, McGuire is a preferred builder and the court held that it did not compete with HRA. The company sued Mr. Nolan in Connecticut state court and asked the court to enforce the non-compete agreement that the parties had executed. The Superior Court of Connecticut in New Haven rejected HRA’s request and held that the company “suffered no financial loss as a result of the defendant’s employment by McGuire”.
According to the non-compete agreement, Mr. Nolan can be in breach only if he works at a company that is “in competition with” HRA. While the court acquiesced that HRA and McGuire were both in the construction industry, it held that they performed significantly different services and were not in competition with each other for clients or projects. The industry classified HRA as a “fire chaser” because it received most of its jobs by monitoring police reports and fire scanners to alert them of individuals that needed repairs for fire and/or water damage. McGuire however was a preferred builder and provided services for not only single-family homes, but also commercial and municipal buildings. The courts interpreted the significant differences between the two companies as adequate evidence that Mr. Nolan was not “in competition with” HRA because of his new employment with McGuire.
Furthermore, the court discussed the reasons why a court would enforce a non-compete covenant, specifically referencing the legal system’s desire to balance and protect the parties’ interests. Courts generally grant injunctions to enforce a non-compete agreement when the plaintiff employer can provide adequate evidence that the former employee’s breach will result in adverse financial consequences. The court noted that this policy did not apply to the case since HRA had not suffered any financial loss or hardship and Mr. Nolan did not have any access to confidential information that would be harmful to the company should it be disclosed.
Additionally, the court concluded that the time and geographical restrictions in the agreement were unreasonable given the facts of the case. HRA did not have anything to lose because of McGuire employing Mr. Nolan because of the differences in their business operations and the court held that the restrictions, if enforced, would only serve to prevent Mr. Nolan from employment at another company. The policy to enforce non-compete agreements focuses on protecting the interests of the employer and not to punish the employee and excessively restrict future employment opportunities. Specifically, the court cited that HRA could only “benefit from protection in the New Haven area” and that the “tri-state restriction imposed on the defendant was not necessary to protect any legitimate interests of the plaintiff and, therefore, [the agreement] was not ‘reasonably limited’”.
If you have any questions relating to your non-compete agreement or would like to discuss any element of your employment agreement, please contact Joseph C. Maya, Esq. by phone at (203) 221-3100 or via e-mail at JMaya@Mayalaw.com.

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Should I Consider Mediating my Divorce in Connecticut?

Mediation is a less formal process than litigation where the parties select a neutral third party to help them forge compromises and, if successful, ultimately reach a final separation agreement that deals with the financial, custody and other issues involved in a divorce.  Unlike litigation, mediation is akin to a settlement negotiation and is both confidential and not binding on the parties.  The mediator does not represent either party in the mediation, does not provide them with legal advice, and does not decide issues.  Rather, the mediator provides the parties with information, and helps them to identify and address the relevant issues and to bridge their differences.  If the mediation is not successful, the parties may then litigate the action.  If the mediation is successful and parties reach a final separation agreement, that agreement will be binding, once the marriage is dissolved by a court.

If you have any questions related to divorce in Connecticut, please contact Joseph C. Maya, Esq. at (203) 221-3100 or e-mail him directly at JMaya@Mayalaw.com.

Should I Consider Mediating my Divorce in Connecticut?

Mediation is a less formal process than litigation where the parties select a neutral third party to help them forge compromises and, if successful, ultimately reach a final separation agreement that deals with the financial, custody and other issues involved in a divorce.  Unlike litigation, mediation is akin to a settlement negotiation and is both confidential and not binding on the parties.  The mediator does not represent either party in the mediation, does not provide them with legal advice, and does not decide issues.  Rather, the mediator provides the parties with information, and helps them to identify and address the relevant issues and to bridge their differences.  If the mediation is not successful, the parties may then litigate the action.  If the mediation is successful and parties reach a final separation agreement, that agreement will be binding, once the marriage is dissolved by a court.

If you have any questions related to divorce in Connecticut, please contact Joseph C. Maya, Esq. at (203) 221-3100 or e-mail him directly at JMaya@Mayalaw.com.

DOMA’s Unconstitutionality and How it Impacts Employee Benefit Plans Going Forward

The U.S. Supreme Court issued two landmark decisions on same-sex marriage Wednesday that will affect how employers administer their employee benefit plans and treat same-sex spouses. Below is a summary of the cases, their outcomes and how these two decisions impact plan sponsors of employee benefit plans.

The Cases

In U.S. v. Windsor, the Court struck down the federal law defining “marriage” as exclusively the union between a man and a woman and “spouse” as a person who is married to someone of the opposite sex. The Defense of Marriage Act (DOMA) prohibited the federal government from treating same-sex and opposite-sex married couples alike. It entitled only opposite-sex married couples to federal privileges incident to marriage, such as the ability to file joint federal tax returns.

In a 5-to-4 decision, the Court ruled DOMA was unconstitutional because states and territories are generally free to define “marriage” and the federal government must generally accept those definitions for purposes of administering benefits incident to marriage. Therefore, if a person in a same-sex marriage resides in a state or territory that permits or recognizes same-sex marriages, such as Connecticut, Massachusetts, New York and the District of Columbia, that person must now be deemed married for federal purposes. Currently, 12 states and the District of Columbia recognize same-sex marriage. However, if the person lives in a state or territory that does not authorize or recognize same-sex marriages, then federal law does not require that the person be considered married.

In a related decision, Hollingsworth v. Perry, the Court declined to rule on a dispute over the validity of a California state law that, like DOMA, defined marriage as exclusively between a man and a woman. This decision leaves in place a lower federal court’s ruling that California’s law was unconstitutional, and so, effectively, same-sex couples are once again permitted to marry in California.

What Does This Mean For Employee Benefit Plans?

These decisions will significantly impact how employers administer their employee benefit plans and how they treat same-sex spouses for benefit purposes. Summarized below are examples of how welfare and retirement benefit plans will be affected:

Welfare Benefit Plans

Same-sex spouses will be able to receive tax-free employer-paid health benefits, meaning employers will not have to impute income on the value of employer-provided health coverage to nondependent same-sex spouses or their children, nor will they be required to pay payroll taxes on the imputed income.
Same-sex spouses will be able to claim COBRA continuation healthcare coverage in the event they lose their employer-provided coverage due to a COBRA qualifying event.
Employees will be entitled to reimbursements under flexible spending accounts, health reimbursement accounts and health savings accounts (HSAs) for expenses incurred by their same-sex spouse.
Earned income from same-sex spouses will affect the exclusion amount under a dependent care assistance program.
A single-family contribution limit applicable to HSAs will apply to same-sex couples (same-sex couples were formerly entitled to twice the family limit).
The invalidation of DOMA may trigger a change-in-status event under the cafeteria plan rules.

Retirement Benefit Plans

Same-sex spouses will be entitled to survivor benefits, including those available under the qualified joint and survivor annuity and qualified preretirement survivor annuity rules applicable to pension plans.
Domestic relations orders involving same-sex spouses may entitle the former spouse to retirement benefits.
Expenses related to same-sex spouses may entitle plan participants to hardship withdrawals.
Same-sex widows/widowers will not be required to commence payment of their same-sex spouse’s retirement benefits until April 1 of the year following the year such same-sex spouse would have attained age 70½.

The Supreme Court’s rulings in these two cases leave open many issues. Specifically, the rulings do not answer the questions of whether the invalidation of DOMA is prospective (i.e., effective as of the date of the Supreme Court’s ruling) or retroactive (i.e., effective as of the date of DOMA’s enactment) and what employers are required to do to comply. We anticipate transition guidance from the Internal Revenue Service and expect employers will be given sufficient time to adequately address the required changes. In the meantime, we recommend employers immediately review their plan documents and administrative procedures to determine what plan amendments and adjustments to administrative procedures will be required. Day Pitney’s employee benefits attorneys can assist you in this process.
The lawyers at Maya Murphy, P.C., are experienced and knowledgeable employment and corporate law practitioners and assist clients in New York, Bridgeport, Darien, Fairfield, Greenwich, New Canaan, Norwalk, Stamford, Westport, and elsewhere in Fairfield County. If you have any questions relating to your non-compete agreement or would like to discuss any element of your employment agreement, place contact Joseph C. Maya, Esq. by phone at (203) 221-3100 or via e-mail at JMaya@Mayalaw.com.

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