My judgment against TempWorks Management, Inc. in a Minnesota court. It was an unfortunate, but necessary, process. The truth prevailed, as it usually does in these types of situations.
The document is an employment law newsletter from the law firm Tharpe & Howell. It summarizes three legal cases related to mandatory arbitration clauses, safety programs impact on workers' compensation premiums, and penalties for misclassifying employees. It provides contacts for the firm's labor lawyers to discuss these issues.
This newsletter from Judge & Priestley LLP provides updates on recent legal developments. It announces the appointment of Mark Bailey as Director of Collections for J&P Credit Solutions to strengthen its debt recovery services. It also summarizes several court cases, including an agent being awarded damages for breach of contract, a builder ordered to repay funds improperly obtained, and a director being disqualified for improperly transferring company assets.
Independent Contractors v. Employees-- How to Avoid MisclassificationDeirdreJ6972
Employers are fans of independent contractors, for some obvious reasons. The IRS and Department of Labor know this too. Don\'t get caught misclassifying your employees as contractors. Be smart and be wary.
When a Utility company attempts to strong arm you (if you lose your job, are disabled, a personal carer or anyone else on a low income and easily susceptible to economic hardship.)
Georgia law requires employers with three or more employees to obtain workers' compensation insurance or be self-insured. Covered employers must maintain a list of physicians for injured employees and post a notice of employees' rights. All employees are covered except for certain exempted categories like domestic servants. The Georgia State Board of Workers' Compensation administers the law and handles disputes. Employers may purchase insurance, self-insure if qualified, or join a self-insured group. The law covers workplace injuries, deaths, and occupational diseases but excludes some non-work related conditions.
The document discusses several legal factors that affect businesses in their operating environment. These include organizational law, securities law, contract law, consumer protection laws, employee protection laws, health and safety laws, laws regarding termination of employees, immigration laws, and government procurement laws. All of these legal factors play an important role in determining the success of businesses around the world by creating the structure for how businesses can operate and protecting important stakeholders such as consumers, employees, and investors.
The document provides tips and best practices for kitchen and bath companies to prevent litigation, including proper communication, avoiding shortcuts, thorough record keeping, complying with laws, and properly screening subcontractors. It also discusses common sources of liability such as misrepresentations, mistakes, lack of procedures, and failure to follow through. Examples of actual litigation issues involving kitchen companies are presented.
The document is an employment law newsletter from the law firm Tharpe & Howell. It summarizes three legal cases related to mandatory arbitration clauses, safety programs impact on workers' compensation premiums, and penalties for misclassifying employees. It provides contacts for the firm's labor lawyers to discuss these issues.
This newsletter from Judge & Priestley LLP provides updates on recent legal developments. It announces the appointment of Mark Bailey as Director of Collections for J&P Credit Solutions to strengthen its debt recovery services. It also summarizes several court cases, including an agent being awarded damages for breach of contract, a builder ordered to repay funds improperly obtained, and a director being disqualified for improperly transferring company assets.
Independent Contractors v. Employees-- How to Avoid MisclassificationDeirdreJ6972
Employers are fans of independent contractors, for some obvious reasons. The IRS and Department of Labor know this too. Don\'t get caught misclassifying your employees as contractors. Be smart and be wary.
When a Utility company attempts to strong arm you (if you lose your job, are disabled, a personal carer or anyone else on a low income and easily susceptible to economic hardship.)
Georgia law requires employers with three or more employees to obtain workers' compensation insurance or be self-insured. Covered employers must maintain a list of physicians for injured employees and post a notice of employees' rights. All employees are covered except for certain exempted categories like domestic servants. The Georgia State Board of Workers' Compensation administers the law and handles disputes. Employers may purchase insurance, self-insure if qualified, or join a self-insured group. The law covers workplace injuries, deaths, and occupational diseases but excludes some non-work related conditions.
The document discusses several legal factors that affect businesses in their operating environment. These include organizational law, securities law, contract law, consumer protection laws, employee protection laws, health and safety laws, laws regarding termination of employees, immigration laws, and government procurement laws. All of these legal factors play an important role in determining the success of businesses around the world by creating the structure for how businesses can operate and protecting important stakeholders such as consumers, employees, and investors.
The document provides tips and best practices for kitchen and bath companies to prevent litigation, including proper communication, avoiding shortcuts, thorough record keeping, complying with laws, and properly screening subcontractors. It also discusses common sources of liability such as misrepresentations, mistakes, lack of procedures, and failure to follow through. Examples of actual litigation issues involving kitchen companies are presented.
The document discusses how CPAs can help clients identify and mitigate employment liability risks. It identifies four key areas of risk: 1) payroll tax liability from misclassifying employees, 2) wage and hour issues from poor timekeeping and misclassifying exempt employees, 3) protecting trade secrets from current and former employees, and 4) discrimination claims from outdated policies and lack of training. For each risk area, it provides examples of problems clients may have and recommendations on how to reduce exposure, such as properly classifying workers, keeping accurate time records, implementing physical and digital security, and conducting regular anti-discrimination training.
White Paper: Complying With Regulations Regarding Temporary Workersss
The use of temporary workers is growing in the United States, now representing 22% of the total workforce. Temporary workers are referred to as freelancers, non-employees, indirect workers, agency contractors, consultants, interns, independent contractors, and many other terms.
Independent Contractors and Employees: Understanding the DifferenceDeirdre Kamber Todd
This document provides an overview of the differences between classifying workers as employees versus independent contractors. It discusses the various tests used by the IRS, US Department of Labor, US Supreme Court and Pennsylvania Department of Labor to determine status. The document notes that no single factor determines classification and that the tests examine the degree of control over the worker and the economic realities of the relationship. It also summarizes the potential consequences of misclassification and an IRS program for voluntarily reclassifying workers.
This document summarizes Utah Senate Bill 81, which requires public employers and contractors to use E-Verify or other status verification systems to check the work authorization of new hires. It discusses how the bill applies to employers, penalties for transporting undocumented immigrants, and increased cooperation with immigration enforcement. Nationally, it notes recent court decisions impacting state immigration laws and the new presidential administration's approach.
Law 531 final exam guide new
http://helpfinalexams.com/homework_text.php?cat=2633
1. What defense can an employer use to a charge of sexual harassment?
The harassed employee was not made aware of the company’s antiharassment policies.
The harassed employee took advantage of the preventive measures provided by the company but still could not avoid being harassed.
The employer does not have any complaint mechanisms for employees who are harassed.
The employer used reasonable care to prevent and correct the sexually harassing behavior.
2. Choose the correct statement about the Environmental Protection Agency (EPA).
It is exclusively created to regulate air pollution standards.
It has the power to initiate judicial trials in case of violation of environmental laws.
It does not enforce environmental laws related to the protection of wetlands.
It can enforce federal environmental regulations but cannot make regulations on its own.
3. What is “riba” in the context of Islamic law?
It is a compilation of decisions of the prophet.
It refers to the making of unearned profits.
It is the doctrine of proper behavior.
It refers to independent reasoning.
4. The state of Oriel, Selenasia, enacts a law that imposes a 40 percent tax on automobiles that are made outside of Selenasia and sold in the state. However, Oriel does not impose this tax on Selenasian-made automobiles that are sold in Oriel. This scenario resembles a violation of which clause of the U.S. Constitution?
The Multilateral Treaty Clause
The Bilateral Treaty Clause
The Foreign Commerce Clause
The Treaty Clause
5. Teledor Inc. and Comunika Inc. are two competing cellphone manufacturers. Jane, a customer at Teledor, is told by an employee that Comunika phones have weak battery back-up and are very prone to damage. The employee makes these remarks even though he knows that they are completely false. Jane, who has been contemplating between Teledor and Comunika, is influenced by what she hears and purchases a Teledor phone. What kind of intentional tort should be used against Teledor in this scenario?
Malicious prosecution
Disparagement
Battery
Appropriation
This document summarizes the top 10 employment law mistakes made by businesses. It discusses issues like misclassifying employees, not providing meal and rest breaks, not reimbursing expenses, and having unenforceable non-compete agreements. It also mentions a proposed bill that would make it harder for employers to classify workers as independent contractors rather than employees if they fail to properly document the classification. Employers are advised to hire HR professionals knowledgeable about California employment law to avoid costly lawsuits.
This document contains sample exam questions for a law course. The questions cover topics like defenses against sexual harassment charges, EPA powers, Islamic law concepts, constitutional law clauses, intentional business torts, negligence doctrines, contract elements, business organizations, and anti-discrimination laws. It provides multiple choice answers for 43 multiple choice questions.
http://finishedexams.com/homework_text.php?cat=2633
Immediate access to solutions for ENTIRE COURSES, FINAL EXAMS and HOMEWORKS “RATED A+" - Without Registration!
This document discusses several key employment law and tax updates for California employers in 2012, including new laws addressing worker misclassification, discrimination, leave policies, and health insurance coverage. It also provides information on rising workers' compensation insurance costs and strategies for mitigating them. Additionally, it includes tax and benefit limits for 2012 at both the federal and California level as well as information on the IRS voluntary worker reclassification program and complimentary training webinars offered by CPEhr.
CLE Presentation: Narcisa Symank and Jennifer Arendes, Litigation Partner at Armstrong Teasdale
A poorly performing employee realizes he’s going to be fired so he attempts to become a whistleblower by complaining that his boss or co-workers have been violating laws while carrying out company business. Learn how to protect yourself in an increasingly uncertain legal environment.
The choice of a lawyer is an important decision and should not be based solely on this presentation. All rights are reserved and content may not be reproduced, disseminated or transferred, in any form or by means, except with the prior written consent of Armstrong Teasdale.
The issue of whether workers should be classified as employees or independent contractors for federal employment tax purposes has been a source of controversy for decades. The saga continues. This article summarizes a recent Tax Court decision on the classification of a manager in the home care industry.
This document provides an overview of micro captives and the 831(b) election for small insurance companies. It discusses how micro captives allow profitable businesses to deduct insurance premium payments of up to $1.2 million annually. The presenters then explain the key aspects of micro captive structures, including risk distribution requirements, premium funding, financial requirements, and policy types that can be written. The tax benefits of micro captives are outlined, such as deferring tax on underwriting profits and accessing funds for retirement or estate planning purposes.
This newsletter from Judge & Priestley LLP provides updates on recent legal developments affecting clients. It discusses the Help to Buy equity loan scheme that provides government-backed loans for home purchases. It also summarizes the Chancellor's abolishment of stamp duty for most first-time home buyers in England and Wales. Additionally, it covers an employment tribunal case where a bus driver who was fired for running a red light won an unfair dismissal claim due to his long unblemished record.
The FTC routinely holds individuals personally liable for violations of the FTC Act, even without proof of intent to defraud. The FTC can pursue actions against corporate officers, directors, and other management who participated in or had authority to control deceptive practices. Individual liability does not depend on corporate structure and can apply regardless of whether the entity is an Inc., LLC, or other structure. The FTC only needs to show the individual had knowledge of unlawful conduct, not intent to defraud, when pursuing an individual.
Nuts and Bolts of Filling in the New I-9 Formgueste6c2c1
Puzzled by the New I-9 Form effective April 3, 2009? This powerpoint highlights the "Nuts and Bolts" of the new Form and its List of Acceptable Documents. Join the 300 companies who have participated in the national webinar on this topic. Need follow up training and a report card on how well you are doing with your I-9s. email enorman@williamsmullen.com.
A Modern Look at Contractors v. EmployeesDiana Maier
Whether you’re a business owner concerned with making the right distinctions when engaging people to work with/for you, or a lawyer responsible for advising clients on the contractor v. employee distinction, this presentation could save you a lot of grief and money down the line.
Marin County-based employment lawyer Diana Maier and Carlos E. Torres, a Hearing Officer for the California Division of Labor Standards Enforcement (DLSE), discuss which factors matter most in deciding how to classify workers in light of recent legal decisions that are shifting those factors. In addition to covering a broad overview of the contractor v. employee debate, they also discuss ethical considerations for lawyers considering the question of contractor classification, and assess whether the sharing economy is due for extinction in light of recent rulings against companies such as Uber.
12 Tricks Employers use To Cheat Their EmployeesRichard Celler
The document discusses various wage theft violations committed by employers. Data from the Department of Labor shows that over $130 million is collected annually in unpaid overtime claims and over $35 million in minimum wage violations. Low-wage industries experience the highest frequency of wage theft violations. Some common tricks employers use to steal wages include not paying employees for travel time, waiting time, or misclassifying employees as exempt from overtime pay. Wage theft accounts for over $1 trillion in losses annually in the US, which is more than double the amount lost to robbery. The document encourages readers to learn more about their rights and consider consulting an employment lawyer if they believe their employer has committed wage violations.
The document discusses the changing nature of employment laws and the employment relationship over time. It notes that in the 19th century, employment laws favored employers and allowed long work hours and child labor with few protections for employees. However, as societies developed, laws changed to provide employees with rights like fair wages, safe working conditions, and protections against discrimination and unfair dismissal. The document examines factors like control, payment structures, equipment use, and work responsibilities that determine whether a relationship qualifies as employment. It outlines legal obligations employers have regarding taxes, workplace safety, observing employment laws, and complying with employment contracts.
This document summarizes recent key developments in California employment law from 2012-2013. It discusses court rulings related to disability discrimination, reasonable accommodations, discrimination, retaliation, and wage/hour issues. It provides practical compliance steps for employers, such as explaining essential job functions for accommodations, conducting anti-discrimination training, providing clear policies, and making consistent personnel decisions.
The document discusses how CPAs can help clients identify and mitigate employment liability risks. It identifies four key areas of risk: 1) payroll tax liability from misclassifying employees, 2) wage and hour issues from poor timekeeping and misclassifying exempt employees, 3) protecting trade secrets from current and former employees, and 4) discrimination claims from outdated policies and lack of training. For each risk area, it provides examples of problems clients may have and recommendations on how to reduce exposure, such as properly classifying workers, keeping accurate time records, implementing physical and digital security, and conducting regular anti-discrimination training.
White Paper: Complying With Regulations Regarding Temporary Workersss
The use of temporary workers is growing in the United States, now representing 22% of the total workforce. Temporary workers are referred to as freelancers, non-employees, indirect workers, agency contractors, consultants, interns, independent contractors, and many other terms.
Independent Contractors and Employees: Understanding the DifferenceDeirdre Kamber Todd
This document provides an overview of the differences between classifying workers as employees versus independent contractors. It discusses the various tests used by the IRS, US Department of Labor, US Supreme Court and Pennsylvania Department of Labor to determine status. The document notes that no single factor determines classification and that the tests examine the degree of control over the worker and the economic realities of the relationship. It also summarizes the potential consequences of misclassification and an IRS program for voluntarily reclassifying workers.
This document summarizes Utah Senate Bill 81, which requires public employers and contractors to use E-Verify or other status verification systems to check the work authorization of new hires. It discusses how the bill applies to employers, penalties for transporting undocumented immigrants, and increased cooperation with immigration enforcement. Nationally, it notes recent court decisions impacting state immigration laws and the new presidential administration's approach.
Law 531 final exam guide new
http://helpfinalexams.com/homework_text.php?cat=2633
1. What defense can an employer use to a charge of sexual harassment?
The harassed employee was not made aware of the company’s antiharassment policies.
The harassed employee took advantage of the preventive measures provided by the company but still could not avoid being harassed.
The employer does not have any complaint mechanisms for employees who are harassed.
The employer used reasonable care to prevent and correct the sexually harassing behavior.
2. Choose the correct statement about the Environmental Protection Agency (EPA).
It is exclusively created to regulate air pollution standards.
It has the power to initiate judicial trials in case of violation of environmental laws.
It does not enforce environmental laws related to the protection of wetlands.
It can enforce federal environmental regulations but cannot make regulations on its own.
3. What is “riba” in the context of Islamic law?
It is a compilation of decisions of the prophet.
It refers to the making of unearned profits.
It is the doctrine of proper behavior.
It refers to independent reasoning.
4. The state of Oriel, Selenasia, enacts a law that imposes a 40 percent tax on automobiles that are made outside of Selenasia and sold in the state. However, Oriel does not impose this tax on Selenasian-made automobiles that are sold in Oriel. This scenario resembles a violation of which clause of the U.S. Constitution?
The Multilateral Treaty Clause
The Bilateral Treaty Clause
The Foreign Commerce Clause
The Treaty Clause
5. Teledor Inc. and Comunika Inc. are two competing cellphone manufacturers. Jane, a customer at Teledor, is told by an employee that Comunika phones have weak battery back-up and are very prone to damage. The employee makes these remarks even though he knows that they are completely false. Jane, who has been contemplating between Teledor and Comunika, is influenced by what she hears and purchases a Teledor phone. What kind of intentional tort should be used against Teledor in this scenario?
Malicious prosecution
Disparagement
Battery
Appropriation
This document summarizes the top 10 employment law mistakes made by businesses. It discusses issues like misclassifying employees, not providing meal and rest breaks, not reimbursing expenses, and having unenforceable non-compete agreements. It also mentions a proposed bill that would make it harder for employers to classify workers as independent contractors rather than employees if they fail to properly document the classification. Employers are advised to hire HR professionals knowledgeable about California employment law to avoid costly lawsuits.
This document contains sample exam questions for a law course. The questions cover topics like defenses against sexual harassment charges, EPA powers, Islamic law concepts, constitutional law clauses, intentional business torts, negligence doctrines, contract elements, business organizations, and anti-discrimination laws. It provides multiple choice answers for 43 multiple choice questions.
http://finishedexams.com/homework_text.php?cat=2633
Immediate access to solutions for ENTIRE COURSES, FINAL EXAMS and HOMEWORKS “RATED A+" - Without Registration!
This document discusses several key employment law and tax updates for California employers in 2012, including new laws addressing worker misclassification, discrimination, leave policies, and health insurance coverage. It also provides information on rising workers' compensation insurance costs and strategies for mitigating them. Additionally, it includes tax and benefit limits for 2012 at both the federal and California level as well as information on the IRS voluntary worker reclassification program and complimentary training webinars offered by CPEhr.
CLE Presentation: Narcisa Symank and Jennifer Arendes, Litigation Partner at Armstrong Teasdale
A poorly performing employee realizes he’s going to be fired so he attempts to become a whistleblower by complaining that his boss or co-workers have been violating laws while carrying out company business. Learn how to protect yourself in an increasingly uncertain legal environment.
The choice of a lawyer is an important decision and should not be based solely on this presentation. All rights are reserved and content may not be reproduced, disseminated or transferred, in any form or by means, except with the prior written consent of Armstrong Teasdale.
The issue of whether workers should be classified as employees or independent contractors for federal employment tax purposes has been a source of controversy for decades. The saga continues. This article summarizes a recent Tax Court decision on the classification of a manager in the home care industry.
This document provides an overview of micro captives and the 831(b) election for small insurance companies. It discusses how micro captives allow profitable businesses to deduct insurance premium payments of up to $1.2 million annually. The presenters then explain the key aspects of micro captive structures, including risk distribution requirements, premium funding, financial requirements, and policy types that can be written. The tax benefits of micro captives are outlined, such as deferring tax on underwriting profits and accessing funds for retirement or estate planning purposes.
This newsletter from Judge & Priestley LLP provides updates on recent legal developments affecting clients. It discusses the Help to Buy equity loan scheme that provides government-backed loans for home purchases. It also summarizes the Chancellor's abolishment of stamp duty for most first-time home buyers in England and Wales. Additionally, it covers an employment tribunal case where a bus driver who was fired for running a red light won an unfair dismissal claim due to his long unblemished record.
The FTC routinely holds individuals personally liable for violations of the FTC Act, even without proof of intent to defraud. The FTC can pursue actions against corporate officers, directors, and other management who participated in or had authority to control deceptive practices. Individual liability does not depend on corporate structure and can apply regardless of whether the entity is an Inc., LLC, or other structure. The FTC only needs to show the individual had knowledge of unlawful conduct, not intent to defraud, when pursuing an individual.
Nuts and Bolts of Filling in the New I-9 Formgueste6c2c1
Puzzled by the New I-9 Form effective April 3, 2009? This powerpoint highlights the "Nuts and Bolts" of the new Form and its List of Acceptable Documents. Join the 300 companies who have participated in the national webinar on this topic. Need follow up training and a report card on how well you are doing with your I-9s. email enorman@williamsmullen.com.
A Modern Look at Contractors v. EmployeesDiana Maier
Whether you’re a business owner concerned with making the right distinctions when engaging people to work with/for you, or a lawyer responsible for advising clients on the contractor v. employee distinction, this presentation could save you a lot of grief and money down the line.
Marin County-based employment lawyer Diana Maier and Carlos E. Torres, a Hearing Officer for the California Division of Labor Standards Enforcement (DLSE), discuss which factors matter most in deciding how to classify workers in light of recent legal decisions that are shifting those factors. In addition to covering a broad overview of the contractor v. employee debate, they also discuss ethical considerations for lawyers considering the question of contractor classification, and assess whether the sharing economy is due for extinction in light of recent rulings against companies such as Uber.
12 Tricks Employers use To Cheat Their EmployeesRichard Celler
The document discusses various wage theft violations committed by employers. Data from the Department of Labor shows that over $130 million is collected annually in unpaid overtime claims and over $35 million in minimum wage violations. Low-wage industries experience the highest frequency of wage theft violations. Some common tricks employers use to steal wages include not paying employees for travel time, waiting time, or misclassifying employees as exempt from overtime pay. Wage theft accounts for over $1 trillion in losses annually in the US, which is more than double the amount lost to robbery. The document encourages readers to learn more about their rights and consider consulting an employment lawyer if they believe their employer has committed wage violations.
The document discusses the changing nature of employment laws and the employment relationship over time. It notes that in the 19th century, employment laws favored employers and allowed long work hours and child labor with few protections for employees. However, as societies developed, laws changed to provide employees with rights like fair wages, safe working conditions, and protections against discrimination and unfair dismissal. The document examines factors like control, payment structures, equipment use, and work responsibilities that determine whether a relationship qualifies as employment. It outlines legal obligations employers have regarding taxes, workplace safety, observing employment laws, and complying with employment contracts.
This document summarizes recent key developments in California employment law from 2012-2013. It discusses court rulings related to disability discrimination, reasonable accommodations, discrimination, retaliation, and wage/hour issues. It provides practical compliance steps for employers, such as explaining essential job functions for accommodations, conducting anti-discrimination training, providing clear policies, and making consistent personnel decisions.
This short document promotes creating presentations using Haiku Deck, a tool for making slideshows. It encourages the reader to get started making their own Haiku Deck presentation and sharing it on SlideShare. In just one sentence, it pitches the idea of using Haiku Deck to easily create engaging slideshow presentations.
Interactive Direct Mailer
We have been using simple direct mailer to reach our customers in a while.Introducing interactive direct mailers where we can always convey our information with small graphical representation or animated infographics. This is quite attractive then regular boring mails. Kindly see the sample below.
Chandrakant Shakya has over 2 years of experience developing Java and Android applications. He has worked on projects involving network management, Linux systems, and mobile app development. Currently, he is an Android developer at 3D Inc where he builds applications for multiple operating systems using Java programming concepts. Previously, he was a trainee engineer at Betasoft Pvt Ltd where he designed and developed Android apps. He has a Bachelor's degree in Computer Science and Engineering.
This short document promotes creating presentations using Haiku Deck, a tool for making slideshows. It encourages the reader to get started making their own Haiku Deck presentation and sharing it on SlideShare. In just one sentence, it pitches the idea of using Haiku Deck to easily design slideshows.
Wollmuth Maher & Deutsch LLP -Takeaways From The SEC Cybersecurity Examinatio...Jason Glass, CFA, CISSP
The SEC's Office of Compliance Inspections and Examinations conducted cybersecurity examinations of over 100 financial services firms in 2014. The examinations focused on firms' governance, protection of networks and information, risks associated with vendors and third parties, and risks associated with remote access. OCIE found that while firms were generally conducting risk assessments and maintaining security policies, there was uneven adoption of best practices in several key areas like incident response planning, vendor oversight, and client education. The report suggests that all financial services firms review their cybersecurity programs and address any gaps identified by OCIE's findings.
Ошибки и особенности подготовки расчета 6-НДФЛ в конфигурации 1С:Зарплата и у...Елена Коптева
Презентация для вебинара "Ошибки и особенности подготовки расчета 6-НДФЛ в конфигурации 1С:Зарплата и управление персоналом 3.0". Ведущая - Наталья ГРЭДИНАР – программист-консультант 1С, компания "Кодерлайн".
This document contains a list of 10 photo credits attributed to various photographers. It concludes by encouraging the reader to create their own presentation using Haiku Deck on SlideShare.
1) 95% of participants in a two-year weight loss study were willing to pay for continued lifestyle intervention, with a median monthly amount of $45, similar to commercial programs.
2) Black participants were willing to pay more ($65/month) than non-Black participants. Weight loss success did not impact willingness to pay.
3) The order that payment options were presented influenced willingness to pay amounts, with lower initial options yielding lower reported maximum payments.
The document discusses the evolution of military branches from past to present. In the past, armies had three main branches: cavalries, archers, and infantry. Over time, the use of firearms became more common, starting with cannons in the 13th century. This led to changes in military tactics and organization. Archers decreased in importance as infantrymen took their place on the battlefield. By World War 2, cavalry troops were obsolete and the last cavalry attack was carried out against German tanks. Today, infantry remains as the primary ground fighting force.
1) The study examined whether serum carbon isotope values (d13C), which reflect consumption of corn- and cane-based foods like sugar-sweetened beverages (SSBs), change in response to changes in SSB intake over an 18-month behavioral intervention trial.
2) At baseline, average SSB intake was 13.8 ounces per day and average serum d13C value was -19.3 per mil. A reduction of 12 ounces per day in SSB intake was associated with a 0.17 per mil reduction in serum d13C.
3) After adjusting for potential confounders, a reduction of 12 ounces per day in SSB intake over 18 months was associated with a
The document is a newsletter from the law firm Judge & Priestley LLP providing updates on recent legal developments. It summarizes two court cases, one where a company successfully claimed negligence against its brokers for failing to inform it of an insurance policy condition, and another where an estate agent was not entitled to commission due to failings in the oral contract. It also announces the acquisition of another law firm, Preston Mellor Harrison, expanding the private client services.
ACC Docket Article July/August 2010, Immigration Consequences of Corporate R...martinvisalaw
The document discusses the effect of corporate restructuring, such as mergers and acquisitions, on a company's foreign national employees and their immigration status. It notes that corporate counsel needs to consider immigration issues before finalizing any restructuring to ensure compliance and avoid complications. Failing to do so can result in costly delays and extra paperwork. The summary provides an overview of key issues that may arise for different types of visa holders, such as H-1B, L-1, E, and TN visa employees, and the steps companies can take to help maintain employees' status through a restructuring.
Foley v. Interactive Data Corp. (1988) 47 C3d 654 [After .docxbudbarber38650
Foley v. Interactive Data Corp. (1988) 47 C3d 654
[After Interactive Data Corporation fired plaintiff Daniel D. Foley, an executive employee, he filed this
action seeking compensatory and punitive damages for wrongful discharge. Foley asserted several
distinct theories for wrongful discharge, including a tort cause of action alleging a discharge in violation of
public policy and a contract cause of action for breach of an implied-in-fact promise to discharge for good
cause only.
The Court of Appeal determined that Foley alleged no statutorily based breach of public policy sufficient
to state a cause of action, and that his claim for breach of implied contract to discharge only for good
cause was barred by the statute of frauds. The California Supreme Court granted review to consider the
Court of Appeal determinations.]
* * * *
Facts
* * * *
According to the complaint, plaintiff is a former employee of defendant, a wholly owned subsidiary of
Chase Manhattan Bank that markets computer-based decision-support services. Defendant hired plaintiff
in June 1976 as an assistant product manager at a starting salary of $18,500. As a condition of
employment defendant required plaintiff to sign a "Confidential and Proprietary Information Agreement"
whereby he promised not to engage in certain competition with defendant for one year after the
termination of his employment for any reason. . . . It did not state any limitation on the grounds for which
plaintiff's employment could be terminated.
Over the next six years and nine months, plaintiff received a steady series of salary increases,
promotions, bonuses, awards and superior performance evaluations. In 1979 defendant named him
consultant manager of the year and in 1981 promoted him to branch manager of its Los Angeles office.
His annual salary rose to $56,164 and he received an additional $6,762 merit bonus two days before his
discharge in March 1983. He alleges defendant's officers made repeated oral assurances of job security
so long as his performance remained adequate.
Plaintiff also alleged that during his employment, defendant maintained written "Termination Guidelines"
that set forth express grounds for discharge and a mandatory seven-step pretermination procedure.
Plaintiff understood that these guidelines applied not only to employees under plaintiff's supervision, but
to him as well. On the basis of these representations, plaintiff alleged that he reasonably believed
defendant would not discharge him except for good cause, and therefore he refrained from accepting or
pursuing other job opportunities.
The event that led to plaintiff's discharge was a private conversation in January 1983 with his former
supervisor, Vice President Richard Earnest. During the previous year defendant had hired Robert Kuhne
and subsequently named Kuhne to replace Earnest as plaintiff's immediate supervisor. Plaintiff learned
that Kuhne was currentl.
The Court of Appeal upheld a dismissal for breakdown of trust where the employment tribunal considered all relevant facts. However, a breakdown of trust cannot be a convenient label for dismissal without lawful reasons. The duty to make reasonable adjustments for a disabled employee does not necessarily end when the employee goes on sick leave. An employment tribunal awarded compensation to an employee who was victimized after complaining of racist behavior. For a transfer of staff to occur under TUPE, there must be a deliberate grouping of employees organized for the specific client work. Selection criteria for redundancy must be applied consistently and objectively.
This article discusses increased crackdowns by federal and state governments on companies misclassifying regular employees as independent contractors to avoid payroll taxes and legal obligations to employees. The Obama administration aims to hire more enforcement personnel and rewrite IRS rules to close loopholes. Studies find millions of misclassified workers cost governments billions in lost tax revenues annually. Affected workers are denied benefits and legal protections.
This article discusses increasing crackdowns by federal and state governments on companies misclassifying regular employees as independent contractors to avoid payroll taxes and legal obligations to employees. The Obama administration aims to hire more enforcement personnel and rewrite IRS rules to close loopholes. Studies find millions of misclassified workers cost governments billions in lost tax revenues annually. Workers denied benefits and protections include truckers, construction workers, and home health aides. Stricter enforcement addresses an unfair competitive advantage and denies basic worker rights and protections.
This article discusses increasing crackdowns by federal and state governments on companies misclassifying regular employees as independent contractors to avoid payroll taxes and legal obligations to employees. The Obama administration aims to hire more enforcement personnel and rewrite IRS rules to close loopholes. Studies find millions of misclassified workers cost governments billions in lost tax revenues annually. Workers denied benefits and protections include truck drivers, construction workers, and home health aides. Stricter enforcement addresses an unfair competitive advantage and denies basic worker rights and protections.
Legal newsletter focussing on employment matters including articles on worker status and the implications of the gig economy and shared parental leave
and grandparental leave.
Carolyn Elefant, an attorney who owns a boutique energy law practice and freelance legal marketplace, writes to request that the Maryland State Bar Association rescind its 1992 ethics opinion prohibiting lawyers from marking up the costs of freelance attorneys. The opinion is outdated as the legal profession has embraced freelance arrangements and the gig economy. Allowing markups benefits clients through lower overall rates, solo and small firm lawyers by incentivizing the use of lower-cost freelancers, and freelance attorneys by providing them work opportunities. Most other ethics authorities, including the ABA, permit reasonable markups. Rescinding the opinion would bring Maryland in line with the modern legal industry while supporting cost-effective and flexible legal services.
The document is a newsletter from the law firm Judge & Priestley LLP providing updates on legal developments. It summarizes that the firm has been recognized in the Legal 500 directory for the high quality of its social housing and debt recovery departments. It also provides brief summaries of several legal cases and new laws relating to issues like competition law, landlord tenant disputes, employment law, and actions against rogue landlords and illegal immigrants.
Views on the Recent USAM Changes: An Interview with The FCPA ReportPaul Hastings
Nathaniel Edmonds was interviewed by The FCPA Report’s Nicole Di Schino about the implications of the recent changes to the U.S. Attorney’s Manual (USAM).
Tony and Lily want to expand their audio-video equipment rental business and need additional capital of RM100,000. Tan is willing to provide the money but does not want to become a partner or take on any business liabilities. However, he wants to be employed as a bookkeeper at RM3,000 per month and receive 10% of annual profits until the loan is repaid over three years. Section 4 of the Partnership Act establishes tests for determining if a partnership exists. Based on the facts and the Act, Tan would likely be considered an employee and not a partner since he does not intend to be a partner or take on liabilities, and his profit share and salary are remuneration for his services as
The document discusses employment equity and affirmative action policies and how they were implemented at Defy Appliances Ltd in 1999, covering what employment equity and affirmative action are, how the policies work, obstacles faced in implementation, and the conclusion that the policies led to greater representation of designated groups in companies in South Africa. It provides details on the contents and implementation of South Africa's Employment Equity Act of 1998.
Case Teaching Resources F R O M T H E E V A N S S C H O O .docxtidwellveronique
Case Teaching Resources F R O M T H E E V A N S S C H O O L O F P U B L I C A F F A I R S
T h e
E l e c t r o n i c H a l l w a y ®
Box 353060 · Universi ty of Washington · Seattle WA 98195-3060 www.hallway.org
This Kennedy School of Government case study has been distributed on The Electronic Hallway system under a
cooperative agreement between the Public Service Curriculum Exchange and the Kennedy School of Government Case
Program, Harvard University. This case was written by Pamela Varley with direction from Assistant Professor Micael
Barzelay for teaching use at the John F. Kennedy School of Government, Harvard University. (0787)
The Electronic Hallway is administered by the University of Washington's Daniel J. Evans School of Public Affairs. This
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Copyright 2000 The Electronic Hallway
Denise Fleury and the Minnesota Office of State Claims
Introduction
When Denise Fleury left the private sector to become head of the Minnesota Office of
State Claims in June 1984, she knew the job would be challenging. Recent changes in
Minnesota’s worker’s compensation law had broadened the mission of State Claims,
which administered worker’s compensation benefits for allstate employees. As the
incoming manager of the office, Fleury was expected to re-orient State Claims to meet
these new responsibilities and to make sure that supervisors throughout state government
complied with the new law, as well.
When she took the job, however, Fleury did not realize how badly State Claims was
handling its old responsibilities. She soon found scrambling to cope with day-to-day
crises while trying to assume a host of new tasks. By the end of her first year, Fleury had
made real headway, but office operations continued to suffer from misunderstandings,
mistakes, and missed deadlines, which exasperated her staff as well as the employees and
agencies they served. Fleury was anxious to resolve these problems, but felt that she did
not understand the details of the office paper flow well enough to sort them out herself—
nor did she have the time to tackle such a job.
Background
In Minnesota, both public and private sector employers are required by law to pay for the
medical treatment of any employee who suffers a work-related injury and to pay lump-
sum awards for permanent injuries, such as the loss of a limb. In addition, employers
must provide “lost time” compensation (two-thirds the worker’s salary) to any employee
who misses more than three days of work due to a work-related injury.
Most private sector employers buy insurance to cover ...
The document discusses the definition of a "contract of service" and "employee" under Malaysian employment law. It provides an overview of factors that determine an employment relationship such as control tests, implied terms of a contract of employment, relevant legislation, and important court cases that have helped define these concepts. The control test, organization test, and implied duty of mutual trust and confidence are some key considerations examined in determining whether a worker is an employee under a contract of service.
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In a separate case, a judge ruled that provisions allowing variation of periodic damages payments under the Damages Act 1996 could be used in non-exceptional circumstances. The Court of Appeal dismissed an appeal against this interpretation.
A third case discussed involved a borrower, Eric, who took out a loan for
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Extranjeros perseguidos por violar la FCPA. La saga de siemmens continúaAndres Baytelman
The U.S. brought criminal and civil charges against eight former executives of Siemens AG and its Argentine subsidiary for their roles in a decade-long bribery scheme involving $100 million in bribes to secure a $1 billion contract in Argentina. This marks the U.S. government's continued efforts to prosecute individuals, not just corporations, for FCPA violations. Additionally, the charges show that the U.S. will assert jurisdiction over foreign citizens for FCPA matters and target high-level executives. The DOJ collaborated with German prosecutors to bring the charges as other countries also implement their own anti-corruption laws.
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Similar to Stemm v tempworks order for judgment (20)
Explore the key differences between silicone sponge rubber and foam rubber in this comprehensive presentation. Learn about their unique properties, manufacturing processes, and applications across various industries. Discover how each material performs in terms of temperature resistance, chemical resistance, and cost-effectiveness. Gain insights from real-world case studies and make informed decisions for your projects.
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STATE OF MINNESOTA DISTRICT COURT
COUNTY OF HENNEPIN FOURTH JUDICIAL DISTRICT
Case Type: Contract/Other
David & Hiba Stemm, LLC,
a Kentucky limited liability company,
and James David Stemm, individually,
and Hiba George-Stemm, individually,
Plaintiffs,
v.
TempWorks Management Services Inc.,
Defendant.
Court File No: 27-CV-14-3571
FINDINGS OF FACT,
CONCLUSIONS OF LAW
AND ORDER FOR JUDGMENT
This matter came before the Court for a trial without a jury on December 8, 9 and 10,
2014. Plaintiffs were represented by George E. Antrim, III, Esq., George E. Antrim, III, PLLC.
Defendant wwas represented by John H. Reid, Esq., TempWorks Management Services, Inc.,
and Daniel J. Cragg, Esq., ECKLAND & BLANDO LLP. Based upon all of the evidence admitted
and the testimony received, the Court makes the following:
FINDINGS OF FACT
1. Plaintiff David Stemm (“Stemm”) has extensive experience in the temporary
staffing industry from working with Employment Plus, a staffing agency. Stemm joined
Employment Plus as its Risk Manager in January 1998. Stemm’s responsibilities were to design,
implement and manage Employment Plus’s Risk Management program. Part of his responsibility
was to negotiate workers compensation insurance.
2. Employment Plus grew rapidly. When Stemm started, Employment Plus was four
offices and had about $1 million in sales. By 2000 sales had doubled to $2 million. Sales
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increased to $6 to $10 million by 2004.
3. After 2000 Stemm transitioned into Operations Management with responsibilities
for managing all branch functions, hiring personnel, contract negotiations and overall customer
service in the event an account was not going favorably. Stemm was eventually placed in charge
of Employment Plus’s largest profit center – the Onsite Division --which developed techniques
for staffing large industrial customers who might use 1200 temporary employees a week.
4. Stemm resigned in 2006 to take on a private venture in Idaho. He returned around
March 2010, to start the Healthcare Staffing division for Employment Plus in Indiana. Although
Stemm hoped to transition clients from a temporary dental service that Employment Plus’s
owner Mike Ross had bought, these clients did not stay. Stemm had to get new clients.
5. Around July 2010, Stemm hired Eric Pattison (“Pattison”) to work in Fishers,
Indiana for Employment Plus Healthcare division. Pattison had contacts in the industry that
helped in acquiring customers. While Pattison was employed by the Healthcare division, he was
the only operational employee.
6. In 2010, sales for the Healthcare division were between $200,000 - $250,000.
Stemm testified that after burden, overhead and the salaries for him and Pattison were accounted
for, the business would have been operating at break even. Stemm testified that payroll, which
the total is paid to the temporary workers, would have been between $125,000 - $150,000. The
court finds that this means that in 2010 there was between $50,000 - $125,000 left to cover
burden and salaries to Stemm and Pattison. Stemm provided no information about how much he
or Pattison were paid from these revenues. Stemm testified that in 2011, sales and payroll
increased 10% and that profits probably increased because of wider margins but supplied no
specifics. Again no information was provided as to how much Pattison was paid.
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7. In contrast to Stemm’s assertions of increased sales, Michael Testy, the former
controller and VP of Finance for Employment Plus, testified that from records he had seen, the
Healthcare division in 2011 billed 17,977 hours, nearly 800 fewer hours than the 18,750 hours it
had billed in 2010, about a 4% decrease. And the hours billed decreased another 4500 hours in
2012 to 13,473 hours, about a 25% decrease. But he provided no specifics about whether profit
increased or decreased between those years. Because billing rates and burdens differed from job
to job, billable hours could result in varying degrees of profit. The records themselves were not
produced. Testy also relied on incomplete data for 2013 to extrapolate total actual hours billed
for 2013. Although Testy testified that if 5 months of actual hours billed for the entire
Healthcare division were extrapolated for 12 months, actual hours billed would have been
22,391, showing a significant increase in hours billed for the entire Healthcare division from
2012 to 2013, the court finds this to be too speculative to be reliable. The court finds that there is
insufficient evidence to conclude that profits increased at any time in the Healthcare division.
8. Stemm moved to Massachusetts in May 2011, after marrying, but remained the
Director of Employment Plus Healthcare.
9. In October 2011, Mr. Stemm left Employment Plus to focus on growing his
previously-organized business, David & Hiba Stemm LLC (the “Plaintiff LLC”). It was
organized on August 8, 2011 for the purpose of operating as a temporary employment staffing
agency. David Stemm is a 49 percent owner of the Plaintiff LLC; his wife, Hiba Stemm, is a 51
percent owner. (Exhibit 2.) The Plaintiff LLC’s d/b/a name was “180 Personnel.”
10. Stemm contacted Defendant TempWorks Management Services Inc.
(“TempWorks” or “TMS”) to assist him in starting up his staffing company. TMS was an
affordable alternative for a start-up because of its lack of front end investment.
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11. On or about February 1, 2012, 180 Personnel entered into a contract with
TempWorks Software, Inc. regarding website design. (Exhibit 3). The cost for the website was
$4,100. Because the website is linked to software owned by TMS, it no longer is useful to
Stemm or 180 Personnel. He cannot access anyone that might try to contact the website.
12. About a year later Stemm saw an opportunity to start the business. In mid-2013,
Pattison became available. He had recently been replaced by a cheaper employee at Employment
Plus, Healthcare. Stemm asked Pattison if he would like to work for 180 Personnel.
13. Knowing that clients tended to by loyal to their representative rather than to a
company, Stemm perceived a “window of opportunity” in the Indiana market as a result of
Pattison’s termination. By utilizing the services of TMS, Stemm believed the Indiana-based
clients of Employment Plus could immediately transition to 180 Personnel, without need for a
ramp-up period or outlay of significant capital because of their close working relationship with
Pattison. Because of these relationships, Pattison was considered by Stemm to be the “lynchpin”
of the Plaintiff LLC’s business plan.
14. Five major clients accounted for a large percentage of Employment Plus
Healthcare business. These were Goodman Campbell, Kevin Ward, Otolaryngology Associates,
Meridian, and Podiatry Associates. Stemm testified that these five had historical billings with
Employment Plus of about $100,000 a year. Stemm testified credibly that the business from
these five was steady and reliable. Stemm reasonably believed that these five clients would
follow Pattison.
15. Although Pattison was subject to a covenant not to compete with Employment
Plus, Stemm testified credibly that Employment Plus assured him that it would not enforce the
non-compete if Pattison went to work for Stemm in Indiana and clients wanted to follow him.
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Defendant presented no contrary evidence that Stemm and Pattison should not have reasonably
relied on this representation.
16. Pattison accepted Stemm’s offer to join 180 Personnel in mid-2013. Stemm
testified that Pattison was an independent contractor but Stemm viewed him as an informal
partner. No evidence was introduced as to what 180 Personnel would pay Pattison.
17. Having secured Pattison, Stemm put the other pieces in place to start the
temporary staffing business. He hoped to work in both Massachusetts and Indiana, but because
of Pattison focused his efforts on Indiana. One major obstacle was day to day operations. Casey
Kraus (“Kraus”) of TempWorks recommended that Stemm consider the entire suite of services
afforded by TMS in addition to the website because it would provide all the services the Plaintiff
LLC needed under one roof. Kraus had Tempworks employee Bob Pugliano take the lead in
working with Stemm.
18. On July 8, 2013, Stemm told Kraus that he would like to utilize “employee of
record” services from TMS (Exhibit 9). Stemm provided background information to TMS such
as a credit check and return on investment. There were no issues with these background checks.
TMS personnel stated that the credit checks were excellent ( Exhibit 12).
19. After reviewing the background information TMS decided to enter into a contract
with Plaintiff LLC. The parties agree that there is a contract between Plaintiff LLC and TMS for
the provision of “employer of record” services (the “Agreement”) (Exhibit 14), which was
entered into between July and August 2013. Although TMS did not sign the Agreement, it has
stipulated to the contract’s validity. David and Hibba Stemm also signed as personal guarantors.
20. Under the agreement, 180 Personnel was responsible to find customers that
needed staffing and to find the people who would be placed. These people were referred to as
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Staff Consultants. TMS would be the employer of record (“EOR”) and provide all the necessary
“back office” work needed. TMS would provide workers’ compensation insurance, front and
back office staffing, software, tax and accounting services, payroll processing services, capital,
human resources services, accounts receivable, and other miscellaneous staffing services.
Although Stemm could have contracted for all of these services separately it was much quicker
to use TMS for everything. And TMS did not require any front end payment.
21. The Plaintiff LLC would collect a “commission” upon payment to TMS of any
invoice by a customer/client. The Agreement specified that the commission would be equal to
any money remaining from an invoice payment after TMS deducted its “Management Fees”.
Management Fees included the actual costs of payroll and fees for Staffed Consultants incurred
by TMS, plus a 3.99% Administrative Fee. (Exhibit 14 Ex A). Tempworks COO Mari
Kautzman (“Kautzman”) testified credibly that the 3.99% Administrative Fee did not include the
cost of workers compensation insurance. This cost would be added to the cost of payroll.
22. The Agreement required that people could not be placed as employees of TMS
unless they had been approved by TMS. (Exhibit 14 para 2.3).
23. The Agreement provided that TMS could terminate the agreement under certain
conditions. The following section is particularly important to this case because it is the section
that TMS relies on to justify its termination of the contract with Plaintiff LLC.
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24. Tempworks knew that 180 Personnel wanted to start in the fall of 2013. On July
12, 2013 Stemm emailed Casey Kraus asking specifics about the timeframe to actual operation.
He said that “we have a given start date of Sept. 1 and that is our planned date at which we can
send a person to work.” Stemm asked if the start date was possible or impossible, noting that he
would need to do paperwork for applicants a few weeks in advance and secure utilities and office
leases. Mr. Kraus assured Stemm the same day that “Assuming that we get all of the paperwork
taken care of in a timely fashion, it shouldn’t be an[sic] problem to get you up and running in a
couple of week.[sic]” (Exhibit 13 TMS03363-64). At no point did anyone at TMS tell Stemm
that September 1, was an unrealistic start date.
25. The website was operational in the summer of 2013. It was linked to TMS
Enterprise software in September 2013.
26. On August 20, 2013, Ashlee Brace (“Brace”), who would serve as the Project
Manager for 180 Personnel, sent Stemm the “Welcome to TempWorks” PDF outlining the
information that TempWorks would need for the underwriting process. (Exhibit 15).
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27. Throughout his relationship with TMS, Stemm timely provided all the
information that he was requested and that was required. No evidence was raised that Stemm
failed to provide adequate information.
28. Due to problems on his end Stemm changed the target date from September 1 to
October 1, 2013. Stemm testified credibly that TMS employees Bob Pugliano and Ashlee Brace
knew that October 1, 2013 was the targeted start date. The court finds that TMS knew of the
October 1 start date, knew that meeting the date was important because of prospective customers
that would accept workers on October 1, and never indicated to Stemm that there was any reason
he could not rely on being able to start on October 1. Stemm and Plaintiff LLC reasonably relied
on representations from TMS that 180 Personnel could begin operations October 1.
29. Stemm took steps for 180 Personnel to be able to do business on October 1.
Stemm set up bank accounts in Indianapolis for 180 Personnel and got marketing materials.
Stemm spent his own money on these items and expected to pay himself back from the 180
Personnel account after the business was making money. Stemm flew to Indianapolis to meet
with the five significant potential customers. They indicated that they were willing to do
business with 180 Personnel.
30. On August 23, 2013, Stemm signed a one-year lease for an office in Plymouth,
Massachusetts for $340 a month. He intended to use this office as a base for the staffing
business as well as for another business venture he had with a Massachusetts drug testing
company. That other venture required that he have an office outside of his home to accept
shipments. Because he needed this office for the other venture, the court finds that Stemm would
have incurred these offices expenses regardless of the TMS contract.
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31. Stemm submitted potential customers/clients to TMS for approval and they were
approved for credit on September 18, 2013. (Exhibit 23). The court finds that Plaintiff LLC and
TMS in September 2013 were actively going through the approval process for workers to be
placed at Otolaryngology Associates, Meridian and Goodman Campbell, and at least two clients
were approved.
32. No customer signed a contact with TMS guaranteeing a certain minimum number
of requests for employees or a certain amount of business. Such guaranteed contracts are not
typical because flexibility is one of the many reasons to use temporary staffing.
33. Stemm submitted two potential Staff Consultants for approval on September 24,
2013, but TMS canceled the contract with Plaintiff LLC before they were approved or
disapproved. There was no evidence that either potential employees posed any problems. The
court finds that but for the cancellation of the contract, the employees would have been
approved, and Plaintiff LLC could have started placing some temporary workers on October 1 if
TMS had provided workers’ compensation assurances. Although there was at least one other
available worker who could have been submitted for approval, the initial placements that were
ready for October 1 were less than what Employment Plus had been providing.
34. The court finds that Stemm and Plaintiff LLC had done everything necessary to
meet TMS requests and to be ready to start business on October 1. The court finds that the
primary remaining obstacle for placing workers on October 1, 2013 was an assurance from TMS
that workers’ compensation was in place.
35. TMS promised to provide workers’ compensation for the Staff Consultants. (The
Agreement Para 4.1) This became a critical issue in this case. TMS testified that it was always
prepared to provide worker’s compensation coverage when needed and could have gotten it at
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any time. But the course of events in this case raised a reasonable concern in Stemm’s mind as
to whether workers’ compensation would be available in order to have his Staff Consultants
placed on October 1, 2013.
36. On July 8, 2013 Kraus told Stemm in an email that TMS was not bound for
insurance in Indiana. (Exhibit 9). TMS intended to provide the workers’ compensation that
would be needed for the 180 Personnel staffing through a company called Direct HR. The agent
at Direct HR that TMS worked with was Mike Sepsey.
37. As the October 1 start date approached, Stemm told Brace that the potential
customers needed proof that the workers’ compensation was in place. On September 24, Stemm
emailed Brace that Otolaryngology needed proof of insurance prior to giving an “official” order.
In response, Brace said that she had “just received confirmation that we will be binding coverage
on your codes today” and that she would have certificates of insurance by the next day,
Wednesday September 25 (Exhibit 34).
38. To finalize the workers’ compensation coverage, certain employee information
needed to be sent to Direct HR. TMS did not want to send this information itself, and instead on
Tuesday, September 24, 2013 at 3:03 p.m., Brace instructed Stemm or Pattison to send the
information directly to Mike Sepsey (Exhibit 35). Stemm was not told that he could not call
Sepsey.
39. Stemm submitted two employees for approval to Mike Sepsey at Direct HR on
September 24 and expected to receive approval within one hour, as TMS had said was the usual
approval time. But he heard nothing on September 24.
40. On the morning of Wednesday, September 25, 2013, Stemm called Sepsey to see
if Sepsey had all the information that he needed to approve the employees. Although Stemm
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testified that he does not recall saying that the workers were the employees of 180 Personnel, the
court finds that Stemm identified 180 Personnel as an employment agency and asked about the
status of his temps, or said something else, which created some confusion with Sepsey about
who was the employer of record. Sepsey said that Direct HR would not cover the employees and
that “it was going to be a problem” for 180 Personnel to do business in Indiana. He refused to
answer any of Stemm’s questions, stating, “You are not my client. TempWorks is my client,”
and indicated that he was immediately calling Pugliano or Brace at TempWorks.
41. Sepsey then emailed Brace and Pugliano in the morning of September 25. He said
that Direct HR could not cover 180 Personnel employees under workers’ compensation because
their “carrier did not allow their staffing company to staff for other staffing companies.” (Exhibit
36 at 801). Direct HR was willing to supply workers’ compensation for TMS employees but not
for employees of 180 Personnel.
42. Pugliano assured Stemm that this was a miscommunication that would be
resolved quickly. However, during the rest of Wednesday September 25, Stemm was not told
that the problem was resolved. He spoke to Pugliano three times during that day and was told
each time that everything was fine and Stemm just needed to wait a few more hours.
43. In fact, everything was not fine. Although Brace immediately emailed Sepsey on
the morning of September 25 to clarify that TMS was the employer of record, Sepsey told
Pugliano that affiliates of TMS should not call Direct HR to approve employees. Pugliano
suggested to Brace around noon on September 25 that the problem could be resolved if TMS
took the lead with Direct HR on getting employees approved (Exhibit 36).
44. In a series of internal TMS emails addressed to COO Mari Kautzman, Casey
Kraus, CEO David Dourgarian, Ashlee Brace and Bob Pugliano on Thursday September 26, it
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became clear that TMS had serious concerns about a resolution that would require more input
from TMS employees. Pugliano first explained that even though Direct HR had previously
allowed affiliates like 180 Personnel to send in approval information, the process had to change.
Direct HR was now requiring that all temp approval documentation be sent by TMS. Casey
Kraus responded that this is a “logistical nightmare” and that “it is not worth sinking salary
expenses into another person to do the paperwork.” Pugliano suggested that clerical time could
be minimized if 180 Personnel did the paperwork and send it to TMS to forward on to Direct
HR. Kautzman replied that she did not understand the need for a change and that these clerical
hours would be “meaningless” and “could be used doing something beneficial to our company
and its profitability.” At about 2:25 pm on Thursday Pugliano said “If we want to do business
with Direct HR moving forward, this is how we have to do it. If not, we don’t. I don’t make the
call. I am informing you of the facts. Make the call.” No decision was made that day. Kautzman
emailed that she would phone Sepsey and “straighten this out.” At 4:03 pm Pugliano asked the
higher ups to let him know what they decided, because he was in the process of writing a letter
and contract dealing with 180 Personnel for Direct HR to give to its workers’ compensation
carrier. Pugliano reminded everyone that 180 Personnel expected to place people the following
week. (Exhibit 40). No further evidence was provided about what the letter or contract would
have said. The court finds that Pugliano was preparing a letter and contract that would have
required TMS employees to send approval information to Direct HR, which at that time was the
only solution that Pugliano knew Direct HR would accept.
45. The court finds that TMS was unhappy that it might take more clerical time than
anticipated to get workers compensation coverage for 180 Personnel. TMS was considering
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dropping its relationship with Direct HR but at this point had proposed no alternative for getting
180 Personnel workers’ compensation coverage in time to start business on October 1.
46. Pugliano told Stemm on Thursday that he had resolved the issue of getting
approval from Direct HR, and was writing a letter and contract to Mike Sepsey that Stemm
would be copied on. Despite Pugliano’s assurances to Stemm, this issue was not resolved on
September 25 because Pugliano had not heard from Kautzman about whether TMS was willing
to do the extra clerical work needed to get employee approval from Direct HR.
47. Stemm had not received any letter resolving the situation by the morning of
Friday September 27.
48. On the morning of Friday, September 27, 2013 at about 8:30 am CST Stemm
called Pugliano. Pugliano said that the COO, Kautzman, had resolved the issue without sending
the letter but that he was simply awaiting word from Kautzman within half an hour. This was a
false assurance. Shortly after this call at 8:42 am CST Pugliano emailed Mari Kautzman, and
copied CEO Dourgarian and Brace, and asked Kautzman to report on her alleged call with
Sepsey the previous day, and to advise him on how to proceed with 180 Personnel. (Exhibit 42).
Stemm called Pugliano back 29 minutes later at 8:59 a.m. CST. Pugliana gave Stemm an
excuse and promised to call in another half hour. The court finds that at this point Pugliano did
not know whether or not Kautzman had reached a resolution and had falsely told Stemm there
was a resolution.
49. Having heard nothing an hour later about 10:00 am CST, Stemm tried to call
Kautzman and was told she was in training. He tried to call Pugliano and was sent to voicemail,
which was unusual. The court finds that it was reasonable for Stemm to be concerned that the
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problem with Direct HR approving the employees was not yet completely resolved. Stemm
decided to call Sepsey at 10:07 am CST.
50. Sepsey again told Stemm that communications with Direct HR needed to come
through TMS. He said he was waiting for paperwork from TMS so that they could do business.
Sepsey then emailed Pugliano at 10:15 am CST and asked about when he would get the contract
and letter they had discussed on Thursday (Exhibit 45). Sepsey said nothing in the email about
having spoken to Kautzman and, contrary to Pugliano’s statement earlier that morning to Stemm,
Sepsey was still expecting the contract and letter that would require TMS to send in approval
information.
51. Kautzman testified that she had a 5 minute conversation with Sepsey and resolved
the problem and there was no reason to send a new contract. She testified that Sepsey agreed that
Stemm could email information directly to Direct HR without a TMS employee in the middle.
But she did not communicate this to Stemm. The court finds Kautzman’s testimony was not
credible that she had resolved the problem Friday morning, given that Sepsey was still waiting
for the contract and letter from TMS.
52. Reasonably believing that the situation was not yet fully resolved, Stemm called
TMS at 10:24 a.m. CST, and asked for Kautzman. When told she was unavailable he asked to
speak to the CEO, Dourgarian. Dourgarian indicated that he had no knowledge of Stemm’s
account, even though he had been copied on all the emails about the Direct HR issue two days
before, but assured Stemm that he would find out and have someone contact him. Stemm asked
that Kautzman call because Stemm had been told that she had solved the problem. Dourgarian
told Stemm that Kautzman would call him within 30 minutes. Dourgarian testified that this
conversation with Stemm was cordial. Dougarian emailed Kautzman and Pugliano a few minutes
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later at 11:08 am CST to “Please figure out what to do with Dave Stemm as he’s calling and
harassing me.” (Exhibit 46 at 3854). He did not provide any direction on how to resolve the
problem or tell Kautzman to call Stemm.
53. Kautzman did not call back. At 10:37 am CST Kraus called Stemm and said that
“TMS was trying to get you taken care of but you calling Mike Sepsey is not making things
easier.” Stemm didn’t remember Kraus and told Kraus he only wanted to speak to the COO,
Kautzman. Kraus testified that he knew nothing about the workers’ compensation problem or
about Stemm needing to place people the following week, and he did not discuss those issues.
He only called because he had been told that Stemm was calling TMS. The court does not find
Kraus’ testimony that he knew nothing of the workers’ compensation problem credible because
he had participated in the email chain the day before and complained about the proposed
resolution.
54. A few minutes later, around 11:00 am CST on Friday, Stemm insisted that
Kautzman be interrupted. Kautzman said “According to what I’ve been told, TMS was waiting
on Mike Sepsey.” She did not tell Stemm that she had resolved the problem. Stemm told her that
this directly contradicted what he had been told by both Pugliano and Sepsey, and suggested that
Sepsey be included in a conference call so they all could understand exactly what was needed to
resolve the workers’ compensation issue. Kautzman refused, told Stemm that she had people in
her office, and hung up the phone. Kautzman then asked to have Stemm’s calls sent to her
voicemail.
55. Stemm immediately asked to speak to Dourgarian again. Stemm was told that he
wasn’t answering his phone, and Stemm was connected to Kautzman’s voicemail instead. A few
minutes later at 11:41 am CST., Stemm called to get Dourgarian’s email address.
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56. After speaking with Stemm once on Friday, Dourgarian met with Kraus,
Pugliano, Brace and Kautzman to discuss Stemm. Although Dourgarian had told Stemm he
would figure out what was going on with the workers’ compensation issue, Dourgarian did not
discuss how to fix the workers’ compensation issue or the status of Stemm’s business. He only
recalls discussing what he referred to as the crescendo of increasingly unstable interactions with
Stemm and whether he fit their risk profile.
57. Dourgarian testified that he made the decision to terminate the contract. He
testified that calls from Stemm over the previous few days, especially on the morning of Friday
September 27, 2013, led him to believe that Stemm did not meet his risk management profile. He
especially noted that Stemm had demanded that Kautzman be pulled out of a meeting, even
though Stemm had been told that only Kautzman knew if the situation was resolved. He also
noted that Stemm made 9 phone calls to staff within a day or two, even though TMS had not
provided the workers’ compensation assurances 180 Personnel needed to start working the next
week. Dourgarian also testified that he was concerned that Stemm had called Mike Sepsey
directly, which he perceived as a failure to follow instructions. Instead of solving the problem
with the workers’ compensation, Dourgarian declared that Stemm was unstable and TMS was
not going to work with him. He directed staff to terminate the contract.
58. Shortly after, on Friday, September 28, 2013 at 1:10 p.m. CST, Stemm received a
voicemail from Pugliano stating that at the direction of the CEO and COO, “due to
circumstances we are not moving forward with your company at this time.” Stemm called
Pugliano and asked what those circumstances were, but Pugliano said that he was not made
aware of them.
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59. Although Kautzman and other witnesses testified that there was no problem
getting workers’ compensation, the court finds at the time TMS terminated Stemm, TMS had not
worked out an arrangement with Mike Sepsey at Direct HR that would not involve TMS
incurring increased clerical costs, and had not worked out an alternative. The court finds that
getting workers’ compensation through some other source was possible but would have cost
TMS more than originally anticipated, or at least would have taken an effort to obtain.
60. TMS presented evidence that one reason it cancelled the contract was because a
few weeks before, Pattison spoke to Brace in a manner she found rude and bossy. Stemm
learned on September 12 that she was offended. He apologized to her and assured her that it
would not happen again. No evidence was presented that there was a repeat of this behavior.
The court finds that this interaction was not the real factor in TMS decision to terminate the
contract, because after this occurred TMS continued with the “on boarding” process approving
potential customers and workers.
61. There was no evidence that Stemm was told not to call Direct HR. He was
directed to send his information to them. More importantly there is no evidence that his contact
with Direct HR damaged any relationship with Tempworks. Indeed, Tempworks testified that
everything had been worked out with Direct HR.
62. The court does not find Dourgarian’s explanation of why he terminated the
contract reasonable or credible. Staff was concerned that getting workers’ compensation through
Direct HR would entail unanticipated clerical expense. Mr. Stemm’s questions to TMS staff
were reasonable. Dourgarian admitted that he was too busy for Mr. Stemm. The court finds that
Dougarian terminated Stemm because he did not want to have extra expenditures for workers’
compensation insurance and did not want to spend time resolving this problem.
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63. Stemm acted reasonably on behalf of Plaintiff LLC and there was no credible
evidence that Stemm was mentally unstable or that he or Plaintiff LLC was untrustworthy. TMS
failed to produce credible evidence that it was at risk if it performed the contract.
64. Since termination of the Agreement, the Plaintiff LLC has not done business in
any capacity. It has no current clients and has not placed a single temporary employee. It has
zero dollars of revenue.
65. After TMS terminated the contract, Stemm contacted at least three other vendors
to try to obtain employer of record services so he could start the business. He could find no
vendor who could provide one stop shopping. Although he could have used multiple vendors to
duplicate the TMS services, these were cost prohibitive because he did not have the credit to pay
for these services in advance. Stemm was unable to open the business near October 1, 2013.
66. Because Stemm could not start up shortly after October 1, he was not able to
retain Pattison.
67. Plaintiffs’ claimed reliance damages are for costs that were borne exclusively by
David Stemm as an individual; no amounts were paid from bank accounts belonging to the
Plaintiff LLC. Additionally, Plaintiffs have itemized costs for dog care and child care while
Stemm visited Indiana, which cannot be reasonably viewed as a business expense given that his
wife was at home.
68. Stemm testified that he anticipated making a profit of $180,000 a year but
presented no details to support that projection.
69. The court finds that although at the time the contract was terminated 180
Personnel had only a few placements lined up for the following week, given the success that
Stemm and Pattison had starting up the Employment Plus Healthcare division and given the
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relationships with the 5 major customers, 180 Personnel was likely to retain those customers and
duplicate the business that had recently been performed. Stemm testified credibly that 180
Personnel would charge these customers the same rates. However, he only specifically
mentioned 5 major customers that he and Pattison had spoken to which he credibly testified had
agreed to work with 180 Personnel. The court finds that there is insufficient evidence that other
customers would also come, particularly in light of the continued competition from the person
who had replaced Pattison at Employment Plus.
70. Testy testified on behalf of Plaintiffs’ damage claim. Testy testified that from
December 31, 2012 until June 2, 2013 Employment Plus billed four of these five major
customers 4,024 hours for $98,897 with a total payroll of $58,897. Evidence was not submitted
about the billable hours to the fifth customer Meridian. After the Employment Plus burden was
subtracted that left a profit of $32,295 over 23 weeks for the four major customers.
71. Testy testified that if the higher burden of 14.9% imposed by TMS contract had
been applied that would have resulted in a profit of $31,201 over 23 months. However, Testy
did not include the charge for workers’ compensation insurance. The court finds that the
appropriate additional charge for worker’s compensation would have been 0.26%, which
Kaufman testified was the typical charge for Assistants. Clerical would have been only 0.2%.
The court is using the Assistant figure because there was insufficient evidence how many
workers would have been at a clerical rate. There was no evidence that the proposed staffing
would have been for physicians or health workers which have a much higher workers’
compensation charge. Adding the additional .26% to the 14.9% contractual burden, the total
“TMS burden” should be 15.16%. Using this figure the “TMS burden” over 23 months on the 4
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customers would have been $8,929 and the profit would been $31,071. This is equivalent to an
average profit of about $1,350 per week.
72. The court finds that given the consistent billing history, there is sufficient
evidence that 180 Personnel could have maintained these four customers over the next two year
life of the contract. If the average profit of $1,350 is extrapolated over 2 years, 104 weeks, the
profit over two years at that rate would have been $140,400.
73. Plaintiffs argued that the appropriate way to measure damages was to assume that
Plaintiff LLC would have made all the money that the Healthcare division was making adjusted
for a slightly higher burden charged by TMS. Even if the court agreed that all the customers
would have come to 180 Personnel, which it does not, calculations provided by Testy are too
speculative to provide a reliable basis to calculate damages.
74. Testy assumed that 180 Personnel would bill 18,148 hours a year, even though in
2012 the Healthcare division billed only 13,473 hours the year before. He testified that the entire
Healthcare division billed 18,750 hours in 2010, 17,977 hours in 2011 and 13,473 hours in 2012.
To reach his projection Testy had taken 5 months of data from 2013 and extrapolated from that
an expectation of 22,391 hours for 2013 and then averaged that number with the prior three
years. But the court finds that too speculative to be of use in considering damages.
75. Testy also used the data from the four major customers to create an average gross
profit per hour of $7.75. He used that number multiplied by the 18,148 hours to conclude that
180 Personnel would have made $140,000 a year. But there was no testimony that such a figure
would be similar to customers other than the large four or five. And there was testimony that
rates and profit margins could vary widely. The court finds that this number is too speculative to
extrapolate to other customers.
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CONCLUSIONS OF LAW
1. Plaintiffs allege that Defendant Tempworks Mangement Services, Inc. breached
the contract that it entered into with Plaintiff David and Hiba Stemm, LLC, d/b/a 180 Personnel
by terminating the agreement on February 28, 2013. Defendant argues that the contract
provision at paragraph 11.3 gives TMS complete discretion to decide whether or not it wants to
go forward. Defendant argues that it bargained for this escape clause and it had a right to
exercise it. However, the court does not agree that paragraph 11.3 gives TMS an unfettered right
to simply walk away from a contract. Indeed the provision does not say that. Paragraph 11.3
lays out circumstances that would create an event of default. 1) something happens which “may
be reasonably expected to have a material adverse effect on Your [Plaintiff LLC] business
operations”; 2) something happens which “may be reasonably expected to have any material
adverse effect whatsoever upon the validity or enforceability of this Agreement”; 3) something
happens that “may be reasonably expected to have any material adverse impact upon any
security for the Obligations”; 4) something happens that “materially impairs the ability of You to
perform Your obligations” . . .or the ability of Tempworks to enforce the terms of the agreement.
Importantly, the contract does not state that Tempworks can walk away whenever it wants but
limits the circumstances that would allow Tempworks to cancel the contract. The language
requires that something happens that is both material and reasonably expected to cause harm in
the ways set forth in the contract.
2. Tempworks stated that because Stemm made 9 urgent phone calls to inquire about
the workers’ compensation that Defendant had contractually committed to provide, the CEO
allegedly concluded that Stemm was mentally unstable and not a good risk. Even if the court
had found this a credible explanation for terminating the contract, which it does not, Defendant
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provided insufficient evidence as to how this behavior fell within one of the identified reasons to
call an Event of Default under paragraph 11.3. There was no evidence that this conduct would
affect 180 Personnel’s business operations, or that it would materially affect the validity or
enforceability of the Agreement, or of the security, which were the personal guarantees from
David and Hiba Stemm. Nor was there any evidence that these actions would impair the ability
of 180 Personnel to perform its obligations under the agreement. The testimony from
Defendant’s witnesses was vague and at best expressed an unease with Mr. Stemm. But unease is
insufficient. To rise to the level of an Event of Default, the contract language itself requires that
the problem must reasonably be expected to lead to a material adverse result. The court finds
Defendant did not have a reasonable basis to call an Event of Default under the contract.
3. Defendant argues that the words “Tempworks determines” in paragraph 11.3
means that Defendant has complete discretion to decide if it wants to go forward with a contract
and that this decision cannot be reviewed. The court disagrees. Although Tempworks bargained
for the use of discretion, Minnesota law implies a covenant of good faith and fair dealing into
every contract.1
“The term “acceptance” in an enforceable bilateral contract “cannot mean
privilege to repudiate solely on whim, but excuse for non-performance to be exercised in good
faith and honest judgment.” 2
The court in White Stone Partners explained that when a bargain is
reached there is implicitly an expectation that both sides will act to allow the contract to go
forward.
Without an implied covenant of good faith, an agreement vesting complete discretion to
invoke an escape clause in one party may be illusory. As the Eighth Circuit stated in
C.R.I., Inc. v. Watson, 608 F.2d 1137 (8th Cir.1979):
1
Minnwest Bank Cent. v. Flagship Properties LLC, 689 N.W.2d 295, 303 (Minn. Ct. App. 2004)
See White Stone Partners, LP v. Piper Jaffray Companies, Inc., 978 F. Supp. 878, 881 (D. Minn. 1997)
2
White Stone Partners, LP, 978 F. Supp. at 881 quoting CRI, Inc. v. Watson, 608 F.2d 1137, 1142 (8th Cir. 1979)
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[I]t is reasonable to assume the parties expected [the defendant] had committed himself to
“Something.” Moreover, a promise to act in good faith and reasonably in bringing the
condition about, in accepting or rejecting the ... proposal is necessarily implied.
Otherwise, [defendant's] promise would have been conditioned upon the future
happening of an event entirely within his control, and therefore illusory.
White Stone Partners, LP, 978 F. Supp. at 881.
4. Good faith and fair dealing at a minimum requires that parties do not act in bad
faith with an ulterior motive. Minnesota courts often look to a subjective standard. In other
words, courts will not necessarily find that someone violated their duty of good faith if they
make an honest mistake, even if negligent. Thus Minnesota courts often require that “to
establish a violation of this covenant, a party must establish bad faith by demonstrating that the
adverse party has an ulterior motive for its refusal to perform a contractual duty.” 3
Defendant
argues that Dourgarian honestly believed that Stemm was unstable and posed an undue business
risk and that because it was honest, even if unreasonable, that is not a breach of the covenant of
good faith. 4
3
Minnwest Bank Cent. 689 N.W.2d at 303 citing Sterling Capital Advisors, Inc. v. Herzog, 575 N.W.2d 121, 125
(Minn.App.1998).
4
The case law is divided on whether unreasonableness rather than ulterior motive violates the
covenant of good faith. See BP Products N. Am., Inc. v. Twin Cities Stores, Inc., 534 F. Supp.
2d 959, 965 (D. Minn. 2007) (“Unfortunately, on the other question-that is, the question of
whether conduct that is merely unreasonable can violate the covenant-Minnesota courts (and
federal courts applying Minnesota law) have not been entirely clear or consistent. As is discussed
below, though, the substantial weight of authority is that the covenant is breached only by
conduct that is dishonest or malicious or otherwise in subjective bad faith.”) Although this court
is persuaded that basic contract principles require that discretion be exercised in a manner that is
not arbitrary or irrational See Tymshare (the phrase “sole discretion” is not the necessarily
equivalent of ‘for any reason whatsoever, no matter how arbitrary and unreasonable), and would
find that Defendant’s view that Stemm was mentally unstable was irrational and an abuse of
discretion, the court’s decision rests on its finding of ulterior motive and bad faith rather than
lack of reasonableness.
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5. The court does not find Defendant’s explanation credible, Instead, the court
finds that Tempworks had an ulterior motive for terminating the contract. It did not want to
invest the time or money needed to resolve the workers’ compensation issue for Plaintiffs. TMS
had expressed no concerns about working with 180 Personnel or Stemm in the months
proceeding October 1. In the few days leading up to the October 1 start date, Tempworks
learned that Direct HR would require that Tempworks personnel send authorizations in. This
was a situation that Mr. Kraus referred to as a logistical nightmare. As of Friday morning, no
one had found an alternative, and Mr. Dougarian, the CEO, was not interested in working on a
solution or providing customer service. Instead he wanted to know why he was being “harassed”
by a customer who had contacted him about Tempworks’ failure to secure the workers’
compensation insurance they had promised to provide. Tempworks’ repeated emphasis on the 9
phone calls that Stemm made in two days, and his apparent audacity in asking that COO
Kaufman be interrupted once to answer a question, indicated to the court that Timeworks’
personnel were very upset at having their routines interrupted. The court finds that Tempworks
canceled the contract not because of any risk to the company but because they believed it would
be inconvenient and possibly more expensive to perform, and incorrectly believed that it could
simply step away from a contract that it no longer liked.
6. The court finds that Defendant anticipatorily breached the contract.5
On
September 28, 2013 Defendant announced that it would no longer move forward with the
5
Space Ctr., Inc. v. 451 Corp., 298 N.W.2d 443, 450 (Minn. 1980) (“(W)here one party to an executory contract,
before the performance is due, expressly renounces the same and gives notice that he will not perform it, his
adversary, if he so elects, may treat the renouncement as a breach of the contract and at once bring an action for
damages. * * *. (T)he refusal to perform must in effect be an unqualified renunciation or repudiation of the contract.
A mere refusal, not of that character, will not obviate the necessity of a tender.”)
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contract, in other words, Defendant made it clear that it did not intend to perform its end of the
contract.6
7. Although Plaintiff LLC was a startup company, the court finds that there was
evidence that was not too speculative upon which a damage award can be reasonably based.
Stemm and Testy testified credibly that sales of the large 5 customers had been steady since
2010, and the court finds it credible that these customers would have followed Pattison. Stemm
and Pattison had the knowledge and experience to run a successful company. It is reasonable to
assume that they could have brought in the same business from the 5 customers that they had
spoken to and secured. Since they would have charged the same rates, the payroll would have
been the same. The only difference would have been the burden which was set forth in the
Tempworks contract of 14.9% and the additional cost of workers compensation which can be
reasonably estimated to be .26%.
8. The court finds that if the contract had continued, Plaintiff LLC could reasonably
have expected to make a profit of $140,400 over two years, which was the life of the contract.
Any amount above that is too speculative. However, if the business had continued Pattison
would have been paid. Given that no information about the agreement with Stemm was
provided, the court looks to the Stemm’s statement that he viewed Pattison as an informal
6
Defendant argues that its refusal to perform was not technically an anticipatory breach because it was not
“unqualified”. Defendant contends that relying on the escape clause in paragraph 11.3 was a qualification that
prevents an anticipatory breach. The court disagrees. Qualification does not mean having a reason. An unqualified
revocation in one that is unconditional, i.e., there is no circumstance that would allow the contract to proceed. A
qualified refusal to proceed is one that could proceed but for an obstacle. See Credit Suisse Lending Trust (USA) 2
v. Phoenix Life Ins. Co., No. 11-CV-054-LM, 2011 WL 3665444, at *6 (D.N.H. Aug. 22, 2011) (Defendant did not
say it would never perform but needed permission from the court). Here Defendant made it clear it would not
perform under any circumstances; this was an unqualified renunciation. However, even if relying on another’s
default could be considered a qualification, the court has already found that this reliance was misplaced.
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partner, and as such assumes that Pattison would have been paid 50% of the revenue. Since
Plaintiff LLC saved that expenditure, its actual damage is $70,200.
9. The court finds that because of the breach Plaintiff LLC also lost the value of the
website and should be reimbursed the $4,100 that was paid for that.
10. The court finds that Plaintiff LLC did not fail to mitigate damages.
11. Defendant argues that there could be no damages because it had no obligation to
any temporary worker and no workers had been approved. However, the court rejects this
argument as well. Rejections would have to be reasonable and there was nothing in the record to
suggest that there would have been any reason to reject temporary workers for these 5 ongoing
clients.
12. Stemm is entitled to no damages for the money he spent because he personally
had no contract and no promise from Defendant. He also does not qualify to recover damages as
a promoter, because Plaintiff LLC was in existence at the time Stemm incurred the costs
personally. Stemm’s reliance on Incompass IT, Inc. v. XO Communications Services, Inc., to
find standing for an individual as a promoter is not applicable. In Incompass, the plaintiffs were
not individuals but corporations. Defendant had an alleged oral contract with one company
Passageway to lease space. That company was succeeded by another HLI. 7
The court rejected
the defendant’s argument that the successor had no standing because the “promise” was made to
the first company and no promise was made to the second. The Court held that there was no
fundamental difference between the first “promise” company Passageway and its successor HLI
and that the promise was made to individuals who were acting on behalf of both companies.8
The case is not analogous to Stemm’s situation and does not provide support for his contention
7
There were actually two plaintiffs InCompass and HLI because the successor HLI was related to the other
InCompass.
8
2012 WL 28267 (D. Minn. Jan. 5, 2012)
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that promises made to him while a corporation was in existence should allow for personal
standing. InCompass did not allow any individuals to have standing. And the facts are
distinctly different. InCompass addresses the relationship between a predecessor and a
successor, but that relationship does not exist here. The promise in Stemm’s case was made
when the corporation existed so there is no “successor” relationship. Stemm’s reliance on State
v. Indus Tool and Die Works9
for the premise of promoter standing is also misplaced: in that
case, two individuals purchased a business as a partnership and later formed a corporation; the
Court found that the individuals in the partnership remained liable for the obligations of the
business after forming the corporation. Even if cases allowing promoter liability also allow for
promoter standing, the principal does not apply if the rights and obligations were only incurred
after the formation of the corporation.10
In Stemm’s situation the corporation was formed before
reliance damages were ever incurred, and Stemm does not have standing as a promoter.
13. Plaintiffs claims for promissory estoppel are dismissed. Plaintiff LLC has a
contract and has rights under that which bar an additional claim for promissory estoppel. No
promises were made to Stemm as an individual, all were made to him in his capacity as
representative of the LLC.
9
21 N.W.2d 31 (Minn. 1946)
10
Stemm also cites to Ehlen v. Johnson, 1997 WL 769534*2 (Minn. Ct. App. Dec 16, 1997) for the premise that an
individual promoter can have the rights (and obligations) of a corporation. But Ehlen is distinguishable in an
important respect: promotor liability for the corporation was only an issue because the corporation was never
formed. In this case, as noted, the Plaintiff LLC was formed before any reliance damages were incurred by Stemm.
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ORDER
1. Plaintiff David and Hiba Stemm, LLC is hereby Granted a Judgment against
Defendant Tempworks Management Services, Inc. for a total amount of $74,300.
2. Plaintiff James David Stemm’s claims for individual reliance damages are Denied.
Let Judgment Be Entered Accordingly.
DATED: ________________
BY THE COURT:
____________________________________
The Honorable Kristin A. Siegesmund
Judge of District Court
Siegesmund, Kristin
2015.02.17 16:42:20 -06'00'
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