Thursday, April 18, 2013

Business Workshop: New Place For State Contract Disputes

Chad I. Michaelson, Esquire
A recent Commonwealth Court decision enables contractors to take their disputes with Pennsylvania's state government before a venue other than the Pennsylvania Board of Claims -- but only if no money is at stake.

For years, the precedent was that the Board of Claims served as the exclusive venue for contractual claims against the commonwealth.

In the case in question, a company responded to a state request for proposal -- or RFP -- won the competition, and signed a contract with the Department of General Services.

The incumbent contractor filed a protest based on the fact that a minor math mistake had been made in scoring the RFP responses. Although the mistake did not change the results of the RFP process, the Department of General Services cancelled the RFP and the contract.

The company that lost the contract through the cancelation filed a complaint with the Commonwealth Court. Department of General Services and the incumbent contractor argued that the matter could only be heard before the Board of Claims, and that the contract cancellation could not be challenged until the disgruntled contractor had filed a claim with DGS.

The Commonwealth Court disagreed, citing an obscure 2002 amendment to the Board of Claims Act which allows parties to seek nonmonetary relief "in another forum as provided by law." The court held that because the contractor was seeking to prevent DGS from cancelling the contract and not a payment of money, the court had the jurisdiction to resolve the dispute.

The decision means that contractors are not necessarily required to go before the Board of Claims in disputes related to Pennsylvania state contracts, but may be able to go directly to a court. The catch is that the claim cannot ask for monetary relief. If asking for money, the contractor will still have to take its case before the Board of Claims.

For more information on this topic, please contact Chad Michaelson at

This article originally appeared in the Pittsburgh Post-Gazette's Business Workshop section.  Business workshop is a weekly feature from local experts offering tidbits on matters affecting business.  Read more:

Wednesday, April 17, 2013

Business Workshop: Second Buyers Can Sue Homebuilders

Kevin F. McKeegan, Esquire
A recent Pennsylvania Superior Court decision has increased the risk of lawsuits by homebuyers against builders -- not only can the first buyer of a new home bring a lawsuit against a builder, but now any subsequent buyer within 12 years of the home's construction can file a claim.

In the case in question, a builder constructed a home in Jamison, Bucks County. After living in the home a few years, the first buyers sold it to a family who discovered water infiltration around the windows in the master bedroom.

The second buyers filed a complaint against the builder alleging only one count: breach of the "implied warranty of habitability," which is the guarantee that the home is habitable.

The Superior Court held that the implied warranty of habitability should not end when the first buyer sells the property, and held that the risk of a hidden defect should continue with the builder for the full 12 years stipulated under Pennsylvania law.

The plaintiffs were thus permitted to continue their lawsuit against the builder.

The court explained that liability is still limited by two factors. First, homeowners must file the claim within 12 years from the time of the completion of the construction. Second, the breach of the implied warranty must still be proven. The homeowner must show that a defect is hidden and non-obvious, that it is a result of the builder's design or construction, and that it affects the habitability of the residence.

Builders should be aware of this change in the law and realize that latent defects may now subject them to liability up to 12 years after the construction is complete, no matter how many times the house is sold.

For more information on this topic, please contact Kevin McKeegan at

This article originally appeared in the Pittsburgh Post-Gazette's Business Workshop section. Business workshop is a weekly feature from local experts offering tidbits on matters affecting business. Read more:

Tuesday, April 16, 2013

Business Workshop: Noncompetes and Fired Employees

Brian J. Sommer, Esquire
For decades the conventional wisdom has been that if you fire an employee, you can't enforce any noncompete agreement that the employee signed with the company.
The argument goes that by firing an employee, the company deems that employee's contribution worthless to the business. The employer therefore has little or no need to protect itself from the possibility of the fired employee taking business away or otherwise harming the company.
But recent court decisions are changing that view. Nowadays the fact that an employee was fired without reason may not, in and of itself, invalidate a noncompete covenant. The fact of the firing is one of several factors courts will consider in determining if the noncompete clause is valid.
Other factors include:
  • The fired employee's access to the company's confidential and proprietary information.
  • The fired employee's past agreement to terms that prevent him from soliciting the business of the company's clients.
  • If the employee has revealed any confidential information or trade secrets.
  • If the employee received a consideration such as a promotion or payment for signing the noncompete agreement.
  • The impact of the noncompete covenant on the former employee's ability to earn a living.
  • The question of enforcing the noncompete contract of a fired employee is moot, however, if the company has not constructed the contract terms properly. The restrictions imposed by a noncompete clause must be reasonably necessary for the protection of the employer. Moreover, the noncompete restrictions must also have reasonable limitations in both how long they last and geographic scope.

For more information on this topic, please contact Brian J. Sommer at

This article originally appeared in the Pittsburgh Post-Gazette's Business Workshop section. Business workshop is a weekly feature from local experts offering tidbits on matters affecting business. Read more:

Monday, April 15, 2013

Inappropriate Interview Questions Can Lead to Discrimination Lawsuits

Elaina Smiley, Esquire
Rejected job applicants often want to know the reason why they don’t get a position for which they interviewed.  If an interviewer asked inappropriate questions during the interview, it may lead an applicant to believe that illegal discrimination played a part in the interviewer’s decision not to hire him or her.

Certain subjects can be a minefield for discrimination lawsuits, so interviewers must be trained to walk a fine line when discussing these subjects and only ask questions as they pertain directly to the job.

Please click here to read Elaina's full article and to learn some of the most problematic questions for employers.

This article originally appeared in the February 2013 issue of Western Pennsylvania Healthcare News.

For more information on this topic, please contact Elaina Smiley at

Friday, April 12, 2013

Business Workshop: Self-Employed Can't Get Unemployment

Beth A. Slagle, Esquire
People laid off from jobs who work even a few hours on the side as an independent contractor may be putting their unemployment benefits in jeopardy.

Under Pennsylvania law, individuals receiving unemployment compensation benefits are permitted to work as employees and have what they earn offset their unemployment compensation. But, the Pennsylvania unemployment compensation law mandates that individuals who are self-employed are not eligible for unemployment compensation.

A recent line of Pennsylvania appellate cases suggests that taking some side jobs while a claimant is engaged in seeking full-time employment will not automatically disqualify claimant from receiving an unemployment check.

"Self-employment" is not defined in Pennsylvania unemployment compensation law, so courts have looked to the law's definition of "employment" for guidance. Under Pennsylvania law, a person is employed unless: 1) the individual is free from control or direction of an employer; and 2) the individual is providing services and is "customarily engaged in an independently established trade, occupation, profession or business."

The recent court decisions have placed emphasis on the second characteristic -- whether the individual is "customarily engaged" in a business. If the income is sporadic or temporary, courts are more inclined to rule that the individual is not customarily engaged in business, so that they can continue receiving benefits. If, however, the individual is trying to make a living with a recently started business, instead of simply using it as a side activity, then the courts take a much harsher view, regardless of whether the individual has generated any income.

The bottom line is that individuals seeking to open a new business after being laid off should consider if their activities will disqualify them from receiving unemployment compensation.

For more information on this topic, please contact Beth A. Slagle at

This article originally appeared in the Pittsburgh Post-Gazette's Business Workshop section. Business workshop is a weekly feature from local experts offering tidbits on matters affecting business. Read more:

Thursday, April 11, 2013

Wednesday, April 10, 2013

Business Forum: Immigration Expansion Should Cover the Gamut of Income Levels

Joel Pfeffer, Esquire
One detail on which all sides of the immigration debate seem to agree is the need to increase immigration quotas for the highly skilled, highly trained workers, so that more of these workers can enter the country. But a new immigration policy that does not adjust the quotas for workers along the entire wage and skill spectrum is doomed to fail.

As the Obama administration and members of Congress submit their proposals for immigration reform, one only hopes that in the course of the discussion, Congress, the president and the stakeholder community do not lose sight of the ultimate goal, which is reducing illegal entry and overstays of legal entrants. What to do about the estimated millions of illegal aliens already in the United States has, for practical purposes, stood in the way of badly needed immigration reform.

The various proposals discourage illegal immigration in several ways. For example, the president wants to establish mandatory verification by all employers to confirm employment authorization for new employees through the government database, E-Verify. Currently only certain employers are required to use E-Verify.

All the proposals call for increased border security and dedication of additional funds to secure the border. Finally, most proposals streamline the deportation of overstays who are threats to public safety. Congress will debate the effectiveness of these policies, and will enact some form of punishment and deterrent to illegal entry and overstay.

But if the goal is to prevent another illegal surge, our immigration policy must include a combination of reward and punishment. Comprehensive immigration reform will only be effective if there are legal opportunities for unskilled, semiskilled and highly skilled workers. Otherwise, the United States will continue to be a magnet for illegal entry and overstay.

The president has proposed increasing the quotas to eliminate the backlog for employment-sponsored immigration. The quotas were last overhauled in 1986. Under current quotas, most sponsored employees -- even professionals -- wait six years from the time an employer can establish a shortage of U.S. workers for the position until the employee is allowed to fill the position. Six years is simply too long for both the employer and the employee.

Streamlining the process for highly skilled immigrants, those with so-called "world class" skills, is an easy political sell. But reform needs to be across the board. The United States must offer realistic immigration opportunities at all levels, if another illegal immigration crisis is to be avoided.

Once we offer immigrants reasonable opportunities to immigrate to the United States, we can realistically expect that punishments imposed on those who fail to obey our laws will serve as effective deterrents.

Without a viable legal option, too many workers at all skill levels will be too tempted by the higher wages and greater opportunity in the United States. Without increased quotas at all levels, criminalizing unlawful status or taking other enforcement measures will simply create a revolving door of illegal aliens coming to the United States faster than we can deport those we find.

Whatever legislation is finally passed should reward aliens who follow our laws. The only reward that matters is to increase employment-based immigration visas and temporary guest worker visas. Otherwise, millions more will find illegal ways to enter the United States.

For more information on this topic, please contact Joel Pfeffer

This article originally appeared in the Pittsburgh Post-Gazette's Business Forum section. Read more:

Tuesday, April 9, 2013

401(k) Disclosure Documents, Pay Attention

Richard T. Kennedy, Esquire
A recently effective Department of Labor regulation has made it a little easier for businesses to make informed decisions in choosing the most cost-effective service providers for the administration of employee 401(k) retirement plans.

But employers should be warned that the new regulation puts them under higher scrutiny from the Department of Labor during an audit to make sure that they have made prudent decisions in hiring service providers to best administer their employees’ retirement plans.


This article was featured in the Pittsburgh Business Times.  Please click here to view the full article.

For more information on this topic, please contact Richard T. Kennedy at

Monday, April 8, 2013

Making E-Discovery As Low-Cost As Possible

David G. Oberdick, Esquire
Consider the number of emails, documents, instant messages, texts, and other electronic data a company uses each day.

If a company later finds itself in a lawsuit, all or some portion of that information can become evidence in the case. During the “e-discovery” phase, attorneys and professional technology experts may have to sift through all the data, potentially leading to astronomical costs. A business that fails to properly preserve and organize the information can face serious court fines, or even worse, an adverse finding or verdict.

This article was featured in the Pittsburgh Business Times.  Please click here to view the full article.

For more information on this topic, please contact David G. Oberdick at

Friday, April 5, 2013

Business Workshop: Employing Foreign Workers in 2013

Joel Pfeffer, Esquire
The large turnout of Hispanic voters in the 2012 election will likely influence Congress to begin again to discuss U.S. immigration policies and reform.

Whatever a new immigration law looks like, it will likely affect most employers. For example, businesses can expect any new immigration law to include greater penalties for those employers who hire undocumented immigrants.

Even if no new immigration law is passed, the Immigration and Customs Enforcement agency (ICE) will likely ratchet up audits -- 2012 set a record for ICE compliance audits of U.S. companies and 2013 will most certainly see a continuation of that trend.

ICE audits company payroll records and the I-9 forms that employers must fill out and document for new hires. Employers should make certain that they have completed I-9 forms for all employees.

Employers should also expect an expansion of E-Verify in 2013. Now voluntary, E-Verify is a government database used by employers to see if a new employee is legally authorized to work in the U.S. Over the years, Congress has tried to encourage the use of E-Verify -- for example, foreign students who graduate with science, technology, engineering or mathematics degrees may not extend post-graduation employment unless their employer have run their names through E-Verify.

Another trend that will likely continue with or without a new immigration reform law is the high demand for H-1B visas.

The H-1B visa program permits companies to employ foreign professionals for up to six years. Only 85,000 H-1B visas are awarded each year and demand has been increasing in each of the last several years. Employers can file as early as April 1 for employment beginning Oct. 1, the first day of the government's fiscal year. Companies that employ H-1B foreign workers should file as early as possible in 2013.

For more information on this topic, please contact Joel Pfeffer at

This article originally appeared in the Pittsburgh Post-Gazette's Business Workshop section.  Business workshop is a weekly feature from local experts offering tidbits on matters affecting business.  Read more:

Thursday, April 4, 2013

Workplace Violence A Growning Problem in Healthcare Industry

Beth A. Slagle, Esquire
Healthcare professionals are among those workers with the highest risk of experiencing violence in the workplace.  A 2010 report from the U.S. Bureau of Labor Statistics showed that 60% of all workplace assaults occurred in a health care setting, nearly three quarters of which were by patients or residents.
Nurses who work in emergency rooms, psychiatric wards and home health care settings are at the highest risk of assault.  A November 2011 survey from the Emergency Nurses Association showed that nearly 13 percent of nurses experienced physical violence in a one-week time period, and more than half reported verbal abuse.  Healthcare employers must therefore be extra vigilant about protecting their staff from violence. 

This article originally appeared in the March 2013 issue of Western Pennsylvania Healthcare News.  Please click here to read Beth's full article and to learn more about workplace violence in the healthcare industry.

For more information on this topic, please contact Beth Slagle at

Tuesday, April 2, 2013

Women in Business: Climbing the Corporate Ladder

Patricia Dodge Featured in Pittsburgh Business Times
Patricia L. Dodge, Esquire
When Patricia Dodge graduated from Duquesne University School of Law in 1981, a female managing partner at a law firm was practically an anomaly.
“I remember graduating and almost believing that I probably wouldn’t end up in a leadership position because, at that time, I couldn’t see any other women that were doing it,” she said.
Please click here to go to the Pittsburgh Business Times website to view the full article.