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ERISA Guide by Pivotal Attorney McKean Evans Published in WSAJ Trial News

Posted Wednesday, October 10, 2018 by Pivotal Law Group

Attorney McKean J. Evans published a guide to handling insurance claims under the Employee Retirement Income Security Act (“ERISA”) in the October edition of the Washington State Association for Justice Trial News.

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Seattle's Domestic Workers Bill of Rights

Posted Tuesday, September 25, 2018 by Pivotal Law Group

Are domestic workers like nannies, gardeners and housekeepers entitled to basic worker protections like breaks and minimum wages? The answer used to be no, but under Seattle’s new Domestic Worker Bill of Rights, domestic workers have new and important legal rights with which employers must comply.

On July 27th, 2018, Seattle Mayor Jenny Durkan signed Ordinance 125627, the Domestic Workers Bill of Rights, establishing new rights and protections for domestic workers. The Ordinance generally does three things: (1) imposes a minimum wage for domestic workers; (2) requires regular breaks for domestic workers; and (3) adds miscellaneous additional protections aimed at curbing some reported abuses of domestic workers that are common in the industry. However, the Ordinance is complex and the devil is in the details.

The Domestic Workers Bill of Rights has its background in the lack of existing legal protections for domestic workers. The mayor’s office noted:

For more than 80 years, domestic workers have been exempted from federal laws that allow workers the legal right to join in union to demand better working conditions. That exclusion has historically led to the exploitation of these workers who are mostly immigrant and mostly women of color. Many domestic employees are covered by federal, state, and municipal laws on minimum wage and overtime but don’t know their rights. They fear retaliation and loss of employment for speaking out. According to the Seattle Domestic Workers Association estimates there are at least 30,000 domestic workers within city limits.

The activist organization Working Washington lauded the Domestic Workers Bill of Rights as “a groundbreaking step forward for nannies and housecleaners.”
In practice, the Domestic Workers Bill of Rights imposes three important new requirements on employers of domestic workers:

1. Minimum wage. Domestic workers are now entitled to a minimum wage. Calculating the specific minimum wage is complex because the specific hourly minimum wage takes into account whether the worker receives health insurance benefits and also accounts for the size of the employer. For example, a domestic worker employed by an employer with less than 500 employees in 2018 is entitled to $14.00 per hour if they receive no health insurance. These wage amounts increase annually.
2. Rest and Meal Breaks. Domestic workers are now entitled to regular rest and meal breaks. Again, the specific rights involved depend on the details of the job. Generally, domestic workers are entitled to a 30-minute uninterrupted meal break for every 5 hours worked; the break is with pay unless the nanny is “on call” during the break. Domestic workers must also receive a 10-minute paid rest break every four hours worked, or a 10-minute unpaid uninterrupted rest break every three hours worked. In the event the worker’s duties prevent them from taking these breaks, the worker must receive additional compensation for the missed break. Domestic workers residing at the place of employment must receive an unpaid day off for every six consecutive days worked.
3. Additional Rights. The Domestic Workers Bill of Rights also aims to curb some of the abuses to which domestic workers have been subjected. Among other things, employers may not keep the domestic workers original documents or personal effects (aimed at correcting practices where, for instance, domestic workers’ immigration papers are held hostage by the employer to keep the worker from reporting abusive labor practices to the authorities).

Domestic workers whose rights are violated have the right to file a lawsuit to recover double their lost pay, attorneys’ fees, and a $5,000 penalty for violations of the new law.

The law also includes an important protection for individuals hiring domestic workers through an agency: in such a relationship, the agency and not the individual is exclusively responsible for ensuring compliance with the Domestic Workers Bill of Rights.

Pivotal Law Group Attorney McKean Evans advises both workers and employers regarding their legal rights. If you have questions about Seattle’s Domestic Workers Bill of Rights or other employment law concerns, contact McKean for a free consultation.

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Inverse Condemnation Claims – Sound Transit

Posted Thursday, September 20, 2018 by Christopher L. Thayer

Division II of the Washington Court of Appeals recently addressed a situation where a landowner asserted an inverse condemnation claim against Sound Transit and the City of Tacoma for flood damage which plaintiff claimed was caused by the negligence of Sound Transit and the City of Tacoma. * See, Ruth v. Sound Transit and City of Tacoma*, No. 50458-8-II (September 11, 2018). This is an unpublished decision, but provides a nice primer on the law of inverse condemnation in Washington.

Article I, section 16 of the Washington Constitution limits the State’s inherent power of eminent domain by requiring the government to pay reasonable compensation for taking or damaging private property for public use. Phillips v. King County, 136 Wn.2d 946 (1998).

Inverse condemnation is an action instituted by a landowner “to recover the value of property which has been appropriated in fact, but with no formal exercise of the power of eminent domain.” Id., at 957. The elements of an inverse condemnation claim are (1) a taking or damaging (2) of private property (3) for public use (4) without just compensation (5) by a governmental entity that has not instituted formal eminent domain proceedings. Id. Under such circumstances, a private land owner may sue the appropriate governmental entity seeking compensation for their loss of their property or the damages to the property.

With regard to the first element, a taking or damaging occurs when the government invades or interferes with the use and enjoyment of a person’s property, causing the property to decline in market value. Martin v. Port of Seattle, 64 Wn. 2d 309 (1964). A landowner alleging an inverse condemnation must show more than a tortious interference with the use or enjoyment of his property. Borden v. City of Olympia, 113 Wn. App. 359 (2002). Flooding can provide the bases for an inverse condemnation as an “invasion” of property if the invasion is “permanent or recurring” or involves “‘a chronic and unreasonable pattern of behavior by the government.’” Gaines v. Pierce County, 66 Wn. App. 715 (1992).

More specifically, a municipality may not collect surface water by artificial means, channel the water, and deposit it on private property, thereby causing damage, unless the municipality compensates the owner. Wilber Dev. Corp. v. Les Rowland Constr., Inc., 83 Wn.2d 871 (1974).

An inverse condemnation claim may be proven by (1) the “diversion of waters from the direction in which they would naturally flow and onto the land of plaintiff” or (2) where “the amount of water has been increased.” Id. The measure of damages in an inverse condemnation case is the diminution in the fair market value of the property caused by the governmental taking or damage to the property. Peterson v. Port of Seattle, 94 Wn. 2d 479 (1980).

In Ruth, the Court of Appeals noted plaintiff had not retained an expert to testify about the issue of damages or the diminution in value to the property. Without this, and based on some other procedural issues (including lapse of the applicable statute of limitations), the Court of Appeals affirmed the trial court’s dismissal of plaintiff’s case.

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The Importance of Planning for Medical and End-of-Life Decisions

Posted Wednesday, September 12, 2018 by Pivotal Law Group

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People make an estate plan because they want certainty about what will happen in the future. This often includes certainty about who will make medical decisions for you if you’re ever unable to do so. For many people, one important future medical decision is so-called “end-of-life” planning. This means exercising control over medical treatment and decision-making in a terminal illness or similar condition. Some people express a desire to go off life support or decline life-sustaining medical care because they don’t want to artificially prolong the process of their dying. Others just want a firm plan for who will make those decisions to give themselves and their family certainty.

People have a right to make end-of-life plans. Medical ethical principles give patients an absolute right to decide what medical treatment to undergo, including the right to refuse medical treatment. That includes designating someone else to decide to refuse medical treatment on your behalf if you’re incapacitated.

But this generates a conflict with health care providers, who always want to do everything they can to keep patients alive as long as possible regardless of the patient’s awareness or quality of life. When decisions are being made that are, quite literally, life-and-death, medical providers want to be certain they are following the patient’s wishes. It doesn’t matter how forceful your wishes are, or how strongly your trusted decision maker advocates for you, if you haven’t planned for these decisions in a way healthcare providers and the law will recognize.

Washington law gives people the right to plan for this as part of their estate plan. You can express your wishes in advance with a Health Care Directive. Washington’s Natural Death Act permits individuals to issue an advance Health Care Directive describing the individual’s desire for medical providers to withhold or withdraw life-sustaining treatment. A Health Care Directive becomes effective only if the person is certified by doctors to be in a “terminal condition” or “permanent unconscious condition.” In such event, the Health Care Directive expresses the person’s desire that their dying not be prolonged by artificially provided nutrition and hydration. The directive has specific formal requirements including being witnessed by two disinterested persons.

Washington law also gives you the right to designate an agent to make health care decisions on your behalf in the event you’re incapacitated through a Power of Attorney. A Power of Attorney is a formal document granting a third party authority to make decisions on your behalf if you cannot do so. A Power of Attorney providing a trusted agent authority to make medical decisions on your behalf under specific circumstances can give you some certainty that future medical decisions, including end-of-life planning, are made in accordance with your wishes.

The tension between end of life planning and health care providers, and the need for a specific and effective medical decision-making plan, were highlighted in a recent high-profile Oregon case where the patient’s husband accused her doctors of ignoring her wishes for medical treatment. There, doctors continued providing artificial nutrition to the patient despite her wishes in her advanced directive, because the doctors believed the patient’s advance directive was not specific enough under the circumstances. Cases such as this one underscore the need for careful advance planning of your future and end-of-life medical wishes.

If you have questions regarding planning for future medical decision-making, contact Attorney McKean J. Evans for a free consultation.

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Five Important Things You Should Have in Your LLC Operating Agreement

Posted Wednesday, September 5, 2018 by Kim Sandher

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While most states don’t require you to have an operating agreement (Washington is the one of the states that does not require it), one of the biggest mistakes people make after setting up a Limited Liability Company is not drafting an operating agreement. I’ve had many clients come to me after things have fallen apart and they don’t have anything in writing to resolve their issues and a lot of them end up in expensive litigation trying to resolve the problem. As you probably know, litigation can be very expensive. It’s good to address things you don’t want to think about and that are not at the top of your list when launching your business.

An operating agreement is the document that lays out the rules and understanding among the members of the LLC. It is like what the bylaws for a corporation are.

These are five important things you should consider putting in yours:

1. Ownership Interests: Usually ownership is based on how much each owner contributed when the company was started, but it’s still possible to split other ways. A lot of people make other arrangements. For example, an owner might get 30% of the company even though he or she only contributed 10% of the money to the company because they bring more experience, or will be bringing in more sales, or will be the only one running the business. Whatever the reason is, the operating agreement should clearly list out how much each owner interest is because it will affect important decisions for your company.

2. Management: The LLC can be managed by one or more members, by a board, or by one or more managers. Typically, management is responsible for the day-to-day running of the business and for strategic decisions. Your operating agreement should lay out how management is selected, what triggers removing or replacing management, what procedures should be followed, what powers management has, and any limitations to management.

3. Sharing of Profits and Losses:
Usually sharing in profits and losses is done according to the percentage owned. For example, if you own 30% of the company, you would get 30% of the profits and/or 30% of the losses. If a member is an individual, the amount they receive in profit or losses is typically what they’d report on their personal income tax. The percentages may be different than ownership interest because of tax considerations. It’s good to lay all of this out clearly in an agreement.

4. Member Changes: Laying out how a member may exit the business, sell their share, or what happens when a member dies will save you the hassle and stress of figuring it out when it does happen. You might want to give the remaining members the option to buy the exiting member’s share and lay out how the business will be valued. You may want to also address what happens when a member files for divorce or bankruptcy.

5. Dissolution:You should address the steps that should be taken to dissolve the LLC and how the assets should be divided and how debts should be paid.

Since this is one of the most important documents your business will have, it is always a good idea to have an attorney review your document even if you’ve drafted it yourself. Your lawyer will look it over to address any legal issues with the drafting and/or point out anything you may have missed. You should also keep this document updated to address any changes in the business.

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DISCLAIMER: This blog is not legal advice. This site and any information contained herein are intended for informational purposes only and should not be construed as legal advice under any circumstances, nor should it be construed as creating an attorney-client relationship. The information on this blog is a general statement of the law and may not be up to date, accurate or applicable to your specific circumstances. Prior success in litigation is not an indication of future results; each case is unique and past results cannot predict future outcomes.

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