Contract lawyer sues NYC law firm for not paying overtime
Jul 9th, 2010 | By mrposse | Category: Contract Attorney Market: Trends
A contract lawyer is suing Labaton Sucharow alleging that the law firm violated federal labor laws by not paying time-and-a-half for overtime. The contract lawyer, Moshe Koplowitz, said that Labaton Sucharow did not pay him at a higher rate when he worked more than 40 hours in a week. Koplowitz has been doing contract work for a number of years and is about 10 years out of law school. A review of the case from the New York Times can be found by clicking here. There are also some excellent comments to the article.
NYC Posse List members will remember Labaton Sucharow from the large Countrywide class action document review. Which is kind of interesting since Koplowitz’s suit seeks to become a class action.
We spoke with the lawyer who drafted the complaint, D. Maimon Kirschenbaum, who said that federal law required employees paid by the hour to receive one-and-a-half times their regular pay for every hour over 40 hours worked in a week. To read the complaint click here.
As we discussed with Kirschenbaum, the cases rests on whether document review constitutes the practice of law. Under Federal law it hinges on:
§ 541.304 Practice of law or medicine.
(a) The term “employee employed in a bona fide professional capacity” in section 13(a)(1) of the Act also shall mean: (1) Any employee who is the holder of a valid license or certificate permitting the practice of law or medicine or any of their branches and is actually engaged in the practice thereof;
Under state law it hinges on 12 NYCRR § 142-2.14 which reads as follows:
(iii) Professional. Work in a bona fide professional capacity means work by an individual:
(a) whose primary duty consists of the performance of work: requiring knowledge of an advanced type in a field of science or learning customarily acquired by a prolonged course of specialized intellectual instruction and study, as distinguished from a general academic education and from an apprenticeship, and from training in the performance of routine mental, manual or physical processes; or
original and creative in character in a recognized field of artistic endeavor (as opposed to work which can be produced by a person endowed with general manual or intellectual ability and training), and the result of which depends primarily on the invention, imagination or talent of the employee; and
(b) whose work requires the consistent exercise of discretion and judgment in its performance; or
(c) whose work is predominantly intellectual and varied in character (as opposed to routine mental, manual, mechanical or physical work) and is of such a character that the output produced or the result accomplished cannot be standardized in relation to a given period of time.
Tom the Temp has reported on this story and there is a stream of comments on his site that discuss the various issues that may or may not be involved in the case. For those comments click here.
This all reminds us of the Preston Gates & Ellis case (now K&L Gates LLP and yes — that’s Bill Gates father) where the firm agreed to settle a lawsuit alleging violations of the wage and hour laws. The suit was filed on behalf of over 300 lawyers who were employed by the firm to review electronic documents that were the subject of discovery requests in lawsuits. The gist of the case was that the law firm treated the lawyers as professionals who were exempt from the overtime laws as a result of their professional status, but the lawyers claimed that their work did not require them to use their professional skills, thereby making them nonexempt hourly workers. The settlement reportedly involved a payout of $700,000. The firm denied violating the law and told the media at the time that it would be easier and more cost-effective to settle the case than to fight it.
The reason that lawsuit was important is that it illustrated that even sophisticated employers can find themselves in a costly dispute over whether employees have been properly classified under federal and state wage and hour laws. The suit also illustrates that it is the actual work performed by employees that matters, not the amount of education or training that the employees have or the label that is placed on the work. The issues in the Preston Gates & Ellis case could arise in any workplace with exempt employees, even if they are not professionals. Misclassifying executive or administrative employees could have the same result.
Note to New York Posse List members: has anyone seen a citation, case or reference that New York law does not recognize document review as the practice of law? We know this is an issue for out-of-state lawyers trying to waive into New York. Let us know your experiences and if you can e email us a cite/reference: manager@theposselist.com.
So doesn’t this bring back the idea that its not the practice of law, so non-lawyers can do it? Thus supply and demand will push the hourly rate low and overtime becomes a moot point?
I loved the file photo, btw.
This is a great post, and it raises some interesting legal issues.
As a longtime (5+ years) doc reviewer in the NYC market, my assessment is that we’re akin to factory workers. We need a decent understanding of legal concepts and the case at hand, but what’s primarily required is stamina, discipline, and attention to detail. We need to make decisions quickly with a minimal error rate, akin to someone installing a windshield – I do not think our work is “varied in character.”
This story was also reported on the NYT city room blog earlier this week, and it generated some great comments. It’s worth checking out their story, but I’m not adept at links – I quickly found it using a Google search – if the Posse List editors could post the link that would be great.
One of the commentators had a similar concern to Gordon’s, that wage/hour violation lawsuits would incentivize clients to have more work done in India, where (presumably) there are no such laws, or at least they aren’t enforced, or the wage is so low that the employer is happy to pay OT.
Editors, please let us know what people are saying about NYS opinion re document review work as practice of law. I feel that we’re caught in a difficult spot: we maintain our licensure as attorneys, yet agencies/law firms determine seemingly at random whether they require admitted or non-admitted JDs. On a related issue, I find it ridiculous that we are conflicted out of jobs – shouldn’t non-disclosure agreements suffice?
There is also some excellent analysis in the comments to the NY Times article: http://sn.im/z6qiz
It’s high time somebody had the courage to push this. Kudos to Koplowitz!
@Gordon: Non-lawyers are already doing it. A recent foreign-language document review I know about included several reviewers with JDs who weren’t admitted in any U. S. jurisdiction, one reviewer with an undergraduate degree in law from a European university, and one reviewer who had a paralegal’s certificate but had never even worked as a paralegal. (The non-lawyers were paid $35/hr plus overtime. The lawyers got $50/hr and no overtime. But everybody was doing exactly the same work, and everybody had to work a 70-hour week.)
Obviously, employers and law firms aren’t concerned with professional standards, or even with avoiding the unauthorized practice of law, as long as they get the dough. I’d love to know what the client was billed for these non-lawyers’ work, and whether or not it was informed that non-lawyers were doing the work. (Of course, I’m even more interested in knowing what clients pay for temp /lawyers’/ work.)
The only way we’re going to get professional standards and compliance with ethics rules (not to mention reasonable compensation and working conditions) is if we organize and demand them. Anybody interested in that should write me (using a false name and an untraceable email account for now) at charliedeltaesq at gmail.com.
@Matt: Document review, as it’s currently conducted, isn’t the practice of law. Most of it’s just spotting key words and names. There’s no way you can exercise independent professional judgment when you’re forced to meet a 600-document quota every day. Properly organized document review would involve independent professional judgment on matters including relevance, privilege, and other legal matters. Reviewers then might not be entitled to overtime pay, but with hundreds or thousands of lawyers unemployed, there’s no reason for anybody to be working overtime anyway. Overtime pay exists to discourage employers from forcing employees to work excessive hours. If firms and agencies staffed their projects properly, planned their projects intelligently, and paid temps a decent wage, overtime wouldn’t be an issue.
* If all lawyers do is routine, assembly-line document review, as that work is currently arranged, they aren’t “engaged in the practice of law”. But if document review is only part of their work, it’s just as much “the practice of law” as any partner’s routine and clerical work. I recommend document reviewers find ways to mix in free-lance research, writing, court appearances, etc., with their document-review work. There’s lots of small law offices that can use that kind of help now and then.
* A non-disclosure agreement doesn’t satisfy the ethics rules regarding conflict of interests for attorneys, or any attorney could avoid conflicts by signing a piece of paper. This is just one more example of firms and agencies’ imposing legal ethics rules on temps when it suits them, while ignoring the rules on fee-splitting, unauthorized practice of law, non-lawyer supervision of lawyers, independent professional judgment, etc. The recent practice of making temps reveal every law firm, client, or litigant they’ve ever encountered in their working lives, rather than giving them a conflict list, just makes it even more burdensome for temps.
The only way we’re going to clean up this industry is by organizing in our own interests. The employers are organized, they’ve pooled their economic power, and that gives them the ability to dictate terms to us. Unless we do the same, our pay will keep falling, our hours will keep increasing, the length of projects will keep decreasing, and our working conditions will keep getting worse. Law suits are not enough.
If you want to discuss possibilities for organizing, write charliedeltaesq at gmail.com. Don’t write from work, don’t use your employer’s computer or BlackBerry, don’t give me your real name, and don’t use your regular email address.