Wall Street Journal Online (01/19/12) Joe Palazzolo

Legal staffing companies, hired by law firms to provide temporary lawyers to review documents in huge pieces of litigation, have dramatically expanded the scope of their services. A question has arisen over what services these firms can provide without violating regulations that prohibit them from practicing law. A regulatory committee of the Washington, DC, Court of Appeals recently drafted an opinion on the issue to give guidance to companies on the “permissible scope of services that may be performed without engaging in the practice of law.”

The opinion says the staffing companies may not provide legal advice to their clients or hold themselves out to be able to provide legal services, and they should avoid “broad statements that a company can manage the entire document review or discovery process” because they “have a serious potential to mislead.”

Huffington Post (01/19/12) Janell Ross

In June 2011, the U.S. Supreme Court ruled that companies can hold customers to arbitration agreements in which the customers gave up their right to sue as a class to resolve problems. Employers and worker advocates interpreted that ruling to include workers who have signed similar arbitration agreements. However, the U.S. National Labor Relations Board earlier this month ruled that workers with arbitration agreements do have the right to sue as a class. NLRB says such employees are still able to sue, even with agreements in place that waive that right, because federal law gives employees the right to assertively advocate for their interests in cases of overtime pay or the federal minimum wage and other work related conditions that are set by law.

A current case on the issue involves Labor Ready, a temporary staffing company. A group of workers filed suit in 2010 contending that the company’s pay system often left them with less than the federal minimum wage and that other company practices such as charging workers for rides to their work site violated various state and federal labor laws. Labor Ready, one of several temporary services owned by Tacoma, WA-based TrueBlue Inc., does not pay workers less than the federal minimum wage, says Stacy Burke, a TrueBlue spokeswoman. Labor Ready has denied any wrongdoing. As many as 35 million American workers have signed binding arbitration agreements, says Alexander Colvin, an associate professor at Cornell University’s School of Industrial and Labor Relations who specializes in workplace dispute resolution.

Wolters Kluwer (01/18/2012)

The U.S. Department of Labor’s Wage and Hour Division reports that the Temp Team Inc., a Dallas-based temporary staffing company, has agreed to pay $244,104 in back wages to 252 current and former employees after an investigation found violations of the Fair Labor Standards Act’s overtime and record-keeping provisions. An investigation by the Dallas district office found that 250 Temp Team employees worked as many as 79 hours a week and were paid a straight-time rate, instead of an overtime rate, for hours worked over 40 in a week. The company violated FLSA record-keeping provisions by failing to maintain accurate records of its employees’ total work hours and wages. Under FLSA, DOL notes, employees who are placed by a staffing company at a client site are typically considered jointly employed by the staffing firm and the client(s), and joint employers are responsible for ensuring FLSA compliance.

Seyfarth Shaw (01/05/12) Scott Schaefers

In the age of social media and networking, where employees use their company-issued computers to network with clients, suppliers, colleagues, and friends, a question has arisen over whether employers can claim an interest in their employees’ LinkedIn accounts, or other social networking accounts, which the employees use in part to grow and maintain their relationships for the benefit of their employers. In Eagle v. Morgan, No. 11-4303, 2011 WL 6739448, a federal court in Philadelphia held that an employer may claim ownership of its former executive’s LinkedIn connections where the employer required the executive to open and maintain an account, the executive advertised her and her employer’s credentials and services on the account, and where the employer had significant involvement in the creation, maintenance, operation, and monitoring of the account.

The court refused to dismiss the employer’s counterclaims for “misappropriation of an idea” and unfair competition against its former chief executive, who allegedly accessed and used her company-generated LinkedIn account three weeks after she was terminated. Employers and their lawyers should consider getting more involved in their employees’ social-networking activities, particularly to the extent that such activities are used for company business and where employees are required or expected to promote themselves on behalf of the company using these networking sites.

Minneapolis Star Tribune (01/19/12) Paul Walsh

The owner of Minneapolis-based Olen Staff Co., Doris Ruiz, pled guilty in federal court on charges that she failed to pay $150,000 in payroll taxes and $276,987 to cover the employers share of FICA taxes. In 2008, federal investigators shut down Olen after court affidavits alleged that Ruiz placed illegal immigrants with regional businesses, provided false documentation, and did not pay taxes for herself or workers for several years. Ruiz faces a maximum penalty of five years in prison when she is sentenced.