A Lawyer's Advice Can Help Businesses Determine Direction, Strategy
To some businesses, a lawyer's job is signing off on employment policies, writing up contracts and being on call if something really bad happens. But often, lawyers do much more than that. They're advisors and educators who can explain what new legislation and court rulings mean to specific clients' ways of doing business.
“It's easy to do a nondisclosure agreement,” said Rob Adler, managing partner of Seder & Chandler LLP in Worcester. “It's hard to give advice on whether you should even enter into a nondisclosure agreement.”
Central Massachusetts business lawyers say a big part of their job is simply staying informed about the issues that affect their clients, then making sure the clients are informed too.
For Adler, that means getting updates from subscription-based legal news outlets like Westlaw, using research tools that send information on new developments to his smartphone, and reading the Wall Street Journal, the New York Times, local papers and business news on Bloomberg.
“I have to be aware of the macro and micro economic issues that are facing my clients,” he said.
One of the big legal questions for many employers today is what Obamacare will mean to them.
“We have done a number of things with clients both in terms of written communication and giving seminars and talks of various types,” said Peter Martin, a partner at Bowditch and Dewey in Worcester.
Martin said his clients are asking how to record their total number of employees, including temporary and seasonal workers, to determine whether they reach the law's 50-employee threshold for providing insurance coverage. They also want to know how to calculate their liability under the “shared responsibility” provision if they don't provide sufficient insurance, and how to tell whether any insurance they do provide meets the law's minimum requirements.
Martin said there's a reason many employers are confused: The law is extraordinarily complicated, and regulatory guidance on how to interpret it is still coming in.
“I have a hard time understanding, much less explaining to employers,” he said. “I've got a cubic yard of statutes and regulations and sub-regulatory guidance… I'm barely keeping my head above water on this.”
Post-DOMA Impacts
John McMorrow, a benefits attorney with Mirick O'Connell of Worcester, Westborough and Boston, said another important issue for employers, the U.S. Supreme Court's ruling striking down the Defense of Marriage Act, also has aspects that aren't completely clear yet.
But he said there's definitely advice he can give clients. If they provide benefits to same-sex spouses of their employees, the new legal situation means the benefits aren't subject to federal taxes.
“That's really going to entail discussion with their payroll administrator,” he said.
There's also the question of how to identify employees who are in same-sex marriages so they can adjust any necessary benefits paperwork. McMorrow said he's told clients that they may want to send a mass communication to their workers to make sure they know who's affected by the change.
But a big outstanding question is whether, since DOMA was ruled unconstitutional, it should be treated as if it never existed.
“Does (a same-gender) couple have a right to assert a tax refund claim for payment of taxes?” he said. “We don't know whether the change is going to apply retroactively.”
Navigating 'Non Competes'
In some cases, legal issues are less than clear-cut, even though the law hasn't changed. Jonathan Sigel, a partner in Mirick O'Connell's Labor, Employment and Employee Benefits Group, said he works with clients who need to figure out the fine details of non-compete agreements. One issue that's come up, he said, is whether an employee who changes positions is still subject to a non-compete agreement, especially if the change is a demotion. Sigel said the question can come down to which judge hears the case.
“There (are) some judges that say, well, the deal changed,” he said. “Other judges say none of that matters.”
In some cases, different interpretations of a law are settled by a higher court, but Sigel said non-compete agreements tend to be resolved early in the legal process and don't move on to an appellate court, where questions might be settled more definitively.
Another complicating factor is that judges may take a different position than they otherwise would when the economy is rough, simply because they don't want to keep workers from moving to new jobs.
Understanding Business
Adler, of Seder & Chandler, said not all the guidance he gives clients has to do with the law. When he helps iron out financial agreements like loans and investments, part of his job is to understand businesses' growth projections.
“Perhaps our guidance is more skeptical of projections given by troubled businesses because we're not seeing the upturn in the economy that you would normally see when a recession has ended,” he said.
Similar calculations come into play when helping owners sell a business, or even in dealing with disputes between business partners. Those are more common in a bad economy, he said.
“Whether it's a marriage or a partnership, they can kick the can down the road while money's coming in the door,” he said. “When the money slows, they start fighting.”
Adler said these kinds of issues are why he needs to keep up with the business news.
“You can only read tea leaves if you know how to read tea leaves,” he said.
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