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Campolo, Middleton & McCormick, LLP, a premier law firm with offices across Long Island, is thrilled to announce that that Senior Partner Christine Malafi has been recognized by her peers for the sixth year in a row to be featured in The Best Lawyers in America® in the category of Employment Law – Management (2023 edition). With this distinction, Malafi ranks among the top five percent of private practice attorneys nationwide as determined by a rigorous peer-review process.

For over three decades, the legal profession and the public have turned to Best Lawyers® as one of the most credible measures of legal integrity and distinction in the nation. Inclusion in Best Lawyers is based on over a million confidential evaluations by top attorneys. The Best Lawyers’ founding principle forms the basis of this transparent methodology: the best lawyers know who the best lawyers are. No fee to participate is permitted.

Malafi chairs the Corporate Department at CMM, which was recognized by Forbes as a Top Corporate Law Firm in America. Her practice focuses on mergers and acquisitions, corporate governance, corporate transactions, drafting and negotiating a wide range of agreements, and helping businesses navigate all types of human resources matters. She routinely represents buyers and sellers in multimillion-dollar transactions and serves in a general counsel role for many of the firm’s corporate clients. In addition to her legal work, Malafi serves on the Executive Board of Directors of Family Service League, among others.

Campolo, Middleton & McCormick, LLP, recently recognized by Forbes as a Top Corporate Law Firm, is pleased to welcome Zachary Mike, Esq., as an Associate in the growing Corporate department. Zach focuses on M&A related matters including buy-side and sell-side transactions, as well as a variety of routine and complex corporate transactions. 

“2022 M&A is shaping up to be as robust as 2021 and CMM’s Corporate department is busier than ever, so we’re very happy to welcome Zach to the team,” said Senior Associate Vincent Costa. “Zach’s unique experience of working in a family-owned business [he previously worked at a well-known East End vineyard] has given him direct insight into CMM’s business-oriented approach and helps him understand the client perspective.”

At Hofstra University’s Maurice A. Deane School of Law, Zach was a member of the Journal of International Business and Law and served as a student tax attorney at Hofstra Law’s Tax Clinic, where he represented clients in tax controversies against the IRS. A graduate of Binghamton University, Zach was a member of the Chinese Music Ensemble and the Binghamton Crosbys, an award-winning a cappella group. He sang with Hofstra’s Legally Sound a cappella group and is a member of the New York City Bar Chorus.

Update: As of February 15, 2022, the Commissioner of Health has continued to designate COVID-19 as a highly contagious communicable disease that presents a serious risk of harm to the public health in New York State. This designation was extended to March 17, 2022.

by Jamie Herzlich, Newsday

Almost two years since the COVID shutdown, employers now have guidance on a key component of New York’s HERO Act, which among other things required employers to allow for the establishment of workplace safety committees.

The state Department of Labor recently released a proposed rule providing details on the composition and operation of these committees, which would allow workers at firms with 10 or more employees to raise workplace health and safety issues and review health and safety policies.

While the workplace safety committee provision technically took effect Nov. 1, legal and safety experts say employers were fuzzy on their obligations until the DOL released the proposed rule on Dec. 22.

“Until the proposed rule came out, employers didn’t really know what they needed to do to be in compliance,” says Christine Malafi, a senior partner and chair of the corporate department at Campolo, Middleton & McCormick LLP in Ronkonkoma.

The employers had the potential setup of committees on their radar, but without further detailed guidance were more immediately focused on creating airborne infectious disease exposure prevention plans, another component of the HERO Act, she said.

Employers must keep in effect those prevention plans until Feb. 15 — or later if New York’s Health Commissioner Mary Bassett extends the designation of COVID-19 as a highly contagious communicable disease that presents a serious risk of harm beyond that date, Malafi says. Experts expect an extension.

Not just about COVID

But consider that the HERO Act’s safety committee provision isn’t just about coronavirus prevention — it also deals with overall workplace safety.

Also, keep in mind, employers are under no obligation to create these committees on their own, but must allow for them to be formed upon a written request by employees, Malafi says.

Specifically, the guidance dictates, among other things, that, “committees may be established for each worksite following a written request for recognition by at least two non-supervisory employees who work at the worksite,” says Malafi. “Multiple requests for committee recognition shall be combined and treated as a single request to form a committee,” the rule says.

Asking for it

The committee must be comprised of at least two non-supervisory employees and at least one employer representative. Upon the receipt of a request for recognition, employers shall respond to such request with “reasonable promptness.”

Among their obligations, after the establishment of a workplace safety committee, employers must respond, in writing, within a reasonable time period, to each safety and health concern, hazard, complaint and other violations raised by the workplace safety committee or one of its members, Malafi says.

Read the full article on Newsday‘s website.

Learn more about employee safety committees by joining us on February 18th: Event Details

Employers want to know: will 2022 mark the end of the employee non-compete agreement?

Federal Efforts

In July 2021, President Biden signed an executive order aimed at promoting competition in the U.S. economy. The executive order encourages the Federal Trade Commission (FTC) to ban or limit employee non-compete agreements. According to the Biden administration, this FTC-directed crackdown on non-competes is meant to “curtail the unfair use of non-compete clauses and other clauses or agreements that may unfairly limit worker mobility.” In his remarks last summer, President Biden noted that non-competes not only affect highly paid executives but also tend to unfairly target low-wage earners who should be free to take a better job if given the opportunity.

A non-compete agreement is essentially a contract wherein an employee agrees not to work for or otherwise engage with competing businesses, and/or not to use information learned during employment, when their current employment ends. The purpose of these types of agreements (also known as restrictive covenants) is to avoid competition for an agreed-upon period of time after an employee leaves.

Since the executive order in July 2021, the FTC has not initiated any action or rule regarding non-compete agreements. Part of this delay involves a vacancy on the FTC Committee, which is required to have five members. President Biden recently resubmitted a nomination for Georgetown University Law Professor Alvaro Bedoya, but until the vacancy is filled and a fifth Committee member confirmed, the FTC is unlikely to take concrete action on non-compete agreements.

Besides the Biden administration’s executive order, there have been other federal efforts to prohibit non-compete agreements. First introduced in January 2019, Congress’s Freedom to Compete Act amends the Fair Labor Standards Act of 1938 to prohibit an employer from enforcing or threatening to enforce any non-compete agreement in employment contracts with certain entry-level, lower wage workers. The Act is currently stalled in the Senate Health, Education, Labor and Pensions Committee. 

New York State Efforts

As the law currently stands in New York, non-compete agreements are generally permitted as long as they (1) are necessary to protect the employer’s legitimate business interests, (2) do not pose an undue hardship on the employee, (3) do not harm the public, and (4) are reasonable in time period and geographic scope.

Even if the federal rule change does not come to pass, the future of non-compete agreements in New York could soon change regardless. During her first State of the State address in January 2022, Governor Hochul pledged to ban non-compete agreements in New York State for workers making below the median wage in the state.

Several other states have already amended their own laws pertaining to non-compete agreements. Oregon and Illinois recently prohibited non-competes for certain employees earning less than a certain salary per year. The District of Columbia has completely banned employee non-compete agreements – a law that will go into effect on April 1, 2022.

While federal and state changes remain uncertain, it’s still important for employers to make sure that all agreements, including non-competes, are tailored to best meet their goals within the law’s limits. Please contact our labor and employment team for guidance.

As the end of the year is approaching, it is important to remind New York State employers and employees of the increased minimum wages that affect both hourly and salaried employees.

For hourly, non-exempt workers, please see the below chart for basic hourly minimum wage increases that go into effect as of December 31, 2021:

Minimum Wage Increase

To the extent you or your workforce are paying basic minimum wage, it is important to make sure that the increased wages are reflected as of December 31, 2021.

Tip Credit

New York State also allows employers in certain industries to satisfy the minimum wage by combining a cash wage paid by the employer plus a credit for tips the employee receives from customers. The minimum hourly rates New York employers must pay most tipped employees go into effect as of December 31, 2021:

Service Employees

Food Service Employees

The “tip credit” rules can be difficult to follow, so it is important to track this information to ensure that tipped employees are receiving at least basic minimum wage, inclusive of tips, when calculating wages.

Increased Salary Threshold for Overtime Exemption

Finally, there are increases in the minimum salary threshold that must be met for exempt employees. As of December 31, 2021, the following minimum salaries must be paid for exempt administrative and executive employees:

With the upcoming changes, it is important to update policies and pay practices to stay in compliance.  If you have questions about minimum wage, overtime, or wage and hour exemptions, please contact us here or call (631) 738-9100.

By Patrick McCormick

While the COVID-19 pandemic has not been kind to many business owners who had to comply with temporary closures and declining revenues, commercial tenants have nevertheless faced an uphill battle in Court trying to walk away from their rent payment obligations. While tenants seeking to be completely absolved from paying rent have not met much success in the court system, we have assisted many clients in successfully renegotiating their lease terms without resorting to litigation. Here, a look at the arguments that haven’t worked in Court, illustrating that negotiation is often a better strategy for landlords and tenants alike.

The unprecedented pandemic led to many commercial landlords and tenants finding themselves in the position of landlord Bay Plaza Community Center and tenant Vistasite Eye Care.[1] This commercial landlord-tenant case stemmed from the tenant’s failure to pay rent from April 1, 2020 (the height of the pandemic) and after. Bay Plaza commenced a suit for back rent and moved for summary judgment. In opposition, Bronx Vistasite sought cover under the doctrines of impossibility and frustration of purpose to excuse its failure to pay rent. The tenant also argued that then-Governor Cuomo’s various orders relating to the pandemic devastated its business, and that the temporary closure of the business due to these orders constituted a “taking” under the lease.[2]

The Supreme Court, New York County (Bluth, J.) disagreed. In granting the landlord’s summary judgment motion, the Court found that Governor Cuomo’s executive orders did not constitute a taking since the case did not involve the government condemning the building or invoking the doctrine of eminent domain. Further, the Court found that the doctrines of frustration of purpose and impossibility “have no place in this case.” The Court contended that a temporary hardship like the one described by the defendant does not excuse a tenant’s obligation to pay rent and therefore ruled in favor of the landlord and plaintiff in the case: Bay Plaza Community Center.

A similar scenario played out between landlord 695 Fifth Owner and tenant Valentino U.S.A.[3]Here, luxury retail and fashion brand Valentino brought suit, contending that the lease of its four-story Valentino Fifth Avenue New York boutique should be terminated, and seeking a determination that Valentino should be entitled to an abatement of any rent claimed due.

The lease had clearly stated that Valentino would be able to operate as a boutique retail store for customers to view and sample their merchandise in a luxurious setting, in addition to experiencing high-quality service and amenities. The lease also provided that Valentino was required to be open for business and continuously operate under the Valentino brand. Because of the COVID-19 pandemic, including the restrictions, social-distancing measures, a lack of consumer confidence, and a prevailing fear of “non-essential” luxury retail boutiques, Valentino claimed that its business had been “substantially hindered, rendered impractical, unfeasible, and no longer workable.”

Given the continuing business restrictions even as the shutdown orders eased, Valentino argued that it would be impossible to operate its boutique as initially envisioned under the Lease. Thus, Valentino contended that their continued operation at that location was impracticable, infeasible, unworkable, and/or impossible. Valentino then gave notice to the defendant landlord that they would vacate and surrender the premises by December 31, 2020.

Despite Valentino’s complaint, the New York County Supreme Court (Borrok, J.) dismissed the case because pursuant to the lease, the parties expressly allocated the risk that Valentino would not be able to operate its business and that Valentino is therefore not forgiven from its performance, including its obligation to pay rent by virtue of a state law.

The fact that the COVID-19 pandemic was not specifically enumerated by the parties does not change the result because the lease was drafted broadly and did not provide that government regulations and events beyond the reasonable control of the party “delayed in performing work” shall excuse the payment of rent. Furthermore, Valentino’s general allegation that the landlord failed to maintain the premises lacks causation since it appears Valentino continued to operate in the store as of July 22, 2020.

The challenges faced by the tenants trying to get out of their obligations in these cases – as well as the challenges faced by the landlords spending time and money in Court – illustrate that commercial landlords and tenants are often better served by negotiating their disputes rather than litigating them. CMM has successfully negotiated countless commercial lease issues since the start of the pandemic.

Please contact us to discuss the path forward.

[1] Bay Plaza Community Ctr. v Bronx Vistasite Eyecare, Inc., 2021 NY Slip Op 31568(U) May 5, 2021 Supreme Court, New York County

[2] Under the COVID-19 Emergency Eviction and Foreclosure Act of 2020, a residential or commercial tenant has the option to submit a “hardship declaration” stating that due to COVID-19, they are unable to pay rent. In that case, a landlord would not be able to evict the tenant until the moratorium is lifted (former Governor Cuomo signed an extension of the act in May, extending the moratorium until August 31, 2021; however, in September, Governor Hochul signed into law a new moratorium which is in effect until January 15, 2022). In the Bay Plaza Community Ctr. v Bronx Vistasite Eyecare, Inc., no such declaration was filed.

[3] Valentino USA v. 693 Fifth Owner LLC, 70 Misc.3d 1218(A) (Sup. Ct. N.Y. Cnty. Jan 27, 2021)

Campolo, Middleton & McCormick, LLP is proud to announce that ten attorneys at the firm, in multiple practice areas, have been named to the 2021 Super Lawyers list, three of them as a “Rising Star.” The CMM attorneys recognized this year, in practice areas including Business and Corporate, Personal Injury, Real Estate, Business Litigation, Mergers & Acquisitions, Construction Litigation, Employment Litigation, Civil Litigation, and Appeals, are:

• Joe Campolo
• Scott Middleton
• Patrick McCormick
• Christine Malafi
• Jeffrey Basso
• Donald Rassiger
• David Green (Rising Star)
• Vincent Costa (Rising Star)
• Richard DeMaio (Rising Star)

The rigorous Super Lawyers selection process is based on peer evaluations, independent research, and professional achievement in legal practice. The “Rising Stars” recognition denotes superior professional achievement by attorneys who have been in practice for under 10 years or are under age 40. No more than 2.5 percent of lawyers in New York State are named to the Rising Stars list.

Learn more about CMM’s outstanding legal professionals here.