Wednesday, May 25, 2016

College Teacher Who Used Racial Slur In Class Fired

Original Story:

LAWRENCE, Kan. (AP) — A white University of Kansas assistant professor who used a racial slur during a class discussion on race said the school won't renew her contract after the next academic year.  If you have been fired contact a Memphis wrongful termination lawyer for help.

Andrea Quenette, who was cleared by a university investigation into complaints of discrimination, said Monday she was notified last week that she would not be reappointed to her job after the spring 2017 semester, The Lawrence Journal-World reported ( ). The decision came as Quenette, an assistant professor of communication studies, was undergoing a progress toward tenure review, which is routine for third-year faculty.

Quenette, 33, said she would teach an online communications class this summer and do only research during the fall semester. She said her duties for the spring 2017 semester have not been determined.

A group of graduate students demanded in November that Quenette be fired after she used the slur in a class, which was held the day after a contentious forum on race and discrimination at the university. It also came amid protests at the University of Missouri over administrators' handling of racial issues, which led to the resignations of the system president and chancellor of the Columbia campus.

Quenette has said diversity in the classroom was part of the syllabus for the class, which is for graduate students who teach undergraduate courses. After a student asked how they could talk about race in their classes, the conversation moved to how the university should address racial problems. Quenette said she used the slur when comparing the University of Kansas to other campuses and did not direct it toward a specific person.

Quenette has said she could have apologized "in the moment" if anyone had responded, but no one did, so she continued the discussion.

A letter seeking Quenette's firing included other complaints, describing her as racially insensitive, confrontational and unprofessional. She sought and was given an administrative leave until the situation was resolved.

After several students, some of whom were not in the class, filed complaints, the university's Office of Institutional Opportunity and Access determined in March that Quenette had not violated the university's nondiscrimination or racial and ethnic harassment policies. However, Quenette said her administrative leave from campus wasn't lifted until Friday. A Memphis employee rights lawyer may be able to help if you were wrongfully terminated.

Quenette said she "absolutely" believes the decision to fire her was based on race-related events of the past year rather than solely on her performance.

"I've been very powerless throughout the entire situation," she said. "I still believe that I was assumed guilty, and I had to prove my innocence for all of the issues."

Kansas spokesman Andy Hyland declined to discuss Quenette's employment situation, saying it is a personnel matter and "is not related to the claims of discrimination raised to the Office of Institutional Opportunity and Access," the Journal-World reported.

Semi-Truck Driver Detaches Cab, Takes Off After Deadly Vernon Crash: Police

Original Story

A search was underway for a semi-truck driver who apparently detached the cab from its trailer and took off after a deadly hit-and-run crash early Saturday morning in Vernon, California, and police have identified a "person of interest," officials said. Contact a Los Angeles truck accident lawyer if you need help in an injury case.

The crash was reported just after 3 a.m. near the intersection of East 37th Street and South Santa Fe Avenue, according to the Vernon Police Department.

Police said the driver was involved in a minor crash, about a block away from the scene, before running a red light and colliding with the Chevrolet pickup truck.

When rescue crews arrived at the scene, the pickup truck was found lodged underneath the trailer and the cab was missing from the 18-wheeler. 

Police said the driver detached his cab from the trailer and took off. A Los Angeles transportation lawyer was is disbelief.

Two people were trapped inside the pickup truck. The driver of the pickup was rescued and taken to a hospital with minor injuries. The passenger, identified as 28-year-old Armando Murillo of Pacoima, was pronounced dead at the scene, Vernon police said.

Guillermo Ortiz Jr. was identified by police as a person of interest and is believed to have information on the crash. Police were seeking to speak with him and anyone else who may have witnessed the crash.

Authorities found the trailer's cab abandoned in a parking lot on 26th and Soto streets. A restaurant employee near the site said she found beer next to the cab portion of the truck.

"It looks like he had two beers and left the rest of the 12 pack," Linda Sanchez said.

Eligibility For Overtime Pay To Increase By December

Original Story:

COLDWATER — New federal work rules to raise employee pay, issued Wednesday by President Barack Obama's administration, will impact both private and not-for-profits, but may adversely impact business. Contact a last paycheck lawyer Memphis is you did not get your final pay.
In Coldwater Bob Smith, of the Disability Resource Team at the the four county Workforce Development Board meeting, said recently employers indicated, “its really great for employees because they are going to get an increase in their wages, but that effects the bottom line. They are going to have to make cuts (in jobs or hours) or increase pricing to meet the increased wages.”
More than 4 million U.S. workers will become newly eligible for overtime pay under policy changes that are intended to expand overtime pay protections.
Rules from the 1930s require employers to pay workers time and a half for any work past 40 hours a week.
Employers, especially in the fast food and retail industries in particular, classify employees who work longer hours as managers to avoid the rule but most are barely paid more than the people they supervise.
Under the new rules, the threshold annual salary, at which companies can deny overtime pay, will be doubled from $23,660 to nearly $47,500. That would make 4.2 million more salaried workers eligible for overtime pay. A last paycheck lawyer Little Rock can help you get your final pay.
The more than 100,000 Michigan workers would be affected by this overtime change.
The White House estimates that the rule change will raise pay by $1.2 billion a year over the next decade, but concedes some companies may instead choose to reduce their employees’ hours to avoid paying the extra wages.
“Either way, the worker wins,” Vice President Joe Biden said while on a conference call with reporters Tuesday afternoon.
“With the stroke of a pen, the Labor Department is demoting millions of workers,” David French, a senior vice president for the National Retail Federation, said. “Most of the people impacted by this change will not see any additional pay.”
The Michigan League for Public Policy President and CEO Gilda Z. Jacobs said “For 2014, we calculated that a single parent in Michigan with two kids needs to earn a salary of $44,164 to make ends meet and cover their food, housing, healthcare, child care, transportation and other costs. In Michigan, households with two working parents and two small children have to collectively earn over $52,000 annually. They are the people who are working but still barely getting by. I am glad to see President Obama take this action.”
The higher threshold will take effect Dec. 1. The new rule is intended to boost earnings for middle and lower-income workers and could have a greater impact than efforts to raises the minimum wage.
The Workforce Development Board is a public-private partnership for Michigan works for Branch, Calhoun, Kalamazoo, and St. Joseph Counties.

Volkswagen Emissions Scandal Settlement Is On Track, Judge Says

Original Story:

Volkswagen and attorneys for vehicle owners affected by the company's emissions cheating scandal are on target to meet a June deadline for a final settlement proposal, a federal judge said Tuesday.   Even a Pikeville defective product lawyer has been hearing about the pending case.

Senior U.S. District Judge Charles Breyer said the parties have made substantial progress in reaching a deal for nearly half a million polluting Volkswagens in the U.S.

Breyer announced a tentative agreement last month that would give owners the option of having Volkswagen buy back or repair their vehicles. A Los Angeles product liability lawyer says this would be thousands of cars in California alone.

The judge did not provide any additional details about the ongoing talks.

The scandal erupted in September when it was learned that the German automaker had fitted many of its cars with software to fool emissions tests and had put dirty vehicles on the road. Car owners and the Justice Department sued.

VW, the U.S. Department of Justice and attorneys for Volkswagen owners have until June 21 to file a final settlement with the court.

Many questions remain unanswered, including how much money owners can expect in a buyback and how much additional compensation beyond repairs and buybacks they'll receive.

Breyer has the authority to reject any final deal that the parties propose. A Jackson product liability lawyer expects the money to be huge.

The tentative deal announced last month covers about 482,000 Volkswagens with 2-liter, four-cylinder diesel engines. It did not cover about 90,000 Volkswagen, Audi and Porsche diesel vehicles with 3-liter, six-cylinder engines.

Breyer said engineering studies and testing of those vehicles were ongoing. The tentative deal also does not cover potential fines and penalties. A Chicago product liability lawyer says the fines may be astronomical.

Volkswagen said in a statement after the hearing that it was pleased it has continued to make progress in settlement talks, and it thanked U.S. customers for their continued patience.

Why Obama's Overtime Rule May Barely Dent The Economy

Original Story:

President Obama’s new overtime rule have been trashed as a job killer by conservatives and heralded as a salve for the middle class by liberals. In reality, the measure probably won’t have much of an economic effect, partly because employers will find legal ways of getting around it. A Boston employment lawyer is already fielding questions.

The new rule sounds dramatic. Starting in December, anyone who is a salaried worker and makes less than $47,476 must be paid time and a half for any work beyond 40 hours a week. For the last decade, only people who made less than $23,660 automatically had to be paid overtime. Anyone who made more than the threshold and performed executive or administrative tasks at work was exempt from overtime.  Contact an Memphis overtime lawyer if you have more questions.

“This is the single biggest step I can take through executive action to raise wages for the American people,” Obama said in a weekly address Saturday.

It turns out that Obama is not raising wages for very many people. The White House estimates that 4.2 million people will become eligible for overtime compensation under the rule, and that it will push wages up by $1.2 billion a year for a decade. Contact a Memphis employment discrimination lawyer if you feel you have been discriminated against.

But about 60% of the 4.2 million workers who will now be eligible for overtime do not work any overtime hours, meaning employers won’t change their pay because of the new rule, the U.S. Department of Labor found. So only the remaining 1.7 million workers will get a raise, about $718 a year on average.

U.S. employers pay about $7 trillion to some 140 million workers each year. That means the rule will bump up wages by a fraction of a percent, and it will affect about 1% of the working population. Many will contact a Los Angeles employment lawyer for assistance.

"The rule will not have a disruptive effect on the broader economy given the share of workers affected, but it will be significant and meaningful for those who do benefit," Heidi Shierholz, chief economist at the Department of Labor, said in emailed comments.

In California, which already has an overtime ceiling that is close to the new federal threshold, the immediate effect will be even more muted. However, because the state's overtime ceiling is pegged to the minimum wage, it will rise sharply in coming years.

You might think that suddenly forcing employers to pay people time and a half for extra hours would make paychecks much bigger than they used to be for this small slice of Americans. You would be underestimating employers. Some of these employers may be involved in South Jersey employment litigation.

History shows that when governments tell businesses to pay people overtime, bosses respond by cutting base pay and hours.

It isn't clear, based on existing research, whether bosses will hire new employees to work the hours that they cut from existing employees. But a test case for how companies will respond played out in California years ago.

In 1980, the state began allowing men to claim overtime for time they put in after eight hours on the job each day; women earned the right to daily overtime pay decades earlier. Five years later, the share of California men working extra hours had declined 24%, while men in other parts of the country increased their overtime work, according to a study published in 2000 by Daniel Hamermesh and Stephen Trejo, economists at the University of Texas-Austin.

The study found no evidence that giving men overtime pay forced employers to hire more people. A Tulsa employment lawyer also ready the study.

“This raises the cost of work overall, so total hours worked will go down [and] the total amount produced will go down,” Hamermesh  said.

Producing slightly less may not seem particularly good, as far as American economic prowess goes.

But for workers, it has an upside.

Tuesday, May 24, 2016

Volkswagen, U.S. Make Substantial Progress Toward Final Deal: Judge

Original Story:

Volkswagen AG (VOWG_p.DE) has made substantial progress toward reaching a final settlement next month with car owners and the U.S. government over the German automaker's cheating on diesel emissions tests, a federal judge said on Tuesday. A London business lawyer has been review the case.

But major issues remain, including how much the world's No. 2 automaker may have to pay in fines, which could run in the billions of dollars, to federal and state regulators for violating U.S. clean air rules, as well as an ongoing U.S. Justice Department criminal probe.

U.S. District Judge Charles Breyer in San Francisco reiterated that a settlement will include substantial monetary compensation for U.S. owners of 482,000 polluting vehicles that emit up to 40 times legally allowable pollution.

The so-called Dieselgate scandal has hurt VW's global business as well as its reputation and led to the departure of its chief executive officer and other executives. Dieselgate erupted last September after the company admitted using sophisticated secret software in its cars to cheat exhaust emissions tests. As many as 11 million vehicles worldwide have been affected. A London litigation attorney has handled these types of cases.

At a brief court hearing, Breyer said lawyers for car owners suing Volkswagen and the U.S. Justice Department, Environmental Protection Agency (EPA), Federal Trade Commission, the state of California and the company were on track to file the final proposed settlements by June 21.

The "parties ... have reported that in the month since we last met they have made substantial progress in intensive daily efforts to finalize the agreement, and most importantly are on track to meet the court's deadline," Breyer said.

The U.S. settlement would also include an environmental remediation fund to address excess emissions and a fund to promote green automotive technology.

Elizabeth Cabraser, lead lawyer for the U.S. car owners, and a Volkswagen spokeswoman both said the parties were pleased with the continued progress and planned to finalize the agreements next month.

Breyer said engineering studies and testing were continuing toward a resolution for the owners of 80,000 larger 3.0 liter vehicles but offered no timetable.

The vehicles emitted up to nine times the legally allowable pollution, and it was not clear if the automaker will offer to buy back the larger 3.0 liter Porsche, Audi and VW SUVs and cars under investigation.

The EPA ordered VW last September to stop selling all new 2016 2.0 diesel vehicles. The ban was extended to 3.0 liter VW, Porsche and Audi diesel vehicles in November. The order remains in effect.

After the June 21 deadline the agreement faces a public comment period and must get final judicial approval, which could come at a July 26 hearing.

Volkswagen (VOWG_p.DE) shares closed up 4 percent.


Many thorny issues remain, including what happens to vehicles that Volkswagen repurchases and how the automaker will handle buybacks and fixes if the EPA approves.

Reuters reported last month that owners could have as long as two years to decide on whether to sell back their vehicles.

VW agreed on April 21 to a framework settlement with U.S. authorities to buy back or potentially fix about half a million cars fitted with illegal test-fixing software, and set up environmental and consumer compensation funds.

The next day, Volkswagen said it would set aside 16.2 billion euros ($18.2 billion) and slash its dividend to cover the costs from Dieselgate.

And there is unrest among investors. On Monday, three investor groups called for an independent inquiry, saying the company's investigations may not be sufficiently far-reaching or transparent.

Reuters has reported that a Volkswagen official said an investigation by law firm Jones Day into who was responsible for rigging the emissions tests was dragging on.

Volkswagen has come under attack from London hedge fund TCI and other investors who say the automaker needs to improve its performance and create a new governance structure.

The campaign has exposed divisions between the Porsche and Piech families who own the majority of Volkswagen, the state of Lower Saxony and powerful labor representatives who hold one-half of the seats on the company’s supervisory board.

Thursday, May 19, 2016

New Federal Law Intends To Help Firms Protect Trade Secrets

By Dustin Walsh
U.S. companies are set to find an ally in protecting valuable trade secrets from the federal court system.
Both the U.S. Senate and House of Representatives stamped their approval last month on the Defend Trade Secrets Act of 2015 — a bill that provides civil action in federal courts and stiff penalties for theft of protected information from corporations. President Barack Obama signed the bill last week. This act will be reviewed by an Atlanta trade secrets lawyer in full.
Tom Brady, partner and head of the labor and employment practice at Detroit-based law firm Clark Hill PLC, said the impending law creates uniformity — 48 states currently have versions of the Uniform Trade Secrets Act — for protecting trade secrets across the nation.
"Most states have a version of the trade secrets act, but it's a balkanized treatment to protection," Brady said. "(Trade secret theft) is increasingly a problem as technology expands and outside third parties increase hacking to get those secrets or employees that can now simply put in a thumb drive to download those secrets."
Trade secrets differ, and are often less protected, than copyrights and patents.
Trade secrets are considered private materials such as manufacturing processes that don't meet the patent guidelines, software, financial information, pricing information, etc.
The Defend Trade Secrets Act differs slightly from the Uniform Trade Secrets Act in that it allows a plaintiff fearing its trade secrets have been stolen to file a federal court order to allow the government to seize the stolen information before the alleged defendant is notified of a lawsuit — an ex parte seizure.
"I don't have evidence to support that this happens a lot, but I'd imagine whoever took the trade secret is likely to hide or destroy the (stolen) information to eliminate the proof," Brady said. "Before (the law), the information couldn't be seized until the lawsuit was over."
The penalties are also much stiffer under the Defend Trade Secrets Act. Plaintiffs can now seek up to two times the damages plus attorney fees, making a high-profile case very costly to the defendant, Brady said.
While the law will strengthen enforcement, companies still must ensure they are protecting valuable information to be considered a trade secret, Brady said.
"Companies need to start training employees on how to properly protect trade secrets in the first place," Brady said.
"Smart companies are going to put notices in their policy manuals and work to keep their secrets secret."

Wednesday, May 18, 2016

Trick Of The Trades At Tech

Original Story:

LYNN — Gregory Cooks is studying metal fabrication at Lynn Vocational Technical Institute, but he sees his future in construction. A Massachusetts construction lawyer offers services to those involved or defending construction accidents.

Cooks and 15 other Tech seniors spent last week studying the trades. They learned about building culverts and walls under the eyes of Massachusetts Construction Career Development Program instructors.

Experienced tradesman Tommy Lemon demonstrated how to set bricks in a round concrete drain to build a trough capable of channeling water through pipes. He also told the students how a laborer’s apprenticeship can lead to a $21 an hour job with generous benefits.

“One thing I stress is good work ethic and safe work practices,” he said. “Show up on time and be physically and mentally prepared to work at least eight to 10 hours a day.”

Cooks is considering construction apprentice opportunities Lemon and co-instructor Andy Kuzmich outlined for the students. A Massachusetts real estate lawyer may be involved if the construction project is to be location on newly purchased land.

“It gave me a clear idea of what I want to do career-wise,” he said.

Kuzmich said students interested in construction following the Tech orientation course will be invited to take part in a three-week apprentice course sponsored by New England Laborers.

Tech is one of 15 Bay State schools to host the construction career development program sponsored by the Department of Transportation and New England Laborers’ Training Academy, a group affiliated with building unions.

Kuzmich said an older construction workforce is prompting state and union officials to find students interested in the work. The program’s goal is to attract 300 students annually to the trades.

“I wish this was around when I was in high school,” he said.

Richard Wall, Tech’s construction department head, said Cooks, fellow seniors and a small group of juniors were chosen to participate in the orientation because they expressed an interest in construction work and are dependable.

Senior Enderson Mejia helped build an interlocking stone wall, a miniature version of giant walls designed to keep hillsides from sliding onto roads. He plans to study engineering next year at the University of Massachusetts-Lowell. But he enjoyed learning the detail work involved in professional construction.

“You don’t want anything to be crooked,” he said.

New Overtime Pay Rules Force Small Businesses To Make Hard Choices

Original Story:

NEW YORK (AP) — The government's new rules requiring overtime pay for millions of workers have small business owners facing some hard choices.

The regulations being issued by the Labor Department Wednesday would double to $913 a week from $455 the threshold under which salaried workers must be paid overtime. In terms of annual pay, the threshold rises to $47,476 from $23,660. The rules take effect Dec. 1. A Massachusetts employment lawyer is preparing his call center to receive extra calls.

Many businesses like restaurants, retailers, landscapers and moving companies will have to transition staffers, many of whom are low-level managers, to hourly pay and limit the number of hours these employees work. That can increase the workload for other staffers, have everyone scrambling to get work done in fewer hours and hurt morale. Some owners say they'll have to limit hiring, cut services or other costs. Others are turning to technology to try to get work done in less time. And some say they'll give staffers a raise to get them out of overtime territory.

Chad Brooks expects to switch managers at his eight franchise restaurants to hourly pay, and plans to send them home as soon as their shifts are over. Other staffers at the Pittsburgh-area Qdoba and Burger 21 franchises will have to pitch in to handle their work. Brooks already foresees problems, for example, if a customer wants to complain to the manager.  A Massachusetts business lawyer speaks to his clients about these similar problems.

"Guests will be extremely frustrated when they ask, 'where's the manager,' and a worker says, 'he's not here,'" Brooks says.

Brooks has warned his managers that the change is coming. They're not happy because they'll work fewer hours and take home less pay. And hourly pay in the restaurant business is seen as entry-level compensation, not the salary that managers get as they move up the ladder.

"Everyone coming to work for you wants to be salaried, have that cachet, that status," Brooks says.

The new rules, which will be revised every three years, aim to increase pay for an estimated 4.2 million workers, including many who work 45, 50 or more hours in a week without extra pay. Businesses have been on notice about higher overtime costs since last summer, when the government issued proposed regulations. Companies are on the hook not just for time and a-half, but also for higher Social Security and Medicare taxes employers must pay on all of a staffer's compensation. The rules don't cover many employees who are office workers, computer programmers or professionals.

Small businesses lack the large revenue streams and credit lines of bigger companies, so they may struggle to afford the additional overtime costs, particularly those already facing higher minimum wages or increased health care costs.

Some owners will decide that it makes sense to give staffers whose pay is close to the $47,476 threshold a raise rather than face an uncertain overtime bill going forward, says Jonathan Sigel, a labor attorney with the law firm Mirick O'Connell in Worcester, Massachusetts.

Money isn't the only issue. Managers used to staying at work until a task is done may feel demoralized when forced to leave work unfinished, says Midge Seltzer, president of Engage PEO, a human resources provider based in Hollywood, Florida.

"Most of the workplace consists of conscientious employees. It's going to be difficult for them to just throw their hands up and say, 'I'm done,'" she says.

Whether staffers will earn more or less under the regulations depends on the hourly wage each company sets. Many companies who expect to pay more are already looking at their budgets for other expenses that can be reduced or eliminated.

Ben Walker is cutting his marketing budget to come up with the money he'll need for overtime for the four staffers at his phone call transcription service. Walker, owner of Transcription Outsourcing in Denver, decided not to wait for the regulations; he put his workers on hourly pay last November after asking them what they thought would be a fair wage. The change has resulted in staffers getting higher pay and slightly fewer hours. His payroll costs, which account for half his expenses, have gone up 15 percent.

"I guess I could be angry about it, but it's the way it goes — and they're happier," Walker says. The staffers are team leaders at the company, overseeing freelancers who transcribe phone calls for doctors, lawyers and law enforcement agencies.

Automation is the answer for Deborah Sweeney. She's investing in customer service software for her online business services company, MyCorporation, because she expects higher overtime costs to limit her ability to hire more staffers. Thirty of the 43 employees at the Calabasas, California-based company will be affected by the new regulations. Software programs will help handle MyCorporation's growing workload.

Startups that expect to hire are now factoring overtime costs into their projected expenses.

Jeff Kerr, owner of Casefleet, an Atlanta company that makes software for law firms, anticipates hiring as many as 15 people in the next two years. The positions, which require less-experienced workers, will likely pay less than the $47,476 threshold.

"We will just have to pay them overtime wages," Kerr says.

Tuesday, May 17, 2016

At Least 5 Injured In Crash Involving Motorcycles, Passenger Vehicles On 210 Freeway In Irwindale

Original Story:

At least five people were injured Saturday evening in a collision that the California Highway Patrol said involved five motorcycles and two passenger vehicles on the 210 Freeway in Irwindale.

Firefighter-paramedics responded shortly after 7 p.m. to the westbound side of the freeway, just west of Irwindale Avenue, a supervisor with the Los Angeles County Fire Department said.

Five or six people were hurt in the crash, according to the Fire Department. Their conditions were not immediately known.

Several motorcyclists, who were not involved in the pileup, stopped to render assistance, according to a CHP incident log. A Los Angeles Motorcycle Accident Lawyer will more than likely use this information.

Four flatbed tow trucks were requested to remove the damaged motorcycles and other vehicles involved in the collision, including a BMW sedan that had been carrying four occupants, the log stated.

The CHP issued a SigAlert for the westbound 210, and the No. 1, No. 2 and carpool lanes were closed for more than an hour, the agency said on Twitter.

According to tweets from the Irwindale Police Department, traffic was heavy in both directions at the crash site. Motorists were advised to avoid the area while a cleanup operation was underway.

The SigAlert was later canceled and all lanes were reopened as of 8:40 p.m., police and the CHP said.

The cause of the incident was unknown.

Trash Truck Collision Will Cost L.A. $10 Million In Settlement

Original Story:

Los Angeles officials will pay $10 million to settle a lawsuit stemming from a 2012 accident involving a city sanitation truck and a pedestrian in a marked crosswalk. The city has hired a Los Angeles Truck Accident Lawyer.

Maria Becerra, who lives in Northridge, suffered severe injuries after being hit by a trash truck while she was crossing Reseda Boulevard. She is being consulted by a Los Angeles Injury Lawyer. As a result of those injuries, Becerra has a limited ability to walk, is unable to conceive children and probably will not be employable, according to an analysis of the case prepared by the city's lawyers.

The analysis, submitted to the City Council, said it would not be "unreasonable" to expect a $20-million verdict if the case went to trial. Police determined in the wake of the accident that the trash truck has a blind spot.

Becerra, 26, had the right of way in a marked crosswalk and was described by the city's lawyers as "shy, soft spoken and stoic."

"A jury will have great empathy for her," the analysis states.

Attorney Mike Arias, who represents Becerra, described the settlement as fair. "We're appreciative that instead of forcing her to go through years of additional litigation, that this matter was able to be resolved," he said.

The City Council approved the settlement Wednesday.

Thursday, May 5, 2016

Owners turn over Wisconsin firm over to surprised employees

Original Story:

A family with some of Milwaukee's deepest manufacturing roots has decided to turn its company over to the people it credits most for its success.

The families of Donald Baumgartner and his son, John, owners of Paper Machinery Corp., handed the 65-year-old Milwaukee company over to stunned employees Monday through an employee stock ownership plan, a change that over time could put hundreds of thousands of dollars into the retirement accounts of some longtime workers.

Paper Machinery says it's the world's leading manufacturer of machines used to produce paperboard cups and containers for brands like McDonald's, Starbucks, KFC and Tim Hortons.

The announcement of the change was made at an employee meeting in a big party tent in front of the company headquarters, with plenty of beer, food and a jazz band.

Not knowing what to expect, some workers were worried that Paper Machinery was being sold to another company.

"I would have to say there was a lot of anxiety. But I would be willing to bet now that everybody's elated," said Greg Winn from Menomonee Falls, a tooling designer who has worked at the company for 36 years. "We were really floored and pleasantly surprised."

Located at 8900 W. Bradley Road, Paper Machinery employs 250 people and posts more than $100 million in annual revenue. The company is now 100% employee owned.

"This is great news for our employees and great news for Milwaukee. The transition to employee ownership will ensure that Paper Machinery Corporation's legacy will continue right here in Milwaukee for generations to come," said Donald Baumgartner, who founded the company in 1951, and whose family has been manufacturing machinery in Milwaukee since the 1930s.

Under the new employee stock ownership plan (ESOP), eligible employees will earn shares of Paper Machinery Corp. stock over time. An ESOP is a federally regulated retirement plan that invests in the stock of an employer on behalf of its employees.

The plan is in addition to the employees' existing retirement benefits.

The company would have to remain profitable and meet its goals in order for the employee owners to realize the maximum benefits.

Some production employees could retire with more than a million dollars, said Steve Barth, an attorney with the Milwaukee law firm Foley & Lardner, legal counsel to the company in the transaction.

The Baumgartner family has been engrained in Milwaukee's manufacturing history for decades, from building machinery in the family garage to launching Milwaukee companies including Reliable Tool and Mercury Engineering, as well as Paper Machinery.

Donald Baumgartner got his start working for his father, John Robert Baumgartner. He went on to follow in his father's footsteps, founding Paper Machinery in 1951.

Every facet of the company's engineering, manufacturing and service takes place at the company's Milwaukee headquarters.

"We are deeply committed to Milwaukee and to our employees," Donald Baumgartner said. "When the time came to transition ownership, the choice was clear. Who better to carry on our legacy and tradition than the people who made the business successful in the first place — our managers and employees."

Over the years, Baumgartner said, he saw too many companies where employees lost their jobs after the business they worked for was sold.

"I watched my father build and sell three companies in Milwaukee, all three of which were moved out of state. I didn't want that to happen again," he said.

From those experiences, Donald Baumgartner and his son John decided that an ESOP was the best succession plan for Paper Machinery.

"This is a family business. Our employees are our family, making a transition to an employee-owned company a natural fit," said John Baumgartner, former president of Paper Machinery and now a member of the board of directors.

The business has grown rapidly in recent years, adding 50 jobs since 2014.

The Baumgartners will benefit from the sale of the shares to the ESOP, but not nearly as much as they would have from selling the company to another buyer.

"Despite my many strong recommendations that they market Paper Machinery Corp. to a third-party buyer, at a likely much-higher, cash-upfront purchase price, they instead insisted on pursuing an ESOP sale to ensure that their employees would be rewarded for helping them build PMC into the great company that it is today," Barth said.

"The Baumgartners put their employees, customers and community above their own personal interests in pursuing this transaction. Really quite remarkable, and very inspirational both professionally and personally," Barth added.

Operational control of the company is being transitioned to longtime managers Luca Dellomodarme, Scott Koehler and Michael Kazmierski.

"The success or the failure of the company is in the hands of the people who work here every day. We will be doing what we have always been doing, maybe with a little more responsibility," said Koehler, Paper Machinery's chief financial officer and treasurer.

Donald Baumgartner will continue to serve as chairman of the board of directors, with John Baumgartner remaining on the board.

"I am 85 years old, and I have been at this for over 60 years. The company is in incredibly good shape at the moment, so the timing could hardly be better," Donald Baumgartner said.

The Baumgartners say they will remain in Milwaukee, where they are active in the arts, theater and charities.

"I have strong roots here in Milwaukee. ... I care a lot about this community," said Donald Baumgartner, who is a past president of the Milwaukee Art Museum's board of trustees and served as chairman of the museum's building committee during construction of the Calatrava addition.

Originally, Paper Machinery was named Milwaukee Shipbuilding Corp. because the Baumgartner family initially thought about building a business refurbishing surplus military ships. The company, however, never touched a ship, instead turning its attention to building machines that make paper cups.

Now, with employees at the helm, "The ship is on course, the weather is fair, and the fuel tanks are full," Donald Baumgartner said. An ESOP Lawyer assisted in the transaction.