Legal Misinformation on the Web, Starting with a Supreme Court.

Sure there's a lot of legal misinformation on the web, but I wasn't expecting it on the website of a state supreme court (not Colorado's). The enormity of legal resources and forms—the good and the bad--on the internet has been positive for my practice. Documents are a commodity; critical thinking, however, including knowing the right form or resource to start with, is of much greater value.

You can imagine, then, my concern upon discovering reliable sources of THE LAW to be in disagreement over the wording of a state court rule. Sure, I expect disagreement over matters of legal opinion, but the text of rules and statutes are objective, not subjective, statements of the law. They are what they are. And they used to be published only in books available in libraries; now they are everywhere.

My Colorado client wants to expand its business into another state. A set of rules issued by the supreme court in that state governs an aspect of my client’s plan, so my firm checked those rules using a subscription-based online research library. Seeing no problems, we gave our client the initial go-ahead and began arranging for a lawyer in that other state to get involved.

In a subsequent call with my client, I needed to refer to a specific portion of the rule. Instead of taking the time to log-in to our subscription service, I pulled-up the rule on the state supreme court’s website. What I saw stopped me mid-sentence. The rule on the court’s site clearly prohibited an aspect of my client’s plan. Stunned, I asked my client to give me some time to double-check our initial conclusion.

Several phone calls later, we confirmed that the subscription service had the official and correct version of the rule, and that the state supreme court’s site had inadvertently omitted an amendment, which omission they immediately corrected. The client’s plan was on again.

The incident was a great reminder to me to heed a lesson I repeatedly tell my children. Don’t believe everything (or much of anything) you read on the web. When answers matter, go to the definitive source, which may not be what you think it is. Most readers of that state supreme court site would not think it necessary to verify its accuracy, but I hope their lawyers would.

About Me: My Q & A with the Colorado Children's Chorale

The Chorale Connection blog recently posted an interview with me by Mandy Branam. I thought cross-posting it here would supplement the brief “About Me” part of this blog and put my claim to the title “Community Steward” in better focus. As I explained in Standing on Shoulders, one of my first posts, good businesses make money, but great businesses build communities that make good business possible. My connection to the Colorado Children’s Chorale started because I saw what it meant to my daughter, now graduated from the CCC, and I wanted that opportunity to be available to any child in Colorado. If I improve the life of a child, I improve Colorado for generations.

Q & A: Jim Thomas

March 12, 2010 by choraleconnection

Jim Thomas and family

We chatted the other day with Jim Thomas, President of the Chorale Board of Trustees. Jim first became acquainted with the Colorado Children’s Chorale nearly 8 years ago when his daughter, Genevieve, became a member of Prep Choir. Jim and his wife Candace have been married for 26 years and in addition to Genevieve, have a daughter named Olivia. By trade, Jim is a lawyer at Minor & Brown in Denver. He spoke with the Chorale Connection about the many other activities he’s involved in, what kind of music he listens to, and his favorite Chorale memories.

CC: How long have you been President of the Board for the Colorado Children’s Chorale?

JT: I’ve been President since July 1, 2008 and a member of the Board for almost 5 years.

CC: Why did you get involved with the Chorale?

JT: My community efforts focus on children. I do that to pay forward for, as a youth, I was the beneficiary of adult stewardship in Scouting, and, I do it to maximize the return on my volunteerism because helping kids helps the entire community for years to come. Before the Chorale, I was involved in service-oriented organizations — Boy Scouts, The Children’s Hospital, and The Kempe Foundation. My daughter, Genevieve, had been in the Chorale for a few years when the opportunity to join the Chorale board came along. Being part of a transformative arts program for kids has been a new and wonderful experience for me.

CC: What do you do for your day job?

JT: I am a lawyer with Minor & Brown. I work with what I call human-owned businesses. My clients are companies owned by one person, a small group of people, or a family. My practice is mostly problem solving and negotiating all kinds of contracts that come up in growing a business or transitioning out of one.

CC: What other activities are you involved in?

JT: I’m active in my church, Montview Boulevard Presbyterian, my daughters’ schools, and some other business and civic nonprofits. I love photography, cooking and most any outside activity, but especially cycling and hiking.

CC: Why did you start your blog and what topics do you like to discuss there?

JT: Marketing consultants got after my law firm for not using social media, so I started No Funny Lawyers. Attracting clients is the reason for the blog, but I’m having fun, too. I was an editor of my high school newspaper and blogging expresses a part me that law never has. My topics are, ostensibly, the law and legal concerns of human-owned companies, but because I believe that great businesses build community, I write on community stewardship matters as well. I got a bigger megaphone, especially for community concerns, when the Huffington Post gave me a spot. By the way, the banner photo on No Funny Lawyers is me and Candace at the 2009 Chorale Celebration. Maybe one from this year’s Beach Ball (the Chorale’s 2010 Gala) will replace it.

CC: What kind of music do you like?

JT: Colorado Children’s Chorale music, of course. Seriously, I do love choral music, and I always love hearing our kids sing. Some of my favorite CCC songs come out of Apprentice Choir with its combination of raw child emotion and a year of Chorale polish, but I love all the choirs and watching over several years as the children progress through them. Apart from the Chorale, my music tastes are pretty broad, but singer-songwriters in folk and blues traditions are at the top of my list.

CC: Do you sing?

JT: Yes, but with more enthusiasm than skill. My daughter Olivia posted a “Caution: Driver Singing” sticker on my car. After seeing the movie version of Mamma Mia, I quipped: “At least I sing better than Pierce Brosnan,” to which Genevieve promptly replied: “No, you don’t.” Ouch.

CC: What is your favorite movie and why?

JT: Local Hero stands out among my favorite films. It’s a whimsical gem about a Texan who travels to Scotland to buy an entire fishing village in order to clear the way for an oil refinery. That’s the plot; the magic is in writer/director Bill Forsyth’s sly study of human beings — our assumptions and our priorities — set against a gorgeous Scottish landscape and underscored by the first soundtrack written by Mark Knopfler (of Dire Straits). I’m an occasionally funny, deal-making lawyer with roots in Texas and Scotland, so I love this beautiful, intelligent, and often wacky movie.

CC: What is the food item you can’t live without?

JT: Good olive oil. I can find a close substitute for other foods that are important to me, but not olive oil.

CC: What is your favorite memory or experience from working with the Chorale?

JT: There are so many, but since I’ve been both parent and trustee, I’m picking two.

As a trustee, my favorite experience was my day with Tour Choir at the 2008 Democratic National Convention. I wrote about the experience in my CCC newsletter debut. Watching the kids go from being professionals to being kids to being professionals, again and again, in that setting, was fantastic. A slideshow of some of my photos and a recording of the kids is linked to my No Funny Lawyers post on Memorial Day.

As a parent, my choice is an April 2009 concert in Colby, Kansas. National Tour Choir had been singing their way across the country. Colby was their last stop before home. Candace and I, as well as several other parents, drove out across the plains to see the show. There would be later gigs that season, but this was the last time this choir would sing together by themselves, and for many, Genevieve included, it marked the end of their Chorale journey. The tears started early. In the last couple of songs, tears flowed freely down the cheeks of boys and girls alike (and parents, too), but the smiles and the wonderful music never stopped. It was a beautiful tribute to a beautiful organization.

Tears and laughter, National Tour Choir after their 2009 Colby, Kansas show

 

I had some fun running the Chorale's mission, vision and values through the magic of Wordle.  Try it yourself at http://www.wordle.net/

One in Three Businesses at Risk in Independent Contractor Crackdown

Caesar: The ides of March are come.
Soothsayer: Aye, Caesar, but not gone.
—Julius Caesar, Act III, Scene 1

On this March 15th, human-owned businesses don’t need Shakespeare’s Soothsayer to warn of forthcoming trouble in the classification of employees and independent contractors, the Federal budget does that for us. A joint enforcement effort by the Treasury Department (home of the IRS) and the Labor Department (home of the Wage and Hour Division, enforcers of the Fair Labor Standards Act) to reclassify independent contractors as employees is projected to add at least $7 billion to the government’s bottom line over the next ten years.

Business and government have wrestled over the proper classification of workers as employees or independent contractors for years. Why? The New York Times, in an article citing reports of almost one in three businesses misclassifying employees as contractors, summed up the stakes this way:

Companies that pass off employees as independent contractors avoid paying Social Security, Medicare and unemployment insurance taxes for those workers. Companies do not withhold income taxes from contractors’ paychecks, and several studies have indicated that, on average, misclassified independent workers do not report 30 percent of their income.

Some businesses intentionally misclassify workers. In the process, they take advantage of those workers, gain an unfair advantage on companies playing by the rules, and increase the tax burden on everyone. Many more businesses, however, are victims of the subjective nature of worker classification.

You see, there is no clear definition of “employee” in the Internal Revenue Code. Instead, we are told to use traditional legal concepts involving control of the worker in order to distinguish employees from nonemployees. The IRS developed a list of 20 factors to aid in classification inquiries.  For those who love details, those 20 factors are included after the jump at the end of this post; for the rest of you and for business owners generally, the IRS boiled-down the 20 factors into three categories for proper worker classification:

• Behavioral: If the business has the right to control only the result of the work, then the factor indicates a contractor. If the business has the right to control how the work is done, then the factor indicates an employee.
• Financial: If the worker risks losing money doing the work, the factor indicates a contractor. If expenses of the work and the tools and supplies needed are provided by the business, the factor indicates an employee.
• Type of Relationship: The existence of a contract and what it calls the relationship isn’t generally a factor, but please don’t claim a worker as a contractor when he or she has an “employment” contract with you. Beyond that, the presence of employee-type benefits (i.e. pension plan, insurance, vacation pay, etc.) indicates employment, but the absence of benefits doesn’t mean the worker is a contractor. Long relationships and work that is the key to the business of the employer indicate employee status.

While the circumstances of each situation still need to be considered, two facts above all others put a classification at risk of a government challenge: One, the business has both employees and contractors performing essentially the same duties, and two, the contractor in question was formerly classified as an employee to do essentially the same work.

If you have either of those two facts against you or if you have questions about the application of these factors in your business, then you could become part of that additional $7 billion in revenue the government is counting on from this effort. See me or your lawyer to review your situation before that happens.

The Twenty Factors Used by the IRS
From Revenue Ruling 87-41 issued by the IRS in 1987