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Rehearing in Murphy tax case
December 26, 2006 by Ross Runkel at LawMemo
How often does a court hold that the Internal Revenue Code is unconstitutional?
The District of Columbia Circuit did. Scores of experts criticized and ridiculed the decision. Now the court has announced a rehearing in the case.
Facts: Murphy recovered damages from her employer on her claim that the employer violated various whistleblower statutes and retaliated against her. The damages were awarded in a Department of Labor administrative action. The administrative law judge specified that part of the award was for "emotional distress or mental anguish," and part was for "injury to professional reputation."
District of Columbia Circuit's first decision: Murphy v. Internal Revenue Service (08/22/2006). [This decision has been vacated due to the rehearing.]
The DC Circuit held that Section 104, as applied to Murphy, is unconstitutional. This was for two reasons. (1) Under the 16th amendment, Congress has the power to tax only "gain[s]" or "accessions to wealth." Commissioner v. Glenshaw Glass, 348 US 426 (1955). "[T]he damages were awarded to make Murphy emotionally and reputationally 'whole' and not to compensate her for lost wages or taxable earnings of any kind. The emotional well-being and good reputation she enjoyed before they were diminished by her former employer were not taxable as income. Under this analysis, therefore, the compensation she received in lieu of what she lost cannot be considered income ...." (2) The "original understanding" of the framers of the 16th amendment was that they "would not have understood compensation for a personal injury - including a nonphysical injury - to be income."
District of Columbia Circuit's order for rehearing (12/22/2006) announced new oral arguments to be held on April 23, 2007.
My view: Never underestimate the governments' power to tax. I expect that if the panel does not change its position, then the whole court will sit en banc and hold that the tax passes constitutional muster. [My previous comments on this case]
Thanks to Tax Prof Blog: D.C. Circuit Panel Agrees to Rehear Murphy, where you can get tons more details about this controversial question.
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No accommodation for hearing impaired firefighter
December 12, 2006 by Ross Runkel at LawMemo
Christopher Carlton, a hearing impaired applicant for a firefighter position, sued the employer for failure to hire. He alleged handicap discrimination in violation of state law and the Massachusetts Constitution. The trial court granted summary judgment in favor of the employer. The Massachusetts Supreme Judicial Court affirmed.
Carleton v. Commonwealth (Massachusetts 12/07/2006)
The court found that where the hearing acuity standard was an essential qualification for a firefighter and the accommodation sought (the use of hearing aids) was not a reasonable one as determined by the Legislature, Carleton had no reasonable expectation of proving that he was a qualified handicapped person.
The court concluded that, for purposes of Article 114 of the Amendments to the Massachusetts Constitution, an "otherwise qualified handicapped individual" in the employment context was one "capable of performing the essential functions of a particular job, or who would be capable of performing the essential of a particular job with a reasonable accommodation to his handicap," and that the constitutional claim failed.
My view:
This is a limited decision, limited to the state of Massachusetts, and limited to public safety personnel who are covered by the Massachusetts statute.
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FMLA Request for Information
December 05, 2006 by Ross Runkel at LawMemo
Federal Register Notice: http://www.dol.gov/esa/whd/06-9489.pdf
Special DOL web site: http://www.dol.gov/esa/whd/fmlacomments.htm
The US Department of Labor has published a formal notice requesting comments on the Family and Medical Leave Act (FMLA). Instead of publishing proposed new rules for comment, DOL is first seeking comments on 12 substantive areas:
- (1) Eligible Employee
- (2) Definition of "Serious Health Condition"
- (3) Definition of a "Day"
- (4) Substitution of Paid Leave
- (5) Attendance Policies
- (6) Different Types of FMLA Leave
- (7) Light Duty
- (8) Essential Functions
- (9) Waiver of Rights
- (10) Communication Between Employers and Their Employees
- (11) FMLA Leave Determinations / Medical Certifications
- (12) Employee Turnover and Retention.
Deadline for comments is February 2 2007.
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Editor: Ross Runkel, Professor of Law Emeritus. email Ross@LawMemo.Com, Phone 503-399-8028. Copyright LawMemo, Inc.
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