Questions to the Lawyers

Submitted by Rebecca Tell, member-owner

This is a record of the questions asked by participants in the meeting with coop attorneys John Vero and Joan Marie Dowling that happened yesterday, 11/14/15.  The first set below were questions generated at the beginning of the meeting, some of which were answered or partially answered in the lawyers’ presentations.  The second, larger list is the questions I gathered from around the room in writing because the real-time process did not have enough time for them.  They have not yet received a response.  Per her request, I have sent this list of questions to Deb Dennis, and hopefully we will be hearing more from the lawyers and/or the Board soon to answer them.

I was not able to take notes on the content of the lawyers’ presentations, so this is by no means a full summary of the meeting.  If someone else did take notes and would like to offer a summary, either from this meeting or the member-worker-led meeting afterward, that would be very welcome.

Questions generated at the beginning of the meeting:

  • Why did the Board hand-courier a letter to the NYSDOL?  What’s in the letter?  Can we have a copy please?
  • Can I get a standard written legal analysis of the risks and benefits relating to the member labor program?
  • Can we please hear about the time line of this issue coming into being?
  • How many is “several” and how many are active cases?
  • Please distinguish and discuss the Fleming case.
  • Attorneys: please identify who, if anyone, you personally knew from Honest Weight before you started to represent us.  Who from Honest Weight first made contact with you to represent us?  What were the problems they asked you to help solve?  Who from Honest Weight do you communicate with most regularly?
  • Has the coop prepared a cost-benefit analysis of MLP vs. traditional employees?  Can we see it?
  • You have cited a 1997 opinion letter – what is the relevance?  Coop under consideration in that letter was anonymous.  It cites a Maine case that is not similar to HWFC and there were 3 dissenting opinions.  What’s the relevance to HWFC?
  • Why is this happening now?  The expansion issues have been in process for years.
  • Authors of 2000 bylaws revision (including Saul, the speaker) were aware of the 1997 opinion letter.  Attorneys back then did not see a problem.  Have you spoken with the Board’s previous attorneys?  Have you considered the fiduciary implications of the Board’s action to draw DOL attention to HWFC, despite the risk mentioned in the FAQ #49 on the coop’s website?
  • Layman’s terms, please, for legal analysis requested above.
  • Is there a record of the analysis that led to the revision of bylaws process?  It appears based on language on website that the Bylaws Task Force was created with its mission already established based on a decision that changes to the MLP were necessary.

From here down, all of these questions were generated during or after the lawyers’ presentations.

Open process:
  • Can these questions please be answered in print and sent to all members with time to consider before the Special Membership Meeting?
  • Can we as the owners give our consent to accept the risks of transparent process and allow ALL relevant information to be accessible to all member owners?  Attempts so far to conduct this process without full disclosure have led to nothing productive.  I understand that the lawyers are trying to protect us when they advise against disclosure, but that’s not how a coop works.
 
Re: Economic realities test:
  •  Among the factors considered to evaluate whether someone is functioning more like an owner or more like an employee, participation in governance of the coop was notably absent from the list.  Why?  That should matter, right?
  • The changes that have been advocated by current leadership (decreased role of member labor, shareholder voting, and moving decision authority toward the Board) all appear to have the effect of making member workers more like employees and less like owners.  How has this been considered in the legal analysis to date?
Asking for creativity in defense of member labor:
  • To Joan Marie: What efforts have been made to be creative in finding legal interpretations that support the mission of the coop?
  • Why are the lawyers not presenting both pros and cons to member labor?
  • How do we find lawyers who will fight FOR the Member Labor Program?  If we need to change laws, how to we go about doing that?  How do we support the increase of Member Labor Programs nationally instead of participating in their decline?
  • Could we categorize floor workers as committee members, increase self-oversight of such groups to make us more like owners, less like employees?
  • Would it help to consider member workers as contractors?
  • Would it help to name member workers as interns?
  • If the MLP were to continue basically how it is now, but was revised so that member workers received value equivalent to minimum wage, would that solve the problem of potential risk, or are there other issues involved?
  • Would it help, in clarifying our status and/or reducing risk of activating legal action, if member workers sign something clarifying that we understand when we work as member owners we are not eligible for workers’ compensation, unemployment, or other benefits afforded to employees?
Asking for transparency re: the letter to DOL:
  • If the substance of the letter is in the Inside Scoop as you say, why not show it to us?
  • Deb Dennis was heard to offer at the last Board meeting that people who wanted to see the letter could come see her and look at it.  So why can’t we see it?  (When this was read aloud, Deb told the room she did not offer to show the letter.)
  • If there is specific sensitive information in the letter, could a redacted copy be shown to member owners?
  • Would the lawyers advise the Board against releasing the DOL letter?  If so, why?
The Times Union article:
  • How was the TU article initiated?  Who agreed that Bill and Lily could talk to them?
  • The board member who spoke to the TU caused irreparable damage.  Why has no action been taken against him?
 –
Is there really a problem?
  • We had a previous audit by the DOL.  The MLP was no secret and DOL expressed no concern.  Why would it be different in the future?
  • Historically, lawyers and agencies told us MLP was not of concern.  When did the shift occur, on whose initiation, and why?
  • Why are we proceeding with any option until we hear back from DOL?  It’s like we’re jumping before we have to.  It’s doubtful they will penalize us since we contacted them first.
Finances:
  • I have heard wildly conflicting accounts re: member liability if a suit is brought against the coop.  From members can have their houses, cars, and savings taken away to liability will be limited to our $100 share.  (1) Which is correct?  (2) How have cases in the past been settled?  Do members lose their homes and savings?
  • I’m confused by the issue of “minimum wage.”  My wife and I work for an organization for 16 to 20 hours per month.  Some months, we are paid $4.50/hour – other months, we have made over $16.00/hour.  We could conceivably make even more.  We are given a “check” every month, but we fill in the amount – it’s all up to us – we determing our “pay” by how much we shop at the co-op.
  • We were told of the “settlement” costs of other cases regarding underpaid member workers, but we don’t actually have the data that tells us what our exposure is specifically: exactly how many member workers who are most at risk (I was told 68% of 1200 workers) actually “make” less than minimum wage on a per hour basis?  This information is in the database at the coop and can be easily obtained but we have been told that it creates more risk to put it out to the membership.
  • How much are the attorneys being paid?  Were they paid for this meeting?
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2 thoughts on “Questions to the Lawyers

  1. I am so disappointed I could not make it to this meeting as I was out of town. I look forward to viewing the presentation at some point prior to the special membership meeting. Thank you for listing all the questions presented to the attorneys. To what extent are these lawyers obligated to supply responses? I hope we are not being billed for this time. I’d like to know that. These attorneys, in my opinion, have been actively participating in the violation of our bylaws by not recognizing from the beginning, “hey HWFC board, everything we are discussing needs to be transparent to the member owners per your bylaws.” They have acted as nothing less than personal attorneys for the board members and anyone else privy to their consulting time. Since member owners were not involved in the closed door meetings, HWFC should not have written a check to them. Now we are backpeddling with all these questions.

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  2. Colleen

    Rebecca,

    This is a great, and pretty darn thorough(!), re-cap of the questions/answers. I’m not sure how you were able to keep up with all that was happening.

    Also, it was nice to put a face to a name — and, thank you — I very much enjoyed our conversation. We all want the best for HW and I’m counting on that to bring us through this — stronger, wiser and a shining example to the Co-op Community (and those traditional stores) of how it works.

    Colleen

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