Daily Archives: August 5, 2013

If you are considering supplementing or replacing your in-house data storage with cloud computing, you need a comprehensive risk management strategy to protect against cyber risk that can expose your company to substantial financial losses and reputational harm.

Before you decide to send information to the cloud, you should assess the impact of a loss or theft of that data on your internal operations and client / customer relations.  Assessment should be made by risk management and information technology personnel, together with senior-level management and supervisors of employees who are most likely to send data to the cloud.

Cloud service providers typically will offer you little or no contractual risk protection in their contracts. It is therefore important to address the potential losses resulting from data breach or service outage by securing cyber liability insurance coverage from an insurance company that specifically includes cloud-based services in their policy forms.                       

Storing data in the cloud can be very advantageous.  However, before you start transferring information, it is important that you carefully plan your cloud computing objectives and secure insurance that protects your exposure to cyber risk. 

This information is not intended to be exhaustive nor should any discussion or opinions be construed as legal or financial advice. Readers should contact legal counsel or their CPA for legal tax advice.

In June 2013, a federal district court in New York issued a decision regarding unpaid interns that should cause employers across the country to think about whether their interns are paid correctly. The rules surrounding unpaid internships aren’t new. The Department of Labor issued information for employers on this topic as recently as April 2010, but that information is based on existing rules. However, many employers may not be aware of these rules and how they affect hiring unpaid interns.

In this case, Glatt v. Fox Searchlight Pictures, Inc., the court ruled that unpaid interns at Fox Searchlight Pictures Inc. (Searchlight) should have been classified and paid as employees. The court ruled that Searchlight violated the Fair Standards Labor Act (FLSA) and New York state labor law when it didn’t pay two production interns for work done on the set of the movie “Black Swan.”

The court also certified a class action against Fox Entertainment Group, Inc. (FEG), allowing a similar lawsuit to proceed alleging that FEG violated New York state labor law when it didn’t pay its interns as employees. The class action will go forward on behalf of all individuals who had unpaid internships between Sept. 28, 2008, and Sept. 1, 2010, with one of several divisions of FEG.

 Click here for information on the rules that apply to internship programs and circumstances that led to liability for Fox Searchlight, which intends to appeal the case.

 This information is not intended to be exhaustive nor should any discussion or opinions be construed as legal or financial advice. Readers should contact legal counsel or their CPA for legal tax advice.