Nonprofit, Founder Ordered To Pay Employee After Racist Rant

A federal jury in New York ruled that a nonprofit and its founder must pay a former employee $280,000 after she was subjected to a rant using racial slurs.

According to a report on CNN.com, the ruling stems from a lawsuit filed by Brandi Johnson against STRIVE, an employment center in East Harlem section of Manhattan. Johnson claimed in her suit that STRIVE’s founder, Rob Carmona, repeatedly harassed her, culminating in a rant that used slurs against African-Americans. Johnson, who is black, said in court that the incident was the last straw for her. She sent a formal complaint to the organization’s CEO, Phil Weinberg on April 11, 2012 but was allegedly told that she was being "out of line" and "emotional."

Johnson was fired two months later, which she alleges was done as retaliation for her complaints.

The jury ruled Tuesday that Carmona, who founded STRIVE in 1984, must pay Johnson $25,000 and the organization must contribute $5,000 in punitive damages. This comes a week after jurors awarded Johnson $250,000 in compensatory damages.

"We are disappointed by the verdict, as we do not believe that it comports with the full facts applicable to the case," said Carmona's lawyer, Diane Krebs, via a statement. "Nevertheless, we respect the jury's decision and the judicial process. We are exploring all our options moving forward, including appeal, and look forward to the judicial process taking its entire course."

While testifying last Friday Carmona, who identifies as black and Hispanic, tearfully tried to explain his actions. He explained, "I come from a different time." According to STRIVE, Carmona spent his early teenage years in Harlem addicted to drugs and in and out of prison. He found solace in an alternative incarceration program where he cleaned up and eventually attended college. The center's website says that it has helped nearly 50,000 individuals across America enter the workforce.

For her part, Marjorie Sharpe, Johnson's attorney, called the decision "important" because it is the first case where "we essentially have the n-word on trial."

"There are a number of cases where the n-word has been used in a workplace, but usually it's been done between people of different races, and when we're having that discussion, it seems that it's clear that if you're not African-American and you use the n-word, absolutely it's insulting," continued Sharpe.

You can read the full story on CNN's website.

4 'ObamaCare' Actions To Take Now

Many of the provisions of the Affordable Care Act -- so-called ObamaCare -- will be going to affect in the coming year. Despite its potential benefits for Americans, the law does pose some issues for employers. 

During the AICPA Not-for-Profit Industry Conference, Eddie Adkins of Grant Thornton and Cheryl Press of Tax Exempt and Government Entities (TEGE) at the Internal Revenue Service (IRS) discussed how employee benefits and compensation are affected by healthcare reform, particularly when it comes to full-time and part-time employees. They reminded listeners that the IRS has rules defining exactly who is and who is not a full-time employee, and those rules are complex.

What can nonprofits do to prepare for these regulations? Adkins and Press said that action should be take now, not later. Specifically, they recommended taking the following steps:

• Take time to thoroughly understand the details in the regulations. With complexity comes the chance of misunderstanding or misinterpreting. A few details could make a difference. 
• Convene a meeting of all stakeholders, including individuals responsible for health plans inside and outside the organization. This includes the employee benefits director, the insurance broker and legal counsel.
• Discuss the details of the rules and how they apply to the organization, and identify changes that might be necessary to avoid mandated excise taxes. 
• Follow through with proper implementation.