Labor & Employment Law Daily Wrap Up, CONTRACT CLAIMS—S.D.N.Y.: Employee shows that working remote from Israel not breach of material term of employment contract, (Jul 29, 2025)

By Ronald Miller, J.D.

The magistrate concluded that a reasonable jury could find that the employee’s having worked in Israel was a non-material breach that did not affect the agreement’s “central purpose.”

A federal district court in New York adopted the recommendation of a magistrate judge to deny an employer’s motion for summary judgment against an employee’s claim that it breached an employment agreement by failing to pay compensation due under the contract. The employer claimed that the employee materially breached the agreement by working remotely from Israel, rather than its New York office. However, the court found that the employee adduced sufficient evidence to show that working in the office not a material term of his employment contract (Spiegler v. Mish Mish Inc., No. 22 Civ. 8774 (PAE) (S.D.N.Y. July 28, 2025)).

Technology start-up. The employer is a technology start-up company, with its principal place of business in New York. The employee is a citizen of Israel. At the time he began working for the employer, the employee was in the United States on a K-1 Visa.

In April 2019, the employee began performing computer technology services for the employer without an employment agreement. He worked out of a WeWork remote office location leased by the employer in New York City.

Nonimmigrant visa. The employee advised the employer that were he to continue working for it in the United States the company would need to sponsor his employment visa. The employer agreed to do so.

On December 15, 2019, the parties executed a written employment agreement. It provided that the employee’s employment was contingent upon his receipt of a nonimmigrant visa to the United States, and that the employer’s failure to sponsor the visa would terminate the agreement.

Employment agreement. Under the terms of the agreement, the employee’s core responsibility included planning and building the company’s platform, including the technical infrastructure, administrative tools and client facing applications, scaling the platform for growth of the business, and hiring, training, and managing a team of engineers and data scientists. The agreement set the employee’s compensation at $240,000 per year. Although he was paid some portion of that sum, he was paid less than the agreement provided for.

Additionally, the agreement identified the employer’s “primary office” location as the WeWork office location at which the employee initially provided services for the employer. But the lease for the office space expired on September 30, 2019, before the date of the agreement. Between October 1, 2019, and February 29, 2020, the employer leased a different WeWork office space. Thereafter, the employer leased office space at two other locations. After the final lease expired in summer 2020, the employer never signed another lease.

In December 2019, shortly after entering into the agreement, the employee traveled to Israel. On February 26, 2020, he received his nonimmigrant visa. However, he did not return to the United States until October 2023. The employee asserted that he had booked a flight to New York in February or March 2020, but that flight was cancelled because of COVID.

While the employee alleged that he performed all the work the employer gave him, the employer countered that he did not complete his work in a timely manner. It further asserted that it was difficult to collaborate with the employee with his working outside New York. In September 2020, the parties terminated the working relationship.

Breach of contract claim. On October 14, 2022, the employee brought suit against the employer for violations of the New York Labor Law and breach of contract. After completion of discovery, the employer moved for summary judgment on the breach of contract claim.

The report of a magistrate judge noted that the materiality of the breach is generally a mixed question of law and fact and thus was not properly disposed of by summary judgment. The magistrate further found that the employee adduced evidence on which a reasonable jury could find that his breach of the contractual requirement that he work in the employer’s New York office was not material.

This evidence included that on the date the agreement was signed, the employer lacked a dedicated New York office at the address listed in the agreement. The employee was working remotely when he left for Israel. There was evidence the employee performed each task to which he was assigned; and the agreement itself permitted work from home “as needed from time to time.” The report also found that a jury could find, based on the COVID pandemic during 2020, the employee’s failure to go to New York was not willful. Thus, the report concluded that a reasonable jury could find that the employee’s having worked in Israel was a non-material breach that did not affect the agreement’s “central purpose.”

Remote work. It was undisputed that the agreement required that the employee work from the employer’s “primary office;” and that between December 2019 and September 2020, when he ceased working for the company, he did not do so—he worked remotely from Israel. Thus, the employer’s summary judgment motion turned on whether a reasonable jury would have found that the employee, in not complying with that term, to have materially breached.

A material breach is one that goes to the root of the agreement between the parties. In evaluating whether a breach was material, courts consider factors such as the “ratio of the performance already rendered to that unperformed,” the “degree to which the purpose behind the contract was frustrated,” and “extent to which the aggrieved party has already received substantial benefit of the promised performance.”

Here, the court found that this term was not material under the agreement. The materiality of a contract term must be evaluated in the context of the overall agreement.

The magistrate recognized that the evidence supplied a solid basis upon which a jury could conclude that the employee’s breach of the agreement’s location provision did not strike at the “root” of the agreement between the parties. For one, the employer did not maintain offices at the location cited in the agreement at the time it was executed or at any time thereafter. Thus, the employee could not have complied with the “place of Services” provision as written.

Moreover, the test of the agreement expressly contemplates remote work. It authorized the employee to work “from virtual offices” as needed from time to time. Thus, a reasonable jury could find that physical presence was not necessary to the employee’s effective discharge of his work obligations, that both parties anticipated flexibility in work arrangements, and that the physical-presence provision was included to give the employer the capacity to order the employee to be present in person from time to time.

Contract formation. Further, the court rejected the employer’s contention that the agreement was entered into to help the employee to obtain a visa permitting him to work in the United States, such that his relocation undermined representations it made to immigration authorities. The employer’s sponsorship of the employee’s employment visa did not establish that physical presence in the employer’s New York office was important to it. Thus, a jury could find that the parties’ conduct after the formation of the agreement did not support the requirement that the employee work in New York was nonmaterial.

Accordingly, the court adopted the magistrate’s recommendation to deny the employer’s summary judgment motion.

The case is No. 22 Civ. 8774 (PAE).

Judge: Engelmayer, P.

Attorneys: Frank J. Tantone (Lipsky Lowe) for Gal Spiegler. Elliot Hahn (Hahn Eisenberger) for Mish Mish Inc.

Companies: Mish Mish Inc.

Cases: ContractClaims WageHour StateLawClaims Immigration Covid19 NewYorkNews