Employment Law Blog

What do you do when “Love is in the Air” at work?

M. Cheryl Kirby — Wed, 12 Jun 2013 00:00:00 -0500

Most employers are all too familiar with potential liability associated with sexual harassment in the workplace. Since employees are only human, and physical attraction between the sexes is inevitable, what’s an employer to do when an office romance is in full bloom?

Some employers, according to the size and organization of the business, have policies that require at least one of the love birds to resign. Even though the policy may be neutral on its face, it will not prevent the “resignee” from complaining to the EEOC that the employer pressured him/her to resign because it preferred to “keep” the other half of the pair because of his/her sex.

When employers don't have a policy addressing office romances, they may allow both to continue their employment, sometimes asking each to sign a statement confirming the affair is mutually consensual. Everything seems rosy until the affair goes south and one of two cries “sexual harassment.” The claim may go something like: “I had to sign that statement about the affair or be fired. The affair wasn’t really consensual - I had to do it to keep my job.” Unfortunately, stories tend to change when the "bloom" falls off the rose.

Another risky scenario for the employer involves the "jilted" supervisor who had an affair with his subordinate. Although it is human nature to try to win back the lost lover back, if the supervisor takes that course, it may lead straight to a sexual harassment charge by the “jiltor.” On the other hand, it is also human nature for the “jilted” lover to retaliate - which would also be a lawsuit waiting to happen.

There simply is no easy answer to the question posed in the title - in large part because the workplace love “bloom” usually fades and the employer is left "holding the bag."

Perhaps the safest route to avoid being sued for sexual harassment arising from a workplace affair is to terminate both participants as soon as the affair comes to light. There are obvious disadvantages to such drastic action, not the least of which may be the loss of one or two very valuable employees.

The bottom line is that workplace romances are a source of potential liability for an employer, regardless of whether the employer has written policies in place, so employers should analyze the situation objectively and consider seeking professional legal advice before taking any action.

Keep Your Reference Check in Check

Katie Anderson — Tue, 28 May 2013 00:00:00 -0500

Many experienced Human Resource professionals agree that many problem employees and unhappy terminations can be avoided with more thorough research during the hiring phase. A good job on the front end can avoid a crisis on the back end. In addition to interviews and background checks, reference checks are invaluable and usually worth the time and money spent. Additionally, all documents and information obtained during the reference check can help defend any later claim for negligent hiring if the employee engages in behavior that leads to claims by third parties, such as violence.

Who should make the call?

An initial step is identifying who should conduct the check. While HR should be involved and oversee the process, the supervisor or manager who will ultimately directly oversee, evaluate, and interact with the candidate if selected may want to conduct the check. A supervisor may have more success getting the candidate’s former supervisor on the phone. A supervisor may get a feel for if the person will be a fit and will have a personality that will thrive in that workplace during the reference checking process. Finally, the supervisor will also be more invested in the candidate’s success if they are part of the hiring process, which makes for a healthier work environment.

How do we get them to talk?

The true challenge is getting a reference to talk honestly and openly. When you find someone is hesitant to do so, you might encourage them to feel more comfortable by citing them to the law that offers protection. In Texas, an employer may disclose information about a current or former employee's job performance to a prospective employer that the employer reasonably believes to be true. Employers are immune from any civil liability for making disclosures about current or former employees’ job performance unless it is proven by clear and convincing evidence that the information disclosed was known (actual, including any information maintained in a file by the employer) to be false at the time the disclosure was made or that the disclosure was made with malice or in reckless disregard for the truth or falsity of the information disclosed. Notably, these rules apply not only to the employer (entity) but also apply to a managerial employee (individual) who is authorized to provide and does provide this information.

Another tactic might be to have the candidate sign a release so that the former employer is comfortable discussing the prior employment. Alternatively, you might consider requesting that the candidate communicate with the reference and encourage the reference to contact you directly to provide information.

What should be asked?

The best questions are open-ended questions that give the reference an opportunity to give detailed answer about the candidate. At a minimum, the education and employment history of the candidate should be confirmed. Some of the real value of the reference might be found in asking these questions:

1. Verify the candidate's dates of employment, titles, and roles. Is the candidate eligible for rehire? Why or why not? What was his reason for leaving?

2. What were the responsibilities of the candidate while working for you and did those vary over time (i.e. increase or decrease). Did he complete them satisfactorily? Did he go above and beyond what was required of him without being asked?

3. Did the candidate timely complete assignments and was the work accurate and in line with expectations?

4.What were the candidate's strengths as an employee? Would you describe him as _______________ (insert what is important to you for the position – a hard worker, able to handle pressure, willing to take the initiative, organized, communicative, etc.)

5. Is the employee a team player or does he work better independently? Did the employee get along well with her peers? With managers? With customers? How closely was the applicant’s work supervised?

6. Read a brief job description of the position the candidate is being considered to fill. Do you think the candidate is qualified to assume these responsibilities? What specific qualities or personal characteristics cause you to feel this way?

7. What opportunities for development or improvement were communicated to the candidate and how did he respond?

8. Was the employee punctual and reliable? Were there any issues with tardiness or absenteeism?

9. Do you have any reason to believe that the applicant might present a danger to others or cause disruption of the work environment?

10. Should I hire this candidate?
Of course there are no magic questions and no easy answers. However, time and energy spent learning as much relevant information from a candidate’s employment past is usually time and energy well-spent. So, take some time to check your reference check procedures and update them as needed to learn what you can.

___________________________

1 "Employer" means a person who has one or more employees or other individuals who perform services under a contract of hire or service, whether expressed or implied, or oral or written. TEX. LAB. CODE §103.002(2).

2 "Job performance" means the manner in which an employee performs a position of employment and includes an analysis of the employee's attendance at work, attitudes, effort, knowledge, behaviors, and skills. TEX. LAB. CODE §103.002(3).

3 TEX. LAB. CODE §§103.003(a).

4 TEX. LAB. CODE §103.004(a).

5 TEX. LAB. CODE §103.004(b).

Must You Pay Employees When Disaster Strikes?

Monica Velazquez — Fri, 17 May 2013 00:00:00 -0500

The recent tragedies in Boston and in West, Texas, remind us how our lives can change in an instant. In the blink of an eye, lives are lost, homes are destroyed, livelihoods are forever changed, and the selfless acts of kindness of strangers and neighbors become paramount. Amidst the devastation, Mr. Rogers purportedly said, look for the helpers. As a business owner, you try to do your small part to help and reach out to your community in need. As an employer, however, can you afford to be such a good helper?

Many employers forget that when natural or man-made disasters strike, some of their obligations as employers are not put on hold. If your employees miss work due to disasters or police lockdowns, are you obligated to pay them for the work days they miss?

Under the federal Fair Labor Standards Act (FLSA), exempt employees are paid on a salary basis and are not subject to reductions of their salary because of a workplace closure that lasts less than a full workweek. If the closure of the workplace lasts longer than a full workweek, then an employer is not obligated to pay those exempt employees who perform no work during full workweeks. Beware because improperly docking an exempt employee’s salary can jeopardize his exempt status and expose you as an employer to liability under the FLSA. However, if your workplace is open and an exempt employee misses a full day of work for personal reasons – for example, because she is volunteering at the Red Cross – then her salary may be reduced by a full day’s pay. Given the emotional charge surrounding such tragedies, however, consider whether docking an employee’s pay under such circumstances is truly a wise decision. Simply because federal law allows the deduction, it doesn’t mean your community won’t punish you for it in the court of public opinion. After all, you don’t want to be penny-wise and pound-foolish.

In the case of non-exempt or hourly employees, the rules appear easier. Under the FLSA, you are only required to pay non-exempt employees for the hours they actually work. Therefore, if your workplace was open but non-exempt employees did not show up to work because of a disaster or police lockdown, you don’t have to pay them. However, be careful if you have employees in other states where reporting pay is mandatory. Several states have reporting pay laws – where employees are paid a number of hours if they report to work for their scheduled shift, even if they perform no work. In those states, if the employee shows up, if only for 10 minutes, and there is no work for him, the employee is nonetheless entitled to a minimum payment of wages. The states which have mandatory reporting pay include: California, Connecticut, Massachusetts, New Hampshire, New Jersey, New York, Oregon (minors only), Rhode Island, as well as the District of Columbia. In Massachusetts, for example, employees who reported to work for scheduled shifts longer than three hours even when no work was available could be entitled to receive at least three hours of pay at the state minimum wage of $8.00 per hour.

While Texas does not have mandatory reporting pay laws, it is important to know what your pay obligations are ahead of time. When disasters disrupt businesses and paralyze our cities and towns, employers can do their small part to help out by abiding by their pay obligations to employees.

Has the Supreme Court Approved of “Picking Off” Collective FLSA Actions?

Tiffany G. Hildreth — Fri, 19 Apr 2013 00:00:00 -0500

Yesterday, the U.S. Supreme Court issued its Genesis HealthCare Corp. v. Symczyk decision, holding that a putative collective action under the Fair Labor Standards Act (FLSA) may be mooted and dismissed where the defendant employer offers to fully satisfy the claims of the named employee plaintiff prior to the class being certified.

The plaintiff had filed a FLSA action on behalf of herself and “other employees similarly situated.” The defendant tendered an offer of judgment under Federal Rule of Civil Procedure 68 which fully satisfied her individual claim prior to any other persons joining her suit. The District Court held that her suit was moot and dismissed it for lack of subject-matter jurisdiction. Although acknowledging that the plaintiff’s individual claim was moot, the Third Circuit reversed and remanded the case to the District Court to allow her to seek “conditional certification,” which, if successful, would relate back to the date of her complaint. The Third Circuit explained that allowing defendants to “pick off” named plaintiffs before certification by making Rule 68 offers would frustrate the goals of collective actions.

The Supreme Court disagreed and held that the case had been properly dismissed for lack of subject-matter jurisdiction.

The Court explained that a plaintiff whose individual claim is moot has no personal interest in representing others in the action. It then rejected several attempts by the plaintiff to circumvent this outcome.

First, it found that the putative class had no possible independent legal status because the plaintiff had not moved for conditional class certification by the time her own claim became moot and, in any event, under the FLSA, “conditional certification” does not produce a class with an independent legal status.

Next, the Court disagreed that a FLSA collective action could be viewed as an “inherently transitory” class action claim which could survive termination of the named plaintiff’s claim. The “inherently transitory” rationale addresses different issues that usually involve the fleeting nature of the challenged conduct underlying the claim, not the defendant’s litigation strategy. Damages claims cannot evade review, nor can an offer of full settlement insulate such a claim from review. Although the putative class could no longer join the plaintiff’s suit, they could still initiate their own suits since their claims still existed.

Last, the Court rejected the idea that the defendant’s use of Rule 68 had frustrated the purpose of the FLSA’s collective-action provisions. The prior U.S. Supreme Court case that the plaintiff used to support this argument involved Rule 23 class certification decisions, not collective actions under the FLSA, and the “picked off” plaintiffs in that case had a continuing interest in the controversy - to shift a portion of attorney’s fees and expenses to successful class litigants. The plaintiff in this case had received complete relief and did not assert a continuing economic interest.

You Heard Right – Partial Hearing Loss is not always a “Disability”

Katie Anderson — Thu, 18 Apr 2013 00:00:00 -0500

Many Americans suffer from hearing loss. According to the Journal of the American Medical Association, age-associated hearing loss is the most common cause of hearing loss in older adults, and, in 2008, 31% of Americans older than 65 years had the condition and 70% older than 85 years did. When and how that loss can be considered a “disability” under the Americans with Disabilities Act (ADA) depends on a number of factors.

The EEOC has determined that “deafness substantially limits hearing,” that hearing is a major life activity, and therefore a deaf person is disabled. 29 C.F.R. § 1630.2(j)(3)(iii). However, partial hearing loss is not always covered.

A federal judge in Pennsylvania recently granted summary judgment for a newspaper that had terminated a copy editor with hearing loss in one ear as a result of a surgery to remove a brain tumor. Christine Mengel v .Reading Eagle Company, Civil Action No. 11-6151 (E.D. Pa. March 28, 2013). The evidence showed that Ms. Mengel was able to continue performing her job functions without accommodation but had difficulty concentrating.

To present a prima facie case of discrimination under the ADA by demonstrating:

(1) she is disabled within the meaning of the ADA;
(2) she is otherwise qualified to perform the essential functions of the job, with or without reasonable accommodation by the employer;
(3) she has suffered an otherwise adverse employment decision as a result of discrimination

Ms. Mengel failed to present evidence that hearing loss in one ear substantially limited her hearing. In fact, she admitted that her hearing loss was not a distraction, and she did not mention any specific instances where her hearing loss caused a problem other than that she “didn’t hear some things.”

The newspaper could still have been liable because the court held there was sufficient evidence that she may have been regarded as disabled. However, she did not produce evidence of a causal link. Her medical condition began in 2007, after which she received a favorable performance evaluation and was not terminated until 2009. The court found the separation was not casually related.

Employers should be careful not to discriminate against those with hearing impairments and should, as always, document performance in a fair and objective manner.

__________________________________________
1 (http://jama.jamanetwork.com/issue.aspx?journalid=67&issueid=22494; Vol. 307, No. 11 03/12/2012).

Pope May Sometimes be Infallible but Conception isn’t – When can a religious school fire a teacher for not following the faith?

Katie Anderson — Tue, 02 Apr 2013 00:00:00 -0500

Emily Herx, a Catholic-school teacher sued the Diocese of Fort Wayne-South Bend and the St. Vincent de Paul School after her contract was not renewed. She received news of her job ending shortly after she discussed undergoing in vitro fertilization (“IVF”). She claims discrimination based on her gender (female) and her disability (infertility) after she was told she was not being retained due to “improprieties related to church teachings.” Her contract required her to conduct herself at all times in accordance with the “teaching authority, law and governance of the Church in this Diocese.” The Catholic Church teaches IVF is immoral.[1]

The defendants filed a motion to dismiss, citing exceptions to federal employment laws (Title VII and the Americans with Disabilities Act) for religious employers and claiming a First Amendment right to freedom of religion. The diocese claims that the lawsuit challenges the diocese’s right as a religious employer, to make religious based decisions consistent with its religious standards. On March 11, 2013, the United States District Judge Robert L. Miller, Jr. refused to dismiss the case. The court lifted a stay on discovery.

Churches have long enjoyed the protection of “the ministerial exception” which prohibits ministers from suing their churches over most employment disputes. While the term “ministers” includes pastors, priests, and rabbis, it is not clear whether or to what extent parochial teachers are also included.

In Hosanna-Tabor Evangelical Lutheran Church and School v. Equal Employment Opportunity Commission,[2] all nine Supreme Court justices agreed that “the Establishment Clause prevents the Government from appointing ministers, and the Free Exercise Clause prevents it from interfering with the freedom of religious groups to select their own.” There, the Court found a teacher who taught religion was a “minister” for purposes of this exception.

On the other hand, Herx was a language arts and literature teacher who never taught religion. This case will be one to watch for potential precedent on the parameters of rights for employees and employers in religious institutions. The issue is particularly interesting during a time when Catholic institutions around the country have sued to challenge the no-cost birth control mandate of Obamacare as unconstitutional[KA1] .[3]

[1] The Bishop refused to renew Herx’s contract, stating (as cited in court documents) that “The process of in vitro [sic] fertilization very frequently involves the deliberate destruction or freezing of human embryos,… and is an intrinsic evil, when means no circumstances can justify it.” Herx v. Diocese of Fort Wayne-South Bend, et al, Case No. 1:12-CV-122-RLM-RBC in the U.S. District Court for the District of Northern Indiana. See also http://www.americancatholic.org/messenger/jun2009/wiseman.asp.

[2] 566 U.S. __ (2012)

[3] http://www.strasburger.com/blogs/generic-search/696/1/who-has-final-say-over-who-has-to-pay-for-birth-control-

[KA1]

Right Job Description and Right Questions Leads to the Right Employee

M. Cheryl Kirby — Mon, 25 Mar 2013 00:00:00 -0500

Before advertising for a position you need to fill, take time to evaluate the position itself and the qualities and skills a person would need to do the job. Providing a clear job description with a list of applicable qualities and skills and qualities gives applicants a sense of whether they are suited for the job without overwhelming them, and it also helps you develop the right interview questions to pinpoint the right person for your organization.

A well-drafted job description includes not only the job duties, but also personal characteristics and/or qualities that are necessary to perform the job well. For example, in some jobs, punctuality is essential while in other jobs flexibility will be more valuable. Some jobs require lots of communication and personal interaction while others do not. All too often, however, job descriptions rely on "standard" phrases such as "good communication skills required,” when, in truth, very little personal interaction is needed. Such over-drafting of skills and qualities could easily discourage an individual with the perfect skill set for the job from applying in the first place.

It is also important to develop interview questions that allow you to identify essential characteristics and qualities to determine if the job candidate will fit into the organization’s culture. Of course, you must do this without treading into areas that are off limits. For example, you don't want to ask questions that would prompt the applicant to reveal information that will put you on notice that the individual is in a category protected by discrimination laws, i.e., has a disability, because you may then have to justify a decision not to hire this individual.

Remember, you are looking for the right fit, not a perfect person. There is something to be said for your gut feeling, so if it doesn’t sound right or feel right, it might not be right for your organization. However, having a clear job description and asking the relevant questions can go a long way toward helping you select the right person for the job.

HOW MUCH TIME (AND $$) DOES IT TAKE TO CHANGE CLOTHES?

Katie Anderson — Fri, 08 Mar 2013 00:00:00 -0500

While many of us may consider the phrase “changing clothes” to be somewhat self-explanatory, such is not the case in the world of employment law, where things are not always so obvious. Consequently, in Sandifer v. United States Steel Corp., the U.S. Supreme Court has agreed to consider what this phrase means in the context of the Fair Labor Standards Act (FLSA).

Under Section 203(o) of the FLSA, time spent "changing clothes" can be excluded from working time, and therefore unpaid, if:

1) the employees agree to this in a collective bargaining agreement or

2) there is a long history of non-payment in the industry and the employees knew about and agreed to the practice.

Eight hundred (800) union workers say they should be compensated for “changing clothes” when it comes to changing in and out of their safety gear. Wearing safety gear is a key part of their job, and they spend a lot of time changing in and out of it due to the size of the plant, the location of the locker room, and the complexity of the gear itself. The collective bargaining agreement in place is silent on the issue. The Seventh Circuit Court of Appeals found the workers were not entitled to compensation, but other appellate courts around the country are in conflict.

The high court’s decision will impact those industries that have requirements for changing clothes or wearing personal protective equipment, especially when the requirements require or encourage that changing to take place on the work premises. Some industries that might be directly impacted include these:

- food processing

- chemical plants

- manufacturing plants

- construction

- health workers

The Supreme Court decision is expected during next term – October, 2013 – June, 2014. We will be watching for it so we can update you on the opinion.

WHAT YOUR EMPLOYEES SAY ABOUT YOU CAN GET YOU SUED!

Francine W. Breckenridge — Wed, 06 Mar 2013 00:00:00 -0500

In Johnson v. Maestri-Murrell Ppty. Mgmt. LLC, Ms. Johnson applied for an assistant manager position at an apartment complex. The apartment complex catered to mostly white college students and Ms. Johnson was African-American. One of the apartment complex employees said that the apartment complex manager did not think that the owners of the complex would want a black assistant manager because the parents of the white students would object. The apartment manager never interviewed Ms. Johnson and hired – you guessed it – a white woman to fill the assistant manager position.

Ms. Johnson filed a discrimination suit against the apartment owners, and the apartment owners filed a summary judgment motion. The district court granted the summary judgment, accepting the apartment owner’s argument that Ms. Johnson did not have experience in managing apartments. (Notably, the white female who was hired had even less experience than Ms. Johnson.) The district court held that Ms. Johnson “failed to demonstrate that the decision to hire [the white female applicant] was made after the occurrence of the alleged discriminatory comment,” so there was no causal connection between the remark and the apartment owner’s selection of the white candidate.

The 5^th Circuit, with a very conservative panel, disagreed, reversing the district court’s ruling. The Court held that the relevant question was whether or not discrimination prevented Ms. Johnson’s consideration for the job. If the remarks of the apartment complex employee were true, there was evidence of discrimination. The timing of the comments were not as important as the content of the comments. The Court reasoned that deciding whether unlawful discrimination was involved in making the employment decision was the determinative fact.

Lesson learned? If company owners or higher level managers have any biases against any protected class, keep your big mouths shut. Your mom was right – if you can’t say something good about someone, don’t say anything at all. No good comes of sharing discriminatory or racist comments at your workplace.

Life’s Not Fair…Yet

Allison Reddoch — Thu, 14 Feb 2013 00:00:00 -0500

Like all other parents, I was so excited when my son started talking, despite “Dada” being his first word. However, six years later, I can’t help but be nostalgic for those long-gone days of blissful silence. Now my days are filled with “But why?” and “That’s not fair!” My only “comfort” in these conversations is knowing that I’m teaching my child an invaluable lesson – that, sadly, life’s not always fair.

No one has lived this mantra more publicly than Lilly Ledbetter, the Goodyear employee who learned after 20+ years of employment that she was paid significantly less than her male counterparts. Her equal-pay lawsuit was ultimately decided by the United States Supreme Court, which held that the 180-day statute of limitations for presenting an equal-pay lawsuit begins on the date that the employer makes the initial discriminatory wage decision, not at the date of the most recent paycheck. This decision was, however, subsequently abrogated by the Lily Ledbetter Fair Pay Act of 2009, which specified that a discriminatory compensation decision or practice occurs with each unequal paycheck if the discrepancy is due to a discriminatory decision or practice.

The Act, however, only applied to claims brought under Title VII, the federal anti-discrimination statute. The Texas Supreme Court, in August of last year, held that the Act does not apply to claims made under TCHRA, the state’s anti-discrimination law, despite it being modeled on Title VII. In a 7-2 decision, the court held that because TCHRA does not exactly match the federal statue, the court cannot add a requirement that has not been explicitly adopted. The court further suggested that the legislature should act to amend the code to conform to federal policy.

Two Texas lawmakers have heeded the court’s suggestion. A pair of bills introduced in the Texas House and Senate propose changes to the state’s anti-discrimination laws to conform to the federal Act. Specifically the proposed changes would classify each paycheck based on a discriminatory pay scheme as a new violation of the law, essentially restarting the clock for employee complaints. The Legislature has twice considered similar proposals, however this time the recovery is limited to two-years of back pay, possibly making the proposed changes more agreeable.

While the bills have begun the journey towards becoming law, Texas employers need not worry unnecessarily. It is unlikely they will see an uptick in the number of equal-pay lawsuits filed if these changes are adopted as no such increase was seen when the federal Act was passed in 2009. A Texas version of the Lilly Ledbetter Act would arguably be a move toward making pay determinations a bit more fair.

Handle with Care: Discharging an Employee

M. Cheryl Kirby — Thu, 07 Feb 2013 00:00:00 -0500

No one likes to deliver the “pink slip” in the office, but like it or not, terminations are part of doing business. Before you start typing up the termination papers, however, make sure you dot your “I”s and cross your “T”s because lack of preparation may result in mistakes that can cost you in the end.

Most employers recognize that terminations go better if the proper groundwork is laid - sound written policies and procedures in place that are consistently followed by the employer. This allows employees to know what is expected of them and what the outcome will be if they do not comply with policies and procedures. But even when you’ve been diligent in following your policies and procedures, a termination conducted badly can lead to a lawsuit.

One common mistake employers make is delaying the actual termination after the decision has been made. Once the decision has been made to terminate an employee, the employer should act promptly. If you wait for the “right time,” you may run into problems. For example, the employee may get wind of what’s coming and become disruptive or try to set up a “retaliation” lawsuit against you.

Next, it is essential to prepare for termination by having a plan in place. You should know what you are going to say, what questions you can answer and how you will answer them, and have any paperwork involved with the termination already prepared.

Finally, at the moment of termination, remember that you are there to inform the employee of the termination decision - not to debate the decision. The employee should be treated with respect and dignity, but you should not make any promises you can’t keep or make excuses for terminating the employee. It is best not to say too much and wind up saying the wrong thing. The process should not take long if you are prepared and stick to the matter at hand.

Termination is not fun for anyone, but in business it is sometimes necessary. With a positive attitude and proper preparation, the termination of an employee can be handled in a professional manner that will leave the employee with his dignity intact.

The FMLA – It’s Not Just for Kids

Katie Anderson — Mon, 28 Jan 2013 00:00:00 -0500

Young children aren’t afraid to ask for (actually, demand) their parents’ help without any thought to repercussions. Adults sometimes need the same unconditional help from their parents. Thankfully, many laws acknowledge the extraordinary ties between parent and child. One important law that gives rights to parents to help care for disabled adult children is the Family Medical Leave Act (“FMLA”).

The FMLA entitles an eligible employee to take up to 12 weeks of unpaid leave to care for a “son or daughter” (among others) with a serious health condition. 29 U.S.C. § 2612(1)(C). Although the FMLA broadly defines a “son or daughter” to include a “biological, adopted, or foster child, a stepchild, a legal ward, or a child of a person standing in loco parentis” (those standing in the shoes of the parents by having day-to-day responsibilities to care for or financially support a child), it does not explicitly confirm that employees have leave rights to care for a son or daughter over the age of 18.

The Department of Justice (“DOJ”) recently clarified that FMLA leave may be available to employees needing to care for adult sons or daughters if all of the following apply:

(1) the adult child has a disability as defined by the ADA;

(2) the adult child is incapable of self-care due to that disability;

(3) the adult child has a serious health condition; and

(4) the adult child is in need of care due to the serious health condition.

To meet element # 2, an employee must show that the adult son or daughter “requires active assistance or supervision to provide daily self-care in three or more of the ’activities of daily living’ or ‘instrumental activities of daily living.’” Non-exclusive examples include caring for one’s grooming and hygiene, bathing, dressing and eating, as well as cooking, cleaning, shopping, taking public transportation, paying bills, maintaining a residence, using telephones and directories, using a post office, etc.

Importantly, the DOJ also explained that the age of the onset of the disability is irrelevant. The analysis must be conducted at the time the leave is requested.

Thus, employers will need to consider this clarification as employees request FMLA leave to care for a son or daughter over the age of 18. And parents can take some comfort from the law’s acknowledgment of their unconditional love for their children, regardless of age.

“The only way love can last a lifetime is if it's unconditional. The truth is this: love is not determined by the one being loved but rather by the one choosing to love.”
― Stephen Kendrick, The Love Dare

Staying Out of the Courtroom in the New Year

M. Cheryl Kirby — Wed, 02 Jan 2013 00:00:00 -0500

There are many types of legal claims that employees can bring against an employer, but, as a general rule, employees who believe their employer is treating them fairly do not pursue lawsuits. On the other hand employees who "perceive" that they are being treated unfairly may seek out a lawyer, regardless of whether they have legitimate claims. As employers know only too well, even though an employee’s "claim" may have no valid legal basis, defending such claim can cost the employer a lot of time and expense even when the employer prevails in the end.

So how do you avoid lawsuits and claims? One important strategy is to avoid even the appearance of unfairness in the workplace. We all know the basic policies and procedures for having "fair and equal" treatment in the workplace, i.e., be consistent in the use of evaluation criteria, mete out discipline uniformly and pay equal pay for equal work. But there is more to creating a work environment where employees feel they are being treated fairly than just following policies and procedures.

At the top of the list is having a workplace where an employee’s work gives him/her a sense of accomplishment. So how can you foster a work environment where employees get a sense of accomplishment from performing their jobs? The three steps below will start you toward that goal.

(1) Give the employee true responsibility.

(2) Allow the employee to be involved in decisions.

(3) Hold the employee accountable for carrying out his/her responsibility.

The first step, giving responsibility, is fundamental to making it possible for an employee to feel that he has accomplished something. That also means you must give the employee sufficient information about what is expected and why, because an individual without information cannot take true responsibility.

The next step, allowing decision-making, will give employees a sense of "ownership" in the results. Of course the extent of decision-making must fit within the scope of the job, but there are decision-making opportunities in every job. So look for these opportunities and set the stage for employees to feel a real sense of accomplishment in their work.

The last step, holding employees accountable, is the logical follow up to the first two and necessary to give employees a continuing sense of accomplishment in their work. Each employee knows whether he/she is being held accountable – you just can’t fake that. When there is no accountability, employees may feel that you’re being hypocritical and won't "trust" the employer. Having no accountability may even do more harm than good. So hold employees accountable - there's simply no downside to this.

The beginning of a new year is an ideal time to implement strategies to create a work place where employees are proud of their work and feel that they are treated fairly. Everyone wins – employees are happy and you are less likely to get sued in 2013. So ring in the New Year and get started.

Twelve Workplace Tips for the 12 Days of Christmas

Katie Anderson — Tue, 20 Nov 2012 00:00:00 -0500

Whether your employees believe it’s “The Most Wonderful Time of the Year,” or they’re lamenting a “Blue Christmas,” employers should remember some employee issues during this holiday season. Here are some tips:

Not everyone celebrates Christmas (“I Have a Little Dreidel”). As American companies continue to embrace diversity, employees may need to be reminded that not everyone celebrates the same holidays.
Beware of flammable holiday décor (“Deck the Halls”). Employers owe a duty to provide a safe environment for employees and must not subject them to unreasonable risk. Make sure that holiday decorations do not violate any local laws (think fire code). Consider possible employee allergy issues before setting up a live Christmas tree.
Your employee may want a part-time Santa gig (“Here Comes Santa Claus”). Some employees seek additional employment during the holiday season to handle the extra expenses. If you have a moonlighting policy, follow it carefully and consistently.
Make time for holiday shopping (“Silver Bells”). It may be cost-effective and morale boosting to set aside some out of office time for employees to holiday shop. If you do, remember to treat all similarly-situated employees the same and note that any exception to the acceptable use policy for technology (i.e. – online shopping) should be in writing, given to all employees, and consistently enforced.
‘Tis the season to sneeze (“Let It Snow”). Employee illnesses can increase with weather fluctuations, wintery mixes, more time indoors, and holiday stress. Reminding employees of leave policies can combat germ spreading and paycheck surprises when they exceed their accrued paid leave.
Crime rises in December (“The Grinch Theme”). Remind employees to be extra vigilant about unfamiliar faces in or around the office premises, to use any available security services, to stay alert and off the phone while walking to their cars, and to secure their purses and wallets in the office.
Holiday parties can be fun, with the right precautions (“Rockin’ Around the Christmas Tree”). Do what you can to keep things fun, but professional. If serving alcohol, give limited drink tickets (and advise they are not transferable) or perhaps offer a specialty cocktail that is more fun than intoxicating. Some employers offer door prize drawings for which only designated drivers are eligible. If you are going to have music, give the DJ or band a suggested play list of appropriate, fun songs.
On top of everything else, it may be time to make your benefit elections (“Grandma Got Run Over by a Reindeer” and should have had health insurance). Give employees sufficient time and opportunity to learn about any changes (i.e. to premiums or coverages). Employees may need time to consult with their accountants and/or spouses. Give the information as early as it is available and clarify the deadline.
Be mindful of policies on gifts (what else – “The Twelve Days of Christmas”). You may want to thank your special clients with a token of appreciation. However, you will need to confirm whether they have any prohibitions on accepting gifts, especially if the client is a governmental entity. You can often find this information in company policies or through the entity’s Human Resources Department.
Remind employees of vacation policies (“I’ll Be Home for Christmas”). Many employers do not allow employees to head home for the holidays en masse, or discourage taking leave the day before or after a holiday. Remind your employees of such policies or preferences so you can set them up to successfully follow them.
Working on a holiday does not necessarily mean more pay (“Do They Know It’s Christmas?”). Employers do not have to pay employees more just because they are working on a holiday, though many choose to do so. Legally, an employer must only pay non-exempt employees for work performed in excess of 40 hours in a week.
Encourage resolutions for a happy and productive new year (“We Wish you a Merry Christmas”). Both employees and employers can be encouraged to make professional goals in the form of resolutions. These should be written down, with dates calendared throughout the new year for a status check on the progress of these goals.

For holiday happiness in the workplace, an ounce of prevention really is worth a pound of cure. Many difficult situations can be avoided with the proper attention and planning. Now is the time to review policies, to remind employees of the policies, and to follow them fairly and consistently. During this holiday season, what we most hope for your business and your life is that you bring “Joy to the World.”

Happy Holidays. Feliz Navidad. Fröhliche Weihnachten Joyeuses Fêtes! Felices Fiestas! Trevlig Helg! Boas Festas! Mutlu Bayramlar! Sarbatori Fericite! JieRi Yu Kuai! Bones Festes! Tanoshii kurisumasu wo! Buone Feste! Ii holide eximnandi! Beannachtaí na Féile! Vesele Praznike! Selamat Hari Raya! Sretni praznici!

Here are some holidays to keep in mind:
12/8 - Bodhi Day/Rohatsu (Buddhist)                      12/8 - Feast of Immaculate Conception (Catholic)
12/9 - Hanukkah (through 16th) (Jewish)               12/23 - Gita Jayanti (Hindu)
12/25 - Christmas (Christian)                                       12/26 - Kwanzaa (through Jan 1st) (Interfaith)

Introductory Period - To Have or To Have Not

M. Cheryl Kirby — Thu, 01 Nov 2012 00:00:00 -0500

Many employers set aside a certain time period for new employees as an introductory or probationary period to determine the new employee's suitability for the job. During this period employers have the opportunity to assess the performance of new employees – both their job skills and their "fit" with the employer’s culture. Practically speaking, there is no particular distinction between introductory and probationary periods, but "probationary" has a punitive ring to it - as if problems are expected – so most employers prefer to designate these periods as "introductory" periods.

The purpose of the introductory period should be explained to the new employee, so that the employee can come to grips with the fact that he/she will have to fit the job and the culture before the end of the period. With this understanding the new employee should not be surprised if the employer decides, before the end of the introductory period, that he/she is not a good fit. If used effectively the introductory period can provide a way for the employer to minimize its legal exposure for termination of the employee.

So what is the downside to having introductory periods for new employees? One drawback is the potential implication that there is an increased level of job security after the period ends – an implication that is inconsistent with employment-at-will. From a legal perspective, if an employer has an employment-at-will relationship with its employees, the employer has the right to terminate an employee for any lawful reason at any time, whether during or after the introductory period. But employees may consider themselves "permanent" after they complete an introductory period and believe and expect they will not be terminated except "for cause."

Since one’s level of expectation is generally proportional to the level of disappointment experienced when that expectation is not met, litigation is often the result. So what can an employer do to avoid inadvertently raising expectations of job security after the completion of an introductory period?

First, clearly articulate the reasons for an introductory period without implying there is an increased level of job security upon completion. Second, include a disclaimer in the policy explaining that the employee’s at-will status continues after completion of the introductory period. Third, have a completely separate at-will policy and include appropriate at-will disclaimers in other policies such as disciplinary policies.

In the end if an employer decides to have an introductory period, it is important for the employer to make sure it communicates a clear understanding of the purpose of the introductory period to new employee, and correctly words its policies to preserve their employment at-will status, so that this can be an effective evaluation and decision-making tool to help the employer make early decisions that can cut its losses down the road.

Go Vote!

Tiffany G. Hildreth — Wed, 24 Oct 2012 00:00:00 -0500

I just dare anyone to claim that they “forgot” to vote these days. If you haven’t been barraged by radio and TV ads, or twittered, spammed and cold-called every other minute with political propaganda, you must be living under the proverbial rock (and a big one at that). Since no one can realistically “forget” to vote, but they will “forget” to do so until the very last day, you will have employees that need to leave the office to cast their ballot.

Just in case you were thinking about telling these employees “too bad, so sad, you should have gone to early voting,” keep in mind that keeping him or her from the polls can be a CRIME under Texas law.

Texas Election Code §276.004 requires Texas employers to allow their employees time off to vote as follows:

a. A person commits an offense if, with respect to another person over whom the person has authority in the scope of employment, the person knowingly:

1. refuses to permit the other person to be absent from work on election day for the purpose of attending the polls to vote; or

2. subjects or threatens to subject the other person to a penalty for attending the polls on election day to vote.

b. It is an exception to the application of this section that the person's conduct occurs in connection with an election in which the polls are open on election day for voting for two consecutive hours outside of the voter's working hours.

c. In this section, "penalty" means a loss or reduction of wages or another benefit of employment.

d. An offense under this section is a Class C misdemeanor.

According to the Texas Workforce Commission, an employer will abide by §276.004 if it:

lets employees have at least two hours off to vote on an election day, unless they have already voted under early voting procedures; and
pays the employee for time off necessary to vote, to the extent that time cuts into the employee's normal working hours.

The Commission further notes that employers do not have to pay employees for time off necessary to vote if the polls are open for two consecutive hours outside of the employee’s normal working hours. Also, take into account whether voting opportunities occur during overtime hours. If the employee has to take time off from mandatory overtime to vote, the time off should be paid at the rate that would have applied to the time so missed. But, if the time is taken off from optional overtime voluntarily requested by the employee, it does not need to be paid, since the time off would be outside of normal working hours and is time that the employee voluntarily chose to spend working rather than doing something else (like voting).

Gold’s Gym sued for Weighty Issue of Overtime Pay

Katie Anderson — Wed, 10 Oct 2012 00:00:00 -0500

Current and former employees of Gold’s Gym International, Inc. (“Gold’s”) flexed their collective muscles and sued the chain, alleging it forced them to work “off the clock” in violation of the Fair Labor Standards Act (“FLSA”). Plaintiff sales managers say Golds did not pay them overtime even though it required them to train fitness consultants and monitor their sales numbers, which resulted in 50-60 hour workweeks.

Plaintiffs filed their federal lawsuit last week in San Antonio, Texas, claiming that the Gold’s corporation is organized under the laws of Texas and operates facilities all over the United States, with 20 locations in San Antonio alone. Plaintiffs want to certify a collection action for all current and former Sales Managers employed from October 2, 2009 – October 2, 2012, and are demanding back pay for unpaid wages, unpaid overtime, liquidated damages and attorneys’ fees.

Plaintiffs argue they are not exempt from overtime pay requirements because they do NOT engage in any of the following:

(a) manage an enterprise or a recognized department or subdivision of Gold’s;

(b) direct the work of two or more employees;

(c) have the authority to hire or fire other employees, nor were their suggestions on status of other employees given particular weight;

(d) perform office or no-manual work directly related to the management or general business operations of Gold’s or Gold’s customers;

(e) exercise discretion or independent judgment with respect to matters of significance; or

(f) customarily or regularly engage away from Gold’s place of places of business in performing their primary duty.

Plaintiffs acknowledge that Gold’s has a company policy prohibiting employees from working more than forty hours a week without prior approval. “Overtime approval required” policies are common, but can easily be avoided by plaintiff employees who claim, as they have in this Gold’s case, that the employer circumvented its own policy by withholding overtime approval and requiring them to clock out but continue working or to falsify their time records.

Employers with “overtime approval required” policies should also remember these tips:

(1) non-exempt employees who violate the policy and work more than 40 hours without approval must still be paid for all hours worked;

(2) employees who violate the policy can and should be consistently and equally disciplined;

(3) the discipline for failing to obtain prior approval should usually be progressive discipline (everything from “take a lap” for the first offense to “you’re fired!” after appropriate warnings and reprimands have been given to no avail).

Whether this dispute will “work out” for either side remains to be seen. In the meantime, we will “weight” and see!

Not All Surprises Are Good

M. Cheryl Kirby — Fri, 05 Oct 2012 00:00:00 -0500

Yikes. It’s that time of year again - annual performance evaluations are due. All sorts of emotions are triggered – not the least of which is old fashioned dread. But why such anxiety over a process that is supposed to improve performance and further the company’s achievement of its goals.

Well, in many cases performance evaluations are based on poorly articulated goals and objectives with little attention paid to them until evaluation time rolls around. Then the employee sits down with the boss and has a vague discussion about subjective topics that are not really measurable in the first place. This process can lead to a lowering of employee morale, particularly if the employee is surprised by criticisms not previously raised. For the most part, delivering a "surprise" to an employee in an annual evaluation is as much an indication that the manager failed to effectively "manage" throughout the year as it is an indication that the employee failed to perform. Performance evaluations should be only a small part of an ongoing coaching and development program – not a "gotcha" at the end.

In addition to ongoing feedback from managers, another way to avoid delivering surprises in annual evaluations is to make employees accountable for identifiable results. If an evaluation contains vague and broad categories that fail to identify employee responsibilities that have a true impact on results, the stage is set for unpleasant surprises. A truly effective evaluation measures an employee’s performance against predefined standards that the employee knows and understands as he performs his job throughout the year.

Another effective way to take the sting out of annual evaluations is to hold the boss accountable for the success of those he/she supervises and evaluates. This works to motivate the boss to engage in an ongoing process of giving feedback year round. It also tends to reduce the amount of "blame" the boss transfers to his subordinates for problems in his/her department.

The bottom line is that a performance evaluation should be a collaborative effort undertaken by the supervisor and his subordinate on an ongoing basis. This gives the supervisor opportunities to provide candid feedback that identifies strengths and weaknesses in routine non-threatening settings that can be beneficial to both - while helping the company achieve its goals at the same time.

Just Like the Energizer Bunny, The EEOC Keeps Going and Going and Going

Francine W. Breckenridge — Tue, 18 Sep 2012 00:00:00 -0500

Way back in June 2007, Ms. Sandy, who is hearing and speech impaired, filed an EEOC charge against Kroger, a grocery store chain, alleging disability discrimination when she applied for a position as a cashier, bagger and stocker. During its hiring process, Kroger uses a “Customer Service Assessment” (“CSA”) created by a company called Kronos. The CSA purports to evaluate several human traits underlining “strong service orientation” and “interpersonal skills” such as controlling impatience, showing respect, listening attentively, working well on teams, and being sensitive to others’ feelings. According to Kronos, applicants with higher CSA scores are more likely to be cheerful, polite, friendly, listen carefully, and communicate well with customers. Poor Ms. Sandy scored just 40%.

In response, Kroger provided Ms. Sandy’s employment application summary with the Kronos assessment which, as you may imagine, was not very complimentary. The EEOC, however, wanted more and issued a third-party administrative subpoena to Kronos. The subpoena sought CSAs created or performed for customers other than Kroger. The District Court said: “No, No, No EEOC; you cannot subpoena materials that do not directly relate to the test Kronos developed or implemented for Kroger.” Undaunted, the EEOC appealed to the Third Circuit. (By the way, this was the second time the EEOC appealed a discovery dispute in this matter to the Third Circuit.)

Just last week, the Third Circuit overturned the District Court’s decision. It held that Kronos must produce such documents, “even if not directly linked to Kroger,” because the documents might reveal that CSAs adversely impact disabled applicants. The Court further opined that the CSAs might assist the EEOC in evaluating whether “Kroger’s use of the tests constituted an unlawful employment action.”

This opinion offers several life lessons for employers:

The EEOC has extremely broad subpoena power.
The EEOC can and will employ aggressive litigation tactics and will keep on “going and going and going” if it disagrees with a Court decision.
If your company uses outside assessment tests during the application or interview process, it might be liable for any type of disparate impact caused by the third-party’s tests because it will be your company that is sued for discrimination, not the company that created the tests.
Employers using such tests should review the general findings to ensure that the tests do not adversely impact any protected class.

Heed the life lessons learned by Kroger so that if the EEOC, aka “Energizer Bunny,” comes knocking, you can stop it dead in its tracks.

Fishing on Facebook may put Employers “On the Hook”

Katie Anderson — Mon, 06 Aug 2012 00:00:00 -0500

Do you require employees or applicants to provide access to the otherwise private portions of their social media pages? While it certainly helps to know what a person is posting (“This company is the WORST!”) and when they’re posting (“Well, its 5:00 SOMEWHERE!!”), employers should heed the dangers lurking in the murky waters of “Facebook fishing.”

When an employee takes the bait, what risks does an employer run?

Requiring employees to give access to this type of information may create more problems than benefits, for reasons far too numerous to fully discuss. But remember some of the more important arguments against “Facebook fishing:”

1. It is illegal in some states.
Commentators compare looking at someone’s postings to traipsing through their home. While this seems a stretch, many people do believe that what they post onto the billion-person internet is still “private.”

Along these lines, Illinois and Maryland ban employers from requesting passwords and other social media information from employees and prospective employees. Notably, the Illinois law does not prevent employers from having workplace policies to limit an employee’s use of the employer’s equipment to access social media at any time or to limit an employee accessing social media while at work.

2. You may get more information than what you wanted.
Even if it is lawful to gain access, once you obtain additional information (especially about an applicant), you are charged with that knowledge and cannot use it to unlawfully discriminate. What if you turn down an applicant who posted a picture of himself holding his “Happy 50th Birthday!” card while wearing a yarmulke? Now you may be in the not-so-enviable position of showing that you did not consider his age or religion in your decision. You also better be sure that you’ve asked everyone for social media access, and not just him.

3. You may get more responsibility than what you wanted.
Employers usually want access to social media postings in order to protect company business interests. But, you may end up having to protect more interests than you planned. Suppose an employee posts threats of physical violence towards co-workers and then shows up to work with a weapon? What about one employee harassing another employee online by commenting on conduct in the workplace? If you access employee postings, but failed to notice or act on these particular posts, you might be found negligent and liable for the consequences.

4. The NLRB might not like it.
The National Labor Relations Board enforces the Wagner Act, which protects workers’ rights to join together to improve wages or working conditions. Employees communicating to effectuate those purposes are protected. Recently, the NLRB has brought enforcement actions against employers for violating this protection. The result is you need to think twice before disciplining an employee for using social media to discuss work conditions. While a post such as “I hate my stinky-breath boss” may warrant little protection, a post such as “my boss’ sexual innuendos make me feel uncomfortable - if you feel this way too, please ‘like’ this post so we can work together to expose him” is probably within the protected realm.

5. Public employees have 1st Amendment protections.
Oh, and just in case Constitutional rights haven’t crossed your mind lately, don’t forget that public employers cannot limit their workers from speaking on topics of public concern. Governmental entities have to be particularly careful about what social media speech they attempt to restrict or punish.

Tips for Employers who Cast their Nets into the Social Media Waters

Despite the risks, some employers will continue demanding access to social media sites. If you are one of them, always consider the following:
* access similarly situated personnel’s information with the same frequency;
* limit the access to an upper-level employee who doesn’t hire or fire, but will merely report on concerning activity;
* establish procedures on when and why social media postings will be reviewed and potential job consequences for certain types of information;
* share those procedures openly and honestly with all employees and prospective employees; and, most importantly,
* consult legal counsel before taking action on information posted on a social media website.

And finally, if you do find something fishy, don’t buy it hook, line, and sinker. Follow-up to find the truth before reacting to the information.

What Can I Ask When an Employee Calls in Absent?

M. Cheryl Kirby — Thu, 02 Aug 2012 00:00:00 -0500

When an employee calls in and says he’s not coming to work because he is "sick," what should you ask - or not ask - about the reason for his absence? As we all know, there are potential pitfalls associated with asking an employee about his medical condition. However, you need some information to evaluate whether the absent employee has a "serious health condition" that could trigger coverage under the Family and Medical Leave Act (FMLA).

Employers are often reluctant to ask for medical information in this situation because they worry about running afoul of the Americans with Disabilities Act (ADA), which restricts employer inquiries into employees’ medical information . This risk arises when the employee’s absence is due to a condition that is also a disability under the ADA.

With the ADA’s restrictions in mind, you can still make inquiries into the employee’s ability to perform the functions of the job and thereby obtain information that will help you determine if the absence may be covered by the FMLA. Indeed, the ADA and FMLA have something in common that allows employer inquiry - coverage is based on whether the employee is able to perform the job functions. Under the ADA an employee is covered only if that employee is able to perform the essential functions of the position with or without reasonable accommodation. Under the FMLA’s "serious health condition" provision, an employee is covered only if the employee is unable to perform the functions of the position because of the condition. Since the employee’s ability to perform his/her job is critical to determine coverage under both statutes, both permit inquiries that are related to functions of the job.

Therefore, when an employee calls in "sick," you can ask the employee if s/he is unable to perform his/her job because s/he is sick and what part of the job s/he cannot perform. Depending on the answers to these questions, it may be appropriate to ask if the employee intends to see a doctor and how long it will be before s/he thinks s/he will be able to perform the job.

The answers to these questions should help you determine if the absence should be designated as FMLA leave without violating the restrictions on inquiry under the ADA or FMLA.

I’m from the Government – Get out Your Checkbook

Kimberly S. Moore — Tue, 24 Jul 2012 00:00:00 -0500

As the daughter of an IRS lifer it was not until I was an adult that I understood why my Dad never wanted others to know what he did. Other people always had that almost visual reaction when they found out he worked for the IRS. Based on recent almost preposterous enforcement actions by the EEOC – I wonder if their employees get the same reaction when asked what they do?

This recent example is the story of Kevin Morrison, born in Jamaica, living in Maryland, who had been working, on occasion, for various companies like Good Humor and Ashley Furniture as a temporary worker through Ranstead.

Morrison could not read or write and was; therefore, denied an assignment at Lenox. Ranstead required him to have basic remedial reading and writing skills for future assignments. Morrison filed a discrimination charge claiming failure to hire on the basis of his Jamaican national origin. Ranstead responded that the positions virtually all require minimal literacy and it had “an unwritten literacy requirement.”

Two years later while the largely dormant EEOC investigation persisted, Morrison amended his charge to claim a protected learning disability. Ranstead argued that a lack of learning was not a protected disability. The EEOC, however, decided to launch a full investigation seeking volumes of paper about all possible jobs Morrison could have performed. Ranstead said it would take between $14,000 and $19,000 to respond to the EEOC document request. The court allowed the EEOC’s fishing expedition despite the far-fetched allegation.

Ranstead and other employers can potentially avoid the expensive enforcement actions with written, job specific policies rather than relying on “unwritten requirements.” If the EEOC decides to investigate and the response is unnecessarily expensive, the employer must show it would be burdensome in comparison to normal operation costs and would seriously disrupt business. While most people would likely agree that $19,000 to produce documents for an employee who could not read or write is disruptive, the government requires more.

THE SUPREMES HAVE SPOKEN – Get Ready Employers!

Francine W. Breckenridge — Mon, 23 Jul 2012 00:00:00 -0500

Thousands of businesses took a wait-and-see attitude towards the Patient Protection and Affordable Care Act (“ACA”), believing that the Supremes would eventually invalidate the ACA. Well, they didn’t and whether you agree or disagree with the decision upholding the ACA’s constitutionality, it’s time to take the proverbial head out of the sand and act. The full law goes into effect in 2014 and employers who don’t start preparing now may very well find themselves in a “taxing” situation.

To meet the numerous ACA mandates that will unfold over the next few years, businesses should focus on the three C’s – communication, compliance, and cost control. Employers should plan now for how they will capture and store employee data, organize it in a reportable form to the government and ensure compliance with all reporting requirements. Keep in mind that the ACA requires much more than a few report filings and company-wide health insurance audits.

Even if the ACA does not apply to your company because you have fewer than 50 employees, consideration should be given to the tax credits and improved small business growth opportunities available if you do comply. Even if you think that your current health care plan is “grandfathered,” understand that the employer mandate is tricky and retaining grandfathered status is not so easy.

If the sand is looking mighty tempting to burrow in for just a little while longer, remember that 2014 is less than eighteen months away ….

Employee Handbooks – You Can Be Your Own Worst Enemy

Jana H. Woelfel — Fri, 20 Jul 2012 00:00:00 -0500

Hopefully you have heard by now that Employee Handbooks can be your friend. They give you an opportunity to set forth policies, procedures and avoid confusion about what you expect from employees. That sounds reasonable, right? Not so fast. Some policies, even policies that do nothing more than state the applicable state law on a subject, can land an employer in hot liability waters.

For those who don’t closely follow decisions of the National Labor Relations Board (NLRB), thinking that it doesn’t affect them as non-union shops, you are in for a rude awakening. The Acting General Counsel of the NLRB, Lafe Solomon, has begun broadly interpreting Section 7 of the National Labor Relations Act (NLRA) to include almost any action which could conceivably be construed to chill employee’s rights to engage in concerted activity as unlawful. Yes, I intended to use the word “conceivably” and for once I am not dripping with sarcasm. I meant it.

By now, most employers understand that the NLRB protects employees who get together to complain about their pay, their benefits or how management treats them. I still occasionally run across policies in Employee Handbooks which advise employees to keep all compensation terms confidential. However, such policies have long exposed employers to a NLRB complaint, even when the workplace is not unionized. It is not a reach to conclude that a bald-faced prohibition on employees discussing compensation falls within the Section 7’s protection of employees discussing the terms and conditions of their employment. But, sometimes it isn’t so clear that the policy was intended to proscribe discussion of the terms and conditions of employment.

For example, what about a policy which forbids employees from posting “confidential guest, team member or company information” on social media? Unfortunately, this language has been construed by the NLRB’s Acting General Counsel to be so broad and vague as to fall within Section 7’s protections of employees’ ability to discuss their working conditions. While that may seem like a stretch to many employers who rely on plain-language and common sense to guide their decisions, it was enough for the NLRB to find a violation.

In the past 9 months, the NLRB has issued three memos to clarify what an employer (union or not) may do in the social media context without potentially violating employee’s rights. Specifically the Operations Management Memo describes several cases involving social media policies. In six of the seven cases the NLRB found some portion of the social media policy to be unlawful. Not long before that, the NLRB provided memos in August 2011 and January 2012 describing discharge cases arising out of an employee’s termination for content posted on Facebook.

But that’s not the least of it.

Earlier this year, the NLRB issued an opinion that a policy that requires employees to acknowledge their at-will status could be chilling on an employee’s Section 7 rights to engage in concerted activity. What!?!!? That’s right, the NLRA’s Acting General Counsel has taken the position that an acknowledgement in a Handbook that employment was at-will and that status could not be modified except in a writing, signed by management, violated Section 8(a)(1) of the NLRA because it would chill an employee’s Section 7 right to engage in concerted activity. What, pray tell, were the offending provisions, found by the NLRB to be “overly broad, discriminatory, and coercive”? See below and tell me whether your Employee Handbook includes anything of the sort:

• “I understand my employment is ‘at will.’”
• “I acknowledge that no oral or written statements or representations regarding my employment can alter my at-will employment status, except for a written statement signed by me” and Hyatt’s president or executive vice president/COO.
• “[T]he at-will status of my employment… can only be changed in writing” signed by the employee and one of the two Hyatt executives.

Texas has long applied the default rule of at-will employment, meaning that either party to the employment relationship can terminate the relationship at any time for any reason. Many jurisdictions do the same. But the NLRB has taken the position that having an employee confirm that he understands he is employed at-will is a violation of the NLRA. Lest you think this was an isolated incident, you should know that the Acting General Counsel has announced to more than one group across the nation, including the Connecticut Bar Association earlier this month, that the “next big enforcement focus will be on employers’ “at-will” statements within employee handbooks.

I kid you not.

Get ready for it or risk being hoisted on your own petard.

“Time is on My Side,” said Mick Jagger (and the Employee Armed with the Handy New Guide from the DOL)

Jana H. Woelfel — Tue, 10 Jul 2012 00:00:00 -0500

How well do you know the protections of the Family Medical Leave Act (FMLA)? I hope you are brushing up on them (or have our number handy), because the Wage and Hour Division (WHD) of the Department of Labor (DOL) recently released a friendly, easy-to-understand Employee Guide (1,2) entitled "Need Time? The Employee's Guide to the FMLA" to help employees thoroughly understand their rights under the FMLA.

The Guide is written in plain English and is designed to help employees across a variety of sophistication levels avail themselves of their rights under the FMLA. It explains various types of serious health conditions that may qualify for FMLA leave, discusses very generally the types of military family leave, explains what in loco parentis status means (any child an employee has day-to-day care and financial support obligations for, regardless of legal relationship), and includes a number of flow-charts to help employees understand when their rights to leave, the certification process, reinstatement, and how to file a complaint if the employee is concerned his/her rights have been violated. The website also includes a link to a webinar on the FMLA given on June 27, which walked through the Employee Guide and explained the high points of the FMLA.

Any citizen understanding his or her rights under the law is not a bad thing. But for an unprepared employer, an employee who has even a cursory understanding of his rights under the FMLA, can be a dangerous thing. If you haven't looked at your obligations under the FMLA, now is a good time. The WHD has made it very easy for an employee to understand his rights and file a complaint if you don't. However, the Employee's Guide, particularly the flow-charts, can be used by employers to confirm that both the employer and employee have fulfilled all their respective obligations under the Act. For example, the certification process is often confusing for employees and employers alike. The Employee Guide provides a simple, step-by-step on pages 12-13 that will help employers confirm they are getting the right information at the right time.

At a minimum, employers should consider this basic guide to be how the DOL perceives the FMLA should work, and should adjust their behavior accordingly. While the employee may not follow the lyrics of the Rolling Stones tune exactly, e.g., “you’ll come running back,” a smart employer wants to be prepared and will know its obligations under the FMLA so it can explain to the employee along the way that while “you can’t always get what you want, if you try sometimes, you just might find, you get what you need.”

To Sell or Not to Sell, That is the Question: The Supreme Court’s View of Outside Sales Employees

Monica Velazquez — Fri, 29 Jun 2012 00:00:00 -0500

As an attorney, unfortunately, you are always spotting legal issues in day to day life. The other day, as I sat waiting at the nurse station in my doctor’s office, an all-too familiar scenario unfolded: A young, attractive, well-dressed woman with a rolling briefcase, blue tooth in her ear, and black locked bag walked in the door. The box of donuts, bag of candy, and carrying-case with several hot coffees gave her away. The pharmaceutical sales representative dropped off the goodies at the reception desk, re-stocked one of the cabinet drawers with samples of prescription goodies, asked a few questions of the nurses, and then left, indicating she would be back in next week. Instead of wondering where she got her cute shoes that matched her purse like a normal person, I wondered if she was aware of the Supreme Court’s recent decision against pharmaceutical sales representatives holding that they were not entitled to overtime pay under the Fair Labor Standards Act (FLSA).

Pharmaceutical companies directly promote their products to physicians through pharmaceutical sales representatives (PSRs) or “detailers” who try to get physicians to make non-binding promises to prescribe their companies’ drugs as appropriate. PSRs are usually highly-compensated; earning both a salary and incentive pay based on the performance of their drug portfolios. For years, PSRs had been classified as exempt outside salespeople not entitled to overtime pay under the FLSA. While that exempt classification had been challenged in courts, the long-standing practice remained in tact. Then, in 2009, the Department of Labor (DOL) filed amicus briefs in the Second and Ninth Circuit Courts of Appeal, indicating the agency’s position that PSRs were non-exempt employees entitled to overtime pay. According to the DOL, PSRs did not qualify for the outside sales exemption because they were not actually selling (i.e. transferring title to tangible property) as defined in the agency’s regulations. Interestingly, however, the DOL never initiated any enforcement actions against the employers of PSRs. Conflicting court opinions ensued and the United States Supreme Court finally decided the issue in Christopher et al. v. SmithKline Beecham Corp., d/b/a GlaxoSmithKline issued on June 18, 2012.

The Supreme Court ruled, 5 to 4, in favor of employers and against the PSR plaintiffs. Under the most reasonable interpretation of the DOL’s regulations (which were last updated in 2004), selling did not just mean selling or transferring title, it could also include consignments that did not involve a transfer of title. The DOL’s position that PSRs were only engaging in promotional work that was incidental to sales made, or to be made, by others, was unconvincing. According to the Court, the FLSA focuses on the “capacity” in which the employee is employed and should be interpreted in favor of a functional, rather than a formal, inquiry based on the employee’s responsibilities in the context of the industry in which she works. Since by law and industry practice, PSRs cannot sell drugs directly and must rely on non-binding commitments by doctors to prescribe their companies’ drugs, PSRs are making sales in the broadest sense of the term. [As an aside, Justice Alito also observed that the PSRs involved in the case earned, on average, more than $70,000 per year and were “hardly the kind of employees that the FLSA was intended to protect.” Perhaps suggesting that the FLSA only protects the exploited and poor, and not the exhausted and rich?] In any event, the Court provided some valuable insight for those of you who have exempt employees, including outside sales employees: Are your employees selling or promoting your services or products? If you are not sure, perhaps you should take a look around to see how others in your industry classify their employees and why they do so. It is worth a second look, which could save your company money and the pitfalls of litigation. As for me, as I was leaving my doctor’s office, I saw another well-dressed gentleman, this time with a box of bagels, headed into the building. For a fleeting moment, boy, did I wish I was a doctor … or maybe, I was just hungry.

“Sexual Harassment Culture” Allegations Tarnish Gold Medal Dreams

Katie Anderson — Mon, 18 Jun 2012 00:00:00 -0500

Olympic stories are supposed to be about athletes who overcome incredible odds to succeed. Unfortunately, the first big story from the upcoming London Olympic Games involves more dirt and scandal than Cinderella’s story of hopes and dreams.

Kelley Hardwick, a security director with the National Basketball Association (“NBA”), filed suit last week in New York state court alleging that U.S. Women’s Olympic basketball team coach and head coach for the University of Connecticut’s women’s team, Luigi “Geno” Auriemma, "stalked, assaulted and battered (her) by following her to her room, grabbing her about the arm and attempting to forcibly kiss her on the mouth" in 2009 while abroad in Russia. Of note to employers, however, are Hardwick’s allegations against the NBA.

Hardwick sued the NBA (her employer), as well as its umbrella organization that oversees the men’s and women’s basketball teams, USA Basketball Inc. She claims that the NBA was both directly involved in Auriemma’s conduct towards her and also discriminated against her through a “corporate culture of gender discrimination." Her lawsuit alleges that the NBA failed to conduct a thorough investigation of the incident with Auriemma and further allowed him to influence a recent decision that she be removed from international travel security detail for essentially rejecting his advances. Her removal was indicative of the culture of gender discrimination because her male counterparts who get to travel do not have her level of experience in international competition. Additionally, Hardwick avers that the NBA denied promotions, raises, and employment opportunities because she is a woman.

As in most cases of “he said, she said,” Hardwick’s lawsuit is not a slam dunk. The outcome will not likely be known until the Olympic torch has been extinguished. In the meantime, the women’s team will have the additional distraction of the allegations and the accompanying media scrutiny. Let’s hope they can rebound like champs to bring home the gold for the red, white, and blue.

Bigger Ain’t Always Better in Texas

Allison Reddoch — Mon, 11 Jun 2012 00:00:00 -0500

Texans wear the slogan “Everything’s Bigger in Texas” with pride. Whether it’s big hair, big chicken fried steak, or Big Tex, who says bigger ain’t always better in Texas? One Texas hospital tried to say otherwise, and soon ate its words.

In April, the hospital made national news after it was sued over its hiring policy barring potential employees who are obese. The hospital quickly reversed its policy amidst outrage fueled by national news sources denouncing the policy as discrimination against the obese.

But, legally, this Texas-sized ban was not discriminatory. In Texas, employers cannot discriminate because of race, color, national origin, religion, sex, age or disability. However, like the majority of other states, Texas does not ban weight discrimination. Additionally, there is no federal law specifically prohibiting obesity discrimination. Some obese individuals have argued, however, that their weight can be considered a disability for purposes of the ADA.

The ADA protects job applicants and employees from disability discrimination. Under the ADA, to qualify as a person with a disability, the applicant/employee must have a physical or mental impairment that substantially limits one or more major life activities. Working, among other things, is a major life activity.

While obesity itself is generally not an impairment, morbid obesity, meaning body weight of more than 100% over the norm, is a disability if the applicant/employee shows the physical impairment substantially limits a major life activity. Additionally, these individuals may have other conditions related to their obesity, such as high blood pressure, diabetes, or a heart condition, that may be protected.

While heftiness is not, itself, a protected class, employers can reduce their litigation risks by avoiding explicit weight bans. After all, bigger employees may not always be better, but lawsuits ALWAYS exact their pound of flesh.

Who has final say over who has to pay for birth control?

Katie Anderson — Fri, 01 Jun 2012 00:00:00 -0500

Should the Church, State or the Courts say whether an employer health plan must provide preventative medical services, including birth control, at no cost to patients?

Many might answer “none of the above” under the impression that no one should be making that call. But, as we speak, all three entities have thrown their hats into this ring of fire.

It’s a tossup as to who was really the first to weigh in. Undeniably, religious organizations have historically been known to have strong opinions on birth control in general. Thus, many might argue that the Church has at least implicitly had a say in this matter for some time. The State, however, held no punches when it passed The Patient Protection and Affordable Care Act, a/k/a “Obamacare,” which requires employer-provided health plans to provide no-cost contraceptives to workers by August 1, 2012. The PPAC is full of various insurance mandates, but since some employers are religious organizations with some particular views on birth control, this birth control mandate was ripe for controversy. Perhaps in anticipation of this very issue, the PPAC has a narrow exemption for “religious employers” who meet the following four criteria:

1) The “inculcation of religious values” is the religious employer's purpose,

2) The employer “primarily employs persons who share its religious tenets”,

3) “It primarily serves persons who share its religious tenets”, and

4) It is a non-profit organization under sections of the code that “refer to churches, their integrated auxiliaries, and conventions or associations, as well as to the exclusively religious activities of any religious order.”

This exemption is narrow indeed - employers who are also houses of worship may opt out of free birth control benefits, but religiously-affiliated charities, hospitals, and schools may not.

In defense of those employers who are not exempt, forty-three Catholic dioceses (including Dallas and Fort Worth) and institutions (including the University of Notre Dame) have filed suits in federal courts in eight states against various governmental officials, including Secretary Sebelius, challenging the birth control requirement as violative of the First Amendment. At least eleven other cases were previously filed and remain pending, and attorney generals in seven states have filed suits which are also yet to be determined.

So this means that the Courts may end up with the final say over who should pay for birth control. The Courts will be guided by the First Amendment admonishment:

“Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof...”

If a law restricts a constitutional right such as freedom of religion, it must meet three “strict scrutiny” criteria to remain valid:

1) It is justified by a compelling governmental interest,

2) It is narrowly tailored, and

3) The law or policy is the least restrictive means for achieving that interest.

The Catholic clergy say the requirement is an unprecedented attacked on religious liberty because it compels Catholic employers to provide access to services that are contrary to their religious beliefs. Proponents of the measure argue it provides greatly needed medical benefits for women and impacts health.

How the litigation will resolve is difficult to guess. What we do know is that it may take years for the cases to work their way through the federal district and appellate courts and that neither side is likely to back down until there is a conclusive ruling from the United States Supreme Court on whether the government can mandate health care benefits for workers of non-exempt religious organizations.

Is that a pig flying? Maybe not, but employees don’t have to arbitrate this one.

Martin Thornthwaite — Mon, 21 May 2012 00:00:00 -0500

By now, most are familiar with AT&T Mobility v. Concepcion, in which the United States Supreme Court affirmed class action waivers in contracts containing arbitration agreements. The Court did, however, caution that arbitration agreements may be invalidated under the Federal Arbitration Act by traditional contract defenses such as fraud, duress, or unconscionability. Yet, these defenses rarely succeed.

That said, in Samaniego v. Empire Today, LLC, a California appellate court recently held that a flooring company’s employment contract with its carpet installers was unconscionable. The plaintiffs brought a putative class action claiming that the company misclassified its installers as independent contractors rather than employees and failed to pay minimum wage and overtime compensation among other allegations. The unconscionability finding allowed the installers to litigate in court rather than individually arbitrate their claims in accordance with the arbitration provision in the contract.

Several facts supported the unconsicionability finding:

•Although the plaintiffs requested Spanish contracts because they couldn’t read English, the company provided only English versions because Spanish versions were unavailable.

•The company did not give the plaintiffs time to have the contracts reviewed and also told them they could not continue employment if they did not sign the contracts.

•The arbitration provision was near the end of the contract, which was 11 pages long with single-spaced text in small typeface.

•While the contracts referenced arbitration rules, none were provided to the plaintiffs.

•The arbitration agreement had one-sided provisions such as the company’s right to attorneys’ fees if it prevailed in arbitration, but none for plaintiffs if they prevailed.

•The company did not point out that plaintiffs would be giving up their right to court if they signed the contracts.

Even though courts rarely find unconscionability, employers should consider, at a minimum:

giving employees a reasonable amount of time to review employment contracts
providing translated agreements for non-English speakers
ensuring that the arbitration provision is conspicuous within the contract and acknowledges that employees give up their right to court if they sign the agreement
attaching arbitration rules to the contract or identifying within the contract where the rules can be found (such as a website reference)

Summer Interns: The Top Three Ways to Hire Interns Without Getting Burned

Kimberly S. Moore — Tue, 08 May 2012 00:00:00 -0500

1. No unpaid interns! That’s right, most interns do not qualify for unpaid status. The legal definition of who is an employee is broad and will cover 9 out of 10 situations. This means at least paying minimum wage and overtime for virtually every intern.

2. For everyone who does not believe Rule No. 1, read it again. Now, there are six criteria, all of which have to be met to have an unpaid intern.

• The internship has to be similar to what the intern would learn at school;
• The internship is for the benefit of the intern (not the employer). In other words, the intern can’t take the place of your employee while the employee goes on vacation;
• There must be an agreement from the start that the intern will not be paid;
• The intern must work with others, be supervised closely and cannot be used instead of someone else. Think of an unpaid intern as a shadow employee that you as the employer are teaching. Often the intern also receives college or school credit;
• This one is big. You as the employer can gain no immediate advantage to having the unpaid intern and your progress could be slowed. Again, this is the concept of someone learning from you rather than being brought in as free help; and;
• There is no expectation of a future job for the intern. The internship is not a prolonged job interview or tryout.

3. If you ignore Rule 1, make sure the six criteria are in a written internship offer letter which includes that it is unpaid; a job upon completion is not guaranteed and outlines the type of training provided.

Arrested Development at the EEOC

Francine W. Breckenridge — Tue, 01 May 2012 00:00:00 -0500

Okay, HR Departments and employment decision makers, are you ready to squeeze more work onto your overflowing plate? Everyone knows that the EEOC disfavors consideration of criminal history in employment decisions. Last week, the EEOC issued 52 pages of “updated” guidelines on the use of convictions and arrest records by employers. The new guidelines fault the multi-billion dollar background check industry for supposedly issuing incorrect and incomplete reports on a frequent basis which disproportionately impact minorities to their detriment. To counter these faulty background checks, the new guidelines require employers to perform a three-part “individual assessment” of criminal history information for any individual.

Will the new “update” lead to a workforce filled with criminals? Who knows what arresting developments will occur, but surely the new guidelines will create more work for already overloaded HR and personnel departments.

“It Gets Better” for America’s Transgendered

Jana H. Woelfel — Thu, 26 Apr 2012 00:00:00 -0500

Many Americans first came to know a transgendered person when Chaz Bono appeared on “Dancing with the Stars.” For those who didn’t tune in or follow other media on the subject, a person is transgendered if his/her self-identified gender identity differs from his/her biological or genetic gender identity.[1] Transgendered persons may actually undergo physical gender reassignment, or they may simply identify with a gender other than the one he/she was genetically assigned.

Why, you ask, is this the topic of a Labor & Employment blog? Well, because last week the EEOC decided to protect transgender status under Title VII.

On April 20, 2012, the EEOC opined that Title VII’s prohibition against discrimination of the basis of an employee’s physical gender includes protection on the basis of an employee’s self-identified gender.[2] The opinion arose out of a complaint filed by Mia Macy, a transgender woman working as a police detective in Phoenix, Arizona. At the time she was still known as a male, having not yet transitioned to female. She applied for a job in San Francisco, presenting herself as a man during the initial telephone interview. Ms. Macy asserts that she was offered the position, subject to a clear background check.

During the background checking process, Ms. Macy advised that she was transitioning from male to female. Five days later, Ms. Macy received an email that the position was no longer available due to budget cuts. Ms. Macy was subsequently told that the position had not been eliminated due to budget cuts, but had instead been given to someone else who was farther along in the background investigation. Given the timing and inconsistent information, Ms. Macy believed she was discriminated against due to her gender identity and she filed an EEOC complaint thereafter.

The local EEOC office rejected her claim asserting that “claims of gender identity stereotyping cannot be adjudicated before the [EEOC].” After Ms. Macy appealed, the EEOC ultimately agreed that gender identity discrimination was merely another form of gender discrimination protected by Title VII.

Many commentators characterize this opinion as “groundbreaking” and “explosive,” but it arguably just extends existing law and clearly directs field offices to recognize and process claims arising from sexual stereotyping, including transgender issues.

For over twenty years, the U.S. Supreme Court has recognized that Title VII bars “not just discrimination because of biological sex, but also gender stereotyping – failing to act and appear according to expectations defined by gender.” The Court’s 1998 Oncale[3] concerned a worker harassed for failing to conform to the masculine stereotype of an offshore oil rig worker. In its 1989 Price Waterhouse[4] decision, the Court addressed an employer’s failure to promote a female who was encouraged to be less assertive and otherwise more feminine. Since Price Waterhouse, courts have widely recognized sexual stereotyping as a valid method for establishing discrimination “on the basis of sex” in many scenarios where individuals fail to act or appear in gender-conforming ways.

There are many cases recognizing discrimination and harassment “on the basis of sex” where the allegations arise out of failure to conform to sexual stereotypes. In fact, the EEOC analogized gender-based discrimination as very similar in this respect to religion-based discrimination, saying that while discrimination because one is a Jew or Christian is a forbidden, so is discrimination because one has converted from one faith to another. By extension of the analogy, the EEOC said that “converts” are protected in the gender arena, too.

With the EEOC’s unequivocal guidance, it indeed gets better for America’s transgendered and those not conforming to gender stereotypes.

[1] Gay and Lesbian Alliance Against Defamation, “GLAAD Media Reference Guide, 7^th Ed.” May 2010. [2] US Equal Employment Opportunity Commission Decision, Mia Macy v. Eric Holder, Attorney General, Department of Justice, (Bureau of Alcohol, Tobacco, Firearms and Explosives), Agency, Appeal No. 0120120821 (April 20, 2012).
[3] Oncale v. Sundowner Offshore Services, Inc., 523 U.S. 75 (1998).
[4] Price Waterhouse v, Hopkins, 490 U.S. 228 (1989).

The FMLA Training You Have To Do!

M. Cheryl Kirby — Fri, 06 Apr 2012 00:00:00 -0500

Employers covered by the Family and Medical Leave Act (“FMLA”) generally have a process for designating employee absences as FMLA leave. Unfortunately, they don’t always train supervisors to timely and accurately initiate that process, resulting in problems for the employer.

Take the following common example: an employee calls in sick, giving minimal detail and failing to “request” FMLA leave. The supervisor doesn’t promptly report the absence to HR because he does not recognize that the FMLA may apply. As more sick days are taken, the supervisor eventually turns the matter over to HR. This slow processing can result in the employee ultimately receiving more FMLA leave than the 12-week yearly allotment.

Another, less frequent example, occurs when an employee who is not eligible for FMLA leave becomes “entitled” to it because someone in management said that FMLA covers the absence. In such cases, if the employee relies to his detriment on employer statements that his absence is covered by FMLA, the employer will most likely lose its defense that the employee was not entitled to FMLA leave in the first place.

Because of these and other potential pitfalls in the FMLA designation process, all supervisors must be trained to recognize when any employee’s absence or request for time off should be reported to HR. It is equally important that non-HR supervisors avoid making any comments that an employee could take as meaning his/her absence will be covered by the FMLA. Finally, to reduce the risk of an ineligible employee “remembering” after-the-fact that “my supervisor told me I was on approved FMLA leave,” HR staff should give written notice to employees who are not entitled to FMLA leave explaining the reasons for ineligibility or non qualification.

Although supervisors are not expected to be FMLA “experts,” sufficient training can help them: (1) recognize when FMLA rights may be triggered; (2) remember to notify HR of the situation; and (3) refrain from opining about FMLA entitlement. If you don’t train, you won’t gain from having an FMLA designation process.

Subtracting 46 and adding 49 equals possible lawsuit.

Tiffany G. Hildreth — Thu, 05 Apr 2012 00:00:00 -0500

When you replace 46-year-old Freda with 49 year-old Freddie, it only seems logical that you shouldn’t have to worry about an age discrimination claim. After all, how can anyone reasonably believe that age bias motivated you to terminate Freda when you replaced her with someone who is older?

But, anyone who has ever wrangled in the employment law arena knows that logic, reason and plain old common sense rarely stop a former employee from filing a suit, or force a court to dismiss a case. Oftentimes, the only persons asking the common sense questions are the persons sitting in the jury box. While that may seem somewhat comforting, let’s face it, no employer ever wants to be talking to twelve people in a jury box. The time, expense and anxiety of an employment discrimination trial are just too great, regardless of the outcome.

Well, as we speak, the Texas Supreme Court is considering an issue that might allow Texas employers to sleep a little better at night if they find themselves being sued by Freda for replacing her with three-years-older Freddie. In Mission C.I.S.D. v. Garcia, the petitioner school district employer is arguing that:

When an employee is terminated and replaced by an older person, the terminated employee cannot establish a prima facie case of discrimination under the [Texas anti-age discrimination law].

In other words, Mission CISD wants the Court to affirm that a plaintiff-employee who is replaced by someone older than she is cannot establish a state law age discrimination claim as a matter of law.

“As a matter of law” are golden words for defendant employers, since they mean that the court will dismiss the case through summary judgment and the plaintiff-employee cannot proceed to a jury trial. Even better, plaintiff lawyers may refuse to take on an age discrimination lawsuit knowing that it is essentially doomed from the start.

Does Mission CISD’s argument have any chance of succeeding? Some may be surprised to learn that case law supporting both sides of the argument even exists. But, as employment law arena veterans know, courts, including the arguably more-conservative-than-most Texas Supreme Court, tend to avoid creating those bright-line standards whenever they can. So, don’t be surprised if the Court declines to slam the gate on age discrimination plaintiffs dealing with older replacements and, instead, deems such evidence to be something for a jury to consider. Small consolation for employers who know that the effort and expense of taking an age discrimination case to trial often adds up to far more than one would expect for subtracting 46 and adding 49.

Do Your Facilities Provide All Required Access for Persons with Disabilities under the 2010 Standards?

Katie Anderson — Tue, 03 Apr 2012 00:00:00 -0500

It is time for governmental and private employers to conduct an audit of their facilities. If a facility does not comply, the Department of Justice may be breathing down your neck with an investigation and enforcement, not to mention the private lawsuits that can be brought.

The 2010 Standards Now Apply

The Department of Justice published revised regulations for the Americans with Disabilities Act of 1990 (“ADA”) for Title II (state and local government facilities) and Title III (private facilities that accommodate the public) that became effective just last week on March 15, 2012. These regulations adopted revised, enforceable accessibility standards called the 2010 ADA Standards for Accessible Design “2010 Standards.” The 2010 Standards set minimum requirements for newly designed and constructed or altered facilities to be readily accessible to and usable by individuals with disabilities.

The compliance date for the 2010 Standards for new construction and alterations is determined by:

the date the last application for a building permit or permit extension is certified to be complete by a State, county, or local government;
the date the last application for a building permit or permit extension is received by a State, county, or local government, where the government does not certify the completion of applications; or
the start of physical construction or alteration, if no permit is required.

If that date is on or after March 15, 2012, then new construction and alterations must comply with the 2010 Standards.

A Safe Harbor

The regulations provide a safe harbor for existing facilities that comply with the 1991 regulations as of March 15, 2012. Structures that comply with those previous standards will not need to comply with the 2010 Standards until the facility is altered. Otherwise, all new construction, alterations, and barrier removal will have to comply with the 2010 Standards. Importantly, public accommodations that are covered for the first time will have to comply with the new standards starting now.

Who must comply?

The new obligations apply to owners and operators of places of public accommodation and include virtually all facilities that are open to the public, such as hotels, restaurants, bars, theaters, stadiums, arenas, museums, libraries, parks and other entertainment venues.

By way of example, owners and operators of hotels, motels, and other places of lodging must update their reservations policies, practices, and procedures. See 28 C.F.R. Section 36.302(e). Effective March 15, 2012, an owner, lessor, lessee, or operator of a place of lodging must, with respect to reservations “made by telephone, in-person, or through a third party”:

(i)     Modify its policies, practices, or procedures to ensure that individuals with disabilities can make reservations for accessible guest rooms during the same hours and in the same manner as individuals who do not need accessible rooms;

(ii)     Identify and describe accessible features of the place of lodging and guest rooms offered through its reservations system in enough detail to reasonably permit individuals with disabilities to assess independently whether a given place of lodging or guest room meets his/her accessibility needs;

(iii)     Ensure that accessible guest rooms are held for use by individuals with disabilities until all other guest rooms of that type have been rented and the accessible room requested is the only remaining room of that type;

(iv)     Reserve, upon request, accessible guest rooms or specific types of guest rooms and ensure that the guest rooms requested are blocked and removed from all reservations systems; and

(v)     Guarantee that the specific accessible guest room reserved through its reservations system is held for the reserving guest, regardless of whether a specific room is held in response to reservations made by others.

What should Owner/Operators of Facilities do?

The first step is to identify what regulations apply to your facility and to ensure you are currently in compliance. Specific guidance on the 2010 Standards can be found on this website: http://www.ada.gov/regs2010/2010ADAStandards/Guidance2010ADAstandards.htm.

The next step is to train your employees to be aware of these changes and what they mean as far as new construction or refurbishment goes. Training employees not only helps avoid future violations, but it shows a good faith effort to comply, which can be important when under investigation or in litigation.

Additionally, owner and operators can and must ensure that the experts they hire and rely on for construction services (architects, engineers, etc.) are aware of the new regulations and are able to fully comply with those regulations for all work done.

While many businesses employ and rely on illegal immigrants, even families and individuals must consider the potential liability that comes along with doing so.

Martin Thornthwaite — Tue, 06 Mar 2012 00:00:00 -0500

Just a few years ago, illegal immigrants were estimated to comprise 12 million, or 1 in 20 workers in the United States. To many, these numbers evoke economic issues. As New York City’s mayor reportedly observed, “Although they broke the law by illegally crossing our borders or overstaying their visas and our business broke the law by employing them, our city’s economy would be a shell of itself had they not, and it would collapse if they were deported.”

But, economic impact and business liability are not the only issues. Employment of illegal immigrants by families and individuals can also violate federal civil and criminal laws. Further, since there are a large number of illegal immigrants working in the private household services industry, many U.S. citizens risk violating these laws. A recent, rather extreme, situation illustrates some potential violations.

According to a recently-filed federal criminal complaint, around October 2005, the George family hired an illegal immigrant as a live-in domestic servant responsible for cooking, cleaning, and caring for their children. Although they promised to pay her $1,000 per month, the Georges never completed any employment application, tax forms, or any other documents related to lawful employment. The immigrant spent the next several years working from 5:45 a.m. to 11:00 p.m. every day of the week without any leave time or medical treatment.

Federal authorities intervened when Homeland Security Investigations received a lead originating from the National Human Trafficking Resource Center hotline regarding the alleged indentured servitude of an illegal alien. Now, Ms. George faces both civil and criminal penalties (Mr. George is deceased).

Based on the alleged 17-hour work days, it appears the immigrant was only paid about 85 cents per hour. Thus, Ms. George likely violated minimum wage requirements of $7.25 per hour. Further, an investigation by the United States Department of Labor, Wage and Hour Division indicates that Ms. George may owe the immigrant approximately $206,000 in unpaid wages for nearly six years of work, not to mention any unpaid employment taxes that the IRS may seek from her. Even worse, criminal charges of harboring an illegal alien and possible tax evasion raise the possibility of significant fines and years of imprisonment.

While the George case is particularly egregious, it nonetheless highlights wage, tax, and even criminal law issues related to the employment of illegal immigrants that apply to or should be considered by anyone that chooses to do so.

The Apples and Oranges of Workplace Hostility

Allison Reddoch — Tue, 06 Mar 2012 00:00:00 -0500

Being the mother of two sons, it's hard not compare them. The minute Rhys was born, we pulled out Ethan's baby photos to see how alike they were. While I'm sure we're not alone in comparing our children, I often remind myself that comparing my sons is like comparing apples and oranges – they are simultaneously similar and different, depending on your point of view.

In Hernandez v. Yellow Transportation, Inc., the Plaintiffs tried a similar apples and oranges comparison to prove their hostile work environment claim. Since Title VII prohibits all racial and national origin discrimination and harassment in the workplace, it is understandable that a Title VII litigant would try to use incidents of any racial animus to support his own particular race harassment claims. After all, if an employer promotes or allows harassment against one racial group, isn't it likely that other racial groups are also experiencing harassment at this worksite?

For the time being, such reasoning won't work in the Fifth Circuit. The Hernandez case arose when two Hispanics and a Caucasian sued Yellow Transportation, claiming white employees harassed and sometimes threatened Hispanic employees and their white co-worker friends. The Plaintiffs presented specific incidences of workplace hostility towards Hispanics; however, such incidents were neither "physically threatening nor humiliating" towards Plaintiffs nor did the harassment unreasonably interfere with their work performance. Lacking evidence of sufficiently egregious harassment towards themselves or Hispanics, Plaintiffs also tried to show evidence of discrimination against African-American employees. The Fifth Circuit rejected their proffer, holding that evidence of harassment against one racial group does not necessarily reflect a hostile work environment for employees of other races, absent any evidence of a larger culture of frequent hostility in the workplace. Essentially, Yellow Transportation's possible discrimination against African-Americans did not translate to a hostile work environment for Hispanics.

The Court declined to hold that harassment towards African American employees could never support a claim of hostile work environment by Hispanic employees. Nonetheless, Yellow Transportation offers some guidance for harassment litigants – harassment is not an apples = oranges concept.

More than just a Coal Miner's Daughter, Women have Right to Work in the Mines

Katie Anderson — Thu, 23 Feb 2012 00:00:00 -0500

Last month, the Equal Employment Opportunity Commission ("EEOC") filed a lawsuit against Illinois-based Mach Mining for violating Title VII of the Civil Rights Act of 1964 by failing to hire any female miners since beginning operations in 2006, despite having received applications from "scores of" qualified women.

Despite Loretta Lynn's cautions of the hardship of the job,

Well, I was born a coal miner's daughter,
In a cabin, on a hill in Butcher Holler,
We were poor, but we had love,
That's the one thing my daddy made sure of,
He shoveled coal to make a poor man's dollar...

Coal Minersmore than 60 women have applied to Mach to no avail. "We contacted a number of the women during the investigation and found that these were serious applicants. They had mining certificates, many of them had prior and current mining experience," says EEOC trial lawyer Ethan Cohen. The mine, headquartered in Marion, began operations in 2006 and currently employs over 130 men in various coal extraction jobs. Mach has never hired a single female miner for its Southern Illinois coal mines.

In fact, bathrooms and changing facilities were not even provided for women miners in a new facility, according to a news release from the federal agency

Equal Employment Opportunity Commission (EEOC) says that Mach Mining "needs to realize this is 2011, not 1911." Maybe Ms. Lynn's lyrics, performed brilliantly in the movie production of the film of the same name by Sissy Spacek, need to be reworded (emphasis added):

Well, a lot of things have changed since way back then,
And it's so good to be back home again,
Not much left but the floor, nothin' lives here anymore,
'Cept the memories of a coal miner's daughter.

Mach has until just after Thanksgiving to file a response to the lawsuit. In the meantime, other employers can take note that the EEOC will not view favorably any employer that refuses to hire qualified female applicants, even when the job was historically held only by males and even when it requires physical exertion and tolerance for dirt under the fingernails.

Paper, Paper, Everywhere !?!?

Francine Breckenridge — Wed, 15 Feb 2012 00:00:00 -0500

Yikes! Guess what, as of February 2012, employers will need to comply with more recordkeeping requirements. The Equal Employment Opportunity Commission (EEOC) issued a final rule pertaining to the Genetic Information Nondiscrimination Act (GINA), adding to the EEOC's already extensive recordkeeping requirements. Covered employers must now keep additional files for certain periods of time. What the heck is GINA, you ask? Although it is a blog topic for another day, simply put, it is a federal law that protects individuals against discrimination based on their genetic information when it comes to employment or health care.

The new rule takes effect on April 3, 2012. So, Mr. and Ms. Employer, does this apply to you? It does if you have 15 or more employees or are an employment agency, a labor union, a joint labor-management training program, or a federal employer. Covered employers will now have to

Retain all personnel and employment records for one year from the date the record was made
Retain all personnel and employment records for fired employees for one year from the date of termination
Retain all records relating to a discrimination charge or if a civil action has been brought by the EEOC or an Attorney General until final disposition of the charge or action

Overwhelmed? Well, employers covered by Title VII and the Americans with Disabilities Act should already be keeping these records! The only new requirement is that employers retain records pertaining to a GINA discrimination charge until that charge is resolved. So, instead of a new file cabinet, employers will simply need a new file folder.

The Supreme Giveth and the NLRB Taketh Away

Monica Velazquez — Wed, 01 Feb 2012 00:00:00 -0500

Employment lawyers get excited about the little things – the changes and wrinkles in the law. Arbitration, though not a little thing, is currently undergoing such a wrinkle in time. Last year, after a string of pro-employee rulings, the United States Supreme Court finally issued two opinions which we hoped would help clarify arbitration issues and help employers. First, in 14 Penn Plaza LLC v. Pyett, the Court allowed employers to require employees to agree in advance to arbitration of any statutory claims the employee could later bring in a private proceeding. Second, the holding in ATT Mobility v. Concepcion (a non-employment case), paved the way for employers to require employees to have statutory claims heard individually, rather than as part of a class action. The hope was to curtail class action litigation, especially in the FLSA wage and hour context, that can last for years, at great expense. It appeared employers had received a victory – crucial, although small.

That victory, however, was short-lived. Earlier this month, the National Labor Relations Board (NLRB) issued an opinion that directly contradicted the pro-arbitration stance of the Supreme Court’s 2011 rulings. In a last-minute ruling before the expiration of the terms of two NLRB members, the arbitration hopes of employers were dashed. In D.R. Horton, Inc., 357 N.L.R.B. No. 184 (Jan. 3, 2012), the NLRB held that the employer committed an unfair labor practice by requiring employees to sign a mandatory arbitration agreement which both: (1) forced employees to submit employment-related disputes to binding arbitration; and (2) prohibited the arbitrator from considering these disputes as part of a class or collective action. This opinion resulted from a 2008 case where a former D.R. Horton employee attempted to initiate an FLSA collective action arbitration and the employer relied on the contractual terms of its arbitration agreement with the employee.

The NLRB held that the arbitration agreement violated the National Labor Relations Act (NLRA) because it prohibited employees from participating in protected concerted activity – activity which could help employees organize a union. The NLRB also took issue because the arbitration agreement appeared to limit the rights of employees to file charges with the NLRB. Recognizing the implications of its opinion, the NLRB attempted to distinguish the ATT Mobility v. Concepcion case by noting that in that Supreme Court case involved a conflict between the Federal Arbitration Act (FAA) and California state law; whereas the arbitration agreement in the D.R. Horton case involved a potential conflict between two federal statutes, the FAA and the NLRA.

The result for employers is uncertain. If you have an arbitration agreement that prohibits class actions, you may be following the Supreme Court’s view of the law, but violating the NLRB’s interpretation of the NLRA. If so, you may the target of an unfair labor practices charge filed with the NLRB. If you chose to change your arbitration agreement to comply with the NLRB’s view, you may be opening the way for class or collective actions filed by employees or allowing employees to file an NLRB charge. Doomed (to put it nicely) either way. While it is expected that legislation will be introduced to either undermine or bolster the D.R. Horton opinion or that the Supreme Court will consider the issue years from now, the uncertainty for employers remains. One thing, however, remains certain – employment lawyers will be excited (and will blog) about the next arbitration wrinkle in time.

When Labor & Employment Meets Labor & Delivery

Ginny Webb — Wed, 25 Jan 2012 00:00:00 -0500

With the impending birth of my second child, I have been busily planning for the new arrival in both a personal and professional way. Amidst all of the “to do” items swirling in my head - nursery theme, baby showers, hospital paperwork – I’ve remembered that I will be off from work for more than a long weekend and that I need to review the Family Medical Leave Act. Every year, this Act provides thousands of working parents much needed time off from work to care for a new bundle of joy without worrying about whether their job will be waiting for them when they return. FMLA basics for expectant employees.

Under the FMLA, a new mom (or dad) can take up to twelve weeks of unpaid leave for the birth and care of a child or to care for a child recently adopted or in foster care. Leave can be taken within the first year of the baby's birth or adoption, and/or during the pregnancy. To qualify for FMLA coverage, the employee must: (i) work for a covered employer; (ii) have been employed with that employer for at least twelve months; and (iii) worked at least 1,250 hours in that year. Employers covered under the FMLA include all public agencies (state, local and federal employers), local education agencies (schools), and private-sector employers who employ 50 or more employees in 20 or more workweeks in the current or preceding calendar year. This also includes joint employers and successors of covered employers.

If the employee elects to use her FMLA leave to care for her new child, she must be given her original job upon her return to work. If the original job is no longer available, the employer can offer a job with equivalent pay, benefits, and other terms and conditions of employment. In addition to this guarantee of job restoration, a covered employer must maintain group health insurance coverage for an employee on FMLA leave if insurance was provided before the leave was taken and on the same terms as if the employee had continued to work.

Unusual circumstances when determining eligibility of FMLA leave

Determining FMLA eligibility is not always so cut and dry. As one example, the Eleventh Circuit recently held that a covered employer cannot deny an employee’s FMLA pre-eligibility request if she will become eligible for benefits by the time the leave is needed. In that case, the employee had not been employed for 12 months and worked at least 1250 hours at the time she requested FMLA leave for the anticipated birth of her child, but she would meet the requirements by the time she actually gave birth. The court cautioned that the FMLA must protect against such pre-eligibility interference to avoid creating a loophole for employers to terminate an employee before she actually becomes eligible for the requested FMLA leave.

Another unusual situation could arise where spouses are employed by the same employer and both request FMLA leave for the birth and care of a new child. In this case, the covered employer need not grant a total of 24 weeks of leave to the new parents. Instead, the spouses are limited to a collective 12 weeks of leave to be divided between the two of them however they see fit.

Of course, the FMLA covers so much more than expectant parents that will return to work. It is important to remember the various triggering events, the employees that might be covered, and qualifications the employer and employee must meet when faced with making an eligibility determination. Now that I feel assured that my job will be here for me when my 12 weeks is up, I can focus on the big issues … like Pampers versus Huggies.

I Need More Employees Like That...Uhh, on Second Thought, No I Don't

Jana H. Woelfel — Thu, 19 Jan 2012 00:00:00 -0500

I can imagine many Americans reading this headline and getting angry, "Chicago Woman Fired for Doing Work at Lunch Wins Unemployment Claim." But in the words of a childhood favorite of mine, it is important to know "the rest of the story."

Sharon Smiley, a ten year tenured receptionist for a Chicago real estate company, was fired for working through lunch. Yes, you read that correctly, she was fired for working through lunch.¹ Company policy at her employer, Equity Lifestyle Properties, Inc., required all hourly, nonexempt employees to take a 30 minute lunch break. However, on January 28, 2010, Ms. Smiley clocked out for lunch, but returned to her desk at the front of the office and began working on a spreadsheet on her computer, answering the phone and responding to questions for those who approached her desk (the sort of things she did as part of her regular job duties). A manager saw what she was doing and told her to step away from her desk and go to lunch. Ms. Smiley refused and was terminated. You might be thinking, "What? Is the company nuts? If only I had 10 employees like Ms. Smiley the things I couldn't do!" But, there was a method to the employer's madness.

First, Illinois law requires unpaid meal breaks of at least 20 minutes be given to employees who work 7.5 hours or more in a given day. The employer's policy requiring lunch simply was compliant with Illinois state wage and hour law. Crazy as it may sound, permitting Ms. Smiley to work through lunch could be a violation of the law by Equity Lifestyles. Second, federal wage and hour law requires that an employer pay an employee for all hours the employer "suffers" or "permits" the employee to work. If the employer knows or should know that the employee is working, the time must be paid. So, putting aside the legality of working through lunch under state law, if Equity Lifestyles knew Ms. Smiley was working while she was clocked out, then they were required by law to pay her for the time she was clocked out, and have the dubious honor of having to explain, if the question was posed by the DOL or a court, exactly why their time records do not accurately reflect the hours worked by their employees -- something else that is a violation of the law. Moreover, if Ms. Smiley was scheduled to work 40 hours a week and the time spent working through lunch carried her over the 40 hour regular time limit imposed by the Fair Labor Standards Act, then her employer is required to pay her overtime at time and half for any time in excess of 40.

Unfortunately, despite the way it sounds in the national news, Equity Lifestyle's approach of having a policy that complies with state law requirements and asking its employee to comply with those requirements was appropriate. It was also appropriate for Equity Lifestyle's management to ask an employee who is not complying with policy and may subject the company to liability to stop and take the lunch break required by company policy (and state law). It is also appropriate to discipline, and even terminate, employees who refuse to comply with company policies. When Ms. Smiley refused to follow company policy, even after management's reminder of that policy, she may not have appreciated that she had stepped out of the bounds of being a real asset to the company and had become a real liability to company, but that is a fair way for the employer to view her refusal. Ms. Smiley may have had the best intentions (and we all know where that road leads), but Ms. Smiley would probably still be smiling at Equity Lifestyle's front desk if she had simply followed directions.

¹See article in national news: http://gma.yahoo.com/chicago-woman-fired-doing-lunch-wins-unemployment-claim-145926016--abc-news.html

Ministerial Exception

Tiffany G. Hildreth — Fri, 13 Jan 2012 00:00:00 -0500

In our October 31st newsletter, we told you about an interesting case pending before the United States Supreme Court, Hosanna-Tabor Evangelical Church v. EEOC. The Hosanna case concerns a very narrow employment issue applicable only to religious organizations - whether such organizations can avoid most employment claims based upon the "ministerial exception." This exception grows from the core separation of church and state principles which are highly unlikely to affect most employers.

The Sixth Circuit had found the ministerial exception inapplicable in this particular case, thereby allowing the religious organization employee to proceed with a disability discrimination claim. The Sixth Circuit simply found that the employee didn't perform enough religious duties to warrant the organization's exception defense - she only performed religious duties during 45 minutes of her workday.

We queried whether this "quantity versus quality" approach would stand. It did not.

In its first acknowledgement of the ministerial exception, the Court said that the Sixth Circuit placed too much importance on the limited amount of time she performed religious duties. Chief Justice Roberts explained, "The issue before us ... is not one that can be resolved by a stopwatch." The Court found the exception applied given the nature of her duties.

Look for our newsletter to further discuss this case.

Is Staying Out of Court on your List of New Year's Resolutions?

Monica Velazquez — Fri, 30 Dec 2011 00:00:00 -0500

I live by "To Do" lists, which help me get things accomplished from work to shopping, and everything in between. Perhaps the most significant "To Do" list is the one we should be considering and writing in the next few days - our resolutions for 2012. While many resolutions involve bad personal habits we would like to break, the more important resolutions are the ones we set in our professional roles for our workplaces. Recently, I read an article that recommended only one New Year's resolution: staying out of court as an employer. Easier said than done, but keeping in mind some of the lessons from this year, here are five important resolutions to get your list started:

Read your policies. When was the last time you read your employee handbook or policies? If you have ever had the "pleasure" of being deposed in a case, you know that this question is commonly asked. It would be great if you could honestly answer that you read your handbook in January 2012. It would be better if you could also answer that, as a matter of course, you read your handbook and always make necessary revisions every January.
Hire carefully. Many situations which eventually end up in litigation stem from bad hires. While you don't have a crystal ball to predict all hiring decisions, using a well-defined meticulous process that helps you screen candidates and taking time to carefully evaluate candidates should help you avoid major mistakes. Resist the temptation to make quick hiring decisions without checking references or running background checks, with proper authorization if necessary. Teach your hiring managers to also resist the urge to screen applicants using social media or casual Internet searches. For example, a few years ago, if you had ran a quick Internet search under my maiden name you would have come across the mug shot of a woman in Florida. Mind you, I have never been arrested and never lived in Florida. During the hiring process, a simple Internet search can result in liability.
Deal with issues when they happen. We frequently get calls from employers who want to fire employees for a whole host of issues which have built up over months or years, but have never been documented. If you do not document, small problems will turn into large issues. It is also not fair to the employee who assumes that his or her behavior is appropriate. Can't you hear it now: "You didn't say anything when I was coming in late for months, so why is it a problem now? Is it because I requested disability leave yesterday?" Employees who are surprised or blind-sighted by their terminations will almost always blame it on impermissible discrimination or retaliation and file suit.
Train your employees and supervisors. There is no such thing as too much training. Recent changes in a number of employment laws, such as the FMLA, make training crucial for your employees and front-line supervisors. Training should be frequent and practical, including helpful examples. Since there has been an increase in complaints and litigation involving retaliation, training helps employees understand what unlawful retaliation really means and what is or is not protected by law. For example, the United States Department of Labor recently issued new Fact Sheets in an effort to educate employers on retaliation protections under the FLSA and the FMLA. The Fact Sheets include helpful examples of prohibited conduct that should be part of your workplace training.
Set a good example. This is the Golden Rule for your workplace. You can have the best policies and comprehensive training in place, but without your supervisors setting a good example and consistently enforcing your policies, it will not matter. Resolve now to take some simple steps to make next year easier by teaching your supervisors - and yourself - to drop old habits and renew efforts to keep you out of court in 2012.

Three Cheers for the Office Holiday Party!!

Jana H. Woelfel — Mon, 12 Dec 2011 00:00:00 -0500

It's that time of year, again. The season of fun, frenzy, and the ever-festive office holiday party. In that spirit, we devote today's blog entry into a discussion of how to keep your "fa la la la la" from becoming more of an "ooh la la?"

The Easy Stuff

Start with the obvious - alcohol. Many companies serve it, but just as you wouldn't (or shouldn't) swallow the entire cold-boiled shrimp array, go easy on the alcohol. And, just in case you are feeling particularly merry, "No, Virginia, a holiday party is not the time to pound back tequila shots." It is still a work-related event, no matter how much sparkle and holly decorate the room. Companies always want "professionalism" and "good judgment" from their employees, even at the holiday party. Ignoring this simple edict can, at worst, cost you your job and, at best, make you the butt of office jokes for holidays to come.

Also obvious - dress. Holiday parties often invite attire that is more festive than the everyday office setting permits. You've heard it before, but its true -- a good rule of thumb is to follow senior management's lead, meaning know your audience. Even if your senior VP is a Ms. Hathaway-in-training, with her navy wool knee-length skirt suit, sensible pumps and Santa earrings, just go with it. Really, go with it. Perhaps you spice things up with a red blouse or skirt, but if Ms. Hathaway doesn't sport skirts 3 inches below the butt, keep your fabulous legs to yourself if you want to advance to VP (or to work with anyone at that level). And, while your lame' halter and Santa Baby thong peeking out of your shiny black leathers would rock the club, do you really see Ms. Hathaway rocking anything?

If my admonition about visible thongs implies that undergarments aren't advisable, know that underwear can, in fact, be your friend. I can think of too many holiday parties with late-night dancing where a skirt rode up or someone fell while going as "low they could go," showing coworkers just why the dancing queen avoided the dreaded VPL a/k/a visible panty lines. While the paparazzi might be rewarded for a flash of a young starlet's "Britney," rarely are such kudos given at work.

The Not-So-Easy Stuff

I know it doesn't sound like fun, but an office party is a work-event. Ideally it should be one of the more enjoyable times you've spent at work, but it is still work.

Your momma always told you to say please and thank you. Do so. Take a moment to thank senior management for hosting the party (preferably before you have had so much to drink that you also tell the senior manager just how "hawt" you think he is…). Trust me, this has happened.

To repeat myself, the office holiday party is not a club, even if it is held at a club. Tricky, I know, but true. If you go to a club, you are not obligated to visit with the people at the next table. However, at the office party, you are expected (and in fact, encouraged) to visit with coworkers. Certainly if you are seated at a table with coworkers, you should politely make small talk. And lest I not be clear, make the small talk with the people at the table, as you mingle, at the bar, and in the food line, in other words, those actually at the party, not those great friends who you want to text about how lame the party is since you are not getting schnockered. You can do that (text, not get schnockered) - just save it for the corridor outside the party, the bathroom, or the ride home with your designated driver.

However, just in case you don't remember from your manners class in junior high, small talk is defined as "casual, trivial conversation for social occasions." Practice beforehand, if need be. This is not the time to demonstrate your budding career as a comedian by mentioning that a coworker's spouse is in Iraq, but due home soon for a "conjugal visit." Yes, Virginia, these things are said by presumably well-meaning individuals, but you don't want everyone looking around thinking, "Awkward!" Nor is it the time to tell a coworker that you think anyone with his politics is a raving lunatic without an ounce of common sense. You can think it, but you can't say it. This is another reason to moderate your intake of alcohol.

In a similar vein, unless your boss (or her boss) has asked you to come to the party and spend the entire time cornering coworkers to talk about the latest widget run at the company factory, this is a time for small talk (see definition above), not detailed work talk that would make the most patient spouse or significant other long to pull out his cell phone and start texting.

The Funny Stuff

Assuming you've heeded my advice and been the polite, delightful party guest attired conservatively and drinking judiciously, there is still one last bit of advice. Be aware of your surroundings, don't monopolize on any one partygoer's time and always be careful how you pose for photos. You might end up with your photo plastered all over Facebook like the poor young lady below:

You've Got the Look (NOT)

Francine W. Breckenridge — Thu, 17 Nov 2011 00:00:00 -0500

I love Ellen DeGeneres. She is funny, smart, and one heck of a dancer. I even like the way she dresses. A hotel chain in midwest America apparently disagrees with me. Heartland Inns hired a fresh-faced young female by the name of - let's call her Ms. Boyish - in July 2005. Ms. Boyish held several positions with Heartland, performing each of them well. She was finally promoted to the ultimate position of front desk clerk and, all of a sudden, her problems began. According to Heartland's Director of Operations, Ms. Boyish did not have the "Midwestern girl look" that was needed for a front desk position. She was supposedly a "tom boy" and (oh my!) she dressed like Ellen DeGeneres. Ms. Boyish was fired and sued. The appeals court held that Ms. Boyish had a viable claim for gender stereotyping and retaliation against Heartland. One judge dissented, stating that this decision could allow employees to sue under Title VII if an employer refuses to hire a cheerleader because she does not have the "cheerleader look" or a fashion model because she/he is not good looking enough.

So what is an employer to do? Generally, courts allow companies to implement employer-adopted appearance standards. Appearance policies must be carefully drafted and uniformly applied to avoid claims that such policies go beyond an employer's legitimate interest in keeping up a particular image for business purposes. The policies cannot simply enforce a sexual stereotype. For instance, companies can require both males and females to look "professional." However, employers cannot mandate what they believe constitutes a "professional" look. There is a stark difference between requiring all employees to wear business suits versus requiring all men to wear business suits and all females to wear dresses with nylon hose.

WAIT WAIT! …. ON THAT NEW POSTER

Monica Velazquez — Fri, 14 Oct 2011 00:00:00 -0500

In August, we told you about a new poster which most employers were required to post by November 14, 2011. Well, hold onto those thumbtacks; there has been a slight reprieve.

In late August, the National Labor Relations Board (NLRB) announced a final rule requiring employers to post a notice of Employee Rights under the National Labor Relations Act (NLRA) poster. This requirement applies to private employers, including non-profit employers, and unions, but excludes agricultural, railroad and airline employers, as well as small employers that conduct an insufficient volume of business to fall under the jurisdiction of the law – the NLRA – which the NLRB enforces. The surprising aspect of this new requirement is that it applies to most employers – including those without any unions – because NLRA rights apply to union and non-union workplaces, according to the NLRB.

As you can imagine, a bit of panic ensued after the final rule was published and the NLRB received more than 7,000 comments from employers, employees, and unions, a majority of which objected to all or parts of the final rule. As a result, the NLRB issued a press release last week announcing its decision to postpone the implementation date for the notice until January 31, 2012. Hopefully, this will allow for increased education and outreach to employers, many of which find it unsettling to hear the words “union” and “rights” in their workplace. The delay will also will provide time for the NLRB to review and analyze actions challenging the notice and the NLRB’s authority to create or enforce a rule requiring the notice, such as a lawsuit filed in federal court by the U.S. Chamber of Commerce and others.

While the NLRB will not fine employers for failing to post the notice, the failure can result in a charge of an unfair labor practice under the NLRA, which may eventually result in sanctions. Further, if an employer knowingly and willfully fails to post the notice, the failure also may be considered evidence of unlawful motive in any unfair labor practice case involving other alleged violations of the NLRA. Accordingly, the safer course of action is to post the notice by the January 31st deadline. The notice is available for free at:
http://nlrb.gov/sites/default/files/documents/1562/employee_rights_nlra.pdf

How Being Best "Gluer" Makes Me a Better Lawyer, Mother, Preacher's Wife and Now MBA Student

Kimberly S. Moore — Fri, 16 Sep 2011 00:00:00 -0500

That's right, I won - and not when I was five, but in high school I won an art competition for a collage a/k/a excellence in gluing. This is where I confess that I am a competitive adrenaline junkie - I feel best - most productive - when I am focused and fully engaged (and honestly, winning is a bonus). I bet there are others out there, too. So winning, even for this lame, self-described best gluer project, led me to what some would describe as a mid-life crisis but what I describe as my life invigoration plan - as currently every part of my life is energized.

I took the plunge and joined the SMU Cox EMBA program with 84 gifted, inspired, and now sleep-deprived classmates. Given that I work fifty hours most weeks, have two great children, a wonderful husband and sit on three boards, finding the extra time that school requires is both challenging and, so far, worth it.

So how does this work for me? Weekdays start very early (yes, usually with a 4 on the clock or at the latest. 5) with a run or boot camp; part of the adrenaline thing. The workout gives me more energy and endurance for long days/weeks. I can shower, eat, play with the dog, interact with my children (if they are awake) and be at work by 7:45 with my lunch (sometimes my sweet husband packs it for me - yea!). I confess that on the way to work I either listen to assigned reading from our organizational behavior book on my iPad or mindless reality television. Not necessarily a bad thing, in fact, I thought of titling this "How Z-scores and T-accounts Saved Me from Reality TV." I have otherwise given up all forms of television. That does not mean that there is not a Rangers or Cowboys game occurring in the background as I study, a spousal benefit-uninterrupted games without dancing or singing shows.

Once I get to work, I really enjoy what I do. I get to help employers solve problems and every day is different. This week I got to ask a witness questions about allegedly seeing unwanted email and argue in court (winning is a bonus!). Most days I also spend an hour during the day studying statistics or accounting.

I try to leave work by 7:00 p.m. I have dinner with my family at home almost every night. We have worked to have healthy meals and we get to talk with Mere and Alex about their day. I have the extraordinary blessing of having my mom as the nanny. So Mere and Alex have all of the great activities, music, dance, etc. in Grandma's taxi.

After dinner, I water the flowers, play with the dog, review email, and yes, work or study for a couple of hours.

Our MBA class meets every other Friday and Saturday, all day. Given my forty something years (the mid-life crisis part) it is difficult for me to sit for four hours straight. It feels like I am training for a marathon, the days are long. Sometimes I do not sleep that well, thinking about a case or a class. However, I really want to do this; I am fully engaged and energized. The others in the MBA program are terrific. I plan to introduce them to you in the future.

YOU ARE THE BEST BOSS IN THE WORLD!

Francine W. Breckenridge — Fri, 02 Sep 2011 00:00:00 -0500

Your employees love you - The Best Boss In The World! - and they really love your company’s product —Fantastic Fabulous Flippities!. So, what do your employees do? They brag! They tweet that Fantastic Fabulous Flippities are the best flip-flop in town, putting all other sandals to shame. They Facebook that if consumers buy anything other than Fantastic Fabulous Flippities, they will be SO disappointed. They IM that “cool” people own Fantastic Fabulous Flippities. As their boss, you love your employees for promoting your wonderful product and hopefully increasing sales.

One day, the Federal Trade Commission (“FTC”) knocks on Fantastic Fabulous Flippities’ door. Is The Best Boss In The World in trouble? Yes. FTC guidelines on advertisement endorsements and testimonials require employees promoting or endorsing company products or services to clearly and conspicuously disclose their employment relationship. Failure to do so imposes liability on the endorser AND the company for failing to disclose “material connections” (which includes employment relationships) existing between endorsers and the companies about whom they comment. Since these guidelines specifically include social networking, an FTC endorsement action could potentially be brought against Fantastic Fabulous Flippities because its loyal employees commented on company products or services without disclosing their employment relationship.

Lesson learned: Employees can promote and endorse Fantastic Fabulous Flippities all they want as long as they clearly and conspicuously disclose that they are Fantastic Fabulous Flippities employees. Moreover, if you, as The Best Boss In The World, actually pay an employee to endorse Fantastic Fabulous Flippities, the employee must also disclose that he/she is being paid for the endorsement.

Is it the end of the “dates of employment” question?

Tiffany G. Hildreth — Tue, 30 Aug 2011 00:00:00 -0500

This summer, Congress proposed new legislation that would prohibit employers with fifteen or more employees from "refusing to consider for employment, or refusing to offer employment to an individual, because of the individual's status as unemployed." The bills - H. R. 2501 and S.B. 1471 - are still in committee and may ultimately perish. Nonetheless, employers should keep track of their progress because, if passed, they have some teeth.

A party may seek to enforce the proposed law through a private suit in Federal or State court, or by complaint to the Department of Labor. If he prevails, damages for wages, salary, benefits or other compensation denied or lost to the individual, as well as liquidated damages, interest and attorney fees could be awarded. Moreover, the bills contain anti-retaliation provisions protecting parties who seek to enforce rights under the statute.

If passed, employers could easily withdraw job postings that explicitly require applicants to be currently employed. The harder part may be if the bills encompass both current and past unemployment. As currently drafted, the bills appear to focus on the individual's current unemployment status. The bills' stated purpose, however, is to "prohibit discrimination in employment on the basis of an individual's status or history of unemployment." If these conflicting provisions are ever reconciled to include "history of unemployment," the standard questions related to dates of employment may need to be, um, canned.

Put your poster up by Thanksgiving!

Tiffany G. Hildreth — Tue, 30 Aug 2011 00:00:00 -0500

In case you haven't heard, by the time your employees head out for the Thanksgiving holiday, your office will need to have a new poster on the wall. On August 30, 2011, the Federal Register is expected to publish a new rule from the NLRB requiring private employers (with few exceptions) to affirmatively notify their employees of their rights under the NLRA. This new rule should be effective by November 14, 2011, or 75 days after its officially published in the Federal Register.

You can access copies of the NLRB's proposed notice, in English and other languages, through the NLRB's website at http://www.nlrb.gov/.

If You Can’t Take the Heat Download the New OSHA App

Ginny Webb — Mon, 22 Aug 2011 00:00:00 -0500

Here in Texas, it has been extremely hot and, if you're like me, you have been grateful to step into the air conditioning every day as you go to work. Some folks, however, spend their work days outside no matter what the mercury reads.

Every year, thousands of workers suffer from heat-related illnesses. Industries that experience the highest rates of heat related illness include construction, farming, roofing, landscaping, and air transportation. The U.S. Department of Labor recognizes the toll that extreme heat can take on these workers and that employers need to learn ways to help the workers stay safe and healthy. Making good use of accessible technology, the DOL's Occupational Safety and Health Administration recently announced the release of a new mobile device application that assists workers and their supervisors who work in these extreme heat conditions. Secretary of Labor Hilda L. Solis commented that "[h]eat-related illnesses are preventable [and t]his new app is just one way the Labor Department is getting that message out."

The app helps determine the necessary protective measures by combining the heat index data from the U.S. National Oceanic and Atmospheric Administration with the user's location. Those using the app will find helpful information such as precautions to take, signs and symptoms of heat-related illnesses, and first aid steps to take in an emergency. Supervisors can also take advantage of the information provided on how to build up the workload for new workers and how to train employees on heat illness signs and symptoms. All information is available in English and Spanish and, importantly, users can contact OSHA directly through the app.

Providing water, scheduling breaks in an air conditioned area or the shade and training workers on the risks and warning signs of heat-related illness all help protect employees from these dangerous conditions. The DOL's latest app should not supplant these common sense precautions. But, it certainly can't hurt to have it on hand because it doesn't look like the scalding temperatures are going to subside any time soon.

The Home Repair Man Sitting in his Van in Front of your House is Probably not Casing the Place but Completing Paperwork before he Heads Home so the Company is in Compliance with the Fair Labor Standards Act

Katie Anderson — Fri, 05 Aug 2011 00:00:00 -0500

What the heck do those home repair workers do between the window when they will be to your house between 6 a.m. and midnight? Interestingly, they may not be getting paid – at least not for their travel at the beginning and end of a work day. For those of us in the jurisdiction of the Fifth Circuit, like Texas, this practice has been found to comply with the often strict standards of the Fair Labor Standards Act (“FLSA”).

On June 15, 2011, the Fifth Circuit ruled in favor of Sears Roebuck and Co. by upholding the granting of summary judgment in a suit brought by two in-home service technicians who serviced and repaired appliances in customers’ homes. Chambers v. Sears Roebuck and Co., 2011 U.S. App. LEXIS 12150 (Fifth Circuit, June 15, 2011). The technicians used company-owned vans and were part of the voluntary Home Dispatch Program, which allowed them to report directly to the first customer in the morning and return directly home at the end of the day. The technicians were only paid for the portion of their commute either way that exceeded thirty-five minutes.

The technicians alleged they had been denied overtime compensation in violation of the Fair Labor Standards Act (“FLSA”), which provides as follows:

“no employer shall employ any of his employees… for a workweek longer than forty hours unless such employee receives compensation for his employment in excess of the hours above specified at a rate not less than one and one-half times the regular rate at which he is employed.”

29 U.S.C. § 207(a)(1). The FLSA does not define “work” or “workweek.” However, the Portal-to-Portal Act narrows the scope of compensable activities by excepting two categories of activities that had been compensable under prior Supreme Court precedent interpreting these terms. Employers are not liable for failing to compensate employees for these activities:

walking, riding, or traveling to and from the actual place of performance of the principal activity or activities which such employee is employed to perform and
activities which are preliminary to or postliminary to said principal activity or activities,

which occur either prior to the time on any particular workday at which such employee commences, or subsequent to the time of any particular workday at which he cases, such principal activity or activities.

29 U.S.C. § 254(a). Congress amended the Portal-to-Portal Act in 1996 with the passage of the Employment Commute Flexibility Act, which clarifies that payment of wages to employees who use employer-provided vehicles for travel need not be compensated if (1) the travel is within the normal commuting area for the employer’s business or establishment and (2) subject to an agreement on the part of the employer and the employee. As such, normally, home-to-work travel is not compensable in the absence of a contract that states otherwise.

So why did Sears win this case? Sears and its lawyers proved several critical facts of how they run their Home Dispatch Program which employers may also want to do if allowing employees to make service calls directly from their home:

Allow technicians to choose whether they participate in the Home Dispatch Program or whether they want to come to a central location to first start their day;
Conduct studies of employee commutes before establishing a thirty-five minute commute time that isn’t compensated;
Pay for time spent commuting in excess of the average commute time (i.e. thirty-five minutes) and for all service calls in between the first and last calls of the day;
Pay for all commuting expenses related to the service vehicles, including gas, maintenance, and insurance;
Establish time spent on other tasks (i.e. to call or dial in to learn of the first assignment, receiving packages and placing the boxes of parts, unopened, in the van) takes a de minimis amount of time (here it took an average of 8.5 seconds) and pay for any time that exceeds that minimal amount (i.e. Sears paid when any employee had to contact an outside vendor for technical assistance);
And perhaps most importantly, require that prior to beginning the commute home, technicians — while still on the clock — engage in winding down activities such as completing paperwork, putting funds from the day’s calls in envelopes and documenting parts usage.

The Sears case provides a great discussion of the FLSA and why and how an employer can comply when employing workers to travel in company vehicles directly from home to their service calls and home again. Now, if someone could just narrow that window of time I have to wait to get my washer fixed!

The Case of the Missing Hot Dogs

Jana H. Woelfel — Thu, 14 Jul 2011 00:00:00 -0500

Independence Day a year ago, a certain Mr. Nolan Koewler of Indiana enjoyed two of the most expensive hot dogs he will ever eat. How that happened is one of those crazy stories you have to read to believe.

Mr. Koewler was an employee of Dillard’s in Evansville, Indiana. On July 4, 2010, Dillard’s in a display of patriotism and employee camaraderie-building hosted a cookout, providing hamburgers and hotdogs for its employees. That sounds delightful, and by all accounts a good time was had by all at the company cookout. Unfortunately, though, disaster loomed ahead of the expensive, employment-law variety.

Dillard’s Dock Manager, Mike Marz, who had purchased the meat on Dillard’s account, had a brainstorm. He testified that he instructed the employees to place all the uneaten hamburgers and hotdogs in a freezer in the company break room to be saved for Labor Day. While this author is all for not letting food go to waste, this suggestion raises all sorts of questions about when the food was first prepared when one is eating at a Dillard’s company event, but back to the story.

Mr. Marz instructed his staff to put the leftover food in the freezer in the break room for “storage,” but there was some confusion about the instruction as the food was actually placed in the break room refrigerator. Regardless of Mr. Marz’ intent that the food be saved for the next employee celebration (and regardless of whether it could have been saved after spending the intervening time in the refrigerator rather than the freezer), there was no testimony he communicated that intent to re-serve the food at a later date to the employees. Mr. Marz testified he “believed” Mr. Koewler heard this instruction that the food was to be placed in storage. This fact will be critical to our story.

The following day Mr. Koewler was working again. Feeling a little peckish, he casually took two hot dogs from the company refrigerator. Gasp! Mr. Marz discovered the missing hot dogs and promptly flew into investigative mode. Now a sleuth of sorts, Mr. Marz determined that six Dillard’s employees had access to the refrigerator during the time in question. Continuing on in Holmesian fashion, Mr. Marz pulled and reviewed the company’s surveillance video to determine who would have misappropriated this valuable company property, and promptly concluded that Mr. Koewler was the culprit, although another employee was also accused of “theft of leftovers.”

Naturally, given the gravity of the offense, Mr. Koewler was called into a disciplinary meeting with the Dillard’s store manager and confronted with the evidence of his pilferage. Unlike some villains who make things worse for themselves by lying (and provide a handy, separate ground for termination), Mr. Koewler was fiendishly clever and admitted to his thievery of the two hotdogs.

Apparently Dillard’s means it when it posts signs in its dressing rooms that shoplifters will be prosecuted to the full extent of the law. Dillard’s was not about to let such flagrant disregard for the company’s property rights go without appropriate disciplinary measures. So they did what they felt was appropriate under the circumstances given the serious nature of the offense. Naturally, they summoned a local police officer who advised Mr. Koewler that his verbal admission to the store manager was insufficient; he must either (1) sign a statement that he had stolen the two, at least day-old, hotdogs from the company refrigerator, or (2) spend the night in the local jail. Mr. Koewler, whose stomach by now was undoubtedly queasy from the hotdog caper and its fallout, signed the statement and was summarily fired by Dillard’s.

A casual reader might assume this sad tale ends there, but alas not. Mr. Koewler, now out of work in Indiana in the midst of a recession, begins to appreciate that free hotdogs don’t just grow on trees or magically appear in refrigerators, and applies for unemployment benefits. The Indiana Department of Workforce Development finds that Mr. Koewler is in fact entitled to unemployment benefits because he was not discharged for just cause. Indiana’s rule is apparently similar to the Texas rule which provides that employees who are discharged for job-related misconduct are ineligible for benefits. Tex. Labor Code § 201.012. In Texas, job-related misconduct means mismanagement of a position of employment by action or inaction, neglect that jeopardizes the life or property of another, intentional wrongdoing or malfeasance, intentional violation of a law, or violation of a policy or rule adopted to ensure the orderly work and the safety of employees. Typically, in Texas, job-related misconduct involves things such as violation of company safety policies, insubordination, falsification of employment records, and theft. Dillard’s considered this a case of theft.

Dillard’s, clearly not a company to allow someone to get something to which they are not entitled, promptly appeals the decision to an Administrative Law Judge, who affirms the original decision – firing Mr. Koewler for filching two hotdogs is not just cause, noting that the forbidden hotdogs were those “destined for the freezer” and the “hotdogs at issue were retrieved from the refrigerator.”¹ Not to be deterred because of two setbacks, Dillard’s appeals to the Review Board who determined that the firing was, in fact, for just cause, for failing to protect company assets.

This time, Mr. Koewler, who was representing himself pro se throughout this process, appealed to the Indiana Court of Appeals. Indiana was capably represented by its own Attorney General and Assistant Attorney General. Fatefully, on July 7, 2011, just a year and two days after Mr. Koewler’s ill-fated snack, the Court of Appeals issued a published opinion holding that Indiana defined “just cause” as “any breach of duty in connection with work which is reasonably owed an employer by an employee.”² After weighing the meaty evidence, the Court of Appeals reversed the Review Board, determining that while Mr. Koewler admitted to nabbing the hotdogs, no proof exists to support that he knew that by doing so he was partaking of the forbidden fruit, so to speak.

The Court of Appeals opined that it is unclear what value the leftover hotdogs in the refrigerator had, noting “[w]e assume that the two hotdogs in storage lacked great market value and that the intrinsic value to Dillard’s was diminishing as the safe consumption date approached.”³ The Court of Appeals went further in its analysis, finding,”[t]he record reveals that employees had been offered hamburgers and hotdogs for consumption; it does not reveal that the rescission of this offer of celebratory food was in fact communicated to Koewler.”⁴ Thus, the Court of Appeals found that there could be no theft under Indiana law as there was no evidence that Mr. Koewler knowingly or intentionally exerted unauthorized control over the hotdogs.⁵

Although we will pause here, this is probably not the end of this sad tale. Dillard’s may choose to appeal to the Indiana Supreme Court, although I doubt their public relations people would recommend it. Naturally, after the Court of Appeals issued its opinion, the case was picked up by the national press who has written about the case with much the same incredulity expressed here.

Although hindsight is always 20-20, one must ask Dillard’s whether it was worth it. Even assuming Evansville Dillard’s local management wished to address the case of the missing hotdogs as a serious internal matter, might a written warning have been more appropriate? Once Dillard’s terminated Mr. Koewler, might Dillard’s human resource team or counsel have advised the Evansville store that it might be a better public relations move to permit Mr. Koewler to receive unemployment benefits, rather than opening this matter up to further scrutiny and potential claims that Mr. Koewler was treated differently (perhaps discriminately) than the other employee accused of theft? From a simple risk relative to reward standpoint, Dillard’s failed to keep this one on a leash.

A good rule of thumb is to take a step back and imagine explaining the decision to the local investigative reporter on the 6:00 p.m. news. If the story isn’t something that would go over reasonably well there, it may be appropriate to rethink the company’s approach to the decision. This modern parable serves to remind all prudent employers that it is crucial to evaluate employment decisions at critical milestones to avoid biting off more hotdog than the company can chew.

¹ N.K. v. Review Board, No. 93A02-1012-EX-1431.

² Koewler v. Review Board of Indiana Department of Workforce Development and Dillards Inc., No. 93A02-1012-EX-1431 (Ind. Ct. App. July 7, 2011). A complete copy of the Indiana Court of Appeals July 7, 2011 decision is attached for your amusement.

³ Id. at fn.3.

⁴ Id.

⁵ Id.

Pilots, Interns and the Good Ole FLSA

Kimberly S. Moore — Mon, 27 Jun 2011 00:00:00 -0500

I recently received a letter from a pilot who is also a law student seeking work (and no it was not the Southwest pilot who managed to insult virtually everyone with his open mic). The interesting thing about the letter was that the law student, I will call him Bob, was volunteering to work for free. The well written letter explained that since Bob was employed as a pilot, he did not need the money or benefits but, instead, given the economy, he needed a part-time law job that could provide experience. I am certain he was hoping to trade his life in the cockpit for life in the courtroom at the end of his summer volunteer program. While it would always be great to have an extra person's help, especially for free, I could not accept the offer.

The Department of Labor interpreting the Fair Labor Standards Act has made it clear that there are very few situations where unpaid internships are legal. Yes, that means when the boss wants to let the neighbor’s kid work for experience, it is usually a bad idea.

Given that it is usually a bad idea, there are exceptions, and that is why you know of many unpaid interns. Either the employers are not complying with the law or they are able to be meet all of criteria. First, if the intern is going to be doing the type of work the business generally performs (like legal work in Bob’s request), the training must be similar to what he would receive in law school. Second, the internship experience must be for the intern’s benefit, it is not free labor. Third, the intern cannot displace regular employees, such as those on vacation, and work under the close supervision of existing staff. Fourth, there is no immediate advantage to the employer, and instead, due to the educational investment, operations may actually be impeded. Finally, there is no guarantee of a job.

I am certain Bob was not aware of the many implications of volunteering to work for free. The summer school lesson is that in most instances it is far better to pay the interns (and, of course, to never speak with an open mic).

Employer Flagged For FMLA Interference

Francine W. Breckenridge — Fri, 17 Jun 2011 00:00:00 -0500

The FMLA provides leave for employees due to a serious health condition.” If an employer has requested and obtained a certification from the employee’s health care provider confirming the serious health condition, the FMLA allows it to request a second, independent assessment. However, if the second opinion states that the health condition is not serious, employers need to get a third “tie breaker” opinion or else they may be flagged for FMLA interference.
In a recent case, Ms. “Illoise Sicker” began experiencing severe headaches soon after receiving written and verbal warnings from her supervisor. Her treating doctor certified that the headaches created a “serious health condition” that qualified her for FMLA leave. Of course, her employer’s doctor concluded otherwise. Instead of requesting a third opinion to break the tie, the employer demanded that she return to work. When Ms. Sicker was fired shortly after returning to work, she sued for FMLA interference. A Minnesota court agreed that her employer had interfered with her FMLA leave rights, explaining that since the FMLA requires a third opinion to be final and binding on the parties, the “only logical reading of the statute is that the second opinion is not.”

Employers must take note that they cannot use a second opinion to reject FMLA leave—they must request a tie breaker opinion. Also, they must pay for the second and third medical evaluations and medical providers conducting the employer’s assessment cannot be connected in any way to the employer. Be sure not to let your employees score a winning touchdown against your organization based on careless FMLA interference from management.

Compliance with the FLSA - There’s an App for That!

Ginny Webb — Thu, 16 Jun 2011 00:00:00 -0500

The U.S. Department of Labor (“DOL”) filed a lawsuit against the Texas Department of Family and Protective Services' Child Protective Services Division in Austin (“CPS”) for failing to pay 800 current and former investigators and case workers overtime compensation as required by the Fair Labor Standards Act (“FLSA”). The suit seeks back wages of more than $1 million, plus liquidated damages.

The complaint was filed in the U.S. District Court of the Western District of Texas, Austin Division. The DOL’s Wage and Hour Division conducted a three year investigation into CPS' practices statewide and determined that the employees were working "off the clock" rather than compensated for all hours worked. Additionally, the investigation revealed that supervisors were instructing employees not to record all of their hours worked and that CPS failed to maintain accurate and adequate records as required by § 211(c) of the FLSA. Finally, it was discovered that CPS willfully violated the FLSA by failing to pay employees for all hours worked over 40 in a week.
The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 for all hours worked, plus time and one-half their regular rates of pay, including commissions, bonuses and incentive pay, for hours worked beyond 40 per week.

Employers must also maintain accurate time and payroll records. Because of the serious penalties, an employer must take steps to ensure compliance with the FLSA and this sometimes calls for the assistance cooperation of its employees. The DOL recently launched an application for smartphones that is a timesheet to help employees independently track the hours they work and determine the wages they are owed. It is available in English and Spanish, and allows users to easily track regular work hours, break time and any overtime hours for one or more employers. This tool could be used by employees to comply with the FLSA rather than DOL enforcement. Employees could email their hours as part of employer recordkeeping and be asked to sign a weekly acknowledgement of all hours worked.

Employers Beware: New Smart Phone App Empowers Workers to Challenge Hours

Katie Anderson — Mon, 16 May 2011 00:00:00 -0500

Last week, the United States Department of Labor announced the launch of its first application for smart phones – a timesheet that employees can use to independently track the hours they work (including breaks and overtime) and to determine the wages they are owed. The app allows workers to record time manually or using the stopwatch feature. Employees can add comments regarding their work hours, view a summary of work hours (daily, weekly, and monthly formats), and email the summary as an Excel attachment.

The application is free and is available in English and Spanish. Currently, the app is compatible with the iPhone and iPod Touch. The DOL advises that it will explore updates that could allow similar versions for other smart phones such as the Android and Blackberry.
This creation comes from the Wage and Hour Division, whose mission statement explains its purpose is to “promote and achieve compliance with labor standards to protect and enhance the welfare of the Nation's workforce."

Labor Secretary Hilda Solis says:

I am pleased that my department is able to leverage increasingly popular and available technology to ensure that workers receive the wages to which they are entitled. This app will help empower workers to understand and stand up for their rights when employers have denied their hard-earned pay.

For workers without a smart phone, the Wage and Hour Division has a printable work hours calendar to track rate of pay, work start and stop times, and arrival and departure times. Both the app and the calendar can be downloaded from the Wage and Hour Division's home Web page at http://www.dol.gov/whd or
http://itunes.apple.com/us/app/dol-timesheet/id433638193?mt=8.
In light of this new technology, employers need to consider the following:

1. Employers must maintain accurate records. A review of an entity’s procedures for recording those records might suggest needed improvement to the current system to ensure accuracy.
2. Employers might want to take this opportunity to re-evaluate which employees are exempt, especially if detailed time records are not regularly kept for such employees.
3. Employers could require non-exempt employees to sign off on company time sheets to confirm agreement with the hours worked. While not conclusive, this admission by an employee could help refute conflicting time records the employee has kept independently. Additionally, at least under our current rules of evidence, signed time sheets are more readily admissible than smart phone app entries.
4. Caution employees that they cannot falsify time records and can be subject to discipline, up to and including termination, for intentionally falsifying timesheets.
5. Create a grievance process for employees to quickly raise complaints they have about allegedly inaccurate payment for hours worked.
6. Remind all supervisors that employees must not face any retaliatory action for recording their own time or for challenging the company’s calculation of time.

In the future, additional features may be added to the app or may be available on other applications, such as calculation of commissions and bonuses or tracking paid leave days and comp time. Perhaps employers will want to fund research to enhance the current application with polygraph technology to ensure workers are truthfully recording their time! In the meantime, employers beware and take steps to ensure your company’s time records are accurate.

A New Breeding Ground for FLSA Collection Actions – Mortgage Loan Officers Are Reclassified

Kimberly S. Moore — Fri, 08 Apr 2011 00:00:00 -0500

The Department of Labor (“DOL”) departed from a 2006 opinion letter finding loan officers, mortgage brokers, mortgage bankers and loan originators exempt under the Fair Labor Standards Act’s administrative exemption. For at least the last six years the industry has believed, based on good authority, these mortgage professionals could properly be paid a salary without the necessity for overtime compensation. As a result, most loan officers are paid annually with the opportunity for healthy commissions.
On March 24, the DOL determined that the administrative exemption does not apply to these mortgage professionals. Generally, the administrative exemption requires that:

(1)        An employee must be paid on a salary basis of at least $455/week ($23,600).

(2)        The employee’s primary duty must be the performance of office or non-manual work directly related to the management of general business operations of the employer or the employer’s customers; and

(3)        The employee’s primary duty includes the exercise of discretion and independent judgment with respect to matters of significance.

The second requirement, management or general business operations of the employer or employer’s customers, is the portion the DOL found problematic. Mortgage loan officers generally make loans to individuals and do not participate in running the actual business. Further, because these professionals are primarily commissioned, they are more like sales people. Therefore, because mortgage loan officers are selling mortgage loan products and not servicing the business by providing advice regarding internal operations, such as accounting or human resources, the DOL determined that the position does not qualify for the exemption.

Given the complicated salary and commission structure of these mortgage professionals along with the likelihood of overtime hours, there is high potential for many disputes.

The Supremes Hear The “Wal-Mart Wage Blues”

Francine W. Breckenridge — Thu, 31 Mar 2011 00:00:00 -0500

On March 29, 2011, an extremely important case was presented to the United States Supreme Court involving a massive class action of approximately 1.5 million past and present Wal-Mart female employees. Not only is this case the nation’s biggest employment discrimination case ever, but the issues at hand may have huge repercussions on class action lawsuits. Class actions allow huge numbers of plaintiffs to combine their claims against a single defendant and are extremely expensive for companies to defend.

Almost 10 years ago, Dukes v. Wal-Mart Stores, Inc. was filed in San Francisco by six women. Lower California courts certified it as a class action on behalf of female employees who worked at Wal-Mart’s retail stores and Sam’s Club Warehouses since December 1998. The Plaintiffs allege that the company has a pattern and practice of discrimination against women as evidenced by refusing or denying promotions to females in favor of less qualified men. As the nation’s largest private employer, Wal-Mart argues that it has an anti-discrimination policy in place and that the company should not be blamed for any purported “lapses” by managers of its 3,400 stores. The issue that reached the Supreme Court, however, is not the still-unresolved claim of discrimination, but the status of the suit as a class action. The Court will decide if it is fair for the women to pursue their claims together or if they will need to go forward individually.

Civil rights advocates, as well as labor unions, filed briefs arguing to the Supreme Court that dissolving the class action, requiring the women to sue individually, would insulate large companies by preventing employees from joining forces to challenge corporate practices. Conversely, business groups argue that allowing class action suits, based largely on statistics implying discrimination, will unleash a floodgate of similar cases with questionable claims, forcing businesses to settle since settlement is cheaper than litigating the class action.

Lower courts certified the class action, ruling that the Wal-Mart plaintiffs offered enough evidence that sex discrimination was a company-wide practice. These courts cited to studies showing that women were paid less across the country and made up two-thirds of Wal-Mart employees, but only one-third of Wal-Mart managers. The lower courts held that there was support for the plaintiffs’ allegations that local managers did not employ a standard format for pay and promotional decisions, and that Wal-Mart’s corporate culture fostered discrimination.

Several conservative justices on the Supreme Court grilled the plaintiffs’ attorney about the rationale for holding the retail giant accountable for store-level decisions. Justice Anthony Kennedy, who incidentally often casts the deciding vote in close cases, suggested that the women’s claims seemed contradictory. Kennedy maintained that the plaintiffs contended, on one hand, that Wal-Mart was infused with sex bias, but on the other hand provided no standards to store managers to make personnel decisions. During the one hour argument, Kennedy opined “it seems to me that there is an inconsistency there, and I am just not sure what the unlawful policy is.” Kennedy also questioned how the plaintiffs could argue that the company’s headquarters had knowledge while also claiming that the managers had too much discretion. Justice Anthony Scalia echoed that he, too, felt “whipsawed” by the plaintiffs’ case.

The plaintiffs’ attorney retorted that the local managers did not make the promotional and pay decisions in a vacuum. He claims that through staff training and word of mouth the managers are directed by the company as to how to exercise “discretion.” He also replied that the only “inconsistency” within the Wal-Mart system was between Wal-Mart’s alleged policy of non-discrimination and its contrary practice of paying women less than men and promoting them less often. While the Court’s liberal members seemed more receptive, with Justice Elena Kagen noting that the plaintiffs alleged a company-wide policy of “complete subjectivity…that allowed gender discrimination to come into all employment decisions”, it appeared that the majority of the Court did not buy the plaintiffs’ class action argument.

The decision in this case is expected some time in June 2011. All businesses need to pay particular attention to the outcome of this case as the implications could be far reaching, not only with respect to class actions, but also to imputed corporate knowledge of a company’s anti-discrimination practices and policies.

Oh, You Filed for Bankruptcy? So Sorry, But We Are Not Hiring You!

Martin Thornthwaite — Tue, 22 Mar 2011 00:00:00 -0500

On March 4, 2011, the Fifth Circuit confirmed that private employers may refuse to hire an applicant based on the applicant’s prior bankruptcy filing.[1] Specifically, the Fifth Circuit held that 11 U.S.C. § 525(b) “does not prohibit private employers from denying employment to applicants based on their bankruptcy status.”[2]
Shani Burnett (“Burnett”) filed suit against Stewart Title, Inc. (“Stewart Title”) alleging that Stewart Title violated 11 U.S.C. § 525(b) when it refused to hire her because she had previously filed for bankruptcy. In September 2006, Burnett filed for Chapter 13 bankruptcy. Later, in July 2007, Burnett applied for an employment position with Stewart Title and received an employment offer contingent upon the results of a drug test and background check. Upon review of the background check, Stewart Title learned that Burnett had filed for bankruptcy and rescinded its offer to her on that basis.

In her lawsuit, Burnett claimed that Stewart Title had unlawfully discriminated against her due to her bankruptcy status. The single issue for the Fifth Circuit to consider was whether a private employer can discriminate against a job applicant by denying employment based solely on that person’s status as a debtor in a bankruptcy proceeding.[3] The applicable statute, 11 U.S.C. § 525, provides different standards for government employers and private employers.

While § 525(a) states that a “governmental unit” may not “deny employment to … a person … solely because [the person] is or has been a debtor under this title or a bankrupt or debtor under the Bankruptcy Act …,” the section applicable to private employers is different and does not contain the “deny employment” language.[4] Rather, § 525(b) explains that no private employer may “discriminate with respect to employment against … an individual who is or has been a debtor … or bankrupt under the Bankruptcy Act ….”[5] Burnett argued her employment denial violated the plain language of § 525(b) because Stewart Title “discriminate[d] [against her] with respect to employment.”[6]

The Fifth Circuit rejected Burnett’s argument and explained that the statute must be read as a whole and § 525(a) specifically prohibits denial of employment while § 525(b) does not. The Court reasoned that Congress’s exclusion of the words “deny employment to” from subsection (b) “was intentional and purposeful,” and thus, the “discriminate with respect to employment” language in subsection (b) does not include denial of employment to a job applicant.[7] The Court concluded that Congress “intentionally and purposefully drew a line prohibiting governmental units, but not private employers, from denying employment to persons based on their status as debtors in bankruptcy proceedings” and affirmed the bankruptcy and district courts’ decisions that Burnett had failed to state a claim upon which relief could be granted.[8]

[1] Burnett v. Stewart Title, Inc., 2011 U.S. App. LEXIS 4369, *1 (5th Cir. 2011).
[2] Id. at *9.
[3] Id. at *3.
[4] Id.; 11 U.S.C. § 525(a), (b).
[5] Id. at *4 (quoting 11 U.S.C. § 525(b)).
[6] Id.
[7] Id. at *5-*6.
[8] Id.at *9.

The Supreme Court Upholds the “Cat’s Paw” Theory of Liability in Anti-Military Discrimination Case

Ginny Webb — Tue, 22 Mar 2011 00:00:00 -0500

On March 1, 2011, the United States Supreme Court held that if a supervisor performs an act motivated by antimilitary prejudice with the intention of causing an adverse employment action, the employer can be liable under Uniformed Services Employment and Reemployment Rights Act of 1994 (“USERRA”), 38 U.S.C. § 4301 et seq. In Staub v. Proctor Hospital, 2011 U.S. LEXIS 1900 (2011), the Court held that Proctor Hospital was liable for the antimilitary discriminatory acts of two supervisors because they intended to cause an adverse employment action against the Plaintiff by submitting an unfavorable report to the human resources department. The Supreme Court reversed the Seventh Circuit’s decision in a unanimous opinion with Justice Scalia writing the decision and Justice Alito writing the concurring opinion.

An army reservist, Staub, was employed by Proctor Hospital. Staub’s direct supervisor, Mullaly, and her direct supervisor, Korenchuck, were openly hostile to his military obligations. His direct supervisor placed him on corrective action for misconduct; and several weeks later, Korenchuck reported to the vice president of human resources that Staub had violated the corrective action plan. Staub denied the accusation, but the vice president relied on the supervisor’s allegation and a review of Staub’s personnel file in terminating his employment. Staub challenged his termination through Proctor’s grievance process alleging that the corrective action was initiated not because of any misconduct, but because of his direct supervisor’s hostility toward his military obligations. The vice president did not consult his direct supervisor about this allegation and upheld her termination decision. Staub sued Proctor claiming his termination was motivated by discrimination against his obligations as a military reservist. The trial court ruled in favor of Staub, but the Seventh Circuit Court of Appeals reversed, holding that Proctor was not liable as a matter of law because the ultimate decision maker had relied on more than just the guidance of the two supervisors in making her decision.

The Supreme Court reversed the Seventh Circuit and upheld Staub’s cat’s paw theory of liability. Justice Scalia stated, “Animus and responsibility for the adverse action can both be attributed to the earlier agent … if the adverse action is the intended consequence of that agent’s discriminatory conduct.” The Supreme Court looked to theories of general tort and agency law in reaching its conclusion that the supervisors’ discriminatory acts, including writing a corrective action report and reporting that Staub violated the correction action, was enough to hold Proctor liable for discrimination under USERRA because of the supervisors’ roles as agents of Proctor. The Supreme Court was not persuaded by Proctor’s argument that an independent investigation had been conducted by the ultimate decision maker, consequently relieving Proctor of USERRA liability. To the contrary, the Supreme Court found that Proctor was “at fault because one of its agents committed an action based on discriminatory animus that was intended to cause, and did in fact cause, an adverse employment decision.” In this case, despite the independent investigation of the human resources department, Staub’s supervisors’ history of hostility towards Staub’s military obligations convinced the Court that their actions were intended to cause an adverse employment action to be taken by the ultimate decision maker, thus, Proctor was liable under the USERRA.

The Supreme Court noted that the analysis did not apply to an allegation that a co-worker, rather than a supervisor, influenced the ultimate decision maker with his or her discriminatory motives.

Macy and Lilly are fighting--why won't the Supremes settle it?

Katie Anderson — Fri, 04 Mar 2011 00:00:00 -0500

On February 22, 2011, the United States Supreme Court denied cert, refusing to clarify the timing of how far back an employee can go when claiming pay discrimination.

Janice Gilmore claimed that Macy’s racially discriminated against her by refusing to let her fill in for absent employees, thus depriving her of opportunities to earn bonuses on additional sales. Since the claim involved compensation, the New Jersey Court applied the Lilly Ledbetter Fair Pay Restoration Act of 2009 and allowed Ms. Gilmore to pursue a Title VII pay discrimination claim based on alleged discriminatory paychecks issued as early as July 7, 2003, two years before she filed her EEOC charge.

The Lilly Ledbetter Legacy

Everyone recalls the Lilly Ledbetter Legacy from a few years ago. First, the U.S. Supreme Court issued its Ledbetter v. Goodyear Tire & Rubber Co. decision which held that a pay-setting decision, like a termination or demotion, is “a discrete act” forming the basis of a Title VII claim and must be filed within the 180-day period to bring a charge. The Court denied that each issuance of a paycheck was a continuing violation.

In response, the first piece of legislation President Barack Obama enacted was the “Lilly Ledbetter Fair Pay Restoration Act of 2009,” a law that flatly rejected the Title VII, the ADA, the ADEA and the Rehabilitation Act of 1973 to provide that the charge-filing periods commence when: decision.

The Act amends Title
(1) a discriminatory compensation decision or other practice is adopted;
(2) an individual becomes subject to the decision or practice; or
(3) an individual is affected by an application of a discriminatory compensation decision or practice.

Thus, the statute of limitations restarts each time an employee receives a paycheck based on a discriminatory compensation decision. The law retroactively applies to all pay discrimination claims pending on or after May 28, 2007 (one day before the Ledbetter
decision).

What does this mean for employers right now?

Because the Supreme Court refused to take the case and give any further guidance, this precedent from New Jersey gives the best guidance currently available on how far back a claim can go. Employers will need to preserve records and conduct discovery not only in or around the time an employee files a Charge of Discrimination with the EEOC but going back two years before that date.

With a Little Help From My Friends: The Supreme Court Expands Title VII Protection for Employees

Monica Velazquez — Fri, 25 Feb 2011 00:00:00 -0500

Most of us get by with a little help from our friends, but at work, that may now mean increased protection under Title VII. On January 24, 2011, the United States Supreme Court held that third-party or associational retaliation claims may be brought under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq. In Thompson v. North American Stainless LP, 131 S. Ct. 863; 178 L. Ed. 2d 694 (2011), the Court unanimously held that a man who was terminated after his fiancée filed a charge with the EEOC could sue for retaliation under Title VII. The Supreme Court reversed the Sixth Circuit’s decision in an 8-0 opinion with Justice Scalia writing the decision.

In 2003, Mr. Thompson had been terminated only a few weeks after his fiancée filed her EEOC charge for gender discrimination against the company in which they both worked. Mr. Thompson sued the company, claiming it retaliated against him for his fiancée’s protected activity. The trial court ruled in favor of the company, and the Sixth Circuit Court of Appeals agreed, holding that Mr. Thompson could not sue under Title VII because he did not engage in protected activity.

The Supreme Court reached the opposite conclusion. According to the Supreme Court, “Title VII’s anti-retaliation provision prohibits any employer action that ‘well might have dissuaded a reasonable worker from making or supporting a charge of discrimination.’” The Supreme Court reasoned that it was “obvious that a reasonable worker might be dissuaded from engaging in protected activity” if he/she knew that his/her fiancé would be fired. Further applying this reasoning, Mr. Thompson fell within the “zone of interests” protected by Title VII, since the law is supposed to protect employees from unlawful employment actions. In this case, Mr. Thompson was not an “accidental victim” of retaliation. Instead, the Supreme Court believed that the facts as alleged showed that injuring him was his employer’s intended means of specifically harming his fiancée.

The Supreme Court did not expound on which associational relationships (friends, church members, fishing buddies) were protected by Title VII’s anti-retaliation provisions. However, the Court did explain that firing an employee’s close family member as a means of retaliation would most likely be unlawful.

One of the significant aspects of this decision is that it indicates the Supreme Court’s continuing expansive view of whom and what is protected by Title VII. Now, employers not only have to be mindful of the claims a terminated employee may bring, but also the potential claims that the friends and family members, who also work for the same company, may bring against them. Those friends and family members will undoubtedly claim they were intended victims if they are subsequently disciplined or terminated. In the words of the song, now more than ever for employers, “it could be anybody” who files suit against you.

Drugs, Sex, Rock & Roll...and...Overtime?

Jana Woelfel — Fri, 11 Feb 2011 00:00:00 -0500

Metallica's drummer, Lars Ulrich, has been sued for failing to pay overtime to his personal assistant. Steve Wig claims Mr. Ulrich improperly paid him from 2001 to 2009. Mr. Ulrich's attorney has responded, "Steve got bonuses in every other year of his employment, deserved or not. Specifically, in 2008, he received an extra $18,000. So, it's not clear what's motivating this, but it really doesn't seem to be about his compensation, does it?"

Um, actually, Mr.Paterno, it is ALL about his compensation. FLSA claims concern whether the employee was paid legally under the FLSA, not whether the employee was paid "deservedly." In the words of a Metallica song penned by Mr. Ulrich, "Sad, but True."

The FLSA requires employees be paid overtime for all hours worked in a 7-day workweek in excess of 40 hours, unless they meet an "exemption." Exemption tests focus on what the employee actually does for the employer, and care nothing about whether the parties agreed to specific pay arrangement. In the words of yet another Metallica tune by Mr. Ulrich, "Nothing Else Matters."

Misclassification of a nonexempt employee as exempt is the most frequent violation of wage and hour laws and can trigger DOL audits and lawsuits by current and/or former employees, neither of which bode well for the employer. The issue is straightforward - either the employee is properly classified as exempt or he is not and there are no substantive defenses to an FLSA claim. Aside from the FLSA's language, a host of regulations, DOL opinion letters, and case law interpret a wide range of jobs and job responsibilities as exempt or nonexempt. Courts tend to narrowly construe the exemptions against the employer in an effort to support the fundamental purposes of the FLSA. If a court determines that the employee was nonexempt, he is entitled to payment of his unpaid overtime, plus that amount again as a penalty, plus payment of his attorneys' fees. Plus, one FLSA suit often spawns more. Thus, while it seems unlikely Mr. Ulrich had more than one personal assistant, more typical employers who have many employees performing the same position who are paid on the same basis, often find themselves facing multiple claims. And so it goes, in the words of another Metallica song, "All Nightmare Long."

ANOTHER REQUIRED NOTICE TO EMPLOYEES – WHEN WILL IT END???

Francine W. Breckenridge — Wed, 12 Jan 2011 00:00:00 -0500

Last week’s blog highlighted the resurgence of the NLRB and its recent efforts to re-enter the workforce, including a proposed rule requiring all employers to advise employees of their rights under the NLRA. Since the NLRA applies to most private sector employees (except employees of airline, railroad, and other agricultural workers), all employers, both union and non-union, should take note of this proposal and its possible ramifications.

Under the proposed rule, all private sector employers under the ambit of the NLRA will be required to post the “Employee Rights Notice” where other workplace notices are typically posted. If an employer communicates with employees primarily by e-mail or other electronic means, the notice would also need to be posted electronically. This rule is similar to one recently finalized by the U.S. Department of Labor for federal contractors. Federal contracts must post a notice stating that employees have the right to act together to improve wages and working conditions; to form, join, and assist the union; to bargain collectively with their employer; and to choose not to do any of these activities. The notice also provides examples of unlawful employer and union conduct and tells employees how to contact the NLRB with any questions or complaints.

Clearly, this proposed rule can impact on non-union employers, especially if unions are targeting a particular industry. While these notices are similar to notices under Safety, Wage, and Anti-Discrimination laws, the proposed NLRA notice could bolster union membership, especially in the immediate month after the rule is implemented. Further comments are invited on the proposed rule, but need to be submitted no later than February 20, 2011. The comments can be submitted electronically to www.regulations.gov. Employers who are currently non-union should voice their opinion on the proposed rule before it is too late. If your company has any further questions on union activity at your workplace, do not hesitate to contact any of the Strasburger Labor & Employment attorneys.

The NLRB cometh …

Tiffany G. Hildreth — Thu, 06 Jan 2011 00:00:00 -0500

By mid-June of 2010, the NLRB was arguably hobbling off to near irrelevance. The Employee Free Choice Act hadn’t been mentioned in months. The United States Supreme Court’s New Process Steel decision had just voided hundreds of cases decided during the two years when the NLRB had only two members. The country seemed unconcerned about a labor rights board when there didn’t seem to be enough jobs to merit concern about labor rights.
What a difference six months can bring.
By June 22, 2010, the NLRB attained its fifth member. Revived by its first full panel in years, it began morphing from a dormant relic into a full-throttle agency, eager to wield the often-overlooked provisions of the NLRA.
By early November 2010, the NLRB issued the complaint against American Medical Response of Connecticut for terminating an employee who had criticized her supervisor online. The NLRB charges that the employee was engaging in protected "concerted activities with other employees." On Dec. 22, 2010, it issued a proposed rule that would require all employers covered by the NLRA, even if non-unionized, to post notices advising employees of their NLRA rights or face sanctions. The NLRA posits this rule as necessary because many employees protected by the NLRA are unaware of their rights since no present law requires communication of such rights and most private employees lack union representation.

Call it one of any of the usual clichés – the tide had turned, the pendulum has swung, the dead has arisen, etc. The point is simple – employers need dust off their copy of the NLRA because the NLRB may be knocking at the door, and knocking loudly, very soon.

Competitive Cheerleading isn’t a “Sport” for Title IX Purposes… Yet

Katie Anderson — Tue, 07 Dec 2010 00:00:00 -0500

Our team is red hot, Our team is red hot, Our team is red hot,
Our team is r-e-d “RED” h-o-t “HOT” once we start, we can't be stopped!

If that was your last memory of cheerleading, you might be surprised to learn that competitive cheerleading has grown so much in recent years   that some schools now count it as a “sport” under Title IX. However, a Connecticut district court recently ruled that competitive cheer was not Title IX worthy.

Enacted nearly forty years ago, Title IX mandates equal opportunities for males and females in athletics for any schools that receive any federal funds. The 2008 Office of Civil Rights Guidance lists factors for evaluating whether an activity is a Title IX sport:

    Whether operating budget, support services and coaching staff are administered by the athletic department or another entity;
    The organization of team preparation and competitions, i.e. whether there is a defined season and a specific set of rules of play adopted by a governing organization;

Whether the primary purpose of the activity is to provide athletic competition rather than to support or promote other athletic activities.

The court focused on the fact that the cheerleading squad was designed to support other groups and not originally created for authentic athletic competition.   Under this analysis, however, cheerleading squads that are formed only to compete and do not cheer at games for other sports might just fit the definition of sports.

At a minimum, we are likely to see different schools arguing that different athletic activities are “sports” under Title IX. While civil rights groups have and will likely continue to challenge these arguments, some of them will likely hold up over time as athletic opportunities for females take new and interesting shape. We are available to assist your school with a legal analysis for Title IX and whether a sport might qualify. We will help you – Go-Fight-Win!!

Search the Internet for “competitive cheerleading,” and you will be bombarded with information on cheer academies and cheer competitions. For instance, www.varsity.com advises: “The USA Federation for Sport Cheerleading would like to announce the selection of the National team to represent the United States of America in the 2011 International Cheer Union World Championship April 28-29, 2011. There were over 80 countries represented at the 2010 World Cup.”   Yes, there is a cheerleading World Cup.

Biediger v. Quinnipiac University, __ F. Supp. 2d __, 2010 WL 2977043 (D. Conn. 2010)(holding that Quinnipiac must keep it's women's volleyball team in order to comply with Title IX and could not replace the volleyball team with competitive cheerleading).

No person in the United States shall, on the basis of sex, be excluded from participation in, be denied the benefits of, or be subject to discrimination under any education program or activity receiving Federal financial assistance. 20 U.S.C. § 1681(a).

The court noted that “[c]ompetitive cheer may, some time in the future, qualify as a sport under Title IX. Today, however, the activity is still too underdeveloped and disorganized to be treated as offering genuine varsity athletic participation opportunities for students."

National Labor Relations Board Takes Aim at Employer’s Social Media Policy

Martin Thornthwaite — Wed, 10 Nov 2010 00:00:00 -0500

On October 27, 2010, the National Labor Relations Board (NLRB) issued a Complaint and Notice of Hearing against American Medical Response of Connecticut, Inc. (“Employer”) in response to a charge filed by the International Brotherhood of Teamsters, Local 443, (“Union”) on behalf of a former employee of Employer. The hearing is set for January 25, 2011, and the decision could have far reaching effects on both union and nonunion employers. If the NLRB prevails, employers will need to reexamine their social media policies to ensure they are not overly broad in order to avoid possible NLRB action.
On November 8, 2009, the employee had asked Employer to allow the Union to represent her during an investigatory review which she believed would result in disciplinary action against her. After the employee’s supervisors allegedly threatened her with discipline because of her request for Union representation, she criticized one of her supervisors on her Facebook page. In response to the employee’s Facebook posting, some of her coworkers also criticized the supervisor and offered support for the employee. On December 1, 2009, Employer terminated the employee because she violated company policy by criticizing her supervisor on Facebook.

The NLRB claims the employee’s Facebook posting was protected concerted activity with other employees and that Employer’s social media policy violated the National Labor Relations Act (the “Act”). The Act is designed to protect the rights of workers in both union and nonunion settings by safeguarding discussions about wages, hours, and other terms and conditions of employment, including attempts by employees to improve their work situation. Policies and procedures that “reasonably tend to chill” employees’ rights under the Act will violate the Act.

Employer’s social media policy states in pertinent part: “Employees are prohibited from making disparaging, discriminatory or defamatory comments when discussing the Company or the employee’s superiors, co-workers and/or competitors.” The NLRB claims this provision is overly broad and prohibits communications protected by the Act, thereby “interfer[ing] with employees in the exercise of their right to engage in protected concerted activity.”

INTRODUCING THE BIGGER, BETTER-FUNDED EEOC

Francine W. Breckenridge — Fri, 08 Oct 2010 00:00:00 -0500

The traditionally overworked, underfunded EEOC may be a thing of the past. Although the EEOC projects the number of discrimination charges will exceed 100,000 for the first time, by the end of 2010, it appears the EEOC may be geared up to handle the load. The Obama Administration has indicated its intent to pursue a pro-employee agenda. In support of this goal, the EEOC received major increases in its budget and staff in 2010.

Jacqueline A. Berrien was sworn in as the new chair of the EEOC on April 7, 2010. Ms. Berrien is the former Associate Director Counsel of the NAACP Legal Defense and Education Fund. On the same date, the first open lesbian to serve as a commissioner, Chai Fieldblum, was also sworn into the agency. The former Assistant Secretary of Labor and the only Republican, Victoria Lipnic, was sworn in as Commissioner on April 20, 2010. These three individuals will serve until the end of the 2011 Congressional Session, unless confirmed by the Senate for full terms. These appointments give the EEOC Commission a full-slate of five commissioners.

President Obama requested an additional $18 million in the EEOC’s 2011 budget. The majority of the funds are to be used for more than 150 new investigators to help process charges of discrimination filed in 2010. With this increased funding and personnel, the EEOC may also file more lawsuits on its own. Such new lawsuits could involve the recently-expanded scope of the ADA and pay discrimination statutes. The amendments to the Americans with Disabilities Act (ADAA) provide a “broad scope of protection” to the disabled., which include an expanded definition of “major life activity,” the easing of the Plaintiff’s burden to meet the “regarded as disabled” standard and the virtual elimination of “mitigating measures.” The Lily Ledbetter Fair Pay Act of 2009 (FPA) allows employees to file discrimination charges within 300 days of the last paycheck paid pursuant to discriminatory compensation decision. This means the EEOC’s investigation of purported discriminatory pay decisions that occurred many years in the past extends the information available to the EEOC in its search to target “systematic discriminators.” It would not be surprising if the EEOC identifies and litigates pay discrimination cases involving large classes of employees.

WHEN (NOT “IF”) THE EEOC CALLS, WHAT SHOULD YOU HAVE ALREADY DONE AND BE PREPARED TO DO?

As mentioned a few days ago, with more people, money and regulations in hand, the Equal Opportunity Employment Commission (“EEOC”) is escalating its investigation and enforcement efforts. So what should your business do to prepare just in case the EEOC comes knocking at your door? What should your business do while the EEOC hangs around your workplace?

Since the Lily Ledbetter Fair Pay Act of 2009 (FPA) could expose an employer to liability for compensation-related discrimination decades before the discriminatory decision occurred, employers must self-audit past compensation decisions and potential pay disparities now. Employers should also reevaluate all their employment policies and practices to ensure compliance with all applicable regulations, laws, and amendments thereto. This is especially true with respect to the employers’ policies and practices pertaining to the ADAA. Finally, employers need to re-visit document retention guidelines and confirm that records are not being routinely eliminated by a policy put into place before the FPA was enacted.

During an investigation, employers need to treat the EEOC investigators as investigators – not adversaries. On one hand, this means that employers should be honest and cooperative. On the other, employers should also remember to answer only what is asked. Fully comply with the EEOC’s requests without providing unnecessary or extraneous information that could expose the employer to increased EEOC scrutiny.

It is also imperative to provide a professional and thorough response to the EEOC charge. Remember - if the case goes to trial, everything the employer submits to the EEOC is accessible to the plaintiff employee through a Freedom of Information Act request and mistakes in response could potentially hurt the employer’s position in trial. Consequently, a thoughtful and accurate presentation is crucial. Treat the response as if the employer were giving a deposition under oath.

The EEOC offers a mediation process as a good faith attempt to resolve the dispute. Employers should evaluate and strongly consider participating in a mediation process. Doing so could resolve the matter more quickly and inexpensively than a protracted litigation or investigation that uncovers other issues. Additionally, the mediation process can provide the employer with information to better assess potential liability.

WITH MONEY IN ITS POCKETS, THE EEOC IS READY TO ROLL

Francine W. Breckenridge — Fri, 08 Oct 2010 00:00:00 -0500

The Equal Opportunity Employment Commission’s (“EEOC”) increased budget this year is enabling the agency to increase on-site investigations, fact-finding conferences, and subpoenas to enforce requests for information from employers pertaining to discrimination charges. Jacqueline A. Berrien was sworn in as the new chair of the EEOC on April 7, 2010. Ms. Berrien is the former Associate Director Counsel of the NAACP Legal Defense and Education Fund. On the same date, the first open lesbian to serve as a commissioner, Chai Fieldblum, was also sworn into the agency. The former Assistant Secretary of Labor and the only Republican, Victoria Lipnic, was sworn in as Commissioner on April 20, 2010. These three individuals will serve until the end of the 2011 Congressional Session, unless confirmed by the Senate for full terms. These appointments give the EEOC Commission a full-slate of five commissioners.

Notably, the Obama Administration has indicated its intent to pursue a pro-employee agenda. Following through with this intent, the EEOC received major increases in its budget and staff in 2010. President Obama requested an additional $18 million in the EEOC’s 2011 budget. The majority of the funds are to be used for more than 150 new investigators to help process charges of discrimination filed in 2010. The EEOC projects the number of discrimination charges will exceed 100,000 for the first time, by the end of 2010. Based upon the EEOC’s increased enforcement, employers need to be prepared to handle and cooperate with EEOC investigations, while making sure that the EEOC remains neutral during its investigation phase.

The EEOC may also file more lawsuits on its own, especially in the areas of disability and pay discrimination. The amendments to the Americans with Disabilities Act (ADAA) provide a “broad scope of protection” to the disabled. The ADAA’s broad coverage, its expanded definition of “major life activity,” the easing of the Plaintiff’s burden to meet the “regarded as disabled” standard and the virtual elimination of “mitigating measures” signify that employers can expect a surge in disability charges filed with the EEOC.

The Lily Ledbetter Fair Pay Act of 2009 (FPA) allows employees to file discrimination charges within 300 days of the last paycheck paid pursuant to discriminatory compensation decision. This means the EEOC’s investigation of purported discriminatory pay decisions that occurred many years in the past extends the information available to the EEOC in its search to target “systematic discriminators.” It would not be surprising if the EEOC identifies and litigates pay discrimination cases involving large classes of employees.

So what should your business do to prepare just in case the EEOC comes knocking at your door? It is extremely important for employers to self-audit past compensation decisions and potential pay disparities. Employers should re-visit document retention guidelines as the FPA could expose an employer to liability for compensation-related discrimination decades before the discriminatory decision occurred. Employers should also reevaluate all their employment policies and practices to ensure compliance with all applicable regulations, laws, and amendments thereto. This is especially true with respect to the employers’ policies and practices pertaining to the ADAA.

If an investigation occurs, employers need to treat the EEOC investigators as investigators – not adversaries. The employer should be honest and cooperate, while attempting to narrow the EEOC’s broad requests for information. The employer should tailor their responses to fully comply with the EEOC’s requests, without providing unnecessary or extraneous information. Providing extraneous information could expose the employer to increased EEOC scrutiny. The EEOC also offers a mediation process as a good faith attempt to resolve the dispute. Employers should evaluate and strongly consider participating in a mediation process. Typically, participating in the mediation process provides the employer with information to better assess potential liability.

In responding to an EEOC request for information, it is imperative that an employer have accurate facts and dates pertaining to the statements in the discrimination charge. The EEOC’s response should be treated as if the employer were giving a deposition under oath. If the case is ultimately taken to court, mistakes in the EEOC response could potentially hurt the employer’s position. If the case goes to trial, everything the employer submits to the EEOC is accessible to the plaintiff if the plaintiff files a Freedom of Information Act request. The employer needs to strenuously defend its position in a professional and accurate manner, without letting bias against the complainant color the employer’s response.

Finally, employers are encouraged to call counsel to make sure that the employer is doing all it can do to protect its company during the EEOC investigative process. Strasburger & Price is here to assist your company if the EEOC comes rolling your way.

The EEOC Comes Out Swinging

Tiffany G. Hildreth — Tue, 14 Sep 2010 00:00:00 -0500

In a September 9th press release, the EEOC announced that it had filed three new cases “in its commitment to end disability discrimination in employment.” The import of these three cases is that, but for the ADA Amendments Act, they likely would not have been filed. Courts had previously held that the disabilities at issue – arthritis, diabetes, hypertension and cancer in treatement - lacked coverage under the ADA.

In EEOC v. Eckerd Corporation d/b/a Rite Aid, filed in U.S. District Court for the Northern District of Georgia, suit has been brought because the employer refused to provide a reasonable accommodation for an employee with arthritic knees. An employer improperly selected two employees for a reduction in force because of their diabetes and hypertension conditions, as alleged in EEOC v. Fisher, Collins & Carter, filed in the U.S. District Court for the District of Maryland. Finally, in EEOC v. IPC Print Services, Inc. (District Court for the Western District of Michigan), the EEOC claims that the employer violated its reasonable accommodation obligations. The employee went on medical leave in 2008 to undergo chemotherapy, but was discharged for exceeding the maximum hours of leave allowed under company policy after asking to work part-time while he completed his treatment.

The ADAA made it clear that the above conditions, as well as a multitude of others, would no longer be excluded from the ADA, notwithstanding a history of U.S. Supreme Court cases and lower court decisions that had specifically denied any coverage (e.g. - Orr v. Wal-Mart Stores, Inc., 297 F.3d 720 (8th Cir. 2002)(diabetes), Hill v. Kansas Area Transp. Auth., 181 F.3d 891 (8th Cir. 1999)(hypertension), EEOC v. R.J. Gallagher Co., 181 F.3d 645 (5th Cir. 1999)(cancer)). Employers would be wise to acknowledge that, under the ADAA, the issue will rarely involve whether the disability is covered, and will most often focus on the reasonable accommodation process and decision. Employers would also be wise to remember that the EEOC intends to make full use of its new arsenal, as noted in the press release: “We hope that these cases send a clear message that the Commission will vigorously enforce the ADA.”

Potential Overtime Pay Substantial for Pharmaceutical Sales Representatives

Kimberly S. Moore — Tue, 24 Aug 2010 00:00:00 -0500

Historically, under the Fair Labor Standards Act, an outside salesperson’s primary duty must be to (i) makes sales or (ii) obtain orders or contracts for services or for the use of services in exchange for money from a customer or client. The dilemma with pharmaceutical sales representatives is that they are prohibited from selling drugs to the consumers so they must instead attempt to convince a “middle man,” in this case a physician, to write the described prescription for the requested drug.

Recently, the Second Circuit decided in In re Novartis Wage and Hour Litigation; No. 09-0437-CV, 2010 Lexis 13708 (July 6, 2010) that pharmaceutical sales representatives could not qualify under either the outside sales exemption or the administrative exemption because they did not obtain orders from contracts, engage in direct sales or have sufficient discretion and independent judgment to qualify for the exemptions. The Second Circuit emphasized the distinction between promoting sales and making them. In its opinion there was tremendous deference to the Secretary of Labor’s position. Based on the ruling, Norvatis Pharmaceutical sales representatives would be entitled to overtime pay and given their six figure incomes the overtime rate is substantial.

I Was Fired Because my Honey Filed a Discrimination Claim

Francine W. Breckenridge — Tue, 06 Jul 2010 00:00:00 -0500

On June 28, 2010, the U.S. Supreme Court granted certiorari in Thompson v. North American Stainless, LP, to review whether Title VII provides a cause of action for third-party retaliation for individuals who did not themselves engage in a protected activity. Mr. Thompson’s engagement to a fellow employee was common knowledge in the company. In September 2002, Thompson’s fiancé filed a charge with the Equal Employment Opportunity Commission (EEOC) alleging that her supervisors discriminated against her based on her gender. The company learned about her discrimination charge on February 13, 2003. On March 7, 2003, the company fired Thompson, based on poor performance. In his subsequent lawsuit, Thompson claimed he was actually terminated in retaliation for his fiance’s EEOC charge.

The company’s summary judgment was granted by the trial court.A sharply divided Sixth Circuit affirmed (in a 10-6 decision), holding that Section 704(a) of Title VII did not create a cause of action for third-party retaliation for individuals who did not engage in a protected activity. Since Thompson did not allege he himself engaged in a statutorily protected activity (i.e., make a charge, testify, assist, oppose an unlawful employment practice, etc.), he was not included in the class of persons Title VII was designed to protect in retaliation claims. The Third, Fifth and Eighth Circuits agree with the Sixth Circuit, while the EEOC and the National Labor Relations Board disagree. “To retaliate against a man by hurting a member of his family is an ancient method of revenge, and is not unknown in the field of labor relations.” NLRB v. Advertisers Mfg. Co., 823 F.3d 1086, 1087 (7th Cir. 1987). The EEOC Compliance Manual states “the retaliation provisions of Title VII … prohibit retaliation against someone so closely related to or associated with the person exercising his or her statutory rights that it would discourage or prevent the person from pursuing those rights. For example, it would be unlawful for a respondent to retaliate against an employee because his or her spouse, who is also an employee, filed an EEOC charge.”

So what will the Supreme Court decide? According to the company’s brief opposing Thompson’s petition for certiorari, if the Sixth Circuit’s decision is reversed, it will “create an environment of chaos in both the courts and the workplace.” The company maintains that reversing the decision will create excessive side-bar litigation over what types of relationships should be entitled to protection will arise, requiring employers to speculate about possible relationships between employees each time they contemplate disciplinary action.

Since the Supreme Court granted certiorari they obviously believe the issue needs to be addressed. Which way they will rule is anyone’s guess, but if the Sixth Circuit decision is reversed, employers will need to be keenly aware of associations among all employees prior to taking any type of adverse job consequence against complaining employees.

Ten days, three big decisions.

Tiffany G. Hildreth — Wed, 23 Jun 2010 00:00:00 -0500

Sometimes, the hits just keep coming. In the past ten days, many would say that employees took a resounding beating at the hands of the U.S. and Texas Supreme Courts. Regardless of one’s personal views, these decisions certainly enlarge employers’ rights both before and during litigation.

June 11, 2010 - In Waffle House Inc. v. Cathie Williams, the Texas Supreme Court held that a plaintiff who brings a statutory sexual harassment claim and a common-law negligent supervision and retention claim can recover only the statutory remedy if both are based on the same facts. This is huge for employers facing multiple legal claims arising from a single set of facts not only by narrowing the focus of the legal strategy but also by reducing the potential damage model. Indeed, the Waffle House jury had awarded the plaintiff $425,000 in compensatory damages and $3.46 million in punitive damages, finding for her on both the statutory sexual harassment claim as well as the common-law negligent supervision and retention claims. Under the statutory claim, she would have received a maximum of $300,000 in compensatory and punitive damages.

June 17, 2010 - In City of Ontario v. Quon, the U.S. Supreme Court unanimously held that the City did not violate a police officer's Fourth Amendment rights by auditing text messages he received on City-issued equipment. Any Fourth Amendment expectation of privacy was not violated because the search was reasonable - it had a legitimate, work-related purpose and was not excessively intrusive since only work-related text messages were reviewed. The Court did caution that its decision should be limited given the constantly-changing nature of communications technology. Although technically a public employee case, this decision grants private employers greater confidence in auditing employee electronic communications without fear of privacy issues. It should be noted that the City’s policies did not specifically mention text messaging, but the courts acknowledged that the plaintiff had been verbally told that the policies covered text messages.

June 21, 2010 - In the 5-4 Rent-a-Center v. Jackson decision, the U.S. Supreme Court held that if a company’s arbitration agreement includes a provision assigning enforceability challenges to the arbitrator, a court must enforce that agreement and send the matter to arbitration, so long as the challenging party is objecting to the agreement in its entirety and not just that provision. The case arose out of an employment discrimination claim filed in federal court in which the employer filed a motion to compel arbitration based on the arbitration agreement the plaintiff signed as a condition of his employment. When the plaintiff countered that “the arbitration agreement in question is clearly unenforceable in that it is unconscionable,” the employer argued that this unconscionability claim was not properly before the court because the plaintiff had expressly agreed that the arbitrator would have exclusive authority to resolve any dispute about the enforceability of the agreement. Wise plaintiffs lawyers will more carefully craft their objections, but employer should still feel emboldened by this decision to aggressively pursue their arbitration rights.

Congress Attempts to Deter Misclassification with the Employee Misclassification Act

Kimberly S. Moore — Tue, 25 May 2010 00:00:00 -0500

The Employee Misclassification Act was recently introduced in an effort to deter employers from misclassifying workers as independent contractors instead of employees. According to its proponents, the Act is designed to insure that workers receive appropriate fair labor standards, health and safety, unemployment and workers’ compensation protections. The Act would amend the Fair Labor Standards Act to: (1) require employers to keep enhanced records regarding the classification of each worker; (2) penalties for misclassification would be enhanced; (3) employers would be required to notify employees of their status as an employee; and (4) the Act prohibits retaliation for classification challenges. The Act also enhances the likelihood of a targeted audit by the Department of Labor.

It’s Time for Employers to Review their Technology Use Policy

Katie Anderson — Wed, 21 Apr 2010 00:00:00 -0500

Is it time for an overhaul of technology use policies? Based on the recent Stengart v. Loving Care[1]decision from the New Jersey Supreme Court - “yes.”

Employee Stengart communicated with her lawyer on her company-issued laptop by accessing a personal, password-protected Yahoo email account. After she filed a lawsuit, Loving Care hired a forensic expert to create an image of the laptop’s hard drive, which allowed retrieval of the contents of some of the emails. Loving Care asserted that Stengart had no reasonable expectation of privacy in files on a company-owned computer in light of the company’s policy on electronic communications.

The New Jersey Supreme Court disagreed. It found that an objective reader could reasonably conclude that not all personal emails were company property based on the language of the company’s policy, which allowed for “occasional personal use.” The court balanced the employer’s right to enforce reasonable rules for the workplace against the policies underlying the attorney-client privilege, which the court states is a “venerable privilege… enshrined in history and practice.” The court further said that there must be a nexus between the email use policy and the employer’s legitimate business interests. In other words, to prohibit use of email for personal communications, the company must identify why such a policy is needed for the company’s business.

Notably, the court did not advocate a zero-tolerance policy in allowing personal use of work computers. The court even went so far as to say that even if an employer does adopt such a policy, the employer cannot read employee email. The only thing employers can do, according to the court, is punish an employee with discipline for failing to adhere to the policy.

Thus, employers can and should review their technology use policies and clarify what information is private and what information is not private and thus subject to review. Then, employers must consistently enforce the policy equally with respect to all employees. Finally, if employers want to ban use of work computers for all personal uses, they can attempt to lawfully do so, but only if they have a legitimate business interest for the complete ban. Even then, employers likely do not have a right to read the email that is prohibited, especially if it is protected by a privilege such as the attorney-client privilege.

[1] Stengart v. Loving Care Agency, Inc., 2010 N.J. LEXIS 241 (N.J. Mar. 30, 2010).

New $25 Million Blockbuster-- Coming Soon to an Employer Near You!!

Jana Woelfel — Mon, 19 Apr 2010 00:00:00 -0500

The Department of Labor (DOL) has been given funds and a clear directive from the President to step up employee misclassification enforcement efforts. U.S. Secretary of Labor, Hilda Soliz, has announced a new program to advise workers of their labor and employment rights. The program, called "We Can Help," was launched last week. The We Can Help website provides a toll-free hotline for an employee or contractor to raise questions or concerns about how she is being paid. The worker is promised confidentiality and undocumented workers are protected from immigration enforcement for complaints about wage violations. To aid its efforts in getting the word about the We Can Help program out to workers, the DOL has teamed with various employee advocacy groups, including the AFL-CIO and others to educate workers. Plans include distribution of literature, public wage-rights forums, and facilitation of meetings with Wage & Hour enforcement staff within the DOL.

The We Can Help program is the next step in the DOL's "Misclassification Initiative" which is designed to identify and take enforcement action against employers who have improperly classified workers as independent contractors instead of employees. In the recently approved 2011 federal budget, $25 million was set aside for the specific purpose of supporting the Misclassification Initiative, out of the $1.7 billion appropriated for the DOL as a whole. The DOL has reported it will allocate $12 million of the funds to improving the DOL's ability to conduct investigations and will hire 90 full time investigators to assist with these investigations within the DOL. These 90 new hires are in addition to the existing wage and hour investigative staff. The DOL has also reported that it will allocate $11.25 million and hire 2 new full time employees to assist the States in their worker misclassification enforcement efforts. Accordingly, Texas employers should expect to see more actions from both the DOL and the Texas Workforce Commission (TWC). Finally, the DOL has allocated $1.6 million and 10 new full time employees to pursue misclassification litigation against employers. If the DOL determines that a worker was improperly classified as a contractor rather than an employee, the DOL is focused on obtaining wages, overtime pay, unemployment insurance benefits, social security contributions, and health, welfare and pension benefits available to employees, but not independent contractors. If the employer fails to settle with the DOL at the audit stage, the employer does so at its risk as legislation has been proposed to bring contractor misclassification problems under the scope of the Fair Labor Standard Act (FLSA) which would not only permit workers who were misclassified to recover those wages and benefits, but also their attorneys' fees and expenses and an equal amount of the wages and benefits as liquidated damages. Additionally, and not insignificantly, the employer will be responsible for unpaid taxes and penalties.

The DOL's efforts will be supported by increased random audits of 6,000 employers being conducted by the Internal Revenue Service (IRS) to confirm that employers are classifying and withholding properly. This is in addition to the IRS' normal audit efforts usually triggered by a problem with a company's tax return. In our current economic crisis, it is perhaps easier to understand this initiative when one knows that the 2009 Government Accountability Office (GAO) report labeled misclassification as a "significant problem" and estimated that it would cost $7 billion in lost payroll taxes to the federal government over the next 10 years. In that light, the monies budgeted toward enforcement begin to make sense. Employers should not expect to get "cut much slack" simply because industries "have always classified certain workers as contractors." Instead, such an excuse is likely to be taken as an invitation to audit a company's competitors.

Employers should expect a surge in enforcement actions. Prudent employers will anticipate the initiative and speak with experienced employment counsel who can assist the employer in confirming the proper classification of its workers as contractor versus employee, confirming the exempt status of the employee and associated wages and benefits. The IRS has issued Publication 1779 briefly describing the factors in classifying a worker as an employee or independent contract. It can be found at http://www.irs.gov/pub/irs-pdf/p1779.pdf. It is a good starting point, but an employer with significant contractors in its workforce are well advised to seek the advice of counsel well versed in wage and hour compliance as the statutes, regulations and case law have nuances which cannot be covered in a one page summary.

Getting Even With Your Employer Could Land You In Jail

Francine W. Breckenridge — Wed, 17 Feb 2010 00:00:00 -0500

So you’ve been let go by your employer – of course, unfairly – and you decide not to get mad, but get even. You come up with the brilliant idea of placing a help-wanted ad on Craigslist. After all, advertising on Craigslist doesn’t cost a dime. You draft an ad stating that your former employer is hiring up to 500 new employees with starting pay at $25 an hour plus benefits. You then list your former employer’s name and number and instruct potential applicants to call immediately to set up an interview time. You chuckle as you place the ad on Craigslist knowing full well that your former employer, who currently only employs 33 people, will be inundated with these calls bringing productivity to a stand still. Have you’ve gotten even? Perhaps, but you’ve also committed a third degree felony.

On September 1, 2009, a new section of the Texas Penal Code, Section 33.07, was implemented entitled, “Online – Harassment.” The online harassment law makes it a crime to: “use the name or persona of another to create a webpage on or to place one or more messages on a commercial social networking site: (1) without obtaining the other person’s consent; and (2) with the intent to harm, defraud, intimidate, or threaten any person. A person commits an offense if the person sends an electronic mail, instant message, text message, or similar communication that references a name, domain address, phone number, or other item of identifying information belonging to any person: (1) without obtaining the other person’s consent; (2) with the intent to cause a recipient of the communication to reasonably believe that the other person authorized or transmitted the communication….”

In fact, a 33-year old Houston woman (let’s call her Reva Inge) was charged with violating this law after the police conducted an investigation into the placement of an unauthorized ad. Just as in the example above, the ad listed employment opportunities with Reva Inge’s former employer. The employer informed the police that he had not authorized a help-wanted ad and that he was being plagued with calls regarding the job listed in the ad. At the conclusion of their investigation, the Galveston County District Attorney charged Ms. Inge with a third degree felony and she turned herself in to the Galveston County Sheriff on February 8, 2010. Charges are still pending, but she was released from jail after posting a $5,000 bond.

So the moral to this story is, if you plan to get even with a former employer because you believe you were wrongfully terminated, make sure whatever you do doesn’t break the law!

COBRA Subsidy Extended

Katie Anderson — Tue, 22 Dec 2009 00:00:00 -0500

Without an extension, employees laid off starting Jan. 1, 2010, would have been ineligible for the subsidy, as would current beneficiaries who have hit the nine-month limit.

Last week, President Obama gave a speech at the Brookings Institution in Washington, urging the COBRA subsidy for laid-off employees as one of several economic relief provisions that lawmakers should extend. "The administration will be working with Congress to ensure that those hit hardest by this economic crisis continue to receive the support they need....This includes the Recovery Act provision that helps out-of-work Americans keep their health insurance through COBRA," President Obama said.

The President is now expected to sign an extension of the COBRA premium subsidy passed by the Senate 88-10 this past Saturday. The measure if part of a military spending bill that the House passed earlier last week and includes a provision that extends the nine-month, 65% premium federal subsidy by an additional six months. The change applies to those who are involuntarily terminated through February 28, 2010 (previously December 31, 2009). The legislation also provides another six months of subsidized coverage for beneficiaries whose nine-month COBRA premium subsidy has run out. The extensions can be found in Section 1010 of the Department of Defense Appropriations Act, available at http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=111_cong_bills&docid=f:h3326enr.txt.pdf.

Will OSHA Be Knocking On Your Door Soon?

Francine W. Breckenridge — Fri, 04 Dec 2009 00:00:00 -0500

Now that the campaign rhetoric has died down and the first 100 days are behind us, campaign promises made by President Obama are coming to fruition. President Obama is a strong advocate of the enforcement arm of the Occupational Safety and Health Administration (“OSHA”) becoming stronger and more proactive. OSHA is becoming more proactive and on October 1, 2009, through its National Emphasis Program (“NEP”) on Injury And Illness Reporting, OSHA began to target nursing homes and personal care facilities to ensure that OSHA’s record keeping requirements are closely followed. OSHA views nursing homes and personal care facilities as “high risk injury” industries. As such, other “high risk injury” industries such as construction companies, food manufacturers, and the like may want to pay particular attention to OSHA’s current aggressiveness towards nursing home and personal care facilities.

OSHA announced that it plans to inspect 1,000 nursing home and personal care facilities before October 2010. The OSHA audits will focus on nursing home/personal care facilities with at least 40 employees and 14 or more reported injuries that resulted in time off or restricted work during 2007. OSHA cites several activities in these facilities that can result in injury or illness including injuries due to resident handling, slips and falls, exposure to blood and infectious materials, as well as ergonomic injuries. Facilities should prepare for a possible OSHA inspection by conducting their own self audit to ensure that they are complying with all OSHA procedures and record keeping requirements. Further, proper training for managers on how to respond to OSHA inquiries and audits is imperative.

Businesses that have been through an OSHA audit know how time consuming and intrusive such an audit can be. The first step in the audit is the opening conference. At that time, an OSHA compliance officer provides the facility with information regarding the audit process and verifies the facility’s eligibility for inspection. Once the conference is over, the OSHA officer will request the 2007 and 2008 records, and the facility must provide them to the compliance officer within 4 hours. Importantly, the compliance officer does not have to wait to receive the records before he or she can begin a walk around inspection of the facility and interviews of employees. During the walk around inspection, the compliance officer has the authority to issue citations for any plain view OSHA violations.

Once the records have been provided, the compliance officer will review approximately 100 employee records from 2007. The OSHA compliance officer gets to pick and choose which 100 records he or she reviews. However, if the facility has 100 or less employees, that means all employee records, which include, without limitation, medical records, worker’s compensation records, insurance records, payroll and absentee records, will be reviewed.

The compliance officer will also conduct interviews. OSHA will interview employees, management and medical aid providers, as well as individuals responsible for record keeping. Human resources professionals will also be interviewed in order to determine if the management of the facility tries to exert any negative influence regarding reporting injuries. The officer then determines if an under-reporting of injuries or illnesses is occurring at the facility, and if such a determination is made, citations ranging in the categories from serious to willful will be issued. Facilities that have implemented and uniformly enforced disciplinary procedures for safety violations will more than likely be given less serious violations while other facilities who have incentive programs that inhibit the reporting of injuries may be assessed with more stringent violations.

Businesses that OSHA later deems to be “high risk injury” industries will more than likely be subjected to similar OSHA audits. Consequently, it is extremely important for the “high risk injury” industries to either: 1) perform an internal self audit; or 2) hire outside counsel to monitor its records or books before OSHA comes knocking.

Might States Strip an Employer of its Business License for Employing Unauthorized Aliens?

Jarae Carlson — Fri, 06 Nov 2009 00:00:00 -0500

While the Obama administration has not yet rolled up its sleeves to tackle comprehensive immigration reform, it may soon have to. During his campaign, Obama acknowledged the need for reform at the federal level, rather than having state or local governments implement their own reforms. Earlier this week, the U.S. Supreme Court asked the U.S. Solicitor General to share the views of the United States on a challenge to an Arizona statute that allows the state’s superior courts to suspend or revoke the licenses of businesses that knowingly or intentionally hire unauthorized aliens. The 9th Circuit Court of Appeals has held that the Legal Arizona Workers Act, which was enacted in 2007 but has not yet been enforced, is a “licensing law” and thus, not preempted by the federal Immigration Reform and Control Act of 1986 (“IRCA”). Although IRCA likewise prohibits employers from knowingly or intentionally hiring or continuing to employ unauthorized aliens, its violation does not expose an employer to the suspension or revocation of its license to conduct business.
The plaintiffs (businesses and civil rights organizations) have sought review by the U.S. Supreme Court. We do not yet know if the Court will take it up, but you can bet that other states with large populations of potentially unauthorized aliens will watch this case closely to see if they too would like to implement some “reforms” of their own if the U.S. Congress fails to take the lead.

November 21: Are you ready for GINA in your workplace?

Monica Velazquez — Mon, 02 Nov 2009 00:00:00 -0500

The Genetic Information Nondiscrimination Act of 2008 (GINA) became law in May 2008. GINA prohibits discrimination by health insurers and employers based on an individual’s genetic information. GINA has two parts. Title I applies to group health plans sponsored by private employers, unions, and state and local government employers, issuers in the group and individual health insurance markets, and issuers of Medicare supplemental (Medigap) insurance. Title II applies to employers and other entities with 15 or more employees (same entities covered by Title VII of the Civil Rights Act of 1964). The Equal Employment Opportunity Commission (EEOC) has issued proposed regulations under Title II of GINA for covered employers. Title II of GINA and its regulations go into effect on November 21, 2009.

GINA prohibits the use of genetic information in employment, restricts the acquisition of genetic information, and strictly limits the disclosure of genetic information. Congress enacted GINA to address these concerns so that the general public would not fear adverse employment- or health coverage-related consequences for having a genetic test or participating in research studies that examine genetic information.

What Does GINA Prohibit?

GINA prohibits all forms of disparate treatment employment discrimination against applicants, employees, and former employees based on genetic information. This specifically includes limiting, classifying, or segregating employees based on genetic information. Thus, if an employee is known to have a genetic predisposition to a disease, the employee could not be excluded from a position that might exacerbate his condition. The prohibition on the use of genetic information is absolute – covered entities may not use genetic information in making employment decisions under any circumstances. GINA also prohibits retaliation against persons who oppose discrimination and requires confidentiality with respect to genetic information (with limited exceptions).

To learn more, the EEOC has issued guidance materials on GINA, available at http://www.eeoc.gov/policy/docs/qanda_geneticinfo.html

What Practical Steps Should Employers Take?

As with any new law or regulations, employers should:

1.                  Post the new required poster from the EEOC, available at http://www.eeoc.gov/self_print_poster.pdf

2.                  Revise EEO policies to include prohibition against discrimination based on genetic information.

3.                  Train personnel on the requirements of GINA, especially those who interview and hire new employees.

4.                  If you require post-offer, pre-employment medical examinations or return to work/fitness for duty examinations, make sure the exams and forms requested do not include any inquiries about family medical history.

5.                  In discussing reasonable accommodations for a disability or requests for medical leave, employers should not seek genetic information. The EEOC suggests as a “best practice" that employers who ask employees to have health care professionals provide documentation to specifically state in the request that family medical history or other genetic information should not be provided.

6.                  Avoid storing family medical history information in personnel files, as this is genetic information that must be stored in a separate medical file.

Department of Homeland Security Rescinds “No-Match” Rule

Martin Thornthwaite — Mon, 12 Oct 2009 00:00:00 -0500

On October 7, 2009, The Department of Homeland Security (“DHS”) rescinded the controversial Social Security no-match rule. The rescission will take effect on November 6, 2009.
In August of 2007, the Bush administration issued the no-match rule in an effort to identify immigrants working in the United States illegally. The rule outlined an employer’s obligations in response to the receipt of a Social Security Administration (“SSA”) no-match letter. DHS would have had more power to penalize employers of illegal immigrants. Specifically, DHS would have had the ability to issue steep fines against employers and potentially seek criminal sanctions against employers for failing to terminate workers that could not reconcile Social Security account discrepancies within 90 days.

Industry groups immediately challenged the rule and claimed it would cause significant difficulties for businesses and the loss of many thousands of jobs of legal workers due to reliance on inaccurate government databases. For example, typographical errors made on w-2 earnings reports and unreported name changes could easily trigger an erroneous no-match letter.

A coalition subsequently sued the DHS and SSA to stop the rule from taking effect. A temporary restraining order was granted by a U.S. District Court and a preliminary injunction was later approved to prohibit threatening no-match letters from being issued. The court determined such letters would cause “irreparable damage to innocent workers.”

As an alternative and more effective way to address employee eligibility, DHS encourages employers to use the E-Verify system. E-Verify compares information from the Employment Eligibility Verification Form (I-9) with federal databases to confirm workers’ employment eligibility. The program is a free, web-based system operated by the DHS and SSA. As of last month, all federal contractors for qualifying jobs are now required to use the E-Verify system. Further, in another effort to curb the hiring of illegal immigrants, U.S. Immigration and Customs Enforcement (“ICE”) also announced last month it would be stepping up its audit and investigation of employers suspected of knowingly employing illegal workers.

Periodic auditing of your employees’ I-9 forms to ensure compliance with applicable laws is important. If you have questions regarding performing an audit, please contact Strasburger. Strasburger can also advise you on concerns related to the immigration status of employees and whether or how to take employment actions in such cases.

Congress Tees Up to Slap Down the Supreme Court's Gross Decision

Tiffany G. Hildreth — Wed, 07 Oct 2009 00:00:00 -0500

On October 6, 2009, Senators Harkins (D. Iowa), Leahy (D. Vt.), and Miller (D. Calif.) introduced proposed legislation entitled “Protecting Older Workers against Discrimination Act” for the “simple purpose of reversing the Court’s decision and restoring the law to what it was for decades.” The proposed law directly responds to the U.S. Supreme Court’s June 18, 2009, decision in Gross v. FBL Financial Servs., Inc. wherein the Court held that plaintiffs alleging age discrimination under the Age Discrimination and Employment Act cannot prevail under the “mixed motives” burden of proof standard. As such, plaintiffs seeking recourse under the ADEA must prove by a preponderance of the evidence that “but for” their age, the employer would not have taken the adverse employment action; plaintiffs cannot simply show that age was one of the motivating factors in an employer’s decision.

Senator Leahy and his co-sponsors believe that the proposed legislation will “restore vital civil rights protections” for older workers by reversing the Gross decision to make clear that establishing discrimination as a “motivating factor” behind employment decisions is sufficient proof to prevail on ADEA claims and puts the burden “properly on the employer to show that it complied with the law.” As further justification, Senator Leahy represented that older workers “make up nearly 50% of the American work force” and “are particularly vulnerable to suffering discrimination during difficult economic times.” Senator Leahy’s statement points to statistics showing that age discrimination complaints filed with the EEOC have “jumped nearly 30% between 2007 and 2008.”

Readers will recall that when the Gross decision was released in June, it was immediately predicted that Congress would react strongly and swiftly just as it did in response to the Ledbetter v. Goodyear decision of a few years earlier which led to the enactment of the Lily Ledbetter Fair Pay Act.

EEOC has a Renewed Interest in Age Discrimination

Kimberly S. Moore — Mon, 31 Aug 2009 00:00:00 -0500

Using Dallas-based AT&T as one example, the EEOC filed a class action last week alleging that AT&T discriminated against retired workers by refusing to re-employ a disproportionate number. The ADEA lawsuit claims a disparate impact on older employees who elected to retire or take severance as well as disparate treatment. The EEOC indicated its intent to vigorously enforce age discrimination claims. The EEOC also recently published a press release highlighting the devastating impact age discrimination has on employees. In this economy, downsizing is a frequent occurrence where alleged age bias is claimed. Raytheon was recently sued because human resources managers supposedly used phrases like reducing people with “too much seniority,” seeking those with “contemporary skills” and the “next generation.”

Even seemingly innocent comments like “doing more with cheaper people” was said to imply age bias because the younger people were cheaper. Fortunately for Raytheon, none of these statements alone are sufficient to prove age bias. Such statements are interesting to show what employees perceive about the basis for separation decisions and such remarks frequently lead to misunderstandings and age discrimination lawsuits. Importantly, given the EEOC’s proclamation about its vigilance against age claims, now is the time to be particularly mindful such misunderstandings do not lead to a finding by the EEOC that age played a role in any employment decision and, instead, that employment decisions are unquestionably without regard to age.

It Sounds Like the Start of a Joke, but it’s Not Funny: When is an Employer’s Computer System Not the Employer’s Computer System?

Jana H. Woelfel — Mon, 17 Aug 2009 00:00:00 -0500

Smart employers implement policies which define computer hardware and information systems provided by the employer to be the property of the employer. Even smarter employers include language in their policies that state that the computer is to be used for business purposes and that the employer reserves the right to review any and all documents, emails or other materials on the computer at any time. Such policies make it clear that an employee has no reasonable expectation of privacy on information stored on the employer’s computer system. There are a number of reasons these policies are beneficial. They allow employers to ensure that an employee isn’t using the employers’ systems for another business venture, illegal activities or otherwise engaged in conduct contrary to the employers’ interests, and the list goes on.
But there are limits to how far courts will enforce these policies, and a wise employer will verify with counsel how far it may prudently examine an employee’s communications, particularly those which might be subject to privilege.

Some courts have held that a computer use policy which puts the employee on notice that he has no reasonable expectation of privacy is sufficient to waive attorney-client privilege when an employee uses the company’s corporate email system to communicate with his counsel. See, Scott v. Beth Israel Med. Center, Inc., 17 Misc. 3d 934, 847 N.Y.S.2d 436 (N.Y. Sup. Ct. 2007) (holding that physician’s email communications with his attorney on hospital’s email server were not confidential, and thus not privileged); In re Asia Global Crossing, Ltd. 322 B.R. 247 (S.D.N.Y. 2005) (no attorney-client privilege or work product protection for emails exchanged on employer’s email system). However, emailing one’s attorney on a company computer does not necessarily make that communication fair game, as one company recently learned the hard way.

Recently, an appellate court in New Jersey decided that an employee accessing her personal, web-based, password-protected Yahoo account from her company computer was still cloaked with an expectation of privacy, despite policies which arguably put the employee on notice that all activity on her computer might be monitored. In Stengart v. Loving Care Agency, Inc., 408 N.J. Super. 54, 973 A.2d 390 (N.J. Super. Ct. App. Div. 2009), the employee communicated with her attorney about her potential litigation against her employer using her Yahoo email account, but which account she accessed from work on occasion. Because of her access of the account on her work computer, certain residual data was left on her computer which allowed the employer to retrieve and read the emails between the employee and her attorney after it obtained a forensic image of her hard drive once she had filed suit against the company. The employer’s lawyers asserted that the emails were not privileged because the employee had no reasonable expectation of privacy in communicating with her counsel on her work computer.

The New Jersey appellate court disagreed, finding that a variety of “highly personal and confidential” communications now regularly occur via the Internet and may be performed quickly from anywhere. The court noted that the company had considered several computer use policies and the record was not terribly clear as to which policy was in effect. Further, the court found that the expectation of privacy could not be voided by an employer’s unilateral policy where other indicia suggested the employee considered the communication confidential. The court held that the attorney-client privilege was “venerable” and would not be waived lightly. Thus, consideration of whether there was some indication the employee intended the communication to be private, the scope of the employer’s policy, and its history of enforcement of such policy, was appropriate. Significantly, because Loving Care’s counsel had reviewed the email correspondence, the appellate court sent the case down for a review of sanctions and whether disqualification of the employer’s counsel was required.

Simply, computer use policies can be very effective tools for retaining control and efficient operation of an employer’s computer systems. But they are not sacrosanct. In light of Loving Care, a prudent employer will proceed cautiously in reviewing anything found on its computer systems which might be fairly characterized as confidential.

Think Twice Before Implementing Cost Cutting Strategies in the Form of Salary Deductions for Exempt Employees

Francine W. Breckenridge — Wed, 29 Jul 2009 00:00:00 -0500

Times are tough, so employers are forced to make tough decisions with respect to their current workforce. One not so bright idea would be to temporarily reduce the number of work hours for exempt employees and pro-rate their pay. Following such a recommendation could lead to disaster. Caution must be taken prior to reducing exempt employees’ salaries in order to avoid violating the Fair Labor Standards Act (FLSA). Under the FLSA, an exempt employee must be paid a full weekly wage, no matter how many or how few hours the employee works per week. Whether the exempt employee works 20, 30, or 60 hours per week, he or she must be paid the full weekly salary. Reducing an exempt employee’s salary when business is slow can alter the exempt status of every person in the same job or category to a non-exempt status. As a result, the Department of Labor could require the employer to go back and pay those employees for any overtime they have worked in the past 2 to 3 years.

An employer may reduce the amount exempt employees are paid, as long as that change affects all the employees in the same job or classification and is a permanent change. In order to be considered “permanent,” the salary reduction must be in effect for at least 3 months and it cannot be presented to the employees as a temporary measure. Reducing the hours for exempt employees when salaries are also reduced is a gray area. According to information from the Society of Human Resources Management (SHRM), when a reduction in both salary and hours for an entire class of exempt employees is part of a change in business strategy, employees may still retain their exempt status. As such, the practical approach would be to permanently reduce the salary of an entire group or class of employees and, if required, enact the new business strategy reducing normal office hours or the number of days in a work week.

The NLRB Should Soon be Back to Full Strength with Obama Nominations

Paul L. Myers — Mon, 20 Jul 2009 00:00:00 -0500

Recently, President Obama announced his intent to nominate Brian Hayes to fill the third of the three vacant seats on the National Labor Relations Board (NLRB). Hayes currently serves as the Republican Labor Policy Director for the U.S. Senate Committee on Health, Education, Labor and Pensions. Previously, Hayes was in private practice for more than 25 years, representing management in labor and employment matters.

Traditionally, a sitting President nominates three of the five NLRB members from his own political party and two from the opposing political party. Since the end of 2007, the NLRB has had only two sitting members: Wilma B. Liebman, a Democrat appointed by President Clinton, and Peter C. Schaumber, a Republican appointed by President Bush.

Last April, President Obama announced his intent to nominate Craig Becker and Mark Pearce for two of the vacant seats on the NLRB. Becker currently serves as Associate General Counsel to both the Service Employees International Union and the AFL-CIO. Pearce is a union-side labor lawyer and named partner in the Buffalo, New York law firm of Creighton, Pearce, Johnsen & Giroux. All three of President Obama’s nominees will now be submitted to the Senate for confirmation.

An interesting question remains regarding the validity of the decisions and orders issued by the two-member Board since the end of 2007. In Laurel Baye Healthcare of Lake Lanier, Inc. v. NLRB, 564 F.3d 469 (D.C. Cir. 2009), the Court of Appeals for the DC Circuit held that the two-member Board lacks the authority to issue orders because it lacks a quorum of members. However, in New Process Steel, L.P. v. NLRB, 564 F.3d 840 (7th Cir. 2009) the Court of Appeals for the Seventh Circuit held that the orders of a two-member Board were valid. More than 400 decisions and orders have been issued by the two-member Board since the end of 2007.

Arbitration Provision Contained In Non-Subscriber Employer’s Occupational Injury Plan Agreement Is Binding On Decedent’s Surviving Beneficiaries’ Wrongful Death Claims

Martin Thornthwaite — Thu, 25 Jun 2009 00:00:00 -0500

The Texas Supreme Court recently held that the arbitration provision in an agreement between a decedent and his nonsubscriber employer required “the employee’s wrongful death beneficiaries to arbitrate their wrongful death claims against the employer even though they did not sign the agreement.” In re Labatt Food Service, L.P., 279 S.W.3d 640, 642 (Tex. 2009); see also In re Jindal Saw Ltd., --- S.W.3d ---, 2009 WL 490082 (Tex. 2009). The case concerned an occupational injury plan agreement the decedent executed as an employee with Labatt Food Service, L.P. (“Labatt”), a non-subscriber under Texas workers’ compensation laws. The agreement contained a mandatory arbitration provision and stated that the employee elected to be “covered under the plan ‘individually and on behalf of heirs and beneficiaries.’” Id.
After the decedent died from an apparent asthma attack while at work, his surviving beneficiaries brought a wrongful death lawsuit against Labatt. Labatt filed a motion to compel arbitration, and the beneficiaries objected and argued that they were not bound by the agreement because they were not signatories to it. The trial court denied Labatt’s motion and the court of appeals denied mandamus relief. The Texas Supreme Court reasoned that if the employee had personally sued Labatt for his injuries immediately prior to his death, he would have been bound to arbitrate his claims. Thus, since his beneficiaries’ wrongful death action was entirely derivative of his rights, the trial court abused its discretion by refusing to compel arbitration.

In rendering its decision in Labatt, the Texas Supreme Court disapproved of two contrary holdings by Texas appellate courts. See In re Kepka, 178 S.W.3d 279, 288 (Tex. App.—Houston [1st Dist.] 2005, mand. dism’d); Gomez v. Zardenetta, No. 04-97-0019-CV, 1998 WL 19858, at *7 (Tex. App.—San Antonio 1998, no pet.). Texas law strongly favors the arbitration of disputes whenever possible, and this case is another example of the Texas Supreme Court’s propensity to enforce arbitration agreements.

Free Speech / Defamatory Speech

Jana Woelfel — Wed, 20 May 2009 00:00:00 -0500

Public statements regarding your company's commitment to sound EEO practices may leave you open to attack by detractors. In Fall 2008, Ed Doherty, the owner of 80 Applebee's restaurants in New Jersey, New York and Pennsylvania, was interviewed by the local Hackensack paper in a profile piece. In the interview, Mr. Doherty said he treats employees "with dignity and respect" and he was successful because of his practice of following the Golden Rule. Pretty basic puff piece, right?

Well, Michael Murray didn't agree and made that clear by posting a comment to the online article stating that women employees were regularly sexually harassed at Doherty's restaurants and that the behavior was condoned up to the top of the organization. He also accused managers of perjury, obstruction and ignoring harassment claims. Finally, he stated that other women working for Doherty were more than likely to be subjected to similar treatment. Murray asserted he was knowledgeable because of the pro se assistance he had rendered his daughter in her arbitration of a sexual harassment claim against Doherty Enterprises.

Doherty Enterprises sued Murray for defamation based upon his comment. A New Jersey court dismissed Doherty's claims on summary judgment, finding that Murray's comments were protected opinion. The court acknowledged that Doherty, as a franchise owner, was not a public figure, but by commenting in the article on his treatment of employees, he made the issue one of legitimate public concern. After the summary judgment was granted dismissing Doherty's claims, the only remaining triable issues were Murray's claims for abuse of process.

While the facts of the case are unique, the decision can serve as a good reminder of the importance of paying careful attention to the audience and the message. It may very well be prudent to weigh what may be gained by commenting on your employment policies in a public forum against the criticism such speech may open you up to.

More Defections from the EFCA

Tiffany G. Hildreth — Thu, 09 Apr 2009 00:00:00 -0500

Earlier this week, another Democrat Senator announced her opposition to the present form of the Employer Free Choice Act (“EFCA”). On Monday, Senator Blanche Lincoln, D-Arkansas, announced that she will vote against the EFCA, and against moving it beyond a Republican filibuster. As has been the case with other recent announcements, Senator Lincoln voted in favor of the EFCA in 2007 and is up for reelection in 2010. Another factor that may have had some impact on her decision is that WalMart, a longtime opponent of unionization, is headquartered in Arkansas. Based on the number of votes needed to pass the EFCA, the Act in its present form, appears to be in trouble.

Is the troubled economy leading to the EFCA’s demise?

Tiffany G. Hildreth — Mon, 06 Apr 2009 00:00:00 -0500

Opponents of the Employee Free Choice Act may be in the unfortunate position of hoping the economy continues to decline at least a little while longer. Another senator that co-sponsored the EFCA in 2007 is indicating a lack of enthusiasm for the Act in 2009 due to economic concerns. According to the San Francisco Chronicle, a spokesperson for Senator Dianne Feinstein, D-Ca., said that the Senator had not renewed her co-sponsorship of the Act "because of concerns about this extraordinarily difficult economy. She is taking a serious look at the legislation but has not taken a position."

In the meantime, while EFCA components continue to be introduced in the legislature through various bills, other bills are being proposed which flatly contradict the EFCA's goals. Companion legislation (H.R. 1176/S. 478) that would require union representation to be based upon a secret-ballot election supervised by the NLRB was recently introduced in both houses. These bills directly contravene the EFCA's attempts to require union recognition without the need for a secret-ballot election, so long as a majority of the workers support the union in a card check."

Is this a set back for the EFCA?

Tiffany G. Hildreth — Thu, 26 Mar 2009 00:00:00 -0500

On Tuesday, proponents of the Employee Free Choice Act (”EFCA”) were dealt what many are saying is a severe setback. U.S. Senator Arlen Specter (R-Pa.) publicly announced that he would vote against a cloture motion to limit debate on the EFCA. A cloture motion seeks to limit “debate” which can turn into “filibustering” on a bill, thereby forcing the legislature to stop discussing the bill and vote on the bill’s passage. According to sources, 60 Senate votes were needed to support the cloture motion related to the EFCA, and Senator Spector was expected to be the 60th vote, assuming all Democrats supported the cloture motion and all Republicans opposed it. Accordingly, if Senator Specter votes against the cloture motion, the EFCA’s proponents will not have the 60 votes they need to override an anticipated Republican filibuster of the proposed legislation and its possible that Senate would not be able to vote on the bill’s passage. If the Senate ever had the opportunity to vote on the EFCA itself, passage of the bill would require only 51 votes and would not depend on any support from Republican senators.

Senator Specter justified his decision on two aspects of the proposed legislation - elimination of the secret ballot and compulsory, binding arbitration - as well as “poor timing” due to the economic recession. The full text of Senator Specter’s announcement is presented on his website (http://specter.senate.gov/public/)

Senator Specter’s announcement disappointed EFCA supporters because he has historically supported the EFCA. Moreover, his representative state, Pennsylvania, is generally considered to be pro-labor. Numerous commentators have opined that the Senator took this course in order to improve his chances against his Republican primary opponent and that he may change his tune if he prevails in the primary election. Indeed, the Senator noted that “if efforts are unsuccessful to give Labor sufficient bargaining power through amendments to the NLRA, then I would be willing to reconsider Employees’ Free Choice legislation when the economy returns to normalcy.”

Make sure you know what may be lurking around the corner

Tiffany G. Hildreth — Thu, 12 Mar 2009 00:00:00 -0500

By now, almost every employer has heard about proposed legislation called the Employer Free Choice Act (“EFCA”) and the supposed support it enjoys within parts of Congress and from President Obama. The EFCA has been circulated around for several years, but it appears that 2009 may be the year that it, or certain aspects of it, actually have a chance of passing into law.

Employers should be aware of what is currently being discussed. Recent EFCA discussions focus on three issues: union organization, bargaining, and imposition of penalties on employers as opposed to remedial measures.

Union Organization

Presently, in order to organize and establish a union at a particular employer, a union that obtains authorization cards from at least 30 percent of employees of the bargaining unit can petition the National Labor Relations Board (“NLRB”) to certify that union as the collective bargaining agent for the employees of that employer. The employer can, however, demand a secret ballot election to decide the issue. This two-step process often gives employers a chance to campaign against the union or at least provide the employees with a non-union perspective before a final determination is made.

Under the EFCA, once a union presents authorization cards for a 51% majority of an employer's workers, the NLRB must certify the union as the representative of the employee group for at least one year. In this situation, the employer no longer has the option of requiring a secret ballot election.

The difference? A union can be created right under an employer’s nose before the employer even knows what’s happening.

Bargaining

If a union represents employees, current law requires the union and the employer to bargain in “good faith” as to terms and conditions of employment. The current law does not require an ultimate agreement. Unions can strike if no agreement occurs, or employers can implement what they believe are their last best offers.

The EFCA looks to significantly change this process. While the process would still begin with negotiations between the union and the employer, if negotiations do not result in an agreement within 90 days, the parties would mediate. If the mediation is unsuccessful, the parties would submit to binding arbitration. The arbitrator would decide the terms and conditions of the agreement and such agreement would be effective for at least two years.

All of this means that, at some point, a collective bargaining agreement may be put into place containing terms that were decided by someone other than the parties to the agreement.

Penalties

Currently, remedies for labor law violations are generally remedial. But, the EFCA is trying to change this by imposing increased penalties on employers found to have violated labor laws. The NLRB would be required, not just allowed in its discretion, to seek federal injunctive releif against such employers. Employers found to have illegally discharged an employee might be liable for back pay of lost wages, as well as an additional penalty of two times the back pay amount. Employers could also face a penalty of $20,000 for willful unfair labor practices.