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    Welcome to the Labor and Employment Law Update where attorneys from SmithAmundsen blog about management side labor and employment issues. We cover topics including addressing harassment and discrimination in the workplace, developing labor law, navigating through ADA(AA), FMLA and workers’ compensation issues, avoiding wage and hour landmines, key legislative, case law and regulatory changes and much more!

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    The Labor and Employment Law Update is provided for information purposes only, and should not be construed as legal advice on any subject matter, nor should it be construed as creating an attorney client relationship. Do not send confidential information or facts about a legal matter. The opinions of this blog's contributors do not reflect the opinions of SmithAmundsen LLC as a whole. See the disclaimer page for further information.

Employers Could be Held Liable for Supervisors’ Comments and Use of Facebook

Posted on April 3, 2013 by smithamundsen

Contributed by Michael Wong

One of the biggest issues for employers is how much the internet and social media can be used to find information posted by or about employees.  However, how many employers consider their own social media footprint and who is contributing to it?  While an employer may be cognizant of what it posts on the internet, it should also be concerned about what managers and supervisors are posting on the internet and social media (Facebook, LinkedIn, MySpace, Google+, blogs, etc.).

As what has generally come to be recognized as the “Cat’s Paw” theory, the actions of a supervisor, even one who is not a decision maker, could be conveyed upon an employer to support the imposition of liability.  Staub v. Proctor Hospital, 131 S.Ct. at 1193.  As explained in Staub, because a supervisor is an agent of the employer, when he or she causes an adverse employment action the employer causes it; and when discrimination is a motivating factor in the supervisor doing so, it is a motivating factor in the employer’s action. 131 S.Ct. at 1193.

Under the Cat’s Paw theory it is possible that an employer could be subjected to liability based on its owners’, directors’, managers’ and supervisors’ personal use of social media, including Facebook.  This became even more evident when the District Court for the Middle District of Tennessee held that posts on a company blog, posts on a manager’s personal Facebook page (even when removed) and a manager’s verbal comments, were sufficient evidence to create a genuine dispute of facts concerning one employee’s retaliation claim and another employee’s constructive discharge retaliation claim in a FLSA class case. Stewart v. CUS Nashville, LLC, 3:11-CV-0342, 2013 WL 456482 (M.D. Tenn. Feb. 6, 2013). 

In Stewart, the court found that a blog entry on the company’s website by its founder and president that “referenced a lawsuit initiated by someone who had been previously terminated for theft and contained the following statement directed to that individual: ‘Fu** that b*tch’” was sufficient evidence to allow a jury to find retaliation in violation of the FLSA. The court went on to find that the company’s Director of Operation’s post on Facebook, while intoxicated, stating “Dear God, please don’t let me kill the girl that is suing me . . . that is all . . .” and similar verbal comments while the employee was present, were sufficient evidence to allow a jury to find the employee was constructively discharged in retaliation for joining the FLSA lawsuit. While the court did not find the evidence was enough to grant either party summary judgment, the use of social media lead to the employer being faced with the uncertainty of liability and costs of a trial.

Bottom line: Employers must be aware that they could be held liable not only for what they post on the internet, but what their directors, managers and supervisors post on the internet.

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Heads Up California Employers: A New Year Brings New Procedures for Investigating Employment Discrimination Complaints

Posted on February 14, 2013 by smithamundsen

Contributed by Carly Zuba

Beginning January 1, 2013, the California Fair Employment and Housing Act (FEHA) took on an entirely new look, thereby amending, repealing and adding to various provisions of FEHA.  These changes affect any employer with five or more employees working in California.

Notably, the new FEHA differs from the old FEHA in the following respects:

  • Elimination of the Fair Employment and Housing Commission (FEHC).
  • Creation of new authority for the Department of Fair Employment and Housing (DFEH) in enforcing FEHA and promulgating rules.  FEHC’s former regulatory and rulemaking functions were handed over to a seven-member Fair Employment and Housing Council within DFEH.  As such, employers should anticipate possible new regulations coming down the pike sometime this year.  Hopefully, some of these regulations will provide clarification to employers on some of the more complex areas of California employment discrimination law.  In addition, the council will conduct hearings on FEHA regulations and civil rights issues. Employers can participate in the rulemaking process by providing feedback and comments to the council. 
  • Authorization for DFEH to file cases directly in court.  If a discrimination claim before the DFEH is not resolved through mediation, conference, etc., DFEH can now bring a civil action against the employer on behalf of the Complainant, thereby standing in the place of the individual who originally brought the claim.  Employers will need to begin evaluating the differences between defending cases brought by DFEH versus cases brought by private attorneys. And, most significantly, the former caps on damages for claims brought to the FEHC have vanished – in contrast, there are essentially no caps on damages plaintiffs may recover in court.
  • Creation of mandatory dispute resolution procedure, before DFEH can proceed to court.  DFEH has a new Dispute Resolution Division.  Dispute resolution is now mandatory for all cases in which DFEH intends to file a civil action.  These dispute resolution services are provided to the parties free of charge.  The good news for employers and employees alike is that DFEH’s dispute resolution services boast an 80% settlement rate.
  • Ability for DFEH to collect attorneys’ fees and costs when it is the prevailing party in FEHA litigation.  If DFEH prevails in court, it can now obtain reasonable attorneys’ fees and costs, including but not limited to expert witness fees.  These fees and costs will be deposited into a Litigation Fund in the State Treasury. 

Of course, it is a bit too early to predict how these changes will truly affect the substance and volume of FEHA employment discrimination litigation.  Stay tuned, California employers…

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FMLA Amended For Airline Flight Crews

Posted on February 13, 2013 by smithamundsen

Contributed by Karuna Brunk

The Department of Labor (DOL) issued a statement regarding expanded protection to military families.  Hidden in the discussion of military families and DOL’s commitment to those who serve was a single statement about added regulations to the Family Medical Leave Act for airline flight crew employees.   

In fact, on February 5, 2013, DOL issued a final rule to implement the Airline Flight Crew Technical Corrections Act, which established leave eligibility requirements for airline flight crewmembers and attendants.  Essentially, the new rule attempts to account for airline employees’ unusual and unique work schedules. 

The Specifics for Aviation Employers:

  • DOL’s new rule implements a minimum hourly work requirement for airline employees to be eligible for FMLA leave.  For airline flight employees to be eligible for FMLA under the new amendments, they must have worked or been paid for not less than 60 percent of the applicable total monthly guarantee.  Additionally, they must have worked or been paid for not less than 504 hours during the 12 months prior to their leave. 
  • The DOL rule entitles airline flight crew employees to 72 days of leave during any 12-month period for one or more FMLA-qualifying reasons (i.e. birth of a child, care of a family member, serious health condition, etc.).  DOL established the 72 days of leave based on a six-day workweek for all airline flight crew employees, regardless of how much time the employees actually worked.  This was multiplied by the statutory 12-workweek entitlement under FMLA. 
  • Because DOL has recalculated how much leave an airline flight crew employee can take based on days, employers must track FMLA leave, intermittent leave, or a reduced schedule in increments of one day. 
  • Employers have new record keeping requirements – record and keep documents that contain information specifying the monthly FMLA guarantee for each category of employee, including any copies of collective bargaining agreements or employer policy documents.  Also employers should record the hours worked and hours paid for each employee.  

The Department of Labor has released a new FMLA poster discussing the new final rule that can be found here.

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Updated Fair Credit Reporting Act – What Does That Mean For Employers Who Perform Background Checks?

Posted on January 31, 2013 by smithamundsen

Contributed by Heather Bailey

Not too much.  However, effective July 2011 pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, there is a new sheriff in town and its name is the Consumer Financial Protection Bureau, which will now have the rulemaking and enforcement powers over the FCRA instead of the Federal Trade Commission. 

Effective January 1, 2013, the Bureau implemented an interim FCRA rule.  The good news is, there were no substantive changes in the way employers notify applicants and employees about background checks (i.e., the consent form, pre-adverse action notice, and post-adverse action notices if any such actions are taken).   The only change employers need to worry themselves with is the new “Summary of Your Rights Under the Fair Credit Reporting Act” notice that is given to applicable applicants and employees. The revised notice can be found at http://www.gpo.gov/fdsys/pkg/FR-2012-11-14/pdf/2012-27581.pdf, page 67748 (or page 5 of the actual document).

The only other significant change for employers is they will start receiving a “Notice to Users of Consumer Reports of their Obligations” from their vendors who perform the background checks as this is now required of them.  Be on the look-out for future updates to this existing law by the Consumer Financial Protection Bureau as it does not seem like it is done with its new authority.

If you do background checks on applicants and/or employees for any reason and you do not currently have a system in place for properly getting consent or notifying employees appropriately under the requirements of the FCRA, it is imperative you speak with counsel immediately to institute a practice for compliance.

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The National Labor Relations Board Wants You!

Posted on January 15, 2013 by smithamundsen

Contributed by Caryl Flannery

Ok, maybe not you, but the Board definitely wants your non-union employees and they’re using Section 7 of the NLRA to get them. 

In the past, Section 7 was looked upon primarily as bestowing the right to formally organize in labor unions.  Over the last few years, however, the Board has been focusing on the section of the law which secures the right to engage in “other concerted activities for the purpose of collective bargaining or other mutual aid or protection.”  NLRA, Sec. 7.  It turns out the NLRB is of the opinion that those “other concerted activities” come under a pretty big umbrella and has been spreading the good news to non-union employees everywhere.  In 2012, the NLRB ratcheted up their campaign by implementing a new page on their website called “Protected Concerted Activity” where they invite non-union employees to read NLRB Section 7 success stories “of workers across the country.” Areas in which the Board has asserted jurisdiction in the last year include:

  • Social media policies – Last month, the Board ordered a private social services agency to reinstate five employees who were terminated for posting comments about their jobs on Facebook.  Although the postings included profanity and criticism of another employee the Board found that the comments were protected because the original post included an invitation for comment from other employees on a work-related issue.
  • Internal disciplinary investigations – Threatening the integrity of employers’ internal investigations of employee misconduct, the Board has held that employers can instruct employees not to discuss matters under investigation only where they can show a specific need to do so.
  • “At will” statements in employee handbooks – The NLRB held that a statement in a handbook declaring that an employee’s “at will” status could not be modified under any circumstances violated the NRLA because it failed to make clear that union organizing and collective bargaining could alter the “at will” relationship.
  • Class action waivers – Although at odds with several courts, the NLRB continues to maintain that waivers of class or collective action in arbitration agreements violate Section 7.
  • Challenges to termination of employment – Disgruntled discharged employees who can’t make out a colorable EEOC claim are now filing unfair labor practice charges alleging termination in retaliation for engaging in concerted protected activity, such as complaining about safety concerns.  The Board obligingly investigates all charges which, even if ultimately dismissed, can be costly to defend in terms of disruption of business and related costs.

What’s an employer to do?  Carefully draft policies and handbooks and review disciplinary practices for language or procedures that could be viewed as chilling or restricting concerted activity.  Focusing on clearly unprotected activity (such as Facebook posts that could constitute unlawful harassment) will deter unwanted attention from the NLRB.

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Unemployed Job Applicants Need Not Apply…

Posted on July 9, 2012 by smithamundsen

Contributed by Samantha Esmond

In March, the District of Columbia enacted the first law in the nation to prohibit discrimination against unemployed job applicants. The Unemployed Anti-Discrimination Act of 2012, signed by Mayor Vincent C. Gray, makes it unlawful for employers and employment agencies to consider the employment status of a job applicant in making employment and hiring decisions. This law also bars employers from indicating in a job advertisement that unemployed individuals are either disqualified for the job or that unemployed individuals will not be considered or hired for the vacant position. Employers who violate this law will be subject to civil penalties not to exceed $20,000 per violation.

While the District of Columbia is certainly at the forefront, passage of similar laws may become a national trend. With the unemployment rate still hovering around 8%, more and more states may be considering passage of similar laws.

The California assembly is currently considering passage of a similar bill. Assembly Bill 1450 introduced on January 5, 2012 by Assembly Member Allen, would make it unlawful for an employer, employment agency, or person who operates an internet website for posting jobs in California to refuse to hire a person because of that person’s employment status. California AB 1450 further prohibits the publishing of an advertisement or announcement for any job that includes provisions stating or indicating that a person’s current employment is a requirement for a job or that unemployed applicants will be not considered based on that person’s employment status.

Other state legislatures, such as Michigan, with Senate Bill No. 606 titled “The Fair Consideration of the Unemployed Act,” are currently considering laws which prohibit discrimination against unemployed job applicants in job advertisements and postings. States such as Oregon and New Jersey have previously enacted laws that prohibit discrimination against the unemployed in job advertisements. As recently as March 27, 2012, the Governor of Oregon signed off on Senate Bill 1548. This new Oregon state law prohibits employers from including language in a job advertisement indicating that someone who is unemployed “should not apply” or “will not be considered” for the position.

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A Jury Duty Refresher and Warning

Posted on June 15, 2012 by smithamundsen

Contributed by Julie Proscia

Lesson number one:      Know the Federal and State rules regarding jury duty;

Lesson number two:      When a Judge sends you a letter do NOT throw it away.

In a recent turn of events a federal judge, Judge Holderman, appointed a lawyer to represent an employee that was terminated while serving jury duty in his court room. The employee was hired as a sales associate by HHGregg in August 2011. In January of 2012, the employee was called for jury duty by the federal district court for Northern Illinois. He was picked for the panel and notified his employer that the trial could last as long as 10 or 12 weeks.

The trial began on a Thursday, and the employee reported for work the following Saturday. On Saturday the employee informed his manager that he couldn’t meet his Sunday work schedule. Approximately two hours later, the manager called the employee into his office and fired him, allegedly stating that the employee was being terminated for not meeting his sales quotas. While the employee had previously received counseling regarding his low sales numbers, he had never been disciplined.

The employee notified Judge Holderman of the termination and his belief that the termination was related to jury duty. Lesson Number one: Know the law, under both the Federal and Illinois judicial systems, employees cannot be terminated or retaliated against for serving on a jury. Although there is no Federal or Illinois law that requires employers to pay non-exempt employees for their service, they cannot be retaliated against for being called or selected for service. Because the employee was called for federal jury duty, federal law applied. Under federal law, the presiding judge can investigate the termination to determine if the termination appears to have been based on the employee’s jury service; if the Judge finds “probable merit” that the termination was related to the service the Judge can appoint a lawyer to plead the juror’s case and initiate a lawsuit against the company. And this, my friends, is exactly what happened.

First, Judge Holderman sent correspondence to the HHGregg store management, requesting an explanation regarding the employee’s termination. No response was given. Lesson number two: Do not blow off the judge. When no response was given the court proceeded to investigate the matter. During the investigation Judge Holderman learned that virtually all the sales associates were still “on a draw” for potential commissions, many were failing to meet their quotas, and only one other associate had been disciplined, but not terminated, for low sales. This news likely did not endear the company to the court. Instead the problem was compounded when the court learned that the company has a policy that requires employees on jury duty to be paid minimum wage for the first 30 days and one-half minimum wage after that. This led to the belief that the employee was terminated to avoid the payment of wages and this belief resulted in the appointment of counsel and a result that will likely not be favorable for the company.

Moral of the lessons learned, know your state and federal jury duty laws, if you do not know them, call your labor and employment attorneys for advice prior to effectuating an adverse action. Terminations during jury service appear suspect; make sure you have a good trail to explain why the termination is based on a legitimate business reason. And if a Judge knocks on the door don’t hide behind the door and pretend that you are not home — it did not work when we were teenagers, it is not going to work now. 

In re Henders, N.D.Ill., No. 12-c-1147 (Feb. 17, 2012).

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NLRB’s Ambush (Quickie) Election Rule No Longer in Effect (for now…)

Posted on May 15, 2012 by smithamundsen

As we previously reported in our blog, the NLRB’s ambush (aka “quickie”) election rule went into effect on April 30, 2012.  The rule sought to dramatically shorten the time frame in which a union representation election will take place. In short, the rule limited the issues employers could raise in the pre-election process (i.e. determining which employees are considered supervisors, and which employees constitute an appropriate bargaining “unit” would no longer be permitted before the election took place) and significantly diminished employers’ ability to appeal unfavorable decision-making at the local board level. The net effect forced employers to counter union organizing campaigns in 14-21 days versus the previously set time frame of approximately 42 days. 

Yesterday, May 14, 2012, a U.S. District Court ruled that the NLRB’s Ambush Election Rule is invalid and no longer in effect because no proper quorum of members existed when the rule was voted on and passed.  U.S. Chamber of Commerce et. al. v. NLRB (D.C. Cir. 1:11-cv-02262). 

Effective immediately, NLRB election procedures revert back to how they had been prior to this April 30, 2012 rule making, which means employers can expect an approximate 42 day window before an election, as opposed to 14-21 days.  We expect the NLRB will likely appeal this decision. 

SmithAmundsen’s Labor & Employment Practice Group recently received one of the first quickie election petitions in the United States, and the new rule was indeed decidedly working against employers.  Unfortunately, this issue isn’t quite over… but this is a significant victory for employers who prefer to remain union free in whole or in part.  As always, more detail will follow as new developments arise.

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Fee Fi Fo Fum: CA Supreme Court Ruling Precludes Award of Attorneys’ Fees for Prevailing Party in Meal/Rest Break Claims

Posted on May 9, 2012 by smithamundsen

Contributed by Beverly Alfon

Last week, on the heels of the Brinker decision (which requires employers to make meal breaks available to their employees, without the burden of ensuring that employees take such breaks), the California Supreme Court ruled that a prevailing party cannot collect attorneys’ fees after winning a meal or break dispute under the California Labor Code. 

In Kirby v. Immoos Fire Protection, Inc., the defendant employer was the prevailing party on a claim for alleged violations of the Labor Code section 226.7, which governs employee rest breaks.  As the prevailing party, the employer sought to recover its attorneys’ fees under section  218.5 of the Labor Code, which provides for recovery of fees by “the prevailing party” in “any action brought for the nonpayment of wages, fringe benefits, or health and welfare or pension fund contributions.”  The trial court awarded attorneys’ fees to the employer.  The appellate court upheld the award of attorneys’ fees to the employer on the rest break claim.  However, the California Supreme Court reversed.

The court considered two questions: (i) whether meal/rest break claims fall within section 1194 (fee shifting provision) and, if not, (ii) whether section 218.5 authorizes an award for meal/rest break claims.  

  • The court determined that section 1194 did not apply because neither the text nor the history of section 1194 indicated that the statute is meant to refer to anything other than “ordinary minimum wage and overtime obligations” – which does not include meal/rest break claims.  It also reasoned that code section 1194 is one-way shifting provision that only provides recovery of attorneys’ fees to employees who prevail under that section. 
  • The court acknowledged that section 218.5 is a two-way fee shifting provision that allows an award of attorneys’ fees to any prevailing party.  However, it reasoned that the provision only applies to actions “brought for the nonpayment of wages, fringe benefits, or health and welfare or pension fund contributions” – not missed meal/rest breaks. 

Although the California Supreme Court’s ruling was negative for the employer in Kirby, the up-side is that this decision eliminates the potential for an award of attorneys’ fees under the Labor Code, which is often used as an incentive for plaintiffs’ attorneys with respect to meal and rest break claims.

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Horseplay In The Workforce Ain’t What It Used To Be And It Could End Up Costing You Big Bucks!

Posted on February 29, 2012 by smithamundsen

Contributed by Heather Bailey

A Louisiana jury was correct when it found that a survey crew instrument man at an engineering firm was sexually harassed by his supervisor’s boss who happened to be a male as well.  Cherry v. Shaw Coastal, Inc., 5th Cir., No. 11-30403, 1/19/12.  The harasser started off by brushing the employee’s hair, then he would ask the employee to take his shirt off and to wear revealing clothing.  The behavior escalated to inappropriate sexual text messages, repeated touching of the body and hair, and an invitation to sleep over and wear his underwear.  There was one occasion where the harasser touched the employee on the buttocks.  During this time, the employee repeatedly told the manager that he was uncomfortable and that the manager should keep his comments to himself.  

The employee’s supervisor knew his boss was acting inappropriately and complained twice to two different managers who were overseeing the project they were all working on together.  Nothing was done and the managers never informed human resources of the complaints.  After the third compliant when the employee finally complained to the same management team, the manager questioned that the harasser’s conduct was probably just “horsing around.”  After yet another complaint, management finally removed the employees from working on the same crew.  However, the harasser was still able to make the employee feel uncomfortable so he escalated his complaint.  Finally, management informed human resources, but not before questioning the conduct was just “horsing around” again.

Human resources conducted an investigation yet concluded the issue was one word against the other and took no further action.  Again, the company took no further action when the employee complained the harasser was then retaliating against him for complaining.  The employee then resigned because the company failed to take any action and he could no longer take the harasser’s treatment.

The court said the jury was right that there was same-sex harassment here based upon the manager’s vulgar sexual text messages which propositioned the employee, an offer to stay at his house and wear his underwear, and the repeated offensive physical touching and caressing which included a single instance on the buttock.  The court said all of this conduct was “severe and pervasive,” which is a test for proving sexual harassment.  

The lesson learned here is that the company was liable due to its failure to take prompt remedial action. It had a policy that required management to report any complaint to human resources, but management didn’t follow that policy here and even suggested that the inappropriate conduct was just horseplay.  When management finally followed the policy, human resources – despite having documented proof and a superior as an eye witness — did nothing. 

Spring Cleaning Tips: 

  • Update the company’s Anti-Harassment and Discrimination Policies, and if you don’t have one to update, create one immediately!
  • Train all employees on the do’s and don’t’s of sexual harassment and discrimination, including management on what to do when an employee complains or when management sees inappropriate conduct taking place. 
  • Review the company’s complaint and investigation procedures to ensure complaints are taken seriously and investigations are conducted effectively with a focus of remedial action when necessary.

We recommend you contact your employment counsel to ensure your policies and practices are tuned up.

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