Category Archives: employer liability

BREAKING NEWS: Illinois Recreational Cannabis Law Protections for Employers & the Workplace Clarified!

Contributed by Jeffrey A. Risch, November 15, 2019As Illinois set out to become the first state to legalize recreational cannabis through statutory authority, the legislative intent for protections for employers and the workplace were intended to include some of the strongest in the nation. However, when the dust settled and the statutory framework was analyzed, there appeared to be room for reasonable minds to have differing opinions on what the law actually meant for the workplace.

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On one hand, could employers lawfully implement reasonable, non-discriminatory drug testing policies aimed at prohibiting applicants and employees from lawfully using recreational cannabis and gaining or maintaining employment? On the other hand, would employers be violating the law if they did not hire someone who tested positive for THC or if they could not ultimately demonstrate that an employee was actually impaired while on the job? These sorts of questions lingered. A quick online search trying to find answers would only frustrate HR professionals, safety managers, and business owners further. Clarity was needed.Therefore, through the efforts of several business groups and trade associations (including the Illinois Chamber of Commerce) working across both political aisles, SB1557 passed the Illinois General Assembly on November 14, 2019. While SB1557 includes wrinkles for the licensing, manufacturing and distribution of recreational cannabis in Illinois, it also contains language found below designed to protect employers from litigation.In essence, the language attempts to clear up concern that an employer may have been required to show actual impairment in the workplace vs. simply being able to implement and follow a reasonable, non-discriminatory drug testing policy.   Specifically, Section 10-50 of the law will now read as follows (changes in bold):

(410 ILCS 705/10-50) Sec. 10-50. Employment; employer liability.(a) Nothing in this Act shall prohibit an employer from adopting reasonable zero tolerance or drug free workplace policies, or employment policies concerning drug testing, smoking, consumption, storage, or use of cannabis in the workplace or while on call provided that the policy is applied in a nondiscriminatory manner.(b) Nothing in this Act shall require an employer to permit an employee to be under the influence of or use cannabis in the employer’s workplace or while performing the employee’s job duties or while on call.(c) Nothing in this Act shall limit or prevent an employer from disciplining an employee or terminating employment of an employee for violating an employer’s employment policies or workplace drug policy.(d) An employer may consider an employee to be impaired or under the influence of cannabis if the employer has a good faith belief that an employee manifests specific, articulable symptoms while working that decrease or lessen the employee’s performance of the duties or tasks of the employee’s job position, including symptoms of the employee’s speech, physical dexterity, agility, coordination, demeanor, irrational or unusual behavior, or negligence or carelessness in operating equipment or machinery; disregard for the safety of the employee or others, or involvement in any accident that results in serious damage to equipment or property; disruption of a production or manufacturing process; or carelessness that results in any injury to the employee or others. If an employer elects to discipline an employee on the basis that the employee is under the influence or impaired by cannabis, the employer must afford the employee a reasonable opportunity to contest the basis of the determination.(e) Nothing in this Act shall be construed to create or imply a cause of action for any person against an employer for:

  1. actions taken pursuant to an employer’s reasonable workplace drug policy, including but not limited to subjecting an employee or applicant to reasonable drug and alcohol testing, reasonable and nondiscriminatory random drug testing, and discipline, termination of employment, or withdrawal of a job offer due to a failure of a drug test; , including but not limited to subjecting an employee or applicant to reasonable drug and alcohol testing under the employer’s workplace drug policy, including an employee’s refusal to be tested or to cooperate in testing procedures or disciplining or termination of employment;actions based on the employer’s good faith belief that an employee used or possessed cannabis in the employer’s workplace or while performing the employee’s job duties or while on call in violation of the employer’s employment policies;actions, including discipline or termination of employment, based on the employer’s good faith belief that an employee was impaired as a result of the use of cannabis, or under the influence of cannabis, while at the employer’s workplace or while performing the employee’s job duties or while on call in violation of the employer’s workplace drug policy; orinjury, loss, or liability to a third party if the employer neither knew nor had reason to know that the employee was impaired.

(f) Nothing in this Act shall be construed to enhance or diminish protections afforded by any other law, including but not limited to the Compassionate Use of Medical Cannabis Pilot Program Act or the Opioid Alternative Pilot Program.(g) Nothing in this Act shall be construed to interfere with any federal, state, or local restrictions on employment including, but not limited to, the United States Department of Transportation regulation 49 CFR 40.151(e) or impact an employer’s ability to comply with federal or state law or cause it to lose a federal or state contract or funding.(h) As used in this Section, “workplace” means the employer’s premises, including any building, real property, and parking area under the control of the employer or area used by an employee while in the performance of the employee’s job duties, and vehicles, whether leased, rented, or owned. “Workplace” may be further defined by the employer’s written employment policy, provided that the policy is consistent with this Section.(i) For purposes of this Section, an employee is deemed “on call” when such employee is scheduled with at least 24 hours’ notice by his or her employer to be on standby or otherwise responsible for performing tasks related to his or her employment either at the employer’s premises or other previously designated location by his or her employer or supervisor to perform a work-related task.

Additionally, much needed clarification for public employers was also included concerning how off duty use of cannabis by certain emergency personnel should be administered. The following was added to Section 10-35. Limitations and penalties:

(410 ILCS 705/10-35)(8) the use of cannabis by a law enforcement officer, corrections officer, probation officer, or firefighter while on duty; nothing in this Act prevents a public employer of law enforcement officers, corrections officers, probation officers, paramedics, or firefighters from prohibiting or taking disciplinary action for the consumption, possession, sales, purchase, or delivery of cannabis or cannabis-infused substances while on or off duty, unless provided for in the employer’s policies. However, an employer may not take adverse employment action against an employee based solely on the lawful possession or consumption of cannabis or cannabis-infused substances by members of the employee’s household. To the extent that this Section conflicts with any applicable collective bargaining agreement, the provisions of the collective bargaining agreement shall prevail. Further, nothing in this Act shall be construed to limit in any way the right to collectively bargain over the subject matters contained in this Act;

These changes help to better assure employers that they have the ability to implement fair, reasonable drug testing policies designed to protect their employees and the public. Recreational consumers will certainly have the legal right to use cannabis, but the employer should have the legal right to say “you better not have THC in your system to become or remain employed here.” Of course, any drug testing policy must be carefully vetted, designed, and implemented. After all, lawyers will be lawyers. 

While many questions still remain and medicinal usage requires a different analysis (for now) it appears employers can take better comfort and be more confident in creating policy designed to maintain a safe and healthy workplace through reasonable drug testing policies. However, employers must continue to carefully examine their own unique industry, risks and risk tolerances, together with their geographic footprint and applicant pool. The drug testing policy and drug-free workplace program for the “widget manufacturer” in Peoria is likely to be vastly different than that of the “accounting firm” in Schaumburg.

Seventh Circuit Opinion Focuses on Employee Handbook in Determining Whether Employer had Constructive Notice of Non-Supervisory Sexual Harassment

Contributed by Allison P. Sues, August 22, 2017

Employee handbookOn August 2, 2017, the United States Court of Appeals for the Seventh Circuit issued a decision in Nischan v. Stratosphere Quality, LLC providing clarity on what constitutes an employer’s “constructive notice” of harassment.

Michele Nischan worked as a project supervisor at Stratosphere Quality, LLC, a company that provides third-party inspection and quality-control services to car manufacturers. Nischan alleged that an employee of one of the client manufacturers “relentlessly” sexually harassed her by routinely rubbing himself against her and making offensive comments, amid other inappropriate actions.

Because the alleged harasser did not have supervisory authority over Nischan, Stratosphere could only be held liable for the alleged sexual harassment if it was negligent in discovering or remedying it. Normally, to prevail on this type of claim, the employee presents evidence that she made a concerted effort to report the harassment. Here however, it was undisputed that Nischan did not report the harassment during the relevant time period.

Nevertheless, an employer may be held liable even when an employee fails to report sexual harassment if the employer knew or should have known of the harassing conduct but failed to act. The Federal Appellate Court explained that constructive notice will generally attach when someone who has a duty to pass the information up the chain of command learns of the harassment.

Nischan claimed a fellow project supervisor (her peer) and an operations manager were both present when one of the incidents of harassment occurred. However she testified she was unsure whether the operations manager witnessed the harassment and he denied witnessing any conduct that constituted sexual harassment.  The lower court concluded there was no basis to impute liability to the employer because only her peer, not the higher level employee, knew of the harassment.

The Seventh Circuit disagreed.  Even though the project supervisor who witnessed the harassment held the same low level project supervisor position as Nischan and was not Nischan’s supervisor, the employer’s handbook required that any employee with any supervisory responsibility report observed instances of harassment up the chain of command or to human resources. The Seventh Circuit noted that the employer “is accountable to the standard of care it created for itself” and that because the employer’s own rules “required [the project supervisor] to report the sexual harassment that she observed, Stratosphere had constructive notice of the harassment.”

Bottom Line: This case serves as a reminder that each company’s unique employee policy may guide the court in determining an employer’s legal obligations. Employers should review their harassment and reporting policies and ensure that all employees that fall under its scope receive proper training on identifying harassing behavior—even if it is directed at another—and promptly reporting it.

Responding to Violence in the Workplace – A “Catch 22” for Employers

Contributed by Michael Wong, August 10, 2017

Workplace investigation

The recent instances of violence in the workplace remind us of the complex task facing employers. Employers must maintain a safe work environment for employees while operating within the parameters of the many federal and state laws that may protect certain employee conduct. More importantly, because an employer has no objective “litmus test” for predicting which employee may become violent under particular triggering circumstances, there is no foolproof way to effectively eliminate the hazard.

Employers today can find themselves in a seemingly untenable dilemma when they have violence threaten to invade their workplace, as disciplining or terminating the problem employee can result in a legal claim as well.

In Mayo v. PCC Structurals, Inc., 795 F.3d 941, 942 (9th Cir. 2015), the employer, PCC, terminated the plaintiff, Thomas Mayo, after he made threatening comments to three co-workers that he was going to bring a gun to work and start “shooting people.” After the threats were reported, the employer took the proper precautions by immediately suspending the plaintiff, barring him from company property, and notifying the police. The police took him to the hospital for medical treatment on the basis that he was an imminent threat to himself and others.

After taking three months of leave under the FMLA and Oregon’s equivalent state law, a treating psychologist cleared Mayo to return to work, but recommended a new supervisor assignment. Instead, the employer terminated Mayo. Plaintiff then sued PCC alleging he was terminated because of his disability in violation of the Americans with Disabilities Act (ADA) and state law.

In Mayo v. PCC, the United States Court of Appeals for the Ninth Circuit held that an employee who made serious and credible threats of violence against coworkers is not a qualified individual with a disability under the ADA or Oregon’s disability discriminatory law. In granting summary judgment to the employer, the Court held that an essential function of almost every job is the ability to appropriately handle stress and interact with others, and that an individual is not qualified and cannot perform the essential functions of the job if he or she threatens to kill co-workers – regardless of whether such threats stem from a mental condition or disability.

What should employers do?

Against this potential liability minefield, an employer should develop an effective written workplace violence preventative policy. For those who already have policies in place, it would be a good idea to review your policies and practices with your legal counsel to make sure that these issues and any potential concerns are properly addressed.

Ask yourself the following questions to see if your policy needs to be modified in light of the recent lawsuits:

  1. Do your policies advise employees that they will be subject to discipline (up to and including termination) if they “fail to foster collegiality, harmony, positive attitude, and good relations in the workplace?”
  2. Do you have a statement that there is “zero tolerance” regarding threats or acts of violence?
  3. Do your managers/supervisors know what steps should be taken if there is a threat, complaint of bullying or violence?
  4. Have your managers, supervisors and employees been trained on identifying signs and symptoms of behavior which may predict potential violence (erratic behavior; comments regarding violence, homicide or suicide; provocative communications; disobedience of policies and procedures; presence of alcohol, drugs or weapons on the worksite; evidence of violent tendencies or abuse of alcohol or drug use)?
  5. Have your managers and supervisors been trained and regularly reminded about the importance of good documentation and dangers of bad documentation?

Employer May Be Held Liable For Employing Murderer!

Contributed by Noah A. Frank, July 27, 2017

Claims of negligent hiring, training, and retention is alive and well. Employers must be prepared to investigate, and fully remediate supervisors’ misconduct.

code of conduct

Recently, the Seventh Circuit Court of Appeals (Illinois, Wisconsin, Indiana) held that an employer may be liable for intentional acts committed by supervisory employees against other employees outside of work if the employer has been negligent. The tragic case, Anicich v. Home Depot USA, Inc., 852 F. 3d 643 (7th Cir. 2017), arose from the death and rape of a pregnant employee at the hands of her supervisor.

Background

Home Depot and its garden centers subcontractors (together, the “Employer”) jointly employed Brian Cooper as a regional manager. The victim’s estate alleged the employer knew Cooper had a history of sexually harassing, verbally abusing, and physically intimidating female subordinates, which included making crude and lewd comments, yelling and swearing at them, rubbing against them, controlling their conduct by pressuring them into spending time with him alone, and even throwing things.

The supervisor’s mistreatment of one subordinate, Alisha Bromfield, began in 2006 when she started working for the employer seasonally as a teenager. Cooper fixated his attention on her, calling her his “girlfriend” at work and repeating the above misconduct with her. Senior management, aware of Bromfield’s repeated complaints, failed to take reasonable steps to protect Bromfield, ensure that Cooper completed mandated anger management training or remove his supervisory duties. This ended in tragedy.

In 2012, when Bromfield was 7 months pregnant, Cooper threatened her. Using his supervisory authority, he demanded that she attend an out-of-town wedding with him, telling her he would fire her or reduce her hours if she refused. Bromfield acquiesced, but denied Cooper’s recurring demand to “be in a relationship.” After the wedding, Cooper murdered Bromfield, and then raped her corpse.

The Court held that employers have a duty to act reasonably in hiring, supervising, and retaining their employees, and that this was part of a broader trend toward recognizing employer liability for supervisors’ intentional torts committed outside the scope of employment – even where the harm caused was wholly disproportionate to more predictable harms (e.g., murder/rape versus continued sexual harassment, emotional/mental trauma). Because Cooper was alleged to have abused the employer’s grant of supervisory authority over Bromfield, the employer could be vicariously liable for Cooper’s torts committed against Bromfield.

Employers’ Duty in Light of the Seventh Circuit Court Ruling

Anicich is instructive. Employers that fail to act to stop an employee’s abuse of supervisory authority could be held liable for even the most extreme and gruesome intentional tortious and criminal conduct.

As such, employers must protect their businesses, including the following minimum steps:

  • Understand the risks associated with subcontracting and joint employer relationships, including supervision and control;
  • Implement and train employees on anti-discrimination, harassment, and sexual harassment policies, including a published complaint/reporting procedure, and prohibiting retaliation;
  • Take seriously and investigate all reports and complaints – no matter how minor, and even for repeat complainants;
  • Remediate any issues – including stripping supervisory authority, mandating training, and transferring/terminating employees;
  • Prohibit and protect those involved from, retaliation;
  • Respect and comply with collective bargaining rights – and get the union’s buy-in when necessary; and
  • Seek the advice of and guidance from experienced employment counsel when issues arise to ensure legal compliance and implementation of best practices to mitigate exposure.

Document, Document, Document – A Mantra Revisited

Contributed by Carlos Arévalo

Failure to document performance or conduct problems is a common mistake employers make. Typically, employee handbooks contain provisions requiring periodic performance reviews.  Similarly, handbooks contain discipline provisions that include procedures dealing with the issuance of warnings related to the violation of work rules.  How employers use and apply these provisions can make the difference in successfully defending claims.

A recent decision out of the United States Court of Appeals for the District of Columbia illustrates how critical it is to properly document an employee’s behavior and performance issues. This decision also underscores the importance of making sure that the reasons for termination are clearly and consistently stated throughout the life of a claim. In Giles v. Transit Employees Federal Credit Union, 2015 WL 4217787 (July 14, 2015), an employee suffering from multiple sclerosis (MS) sued her former employer alleging wrongful termination in violation of the American with Disabilities Act (ADA) and the Employee Retirement Income Security Act (ERISA).

Prior to her termination, the employee was involved in a couple of altercations with customers. In one instance, the employee was engaged in an argument with a customer over a pen. The employee was given a verbal warning.  On another occasion, the employee improperly confronted a customer for entering the building through the wrong door. In response, the employee was issued a written warning with a two day suspension. The employee was then assigned to a different position. As for performance, the employee was given a combination of satisfactory and poor ratings in the two positions she held. When a leadership change occurred, the new CEO terminated the employee.

Because premiums for the health insurance plan increased 57% over a period of two years during her tenure, the employee sued claiming that the cost of treating her MS caused premiums to increase and that she was dismissed to reduce the employer’s health care costs. As the employee’s case moved from administrative proceedings before the EEOC to the action in district court, the employee also attacked the employer’s “shifting and inconsistent justifications for her termination.” Initially, the employer stated that the employee was terminated based on the employee’s performance ratings and her altercations with customers. Later, her termination was the result of a “general organizational review” made for “business reasons.” Finally, the employer reverted to poor performance and added that substandard employees were being eliminated as part of a business strategy to cut costs and restore profitability. Fortunately for the employer, the appellate court affirmed the trial court’s finding of summary judgment in favor of the employer because there was no evidence supporting a claim that the cost of insuring plaintiff was a motivating factor in the termination decision. However, inconsistencies or shifting justifications for employment action often give employees a successful argument that the reasons given for termination were pretextual in nature.

Here are five simple and practical lessons from the Giles case:

  1. Behavior issues should always be documented, even if they only involve a verbal warning.
  2. Periodic reviews should clearly identify any deficiencies in employee performance.
  3. The basis of a termination decision should be clearly stated to the employee.
  4. Employee files should be clear and concise so even a change in management will not affect employment decisions.
  5. The basis of the termination decision should be consistent – shifting reasons may impact the outcome of litigation.

Who Knew? Even the Boss Can Be Sexually Harassed

Contributed by Jamie Kauther

Although not prevalent, and seemingly counterintuitive, some federal courts have recently addressed the issue of subordinate sexual harassment of their supervisors. This conundrum is especially interesting as employer liability is usually determined by the status of the harasser, including a subordinate, co-worker, or supervisor of the victim. Under Illinois law there is strict liability for employers when the harasser is a supervisor of the victim – i.e., there are no defenses available to an employer if sexual harassment is shown.

Under both state and federal law, Illinois employers are liable for sexual harassment by a victim’s co-worker when they (1) knew or should have known of the offensive behavior; and (2) failed to take immediate and appropriate corrective action. Under federal and most state laws, except Illinois which is strict liability, an employer is automatically liable for sexual harassment by a supervisor against a subordinate unless it can show that (1) it reasonably acted to prevent and to correct harassing behavior; and (2) the harassed employee unreasonably failed to take advantage of the employer’s preventive and corrective actions or otherwise failed to avoid harm. Presently it is unclear what standard applies when the victim is the supervisor.

This issue was addressed on July 20, 2015 in Simmons v. DNC Hospital Management of Oklahoma, LLC, 2015 WL 4430967, wherein the court denied summary judgment for the employer on the employee’s claimed sexual harassment at the hands of her subordinate. The court explained the employer essentially forced the employee to quit through its failure to remedy the complained of harassment. The Simmons case serves as a stark reminder that even when a supervisor is complaining of harassment by a subordinate, the employer still has a duty to stop the harassment regardless of what action the victim could have taken herself.

Further, courts across the country have started adopting standards to apply in supervisor-victim instances. Some recent court decisions have adopted a hybrid standard that meets in the middle between the reasonableness standard applied to co-worker harassment and the much higher burden imposed on supervisor harassment. This standard is as follows:

An employer may be held liable for the harassment of a supervisor by a subordinate if the employer knew or should have known of the harassment and failed to implement prompt and appropriate action; but an employer will not be liable for the sexual harassment of a supervisor by a subordinate where the supervisor-plaintiff had the ability to stop the harassment and failed to do so. 

Knudsen v. Bd. of Sup’rs of Univ. of Louisiana Sys., 2015 WL 1757695, at *5 (E.D. La. Apr. 16, 2015)

Although this is a “unique fact twist” on the sexual harassment theory, it is one that has gained traction with federal courts recently. What is important to note is that NO court has held that an employer is not liable for subordinate harassment of a supervisor. As such, although the area is still in development, employers should start incorporating this situation into their training and ensuring that all supervisors are aware that the employer’s harassment policies apply to these situations as well. Only proactive prevention, training, and correction will protect against costly litigation.