Thursday, November 21, 2013

But I Digress

I am a huge pizza lover, so every now and then you can expect me to wander off into flatbread land. As in today.

This product is so technologically over the top and unnecessary it just screams "frivolous Christmas/holiday/Hanukkah present."  For those of us who make our pizzas from scratch, this is the new pizza cutter standard.

Monday, November 18, 2013

Drug Use Declines for US Workers

At least for the illegal stuff. Prescription drug abuse is up, however. Maybe this is one of the side effects of increasing access to health insurance.

And let's not forget those states--Illinois just joined this group--where medical marijuana has been licensed.  My experience in Colorado is that legalization of medical marijuana leads to a large increase in the number of people suffering from pain that can only be "managed" with cannabis. Fortunately, employers in states where marijuana has been legalized in one form or another may still discipline employees who show up with dope at detectable levels in their blood or urine.  But as the article notes, the landscape for disciplining employees for off-work marijuana use is changing, as the recreational possession laws start to take effect.

And, of course, there is still the significant conflict between state law that legalizes possession and use of small amounts of marijuana, and federal law, which strictly prohibits any use or possession of the drug.  So if you want to smoke dope in Colorado (which recently legalized recreational dope use), stay unimpaired long enough to make sure you're doing so in a state park, and not on a federal national forest or park.

Some thoughts on the NFL and harassment in the workplace

It's an unfortunate truth that pro sports management often seems to operate as if athletic teams were somehow separate and apart from the rest of the American employment world.  Specifically, many professional sports management personnel, especially coaches, are blissfully unaware of the legal standards that apply to their players, other than those covered by the collective bargaining agreement. There has been some progress--many teams had no concept or even awareness that workers compensation laws applied to on-the-field football injuries for their players. Thankfully, that situation is pretty much a thing of the past, but you still encounter circumstances today in which conduct that is basically unthinkable in a normal workplace is either ignored or even encouraged in a football or basketball locker room.

Thus the Richie Incognito/Jonathan Martin situation with the Miami Dolphins. I want to first talk about the legal implications of the situation, and then a more general assessment of what reportedly happened, and what it means for professional sports in general.

Martin, an offensive tackle, left the Dolphins facility without notice to management, allegedly because he was being harassed by his teammates, and one teammate in particular, Richie Incognito, who played next to Martin on the offensive line. Prior to leaving, Martin tried to raise his concerns about harassment with team management, either personally, or through his agent. Martin apparently never talked to any of his teammates about harassment, nor did he raise it with his immediate supervisors, the coaches. Martin's attorney has produced texts and a voicemail message containing at least one racial epithet, and threatening language against Martin, and his sister.

Over the last several weeks, Incognito's version of events came out, either through statements by Incognito himself, or by statements from his teammates. These statements do not paint a picture of harassment, but rather seem to indicate that Incognito and Martin were fairly close, at least in terms of their public associations, and that the racial comments and personal threats, which Martin acknowledged to other players in the locker room and actually laughed about, were part of an ongoing joking or lighthearted taunting that permeated the locker room.

From a purely workplace law perspective, I'm guessing that Martin will have a very difficult time establishing any type of employment discrimination or employment harassment. The language used in the e-mails and voicemails is certainly awful from an objective standpoint-dropping the N-bomb on a black teammate, threatening to sexually assault his sister, or inflict bodily harm on him are not the type of activities that make the HR "Best Practices Handbook".   But all harassment cases have a subjective element as well, in that the conduct must be "unwelcome" to the victim. And that's where Martin's problems begin, because it seems readily apparent that he was at least acquiescing, if not participating in the harassment Olympics that took place in the Miami locker room.  Based on comments to date, in fact, I fully expect every black member of the Dolphins to stand up and testify that they were not offended by Incognito, and that Martin wasn't either. So much for the racial harassment claim.  Incognito may have been bullying Martin and being mean to him, but unless he was doing it because Martin was black (or because of some other protected factor we are unaware of), it simply isn't actionable.

There are some allegations that Martin or his agent complained to Dolphin management about this treatment. When that happened, and what happened after the alleged complaints, could form the basis for a viable retaliation claim, if Martin can show that club management not only knew about his complaints, but acted in response to them. Again, I think this will be a very difficult thing to prove. There is some evidence that the coaching staff wanted Martin's teammates to interact with him in a way that would draw him out, or at least get him more emotionally committed to the team. But that's a far cry from that same coaching staff being aware that Martin had complained that he was being racially harassed (if Martin even did that) and responded by having his teammates berate and humiliate him.  And if the Dolphins can show that the coaches were directing Martin's teammates to toughen Martin up before Martin complained, then this claim gets even weaker.

But this case has some wider implications for all pro sports, depending on how the NFL and other sports teams react to it.  Locker rooms are not your typical workplaces, and there are some rules that work just fine in a white collar /office environment that simply don't in a locker room.  This isn't surprising, or even that unusual.  Courts have routinely recognized that all-male working environments, or even jobs requiring difficult physical labor, are normally associated with bad language, obscene rituals, and general juvenile conduct.  It was not coincidental that the Supreme Court said that Title VII is not a civility code in reference to a case involving people working on an oil rig.

But being merely legal is not enough.  These teams are involved in the entertainment business, and the public perception of their organizations is a key element in their profitability.  Public sentiment for organizations perceived as being full of bullies and bad guys is hard to sustain.  So some teams have immediately reacted by banning any conduct that might be considered hazing, and I think more will follow suit.  But I also think that no matter what clubs try to do, there's going to be some type of harassment of new players, and low level taunting/torment of teammates, just because that's been part of sports and elite organizations since the Greeks organized the Olympics two thousand years ago.  Moreover, it's hard to isolate the intimidation that is part of football (it's part of all sports, actually) to just the opponent on the playing field.

Will the public understand?  I suspect it will, although I think this case has been badly reported by the mainstream sports media, who, after all, labor in environments where this type of conduct is relatively foreign, and certainly actionable.  As far as I can tell, the only really accurate discussions of what happens in a typical locker room are coming from former players, and, to a certain extent, some of the coaches who now work in the broadcast booth.  I think as both sides of the story get out into the press, we will see that what happened with Martin was not an isolated issue of bullying/racism, but rather conduct that is typical in locker rooms from high school forward, and that Martin at least seemed to go along with what was happening to him.  That might be enough to work an organizational change for some teams with respect to player conduct, but I doubt that it will sustain any type of legal challenge.

Friday, October 25, 2013

A Cheap Shot at Injured Professional Athletes

One thing I can say for California political leadership-it knows on which side its bread is buttered. Employees (i.e. voters, who outnumber manager voters by a considerable margin) have one of the most friendly legal environments in the country as result of California political largess. But the entertainment industry, long a source of California revenue, prestige, and political donations, has usually enjoyed a privileged spot with respect to California labor laws, employment rules, and the like.

And by entertainment industry, I'm including the National Football League, and professional sports teams generally. California has three NFL teams, four NBA teams, three NHL clubs, and five Major League Baseball teams. And that doesn't even include USC with its questionable amateur athletes.  Professional sports puts up a lot of ticket sales, television revenue, parking, and a much high-powered athletic talent to show up at your party, fundraiser, and film premiere. So it's perhaps not too surprising that the state recently modified its workers compensation law, one of the most generous in the nation, to cut off claims from retired athletes who did not work for California-based teams, but played some of their games in California. Specifically, because California's liberal standard allows workers to get compensation for accumulated trauma (that is, injuries that resulted from repetitive stress or impacts over a long period), approximately 4500 NFL players who played games in the state are filing claims for workers compensation under California law.

Now the state of California is not on the hook for these claims-they revert back to the individual workers compensation insurance carried by the various teams. But California law allows an avenue for injury compensation that is not available in many states, and so players who could not get compensated in their states of employment are filing in California (here are links to claims from the various pro sports leagues filed in California). Under heavy pressure from the major sports leagues, but particularly the NFL (which sees the repetitive brain injury issue looming large), the legislature and the governor passed a law closing out the ability of these players to file for compensation.

I find this highly troubling-this is not a situation where uninjured players are scamming the workers compensation system for money that is undeserved (California has a long history of this type of problem). Virtually all of these individuals are suffering the effects of athletic injuries that did not manifest themselves until years after their playing careers ended. This is precisely why states enacted workers compensation systems, and I think it's highly dishonest of the NFL, and of California political leadership, to cut off a perfectly ordinary and proper vehicle for these gentlemen to be compensated for their injuries.

UPDATE:  Remember when I said that California has a history of people filing undeserved workers compensation claims? Here is a somewhat sarcastic take on a classic example.

Thursday, October 24, 2013

An Employer Created Disability, or, The Self Licking Ice Cream Cone

A case out of South Dakota shows how encompassing the Americans with Disabilities Act has become under the new amendments. Specifically, this case is an example of an employer using its progressive discipline policy and actually creating a disability that it is then charged with accommodating.

The plaintiff, a K-12 art teacher, was assigned additional duties teaching a remedial class for which she did not feel qualified. After she complained, the school district began monitoring her teaching performance and identified areas of concern where her supervisor expected performance improvement. Her supervisor routinely monitored her classes and placed her on a formal “plan of assistance” requiring her to improve performance in certain areas  by a specific deadline.

Allegedly as a result of this supervision, plaintiff developed anxiety symptoms, depression, weight loss, and sleep pattern deficits. The plaintiff’s physician sent a letter to the school administration requesting some 13 changes in her work environment, including cutting off the observations of her classes, having an “impartial” representative at any meeting that she had with her supervisor, tentative breaks whenever the plaintiff felt necessary and providing coverage available at no notice so that plaintiff could leave whenever she felt overwhelmed by her work environment. The school district responded with a letter agreeing to provide some of these accommodations rejecting some and requesting clarification. The parties exchanged letters again regarding clarification on the accommodations, but the matter went no further after the district's last letter went unanswered. Ultimately, the school district failed to renew the plaintiff’s contract. She had taken a medical leave of absence several months earlier.

The district court determined that plaintiff had a disability given the physical and psychological reaction she had to the employer's progressive discipline system. The court then determined that the school district, although it had some interaction with plaintiff, did not make  a "good faith" effort to resolve plaintiff’s request for an accommodation. The facts on this are, quite frankly, disturbing for employers. Plaintiff specifically failed to respond to the school district’s last letter, and the school district argued that plaintiff simply shut down the discussion, obviating any finding of liability on the part of the school district. But the court noted that the school district, via plaintiff’s supervisor, advised her at almost the same time it sent the last letter that it was recommending that her contract not be renewed. Given that this recommendation was pending, and plaintiff knew about it, the court surmised that plaintiff and a jury could conclude that this school district was not acting in good faith.

The court leaves a lot out of its discussion  - I suggest that the nonrenewal letter timing was mandated by district procedures and that it could not have provided a basis for a reasonable plaintiff to refuse to participate in the interactive process any further.  There was a full school board hearing that had to take place before plaintiff's contract could be terminated, so the non-renewal letter was more of a preliminary procedural step rather than a final adjudication.  But all this was lost on the court.

So what this case stands for is that an employer can undertake a good faith disciplinary process, and find itself saddled with an ADA claim as a result of its efforts, and then have the plaintiff unilaterally close off the interactive process as the employer moves through its disciplinary process requirements. I would think at some point that the plaintiff has to bear some responsibility for keeping her job. For whatever reason, the South Dakota court skewed what should have been a fairly straightforward determination far too much in the Plaintiff’s direction and favor.

Wednesday, October 23, 2013

5th Circuit Notes Title VII is Not a Civility Code, and Then Decides It Is

A recent same sex sexual harassment case out of the 5th Circuit potentially opens the door for a significant expansion of what constitutes a hostile work environment under federal law.

In terms of parsing federal court decisions, any time you see federal judges start off by quoting the Supreme Court’s aphorism that Title VII is not a general civility code for the work place, you should be suspicious that they are about to  enforce Title VII as if it is a general civility code for the work place. That is precisely what happened here. The plaintiff was an iron worker who, by virtue of several comments during a lunch discussion about using baby wipes instead of toilet paper (I guess I really didn't know what iron workers talk about at meal times), was thought to be not quite masculine enough for his supervisor. As a result of this, the plaintiff suffered a fair amount of derisive and personal comments while at work, although none related to baby wipes specifically. He complained, filed a charge of discrimination, and went to trial. The jury believed his harassment claims, but the 5th Circuit Court of Appeals on its first review reversed the jury, determining that there was not enough evidence to support a verdict of sexual harassment. The EEOC, which was prosecuting the case on behalf of the plaintiff, appealed for a full 5th Circuit review.

In the full review, the Court started off by quoting the only same sex sexual harassment case to be decided by the Supreme Court, Oncale, and noting that Title VII is not a statute designed to enforce civil speech codes in the work place. The Court then noted that gender stereotyping (i.e., discriminating against someone because they do not meet the stereotypical behavior associated with a particular gender) is a valid basis for a sexual harassment/hostile work environment claim. So far, so good, this stuff is pretty well established law.

The Court noted initially that the allegations of conduct by the plaintiff – almost daily put downs and occasional physical demonstrations relating to homosexual or feminine characteristics– were enough to establish a hostile work environment. The Court then took on the company’s failure to establish the affirmative defenses to a sexual harassment case allowed by the Supreme Court’s decisions in Farragher and  Ellerth. The Court determined that the company had not undertaken a comprehensive training of its supervisors on sexual harassment, nor had it done a good job of putting the word out for its work force on how to properly report harassment to the company’s HR staff. Moreover, the company’s investigation of Plaintiff’s initial allegations was not terribly effective – the investigation was a 20 minute interview with the plaintiff resulting in him being sent home with no pay for 3 days. There was no disciplinary action against the alleged harasser, although it was clear that some improper conduct had occurred. In short, the Court found that there was both a failure to put into play proper prevention steps, and a failure to follow up on plaintiff’s allegations, both of which effectively denied the employer the ability to use the affirmative defense.

The real meat of the case is found in the surprisingly long and detailed dissent, most of which focused on a  fairly straight forward point – that the EEOC had no evidence to infer discriminatory intent based on gender. The dissenting judges keyed on a subtle aspect of the Supreme Court’s decision in Oncale – that the normal practice of inferring gender animus in male-female sexual harassment claims applies to same sex sexual harassment claims only if an additional step is taken to demonstrate that the basis of the inference is gender. In same sex harassment cases, in other words, a plaintiff must prove that the harassment is because of sex, the motivation is not assumed as it is in opposite gender cases.

The dissent noted that the only basis for establishing that the supervisor felt the plaintiff was not manly enough was the fact that he used baby wipes in lieu of toilet paper and this didn't fit a stereotype. There was no other evidence to show that anyone felt that Plaintiff was being singled out because he was a man, as opposed to being an iron worker just like the rest of them. In fact the supervisor testified specifically that he did not consider the Plaintiff unmanly.  The plaintiff  himself did not testify that he was being treated the way he was because he was not “manly.”

Moreover, there was no evidence that the plaintiff did not act in a masculine way. The dissent stated that without some objective evidence that the plaintiff was unmanly, or at least acting in an unmanly way, plaintiff's allegations were simply of mistreatment at work, and not nearly enough to support a Title VII violation.

In a same sex harassment case, with an all male work force where profane and obscene language is common, the dissent said that the reason for harassment (i.e., whether it is because of sex) must be separately proved by the plaintiff. Bad language and lewd actions are simply not enough. This is particularly true in a situation where the alleged harasser treated everyone at the worksite with derogatory comments, and homosexual insults. As the dissent notes, it make no sense at all that a heterosexual male can discriminate against another heterosexual male by simply calling him names indicating unmanliness, which both know not to be true by conduct or appearance.    

So this is a disturbing case, reflecting an analytical failure by a full federal court of appeals. With any luck the analysis won't get any further, because there are lots of bad words and conduct in a typical workplace, only a few of which are actually motivated by gender animus.

Friday, October 18, 2013

Boss's Day Thoughts

For National Boss's Day,  the WSJ put together some comments from staffing and consulting companies that show how bad bosses can damage workplace.

The comments are useful, if obvious, but I've always thought that to get real examples of bad management and how it affects people's work, you should talk to employment lawyers.  Let's face it, most of us have seen things that would curl the hair of those that still have some. The reported employment law cases are bad enough-the stuff that doesn't get reported is truly remarkable. So here are some hard won lessons regarding bosses from an employment lawyer:

1. Character matters. Supervisors who are dishonest, sleep around, and take advantage of people in their personal lives will, in my experience, infect the workplace with their lousy moral outlook. And notwithstanding our views that people can compartmentalize bad behavior (think Bill Clinton, for example), my experience is that who you are inevitably comes out around people with whom you spend most of your non-sleeping day.

2. Accountability is the hardest attribute to develop in a modern manager.  For whatever reason, people are loath to hold their subordinates accountable until things get absolutely intolerable. Front line supervisors and mid-level managers must be able to identify the strengths and weaknesses of their direct reports, and act appropriately in response to demonstrated instances of poor performance.

3. Supervisors should take care of their subordinates, both in terms of protecting them and ensuring they have physical necessities to perform their work, and to ensure that they develop professionally within the company. This aspect of leadership is often lost on American corporate managers. I saw the best example of its application when I was a cadet at the Air Force Academy. The officer in charge of my cadet squadron and I were getting ready to line up to get a meal at a field kitchen. He pulled me aside and we waited until all the cadets under my command were in the chow line and being served. Only after everyone had food on their plate did we get our meal. "As commander, you eat last," the officer said. The message was explicit-your job as a boss is to take care of the people underneath you first, and worry about your personal needs later.  In the same vein, the best bosses look to develop the professional strengths and mitigate the professional weaknesses of their subordinates so that they continue to grow as employees and develop skills that will make them more of an asset to the employer, and also better themselves.  By the way, the officer in question was easily the finest officer with whom I served in 27 years of active and reserve time.

May all of your bosses be good ones.

Friday, October 4, 2013

More on Convictions And Hiring, Wisconsin Style

A very troubling recent decision out of the Wisconsin Labor and Industry Review Commission should give pause to any employer that does criminal background checks for its Wisconsin employees.  The case is a very clear representation of how state employment commissions are working to undercut employers’ ability to minimize risk to their work force and customer base.

In this case, the Commission was faced with a claim of discrimination by Walmart when it fired one of its forklift drivers after discovering that he had been convicted of sexual assault, first degree reckless endangerment, and false imprisonment, stemming from a domestic incident with his then girlfriend.  The employee’s girlfriend tried to breakup with him and in response, the employee threatened her with a gun and a knife, threatened to commit suicide, and forced her to have sex with him against her will.  When it discovered these facts, Walmart terminated the employee from his warehouse forklift driver position.

Under Wisconsin law, an employer cannot discriminate against an employee because of a criminal conviction unless the crimes are “substantially related” to the particular requirements of the employee's job.  Amazingly, the Commission determined that because the crimes were committed at home, and not at the workplace, and occurred in response to a dating relationship, there was little danger of a repeat occurrence on the job.  The Commission also found that Walmart’s strict oversight of its warehouse operations would likely deter any sexual assaults by the employee in the future.  The Commissions reasoning is, shall we say, sparse – it does not explain why someone who sexually assaults a person in their home is not likely to do it at work, particularly when the evidence presented showed that the employee would be left unsupervised in the warehouse for extended periods of time.

I don’t have a good response to the Commission’s very troubling decision.  Walmart presented the evidence required under the statute and older case decisions to justify its action.  The Commission simply rejected the evidence and precedents.  As a result, employers contemplating taking an adverse action based on a conviction record in Wisconsin should carefully articulate all possible connections between that conviction, and the job in question.  Perhaps if Walmart had demonstrated that the warehouse was opened to customers, or that the employee would be dealing with significant numbers of female employees, the result might have been different.

Some White Collar Concerns, And I Don't Mean Laundry

In a corporate compliance world, companies need to be constantly on the lookout for business practices undertaken by their employees that could expose the company to significant liability, even (or especially) where the company management is unaware of these activities.  A couple of recent cases drive this point home.

The Fifth Circuit held that a corporate entity could be gouged for the unauthorized kickback activity of its employees under the provisions of Anti-Kickback Act.  In this particular case, employers of the federal contractor were accepting meals, drinks and recreational activities from subcontractors in exchange for providing the subcontractors with, well, subcontracts.  Two employees brought a qui tam suit for the alleged kickbacks and the USDOJ intervened, filing its own complaint under the kickback statute.  The Fifth Circuit determined that the Anti-Kickback Act not only allowed recovery from a “person” , but that the term “person” was broadly enough defined to include corporations and other business entities.  The Court then held that the acts of the corporation’s agents and employees could be imputed of the corporation under a theory of vicarious liability.

This is a a new holding and a scary one.  Employers must assure that their employees are aware of the anti-bribery and anti-kickback statutes.  Moreover, companies should be taking steps to periodically monitor the conduct of their employees to insure problems (in this case routine acceptance of gifts), or even the opportunity for problems, is not arising.

Along these same lines, publicly held companies should be aware of the differing standards of liability that arise out of the Sarbanes-Oxley and the Dodd-Frank Acts.  Both statutes protect whistle blowers, i.e, employees who raise concerns about potential SEC violations with their employers and then suffer some type of adverse employment action.  Here is the key difference – Dodd-Frank requires a report by the employee not only to the employer, but to the SEC as well.  Sarbanes-Oxley only requires a report to the employer (although other Sarbanes-Oxley provisions are not quite as employee friendly as Dodd-Frank).  There is a good discussion in this recent Fifth Circuit case.

An employee who makes an internal complaint regarding the company’s securities practices should set off a red flag in any event, but be aware that Dodd-Frank liability only attaches under one set of circumstances, versus the easier reporting requirements of Sarbanes-Oxley .  There are differences in how you respond to each one.

Unpaid Internships Can Be Very Costly

Now that college students have returned to campus, effectively ending the summer season of cheap and relatively well-educated available labor, employers should examine their unpaid internship programs to make sure they are compliant with federal wage and hour law.  This is especially important because the Department of Labor has begun a campaign against these unpaid programs, and the interns themselves are filing lawsuits for back and overtime wages that were never within the contemplation of the parties when the working arrangement began.

Unpaid internships can be a valuable mechanism for an employer to train and recruit potential employees, while at the same time providing some much needed job assistance and experience to experienced workers.  Although the Fair Labor Standards Act specifically authorizes the use of unpaid internships, these positions are subject to some fairly strict requirements.  In April, 2010, the DOL published a fact sheet that detailed a list of requirements for unpaid internships that met the FLSA requirements.  Basically, these internships must:

1. Be similar to training that would be given in an educational environment.
2. Primarily be for the benefit of the intern.
3. Not displace regular employees and work under the close supervision of existing staff.
4. Not provide an immediate advantage to the employer from the activities of the intern; in fact, on occasion, the employer’s operation could be impeded by the intern’s activities.
5. Not be contingent on a job offer at the end of the internship.
6. Understand, along with the employer, that the intern is not entitled to wages.

Note that some of these requirements are not obvious-I've often said that if I have to pick a statute that my clients are most likely violating unwittingly, it's the FLSA.  Given the DOL’s push and scrutiny of these relationships, as well as the increased litigation pace around them, employers should scrub their internship offerings to make sure they are in fact being carried out with these requirements in place.

UPDATE:  Here's an interesting aspect of the internship issue-a federal court in New York has denied a sexual harassment claim by an unpaid intern on the grounds that because she was an intern and not a paid employee, law prohibiting sexual harassment did not apply.  Note that this position is consistent with the EEOC's interpretation of federal employment law, as well.

Your Basic Workers' Compensation Bar: It’s Pretty High

Workers' compensation cases typically are not the stuff of high-end legal analysis.  That’s mainly because much of the jurisprudence has been settled for years  Nevertheless, it's nice to see the occasional case that lays out workers' compensation issues as clearly as this one.  Moreover, the stakes on this case were very high, so there was a lot of incentive on the part of the injured party’s counsel to litigate even the most basic workers' compensation issues.

The case arose out of a tragic airplane crash that occurred in January 2006, which killed several financial advisors employed by Morgan Stanley, as well as the owner of the aircraft and a Morgan Stanley customer.  The Morgan Stanley employees were returning from a client pitch in Kansas City. Although the aircraft was not owned by Morgan Stanley, one of the Morgan Stanley passengers was apparently interested in purchasing the aircraft.

The estate of one of the deceased Morgan Stanley employees filed a a wrongful death action, going after Morgan Stanley and the aircraft pilot.  The trial court dismissed the case, finding it preempted by Illinois workers' compensation law and this appeal followed.

Workers' compensation law occupies a unique position in American personnel injury jurisprudence, because it specifically limits the recovery of an injured employee in exchange for strict liability against an employer.  Employees who are injured at work, or pursuant to work activities, are entitled to payment, regardless of fault, under the specific terms and limitations of a state workers' compensation statute.  Usually the employees receive compensation for lost wages at a specified percentage, as well as full payment for medical bills relating to their condition.  Injuries that are covered by workers' compensation statutes have exclusive remedies, in that an employee injured at work can only recover (or is "barred") under the terms of the workers' compensation act.

The trade-off, of course, is that the money paid out to the employee is only a fraction of what could be recovered in a typical personal injury case.  For that reason, injured employees generally look for some way to get around the workers’ compensation “bar” to individual personal injury lawsuits. That’s exactly what was happening in this case.

In Illinois, employee can sue and recover outside the limitations imposed by a workers' compensation statute if she can show that the injury was not accidental, did not arise out of employment, was not incurred during the course of employment, or was non compensable under the statute.  In this case, the estate of the one of the deceased Morgan Stanley employees tried to evade the compensation limitation by claiming that the injury was not accidental, and that the accident arose out of activity by the employer that was not related to its business operations, and therefore it was outside the statue.

The court made quick work of the argument that the accident was in fact an intentional tort by the employer.  The plaintiff was alleging that the employer, because it didn’t have rules in place for employees riding by private aircraft, had somehow intended (or at least was grossly negligent) for one of its employees to fly in what was supposedly an unsafe aircraft.  The court noted that this particular exception to the worker’s compensation bar requires more than even aggravated negligence or being ordered to perform hazardous work – it must show an actual intent to injure the employee on the part of the employer.  The plaintiff, of course had no such evidence.  The plaintiff also argued that Morgan Stanley was acting in the independent and distinct role of providing air transport services, a role that was unrelated to its status as an employer.  Specifically, the plaintiff alleged that Morgan Stanley’s practice of reimbursing its employees travel expenses showed that Morgan Stanley, a financial investment and consultant firm, was running a de facto transportation operation that was totally unrelated to its financial advising business.  Therefore, an accident resulting from that air transport business was outside the normal employer relationship and outside the coverage of the workers' compensation statute.

As I said, the amount of money at stake here made people creative.  Fortunately, it did not make the court that creative.  The appellate court found that the "dual capacity doctrine" voids workers’ compensation coverage when an employer is acting in two distinct capacities, such that the second capacity confers upon the employer obligations that are independent of those imposed on the company as an employer.  In fact, the doctrine requires a separate and distinct legal persona for the employer that was the ultimate source of the injury.  In other words, an employer has to be acting in two separate capacities such that the second capacity confers different obligations than the employer's business--the employer has to have a separate legal persona completely independent from and unrelated to its status as an employer such that by an established standard the law recognizes the other role as a separate legal person.

That obviously was not the case where Morgan Stanley had simply agreed to reimburse its employees for transport expenses.  The court also specifically determined that the fact that Morgan Stanley allowed a small group of its employees who were private pilots to fly to appointments did not constitute a secondary business activity sufficient to avoid the protections of the workers’ compensation statute.

Employers should be aware of these limitations to their workers’ compensation protection, but can draw plenty of comfort from the fact that courts view the workers’ compensation structure as sacrosanct.  Any legal constructions of the law that weaken or circumvent workers’ compensation protection will continue to be limited.

Tuesday, September 3, 2013

Sixth Circuit Limits Second-Bite Motions in Limine

"You don't get a second bite at the apple."  Words that strike fear into the heart of any litigator--it means that you had a chance to do something about your problem, you took it, your strategy didn't work, and now you won't get another opportunity to fix the problem, even though you have now thought of some ingenious ways to do so.
That's the story behind the Sixth Circuit limiting a party’s ability to exclude evidence before trial.  Specifically, the Court held that district courts may not entertain motions in limine (which are used to preclude the presentation of specific evidence in advance of trial) involving issues that were previously raised, or should have been raised, in a failed motion for summary judgment. The court held that these kinds of motions intrude on the jury’s role as the fact-finder and deny the opposing party the procedural protections of summary judgment.
In Louzon v. Ford Motor Company, the employee plaintiff took an approved leave of absence from his employer, Ford, to visit family in Gaza.  While abroad, security issues in the region caused Israel to close its boarders, making it impossible for the plaintiff to return back to the United States.  Ford initially extended his leave of absence, but by the time he was able to return, the extension expired and Ford terminated his employment.
The plaintiff sued Ford alleging age and national origin discrimination as well as retaliation.  After the court denied Ford’s motion for summary judgment, it filed a motion in limine to exclude plaintiff’s evidence of comparable employees on the basis that none of them were similarly situated as a matter of law.  The district court granted Ford’s motion and ultimately granted summary judgment in its favor.
The Sixth Circuit held that the district court improperly considered non-evidentiary issues in limine and vacated the grant of summary judgment.  Specifically, the court held that summary judgment is the proper mechanism to resolve non-evidentiary matters before trial.  Allowing a party to litigate issues that have been or should have been resolved at an earlier stage not only allows those dissatisfied with the court’s initial ruling a chance to re-litigate, but also deprives their opponents of the procedural  protections attached at summary judgment.
This decision means that employers will no longer be able to utilize motions in limine as a second bite at the apple when an initial summary judgment motion fails.
Thanks to my associate Susan Baker for this blog entry.

Worker’s Compensation Retaliatory Discharge: Termination vs. Layoff vs. Suspension

A recent Illinois worker’s compensation retaliation case demonstrates a subtle, but important distinction for employers, especially those that use seasonal employees, or lay off workers while keeping them subject to recall.

The facts of the case, which originated out of Illinois’s 3rd District in Peoria, are a little confusing. Plaintiff was a registered nurse working in a rehabilitation unit in a medical center. She injured her knee, which required surgery to repair the damage and resulted in her having a 20 pound lifting restriction, which ultimately became permanent. This limitation disqualified the employee from her RN position; the company HR representative then mistakenly advised the employee that she was going to be terminated within 30 days if she could not find work within the medical facility. The company ultimately issued plaintiff a letter indicating she was terminated on June 18, 2008 (yes, it took 5 years for this case to make its way to just a first level appeal) and the plaintiff henceforth acted as if that was the date she was fired. In the meantime, the company attempted to rescind its termination by notifying Plaintiff that she could return to work, but by then the plaintiff had moved and taken another position with another employer.

Plaintiff sued for retaliatory discharge, under the Illinois Worker’s Compensation Act, claiming that she was fired in retaliation for filing a worker’s compensation claim. She ultimately amended this to allege not a retaliatory discharge, but rather a retaliatory failure to recall to work. Based on plaintiff’s admissions in her pleadings that she was terminated on June 18, 2008, the trial court granted summary judgment for the employer, and the Appellate Court affirmed.

The Appellate Court’s opinion raises an interesting point of law on retaliatory discharge claims with respect to worker’s compensation. Specifically, an employee who has been fired by her employer can generally only sue for retaliatory discharge. She may not sue for failure to rehire or failure to recall, which are expressly reserved, under Illinois law, for claims by seasonal employees (failure to rehire when seasonal hiring begins) or regular employees on leave or temporary layoff (failure to recall). In other words, in Illinois, a terminated employee gets only a retaliatory discharge claim. The Appellate Court noted that it would not allow a claim for failure to rehire or recall for a terminated employee because Illinois courts will not force an ongoing employment relationship between hostile parties when it can use monetary damages to compensate the unfairly terminated employee.

The vast majority of retaliation claims under workers compensation will be for retaliatory discharges, while failure to rehire/recall will be reserved for those rare circumstances where there are seasonal employees in play, or layoffs and leaves of absences occurring and the employment relationship is ongoing. Here, the plaintiff’s failure to recognize that she could not assert a retaliatory failure to rehire/recall claim since she had admitted she was terminated, worked as an effective bar to her lawsuit.

Monday, August 19, 2013

EEOC Gets Rebuked By Federal Court on Criminal Background Check Allegations

As I have noted previously, the EEOC is all hot and bothered about employers using criminal background checks to screen potential new hires. The cynical side of me says this is simply a political ploy to generate votes out of the traditional Democratic population, but it has significant ramifications for employers.

At least one federal judge has noted the “Catch 22” that the EEOC’s position creates for employers, namely that the EEOC is suing employers for conduct that prevents other people from suing these same employers and the employer is heavily penalized either way.

The most recent case comes out of the federal court in Maryland, and involves a “pattern or practice” case brought by the EEOC against a company that provides services for expositions, conventions, corporate events, meetings and exhibit programs. The very nature of the business means that some employees often handle significant amounts of money, as well as come in frequent contact with customers and their guests.  Under these circumstances, and given the fact the company operates across the United States, it would be inconceivable for its management not to require background checks, including criminal and credit background checks, for its employees. That is exactly what the company did, although it was quite specific and careful in the way that it did so. For example, general employees who did not hold credit sensitive jobs were subject only to a criminal history investigation and social security verification. Employees in credit sensitive positions also passed a credit history review. For company officers, general managers and department heads, the employer performed an education and certification verification. Overall, the company ran credit checks for 44 job titles out of 153 positions that it identified in its policies.

Nor was there a blanket hiring exclusion for criminal convictions – the company offered the opportunity for an applicant to explain a criminal conviction, did not consider any criminal convictions that occurred more than seven years before the application date, and used a multi-step procedure to deal with convictions, arrest warrants, and other criminal record issues. Any initial decision by an office manager not to hire an applicant because of a conviction record was reviewed and approved by the senior vice president for human resources before becoming final.

With respect to credit checks, the company used 12 separate standards for exclusion of an applicant from a credit sensitive position, ranging from accounts of $300 or more that were more than 90 days past due to unsatisfied liens and delinquency in paying child support.

In fact, the company did not use a blanket hiring exclusion based on any single criterion, with the notable exception of a false statement on the application.

Nevertheless, the EEOC filed suit against the employer, claiming a pattern or practice of discrimination against African American job applicants by using credit history as a hiring criterion, and against African American, Hispanic and male job applicants by using criminal history as a criterion. As is typical in these cases, the Commission alleged that the company’s use of these criteria had a disparate impact on protected classes of employees.

Unfortunately for the Commission, in trying to prove its case that the company was discriminating in use of these background checks, it used expert testimony that was highly suspect, and ultimately thrown out by the trial court. The court's review of the Commission's sloppy analysis, which was based on equally bad data (the court demonstrated that the EEOC’s expert had cherry-picked information provided by the company to make the determination decisions look as bad as possible) is noteworthy, but the real focus of my concern is the burden of proof that the Commission had to sustain in these kinds of cases. Specifically, a plaintiff in a disparate impact claim has to not only show a general statistical disparity, but must point to a particular employment practice as the cause  of the statistical difference in hiring. Where a hiring process has multiple elements, as in this case, a plaintiff has to identify the elements that it is challenging and demonstrate that each particular challenged employment practice causes a disparate impact. This is a significant burden indeed, and one that the Commission absolutely failed to establish in the case.

A key lesson for employers – do not make your review of background check criteria a one-step process. The court determined that by using different types of criteria depending on a specific job, and simultaneous consideration of both subjective and objective criteria for hiring, an employer created a long list of factors, each one of which had to be assessed and evaluated by the plaintiff to cull out the problematic element. This creates several evidentiary problems for any plaintiff, among them the need to conduct an extremely thorough and competent regression analysis that analyzes each key hiring qualification, while at the same time zeroing out the influence of the other factors. Moreover, the analysis has to be performed on a population that is comparable to the population that applies for these positions, or is at least qualified for these positions.

So the lesson for the employers is fairly straight forward – do not put in place a broad spectrum disqualification criterion based on whether an individual has a bad credit record or conviction history. Rather, the employer should match various types of credit issues, and conviction records, to specific jobs and develop a rational explanation for how it weights each factor. Doing so will go a long way in convincing a trial court that the employer is trying to live within the limits of the Title VII and the antidiscrimination statutes. Doing so also presents a potential plaintiff with a significant evidentiary burden.

Faced with an employer that carefully assesses credit and conviction records, courts will usually hold plaintiffs to a high standard on these disparate impact cases. As the trial court in this case put it, anything less, " would be to condemn the use of common sense, and this is simply not what the discrimination laws of this country require.”

Wednesday, August 7, 2013

The Pernicious Impact of Long-Term Unemployment

A hallmark of the current awful economy (I know, I know, the President keeps saying things are getting better, but the short answer is that without full-time jobs becoming available, things are getting worse for much of working America, not better) is the number of people who have been unemployed for an extended period, in some cases dropping out of the workforce altogether. Economists have long known that the longer you are not working, the harder it is to find a job. But now there's some hard data that quantifies just how difficult it is for the long-term unemployed to get back in the game.

In an article entitled "Out of Work over Nine Months? Good Luck Finding a Job", the WSJ notes that more than 3 million Americans have been out of work for more than a year, and that doesn't even include the numbers who have simply stopped looking. Many of them will likely never work again, in fact.

Part of the reason for that depressing conclusion is that people who've been out of work for a long time are stigmatized by companies, to the extent that even qualified candidates with a long jobless stretch are rejected by employers.

The article cites a study by two Swedish economists who applied for more than 3500 jobs using some 8500 fictitious resumes. Some of the phantom applicants had uninterrupted employment histories, some had unemployment histories previously, some were currently unemployed, and the lengths of unemployment for the applicants varied.

The study showed that short-term spells of unemployment (six months or less) didn't really affect job seekers' prospects, and might even have been an advantage for low-skilled positions. But for low- or medium-skilled positions (which didn't require a college degree), being unemployed for nine months or more caused a precipitous drop in the callback rate. The pattern wasn't nearly so bad for college degree positions--another reason you should tell your kids to finish college. And even for long-term unemployed, once they started working, the stigma of being jobless virtually disappeared when they applied for their next position.

How does the Swedish study apply to United States? Although the job markets are relatively similar, there's at least some evidence that US employers take a harsher view of long spells of unemployment.

The lesson here-employers need see passed unemployment histories and try to determine if the individual reflected in the resume actually has a desirable skill set. As usual, focus on specifics that relate to a particular position, look for explanations for the unemployment, and assess the actual qualifications of the potential hire. Notwithstanding the concern that long unemployment raises with most employers, companies are likely passing up what are effectively bargains if they allow a visceral reaction to unemployment to affect their analysis.

Tuesday, August 6, 2013

Do Not Use This as a Defense--Just Sayin'

One of the reasons why I like employment law is that no matter how many types of cases you see, there is always something even more bizarre around the next corner. So let's turn the corner and our attention to Bob Filner, the Mayor of San Diego, a 70 year-old Democrat who apparently never met a woman he didn't try to grope or sexually harass. In fact, things were so bad that his honor's staff apparently had a rule that women were not allowed in to see him without an escort, under any circumstances. At last count, there were at least 10 women who have come forward indicating that Filner inappropriately touched them or propositioned them. And he has only been the mayor since November.

All of this would be bizarre enough, but Filner’s lawyer rolled out a legal defense, or at least a way of paying for a legal defense, that is almost as insulting as the actual harassment itself. Filner’s counsel alleged that the City of San Diego should have to pay for the mayor’s lawsuit defense (Filner’s former director of communications has filed a harassment lawsuit) because Filner never received mandatory sexual harassment training from the City. This is the functional equivalent of somewhat defending a murder claim by saying that they should be given a break because no one ever told them that it was illegal to kill people.

For those of you who are confused about whether this is an intelligent strategy – please refer to headline at the top of this article and let's hope the taxpayers of California’s second largest city not only reject this silly claim but also boot this guy out of office

UPDATE:  I seriously can't make this stuff up.

“But He was so Good Last Season”

I am always astounded to read about major league sports team owners, or even management (who should know better), and their unwavering belief that certain older star athletes will be the saviors of the organization, notwithstanding the inexorable decline that sets in after a certain age.

In fact, banking on older athletes, especially in the NFL, where the physical wear and tear means an average player’s career is less than 4 years, seems like even more than a crap shoot than the rookie draft. Its certainly more expensive; older players usually command huge compensation even as their physical skills start an often precipitous decline.

A classic example is taking place in California this year, where the California Angels shelled out truly monster numbers for players Albert Puljos and Josh Hamilton, only to see them perform at a level well below their previous career highs. Puljos is in his 12th season of a career that has been truly remarkable. Hamilton, although a year younger than Puljos, has also had a stellar career, although its been marred by incidents of drug and alcohol abuse. But, as this article notes, most baseball players peak before their 30th birthdays. Guessing on which player is likely to have longevity passed 30 is an art, not a science. This is particularly true once you factor in the lingering affect of the injuries incurred after 30, and how frequently players who were productive up to that point are unable to overcome them.

As I noted, the stakes on gambling with older players are even higher in the NFL because of the shortened playing careers, the increased chance of catastrophic and career ending injury, especially for older players, and the extremely limited season (16 games, versus 162 in baseball and 82 in the NBA) in which the players have a chance to make an impact.  Here's a nice breakdown of terrible NFL contracts, along with a useful methodology for assessing, from one of my favorite publications, Grantland.  For my money, the category for most of the aging players is "Falling in love with a player they shouldn't have".

Sports management is rapidly moving towards a more metric based kind of system – this is one metric that should be embraced with more regularity.

Age Matters

Here’s an interesting article regarding a study about people’s perceptions of older people and their attitudes, and how it might affect the workplace. Age discrimination cases are notoriously difficult to prove not only because of the higher standard of proof (an age discrimination plaintiff has to show that his age was the “but for” cause of the adverse employment decision; plaintiffs with Title VII discrimination claims only have to show that the protected factor “motivated” the employment decision), but the evidence of age bias is usually not nearly as direct as it is in other forms of discrimination cases.

The study revolved around the reaction of 137 Princeton University undergraduates, who were shown a video of someone who would be their partner in a trivia contest talking about themselves. These potential partners were all white males, but were either 25, 45, or 75 years old. Each one adhered to the same script in talking about himself, except that half the time the person indicated that he was the kind of person who shared his wealth with relatives (a "compliant" personality), and the other half of the time he said he had no obligation to share with relatives. For the 25 or 45 year old subject, it made no difference whether he was generous or not, but the 75 year-old who indicated he was not generous (this was characterized as being “assertive” by the researchers) received a very high negative rating from the undergrads.

The lesson- if you are an older worker, and you want to speak your mind to your manager, you should expect some fall out. Does this equate to age bias? Unquestionably, but it appears to be something that is fairly subtle, although strongly ingrained.  Per my standard advice, the key to combating this type of bias is to focus on performance specifics, rather than some unspecified type of gut reaction to a particular individual. My guess is that it's easier for people to recognize visceral reactions triggered by race or gender, but it's clear from this study that age can generate just has negative a response.

There is a lot more research developing on the this type of bias, since these age discrimination claims are the fastest increasing type over the last few years. That trend should continue as Boomers move into the Social Security zone, but find it increasingly necessary to work.

Bad Boss Stories

In truth, the descriptions of these bosses don't seem that bad, at least compared to some of the cases with which I am familiar. The guy who knocks over furniture and throws things around in the office is pretty bad, and probably should be fired, along with the supervisor who hit whiffle balls at people when she got angry. What I find particularly interesting about most of these stories is that after the affected employees were either fired or quit, their outlook on life improved immeasurably. They became productive and successful, which makes me think that in fact they were being managed by incompetents.

Incompetent, bullying, ego-maniacal managers can wreak havoc in an organization well beyond their area of immediate oversight. Given America’s “bottom line” business culture, it's easy for management to either overlook or simply miss the methods being used by a "productive" supervisor to get results from her people. In fact, my experience is that high level bullying goes virtually unreported or reviewed because of the assumption that everyone at that level knows how to do their job. That’s why I am a big fan of so-called 360 degree job performance reviews, in which a supervisor is rated not only by her supervisors, but by her peers and her subordinates. Companies can learn a lot of information about what’s really going on by listening to co-workers.

Wednesday, July 17, 2013

NFL Stars Repudiate Foolish Trayvon Comments

Well, that didn't take long.

Shortly after the Trayvon Martin verdict came down, two NFL wide receivers made ill considered comments on Twitter  (I'm thinking the NFL, or at least the clubs, should consider a total Twitter timeout-a "TTT"- for everyone on their rosters; see my social media and athletes post of about a year ago).  Roddy White of the Atlanta Falcons recommended that the jurors just go home and kill themselves, while Victor Cruz of the Giants tweeted that it wouldn't be too long before the the "hood" caught up with George Zimmerman and made him pay.

As the press firestorm began to break on these two gentlemen, someone-I hope it was their agents, who should be earning their pay-got to the two players and explained to them that not only might their outbursts affect future endorsement deals, it could actually subject them to discipline under the NFL off-duty conduct policy.  The apologies and retractions for the comments followed shortly thereafter.

Good move, gentlemen.

Saturday, July 13, 2013

The First NFL Bountygate Personal Injury Suit

I thought it wouldn't take this long, and I also think they're in the wrong forum, but an NFL player is finally suing over Bountygate, alleging that he was targeted for injury as a result of Gregg Williams' bounty program for injuries when Williams was coaching at Washington.

Links are here, here, and here to several stories on the complaint, which is still behind a firewall.  But it alleges both criminal and civil battery against a Redskin player, motivated by the coaching plan of rewarding people who injured opposing players.

I think this case would be a better fit under the jurisdiction of the NLRB--it may be pre-empted to go there in any event.  For one thing, the conduct alleged is a violation of the CBA because it involves payments for players "off the books", something that is a major violation of the NFLPA-League agreement.  Whether the League wants to push the case to the Board is another thing, but there might be some good reasons that the clubs and Williams want to avoid a federal jury trial on this matter.

Saturday, July 6, 2013

"Wax on, wax off" or You're Fired

This is a case making the rounds of the employment law blogosphere for its salaciousness and silliness. In western Pennsylvania, a woman is suing her employer, a waxing salon, after she was fired for refusing to participate in a Brazilian waxing session with co-workers, which is part of the training program at the chain of salons.  Specifically, the woman claimed that she was ordered to Brazilian wax her female co-workers, and to allow herself to be waxed, to train in the procedure.

This sounds reasonable--given what little I know about having pubic hair pulled out by the roots, if I were a customer, it's a process I would prefer to have done by someone who had at least practiced.  But the plaintiff claims gender discrimination because men weren't required to do this.

Yeah, I'm pretty sure there aren't a lot of guys lining up in Pittsburgh salons to get burning wax applied to their nether regions, followed by having their hairs ripped out--this is one of those things where women are either a lot tougher, or dumber, or both.  Given that this is an almost exclusively female practice (although if the salon employed male waxers, I could see there being a similar requirement), I'm pretty sure this case fails as gender discrimination.  The retaliation claim falls as well, because the initial complaint of gender discrimination doesn't seem well-founded.

Where's Pat Morita when you need him?

Friday, July 5, 2013

Looking Good--Iowa's Supreme Court Reconsiders

Apparently the Iowa Supreme Court is going to reconsider its most discussed case in recent memory, the so-called irresistible attraction case involving a dental assistant who was fired for being too pretty.  As you may recall, the assistant's boss, the dentist, determined that she was too attractive after his wife, who also worked in the practice (there's a lesson here, gents) found sexually provocative messages on her husband's computer from the assistant.  The assistant sued for gender discrimination, and the Supreme Court found, unanimously and reasonably I might add, that terminating an employee based on her attractiveness was not discrimination or harassment based on gender.

The Court is hearing this with no additional oral argument and will basically be rehashing its original arguments with no input from the lawyers or anyone else.  The general consensus is that the decision will remain the same, but that one or more of the Justices will file a dissenting opinion in time for upcoming elections.  Nice to know people aren't going too far with that whole impartiality thing.

Thursday, July 4, 2013

How To Structure and Promote Innovation

Here's a thought provoking piece from the Journal about how companies develop innovation and creative thinking in their employees.  It runs counter to the traditional model of "thinking outside the box."  In fact, the authors note that people are at their best when their creativity is channeled into making the best of a situation with limited options and outcomes.  Then a group's natural familiarity with its resources, be it a product or process, can fully come into play to solve the problem.

Of course there are techniques to this type of problem solving.  The authors list five: subtraction (removing a heretofore essential element); task unification (consolidating or combining unrelated tasks or elements); multiplication (copying an item and then altering it); division (separating and rearranging elements of a product or process); attribute dependency (make the attributes of a product change in response to changes in the environment or other attributes).  Teaching employees to think like this when analyzing workplace issues can pay big benefits in creative responses to an intractable problem.

I used to think that you couldn't train for creativity.  This article causes me to reassess my position.

Working Women, Part 2

This article from Foreign Policy has some fascinating data on working women and the impact of maternity policies, education efforts, and anti-discrimination efforts from a global perspective.

The abridged version--American women are in better shape than working women in most of the world (especially when it comes to high-level management positions), and there is a persistent gap world-wide between the number of women in the general population and their participation at higher levels in the workforce.  This gap has persisted despite the best efforts of any number of social engineers.

Worth a read, as the US continues to wrestle with workplace equality issues.

Wednesday, July 3, 2013

Bullies Get Ahead, But Where?

A recent study shows that bullies, far from being ostracized in the modern workplace, are in fact often promoted and get good performance evaluations from their superiors.  This leads to some interesting questions:

-  I suspect that bullying, like sexual harassment, is a highly subjective concept.  One person's bully is another's effective motivator, or is seen as simply a little gruff, or socially maladept.  Lots of people tell stories about being bullied, but is there some type of workable definition, other than making someone feel bad?  If I consistently tell someone their work is terrible (because it is, in my opinion as their boss), and tell them their job is in danger, does that equal bullying?

-  Again, like sexual harassment, there is a sliding scale of frequency and severity for bullying.  A physical assault would clearly establish a bullying situation, but mean or threatening remarks would have to be repeated to get an equivalent perception.

- Does it make sense to establish so-called 360 degree review programs, where a supervisor is rated by subordinates as well as superiors?  And would we get any more honest criticism from the folks reporting to someone than we typically see from superiors?

- I think that most of us would agree that certain types of conduct--personal insults about appearance, for example--would be a basis for disciplinary action.  But how common are these circumstances?  I don't think I've ever had a situation like that arise.  I have seen threats--"if you ever raise an objection to my proposals in a meeting again, I'll get you fired."  Is that bullying?

- Are there certain relationships that promote bullying behavior?  Obviously ex-paramours  working closely could be trouble, family members, too.  Anything else come to mind?

- Where the conduct is clearly personal, how much involvement should the company have, and what should be its level of responsibility to prevent further conduct?

Return of the Two Week Vacation?

Supposedly people are taking longer vacations then they used to, mainly because modern technology allows them to be in touch with their offices/businesses while on the road.

Excuse me, but that's not a vacation. That's hauling your work stress to places where you can't handle emergencies nearly as well as you can at your office, and making everyone else around you, who expect to be enjoying themselves, miserable in the process. It's also a great cure for marital happiness--trust me on this.

Are employers more tolerant of extended time away? Maybe, but most of my clients are happy to trade a long vacation with connectivity for shorter time away so that they can disconnect completely.

I don't seem to be able to do even that, unfortunately. I hope you can.

The Supreme Court Refines the Supervisor Definition for Workplace Harassment Cases

In Vance v. Ball State University, the Supreme Court refined workplace harassment jurisprudence under Title VII to provide employers with more guidance about who creates strict liability for a company.

This is an important decision. In Title VII harassment cases, an employer can escape liability for a coworker's harassment if the employer is negligent in controlling the victim's working conditions and ignores reasonable complaints of harassment from the victim. But where a supervisor is involved, the rules become significantly more onerous for an employer. If a supervisor's harassment results in a tangible employment action (typically hiring, firing, failing to promote, reassignment with different responsibilities, or some other significant change in benefits), then the employer is strictly liable, whether it acted reasonably or not. Only in situations where there is no tangible employment action as a result of supervisor harassment can an employer escape liability. The employer does this by proving an "affirmative defense": that it took reasonable steps to prevent harassment and the plaintiff failed to take advantage of corrective opportunities.

There has been a dispute about who exactly is a supervisor that imposes this greater burden on the employer ever since the standard was announced in the Fargher and Ellerth decisions, . Because the term "supervisor" is not defined in Title VII, lower courts have wrestled with what constitutes the role in order to establish the crucial liability standard.

The Supreme Court here tries to clear up the confusion by determining that a supervisor is someone empowered by the employer to take tangible employment actions against the victim. In other words, a supervisor is not someone who simply make day-to-day assignments, she must be a person who can fire, hire, demote, or otherwise make a significant impact on the terms and conditions of the victim's employment.

This is a big deal not only in the context of litigation/causation issues, but for employers trying to develop preventative programs. Supervisor training, for example, because of the implications of supervisor harassment, is typically quite different than line staff training. This decision gives employers a clearer picture of who exactly can commit them to strict liability issues, and allows employers to focus training on those positions exclusively. Vance represents a significant set back for the EEOC, which tried to argue that a much more nebulous definition of supervisor--any position that simply controls someone’s daily work in a significant way--was sufficient to establish supervisor status. This case, at least in my opinion, puts the emphasis where it needs to be: on employers to make sure that the people to whom they delegate crucial and important personnel decisions on a day-to-day basis, are properly trained and notified of their roles in the Title VII system.

Supreme Court Sets the Causation Standard for Retaliation Cases Under Title VII

A recent Supreme Court case involving retaliation claims under Title VII sets an important standard for companies facing retaliation claims. Retaliation claims are a significant problem for employers because they are generally easier to prove--it's easier to convince juries that retaliation has occurred rather than outright discrimination. Employers faced with an employee who has complained of discrimination (and thereby placing herself in Title VII's “protected activity” category) are at a distinct disadvantage to show that they did not factor the protected activity into a subsequent termination demotion or some other type of adverse action.

This makes perfect sense when you think about it – most jurors probably have difficulty believing that a modern company would engage in outright race or sex discrimination. However, those same jurors have little difficulty believing that a company would take action against someone who ratted the company out to the EEOC, or challenged a particular supervisor with a claim of discrimination, whether right or wrong. In fact, as I've said before, its not uncommon to see cases where a jury finds an employer not guilty of discrimination, but guilty of retaliating against an employee who makes a claim of discrimination that the jury did not believe.

So holding that a plaintiff employee must prove that an employer's retaliation was the “but for” cause of an employment decision is a significant move by the Court. I think it’s the right result– the language of that portion of Title VII that covers retaliation claims was not modified by the language of the Civil Rights Act of 1991.  That law amended the proof standard for run of the mill discrimination claims (so-called "status" claims, because the discrimination results from an employee's racial, gender, or religious status) from a “but for” standard to a much easier “motivating factor” standard.

What’s the difference? A “but for” standard means that without the illegal retaliation as a cause, the employer doesn't take the adverse employment action. That’s a much higher standard than “motivating factor”, which means that the protected activity could be one of several reasons for the employer's action, not necessarily the single "cause."

So this case is important for employers. Whether the president and Congress will follow the dissent's suggestion that they undertake some kind of legislative fix remains to be seen. But there is no doubt that for retaliation cases, the Court strengthened employers' chances with this decision.

Cook County Commission on Human Rights Has Limited Damage Options

A lot of employers in Chicago and its suburbs don’t know that, in addition to the federal human rights laws and the Illinois Human Rights Act, residents of Cook County have a third venue in which to raise a complaint – the Cook County Commission on Human Rights. In a case that reached the Illinois Supreme Court, the Commission ordered some $50,000.00 in lost wages, compensatory and punitive damages against a bar owner. The Supreme Court determined that the Commission did not have statutory authority to award punitive damages and reversed.

That’s interesting (sort of), but not as interesting as the facts used by the Commission to measure credibility. The case, involving sexual harassment claims, was a classic “he said, she said”. The bar owner denied harassing the employee, and brought forward a series of employees and patrons who denied the claimed incidents occurred. The Commission determined that the bar owner was not credible because he appeared to be nervous and continuously swiveled his chair sharply while he testified.

I could hardly imagine that someone being called to testify in front of the Commission might not be nervous, and I've never heard that swiveling a chair (or rocking back and forth in it as I am want to do) marks anything other than having a fair amount of nervous energy. In fact, this type of credibility assessment simply provides more fuel for the "Commission and its ilk are simply pro-plaintiff to the point of silliness" fire that burns in the minds of Chicago employment defense lawyers.

Lastly, employers in Chicago, and not just Cook County, should be aware that there is a fourth entity that provides coverage for civil rights violations – the Chicago Commission on Human Rights. Chicago employers need to be aware not only of various fora in which they could be charged, but the general standards to which the complainants will be held versus the companies that employ them.

Tuesday, July 2, 2013

llinois Court Tacks On an Important Limitation to Non-Compete Agreements

This recent case out of Cook County, affirmed by the Illinois Court of Appeals, sends a bit of a scary message for employers hoping to rely on non-competes that are entered into as a condition of employment. Fifield v. Premier Dealer Services, Inc. involves an insurance salesman marketing finance and insurance products to the automotive industry. He went to work for a subsidiary of Great American Insurance Company. Great American ended up selling the subsidiary to Premier Dealership Services, Inc. and terminating Fifield’s employment. Premier, however, offered to employ him, but with the requirement that he sign a non-compete agreement.

Of course, things didn’t work out – Fifield left Premier in the middle of February the following year and began working for a competitor in violation of the covenant. He sued to invalidate the non-compete agreement, arguing that he had not worked long enough at Premier for there to be valid consideration to support his non-compete agreement. Premier filed a counterclaim, asking for an injunction to enforce the non-compete agreement.

Illinois is one of those states that enforces a post-hiring non-compete agreement as long as the employer provides adequate consideration in the form of either compensation or additional employment. Case law in Illinois indicates that the additional employment should be for a minimum of two years. What makes this case unique, and particularly troubling, is that most courts recognize a distinction between consideration necessary for post- hiring non-compete agreements and the consideration required for pre-hiring non-compete offers. Pre-hiring non-compete offers are generally considered to have valid consideration supporting them because the offer of employment is contingent on the employee signing the agreement. Post hiring non-compete agreements, since they are not tied to an offer of employment, typically require additional compensation, either in terms of money, benefits, or continued employment. As noted, in Illinois the continued employment for post hiring non-compete agreements is generally considered to be at least two years.

Inexplicably, both the trial court and the appellate court found that whether an employment agreement covenant is offered either pre- or post-hiring is irrelevant – the employee must be employed for a period of two years, minimum, for any restrictive covenant to be enforceable. Moreover, the court found that it doesn't matter whether the employee resigns or is terminated by the employer--if the term of employment doesn't hit the magic two year point, the covenant fails for lack of consideration (again, assuming there has been no money payment to support the covenant).

This decision ought to scare the living daylights out of most employers who rely on non-competes to protect their trade secrets, intellectual property and business good will. For one thing, it means that there needs to be a special compensation or benefits sweetener added to any non-compete agreement, whether offered at the beginning of employment, or later, to provide any meaningful protection. Otherwise, an employee could sign the non-compete agreement, get a better offer from a competitor two months later, and resign, with no fear of enforcement at all. The decision categorically ignores the distinction between an employer and employee adjusting their offer and counter-offer in negotiating for a job (presumably, the non-compete's value is factored into either the terms of employment or some other aspect of the job offer) and the additional consideration needed to support a contract signed after an employee is hired.

This case looks like one that should be appealed to the Illinois Supreme Court, but may simply be allowed to languish. For employers in Cook County and the Chicago area, this is a very troubling result, and one that probably cries out for some type of legislative fix.

Monday, July 1, 2013

Beer Dispensers at Work--What Could Go Wrong?

If this is in fact a trend, then I'm going to have to rethink my entire sexual harassment prevention training program.

The ADA and Corporate Wellness Programs

Earlier this year, the EEOC issued an opinion letter relating to the application of the Americans with Disabilities Act to corporate wellness programs.  An employer asked for an EEOC advisory opinion as to whether its proposed policy of providing financial incentives for employees who successfully participate in the program would be affected by the ADA accommodation provisions.  The plan had a specific provision benefiting employees who demonstrated that they took their medicine 80% of the time.

As you can see from the letter, the EEOC found that an employer would have to make, or at least offer, accommodations to employees who were somehow unable to meet the requirements of the program  because of a qualifying disability.  The Commission's position is consistent  with HIPAA's "reasonable alternative standard", which also aims to make employer health benefits incentive programs accessible to disabled individuals to the same extent as the programs are accessible to the rest of the workforce.

A couple of other key points:  because the Commission is obviously taking an expansive view of what constitutes a wellness program under its regulations, an employer should be prepared to face ADA challenges to those programs;  such wellness programs must be voluntary; and an employer may not penalize employees who do not participate (i.e. the employer can only offer a benefit).  Also note that the Commission is still being coy about whether offering a benefit for successful wellness program participation is in fact some type of penalty, or some other functional equivalent of a requirement to participate in the program.

This topic is only going to increase in importance, because under ObamaCare employers can increase the incentives for successful participation from 20% of the cost to 30%.  Cost incentives are even more significant for programs designed to reduce tobacco usage (up to 50%).  As employers move to put these programs in place, and allow their employees to escape at least some of the cost hikes implicit under Obama care, the accommodation question is going to come up more frequently.

Wednesday, May 22, 2013

An Important Loss for the NLRB in the D..C. Circuit

From my partner, Jim Hendricks:

On May 7, 2013, the U.S. Court of Appeals for the District of Columbia  rejected an NLRB rule published on August 30, 2011 which provided that  “. . . all employers subject to the NLRA (nearly 6 million employers) must post notices to employees, in conspicuous places, informing them of their NLRA rights, together with Board contact information and information concerning basic enforcement procedures . . .”  This ruling effectively kills the notice posting requirement unless the NLRB appeals the ruling to the Supreme Court.
The poster was to have been 11″ x 17″ and informed employees of their right to form, join, or assist a union, to bargain collectively through representatives of their choosing; to discuss wages, benefits, and other terms and conditions of employment with fellow employees or a union; to take actions to improve working conditions; to strike and picket; or to choose not to engage in any of these activities.  The poster also referred to items that were “illegal” for an employer to prohibit at work.  Conspicuously absent from the notice posting requirement was any statement that employees could decertify unions or not pay union dues in right to work states.
As an enforcement mechanism, the rule declared that an employer’s failure to post the notice was an “unfair labor practice.”  In addition, the rule allowed the Board to suspend the running of a six-month limitations period for filing any unfair labor practice charge under §10(b).  Further, the Board said the employer’s “knowing and willful refusal to comply with the requirement to post the employee notice as evidence of unlawful motive in a case in which motive is an issue.”
The Board attempted to justify its rule, citing its statutory “rule making” authority.    However, the Court of Appeals found the rule unlawful without addressing the Agency’s rule-making authority. The Court found that the posting requirement ran afoul of employer’s “free speech” rights found in the NLRA.    Relying on prior Supreme Court precedent, the Court found that §8(c) of the Act “expressly precludes regulation of speech about unionization “so long as the communications do not contain a threat of reprisal or force or promise of benefit.”  The Court concluded, in referencing the First Amendment, that “[t]he language of §8(c) explicitly covers more than just the  ‘expressing’ of the speakers views.  It covers as well the “dissemination” of “any views, argument, or opinion, “as long as the written, printed, graphic, or visual” material disseminated is not coercive.”  (29 U.S.C. §158(c)).
The Court concluded that the Board’s rule violates §8(c) “because it makes an employer’s failure to post the Board’s notice an unfair labor practice, and because it treats such a failure as evidence of an unfair labor practice, and because it treats such a failure as evidence of anti-union animus in cases involving, for example, unlawfully motivated findings or refusals to hire – in other words, because it treats such a failure as evidence of an unfair labor practice.
The ruling effectively brings an end to this particular rule-making effort, without Supreme Court intervention.  Because each and every decision of the NLRB is reviewable in the DC Circuit, the ruling pending in the Fourth Circuit is largely academic.  All employers can thank the National Association of Manufacturers and others for their efforts to bring the rule-making authority of the NLRB back to reality.  Employers vigorously attacked the NLRB poster rule as they have on the current Board’s attempt to establish “ambush elections,” which significantly shortens the time for representation elections monitored and conducted by the NLRB.
This decision by the D.C. Court of Appeals follows its January 25, 2013 (Noel Canning v. NLRB, (D.C. Ct. 2013) decision holding that two current Board members were unlawfully appointed by President Obama as “recess” appointments, rendering all decisions by this Board void.  That decision is currently pending appeal to the US Supreme Court.