LEGISLATIVE AND ADMINISTRATIVE
ACTION
House passes ADA Amendment Act. The
House has passed a bill that will expand the definition of “disability” to
make it easier for plaintiffs to qualify as disabled under the
ADA. The amendments were introduced to address U.S. Supreme Court
decisions that have strictly interpreted the disability definition
to disqualify many plaintiffs. The bill was first introduced by
Rep. Sensenbrenner (R-Wis). It now goes to the Senate, where there
is concern among employers that too broad a definition may render
virtually any condition, and all workers, eligible for accommodation
under the ADA. The proposed law defines disability as a condition
that “materially restricts” an individual, but there
is no definition or guidance provided for that term.
Employee Misclassification Prevention
Act will attack use of independent contractors. Businesses
are avoiding employment taxes and benefits by calling workers “independent
contractors” instead of “employees.” House
Bill 6111 has been introduced for the purpose of addressing
widespread use of independent contractors who do not actually
meet the legal standards of “independent.” This
bill would impose penalties for this sort of misclassification.
[Prior Legal Updates have also illustrated how the
use of independent contractors often backfires, costing businesses
millions in back pay and benefit liability.]
LITIGATION
The Legal Update includes new developments and matters
of interest throughout the United States. Be aware that our various
federal circuit courts reach differing conclusions. A decision
in another part of the country, and especially in a different state,
may not be “the law” in your jurisdiction. Some courts
lead the way; others lag behind. The Legal Update lets you see
the overall trends to compare them with your jurisdiction. Wisconsin
is part of the Federal Seventh Circuit (Wisconsin, Illinois and
Indiana).
Case of the Month
Electronic Privacy
Finance officer’s statements
overcome employer’s policy on right to monitor and
result in liability. The
City of Ontario, California had a detailed Electronic Communications
Policy clearly stating its right to monitor and read any
and all electronic communication of any type. The policy
also prohibited personal use of the equipment. However, when
the Finance Officer found that some police officers were
exceeding the text message guidelines on number of characters
per month, he informed them that as long as they personally
paid for any overage, he would not review the messages to
see whether they were official or personal. The Finance Officer
did not want the extra review work; as long as the money
was paid, the budget would be okay, and he had no further
concerns. So, police officers paid for the overages for several
months. Then the Police Chief found out about the ongoing
overuse of text messaging and decided to use the City’s
policy to review the contents. He found a lot of personal
use, with a number of sexual texts. The officers whose texts
were read sued for unreasonable search under the Fourth Amendment.
The court ruled for the police officers because the Finance
Officer’s statements and practice of just collecting
for the overages had overcome and nullified the City’s
policy. The Finance Officer’s actions had created a
reasonable expectation of privacy in the content of the text
messages and created employer liability for violation of
that privacy. Quon, et al. v. Arch Wireless Operating
Company and City of Ontario, et al. (9th Cir., 2008).
[This case is a good warning of how a manager’s focus
on his own operation and priorities can destroy an entire
organization’s policies and create liability for other
managers in a much broader scope.]
Discrimination
Age - Supreme Court
Employers bear burden to show layoff
criteria were reasonable. The
U.S. Supreme Court issued a decision that could significantly
impact layoff decisions. In Meacham v. Knolls Atomic
Power Laboratory, the Supreme Court ruled that when
an employer makes an employment-related decision that disproportionately
negatively impacts older workers, the employer bears the
burden of persuasion to show that its action was based on
reasonable factors other than age.
In Meachem,
the employer determined who to lay off by scoring employees on “performance,” “flexibility,” “critical
skills” and length of service. Although none of the criteria were, on
their face, age-linked, 30 of the 31 employees laid off were at least 40 years
old. The laid-off employees sued, claiming that the employer’s criteria
had a disproportionate impact on older workers.
The employer
argued that its criteria fell within the ADEA exemption stating that it is
not unlawful age discrimination for an employer to take an adverse action against
employees where differential treatment is based on “reasonable factors
other than age” (“RFOAs”). The employer argued that as long
as it produced evidence of RFOAs, the burden fell on the employees to prove
that the RFOAs were not reasonable. The employees’ counterargument was
that the employer carries the ultimate burden to persuade the court that its
factors were reasonable.
The Supreme
Court sided with the employees, ruling that when an employer uses the RFOA
affirmative defense, the employer bears the ultimate burden of proving reasonableness. Meacham heightens
the burden on employers preparing for employee reductions to carefully assess
their retention strategy and factors they will use when determining layoffs.
Employers are cautioned to carefully review the overall numbers of a lay off
to determine whether the criteria being used might have inadvertent, negative
impacts on protected groups of employees.
Sex
Over-the-edge policy is discriminatory
for female construction crane operators.
A company’s construction cranes do not have restrooms,
and it took far too long to take a break, go clear down the
crane and back up. Crane operators were directed to just
go to the railing at the edge and urinate over the side.
This policy was dangerous, or impossible, for female operators.
It also required the women (unlike men) to substantially
remove work pants and undergarments in full public view.
A federal court concluded that the policy had a “significant
discriminatory impact on women.” The policy created
a safety and privacy issue that “adversely affects
the health of female employees, while leaving male employees
unaffected.” Johnson v. A.K. Steel Corp. (S.D.
Ohio, 2008).
Pregnancy Discrimination Act applies
to abortions. An employee’s
doctor recommended an abortion due to medical concerns. The
employee was fired five days after the abortion. There was
evidence of the company’s vice president making negative
statements regarding the abortion and of non-uniform, pretextual
enforcement of the attendance call-in policy used for the
discharge. The court ruled that abortion discrimination is
protected under the Act’s coverage of “pregnancy
and related medical conditions” and allowed the case
to proceed to trial. Doe v. C.A.R.S. Protection Plus,
Inc. (3rd Cir., 2008).
Retaliation
Kiss-and-tell results in retaliation
verdict for bikini contestant. The
Chairman of the Board for a public youth agency saw one of
the agency’s receptionists competing in a local bikini
contest. He approached her and gave her a kiss (he aimed
for her lips but she turned her head). She then told a co-worker
that she was not offended but was surprised by the Board
Chair’s behavior. When the story filtered up, higher
management became concerned about the “politically
sensitive” nature of the incident. There was concern
the receptionist might become a witness in a sexual harassment
case. She was then given stern warning about her off-the-job
interaction with Board members. She complained about this
and was subjected to “a baseless and inappropriate
level of disciplinary actions detrimentally affecting her
future employment in state service.” The evidence
showed a manager singled her out and trumped up charges for
discipline in order to force her to leave and “get
her out of the way” of any investigation of the agency
or the Board Chair. A jury awarded $156,000 under the California
Fair Employment Act. Steele v. Youthful Offender Parole
Board (Cal. Ct. of App., 2008).
White police officers awarded $10
million. Three White officers
openly opposed racist mistreatment and bias directed toward
their African American co-workers. The City settled a race
discrimination suit brought by the African American police
officers. Then the White officers who had spoken out against
the discrimination were subjected to retaliatory harassment
by other officers and supervisors. They sued the City and
nine other personally-named officers and supervisors under
Title VII and 42 U.S. Code §1983. A jury awarded the
three officers respectively $5 million, $3 million and $2
million. (The City had made a pretrial settlement offer of
$10,000.) Moore, et al. v. Philadelphia (E.D., PA,
2008).
Disability
Stereotyped perceptions result in
case. The EEOC has sued
on behalf of a class of rejected job applicants. A medical
provider required pre-employment health screenings for nurses
as authorized under the ADA. It then withdrew the job offer
to anyone who tested positive for latex allergy, on the presumption
that this could create a life-threatening adverse reaction
for nurses required to wear rubber gloves. However, it made
no individualized assessment, as required by the ADA. Many
of those rejected had worked for years without any effects
whatsoever; the “positive” never resulted in
any actual issue. The EEOC has filed a “perceived as
disabled” lawsuit. EEOC v. John Muir Health (N.D.
Cal., 2008).
Medical condition does not justify
credit card abuse. A fired
employee lost her disability, sex and race discrimination
case. While on medical leave, she used the business credit
card for $8,350 in personal cash advances. She could identify
no one of a different gender or race who had not been fired
for such an infraction. Her argument that she was in financial
straits “due to her disability” (carpal tunnel)
was not a viable reason under the ADA to excuse the embezzlement. Woods
v. U.S. Postal Service (N.D. Texas, 2008).
National Origin: Unequal Pay
Immigration Nursing Relief Act case
results in $1 million award in Department of Labor suit against
nursing home. A nursing
home chain was found to have paid 119 nurses it recruited
from the Philippines less than its U.S. citizen nurses doing
the same work. No limit on back pay. The INRA has
no statute of limits on how far in the past back pay may
be awarded. No complaint necessary. The nursing home
also lost its argument that the DOL had no jurisdiction,
since none of the nurses or any other “aggrieved party” had
filed any complaint. DOL had self-initiated the case based
on a “tip.” The court ruled that nothing in
the statutes keeps the DOL (or most other federal agencies)
from acting independently to assure that employers follow
the law. Alden Mgt. Services v. Chao (7th Cir.,
2008).
Sexual Orientation: Benefits
No same-sex benefits for Michigan
public employees. A state
supreme court ruled that Michigan’s 2004 constitutional “marriage
amendment” bars public employers from providing same-sex
insurance benefits to employees. The amendment provides that
the benefits of “marriage or similar union” shall
be provided only for “the union of one man and one
woman.” Presumably under the amendment, those benefits
can still be provided to unmarried heterosexual “domestic
partners” who have a “similar union” to
marriage. National Pride at Work v. Gov. of Michigan (Mich.,
2008). [Interestingly, the Governor of Michigan, Jennifer
Granholm, supported the same-sex benefits. The Governor
had to be named as the official executive for purposes of
suing the state to challenge the amendment.]
Constitution: Equal Protection
Ex-lawyer’s 13 felony convictions
bar him from teaching job. An
attorney named “Crook” lost his law license due
to multiple felony convictions, including the crime of creating
groundless and frivolous cases in order to generate fees
for himself. He then obtained a teaching certificate, and
later sued a school district that refused to hire convicted
felons as teachers. He alleged violation of 42 U.S. Code §1983
Equal Protection rights and conspiracy under §1985.
The court found his claim groundless. The school district
had a “rational basis” to consider “good
moral character” and background as a qualification
for its permanent teaching positions. Crook v. El Paso
Independent School District (5th Cir., 2008).
Fair Labor Standards Act
Wishful thinking is not a good defense. Once
again, the courts have ruled that giving someone a salary and “manager” title
does not create an exempt position. Failure to analyze the actual
job duties resulted in a finding that 26 grocery “managers” did
not meet the executive exemption standards and were due two years
of overtime pay. The evidence showed the employees were “working
supervisors” rather than exercising true managerial duties.
In addition, the back pay award may be doubled for the company’s
intentional disregard of the standards. Rodriguez v. Farm Stores
Grocery, Inc. (11th Cir., 2008).
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