LEGISLATION/REGULATION
Personal information rules.
The Federal Trade Commission has issued new rules, effective now,
on destruction of sensitive employment data. The rules cover employers
of one or more employees. All personal data (including phone number,
address, Social Security number) must be properly destroyed when
the personnel files are purged. Penalties are $2,500 per violation,
and a former employee may also bring a private suit.
“Wal-Mart Bill” proposed to monitor Medicaid
usage. A bill has been proposed in Congress to
require states to report how many low-income workers are using
Medicaid and where they are employed. Dubbed the “Wal-Mart
Bill,” it is in reaction to the number of large companies
that provide no insurance and pay workers such low wages that
they are eligible for Medicaid. Wal-Mart is one of the largest
such employers, yet fewer than 50% of its workers are insured.
Figures from 15 states show that Wal-Mart employees are the
biggest users of taxpayer-funded health care and 26% of the
nation’s uninsured work for companies with 500 or more
employees. The bill’s sponsors claim that the taxpayer
is providing welfare to Wal-Mart, subsidizing large companies,
and more than wiping out any “low price savings” the
taxpayer gets at the checkout counter.
Green card process changes. The Immigration
Service has announced a new process for obtaining permanent resident
cards (green cards). All applications must now be mailed to one
central processing facility in Los Angeles. The change is expected
to speed the process.
DEVELOPMENTS
Hurricane Katrina creates legal morass.
The hurricane which caused loss of life, personal injury and property
damage will also have major legal effects. Federal and state courts
report a massive loss of legal records. The records of thousands
of cases have been flooded and destroyed. Law firms in the affected
area report the same major losses. Many legal records and items
of evidence are not electronic and cannot be recreated. The ability
to either prove, defend or appeal numerous pending civil and criminal
cases may have vanished. This creates a massive legal limbo. The
post hurricane litigation, which is likely to be astronomical,
will be further complicated by this destruction of the courts’ records.
LITIGATION
Case of the Month
Federal courts split over release of FMLA rights -
Separation and Release Agreements may not be enforceable.
The 4th Circuit Court of Appeals has ruled that only a court
or the Department of Labor can approve a release of an employee’s
FMLA rights. An employer-employee Severance Agreement or Separation
and Release Agreement is not enforceable as to the FMLA. This
is opposite of what other courts, such as the 5th Circuit,
have ruled. In Taylor v. Progress Energy, Inc. (4th
Cir., 2005), an employee accepted a Separation and Release
Agreement that waived all liability under all employment laws
in exchange for $12,000. She took the money, then sued under
the FMLA. The court ruled the employee could keep the money
and still sue; the Agreement did not affect her FMLA rights
due to the court’s interpretation of the FMLA regulation
sec. 855.220(d) that only a court or the Department of Labor
could authorize such a waiver. This split of opinions between
circuits will eventually lead to Supreme Court cases to decide
the matter. Until then, be aware that a Release Agreement may
not be effective for FMLA issues.
Family and Medical Leave Act
Trip to get car for pregnant wife is not covered under
FMLA. An employee lost his FMLA case. The family
car died, so he took a several-day trip to get another car
he owned and drive it from Atlanta to Seattle so that his wife
and expected child would have the “care” of safe
transportation. While he was gone, the wife’s sister
stayed with her, but the husband did call home daily to “provide
psychological comfort.” The court ruled that “care” under
the FMLA must be directcare; it must involve an amount of “presence” and
direct interaction. Though travel time to give direct care
of a family member is covered, going awayfrom the family member
on a collateral trip is not providing FMLA care. Tellis
v. Alaska Airlines (9th Cir., 2005).
Privacy
Demand a raise - get fired. A male manager
demanded a raise. He believed that women were favored, and presented
evidence that his pay was discriminatorily low. The evidence he
produced was records of the salaries and fringe benefits of female
employees. Rather than getting a raise, the manager was fired for
violating confidentiality rules. The court ruled that using confidential
information for personal purposes was a serious violation that
warranted discharge, regardless of the manager’s underlying
concern about discrimination. Cepero-Rivera v. Fagundo (1st
Cir., 2005).
Not all on-the-job activity is job related; employee
was outside scope of employment. An employer
was successful in getting dismissed from a privacy case by
showing that though the invasion of privacy occurred on the
job, it was not job related. A health care lab technician accessed
the medical records of her ex-husband’s current wife
and then revealed details to the ex. This resulted in suit
of the lab technician personally, and her employer for breaching
the laws requiring privacy of medical information, negligent
supervision, and failure to maintain proper standards of care.
The court ruled that the medical technician was acting outside
the scope of employment for a purely personal purpose.
The technician’s actions had no benefit to the employer;
the technician had no intent of “serving” the employer
when she accessed the records. Thus, the employer could not
be held liable. Korntued, et al. v. Advanced Healthcare,
S.C. (Wis. Ct. App. Dist. 1, 2005).
Records Policy. An important consideration in this case was the
company’s policy on confidentiality of patient records. The
policy expressly forbade looking at records of family members or
others out of curiosity or for any other non-job-related reason.
The policy was signed by all employees, including the medical tech.
This illustrates the growing importance of having some “key” policies
signed individually, with a copy in the personnel record.
Discrimination
Race/National Origin
Westernizing name is race/national origin harassment.
In El-Haken v. BJY, Inc. (9th Cir., 2005), a case under
42 U.S. Code Sec. 1981, the court found “pervasive harassment.” A
company CEO decided that an employee’s name “Mamdouh” would
come across better to clients as “Manny.” The CEO believed
that a “Western name” would increase the employee’s
chance of success and be more “acceptable.” In spite
of the employee’s repeated objections, the CEO persisted
in calling him Manny and referring to him in company meetings,
correspondence, etc., at Manny. The court ruled that though not “severe,” the
behavior was “pervasive” and constituted discriminatory
harassment. [Unlike Title VII, 42 U.S.C. Sec. 1981 can carry
personal liability as well as corporate liability. Race/national
origin suits can be brought for four years under Sec. 1981 vs.
the Title VII 300-day statute of limitations, and there are no
damage “caps” under Sec. 1981.]
“Same actor” defense defeats Norwegian
bias claim. An employee claimed that a fishing
company discriminated against him because he was not Norwegian.
The U.S. company was a subsidiary of a Norwegian corporation
and had a number of Norwegian managers. When the non-Norwegian
employee was demoted to Mate and a Norwegian made Boat Captain,
he sued. The court found (1) no overt evidence of national
origin bias or favoritism, (2) the manager who made the demotion
decision was the sameperson who had previously promoted the
plaintiff, twice. There is a strong legal inference that if
a manager hired or promoted a person, knowing their EEO categories
at the time, it is unlikely that same manager’s subsequent
decisions would be based on those same EEO categories. Absent
tangible evidence, the same actor inference is a valid
defense to defeat a claim of discrimination. Coghlan v.
American Seafoods Co. (9th Cir., 2005).
Disability
Accommodation must include reasonable resources.
An employer lost $207,000 for failure to reasonably accommodate
a manager with post-polio syndrome. The company originally agreed
to reasonably accommodate the employee by allowing her to work
from a home office. However, the company did not reasonably follow
through to provide adequate office equipment, an adequate computer,
and took “several years” to provide proper phone connection
to the company’s network. This was particularly unreasonable
since the employer was in the business of providing that service.
The jury originally awarded an extra $1.5 million, but the
judge decreased the amount. Smith v. Bell Atlantic, et al. (Mass.
App. Ct., 2005).
Fear of re-injury does not require accommodation.
An employee was given light duty to recuperate from a back injury.
Then an independent medical exam (IME) determined that he could
perform all job duties. However, the employee refused to perform
the duty which had caused the injury, out of concern that it would
cause re-injury. He was offered a lower paying job, without that
duty, but refused, then resigned and sued under the ADA. In dismissing
the case, the court found: (1) that the employee refused to perform
an essential function of the job, (2) temporary light duty does
not “convert” the job to require the accommodation
of permanent light duty; “facilitating injured workers returning
to their jobs should not expose employers to future litigation,” (3)
an employee’s personal fear of injury does not outweigh a
medical evaluation of fitness for duty. Rooney v. Koch Air
LLC (7th Cir., 2005).
Retaliation
Car dealership’s timing loses retaliation case.
An employee was fired just ten days after she complained about
sexual and racial harassment. The court ruled that the timing seemed
suspicious. The reason also seemed suspect. She was fired for personal
phone use. However, there was evidence that dealership technicians
had falsified repair orders during the same period (an even more
serious infraction), and were not discharged. The employee was
awarded $75,000 under the Texas state anti-discrimination law. Fisher
v. Ancira Enterprises, Inc. (Texas Ct. App., 2005).
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