Regardless of the type of employer you are, you depend, on some level, on customers who are willing to pay for the goods or services being offered.  And the old adage, “The Customer is Always Right,” a mantra of the American business community since this country’s founding, is as true today as it was then.  But from time to time, valued customers will step over the line and act inappropriately towards company employees.  If and when that occurs, employers need to understand the legal ramifications of dealing with the fallout.

Recently, a receptionist at a New Jersey automobile dealership brought an action against her employer for violation of the New Jersey Law Against Discrimination.  In the Complaint, she alleged, inter alia, that her employer retaliated after she pressed charges against a high-profile customer who had tugged at her shirt and exposed her bra.   Thereafter, she alleged that her work environment became hostile until she was terminated.

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This case has been up to the Appellate Division in New Jersey, who ruled that the employer is not responsible for the conduct of a non-employee, and will not be held responsible for customer conduct under most circumstances.  However, the Appellate Division did find that an employee filing charges against a customer is a protected activity that protects and individual against employer retaliation.

The upshot of the case is that in the rare case that customer behavior crosses over the line of good taste, take immediate measures to correct the situation.  In the even rarer case that the conduct becomes criminal, let your employees know that if they choose to press charges, they will not the subject of retaliation in any way, shape, or form.

Last Friday, my colleague Alexander Leonard, reported that Massachusetts had just passed a sweeping gender equity law that would prohibit employers from asking applicants about their past salary history.  Days after the Massachusetts law was signed by Governor Baker, the New York City Public Advocate Letitia James introduced a similar bill.  We wonder if laws like these will be become part of a new grassroots movement that produce a lot of patchwork laws like sick leave laws have been in the last few years.

The proposed bill has 6 co-sponsors and was designed to implement one of the policy recommendations from Ms. James’ April 2016 pay equity policy report.

If passed, it would be illegal for NYC employers and employment agencies to ask about any applicant’s salary history or benefits.  Employers and employment agencies could not get around this law by conducting public record searches on applicants.  Finally, the law would make it illegal for employers to rely on salary history to determine an applicant’s salary.

Employers have long asked applicants about their salary history in an attempt to find the appropriate salary to offer a candidate. This is done both to save money for the employers, but just as often to insure that a previous salary is at least being matched with the new offer.

Massachusetts’ law does not go into effect until January 2018.  If New York City’s law passes it will likely be effective before Massachusetts’ law goes into effect.  This means that New York City employers won’t have the benefit of seeing how this law will affect the interviewing and hiring process.  Questions remain as to whether laws such as this will in fact close the gender pay gap or will simply make the hiring process more time-consuming and drawn out as employers struggle to hit on the appropriate compensation to get candidates to accept job offers.

We will keep an eye on this one.

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On July 29, 2016, Governor Bruce Ratnor signed the Child Bereavement Act into law.  The Act requires employers with 50 or more employees to provide up to 10 working days of unpaid leave to employees to:

  1. attend the funeral or alternative to a funeral of a child;
  2. make arrangements necessitated by the death of the child; or
  3. grieve the death of the child.

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Bereavement leave must be completed within 60 days after the date on which the employee receives notice of the death of the child.   Further, employees requiring leave must provide employers with at least 48 hours’ advance notice of the employee’s intention to take bereavement leave, unless providing such notice is not reasonable and practicable.

The law defines employer as it is defined under the Federal Family and Medical Leave Act, which provides that employers are covered employers if they have 50 employees located anywhere in the U.S.  However, the law also defines eligible employees as is defined in the FMLA.  Thus, in order to be eligible for leave employees must have worked at least 12 months for the employer, worked at least 1250 hours in the last 12 months, and work in a location with 50 or more employees within a 75-mile radius.

The law does not define “child” as the FMLA does so employees will be able to take this leave regardless of the age of their children.

Employers may require reasonable documentation to demonstrate the need for leave.  Such documentation can include a death certificate, a published obituary, or written verification of death, burial, or memorial services from a mortuary, funeral home, burial society, crematorium, religious institution, or government agency.

If an employee tragically suffers the death of more than one child in a 12-month period, an employee is entitled to up to a total of 6 weeks of bereavement leave during the 12-month period. Although the Act provides for unpaid leave, if an employee has paid leave (including family, medical, sick, annual, personal, or similar leave) from employment, the employee may elect to use paid leave for bereavement leave.

Finally, the law provides that it is not meant to increase the total amount of unpaid leave the employee can take under the FMLA.  This seems to mean that if an employee has exhausted his or her 12 week FMLA entitlement, that he or she will not be permitted to take bereavement leave.

The law was effective immediately so, if employers have not already updated their leave policies, we encourage you to do so.

As my colleague Christina Stoneburner wrote earlier in the week, we aren’t even through summer 2016, yet the number of new employment laws and regulations enacted that employers must contend with are already piling up.  Massachusetts recently joined the fray, with Governor Baker signing into law earlier this month S.2119 (effective January 1, 2018), which addresses pay equity discrimination based on gender.  Notably, the new pay equity legislation reiterates what Massachusetts and federal law have long stated: pay disparities based on gender are unlawful.  However, this new law goes further, is more employee-friendly than ever, and specifically addresses neutral conduct that arguably affects gender pay equality.

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One unique and notable component of the new law is a first-of-its-kind “ban the box” type prohibition that makes it unlawful to inquire regarding the prior salary history of prospective employees (similar to the prohibition of criminal conviction questions that many jurisdictions have recently adopted). Questions about prior salaries are extremely common and can be found on most employment applications.  However, this practice must now be eliminated in Massachusetts.  The intent of the legislature is to root out historic pay discrimination by forcing pay decisions to be made based on the job and not prior salaries.  The law prohibits, any time prior to making an offer of employment (with salary offer), either directly requesting prior salary information from the prospective employee and/or his or her former employers, or indirectly researching the same.  Moreover, employees cannot be prohibited from discussing their wages amongst themselves (although such policies are already prohibited by current interpretations of the National Labor Relations Act).

In addition, the law reiterates that actual pay differences based on gender are expressly prohibited where employees are engaged in “comparable work,” which is defined as any job(s) (regardless of titles) that require “substantially similar skill, effort and responsibility . . . under similar working conditions.”  Moreover, the law clearly delineates the few bona fide non-discriminatory reasons allowed for neutral pay policies, namely: (i) seniority pay systems, (ii) merit pay systems, (iii) production or sales quality/quantity pay systems, (iv) geographic differences, (v) job relevant education, training, and/or experience, and (vi) job related travel.  Lastly, the statute contains an anti-retaliation provision that prohibits taking retaliatory action against employees or applicants that oppose practices prohibited by the law.

An action enforcing the statute may be brought within three years of any discriminatory act, either by the attorney general or through civil litigation by the affected employee(s) and/or applicant(s), including but not limited to by class action.  Damages recoverable include any owed or diminished wages and benefits, as well as additional “liquidated” damages (which doubles any owed compensation) and any reasonable attorneys’ fees and costs.

The one piece of good news for employers is that an affirmative defense is provided in the statute where an employer, within the prior three years, conducts a good faith self-evaluation of its pay practices in order to eliminate pay discrepancies based on gender. As a result, it is recommended that prior to the effective date of the act that employers conduct a thorough review of all employee handbooks, non-disclosure agreements, employment applications, and other new hire policies and forms, as well as review institutional pay structures and systems, to ensure compliance with the law.  As always, your friendly Fox Rothschild attorneys are here to help in this regard.

 

I know what you’re thinking, it’s not even September yet.  I’ll worry about January sometime in December.

The beginning of the year may seem like a long way away, but it can sneak up on you.  I often have employers who are scrambling at the end of the year to understand legal changes and to update policies to insure compliance.

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In the spirit of getting ready to go back to school, we thought we’d start educating employers now of the changes to come and laws that are effective on January 1, 2017.  We will periodically update the list and try to do an overall round-up in December of laws going into effect in January 2017.

1.   FLSA exemption rules.  The biggest sea change on the legal landscape is the revised definition of the salary test under the Fair Labor Standards Act.  In order to be exempt employees, employees must meet the salary test and perform exempt job duties.  The final rule settled on the new weekly salary of $913 (or $47,476 per year), which is a significant increase over the old threshold of $455 per week.  Employees must earn at least $913 in salary (may include certain bonuses) per week or they cannot be considered exempt employees regardless of whether they perform exempt job duties.  More details can be found here in the Firm’s alert.  Be warned, however, that the effective date of this rule is December 1, 2016;  it is such a big deal that we wanted to include it here.

2.   Connecticut Ban the Box.  The Fair Chance Employment law was signed in June 2016 and is effective January 1, 2017.  The law prohibits employers from inquiring about an applicant’s criminal background history on an employment application.  There are two exceptions to the rule and employers may ask questions about criminal history on applications where: (1) required to do so by law; or (2) a security or fidelity bond or equivalent bond is required for the position.  In addition, employers may not at any time ask about criminal records that have been “erased” by statute.

Employers should review application forms to remove any objectionable questions.  Where employers are permitted by statute to ask about criminal backgrounds on an application, the employers must include a clear disclaimer that applicants are not obligated to disclose erased records and must advise what records may be subject to erasure.  Employers must also advise that where a criminal records has been erased, the applicant will be deemed to have never been arrested.

Employers must also insure that portions of applications that disclose criminal backgrounds can only be viewed by HR personnel, or where there is no HR, the person in charge of employment and any person involved in interviewing the candidate.  There are limited exceptions to the disclosure rule as may be required by FINRA, for an insurance producer, or the FDIC Act.

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This week, the EEOC officially opened its EEO-1 survey process for 2016.  The EEO-1 form requires employers who meet qualifying thresholds to provide certain data about their workforces (e.g., race, ethnicity, gender, job classifications/categories, etc.) to the EEOC.

Who must comply?  1) Private employers with 100 or more employees; 2) private employers with fewer than 100 employees, if the company is owned by/affiliated with another company such that the enterprise employs 100 or more employees; and 3) certain prime and first-tier subcontractors of the federal government who have contracts totaling $50,000 or more.

You may be thinking to yourself:  Self, this seems like a lot of complicated paperwork, and I am not going to do it.  There are (at least) three excellent reasons why you should!

First, it’s required by law.  If your business meets one of the thresholds above, both Title VII itself and federal regulations require you to complete the EEO-1.  Failing to complete the EEO-1 may well result in the EEOC going into federal court to compel your compliance.

Second, it’s not (technically) paperwork.   The EEO-1 is submitted electronically (unless your business faces what the EEOC calls “extreme circumstances where Internet access is not available” and gets EEOC permission to submit paper forms).

Third, EEOC uses the data generated from EEO-1 as part of its ongoing enforcement efforts — for example, analyzing employment patterns within particular industries, regions, etc.  Providing the required data, in theory, helps the EEOC to make these decisions and analyses with a more accurate picture of the workforce.

September 30th is the filing deadline.  Have questions?  See the EEOC’s FAQ page on the EEO-1 process here.

3324553_s Yesterday, the U.S. Seventh Circuit Court of Appeals affirmed a lower court ruling holding that Title VII does not prohibit employment discrimination on the basis of sexual orientation.  The case involved a lesbian part-time employee, who alleged she was deprived of the opportunity for full-time employment and was not promoted due to her sexual orientation.  After losing her case at the District Court level, the employee appealed to the Seventh Circuit.

The Seventh Circuit noted its hands were tied in the matter:

Since Hamner and Spearman, our circuit has, without exception, relied on those precedents to hold that the Title VII prohibition on discrimination based on ‘sex’ extends only to discrimination based on a person’s gender, and not that aimed at a person’s sexual orientation.

In affirming the decision, the court also pointed to the fact that Congress had not amended the law to include sexual orientation and the fact that the Supreme Court has not established precedent extending Title VII protections to employees on the basis of their sexual orientation.

While Title VII does not expressly include sexual orientation as a protected characteristic in its ban against employment discrimination, your faithful blog authors have discussed a number of legal theories under which LGBT employees have sought relief.  We have discussed the sex stereotyping theory, i.e., the idea that an employee’s failure to conform to gender stereotypes or norms may be actionable for LGBT plaintiffs under Title VII.  We have also discussed what might be called the “referential” theory, under which the EEOC has argued that sexual orientation cannot be understood as a distinct concept from sex, and that sexual orientation discrimination is therefore sex discrimination by definition.

Absent congressional action or Supreme Court guidance, employers continue to face some uncertainty as to the viability of these kinds of claims — which some courts may find persuasive.  In light of this uncertainty, employers should consider doing three things:

  • Remember that even if not covered by Title VII, sexual orientation may be a protected characteristic in employment under state, county, local law, or executive order — depending on the jurisdiction(s) where a business operates
  • Proactively develop policies and procedures to prevent sexual orientation discrimination in the workplace, even in jurisdictions where it is not a protected characteristic
  • Continue to monitor these legal developments and discuss them with legal counsel

A workplace of any significant size is bound to be full of individuals who are a little off the beaten path, so to speak.  While an employer will need to deal with the quirky dispositions of some workers, on occasion an employee’s behavior will cross over from merely quirky  to disturbing.

The first step towards addressing the issue is a fitness for duty exam.  These exams, which are typically conducted with licensed medical professionals, evaluate whether an employee is physically or emotionally appropriate for their position.  But this is complicated by the fact that disturbing behaviors often are due to psychiatric and emotional conditions, which are covered as disabilities under most state and federal discrimination laws.  If an employee has such a disability, an employer may require a fitness for duty exam only if the exam is job-related and part and parcel to a legitimate business necessity. This standard will generally be met if the employer has a reasonable belief that either a) the employee’s condition may prevent the employee from performing the job’s essential functions, or b) the employee poses a direct threat to his or her own safety or the safety of others.

This past week, an Illinois appellate court found for the employer in such a situation where an employee was observed in an office talking to herself and sending cryptic emails to coworkers.  The employee, who clearly suffered from an emotional infirmity that would be covered by the ADA, was sent for a fitness for duty examination with a mental health professional.  The employee then sued, arguing that the examination was a violation of the ADA.

If confronted with such a situation, employers should immediately engage with an employee for more reasons than just legal.  After assessing the situation, including gathering any pertinent documentary information, an employer should weigh the two questions above and err on the side of caution if an evaluation is necessary.

It should also be noted that this analysis is also applicable to physical challenges in positions that include manual labor.

Taking early intervention with respect to a possibly troubled employees can be a proactive step towards preventing workplace violence and improving efficiency.

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We are honored to have been named by Working Mother Media and Flex-Time Lawyers as one of the 50 best law firms for women.  This is the fourth time we have been named to the list.

Our Firm works very hard to insure the advancement and retention of all attorneys, but we do have targeted initiatives, such as our Women’s Initiative, to focus on female attorneys. The Women’s Initiative, along with the Diversity Committee, serve as resources and advocates for minority lawyers at the Firm.

Diversity initiatives such as these can have many positive impacts on companies, including improving employee morale, decreasing discrimination charges, and reducing employee turnover. Studies have also shown that having a diversity program improves a companies bottom line and can increase customer-base as customers seek to find business partners whose work forces match theirs in terms of diversity.

Diversity programs are not without critics, however.

Employers who are thinking about setting up diversity initiatives do need to be careful that they are not exposing themselves to claims of reverse discrimination.  One of the keys to this is insuring that all employees, regardless of whether part of the majority or minority, understand the importance of these initiatives for the company as a whole.  Another key is to consult with employment counsel as to the lawful interest groups that can be established without violating discrimination laws.

Employers who are looking for some practical suggestions as to human resources policies that help manage diversity can also review the EEOC’s Best Practices of Private Sector Employers for suggestions.

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A Colorado federal judge recently ordered the City and County of Denver to pay $1.67 million to job applicants who alleged that Denver’s employment screening tests had a disparate impact on black and Latino applicants.  The class action was tried in an 8-day bench trial in April 2016 after Judge Krieger denied summary judgment.

Denver used ACCUPLACER tests published by College Board as pre-placement tests.  The tests were developed to place students in college-level courses and were not validated for use in making hiring decisions.

This case is a rather expensive reminder that any type of employment test must be validated for employment purposes.  The EEOC has issued guidance on the use of employment tests that provides some best practices for employers to follow.

The most important thing to think about is whether the test is really job-related.  In other words, does the test actually relate to job skills that are required for the job?  Then, the test must also be checked to insure that it does not have a disproportionate impact on any protected class.

Employers who have tests validated once cannot simply assume that the test is safe to use in perpetuity.  If job duties or skills have changed for the position for which the test is being administered, then the test should be re-validated.

Finally, employers should not just assume that because a test is simple it does not need to be validated.  Even a simple math test given to applicants who may handle money would need to be validated.