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It seems that every day we are hearing something about investigations involving the White House.

Whether it is the investigation into Russia’s hacking of the election that has resulted in the indictment of suspected Russian spies or President Trump’s call for an investigation into whether he was wiretapped, it seems everyone wants an investigation.

Such calls for investigations bring up other questions — should there even be an investigation, who should do the investigation, when the investigation should start, and when should the investigation end.  These are all questions faced by employers when addressing employee complaints.

It may not be fair to compare investigations into employee conduct to Congressional hearings or law enforcement investigations, but employers can learn a lot from those investigations.  In later posts, we’ll get into pitfalls of a poor investigation, but for now we are focusing on whether an investigation is necessary.

Employers frequently face complaints from employees of varying degrees of credulity and proof.  What does an employer do with the “crazy” or unsubstantiated complaint?

Let’s look for example at President Trump’s recent tweets about alleged wiretapping.  Those are pretty sensational claims, that, if true, mean members of the Obama Administration violated the law.  Based on what we know now, the complaint appears to be unsubstantiated by any proof.  Instead, as the White House calls for others to come forward with that proof, it appears that the allegations are based on untrustworthy sources or the President’s bare belief.  This is not that dissimilar from an employee who claims that he or she has been discriminated against based on a “feeling.”

Employers are often tempted to stop the investigation at this point.  After all, if the employee cannot come forward with any proof, then why should the employer waste resources continuing the investigation?

There are two very good reasons to continue.  First, although the employee cannot articulate proof, the employee’s feeling may actually be correct.  In those cases, stopping the investigation early means that a problem will not be uncovered and resolved, leading to much greater liability in the future.

The second reason is for the integrity of the complaint process.  If employees feel that their complaints are summarily dismissed without any investigation, those employees will believe that filing a complaint is fruitless. Those employees are likely to tell others not to complain because the company does not take complaints seriously.  Once that happens, employees who file complaints in court before filing any internal complaints will have an argument against the employer’s affirmative defense that the employee failed to use the internal complaint procedure.

So, the lesson is, even if the complaint seems to be a waste of time, devote some time to investigating it.  Just how much time to invest will be the subject of a future post.

 

 

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A notable case caught our eye recently coming out of the United States District Court for the Middle District of Florida filed by the Equal Employment Opportunity Commission (“EEOC”). Namely, The EEOC sued CRST International, Inc. (“CRST”) claiming that it, among other things, violated the Americans with Disabilities Act (“ADA”) by failing to accommodate and retaliating against a prospective truck driver.

The new driver allegedly requested the use of a prescribed emotional support animal to mitigate post-traumatic stress and mood disorder. CRST purportedly told the new driver simply to leave his dog at home and refused to provide an accommodation, citing unbendable company policies, and effectively rescinded his employment offer. Unfortunately, usually these policies must bend, or at the very least the possibility explored.

While the CRST case is in its early stages, and no court decisions have yet been issued, this complaint serves as a great illustration of just how far reaching the disability discrimination laws are. Here many employers would scoff or summarily dismiss the seemingly unworkable request of having a service animal in a trucking business. However, the CRST complaint reminds us of the potential disability accommodations that employers must consider and make. Regardless of the nature of the requested accommodation, the employer is, at the very least, required to engage in the interactive process with the employee and determine what, if any, reasonable accommodations can be made. Otherwise, you may end up on the wrong side of an EEOC lawsuit alleging ADA retaliation and failure to accommodate.

Please remember that when an employee or prospective employee requests a workplace disability accommodation in order to perform his or her job, an employer generally must consider the accommodation and, if it can be implemented without undue hardship, it must be granted. Anytime an accommodation request is received, never dismiss the request out-of-hand. Make sure to talk to your in-house human resources department or legal department, or involve outside counsel if necessary, to determine your legal obligations. Also, note that your state or local laws may provide additional protections beyond the ADA.

Copyright: andreypopov / 123RF Stock Photo

As my colleague Raquel Gutierrez warned last year, proposed wage payment regulations were set to become effective March 7, 2017. These regulations, created by the New York Department of Labor (“NYDOL”), would have caused new compliance headaches for New York employers. The proposed regulations placed specific notice requirements on employers to inform employees in writing of the methods by which they can receive wages. The regulations also would have implemented various restrictions with respect to payroll debit cards and direct deposits, most notably prohibiting certain financial services fees and requiring local withdrawal access. For the time being, employers needn’t worry about these proposed changes.

The New York Industrial Board of Appeals (“IBA”)—the intermediate administrative appellate body that oversees the NYDOL—has blocked implementation of these regulations by issuing a decision invalidating these proposed restrictions. The IBA found that the Commissioner of Labor overstepped her authority by, among other things, attempting to regulate issues that were truly the province of financial services regulations. For the moment, this alleviates at least one new administrative burden for the New York employer community.

However, please note that even though the NYDOL’s new regulations will not be implemented at this time, all existing laws and regulations regarding the payment of employee wages remain in effect. This includes, but is not limited to, requirements that employers obtain written authorization prior to paying employee wages by direct deposit or by payroll debit card, as well as restrictions on employers from charging fees or making deductions from wages. It is also possible that the NYDOL will submit alternate regulations in order to further its agenda.

As always, your friendly Fox Rothschild attorneys will monitor any new regulatory activity in this regard (or if the IBA’s decision is appealed further) and publish updates here or on our client alerts page.

Bill Egan writes:

Cancer treatment
Copyright: tashatuvango / 123RF Stock Photo

Aside from whistleblower and highly offensive sexual harassment cases, there may be no claim that elicits the protective instincts of the average jury more than disability discrimination cases, especially where the disability is cancer-related.  Employees with disabilities who are terminated without demonstrable cause often are seen as suffering the double indignity of dealing with whatever hardship their disability imposes and the termination of their employment because of it.  Adept attorneys paint a picture of the employer kicking an employee when he’s down and when you place the outcome of such a case in the hands of average Americans (i.e., a jury), and you have the makings of a big verdict.

Such was the case of Axel v. Fields Motorcars of Florida, Inc., where a Mercedes dealership terminated a 71-year-old used car and wholesale manager, Michael Axel, who had been diagnosed with kidney cancer in 2010.  Following surgery, the cancer metastasized to his lungs.  Axel elected to undergo an experimental treatment that came with very unpleasant side effects described as “tremendous” stomach pain, sores in his mouth, and sores on his feet.  Evidence was introduced that Axel’s supervisor expressed frustration with Axel because, among other reasons, he was “not getting real doctors treatment” but “other holistic or crazy things.”

The dealership terminated Axel in 2014, allegedly for making misrepresentations in 2004 on paperwork needed to obtain an auto auction access card for his son, a non-employee of the dealership who occasionally assisted Axel in transporting used cars to the local auto auction.  The son was not accused of misusing this authority other than to move vehicles.  In fact, he was employed by the dealership at the time of his father’s termination.   The misrepresentation on which the termination allegedly was based was discovered ten years after the fact, leading to the decision to terminate.  Pre-trial submissions did not reveal much in the way of other performance deficiencies by Axel.

The jury apparently rejected the dealership’s stated reason for the termination as pretext for disability discrimination.  It found that Axel was fired because of his disability in violation of the Florida Human Rights Act and awarded Axel $680,000 in lost wages and benefits, $600,000 for emotional distress, and $3.22 million dollars in punitive damages.  Notably, despite allegations of stray remarks reflective of possible age animus, the jury found that there was no age discrimination in the decision to terminate Axel’s employment.

A runaway verdict?  Perhaps, but verdicts of this nature and magnitude seem to occur more frequently in disability discrimination cases. This jury’s rejection of the age discrimination claim demonstrates a thoughtful and discerning assessment of the evidence presented.  This case serves as a reminder that disability discrimination cases stand in a class of their own and must be handled with utmost care and discretion.


Bill Egan is a partner in the Labor & Employment Department, resident in Fox’s Minneapolis office.

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Yesterday, the newly confirmed Education Secretary and Attorney General issued a joint letter eliminating the Obama administration’s guidance from last year addressing the issue of bathroom use by transgendered students.  Specifically, the former guidance had said that schools must allow students to use the bathroom of the gender with which they identify, even if that gender is different from the students’ biological gender.

The Obama administration had decided that under Title IX, discrimination based on transgender was sex discrimination.  This guidance was in line with positions taken by the EEOC pushing the issue that Title VII covered sexual orientation and gender identity discrimination because of its broad ban on sex discrimination.

Yesterday’s action only impacts public schools and not private employers.  The question is whether it will have a broader impact on EEOC enforcement strategies going forward.

Of course, the Supreme Court may, sooner, rather than later, have the final say on whether Title IX prohibits discrimination based on gender identity.  The Court is scheduled to hear argument in the case of Gavin Grimm v. Gloucester County School Board next month.  The case could have an impact on the interpretation of Title VII, not just Title IX.

We’ll be keeping an eye on this one.

Today’s post comes to us courtesy of Justin Schwam, an associate in the Labor and Employment Department in Roseland:

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With the trend of local paid sick leave ordinances continuing its progressive sweep in cities across the country, a consistent concern for companies located in the vicinity is whether their operations fall within the local law’s reach.  Does it only apply if the company is physically located in the city?  Or does any employee activity within the city trigger the often onerous recordkeeping obligations?

A few weeks ago, a Minneapolis judge limited the reach of the City’s law slated to go into effect later this year.   Judge Dickstein issued a temporary injunction against the enforcement of its Ordinance against businesses not physically located in the City.  Although the City argued that its exclusive enforcement authority meant that it would not apply the Ordinance against businesses outside the City, the court recognized that such assurances, “however sincere,” did not alter the Ordinance’s plain language.

The court’s analysis of this issue is also notable for its dissection of the City’s argument that its action was a permissible exercise of its police powers to protect the health and welfare of residents.  The court found that the City’s attempt to regulate extraterritorial businesses whose employees “are unlikely (or may never) enter the city while sick” was not a narrowly tailored means of addressing “identifiable harms within the city limits,” such as a rule governing the inspection of extra-territorial cows whose milk was sold within the city.  Because a prime justification for these local ordinances is typically the need to protect residents from the spread of contagion, the court’s refusal to accept policymakers’ assumptions that ill workers would use the sick leave benefit to “protect against potential harm” is significant.

Although the injunction ultimately may be lifted, or the ordinance amended – it’s not scheduled to take effect until July 1, 2017 – employers not located in Minneapolis are breathing a sigh of relief.   For now, employees who occasionally travel to Minneapolis will not be entitled to accrue sick leave under the law.

As local action on this issue will no doubt continue to pick-up steam, since more state governments are looking at measures to prevent municipal action than are moving to enact state-wide measures, it will be interesting to see how cases like this one influence future legal challenges and how future paid sick leave laws are drafted.  We will keep an eye out and report back on any developments.

 

This past week, a news story appeared in New Jersey that caught my eye. It was the story of an eighth grade female basketball player at St. Theresa’s school in Union County. Admittedly, the story initially piqued my interest because it was set at was my childhood parish, with the accompanying warm memories of playing basketball in the parish hall gym.

But after reading the story, it was a great illustration of how to handle opportunities in the workplace that, for one reason or another, are not available to all genders. St. Theresa’s had previously made a decision to cut the girls eighth grade basketball team due to low enrollment. However, the boys’ eighth grade program was left intact. Thereafter, the girl sought to play on the boys team but was rebuffed by the archdiocese.

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In fairness to the archdiocese, it offered her the opportunity to play on the girls basketball team at a neighboring parish. Her family declined the offer and brought suit. This week, the court dismissed the case as a matter of law, saying that there was no implicit right to play on a team of the other gender.

While your company likely does not have single-gender sports teams, there are undoubtedly company activities that intentionally or unintentionally segregate by gender or another identifier. We discourage such practices. Even if separate activities are provided to both genders, there runs the risk that one activity will be seen as more desirable than the other.

To the extent that you must segregate workplace activities by gender, make sure the terms and conditions (time, place, budget) are the same for both. Also, ensure that decision makers and senior employees attend both events, regardless of their gender.

We are just rounding out our list of new employment laws before the clock strikes midnight tomorrow.

If you missed the first two parts of our list of new laws, you can find them here and here.

It seems that we are not done with sick leave laws.  Illinois recently passed the Employee Sick Leave Act.  Before Illinois employers panic, this law does not require that employers provide paid or unpaid sick leave.  The law simply requires that employees be given greater flexibility in how they can use sick leave benefits that may be provided by employers.  Basically, employees must be permitted to use up to half of their accrued sick leave benefits for absences due to an illness, injury, or medical appointment of the employee’s child, spouse, sibling, parent, mother-in-law, father-in-law, grandchild, grandparent, or stepparent.

Switching gears from sick leave laws, the new I-9 forms have finally been issued.  Employers must use the new I-9 forms beginning on January 22, 2017.  More details can be found on our Immigration View blog here.

In perhaps the most unusual news, Portland, Oregon has made history as being the first jurisdiction to implement a CEO tax for highly compensated executives.  Starting on January 1, 2017, any company who has a CEO who makes 100 times the average employee’s income will see their corporate tax rate increased by 10%.  If the CEO makes 250 times the average employee’s income, then the increase will be 25%.

Finally, what round-up would be complete without some mention of California.  It seems that new employment laws in California are as frequent as a Kim Kardashian selfie.  Although there are several new laws for 2017, the ones going into effect in January are changes to California’s Fair Pay Act, an increase in the minimum wage, and restrictions on arbitration agreements:

  • Fair Pay Act — the protections against discriminatory pay will go beyond gender.  Under the amendments to the law, employees must be given equal pay for equal work regardless of gender, race or ethnicity.
  • Arbitration Protections — There are two new statutes that provide additional protections from employees who may be subject to arbitration agreements.  The first is to state that any party to an arbitration proceeding has a right to have the proceeding recorded by a certified shorthand reporter.  The second is more substantive and prohibits employers from requiring California employees to arbitrate or litigate their claims in any other state besides California, nor can choice of law provisions apply any other states’ laws.
  • Minimum Wage — The minimum wage will increase to $10.50 per hour for any employer with 26 or more employees.

Hopefully, our list of new employment laws did not depress you so much that you over indulge in champagne on New Year’s Eve!  Starting the New Year with a hangover is bound to get you off on the wrong foot.

 

The end of the year, that is.  Although given the number of celebrity deaths in the last week, I think some people might be reading that headline a little more broadly.  We are not making doomsday predictions, however.

Back in the fall, we started a list of employment laws that were going to go into effect in January 2017.   We tried to get a jump start on the list as we knew how quickly the end of the year can creep up on you.  How right we were as the Fall flew past and now we find ourselves just days away from the New Year without having updated the list.

Our first big update is to remind everyone that the FLSA salary test has been enjoined.  The other big changes have to do with sick leave laws.  The last few years have seen a lot of jurisdictions adopting sick leave laws.  This year is no exception. The sick leave laws going into effect in January 2017 are as follows:

  1. Executive Order 13706 — Back in September, President Obama issued an Executive Order that applies to federal contracts entered into, sent out for bid, or renewed after 1/1/17.  The EO requires that contractors provide up to a maximum of 56 hours paid sick leave per year.  The DOL has issued guidance for the Final Rule, which can be found here.
  2.  Morristown, New Jersey becomes the latest New Jersey municipality to have a paid sick leave law.  The law goes into effect on 1/11/17 and requires employers with 10 or more employees to provide up to 40 hours of paid sick leave.  Employers with less than 10 employees are not exempt from the law; they only have to provide 24 hours of sick leave.
  3.  Vermont –  The law applies to employers with 6 or more employees and goes into effect on 1/1/17.  This law does have two phase-in provisions.  For employers with less than 6 employees, the law will not be effective until 1/1/18.  For other employers, in the first year, they must only provide up to 24 hours of sick leave.  After the first year, employers must provide up to 40 hours of sick leave.
  4.  Spokane, Washington – This law is also effective as of 1/1/17 and is similar to Morristown’s law in that there are different requirements for employers with 10 or more employees and less than 10 employees. Employers with 10 or more employees must provide up to 40 hours of paid sick leave while employers with less than 10 employees must provide up to 24 hours of sick leave.

The laws will not only require a review of policies to insure that employees are being provided with sick leave, they also come with record keeping requirements and notice requirements.  Employers with questions are encouraged to seek the advice of employment counsel.

Delaware’s legislature and Governor have been busy bees in 2016.  This post details three protections added to Delaware’s employment discrimination law in 2016, two of which become effective on December 30th (i.e., next Friday).  Specifically, these laws protect employees on the basis of an employee’s (1) reproductive health decisions, (2) family responsibilities, and (3) wage discussions or disclosures.  Also worth noting:  each of these three provisions applies to employers who have 4 or more employees within the state at the time of an alleged violation.

Legislation

Reproductive Health Decisions

Effective December 30, 2016, Delaware employers should be aware that it is an unlawful employment practice to discriminate against any individual with respect to compensation, terms, conditions, or privileges of employment (including failure/refusal to hire or discharge) because of a “reproductive health decision” by the individual. Reproductive health decision is defined as any decision “related to the use or intended use of a particular drug, device, or medical service, including the use or intended use of contraception or fertility control or the planned or intended initiation or termination of a pregnancy.”

It’s noteworthy here that this section doesn’t limit the prohibition against discrimination to actions taken against employees; that is, applicants are protected under this definition.  Nor is there language that carves out certain religious employers from this law, unlike there is for sexual orientation and gender identity under Delaware law.  As a general matter, an employee’s reproductive health decisions are probably not something most employers are (or should be) interested in, but as of December 30th, employers should not use any such knowledge they may have as the basis of an adverse employment action.

Family Responsibilities

Effective December 30, 2016, Delaware employers also may not engage in certain discriminatory acts based upon an employee’s “family responsibilities.”  As defined in the statute, family responsibilities means an employee’s caregiving obligations “to any family member who would qualify as a covered family member” under the FMLA.  This section does, however, permit employers to take certain actions “with respect to the employer’s attendance and absenteeism standards that are not protected by other applicable law and inasmuch as the employee’s performance at work meets satisfactory standards.”  It will be interesting to see if the Delaware Department of Labor issues any regulations or guidance to further clarify this section.

It’s also important to note that this law does not create an entitlement to leave for purposes of family responsibilities in and of itself.  The law itself notes that employers are not obligated to make special accommodations for employees who may have family responsibilities.  Rather, this is a non-discrimination provision, meaning the employer must apply its policies “related to leave, scheduling, absenteeism, work performance and benefits” in a manner that is not discriminatory against employees with family responsibilities.  This law provides another reason for employers to audit their workplace policies and practices — and seek any needed training — on these items to ensure compliance moving forward.

Wage Discussions/Disclosures

Delaware employers should also note that since June 30, 2016, it has been an unlawful employment practice under state law to:

(1) Require as a condition of employment that an employee refrain from inquiring about, discussing, or disclosing his or her wages or the wages of another employee;  (2) Require an employee to sign a waiver or other document which purports to deny an employee the right to disclose or discuss his or her wages; [or] (3) Discharge, formally discipline, or otherwise discriminate against an employee for inquiring about, discussing, or disclosing his or her wages or the wages of another employee.

The law does not obligate employers or employees to discuss wages; instead, it merely provides state law protection for employees who do choose to discuss wages.  A number of other states across the country have similar provisions.
Need to get up to speed on how these new laws may affect your workplace (including any needed updates to your employee handbook)?  Give us a call, or email us!