There were a number of issues brought up that were discussed but there were two that I haven’t seen addressed much elsewhere.

First, there are companies that are rolling out internal social network programs that essentially create a Facebook for just company employees on a closed network.  Sounds good, right? But employers need to understand that these networks may still be subject to the NLRA. So, if you prohibit employees from talking about salaries on that site, you may start running afoul of labor laws.

Similarly, suppose your company monitors your Company’s name across a variety of social media sites.  What happens when you discover not only customers but employees using your name? Numerous panelists at companies suggested to overreacting.  It may be a violation, but what is the appropriate remedy. Training employees is key.  And if no one else really saw it, what’s the real harm?

The takeaway? Social media is rapidly developing. Policies, a strategy and training remain a company’s best approach to the issue.    And don’t forget that the usual laws apply.

Well, did you miss it?

Just as people were settling down to the NLRB’s new speedy election rules this month, events over the last two days have completedly upended that.

First was the Court action. As noted by the Employer Law Report blog, “The NLRB was issued a stunning rebuke yesterday by U.S. District Court Judge James Boasberg (an Obama appointee) when he ruled that the NLRB’s controversial union election rule changes were invalid because they were enacted without the required three-member quorum.”

Second, the NLRB itself reviewed the ruling and its rule and yesterday suspended implementation of the new rule.  As reported by Labor Relations Today, “The Board just announced it has temporarily suspended the implementation of changes to its representation case procedures. While Board Chairman Mark Gaston Pearce reiterated his support for the rule changes, pending review of legal options, the Board will continue to process representation petitions under the previous, long-standing guidelines. ”

You can read the NLRB’s announcement here. 

You may recall that the NLRB also tried to institute new rules regarding postings in the workplace. But court challenges to that rule also led the NLRB to suspend implementation of that rule too. 

For employers, the last few days have moved pretty quickly.  But if you’re keeping score at home, it might read: Courts 2, NLRB 0.  Stay tuned.

For employers, the cases are a mixed bag but do provide some useful practice pointers.

City Sheriff Was Not an “Employee” Entitled to Statutory Protection 

In Young v. Bridgeport, the Court ruled that a plaintiff could not proceed with his whistle-blower retaliation claims because he was an independent contractor, and not an employee. Because only “employees” can bring a cause of action under Conn. Gen. Stat. 31-51m and 31-51q (claims for whistle blowing and free speech protection), the court lacked jurisdiction over the claim.

So what was the Plaintiff’s position? He was a City sheriff, elected to hold office for a term of two years, and had held the position for approximately 18 years.  Notably, City sheriffs have no affirmative duties, have no scheduled work hours or office space in a city building, but may serve process on behalf of the city, private entities or even individuals.  This, in the court’s view, was not enough to satisfy the employee-control test outlined by the Court in 2004 in the Nationwide Mutual Ins. Co. v. Allen case.

For employers, it’s another reminder of the importance of clear rules of who is an employee and who is an independent contractor.  It can be the difference between a claim going forward and a claim being dismissed.

Failure to Return Personnel Belongings Promptly May Be Retaliatory

In Eagen v. CHRO, an UConn attorney who specialized in labor & employment law, unsuccessfully appealed a finding that he had retaliated against a former university laboratory animal veterinarian for whistle blowing activities.  For me, the most notable part is that the veterinarian’s name is — get this — “Daniel Schwartz”.  (To be perfectly clear, that is an entirely different Dan Schwartz and has no relation to me.) But of course, there’s more to the case than the name.

It’s an unusual decision.  At the CHRO, a Human Rights Referee awarded Schwartz $5000 in emotional distress damages for the attorney’s actions in failing to return all of Schwartz’ personal belongings following termination.   The court said that failure to return the belongings could be seen as being an “personnel action”, which the court interpreted as the same as an “employment action”.

For employers, this case has some significant implications if the logic is upheld. Typically, the employee’s employment termination will “end” the type of actions that can be viewed by an employer as retaliatory.  But here, the Court suggested that the failure to return personnel belongings could be viewed as retaliation for the actions of the employee and that it may have a chilling effect on other whistle-blowers.

Look to the “Adverse Employment Action” Date to Determine if Employee is “Qualified Individual”

Lastly, but perhaps just as significantly, the Court decided Tomick v. UPS upholding most of a $500K+ verdict against the employer but also sending part of the case back for further consideration.   The case has a long and tortured history and also a complicated background.  Frankly, it’s a mess try to briefly recap in a blog post.

Among the issues the court decided was whether an employer’s request of an employee to take a drug test without reasonable suspicion violates Connecticut’s drug testing statute, regardless of whether the employee actually takes the test.  The Court concluded that the mere fact that the request was made was sufficient to give rise to a claim, at least given the circumstances of the case.

The court also answered a question that has been out there on disability discrimination cases. Someone has to be a “qualified individual” in order to fall within the the state’s disability anti-discrimination laws.  But what is the proper  date for making that determination.  The employer argued that the relevant date is the date of the adverse employment action, not the date when the termination process occurred or began.  The court agreed.  Notably and by contrast, when evaluating a claim of negligent infliction of emotional distress, the relevant inquiry is whether the employer’s conduct was unreasonable during the “termination process.”  On this issue, the Court remanded the case back to the Superior Court for further findings.

The court also examined attorneys’ fees and emotional distress damages and upheld them as well.

For employers, the case emphasizes the need of employers to seek legal counsel the instant an employment situation seems complicated.  The facts of this case show things moving at a rapid pace.  In addition, it’s important for employers to consider the termination process as well; be fair and respectful to avoid possible “emotional distress” claims later on.

The EEOC released new statistics this week, however that shed a little bit of light on the subject, albeit with a fairly small sample size.

For FY 2011, the EEOC reported that 262 charges of discrimination were filed directly with the EEOC in Connecticut.  That is down from a high of 295 the year before.   Nationally, the number of claims filed hit a high of 99, 947 for the same period, up very slightly from the prior year.  

Not surprisingly, retaliation claims led the way with race discrimination claims.  Only one (!) GINA complaint was reportedly filed during this period as well.

You can check out all of the statistics here.  

• Senate Bill 79, which passed the Senate, would have made it illegal for employers to refuse to hire someone based on being unemployed.  The bill did not come up for a vote in the House.
• House Bill 5235, which would have made significant changes to the Personnel Files Act, never made it out for a vote.
• House Bill 5291, which would have increased the minimum wage in the state, also failed to receive a vote in the Senate.

Connecticut lawmakers approved legislation that allows government agencies to negotiate labor agreements on construction projects, The Associated Press reports.

The House on Monday voted 109-37 to approve the measure, following Senate approval last week. It now goes to Gov. Dannel P. Malloy, who has promised to sign it.

Malloy emphasized parts of the legislation that give the state transportation commissioner more flexibility in directing how high construction and maintenance projects are contracted. The governor says the legislation will make Connecticut more competitive in applying for critical federal money.

The legislation allows government to negotiate so-called project labor agreements that establish a dispute resolution process between contractors and unions.

The dust is still settling this morning, but in contrast to 2011, it looks like employers won’t have as much to worry about this year.

Free Speech in Workplace Has Limits

In one of the most significant employment law cases decided by the Connecticut Supreme Court in recent years, the Court unanimously ruled earlier this month that an employee’s free speech rights in the private workplace do not extend to speech pursuant to his job duties.  Those rights do not cover insubordinate behavior either. In doing so, the Court reversed the jury verdict to the employee of approximately $10 million.

I typically don’t write about cases that I’ve handled, but given the importance of this case, the client, LabCorp, has approved an exception. My public thanks to them for allowing me to share this important case with you. (I first alerted you to the case in this post.)

The case, Schumann v. Dianon, can be downloaded here.  You can read the basic facts there but the case concerned a laboratory doctor who refused to use certain diagnostic codes for lab tests that were being performed and claimed that it would affect patient safety.   He brought a claim under Conn. Gen. Stat. 31-51q which purports to apply First Amendment protection to Connecticut employers. (You can view additional articles about the case here, here and here.)

A few years ago, the U.S. Supreme Court ruled, in Garcetti v. Ceballos, that when public employees make statements pursuant to their official duties, such speech is not protected by the First Amendment. Because the First Amendment typically applies to public employers, the issue in the Schumann case was whether the Garcetti rule applied to actions brought against private employers in Connecticut. A state statute, Conn. Gen. Stat. 31-51q and prior caselaw has applied First Amendment protections to both public and private employers.

The Court in Schumann, in a 7-0 decision, concluded that Garcetti applied to private employers and that the Superior Court erred in not applying that caselaw. In doing so, the Court reversed the jury verdict and remanded the case to the Superior Court to issue a judgment for the employer on the claim.  Dianon argued that not applying Garcetti could lead to absurd results. As summarized by the Court:

The defendant contends that precluding the application of Garcetti to private employers in an action brought pursuant to § 31-51q would render the statute “an absurdity” as applied to the health care industry because “[v]irtually every workplace dispute involving a health care worker would become a free speech case . . . with every employee serving as a roving ombudsman free to overrule her employer,” thus creating a “lose/lose situation, no matter what the company does [wherein] someone will be unhappy with the result and could claim a free speech right to refuse to accept the employer’s decision.”

The Court agreed and found that lower court decisions to the contrary were incorrect.

We disagree with those cases holding Garcetti inapplicable in the private sector because of their incongruous effect of giving private sector employees greater workplace free speech rights than those afforded to their public sector counterparts—a result plainly not envisioned in the Supreme Court’s decision, which recognized that ‘[g]overnment employers, like private employers, need a significant degree of control over their employees’ words and actions; without it, there would be little chance for the efficient provision of public services.’

The court added, “Applying Garcetti to federal constitutional claims brought under § 31-51q keeps courts from the constitutionally untenable task of, in essence, having to choose sides in a work-related viewpoint dispute between two private actors. Thus, we conclude that the rule in Garcetti v. Ceballos, … applies to claims under § 31-51q grounded in the first amendment that are brought against private employers, and must be considered as a threshold matter prior to undertaking the Pickering/Connick balancing test articulated in DiMartino v. Richens….”

In applying the facts of the case to this rule, the Court agreed with the employer that the speech proffered by the employee was not protected. The speech was “part and parcel of his concerns about his ability to properly execute his duties.” 

The court declined to address whether the state constitution afforded the employee any additional protections because even under the “pre-Garcetti standards,” his speech would not have been protected.

“Applying these principles to the facts of the present case, it is readily apparent that the plaintiff’s speech in its entirety was extraordinarily disruptive to his employment with the defendant and, therefore, not constitutionally protected under the Pickering balancing test— regardless of whether Garcetti applies. First, all of the speech at issue took place in the work environment, rather than on the plaintiff’s own time. Second, the speech greatly interfered with the plaintiff’s job performance, as he acknowledges that, although he had been directed to sign out urine cases using the new diagnostic language, he refused to do so because of his concerns regarding the safety and reliability of the new test, performing only prostate biopsy tests and those few urine tests that could be done without the new language.”

Quite simply, the court said, it was insubordination. “[B]ecause the plaintiff’s speech in opposition to the defendant’s new diagnostic codes was accompanied by his refusal to use those codes, it was insubordinate in nature, removing it from the ambit of constitutional protection.”

There were two concurrences in this case. Justice Palmer wrote a concurrence noting that he would have considered whether the state constitution protected the speech, but generally agreed with the result.

Justice Zarella wrote a notable concurrence that may serve to be the basis of future arguments by employers. He suggested that he would overturn prior caselaw and conclude that Conn. Gen. Stat. 31-51q was inapplicable to any speech made by a private sector employee in a private workplace.  It certainly seems an invitation to employers to raise the issue in the future, though notably, no other justice joined him in that concurrence.

On a personal note, kudos to associate Cara Ceraso and all the people at my firm, Pullman & Comley, LLC, for their assistance in achieving this result for the client. An additional public thanks to my co-counsel at Jones Day, Greg Castinias and Lee DeJulius for their extraordinary work as well.

Are Policies "Up In Smoke"?

Besides just permitting individuals to use marijuana, it has several important provisions that will impact employers in Connecticut.  Unfortunately, as the history of medical marijuana bills in other states has shown, there are still many unanswered questions left.  Employers will be wise to seek legal counsel to understand the full implications of this bill in their specific industry and workplace.

(I previously discussed the impact of last year’s bill to decriminalize marijuana here.)

Under the new law (which you can download here), employers are prohibited from refusing to hire, firing, penalizing or threatening an employee “solely on the basis…as a qualifying patient or primary caregiver.”  The law does have an important caveat; the employer can act if ”required by federal law or required to obtain federal funding.”  Thus, if there are, for example, commercial driving laws in your industry that restrict the use of marijuana, it appears that law will trump state law.

The law does not, however, clarify what it means to be “solely” on the basis of.  Does that mean an employer can consider it but just combine it with other reasons?  Does that mean if an employee brings in marijuana to work (but doesn’t use it) that would be sufficient grounds for termination?

Notably, the law also states that marijuana use is not allowed “(A) in a motor bus or a school bus or in any other moving vehicle, (B) in the workplace, (C) on any school grounds or any public or private school, dormitory, college or university property, (D) in any public place, or (E) in the presence of a person under the age of eighteen.”

Sounds good, right? Except what does “in the workplace” mean? Any place where the employee works? In the home office? What happens if the employee is an outside salesman? Can an employer still implement a “zero-tolerance” workplace policy?

Before an employer frets too much, the bill does add that the bill does not “restrict an employer’s ability to prohibit the use of intoxicating substances during work hours or restrict an employer’s ability to discipline an employee for being under the influence of intoxicating substances during work hours.”

So, if an employer still has a policy (much like it does for alcohol) that restricts the use of these substances during work hours, that appears to be safe.

But still, questions remain.  What if the employee requests a reasonable accommodation under state law to smoke marijuana during work hours, arguing that it will allow her to do her job?  There is no doubt that, despite some of the language in the statute, that some will seek to have this issue litigated.

For more background on how other states have dealt with this issue, see these posts from Michigan, Washington, Pennsylvania and Delaware. 

Employers that have had multi-state offices have had to address this for some time, but for all other employers, the new law is bound to cause a late night or two thinking about this.  You may want to break out some munchies: We’re in for a ride.

The Labor Department says it is cracking down on firms that fail to pay interns properly and expanding efforts to educate companies, colleges and students on the law regarding internships.

“If you’re a for-profit employer or you want to pursue an internship with a for-profit employer, there aren’t going to be many circumstances where you can have an internship and not be paid and still be in compliance with the law,” said Nancy J. Leppink, the acting director of the department’s wage and hour division.

The biggest problem, according to the article is that the employer should derive “no immediate advantage” from the intern’s activities — “in other words, it’s largely a benevolent contribution to the intern.”  The takeaway from this article, as I said back in 2010 is that employers should not use interns to do real work. 

Flash-forward to 2012. The New York Times over the weekend ran another piece on internships. This time, however, it was critical of employers who only assigned the interns menial tasks.

Although many internships provide valuable experience, some unpaid interns complain that they do menial work and learn little, raising questions about whether these positions violate federal rules governing such programs.

So, within the span of two years, you have two articles on internships: One critical of employers that assign unpaid interns real work and one critical of employers that assign unpaid interns menial work.

What’s an employer to do?  

Well, I talked quite a bit about this on Thursday on The Proactive Employer radio show and there were really two solutions (you can listen to the entire broadcast below).

First, if you’re going to have interns do real work, you can do so — you just need to pay them minimum wage.  Second, if keeping interns unpaid is important, it’s critical that employers follow six criteria outlined by the U.S. Department of Labor. 

The articles in The New York Times are well-timed to make sure that employers are aware of their obligations.  What I said back in 2010 holds true today: “As the summer season approaches, employers are now on notice that their use of interns is going to be under closer scrutiny than ever before. ”

The decision in Patino v. Birken Manufacturing has long been anticipated and is an important decision affirming the broad protection the state’s anti-discrimination laws give to sexual orientation.  You can find more background on the case here. 

According to the court:

We conclude that the phrase ‘‘terms, conditions or privileges of employment’’ constitutes a term of art with a fixed legal meaning, and the legislature’s use of that phrase in § 46a-81c (1) evidences its intent to permit hostile work environment claims where employees are subject to sexual orientation discrimination.

I’ll have more on the decision in an upcoming post next week.

Interpretation of the federal Fair Labor Standards Act is aided by hundreds of pages of regulations and U.S. Department of Labor advisory opinions. Connecticut’s wage-hour statutes, which cover the same ground, have far fewer interpretive aids.

But since states can regulate payment of wages, work hours and overtime practices more strictly than the federal law (which is why many states, including Connecticut, have a higher minimum wage), it is often a question as to whether Connecticut allows a wage payment practice that is clearly acceptable under the FLSA.

One such practice is the payment of overtime calculated on a “fluctuating work week”.

 The fluctuating work week method has been allowed under federal law since the 1940’s. A recent and well-reasoned Connecticut Superior Court decision, Roach v. Moran Foods, issued on March 16, 2012, now seems to establish that Connecticut employees can use the fluctuating work week and be in compliance with Connecticut law.  (You can view the complaint in the case here.)

The most important element in the fluctuating work week method is that an employee’s work hours genuinely fluctuate from week to week. The employee can be paid an equal amount each week (much like a salary), and his hourly rate is determined by dividing the pay amount by the number of hours actually worked in any week. The employee is paid overtime (that is, the extra half-time) for all hours in excess of 40.

Let’s say an employee is paid $800 per week. Under the usual method, this would be $20 an hour for a 40-hour week. It’s a good deal for the employee in weeks in which fewer than 40 hours are worked; in a 20-hour week, he gets the equivalent of $40 per hour. But in a 50-hour week, the regular rate is only $16 per hour. Since the $800 covers all hours at the regular rate, the employee is owed half-time, $8 per hour, for the extra 10 hours over 40, or $80. Without the fluctuating work week method, his overtime would be $300.

There is an important caveat – the regular rate under the fluctuating work week can’t be below the minimum wage. When I started drafting this post, I chose $400 as the weekly pay, but my 50-hour example resulted in a regular rate of $8, and the minimum wage is $8.25. So I inflated my example to $800 per week.

One other important caveat is that the fluctuating work week method must be established in a clear agreement between the employer and the employee. This should be in writing and signed by the employee.

The fluctuating work week may not be for every employers, but in the right situation, it can be a very useful way of paying employees while controlling costs.