New York Labor and Employment Law Report

U.S. District Court Invalidates "Quickie" Election Rule

Tyler Hendry — Tue, 15 May 2012 12:44:14 -0500

On May 14, 2012, a federal district court judge invalidated new regulations intended to streamline union representation elections, finding that the National Labor Relations Board lacked a proper three-member quorum when it voted on the controversial final rule in December of 2011. The final rule, which has commonly been referred to as the "ambush" or ""quickie" election rule, went into effect on April 30, 2012. The same federal district court judge had previously denied a request for a stay of the final rule, stating that he intended to issue a decision on the merits of the case by May 15.

Judge James Boasberg of the U.S. District Court for the District of Columbia found that the required three members necessary to establish a quorum were not present when the rule was adopted on December 16, 2011 because Member Hayes failed to participate in the final vote. Hayes had previously voted against initiating the rulemaking process and against proceeding with the final rule. Because of this prior opposition, the two other members issued the final rule without Member Hayes' participation.

Judge Boasberg rejected the Board's argument that Member Hayes had "effectively indicated his opposition" and that his participation in the final vote was not necessary. In rejecting this argument, Judge Boasberg cited to an unlikely source:

According to Woody Allen, eighty percent of life is just showing up. When it comes to a quorum requirement, though, showing up is even more important than that. Indeed, it is the only thing that matters -- even when the quorum is constituted electronically. In this case, because no quorum ever existed for the pivotal vote in question, the Court must hold the challenged rule is invalid.

Judge Boasberg further reasoned that Member Hayes could not be counted toward a quorum particularly because no one on the Board reached out to him to ask for a response, as is the agency's usual practice where a member has failed to vote. Judge Boasberg stated that if Hayes had affirmatively expressed his intent to abstain or acknowledged receiving notification that the final rule had been circulated, he may have been counted in the quorum; however, because none of those things happened, Judge Boasberg found that Member Hayes failed to "show up -- in any literal or even metaphoric sense." Because the Board failed to meet the quorum requirement, Judge Boasberg refused to address the plaintiffs' challenge to the final rule on various procedural and substantive grounds.

It remains to be seen whether the newly constituted Board -- complete with three controversial and challenged recess appointees -- will be assembled to take final action on the "quickie" election rule. In his decision, Judge Boasberg noted that nothing appears to prevent a properly constituted quorum of the Board from voting to adopt the rule if the Board desires to do so. In addition, an appeal of Judge Boasberg's decision is likely. If a new vote on the rule is held, it is likely that the rule will once again be challenged.

The Board has announced that, at least for now, all union representation elections based on petitions filed on or after April 30, 2012 will proceed under the old rules.

Appeals Court Holds That Six-Month Statute of Limitations Applies to OSHA Record-Keeping Violations

Michael D. Billok — Tue, 08 May 2012 15:06:10 -0500

In an extremely important decision for employers, the United States Court of Appeals for the D.C. Circuit held that an employer can only be cited by OSHA for up to six months following the occurrence of an error or omission in its injury and illness record-keeping logs. In so holding, the Court restored the plain text of the Occupational Safety and Health Act (the "Act"), which provides that "no citation may be issued . . . after the expiration of six months following the occurrence of any violation." OSHA regulations require employers to maintain their injury and illness logs for five years from the end of the calendar year that those records cover. Relying on that regulation, OSHA had a longstanding practice of issuing citations up to five years following an alleged record-keeping violation. For the first time, an appeals court held that this practice is contrary to the explicit statute of limitations contained in the Act.

The Court's decision was unanimous, and none of the judges thought very highly of OSHA's arguments to extend the statute of limitations to five years for record-keeping violations. The Court stated that OSHA was "heroically attempt[ing]" to "tie this straightforward issue into a Gordian knot," and was "kick[ing] up" a "cloud of dust . . . in an effort to lead us to [the Secretary of Labor's] interpretation."

While employers may still be cited beyond the six-month statute of limitations if violations are continuing or ongoing, this decision will have a significant impact on OSHA's enforcement of employers' record-keeping obligations. OSHA has 90 days from the date of the decision to file a petition for writ of certiorari to the Supreme Court if it wishes to appeal the Court's decision.

Lawmakers Scrutinize Employer Efforts to Access Employee and Applicant Private Social Media Web Sites

Christa Richer Cook, Esq. — Sat, 28 Apr 2012 09:02:48 -0500

As we noted in our June 17, 2010 blog post, social networking sites have become a popular tool for employers seeking information about job applicants during the hiring process. However, employers' efforts to obtain information that enables them to access their employees' and applicants' private social media web sites have recently been subject to increased scrutiny by New York State and Federal legislators.

On April 13, 2012, New York State Senator Liz Krueger sponsored and introduced a bill that would prohibit employers, as well as their agents or representatives, from requiring employees or job applicants to disclose log-in names, passwords, or other means for accessing a personal account or service through an electronic communications device. This includes information such as private social media account log-in names and personal e-mail account passwords. This proposed legislation would also prohibit employers from discharging, disciplining, or otherwise penalizing an employee, or failing to hire an applicant, based on the refusal to provide information that would enable the employer to access personal accounts or services through an electronic communications device. The New York Attorney General would have the authority under the proposed legislation to enjoin employers from committing such unlawful practices, and employers could be subject to a $300.00 fine for a first offense and a $500.00 fine for each subsequent offense.

This proposed legislation comes just weeks after U.S. Senators Charles Schumer (D-NY) and Richard Blumenthal (D-CT) sent open letters to the Equal Employment Opportunity Commission and the U.S. Department of Justice urging the agencies to investigate employers' practice of requiring applicants to provide Facebook and e-mail passwords as a condition for job interviews.

Efforts to enact legislation similar to the New York bill are currently underway in several states. In fact, Maryland recently became the first state to enact legislation that prohibits employers from requiring that employees or applicants disclose user names, passwords, or other means for accessing a personal account or service through an electronic communications device.

As we indicated in our June 17, 2010 blog post, employers should be careful even when viewing publicly available information regarding applicants on social media web sites. Because Facebook and other similar web sites potentially contain a plethora of information about job applicants that employers cannot consider during the hiring process (e.g., race, national origin, religion, marital status, sexual orientation, etc.), employers should exercise caution in using social media web sites to screen applicants. Employers who choose to use social media in the hiring process should promulgate a clear policy and procedure for utilizing this tool, and should closely follow the developments in this area of the law.

D.C. Circuit Court of Appeals Grants Injunction Precluding Implementation of NLRB Notice Posting Rule

Subhash Viswanathan — Tue, 17 Apr 2012 12:41:29 -0500

The U.S. Court of Appeals for the D.C. Circuit issued an Order today granting an injunction precluding the National Labor Relations Board from implementing its notice posting rule, pending appeal of a lower court decision upholding the validity of the rule. The notice posting rule was scheduled to go into effect on April 30, 2012, but employers will not be required to comply with the rule until the D.C. Circuit Court of Appeals has had the opportunity to determine whether the NLRB exceeded its authority under the National Labor Relations Act by issuing the rule.

In its Order granting the injunction, the D.C. Circuit Court of Appeals noted that the NLRB voluntarily postponed implementation of the notice posting rule during the pendency of the proceedings before the U.S. District Court for the District of Columbia, which seemed to undercut the NLRB's argument that the rule should take effect during the pendency of the appeal. The D.C. Circuit Court of Appeals also noted that the NLRB indicated an intent to cross-appeal the portion of the District Court's decision that invalidated certain enforcement provisions of the rule, which created some uncertainty regarding the manner in which the rule will be enforced.

Prior to the issuance of this injunction, U.S. District Courts in two separate jurisdictions had issued conflicting decisions regarding the validity of the notice posting rule. The U.S. District Court for the District of Columbia held in March that the NLRB had the authority to require employers to post the notice, but did not have the authority to issue a blanket rule that failure to post the required notice will be considered an unfair labor practice and did not have the authority to permit tolling of the six-month statute of limitations for unfair labor practice charges in situations where an employer fails to post the required notice. However, the U.S. District Court for the District of South Carolina held on April 13, 2012 that the NLRB did not even have the authority to require employers to post the notice. In its Order granting the injunction, the D.C. Circuit Court of Appeals cited the recent U.S. District Court for the District of South Carolina decision.

According to the D.C. Circuit Court of Appeals Order, briefing of the appeal is expected to be completed by June 29, 2012, and oral argument is expected to be scheduled in September 2012.

U.S. District Court for the District of South Carolina Holds That NLRB Notice Posting Rule Is Invalid

Subhash Viswanathan — Sun, 15 Apr 2012 08:24:27 -0500

On April 13, 2012, the U.S. District Court for the District of South Carolina held that the National Labor Relations Board's rule requiring private sector employers to post a notice of employee rights under the National Labor Relations Act is invalid, because the NLRB did not have the authority under the NLRA to promulgate the rule. There are now conflicting decisions of U.S. District Courts in two separate jurisdictions regarding the validity of the notice posting rule. The U.S. District Court for the District of Columbia previously held that the NLRB had the authority to require employers to post the notice, but also found that certain enforcement provisions of the rule were invalid.

In the case filed by the U.S. Chamber of Commerce and the South Carolina Chamber of Commerce, the U.S. District Court Judge noted that the NLRA grants the NLRB authority to promulgate rules that are "necessary to carry out" the provisions of the NLRA. The Judge held that the NLRB failed to demonstrate that the notice posting rule is "necessary" to carry out any provisions of the NLRA.

The decision of the U.S. District Court for the District of Columbia upholding the validity of the notice posting rule has already been appealed by the plaintiffs to the District of Columbia Circuit Court of Appeals, and it is likely that the NLRB will appeal the recent decision of the U.S. District Court for the District of South Carolina to the Fourth Circuit Court of Appeals. If the two Circuit Courts of Appeals reach conflicting decisions, it is possible that the U.S. Supreme Court may eventually address the validity of the NLRB's notice posting rule.

The notice posting rule was scheduled to take effect on April 30, 2012. At this point, it is not clear whether the NLRB will suspend enforcement of the notice posting rule for employers across the nation pending appeal, or whether the NLRB will take the position that enforcement of the rule is suspended only for employers within the jurisdiction of the U.S. District Court for the District of South Carolina. Stay tuned for further updates on this blog as they become available.

OSHA Announces National Emphasis Program for Inspecting Nursing Homes and Residential Facilities

Michael D. Billok — Fri, 06 Apr 2012 09:25:22 -0500

On April 5, the Occupational Safety and Health Administration ("OSHA") announced a new National Emphasis Program ("NEP") for inspecting nursing homes and residential facilities. This is an important announcement, because for most employers, there are only a few reasons why OSHA may inspect an employer's worksite: (1) the worksite's injury and illness rate places it within OSHA's Site-Specific Targeting program; (2) the occurrence of a work-related accident that causes a fatality or hospitalizes three or more employees; (3) a referral from another law-enforcement agency; (4) an inspector withesses a possible violation in "plain view" or from media reports; (5) an employee complaint; or (6) a follow-up from a previous inspection.

However, OSHA also has the authority to create regional and national emphasis programs for particular industries. Using that authority, OSHA has announced that it will inspect nursing homes and residential facilities nationwide that had a Days Away, Restricted, or Transferred ("DART") rate in 2010 of 10.0 or more. The directive implementing the NEP also states that each Area Office will inspect at least three nursing homes or residential facilities within its jurisdiction each year under this program. Thus, nursing homes or residential facilities with a 2010 DART rate of 10.0 or more should consult with their safety personnel and legal counsel to prepare for the likelihood of an OSHA inspection.

Third Circuit Court of Appeals Holds That Supervisors May Be Subject to Individual Liability Under the FMLA

Subhash Viswanathan — Thu, 29 Mar 2012 13:00:01 -0500

The Third Circuit Court of Appeals recently held, in Haybarger v. Lawrence County Adult Probation and Parole, that supervisors may be subject to individual liability under the Family and Medical Leave Act ("FMLA"). Although this Third Circuit decision is not binding on U.S. District Courts in New York or the Second Circuit Court of Appeals, the decision potentially opens the door for plaintiffs in FMLA cases filed in New York to name individual supervisors as defendants in their lawsuits.

In Haybarger, the plaintiff, Debra Haybarger, was an office manager for Lawrence County Adult Probation and Parole. Ms. Haybarger's supervisor was William Mancino, the Director of Probation and Parole. Ms. Haybarger had Type II diabetes, heart disease, and kidney problems, which constituted serious health conditions under the FMLA and caused her to miss work frequently to seek medical attention. Mr. Mancino allegedly expressed dissatisfaction with Ms. Haybarger's absences and wrote on her performance evaluation that Ms. Haybarger needed "[t]o improve her overall health and cut down on the days that she misses due to illness." On March 23, 2004, Mr. Mancino placed Ms. Haybarger on a six-month probationary period due to alleged performance problems, and subsequently recommended the termination of Ms. Haybarger's employment. Ms. Haybarger's employment was terminated on October 4, 2004.

After her discharge from employment, Ms. Haybarger filed a lawsuit against Lawrence County Adult Probation and Parole and Mr. Mancino. Part of her lawsuit included a claim against Mr. Mancino in his individual capacity for an alleged violation of her rights under the FMLA. The U.S. District Court for the District of New Jersey granted summary judgment to Mr. Mancino with respect to the FMLA claim against him in his individual capacity, but the Third Circuit reversed and remanded the case back to the District Court.

The Third Circuit examined the definition of "employer" under the FMLA, which includes "any person who acts, directly or indirectly, in the interest of an employer to any of the employees of such employer." The Third Circuit also reviewed the Department of Labor's regulations implementing the FMLA, which provide that "individuals such as corporate officers 'acting in the interest of an employer' are individually liable for any violations of the requirements of FMLA." Based on the text of the statute and the regulations, the Third Circuit concluded that "liability for FMLA violations may be imposed upon an individual person who would not otherwise be regarded as the plaintiff's 'employer.'" Although the employer at issue in the Haybarger case was a public agency, the Third Circuit's analysis appears to apply equally to individual supervisors at private employers as well.

The Third Circuit also held that there was a genuine dispute of material fact regarding whether Mr. Mancino exercised sufficient authority over Ms. Haybarger's employment to qualify as an "employer" under the FMLA, and remanded the case back to the District Court for a jury trial. The Third Circuit applied an "economic reality" test to determine whether a reasonable jury could determine that Mr. Mancino qualified as Ms. Haybarger's employer under the FMLA. Citing to a Second Circuit Court of Appeals case in the context of a Fair Labor Standards Act ("FLSA") claim, the Third Circuit examined the following factors in applying the "economic reality" test: (1) whether the individual had the power to hire and fire the employee; (2) whether the individual supervised and controlled employee work schedules or conditions of employment; (3) whether the individual determined the rate and method of payment; and (4) whether the individual maintained employment records. Based on these factors, the Third Circuit concluded that a reasonable jury could find that Mr. Mancino acted as Ms. Haybarger's employer under the FMLA.

Employers in New York should be aware that plaintiffs who allege a violation of their FMLA rights may name individual supervisors as defendants in their lawsuits. Employers should take this opportunity to train their supervisors regarding their obligations under the FMLA. Employers should also remind their supervisors that their actions could result not only in liability for the employer, but also potentially in liability for themselves.

New York Appellate Court Holds That Retirement Plan Contribution Dispute Was Not Arbitrable

Christopher T. Kurtz — Fri, 23 Mar 2012 13:52:03 -0500

In a recent decision that will likely have positive implications for similarly-situated public employers across New York State, the Appellate Division for the Second Department reversed a lower court ruling and held that the City of Yonkers' refusal to reimburse new employees for their statutorily-required Tier V retirement plan contributions was not arbitrable. The appellate court also issued a permanent stay of arbitration. The City of Yonkers ("City") was represented by Bond, Schoeneck & King in the litigation.

The dispute arose in connection with the 2009 enactment of Article 22 of New York's Retirement and Social Security Law ("Tier V"). Among other changes, Tier V provides that those who join the Police and Fire Retirement System ("PFRS") on or after January 10, 2010 must "contribute 3% of their salary towards the . . . retirement [plan] in which they are enrolled." Prior to the enactment of Tier V, the City and the Yonkers Fire Fighters ("Union") were parties to a collective bargaining agreement which expired on June 30, 2009. Like many other firefighter contracts in the state, the contract required the City to provide a "non-contributory" retirement plan to its firefighters.

In late 2009, the City hired several firefighters who, because of a "gap" in the law, had the option of joining the PFRS as either members of Tier III or Tier V -- both contributory (3%) tiers. In an attempt to apply the terms of the expired contract to relieve its Tier V members of the statutorily-required 3% member contribution, the Union filed a grievance and sought arbitration based upon the contractual obligation to provide a non-contributory requirement plan. The Union relied on an exception in the law creating Tier V, which provides that members of the PFRS need not join the contributory Tier V if there is an alternative retirement plan available to them under a collective bargaining agreement that "is in effect on the effective date" of Tier V. The appellate court found that the Union's reliance on this exception was misguided, because the collective bargaining agreement at issue had expired on June 30, 2009 and, therefore, was not "in effect" as of January 10, 2010, the effective date of Tier V.

The Union also asserted in its grievance that even if their new members were not eligible to join the non-contributory plan, the City was nevertheless obligated under the collective bargaining agreement to pay the new members' 3% contributions. The appellate court found that this claim was not arbitrable because Civil Service Law Section 201(4) and Retirement and Social Security Law Section 470 prohibit the negotiation of changes to benefits or fund payments related to a public retirement system.

As of the date of this blog post, the New York Court of Appeals is considering a motion filed by the Union for leave to appeal the decision. Regardless of whether our state's highest court chooses to hear the case or not, this issue is sure to surface again. Governor Cuomo's recent deal with the Legislature to establish a Tier VI in the various state retirement systems includes, among other things, a sliding-scale of increased employee contributions based upon annual salary (beginning at 3% and topping out at 6%). Thus, in some ways, the already high -- and very costly -- stakes have doubled.

U.S. District Court Denies Request for Stay of NLRB Posting Requirement Pending Appeal

Subhash Viswanathan — Mon, 12 Mar 2012 12:45:38 -0500

On March 7, 2012, the U.S. District Court for the District of Columbia denied a request made by the National Association of Manufacturers and other business groups to prohibit the NLRB from enforcing its rule requiring employers to post a notice of employee rights under the National Labor Relations Act, pending their appeal of the District Court's March 2, 2012 decision upholding the rule.

The District Court held that there would be no irreparable harm to employers if the NLRB's notice posting rule were permitted to become effective prior to the issuance of a decision by the U.S. Court of Appeals for the District of Columbia regarding the appeal, because the posting of the notice only makes employees aware "of the rights that they are already guaranteed by law." The District Court further stated: "If the Court of Appeals ultimately determines that the Board exceeded its authority in promulgating the Rule, the employers can take the notice down."

Accordingly, although an appeal of the District Court's March 2 decision has been filed, employers are required to post the notice beginning on April 30, 2012.

What the EEOC's Strategic Plan Means for Employers

Laura Harshbarger — Fri, 09 Mar 2012 15:39:26 -0500

On February 22, 2012, the Equal Employment Opportunity Commission ("EEOC") released its Strategic Plan for 2012-2016. The EEOC listed as a top priority increasing the number of systemic discrimination lawsuits against employers. Systemic cases allege a pattern or practice of discrimination or class discrimination. The basis of a systemic case is that the alleged discrimination affects a group of individuals rather than one particular individual. Merely by way of example, a systemic case may involve such allegations as a preference for younger workers in the hiring process, a sick time policy which results in the failure to accommodate individuals with disabilities, or a glass ceiling preventing the advancement of women within the organization.

In its Strategic Plan, the EEOC announced that it will devote more of its resources to finding and prosecuting systemic discrimination cases. Apparently, the EEOC intends to maximize the bang for its litigation buck. By suing employers in cases involving a large number of affected employees, the EEOC will be poised to extract larger monetary awards against employers. In each of the four years of the Strategic Plan, the EEOC states that systemic cases will be an increasing percentage of its litigation docket.

Employers need to be aware of the EEOC's focus on systemic discrimination. With this internal push to sue systemic discrimination cases, the EEOC almost certainly will seek to expand otherwise routine, single-complainant investigations in the hope of discovering facts to support systemic allegations. This is especially so if the discrimination charge involves a company rule or policy which arguably impacts many employees and not only the complaining party. As a proactive measure, a prudent employer should review its policies and practices to ensure compliance with EEOC guidelines and regulations, and to reduce the risk of a systemic discrimination lawsuit.

U.S. District Court Upholds NLRB's Notice Posting Rule, But Holds Certain Enforcement Provisions To Be Invalid

Subhash Viswanathan — Sun, 04 Mar 2012 20:53:41 -0500

On March 2, 2012, the U.S. District Court for the District of Columbia issued a decision in the lawsuit filed by the National Association of Manufacturers ("NAM") and the National Right to Work Legal Defense and Education Fund ("NRTW") challenging the notice posting rule promulgated by the National Labor Relations Board ("NLRB"). The Court held that the NLRB had the authority to require employers to post a notice informing employees of their rights under the National Labor Relations Act ("NLRA"), but did not have the authority to issue a blanket rule that failure to post the required notice will be considered an unfair labor practice and did not have the authority to permit tolling of the six-month statute of limitations for unfair labor practice charges in situations where an employer fails to post the required notice.

Although the Court determined that the NLRB exceeded its authority by promulgating a blanket rule that an employer's failure to post the required notice will in all cases constitute an unfair labor practice, the Court held that the NLRB is nevertheless free to determine on a case by case basis whether an employer's failure to post the notice interfered with employees' exercise of their rights under Section 7 of the NLRA. The Court stated that the NLRB can "make a specific finding based on the facts and circumstances in the individual case before it that the failure to post interfered with the exercise of his or her rights."

In addition, the Court also upheld the portion of the rule providing that the NLRB may consider an employer's failure to post the required notice as evidence of the employer's unlawful motive in unfair labor practice cases where motive is an issue. The Court found that the NLRB had the authority to issue this portion of the rule because the rule "does not make a blanket finding that will govern future individual adjudications or create a presumption of anti-union animus wherever an employer fails to post the provision." Therefore, although some of the NLRB's enforcement tools were struck down by the U.S. District Court for the District of Columbia, there could still be significant negative consequences to employers who fail to post the required notice.

It is not clear at this point whether the plaintiffs or the NLRB intend to appeal the Court's decision, or if an appeal will result in a delay of the effective date of the notice posting rule. Accordingly, employers should be prepared to post the required notice by the April 30, 2012 effective date.

Court of Appeals Holds That Workers' Compensation Exclusivity Provision Does Not Apply To Uninsured Motorist Benefits

Subhash Viswanathan — Fri, 02 Mar 2012 10:53:11 -0500

On December 13, 2011, the New York Court of Appeals held that an employee who drives his employer's vehicle, and has an automobile accident with an uninsured driver while driving his employer's vehicle during the course of his employment, is entitled to recover uninsured motorist benefits from his self-insured employer, notwithstanding the exclusivity provision of the New York Workers' Compensation Law.

In Matter of Elrac, Inc. v. Exum, Birtis Exum was employed by Elrac, Inc., and had an automobile accident while driving a vehicle owned by Elrac. The other vehicle involved in the accident was driven by an individual who did not have automobile liability insurance. Elrac was self-insured for automobile liability purposes, pursuant to Section 370(3) of the Vehicle and Traffic Law, so it had not obtained an insurance policy to cover the vehicle that Exum was driving.

Under Insurance Law Section 3420(f)(1), every motor vehicle liability insurance policy must contain a provision requiring payment to the insured of damages up to $25,000 in the case of injury and up to $50,000 in the case of death, in the event that the insured has an accident with an owner or operator of an uninsured motor vehicle. Because Elrac was self-insured, Exum sought to recover those damages directly from Elrac. Elrac argued that Exum was barred by the exclusivity provision of the Workers' Compensation Law from recovering uninsured motorist benefits, because Exum's injuries arose during the course of his employment.

The Court of Appeals disagreed with Elrac, holding that Exum's claim for uninsured motorist benefits submitted to his self-insured employer was not barred by the exclusivity provision of the Workers' Compensation Law because "[t]he situation is as though the employer had written an insurance policy to itself, including the statutorily-required provision for uninsured motorist coverage." The Court of Appeals reasoned that Exum would have been able to recover uninsured motorist benefits from an insurance company if Elrac had not been self-insured, and determined that those same benefits were recoverable directly from Elrac. Based on this reasoning, the Court of Appeals affirmed the Appellate Division's decision to allow Exum to proceed with his claim.

Supreme Court Declines to Review Court Decision Rejecting a Job Applicant's FLSA Retaliation Claim

Katherine Ritts Schafer — Tue, 28 Feb 2012 14:02:00 -0500

On February 21, 2012, the U.S. Supreme Court declined to review a Fourth Circuit Court of Appeals decision rejecting a job applicant's retaliation claim filed under the Fair Labor Standards Act ("FLSA") against her prospective employer. By declining to review the decision, the Supreme Court left undisturbed the Fourth Circuit's ruling that job applicants are not "employees" who are protected by the anti-retaliation provisions of the FLSA.

In Dellinger v. Science Applications International Corp., the plaintiff alleged that her prospective employer, Science Applications, retaliated against her by withdrawing its conditional job offer after discovering that she had filed an FLSA lawsuit against her former employer. In a 2-1 decision, the Fourth Circuit affirmed the U.S. District Court's dismissal of her retaliation complaint. The Fourth Circuit held that the FLSA anti-retaliation provisions applied only within the bounds of an actual current or former employment relationship, but did not authorize prospective employees to file retaliation claims against prospective employers in circumstances where an employment relationship never existed.

The plaintiff argued in her petition for Supreme Court review that the Fourth Circuit's decision conflicted with the Supreme Court's decision in Robinson v. Shell Oil Co., a 1997 decision addressing the scope of the anti-retaliation provisions of Title VII of the Civil Rights Act ("Title VII"). SAIC argued in its opposition to the plaintiff's petition that the Robinson case was factually distinguishable because the statutory language of Title VII expressly covers both employees and applicants and because the Robinson case involved a former employee of the defendant rather than a job applicant who had never been in an employment relationship with the defendant.

Although the Fourth Circuit's decision in the Dellinger case does not constitute binding precedent in the Federal Courts in New York, employers in New York can nevertheless rely on the Fourth Circuit's Dellinger decision as persuasive authority regarding the scope of the FLSA's anti-retaliation provisions.

NLRB's Acting General Counsel Issues Second Report on Social Media Cases

Sanjeeve DeSoyza — Thu, 23 Feb 2012 16:13:27 -0500

Last month, the Acting General Counsel for the National Labor Relations Board ("NLRB") issued a second report on 14 social media cases recently reviewed by his office. Although the report does not have the force of law, the report offers some insight into the NLRB's ongoing efforts to reconcile decades of federal labor law on protected employee speech under the National Labor Relations Act ("NLRA") with the new frontier of Twitter, Facebook, and other social media. Until the NLRB has issued more definitive rulings on the subject, employers should be mindful of the following in crafting their social media policies.

First, a broad "non-disparagement" clause in a social media policy is likely to be considered per se unlawful. For example, the Acting General Counsel found a policy that prohibited "making disparaging comments about the company through any media . . ." to be unlawful because it could reasonably be construed by employees to restrict their right under Section 7 of the NLRA to discuss wages and working conditions, and it contained no disclaimer language that made clear the policy was not intended to restrict such protected activity. Employers should avoid using broad and vague terms such as "disparaging," and should instead provide examples of prohibited conduct whenever possible.

Second, even a detailed disclaimer may not save an overly restrictive policy. In one case, the policy instructed employees not to identify themselves as working for the employer unless they were discussing terms and conditions of employment in an "appropriate" manner. The Acting General Counsel found the policy to be unsalvageable despite a lengthy disclaimer stating that the policy was not intended to restrict NLRA Section 7 rights and quoting NLRA Section 7 verbatim. The Acting General Counsel determined that employees still could not discern what types of discussions the employer considered to be "appropriate" or "inappropriate."

Third, restrictions on the disclosure of confidential or other non-public information should be worded such that they cannot be reasonably interpreted to impinge upon an employee's right to discuss wages, working conditions, and other subjects protected by NLRA Section 7. In rejecting one employer's policy which prohibited disclosure of "confidential, sensitive or non-public information concerning the company on or through company property," the Acting General Counsel determined that the language could reasonably be understood to prohibit employees from discussing subjects protected by NLRA Section 7. In contrast, the Acting General Counsel approved a pharmaceutical employer's policy prohibiting disclosure of confidential or proprietary information, including customers' personal health information and "embargoed information" such as product launch and release dates and pending reorganizations. He reasoned that an employee has no right to disclose "embargoed" corporate information and would understand that the remainder of the rule was intended to protect customer privacy interests and not to prohibit discussion about working conditions.

Fourth, a policy that requires employees to expressly state that their comments are their personal opinions, and not those of their employer, each and every time they post on social media sites, is regarded by the Acting General Counsel as an unlawful burden on employees' exercise of their NLRA Section 7 rights. However, the Acting General Counsel appears to have carved out an exception for policies that require such disclaimers where an employee's post involves the endorsement or promotion of the employer's products or services.

Prior blog posts regarding the NLRB's treatment of social media cases can be found here, here, here, and here.

DOL's "Updated" FMLA Forms List New 2015 Expiration Date

Kerry Langan — Mon, 20 Feb 2012 10:11:27 -0500

The U.S. Department of Labor ("DOL") recently issued "updated" Family and Medical Leave Act ("FMLA") model notices and medical certification forms. The prior notices and forms expired on December 31, 2011, but employers may now use the following DOL model notices and forms through February 28, 2015:

At this time, it does not appear as though the DOL has made any substantive changes to these model FMLA forms. In fact, the only modification that seems to have been incorporated by the DOL and the Office of Management and Budget ("OMB") is the new 2015 expiration date. These forms do not address important changes that have occurred since the FMLA was amended in November 2008. Specifically, these forms do not incorporate changes brought about by the 2010 amendments pertaining to military family leave (i.e., changes in exigency leave, the inquiry of a servicemember's past military service given the expanded definition of a "covered servicemember," etc.).

In addition, the DOL's forms do not contain the proposed "safe harbor" language that employers should insert on particular FMLA medical certification forms (e.g., WH-380-E) in order to avoid the disclosure of genetic information under the Genetic Information Nondisclosure Act of 2008 ("GINA"). In our January 14, 2011 blog post, we issued a reminder that employers may inadvertently obtain genetic information when they request that health care providers complete certification forms to support a leave under the FMLA or an accommodation request under the Americans with Disabilities Act ("ADA"). The GINA regulations, however, created a safe harbor for employers who integrate specific language (which is set forth in our January 14, 2011 blog post) into their requests for medical information in order to certify an employee's own serious health condition under the FMLA. In light of the fact that the DOL's FMLA model forms have not been amended to incorporate the GINA safe harbor language, we continue to recommend that employers take their own proactive measures to add and/or use the GINA safe harbor language when requesting medical information to certify an employee's own serious health condition under the FMLA.

It is entirely possible that the DOL will propose and/or make substantive changes to the FMLA model forms prior to February 2015, particularly because the DOL published its proposed changes to the FMLA regulations on February 15, 2012. The proposed changes to the regulations address topics such as military family leave, calculation of leave usage, and FMLA eligibility for flight crews. In the meantime, employers are encouraged to use the most recent published version of the FMLA model forms and to include any appropriate modifications needed to afford themselves protection under GINA's safe harbor provisions.

Business Groups and NLRB File Motions for Summary Judgment in Lawsuit Challenging Amendments to Representation Election Procedures

Subhash Viswanathan — Sun, 12 Feb 2012 14:04:31 -0500

The U.S. Chamber of Commerce and the Coalition for a Democratic Workplace filed a motion for summary judgment on February 3 in their court challenge to the National Labor Relations Board's final rule amending the procedures applicable to representation elections. In their motion for summary judgment, the business groups requested that the United States District Court for the District of Columbia invalidate the NLRB's amendments to the representation election procedures on several grounds, including: (1) the amendments were adopted by only two members rather than a three-member quorum; and (2) the final rule is inconsistent with the provisions of the National Labor Relations Act.

The NLRB also filed its own motion for summary judgment in the case on February 3, defending its rule-making process and seeking dismissal of the business groups' complaint.

Each party now has the opportunity to respond to the other party's motion by February 28. The NLRB's final rule is currently scheduled to go into effect on April 30. It is not clear at this point whether oral argument will be scheduled by the court or whether a decision will be issued by the effective date of the final rule.

New York's Highest Court Holds That "No Layoff" Clause in Public Employer's Collective Bargaining Agreement is Not Arbitrable

Colin Leonard — Fri, 03 Feb 2012 08:55:25 -0500

New York's highest court recently ruled that a provision in the collective bargaining agreement between the Village of Johnson City and its firefighters' union which states that the Village will not "lay-off any member of the bargaining unit during the term of this contract" is not explicit enough to prevent the Village from abolishing the positions of six firefighters and terminating their employment.

Under New York law, a "job security" provision in a public sector collective bargaining agreement violates public policy and is unenforceable unless, among other requirements, it explicitly prohibits the public employer from abolishing positions even due to budgetary constraints and the collective bargaining agreement that contains the provision is reasonable in duration. The public policy rationale for this stringent requirement is that public employers should not be hamstrung in their efforts to eliminate positions for economic reasons unless they have clearly promised to maintain employment levels for some reasonable period of time.

In the Village of Johnson City case, the Court of Appeals determined that the provision in the collective bargaining agreement prohibiting layoffs did not explicitly prohibit the Village from abolishing firefighter positions out of budgetary necessity. Accordingly, the Court of Appeals upheld the layoffs of the six firefighters and denied the union's application to compel the Village to submit to the arbitration process.

U.S. Department of Labor Releases Three Fact Sheets Regarding Retaliation

Katherine Ritts Schafer — Sun, 29 Jan 2012 20:21:40 -0500

Recently, the U.S. Department of Labor's Wage and Hour Division released three new Fact Sheets on unlawful retaliation under the Fair Labor Standards Act ("FLSA"), the Family and Medical Leave Act ("FMLA"), and the Migrant and Seasonal Agricultural Worker Protection Act ("MSPA"). Although the Fact Sheets do not contain any new information on the prohibition against retaliation, they provide a good reminder to employers regarding the scope of the anti-retaliation provisions in these three statutes.

Fact Sheet #77A provides general information concerning the FLSA's prohibition of retaliating against any employee who has filed a complaint or cooperated in an investigation. The Fact Sheet reminds employers that an employee who files a complaint under the FLSA is protected from retaliation regardless of whether the complaint was made orally or in writing. The Fact Sheet also states that the anti-retaliation provision of the FLSA applies even in situations where there is no current employment relationship; for example, former employees are also protected from retaliation. The Fact Sheet further indicates that complaints made to the Wage and Hour Division are protected and that "most courts have ruled that internal complaints to an employer are also protected."

Fact Sheet #77B provides general information concerning the FMLA's prohibition of retaliation against an individual for exercising his or her rights protected under the FMLA. The Fact Sheet provides examples of prohibited conduct, which include: discouraging an employee from using FMLA leave, manipulating an employee's work hours to avoid responsibilities under the FMLA, and counting FMLA leave as absences under "no fault" attendance policies.

Fact Sheet #77C provides general information concerning the MSPA's prohibition of discrimination against a migrant or seasonal agricultural worker who has filed a complaint or participated in any proceeding under the MSPA. The MSPA applies to agricultural employers, agricultural associations, and farm labor contractors who engage in at least one of the following activities: furnishing, employing, soliciting, hiring, or transporting one or more migrant or seasonal agricultural workers.

NLRB Holds That NLRA Prohibits Class Action Waivers in Mandatory Arbitration Agreements

Erin Sylvester Torcello — Thu, 26 Jan 2012 13:33:37 -0500

Arbitration agreements are a common tool that employers use to manage EEO and wage/hour litigation risk. Those agreements often include a provision that an employee who wishes to submit an employment-related claim to arbitration may do so only on behalf of himself or herself, and may not do so as part of a class or collective action. On January 3, 2012, Member Becker's last day on the National Labor Relations Board ("NLRB"), Members Becker and Pearce dealt a blow to employers seeking to create or expand arbitration agreements that employees are required to sign as a condition of employment. In D.R. Horton, Inc., the NLRB held that mandatory arbitration agreements that include a class action waiver are unlawful under the National Labor Relations Act ("NLRA").

In D.R. Horton, Inc., the employer (a home builder with operations in more than 20 states) instituted a corporate-wide policy that required new and current employees, as a condition of employment, to sign an arbitration agreement. The agreement required all disputes arising from each employee's employment to be resolved by an arbitrator, rather than in a judicial forum. The agreement further provided that the arbitrator had no authority to consolidate the claims of other employees, to hear any class or collective action, or to award relief to a class or group of employees.

The charging party, Michael Cuda, was a superintendent with the home building company. Cuda's attorney notified the company that his firm represented Cuda and a nationwide class of similarly situated employees. He asserted that the company was misclassifying the superintendents as exempt under the Fair Labor Standards Act ("FLSA") and gave notice that he intended to initiate an arbitration proceeding on behalf of the class of superintendents. The company responded that such a collective action was prohibited under the arbitration agreement that Cuda and other employees signed.

Cuda then filed an unfair labor practice charge with the NLRB, alleging, among other things, that the arbitration agreement violated Section 8(a)(1) of the NLRA as it prohibited employees from engaging in concerted activity for their mutual aid and protection.

The NLRB agreed with Cuda that the arbitration agreement violated Section 8(a)(1) of the NLRA. The NLRB held that employees have the right to attempt to improve their working conditions through judicial, administrative, and arbitral proceedings. The NLRB further held that employees' collective efforts to pursue rights or improve working conditions are "at the core of what Congress intended to protect" in Section 7 of the NLRA. The Board concluded that, because the arbitration agreement at issue prohibited employees from pursuing class or collective actions in either an arbitral or judicial forum, it violated Section 8(a)(1) of the NLRA.

The company argued that a decision holding its arbitration agreement to be unlawful would conflict with the provisions of the Federal Arbitration Act ("FAA") and the Supreme Court's 2011 decision in AT&T Mobility LLC v. Concepcion. However, the NLRB rejected these arguments.

The FAA was enacted to prevent courts from treating arbitration agreements less favorably than other private contracts. The NLRB reasoned that its decision was not in conflict with the FAA because it was treating the arbitration agreement no worse than any other private agreement. The NLRB stated that it would have reached the same conclusion had the agreement not mentioned arbitration, but required employees to pursue only individual claims -- rather than collective claims -- in a judicial or other type of forum.

In AT&T Mobility, a class action was brought against AT&T by a group of customers who alleged that AT&T's offer of a "free" telephone to anyone who signed up for its service was fraudulent to the extent that AT&T still charged new subscribers sales tax on the retail value of the "free" telephone. AT&T demanded that each plaintiff's claim be submitted to individual arbitration because its arbitration agreement with its customers barred class actions. The plaintiffs argued that such a class action waiver was unconscionable under California law. The Supreme Court rejected the plaintiffs' argument, and held that the class action waiver contained in the arbitration agreement was enforceable. The NLRB distinguished the Supreme Court's AT&T Mobility decision, principally on the basis that the arbitration agreement at issue in that case involved customers of AT&T rather than employees, and therefore, the issue of whether the arbitration agreement violated the NLRA was not presented.

The D.R. Horton case will likely be appealed to a U.S. Circuit Court of Appeals, and may eventually be heard by the Supreme Court. However, in the meantime, employers looking to create or expand an arbitration agreement that employees must sign as a condition of employment should be cautious not to prohibit employees from pursuing class or collective actions in an arbitral forum.

Bill Introduced in the New York State Legislature to Repeal the WTPA Annual Notice Requirement

Subhash Viswanathan — Tue, 24 Jan 2012 16:48:44 -0500

A bill has been introduced in the New York State Legislature that would, if enacted, repeal the annual wage notice requirement imposed by the Wage Theft Prevention Act ("WTPA"). The bill would leave intact the requirement that employers provide a wage notice to all new hires, as well as the requirement that employers obtain signed written acknowledgments of the new hire wage notices. At this point, the bill is in its infant stages, and no vote has been taken.

The Business Council of New York State has submitted a memorandum in support of the bill, and has created a web page for employers to join in the effort to convince the New York State Legislature to repeal the annual wage notice requirement.