Stoel Rives World of Employment

NLRB's Court Woes Continue: New Election Rules Struck Down

Tim O'Connell — Tue, 15 May 2012 05:05:32 -0800

The Obama NLRB’s regulatory agenda continues to fare poorly in the federal courts. On the heels of court decisions staying the NLRB’s new “notice” requirement, see previous posts here, the United States District Court for the District of Columbia Circuit has just struck down the NLRB’s new rules designed to speed up union representation elections.

Employers and their representatives have been concerned about the Board’s new election rules since they were issued in September. See our previous posting here. Employers’ concerns were heightened when the Board’s Acting General Counsel issued a “Guidance Memorandum” directing the Board’s Regional Offices on how to implement the new rules. That Guidance Memorandum is available here. That Guidance Memorandum articulated several “best practices” that would further accelerate the election process.

In response to the new rules, the US Chamber of Commerce and other groups sued the Board, citing a number of substantive and procedural objections to the new rules. Judge James Boasberg (an Obama appointee) struck down the Board’s decision solely on procedural reasons: the absence of a quorum. Just two years ago, the United States Supreme Court had emphasized the importance of the Board having a minimum of three members to act. The court had emphasized in New Process Steel that the quorum requirement is not, under the Taft-Hartley Act, a mere “technical obstacle.” Ironically, concern about the then-impending loss of a quorum in December, 2011, caused the Board to rush its normal internal processes. Member Hayes had previously expressed his opposition to the proposed rules. When the final proposed rules were circulated among the three Board members, member Hayes did not participate – but the two member majority adopted the rules anyway. The District Court concluded that the Board thus acted without a quorum:

“According to Woody Allen, 80% of life is just showing up. When it comes to satisfying a quorum requirement, though, showing up is even more important than that.”

In the absence of a lawful quorum, the rules were not properly adopted, and therefore must be struck down. The judge expressly did not reach any of the substantive objections to the rules.

This will likely raise substantial uncertainty in the near term. The Board could attempt to readopt the rules with its current membership – but doing so would only be more controversial: any quorum relying on the President’s “recess” appointments to the Board (made at a time when the Senate was not in recess!) will be subject to further attack. It is also not clear what course Regional Offices will take as to elections that were being handled under the now-stricken rules or what effect will be given to the Acting General Counsel’s “Guidance Memorandum.”

Employers should stay tuned for further developments – and if you receive a union election petition you should call your Stoel Rives labor lawyer immediately!

When to Pay Summer Interns: FLSA Guidance You Need to Know

Matt Durham — Fri, 04 May 2012 05:00:46 -0800

It's that time of year again, here's our post from last year from Matt Durham on this perennial summer concern for employers . . .

Certain things have become the recognizable signs of spring. Budding leaves. Flowers. Chirping birds. And summer intern resumes. Especially during a slow or recovering economy, HR professionals are likely to receive many resumes from eager students or recent graduates hoping to work as interns in order to gain valuable experience and networking opportunities. Often, intern candidates offer to work for nothing in exchange for the chance to learn about a job or industry.

Of course the idea, however enticing, of free labor should raise red flags. In fact, the United States Department of Labor (“DOL”) has made it clear that, unless specific criteria are met, student “interns” working at for-profit companies are actually student “employees,” subject to the minimum wage and overtime requirements of the Fair Labor Standards Act (“FLSA”). The DOL has identified the following six criteria for determining whether an individual meets the test for an unpaid intern:

The internship, even though it includes actual operation of the facilities of the employer, is similar to training which would be given in an educational environment;
The internship experience is for the benefit of the intern;
The intern does not displace regular employees, but works under close supervision of existing staff;
The employer that provides the training derives no immediate advantage from the activities of the intern; and on occasion its operations may actually be impeded;
The intern is not necessarily entitled to a job at the conclusion of the internship; and
The employer and the intern understand that the intern is not entitled to wages for the time spent in the internship.

Only if an internship program meets all of these requirements can participants be considered unpaid interns. And as you can imagine, meeting all of these requirements can be challenging. For example, the internship program must be structured around classroom or academic experience rather than around the employer’s business operations. For this reason, compliant programs are often developed and overseen by colleges or universities, which then give academic credit for participation. Moreover, the more the interns perform productive work for the employer (as opposed to job shadowing or similar activities), the more likely they will be deemed employees, entitled to minimum wage and overtime under the FLSA. You can find the DOL’s fact sheet on internship programs here.

At the end of the day, private employers seeking to benefit directly from eager students or graduates willing to work for the experience will find it difficult to meet DOL requirements. On the other hand, a company willing to provide work experience in order to be a good corporate citizen or to build relationships with schools or students, can structure an unpaid student intern program to meet those goals and comply with the law.

Legal Update: Transgender Employees Protected Under Title VII

Karen L. O'Connor — Wed, 25 Apr 2012 14:05:12 -0800

On Friday, April 20, 2012, the EEOC issued a landmark ruling that intentional discrimination against a transgender individual is discrimination “based on … sex” and thus violates Title VII. Prior to this ruling, the EEOC generally declined to pursue discrimination claims that arose from transgender status or gender identity issues.

What does this mean for employers? In California, Oregon and Washington, state laws have protected transgender employees by prohibiting discrimination based on gender identity and gender expression. For employers in those states, this ruling raises the stakes: transgender employees with discrimination claims can now bring both state and federal claims, instead of being limited to a state court action. For employers in all states, the EEOC ruling provides new protections and is an important reminder of the evolving law of sex-based discrimination.

Read the entire alert here.

UPDATE: NLRB Postpones Posting Rule Indefinitely

Jim Shore — Fri, 20 Apr 2012 12:58:27 -0800

In response to two federal court cases we previously blogged about here and here, the NLRB has indefinitely postponed implementation of its notice posting rule pending appeals in both of those cases. The bottom line is that no employer needs to post the notice for the time being.

The U.S. Court of Appeals for the D.C. Circuit will hear the NLRB’s appeal of an emergency injunction that court issued against the rule, but the hearing will not occur before September 2012. In the trial court ruling in that case, the judge found the NLRB's posting rule valid, but its enforcement provisions invalid. The NLRB is also appealing the South Carolina federal trial court decision we previously blogged about, in which a judge deemed the NLRB's entire posting rule invalid. No schedule has yet been set for the South Carolina appeal.

See the NLRB’s statement about this issue here.

California Supreme Court Clarifies Meal and Rest Break Requirements Under State Law

Tony DeCristoforo — Thu, 19 Apr 2012 06:24:56 -0800

In its long-anticipated decision in Brinker v. Superior Court, a unanimous California Supreme Court has clarified the scope of an employer’s obligation to provide meal and rest breaks to non-exempt employees in California. The Court's full opinion is available here.

Meal Breaks

California law requires employers to provide employees with a meal period of not less than 30 minutes for workdays lasting more than five hours, and to provide two meal periods for workdays in excess of ten hours, subject to waiver in certain circumstances. At issue in Brinker was whether an employer must ensure that an employee’s work stops for the required 30 minutes, or whether an employer is only obligated to make meal periods available, with no responsibility for whether they are taken. The Court concluded that an employer’s obligation is to relieve its employee of all duty, with the employee thereafter at liberty to use the meal period for whatever purpose he or she desires. The employer must relinquish control over its employee’s activities and give the employee a reasonable opportunity to take an uninterrupted 30 minute break, and the employer may not impede or discourage the employee from doing so. However, the employer is not obligated to police meal breaks and ensure no work is performed.

Timing of Meal Breaks

The Court held that an employer must provide a first meal period no later than the end of an employee’s fifth hour of work, and a second meal period no later than the end of an employee’s tenth hour of work. The Court found that there are no additional timing requirements, such as rolling five hour meal periods.

Rest Periods

Under California law, employers must authorize and permit employees to take rest periods based on the total hours worked daily, at the rate of ten minutes net rest time per four hours worked or major fraction thereof. A rest period need not be authorized for employees whose total daily work time is less than three and one-half hours. The Court summarized the rest period obligation as follows: employees are entitled to ten minutes’ rest for shifts from three and one-half hours to six hours in length, 20 minutes for shifts of more than six hours up to ten hours, 30 minutes for shifts of more than ten hours up to 14 hours, and so on. The 10-minute breaks must fall within the middle of a four hour period of work, to the extent practicable.

Timing of Rest Periods

The Court held that employers do not have a duty to permit their employees a rest period before any meal period.

What Brinker Means For Employers

Brinker is generally regarded as a favorable ruling for employers, and the decision provides a roadmap for employers to reduce the risk of claims arising from alleged meal and rest period violations. Post-Brinker, it is essential that California employers carefully review and, if necessary, revise policies to state that meal periods are duty-free, 30 minutes in length and are to be taken before the end of the fifth hour of work. Rest period policies should now detail that rest periods are authorized and permitted in accordance with the specific standards set forth above.

Employers should continue to require employees to clock out and in for meal breaks, and to carefully monitor and manage whether employees are working through their meal periods. Employers are liable for straight time or overtime pay if they know or should have known employees have worked through meal breaks. If an employee is not clocking out for meals, an employer would likely be found to be on notice that the employee continued to work and thus should be paid for that time. Additionally, if there is a pattern of employees not taking meal periods, or taking meal periods of less than 30 minutes in length or after the end of the fifth hour of work, management should look into whether the employees are really being given the opportunity to take timely 30-minute off-duty meal periods.

Finally, supervisors and managers should be trained on the importance of allowing employees to take meal and rest periods as prescribed in Brinker. While the outcome in Brinker is good news for employers, managers who discourage or prevent employees from taking meal or rest breaks will expose the company to substantial liability.

UPDATE: DC Court of Appeals Delays Implementation of NLRB Posting Requirement

Jim Shore — Tue, 17 Apr 2012 11:42:07 -0800

The NLRB’s new posting rule, which would apply to virtually all private sector employers, was scheduled to go in effect on April 30, 2012. Yesterday, we blogged about a South Carolina federal trial court decision striking down the posting rule. More good news for employers arrived today, as the United States Court of Appeals for the District of Columbia issued an emergency injunction preserving the “status quo” and delaying implementation of the NLRB’s posting rule until that Court of Appeals determines its validity. The D.C. trial court had previously determined the posting rule was valid (contrary to the South Carolina case) but that its remedies were invalid. Oral argument in the D.C. appellate case is currently estimated to occur in September 2012. A copy of the D.C. Court of Appeals injunction decision is here.

We now have two courts that have stymied the NLRB posting rule. It is still unknown whether the NLRB will appeal the South Carolina and D.C. Court of Appeals decisions. But for now, absent an emergency appeal, it appears that the NLRB’s posting rule will, at a minimum, be delayed for several months. We will keep you “posted” as developments occur.

South Carolina Federal Court Holds NLRB's Notice Posting is Unlawful

Jim Shore — Mon, 16 Apr 2012 07:00:50 -0800

As previously blogged here, a federal court located in the District of Columbia upheld the National Labor Relations Board's (“NLRB”) rule requiring nearly all private sector employers, whether unionized or not, to post a notice to their employees about certain employee rights under the National Labor Relations Act. While upholding the rule, that federal court did at least strike down the rule’s main enforcement provisions. A copy of that federal court decision is here. As we blogged then, another legal challenge to the NLRB’s rule was also pending in a South Carolina federal court. That decision is now here, and it is a good one for employers.

The U.S. Chamber of Commerce and the South Carolina Chamber of Commerce challenged the NLRB’s rule. On April 13, 2012 (perhaps Friday the 13^th from the NLRB’s perspective), the federal judge in that South Carolina case ruled that the NLRB’s entire posting rule is invalid, finding the NLRB exceeded its authority when it required employers to post notices explaining workers’ rights to form a union. In his ruling, the South Carolina federal judge said the NLRB lacked the legal authority to issue the notice and thus the rule was not lawful. “Based on the statutory scheme, legislative history, history of evolving congressional regulation in the area, and a consideration of other federal labor statutes, the court finds that Congress did not intend to impose a notice-posting obligation on employers, nor did it explicitly or implicitly delegate authority to the Board to regulate employers in this manner,” the court ruled.

Many labor law professionals feel that the NLRB has become overly aggressive in supporting and expanding union rights during the Obama administration. This sentiment is especially strong in a conservative state like South Carolina, which also was at the center of a now-settled dispute between the NLRB and Boeing over Boeing’s decision to move production of its 787 Dreamliner airplane from Washington State to South Carolina. The South Carolina federal judge appears to agree that the NLRB is becoming overly aggressive, stating, “The Board also went seventy-five years without promulgating a notice-posting rule, but it has now decided to flex its newly-discovered rulemaking muscles.” A copy of the South Carolina decision is here. Its authority is technically legally limited to that particular court, but because of its import we expect it to have an effect nationally as the NLRB seeks to regroup and rethink what it will do. If the NLRB does not appeal the South Carolina court’s decision, the ruling will stand and, from a practical perspective the posting requirement will be invalidated nationally. But most pundits anticipate that the NLRB will file an appeal over the South Carolina decision.

The bottom line is that we now have two conflicting federal court rulings on the issue, and await the NLRB’s decision on whether it will appeal the South Carolina ruling, and/or delay implementation of its previously stated April 30, 2012 posting deadline. Stay tuned.

9th Circuit: Attendance Is Essential Job Function For NICU Nurse Under ADA

Jim Shore — Mon, 16 Apr 2012 06:00:00 -0800

This week the federal Ninth Circuit Court of Appeals provided some help to employers seeking to balance the need to accommodate disabled employees with the need to enforce regular attendance policies. In Samper v. Providence St Vincent Medical Ctr, the Ninth Circuit held that the Americans with Disabilities Act (“ADA”) did not require an Oregon hospital to exempt a neo-natal intensive care unit (“NICU”) nurse, whose fibromyalgia caused frequent absences, from its attendance policy. The case helps illustrate both when employers should be flexible in accommodating disabilities that could affect attendance, and also when they may be entitled to require stricter adherence to attendance policies.

The Facts Of Samper
The defendant in Samper, St. Vincent Hospital in Portland, Oregon, had little trouble demonstrating that strict adherence to its attendance policy was essential for NICU nurses, who care for a very vulnerable patients, need to be in the NICU to do their jobs, and must be able to respond quickly in emergency situations. The NICU nurse job description specifically identified attendance as an essential job requirement. Further, NICU nurses have specialized training making it more difficult to find replacements during absences. And despite the need for good attendance, the hospital policy nevertheless “generous[ly]” allowed nurses up to five unexcused absences per year.

The plaintiff, Ms. Samper, worked as a part-time NICU nurse since about 2000. From early on, she was disciplined or received multiple poor performance reviews in part because of unexcused absences in excess of the policy's 5-day per year limit. In 2005, she began suffering from fibromyalgia, which caused more absences. St. Vincent initially was able to accommodate her disability; first, it allowed her to call in on bad days and move her shift to another day. Later, it adjusted her schedule so she would not work on consecutive days. The hospital also provided Samper numerous extended leaves of absence, including for personal reasons unrelated to her disability. Ultimately, however, in 2008 St. Vincent terminated Ms. Samper’s employment for, among other reasons, her continued unexcused absences in excess of the policy. Ms. Samper sued, claiming in part that the hospital failed to reasonably accommodate her disability by not exempting her altogether from the 5-day limit under the attendance policy.

The Ninth Circuit found that her Ms. Samper’s request to be exempted from the attendance policy was not a reasonable accommodation as a matter of law. In reaching its conclusion, the Court first noted that the hospital’s written job description stated in several places that attendance and punctuality were essential functions. The Court also surveyed a number of other cases where courts found attendance to be an essential function, such as where employees must work in a team with other employees, where they regularly must interact with customers or clients (such as teachers and airline ticket agents), or are required to be on-site to work with special equipment (such as in a manufacturing environment). Ultimately, the Court found that attendance for NICU nurses was even more essential than in any of those other situations, considering the importance of their “specialized, life-saving work” and the difficulty of finding replacements due to the specialized training NICU nurses receive.

When Is Attendance An Essential Function Under the ADA?
The reasoning in Samper probably provides a mixed bag for other employers trying to balance attendance and accommodation needs. On the one hand, the case provides a ringing endorsement for the general principle that attendance can be an essential function of most jobs, absent evidence it is not, in fact, necessary. Indeed, the Court stated as a general “rule” and matter of “common sense” that: “Except in the unusual case where an employee can effectively perform all work-related duties at home, an employee who does not come to work cannot perform any of his job functions, essential or otherwise.” (emphasis added)

On the other hand, the detailed discussion of the facts and overall subtext of the case suggest that the court’s holding may not be as broad as employers might hope. For example, the fact that NICU nurses provide care to vulnerable infants fighting for their lives probably helped tip things in the hospital’s favor; few other jobs will be able to demonstrate such urgency. In addition, for positions that don’t require as much specialized training as NICU nurses, attendance may be less essential if the employer can more easily find qualified replacements on short notice when a disabled employee is absent.

Perhaps most importantly, the hospital demonstrated flexibility in applying its attendance policy and had a demonstrated track record in accommodating Ms. Samper in the past. It did not enforce its attendance policy too strictly; instead, it allowed up to five unexcused absences per year. In addition, the hospital made “Herculean” attempts to accommodate Ms. Samper over a nearly eight-year period, including allowing absences in excess of the policy, providing numerous leaves of absence, and adjusting her schedule several times. The Court only found that her final request—to be exempted from the attendance policies altogether—was unreasonable. While those efforts are technically distinct from whether attendance is an essential function of a job, the Court obviously believed the hospital had already bent over backwards repeatedly to try to accommodate Ms. Samper. Had the hospital terminated her employment for a first time attendance violation or without the accommodation history, the case could have come out differently. In that sense, Samper could serve as a reminder that employers often cannot do enough to engage in the interactive process and attempt accommodation where reasonable.

EEOC Issues Final Regulations for RFOA Defense Under ADEA

Todd Hanchett — Tue, 10 Apr 2012 06:00:00 -0800

Last week, we reported that several senators had introduced new amendments to the Age Discrimination in Employment Act ("ADEA") to make it easier for plaintiffs in age discrimination cases to prove their claims. U.S. Senators aren't the only ones busy refining federal age discrimination laws - on March 30, 2012, the Equal Employment Opportunity Commission (EEOC) published its final rule on the “reasonable factors other than age” (RFOA) defense under the ADEA. Acting in response to two U.S. Supreme Court cases, Smith v. City of Jackson in 2005 and Meacham v. Knolls Atomic Power Laboratories in 2008, the rule bring the EEOC regulations in line with Supreme Court precedent and clarifies the scope of the RFOA defense.

In Smith, the Supreme Court held that disparate impact claims are cognizable under the ADEA. The Court further held that a practice having a disparate impact on older workers need only be justified by “reasonable” factors other than age; an employer need not satisfy the more rigorous “business necessity” defense applicable to Title VII claims. In Meacham, the Court held that the employer bears the burden of production and persuasion on the RFOA defense.

The regulation points out that the EEOC believes that “reasonable” factors other than age reflects a higher standard than a simple “rational basis” standard. According to the EEOC, equating the RFOA defense with a rational-basis standard would improperly conflate ADEA disparate-treatment and disparate-impact standards of proof: “If an employer attempting to establish the RFOA defense were only required to show that it had acted rationally, then the employer would merely be required to show that it had not engaged in intentional age discrimination.”

The rule provides a non-exhaustive list of factors to be considered in determining whether an employment practice is based on RFOA:

The extent to which the factor is related to the employer’s stated business purpose;
The extent to which the employer defined the factor accurately and applied the factor fairly and accurately, including the extent to which managers and supervisors were given guidance or training bout how to apply the factor and avoid discrimination;
The extent to which the employer limited supervisors’ discretion to assess employees subjectively, particularly where the criteria that the supervisors were asked to evaluate are known to be subject to negative age-based stereotypes;
The extent to which the employer assessed the adverse impact of its employment practice on older workers; and
The degree of the harm to individuals within the protected age group, in terms of both the extent of injury and the numbers of persons adversely affected, and the extent to which the employer took steps to reduce the harm, in light of the burden of undertaking such steps.

The final rule makes clear that the EEOC will take a very dim view of an employer’s RFOA defense where supervisors are given broad discretion to make subjective decisions. Accordingly, prudent employers will take steps to ensure that decisions are made consistent with business purpose, that supervisors are properly trained, and that supervisors exercise their discretion in a way that does not violate the ADEA.

For more information, visit EEOC’s Questions and Answers page. The rule will take effect on April 30, 2012.

Senators Propose Amendments To ADEA

Todd Hanchett — Tue, 03 Apr 2012 06:00:00 -0800

On March 12, several senators introduced Senate Bill 2189, known as the Protecting Older Workers Against Discrimination Act, which would overturn a 2009 U.S. Supreme Court case, Gross v. FBL Financial Services Inc, that had made it more difficult for older workers to prove claims under the Age Discrimination in Employment Act ("ADEA"). Under the new bill, it would be much easier for employees to prove age discrimination in many cases.

In the Gross case, the Supreme Court held, by a 5-4 margin, that the “mixed motive” analysis of discrimination claims was not available under the ADEA, and that plaintiffs asserting age discrimination must prove that age was the “but for” cause of the adverse employment action. The Supreme Court reasoned that the Civil Rights Act of 1991, which codified the mixed motive analysis in cases of race, sex, and other protected statuses, only applied to Title VII of the Civil Rights Act of 1964 and not the ADEA, which is a separate statutory scheme. Under Gross, in ADEA cases the plaintiff was required to prove that age was the “but for” cause of the employment action, not simply a motivating factor.

This bill is sponsored by Senators from both parties (Sen. Harkin [D-IA], Sen. Grassley [R-IA], and Sen. Leahy [D-VA]), but exactly how much support it has remains to be seen. Similar bills were introduced in both the House and Senate in 2009, but neither were voted on. It remains to be seen whether this bill will gain traction or suffer a similar fate.

When Does Alcohol or a Controlled Substance Preclude Workers' Compensation Benefits?

Cameron L. Ward — Tue, 27 Mar 2012 06:00:00 -0800

Like most states, Utah’s Worker’s Compensation statute prohibits an employee from recovering disability compensation when “the major contributing cause of the employee’s injury” is the employee’s unauthorized use of alcohol or a controlled substance. See Utah Code Ann. § 34A-2-302(3)(b). If any amount of a controlled substance or its metabolites is found in an injured employee’s system at the time of the injury, the Worker’s Compensation statute presumes that drug use was the major contributing cause of the injury.

An employee can rebut this presumption by:

challenging the accuracy of the drug test;
demonstrating that he or she did not actually use a controlled substance;
providing expert medical opinion suggesting that the level of controlled substance in the employee’s system does not support a finding that drug use was the major contributing cause of the injury; or
otherwise demonstrating that drug use was not the major contributing cause of the injury.

A Utah appellate court recently weighed in on this issue when it reversed the Utah Labor Commission’s denial of disability compensation to James Barron in Barron v. Labor Commission.

Mr. Barron was severely injured while at work when he stepped backward off the edge of temporary metal decking at a construction site and fell fourteen feet to a concrete floor below. A urine sample taken at the hospital on the day of the accident tested positive for cocaine metabolites. Mr. Barron admitted to sharing a quarter of a gram of cocaine with a friend two days before the accident but presented evidence tending to demonstrate he was not impaired at the time of the accident, including testimony from co-workers and medical personnel who observed Mr. Baron’s conduct on the day of the accident.

Applying the statutory presumption, the Commission ignored Mr. Barron’s evidence of non-impairment and found that drug use was the major contributing cause of his injury. Specifically, the Commission determined that Mr. Baron must demonstrate that “some other force” apart from his own actions caused his injury to overcome the presumption. Following case law from a number of other states with similar statutory schemes, the Utah Court of Appeals reversed the decision of the Commission and, for the first time, clarified that employees are not required to show that their injury was the result of an outside force to overcome the statutory presumption. Rather, evidence of non-impairment at the time of the accident may be used to rebut the presumption and to demonstrate that drug use was not the major contributing cause of injury.

So, when does the use of alcohol or a controlled substance preclude workers' compensation benefits? The answer: almost always, but not when employees can demonstrate that they are not impaired, despite the presence of controlled substances within their systems.

NLRB Posting Requirements - Update

Jim Shore — Tue, 06 Mar 2012 06:00:00 -0800

Update: A federal trial court in the District of Columbia has upheld the notice posting requirement in the National Labor Relations Board's (“NLRB”) recently issued final rule requiring nearly all private sector employers, whether unionized or not, to post a notice to their employees about certain employee rights under the National Labor Relations Act. To view the Court's decision, click here. The court also held, however, that the rule’s main enforcement provisions, including making an employer’s failure to post a per se unfair labor practice, are invalid. Unless this decision is overturned or another court finds the rule to be invalid, the notice posting requirement will still take effect April 30, 2012. An appeal is likely in the District of Columbia case, and at least one other court challenge is pending in South Carolina.

For additional information regarding the NLRB's rule and posting requirement, including links to the rule and the poster employers must post, see our prior discussion on this topic by following this link.

Are Remedies Available to Working Moms Who Experience "Lactation Discrimination"?

Lauren Shurman — Fri, 17 Feb 2012 06:00:00 -0800

For many new moms returning to work after the birth of a child, pumping breast-milk is considered to be a necessary evil. Necessary because pumping ensures that these mothers’ babies can continue to experience the many benefits of breast-milk, and helps the mothers to maintain their milk supplies, relieves painful engorgement, and prevents potentially serious medical conditions like mastitis. Evil because, well, it is not exactly fun to do, especially if the workplace is not supportive. The U.S. Centers for Disease Control reports that full-time work for new mothers is “significantly associated with lower rates of breastfeeding initiation and shorter duration,” due primarily to workplace barriers such as “a lack of flexibility for milk expression in the work schedule, lack of accommodations to pump or store breast-milk, concerns about support from employers and colleagues, and real or perceived low milk supply.” Click here to view CDC's report.

One mother recently faced with this predicament is Donnicia Venters, who alleged in a federal lawsuit that her employer fired her while she was on maternity leave when she inquired about using a back room in the office to pump milk upon her return from leave. The EEOC brought suit on Ms. Venters’ behalf in the United States District Court for the Southern District of Texas, asserting sex discrimination claims against the employer under Title VII. See EEOC v. Houston Funding II, Ltd., Case No. 4:11-cv-02442 (S.D. Tex.). Title VII makes it “an unlawful employment practice for an employer . . . to discharge any individual . . . because of such individual’s . . . sex.” 42 U.S.C. § 2000e-2(a)(1). The Pregnancy Discrimination Act amended Title VII to state that “‘because of sex’ … include[s] … because of … pregnancy, childbirth, or related medical conditions ….” 42 U.S.C. §2000e(k).

United States District Judge Lynn N. Hughes (who is a male, for the record) recently granted summary judgment in favor of the employer, ruling that “[f]iring someone because of lactation or breast-pumping is not sex discrimination.” In a rather conclusory fashion, the court reasoned that “lactation is not pregnancy, childbirth, or a related medical condition” and that any “pregnancy-related conditions” experienced by Ms. Venters ended on the day she gave birth to her daughter. To see the full opinion click here.

In the few short days since it has been issued, this ruling has garnered much critical attention. As many commentators have pointed out—and this seems quite obvious—only women can lactate, and lactation does not usually happen in the absence of childbirth. The ruling therefore strikes many as illogical—how can firing someone for lactation or breast-pumping not be because of sex or a childbirth-related medical condition? The EEOC has stated that it is considering whether to appeal the ruling. The issue therefore remains far from settled. It remains to be seen whether the appellate court, or other judges who might be faced with this issue, will come to a different conclusion than Judge Hughes did.

Pumping mothers also have a new legal protection that Ms. Venters did not have when she gave birth to her baby in 2008. Effective March 23, 2010, the Patient Protection and Affordable Care Act (also known as the Healthcare Reform Act) amended the Fair Labor Standards Act (FLSA) to require employers to provide a nursing mother break time to pump. Specifically, covered employers must provide reasonable break time for an employee to express breast-milk for her nursing child for one year after the child’s birth, each time the employee has need to express milk. See 29 U.S.C. § 207(r). Employers must also provide a place, other than a bathroom, that is shielded from view and free from intrusion from coworkers and the public, which may be used by an employee to express breast-milk. Id.

There are, of course, several limitations to this protection. The FLSA amendment does not require employers to pay employees for such break time. Id. The requirements also do not apply to employers with less than 50 employees, if such requirements would impose an undue hardship by causing the employer significant difficulty or expense when considered in relation to the size, financial resources, nature, or structure of the employer’s business. Id.

Under this amendment, nursing mothers who experience “lactation discrimination” in the workplace might now have a remedy—albeit a limited one—under the FLSA. The FLSA makes it illegal for an employer to “discharge or in any other manner discriminate against any employee because such employee has filed any complaint or instituted or caused to be instituted any proceeding under or related to [the FLSA].” 29 U.S.C. § 215. In most jurisdictions, this provision applies to any employee who complains about an FLSA violation, either formally to an administrative agency, or informally to the employer. A nursing mother who complains about her employer’s failure to provide reasonable break time for her to pump would therefore be protected by this anti-retaliation provision in the FLSA. As the language of this anti-retaliation provision makes clear, however, the employee must actually complain to the employer in order to be protected. Thus, if Judge Hughes’ opinion turns out to be the prevailing view and lactation is not protected under the Pregnancy Discrimination Act or Title VII, there is still a gap in protection, even with the FLSA amendment. Nursing mothers who are simply fired for pumping at work before ever complaining about an employer’s FLSA violation would have no remedy. In this scenario, a legislative amendment to Title VII, or legislation at the state level, might be the only potential source of protection.

In fact, many states have attempted to fill the gaps in protection for nursing mothers by passing their own legislation. A complete list of state laws enacted to protect breastfeeding can be found here. Of the states where Stoel Rives has offices, California, Oregon, and Minnesota each have laws that require employers to provide breaks for women to breastfeed or pump. To the extent these state laws are more robust than the FLSA amendment, they are not preempted. see 29 U.S.C. § 207(r)(4).

Guidance on Terminations in Alaska

Meghan Kelly — Mon, 13 Feb 2012 07:00:00 -0800

Two recent opinions from the Alaska Supreme Court offer helpful guidance to employers regarding termination processes.

In Barickman v. State, an employer suspected an employee of theft. When confronted, the employee signed a letter of termination and then wrote a letter stating that he was resigning to avoid a “black mark on his record.” The employee later sued, alleging wrongful termination based on breach of good faith and fair dealing.

To win a claim of wrongful discharge in Alaska, the employee must show that (1) he was discharged by his employer and (2) that the employer breached a contract or committed a tort in connection with the termination. Here, the employee argued that his employer terminated him in bad faith, treated him differently than similarly situated employees, and failed to conduct a reasonable investigation before deciding to fire him.

Alaska law provides that when an employer makes a good faith determination that misconduct has occurred, there is no breach of the implied covenant of good faith and fair dealing, even if the employee can subsequently prove that the factual finding of misconduct was a mistake. Here, the Supreme Court found that the employee did not raise any facts alleging that the employer’s determination was made in bad faith, particularly since the employer provided a spreadsheet showing instances where other employees accused of similar charges were dismissed or asked to resign. The Court ultimately held that the employer did not breach its duty of good faith and fair dealing. The Court likewise found that the employee failed to present enough evidence on the issues of whether the employer had treated him differently than other similarly situated employees or whether the employer’s investigation was unreasonable.

Boyko v. Anchorage School District involved a teacher who sued the Anchorage School District, one of Alaska’s largest employers. The parties had entered into a verbal resignation agreement wherein the employer promised not to release any negative information about the teacher to prospective employers. The teacher claimed that the District had provided information that was not positive to another school district, and that these actions breached the termination agreement, violated the covenant of good faith and fair dealing, and interfered with her prospective contractual relations. She also claimed disability discrimination, because the termination stemmed from incidents associated with the teacher’s drinking problem. The employer won on summary judgment all counts in the lower court, where the court found that the employer was immune under an Alaska statute (see AS 09.65.160) immunizing employers who disclose job performance information in good faith.

The Supreme Court largely disagreed, finding that evidence the teacher produced in the trial court raised sufficient factual issues as to whether the District had breached the resignation agreement, and therefore whether the District had violated the covenant of good faith and fair dealing and interfered with the teacher’s prospective contractual relations. The Court also noted that statutorily-created rights can be waived where there is “direct, unequivocal conduct indicating a purpose to abandon or waive the legal right.” Ultimately, the Court found that whether such a waiver occurred through the District’s verbal negotiation of a resignation agreement was in itself a material issue of fact, and remanded the claim to the lower court.

It was not all bad for the employer. On the disability claim the court found that District had provided a legitimate, nondiscriminatory reason for the dismissal and that the teacher had not raised sufficient doubts as to whether the reason was a pretext. Therefore, the Court affirmed the lower court’s entry of summary judgment on the claim.

Four Practical Tips For Terminations:

Always act in good faith and deal fairly with employees.
Consider whether termination of employment is consistent with applicable policies and past practices.
Good documentation demonstrates process (and calm reflection).
Be careful what you say at termination – it can become an oral contract.

Melanie Osborne contributed to this post.

NLRB Finds Employee Arbitration Agreement Waiving Class Claims Violates Federal Labor Law

Dan Mueller — Tue, 10 Jan 2012 06:00:00 -0800

In DR Horton, a decision issued on January 3 and applicable to most private sector employers, whether unionized or not, the National Labor Relations Board (NLRB) held that federal labor law prevents employers from requiring their employees, as a condition of employment, to agree to broad waivers that would deny their right to pursue employment-related class actions both in court and in arbitration, leaving them no forum for pursuing class or collective claims. As a result, an important tool for managing the risk of employment-related litigation has been taken away (for now).

The facts of the case are straightforward. DR Horton, like many employers, required its employees to sign an arbitration agreement as a condition of employment. The agreement required employees to arbitrate all claims arising out of their employment, and precluded arbitrators from issuing class or group relief. As a result, employees were prevented from bringing class or collective actions in any forum. Relying on this agreement, DR Horton refused to arbitrate a class action alleging that it had misclassified certain employees as exempt from the protections of the Fair Labor Standards Act (FLSA).

Not so fast, according to the NLRB. Tracing federal labor law back to its origins, the NLRB found that the filing of a class action “to redress workplace wrongs or improve working conditions” is activity at “the core” of what Congress intended to protect when it enacted the National Labor Relations Act in 1935. This intent, the NLRB reasoned, is reflected in Section 7 of the Act, which gives employees the right to engage in “concerted activities” for the purposes of “mutual aid or protection.” Relying on Section 7, the NLRB found that Employers cannot compel their employees, as a condition of employment, to entirely waive the right to bring class or collective actions.

The NLRB’s ruling in DR Horton clashes with the U.S. Supreme Court’s recent decision in AT&T Mobility v. Concepcion, which held that arbitration clauses that waive the right to bring class claims entirely (in the commercial contract context) may be lawful and enforceable. But unless and until the courts intervene to resolve this tension, requiring your employees to completely waive the right to bring employment-related class or collective actions - a common feature of arbitration agreements - is probably no longer permissible under federal labor law.

If You're Interested In Learning More, Sign Up For Our Webinar

Stoel Rives is hosting a webinar on January 11, 2012, to address employee arbitration agreements generally and the DR Horton decision in particular. Click here if you're interested in learning more or attending.

NLRB's New "Vote Now, Litigate Later" Union Election Rules To Become Effective April 2012

Dan Mueller — Wed, 04 Jan 2012 06:00:14 -0800

The NLRB gave organized labor a meaningful gift just before the holidays by issuing a final rule adopting new election case procedures that will likely result in more and faster union elections, and probably also result in more employers having unionized workforces. The new rule becomes effective on April 30, 2012.

The New Year: Out With The Old Rules...

During union campaigns, the union and the employer may disagree (vigorously) about the proper size ("scope") of the proposed bargaining unit. Such disputes can include whether certain employees are "supervisory" employees and thus ineligible to vote, or whether different classifications of employees share enough of a "community of interest" to be included in the same bargaining unit, and covered by the same contract. How those disputes are resolved often determine the outcome of the election. Under the existing (er, now old) election rules, employers had the opportunity to litigate these types of bargaining unit scope issues before the election.

...In With The New

The NLRB's new rule essentially eliminates the employer's opportunity to litigate, prior to the election, any disputes over the scope of the bargaining unit proposed by the union. Under the rule, such issues will ordinarily be addressed only after the election takes place. Employers should be aware of how this "vote now, litigate later" rule could impact union elections.

Shorter Election Campaigns: Under the old rules, litigating bargaining unit scope issues usually delayed the election, giving employers additional time to discuss the pros and cons of unions with its workers before the vote. That additional campaign period is now lost, depriving employers of valuable time to counter an organizing campaign that may have started months before the union went to the NLRB seeking an election.

Greater Difficulty in Challenging The Union's Proposed Unit: Although employers may technically be able to litigate unit scope and voter eligibility issues after the NLRB conducts the election, in those cases where the vote results in a "yes" vote for the union (which under the old rules happened more than 60% of the time), employers will be in the difficult position of having to contest threshold legal issues after the employees have already "won" the right to representation. This procedure tilts the playing field in favor of unions.

Considered in the context of the NLRB's August 2011 decision in Specialty Healthcare, this rule means that the petitioning union will get a quick election in the unit of employees it has chosen to organize. Specialty Healthcare enables unions to organize small or "micro" units of employees (such as single classifications of employees or individual departments). The Board held that for an employer to add excluded employees to the union's proposed unit, it must demonstrate that the excluded employees share an "overwhelming community of interest" with the employees the union seeks to represent. In a dissenting opinion, NLRB Member Brian Hayes noted that this test makes it “virtually impossible” for the employer to prove the union's proposed unit is not proper. To make matters worse, now the Employer will ordinarily have to make that argument after the union has already "won."

Why Now? Election Year Politics, That's Why.

That the NLRB issued these new rules now probably had less to do with the holiday spirit than with an election of a different sort--the 2012 U.S. Presidential election and the related gridlock in the U.S. Congress. Up until last week, the Board had three members (out of a possible five) which, after the U.S. Supreme Court's 2010 decision in New Process Steel, is the minimum required for the NLRB to decide cases and issue regulations. Last week was when President Obama's controversial recess appointment of Member Craig Becker ended. The NLRB may have wanted to enact the new rules before it was reduced to two members again, as that may be the last opportunity in an election year for the Obama Administration to do something substantial for organized labor, an important constituency. While nominations for the three NLRB Member vacancies are pending, the gridlocked Senate is not expected to act on those nominations any time soon. While the President could make another recess appointment to ensure a functioning, three-member NLRB, that risks (further) alienating Senate Republicans, all 47 of whom recently signed a letter urging the President not to fill NLRB vacancies using recess appointments. The next few weeks, before Congress reconvenes on January 23 from its holiday recess, could be very interesting for NLRB-watchers. Stay tuned...

Update!

...well you didn't have to stay tuned for long! President Obama has announced three recess appointments to the NLRB. The appointees include two Democrats (Richard Griffin and Sharon Block) and one Republican (Terence Flynn), giving Democrats a 3-2 Board majority. The President’s decision to bypass the Senate confirmation process quickly drew the ire of Senate Republicans, but the President chose that fight over the alternative of allowing the NLRB to go through a prolonged period in which it was unable to issue decisions or adopt regulations. As a result of these appointments, we can expect more pro-labor decisions in 2012.

Update - New Rule Requires Employers to Post Notice of Employee NLRA Rights

Jim Shore — Tue, 27 Dec 2011 09:27:03 -0800

In order to allow more time for legal challenges to its notice-posting rule to be resolved, the National Labor Relations Board has again postponed the rule's effective date, this time to April 30, 2012. Stay tuned.

For additional information regarding the NLRB's new rule and posting requirement, including links to the new rule and the poster employers must post, see our prior post on this topic by following this link.

Seasons' Greetings From The California Legislature--New Laws That Apply To Employers In January 2012

Tony DeCristoforo — Thu, 22 Dec 2011 06:00:00 -0800

The California legislature has done plenty this year to leave in employers' stockings for the holidays--new employment laws that will become effective January 1, 2012. In addition to the new California Transparency in Supply Chains Act we blogged about earlier, after some eggnog and holiday cheer, employers will need to be aware of new legal obligations that will kick in as we kick off 2012. Here are the highlights.

“Anti-Wage Theft” Law (AB 469). The Wage Theft Prevention Act of 2011 requires employers to provide non-exempt employees, at the time of hiring, a notice specifying the employee’s rate or rates of pay and the basis on which the employee’s wages are to be calculated (such as hourly, daily, piece, salary, commission, etc.). The notice must also include applicable overtime rates, allowances (if any) claimed as part of the minimum wage, the employer’s designated regular payday, the name of the employer (including any “doing business as” names), the employer’s physical and mailing addresses, and contact information for the employer’s workers’ compensation carrier. The Act also requires the employer to notify employees in writing of any changes made to any of this information within seven days of the implementation of such changes, unless the changes are reflected on a timely wage statement or other writing required by law. The Act adds an element of criminal liability by providing that any employer who willfully fails to pay wage-related Labor Commissioner orders or court judgments is guilty of a misdemeanor.

Independent Contractors (SB 459). This new law cracks down on employers who misclassify their employees as independent contractors by imposing a fine of between $5,000 and $25,000 for “willfully” misclassifying a worker as an independent contractor. “Willful misclassification” means avoiding employee status for an individual by voluntarily and knowingly misclassifying that individual as an independent contractor. The law also imposes joint and several liability for a non-attorney consultant to advise an employer to willfully misclassify someone as an independent contractor.

Background Checks (AB 22). This law prohibits most employers from obtaining or relying on consumer credit reports regarding employees or job applicants, except in certain specified limited circumstances. The law does not apply to financial institutions or entities required by law to perform credit checks. Under the new law, employers may still obtain and rely upon credit reports for managerial employees covered by the executive exemption.

Pregnancy Disability Leave (AB 592 and SB 299). This law expressly prohibits “interference” with the exercise of any right provided under the California Family Rights Act, or due to disability by pregnancy, childbirth or related medical conditions. In a provision that may prove to be preempted by ERISA, the law also requires employers to maintain and pay for health coverage under a group health plan for any eligible female employee who takes up to four months of leave due to pregnancy, childbirth or a related medical condition in a twelve month period.

Gender Identity and Expression (AB 887). Existing law prohibits discrimination and harassment based on gender. This law expands the definition of “gender” to include both gender identity (how the person sees him or herself) and gender expression (how other people view the person). Under the new law, an employee must be permitted to dress consistent with the employee’s gender identity and expression.

Genetic Information Discrimination (SB 559). Discrimination in hiring or employment based on genetic information is now unlawful under the Fair Employment and Housing Act. Genetic information is defined to include the individual employee’s genetic tests, the genetic tests of the employee’s family members, and the manifestation of a disease or disorder in the employee’s family members.

Commission Agreements (AB 1396). This law requires all contracts for employment involving commissions as a method of payment to be in writing and to set forth a method by which the commissions are required to be computed and paid. The employee must be given a signed copy, and the employer must obtain a signed receipt from each employee. This law does not take effect until January 1, 2013, so employers have a year to prepare for compliance.

Agricultural Labor Relations (SB 126). This law authorizes the California Agricultural Labor Relations Board to certify union elections when employer misconduct affects the outcomes.

Happy Holidays!

It's Time to Ensure Compliance with the California Transparency in Supply Chains Act

Tony DeCristoforo — Wed, 30 Nov 2011 06:00:00 -0800

Under the California Transparency in Supply Chains Act, beginning January 1, 2012, large retailers and manufacturers that do business in California must disclose information on their websites about what they do to eradicate slavery and human trafficking from their supply chains. The new law applies to companies with worldwide gross receipts of over $100 million.

The law provides that if a covered company has a website, it must disclose certain information via a “conspicuous and easily understood link” on the homepage. The company must disclose to what extent, if any, it does each of the following:

Engages in verification of product supply chains to evaluate and address risks of human trafficking and slavery, specifying if the verification was not conducted by a third party.
Conducts audits of suppliers to evaluate supplier compliance with company standards for trafficking and slavery in supply chains.
Requires direct suppliers to certify that materials incorporated into the product comply with the laws regarding slavery and human trafficking.
Maintains internal accountability standards and procedures for employees or contractors failing to meet company standards regarding slavery and trafficking.
Provides company employees and management, who have direct responsibility for supply chain management, training on human trafficking and slavery, particularly with respect to mitigating risks within the supply chain of products.

Notably, the law does not require companies to do anything to combat slavery and human trafficking. The law simply requires disclosure of the above information.

Although the law’s exclusive remedy for noncompliance is an action for injunctive relief brought by the Attorney General, the law does not limit remedies available for a violation of any other state or federal law. On an annual basis, the California Franchise Tax Board will submit to the Attorney General a list of companies required to make the disclosure.

Mandatory Paid Sick Leave Law Passed in Seattle

Keelin Curran — Thu, 27 Oct 2011 06:17:44 -0800

Beginning September 1, 2012, the City of Seattle will require that all but the smallest employers provide paid sick leave to their Seattle employees. Sick leave mandates under the new law increase depending on the size of a company’s workforce, and employees must be allowed to use the leave for their own or their family members’ illnesses (“Paid Sick Leave”), as well as for certain safety-related reasons (“Paid Safe Leave”).

Seattle employers should use the coming months to plan how to best structure their paid leave programs to comply with the new law. The law has posting requirements and allows complaints to the Seattle Office for Civil Rights, including recovery of damages where violations are found (but not private lawsuits). Employers have an opportunity to provide comment to the City regarding the law before rules under the law are issued (see below).

Key aspects of the comprehensive new Paid Sick Leave and Paid Safe Leave ordinance include:

Coverage. Employers of five or more full-time equivalent (“FTE”) employees (employees working outside Seattle must be counted) are covered. Employees, including temporary and part-time employees, who work in Seattle at least 240 hours in a calendar year, must be allowed to accrue leave.
Waiting Period. Leave accrues from date of hire, but employees cannot begin to take leave until 180 calendar days after date of hire.
Mandated Leave and Minimum Caps. The amount of required leave increases with the number of FTE employees. Employers in the different tiers are required to allow their employees to accrue leave at the following minimum levels:
- Tier One Employers of 5-49 FTE employees must provide at least one hour of accrued paid leave time for each 40 hours worked, up to a minimum ceiling of 40 hours per year.
- Tier Two Employers of 50-249 FTE employees must provide at least one hour of accrued paid leave time for each 40 hours worked, up to a minimum ceiling of 56 hours per year.
- Tier Three Employers of 250 or more employees must provide at least one hour of accrued paid leave time for each 30 hours worked, up to a minimum ceiling of 72 hours per year.
Basis of Accrual. Non-exempt employees accrue leave time based on hours actually worked. Exempt employees’ leave accrual is based on their regular weekly schedule, up to 40 hours maximum.
Carryover Required; No Payout on Termination. Mandated carryover is required for up to the same amount of leave time employers are required to allow an employee to accrue in any given year. (For instance, for employers of 49 or fewer, up to 40 hours may be carried over.) Payout on termination is not required.
Special PTO Requirement for Largest Employers. Tier Three Employers that use a “universal” paid leave program (usually referred to as “paid time off” or “PTO”), rather than dedicated sick leave, must provide more paid leave under the law than those employers with dedicated sick leave. Tier Three Employers must allow accrual of at least 108 hours of paid leave per year and allow carryover up to the same amount.
Leave Use. Leave can be used for the following purposes:
- Sick Leave. Absence resulting from an employee’s or a qualifying family member’s illness or injury, including diagnosis, treatment and preventative care. (Qualifying family members are the same as under Washington’s Family Care Act: spouse, registered domestic partner, child, parent, parent-in-law or grandparent.)
- Safe Leave. Absence (1) related to domestic violence, stalking or sexual assault of an employee or qualifying family member (amount of leave allowed and qualifying family members are the same as under Washington’s domestic violence leave law), or (2) due to a public health-related closure of the employee’s place of business or a child’s school.
Notice and Certification. An employee must provide at least 10 days’ notice of foreseeable leave, and must generally follow employer notice policies. Certification of leave use is limited to leaves of three or more days. Where the employer does not provide health insurance, the employer must pay at least half of medical costs associated with obtaining the certification.
Considerations and “To-Dos.”
- Opportunity for Comment to the City. Employers have the opportunity to provide comments to and receive updates from the City of Seattle related to the implementation of the law. An FAQ is expected by the end of the year on their website, and draft rules in the spring of 2012. Write to Elliott Bronstein at the Seattle Office for Civil Rights, at elliott.bronstein@seattle.gov, to be included in the notification list, and with any questions or comments you have about the law.
- Collective Bargaining Agreements. The ordinance allows unions to expressly waive their members’ rights under the law. To avoid application of the law, employers should take steps to negotiate with their unions for a “clear and unambiguous” waiver and put it in writing.
- Review Sick and Related Leave Policies, Including Short-Term Disability Policies. Employers must review policies and consider whether changes are needed to meet requirements under the new law.
- Special PTO Requirements. Tier One and Tier Two Employers should make sure their PTO policies meet the requirements of the law to avoid having to provide additional paid sick and safe leave. Tier Three Employers that use a PTO program need to allow accrual and carryover of additional paid leave as described above.

Stoel Rives is here to help employers plan for the implementation of this law on September 1, 2012, and will be providing comments to the City about the law in the near future. Please contact us for assistance.