Happy 4th of July

 

If there's one holiday that everyone seems to relish, it's the Fourth of July.  After all, you've got hot dogs, hamburgers, apple pie, and if the rain finally holds off, fireworks.  

So, happy 4th of July everyone. See you next week.

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The Basics: Weekly Payment of Wages

Given the typically slower summer months, I'm going to highlight some basic Connecticut employment laws that most employers should be familiar with (but that some may not).  Picking up on yesterday's post, it'll be entitled "The Basics" and hopefully will run at least once every week.

Today's topic: Weekly Payment of Wages.

Photo credit: Morguefile

Connecticut law (Conn. Gen. Stat. 31-71b) provides that employers in Connecticut have to pay their employees on a weekly basis. Not every other week. Not twice a month.

For multi-state employers on may have a bi-weekly payroll schedule across the country, this can cause a few headaches (though most payroll companies have long since been able to adapt payroll schedules on a state-by-state basis). 

But of course, there's a big exception to this:  Employers can ask the Department of Labor for a waiver. Conn. Gen. Stat. 31-71i provides that the department  has the discretion to grant or deny such a waiver, so long as the employee is paid at least once a month.  

To request a bi-weekly payment schedule, in fact, the Conn. DOL has set up an online form that the employer can fill out; these requests are typically granted by the CTDOL.  

For employers who request a semi-monthly or even monthly pay schedules, those requests have to be sent directly to the Department of Labor. Those are typically scrutinized in much more detail and there ought to be a pretty good rationale behind that request. 

Record-Keeping for Employers in Connecticut - The Basics

With all the talk this week about Title VII and what I would call slightly more "advanced" issues in employment law, it's always wise to make sure that you, as acourtesy morgue filen employer, have the basics down. 

One issue, for example, that employers sometimes wonder about but rarely figure out is "What Records Must I Keep Related to Wage & Hour Laws?"

Fortunately, the Connecticut Department of Labor website contains a concise summary.  These records, listed below, must be kept at the employer's place of business.  They are: 

  • The employee's name and address;
  • The employee's occupation;
  • The total daily and total weekly hours worked, showing the beginning and ending time of each work period, computed to the nearest unit of 15 minutes;
  • The total hourly, daily or weekly basic wage;
  • The overtime wage as a separate item from the basic wage;
  • Additions to, or deductions from, wages each pay period;
  • Total wages paid each pay period;
  • Working papers/statements of age for each employee under the age of 18.

That's not to say that these are the only records that must be kept. There are a whole host of other regulations (both state and federal) that may apply, including safety records and the like. But for smaller employers in particular, there's no time like the present to make sure you have the basics down correctly. 

For more answers to Frequently Asked Questions, the Connecticut DOL has redesigned their webpage to answer 21 common questions in a short, concise manner. It's worth checking out. 

Five Things Employers Can Learn from the Ricci v. DeStefano Case

Although I tipped my hand yesterday through some posts (here and here) and an interview with the Connecticut Law Tribune, here are some takeaways for employers from the Ricci v. DeStefano case.

  1. The Decision Applies to Private Employers.   Before Ricci was decided, the case could've gone two ways -- it could have been based on constitutional (equal protection) grounds, or on statutory (Title VII -- the law prohibiting race and gender discrimination) grounds. The Court decided to go with the latter.  Why does that make a difference? Because Title VII applies to both private and public employers; if it had been decided on equal protection grounds, it would likely have applied only to public (governmental) employers.
     
  2. Testing Will Never Be The Same.  Whether public or private, employers who use tests to assist them in hiring and promotional decisions get some guidance now in the area. Unfortunately, the guidance that the Supreme Court provides isn't particularly illuminating. Parsing things out, the court suggests that if a test is designed to be race-neutral, the fact that the numbers come out differently than an employer expects is not, in and of itself, enough to throw out the results of the test. There needs to be something more, some "strong evidence in fact". What that is remains to be seen.

    But supposing that an employer does accept the results of the test, can it defend itself from a disparate impact claim? The court says yes.  The court suggests that as long as an employer designs a test that is that is “job related for the position in question and consistent with business necessity” that might get the employer some traction in defending a claim of disparate impact.  Even in that case, however, the Court opens to the door to employees too: The employee can still win a disparate impact claim if the employer refuses to adopt an available alternative practice that has less disparate impact and serves the employer’s legitimate needs.

    As a result, employers who use testing in particular will need to be able to rule out other alternatives that it might have used to make its hiring and promotional decisions. (Note: Title VII does contain specific provisions regarding testing as well so employers should not forget to look to the statutory language as well.) 
     
  3. Affirmative Action Plans and Diversity Plans Are OK For Now. Maybe.  Some larger companies have programs now that try to ensure that the makeup of their workforce properly represents the makeup of the population.  For example, the employer may track "high potential" employees (particularly minorities) within their corporation to ensure that they receive proper consideration for promotions and opportunities.  Are these programs ok?

    The court suggests that it will allow for some affirmative action plans and notes that employer's "voluntary compliance efforts" are essential to the success of Title VII:
    "[We do not] question an employer’s affirmative efforts to ensure that all groups have a fair opportunity to apply for promotions and to participate in the process by which promotions will be made. But once that process has been established and employers have made clear their selection criteria, they may not then invalidate the test results, thus upsetting an employee’s legitimate expectation not to be judged on the basis of race. ... "

    For employers, it suggests that you can review your policies and practices that ensure that minorities have a fair chance to succeed, but reinforces the view that you still cannot make your decisions to hire and promote based on race.  But how much "affirmative efforts" an employer can use, remains an unanswered question from Ricci.
     
  4. Tread Cautiously In Conducting a Disparate Impact Analysis for Layoffs and Terminations.  One area that disparate impact claims arise is in the context of layoffs and reductions in force. For example, an employee may claim that the black workers were twice as likely to be laid off as white workers.   As a result, many employers have started to conduct a disparate impact analysis before the termination to see if the raw statistics are of concern.  If they are, employers sometimes reconsider their decisions or re-engineer the layoff criteria to remove such a disparate impact. In other cases, employers simply review the particularly data to ensure that the decisions were fair.  

    Ricci leaves open the question of whether that practice is legal under Title VII.  The court does suggest that the city "was not entitled to disregard the tests based solely on the racial disparity in the results".  Does this mean that employer -- once it settles on a process for terminations -- cannot change that system after it runs the numbers? At one point is the employer "stuck" with the results? That will likely be the subject of litigation at some point. 
     
  5. Don't Expect This Law to Remain Static.  One thing is certain -- there are likely to be some more changes to this law in the years to come. One way is through Congressional action (as Senator Patrick Leahy has already suggested). Another way is through additional Supreme Court action. Indeed, Justice Scalia has suggested that there are battles yet to come on this issue:

                    [The] resolution of this dispute merely postpones the evil day on which the Court will have to confront the question: Whether, or to what extent, are the disparate-impact provisions of Title VII of the Civil Rights Act of 1964 consistent with the Constitution’s guarantee of equal protection? The question is not an easy one.

As a reminder, I'll be participating in a free webinar next week on this subject. I anticipate that it'll focus on the practical implications of the decisions and additional steps that employers can take now to avoid becoming the next test case before the Court. 

Ricci v. DeStefano - The Best of Today's Coverage of the Supreme Court Decision

For a case out of little Connecticut, the Ricci v. DeStefano case today sure has drawn big interest. Seems like everyone has an opinion on the matter.

There are plenty of wrapups of the case out today. Many of them are, predictably, saying much of the same thing: Interesting case; probably applies to private employers; still waiting to see the impact.

For the mainstream local media approach, the Connecticut Law Tribune has two pieces here and here (I'm quoted in the latter).  The Hartford Courant's piece is here. For a slightly less-mainstream approach, the New Haven Independent's report has some good local feedback here and here.  And Slate magazine has some great "breakfast table" discussion pieces about the case in easy-to-understand language as well. 

But there are a few analytical pieces I've reviewed today that stand out and I thought I would highlight a few that break through the clutter.

I've been reviewing the decision today as well and will have some additional thoughts (with action steps for employers) in an upcoming post.

Monday's crucial ruling is on the question: how serious does the prospect of litigation over an employment practice have to be before an employer is allowed to lean over in the opposite (discriminatory) direction to avoid liability? Justice Kennedy's majority rejected New Haven's contention that a "good faith" fear of liability should be enough, but also rejected the firefighters' contention that reverse discrimination could be justified only to avoid an outright collision between the two legal requirements. Instead, Justice Kennedy selected a middle ground: to discriminate against majority applicants, employers will need a "strong basis in evidence" that they otherwise "would have been liable."

Even now, The New York Times is no doubt preparing an editorial grimly portending the return of white supremacy at the hands of a callous Court. But the moral is probably a narrower one: If you're going to shaft white applicants, don't be as blatant about it as New Haven was. Kennedy was clearly angered by the after-the-fact disavowals and excuses by the city that, in his words, were "blatantly contradicted by the record." The Court is traditionally unsympathetic to employers that invent "pretextual" reasons for biased decision making; this time that principle happened to cut in an unexpected direction.

 
  • The World of Work blog has its take on the decision and predicts something else -- a bill from Congress. In addition, the blog suggests that employers need not worry about the case (something that I disagree on, to a degree, as I'll discuss in an upcoming post):

Ultimately, the Ricci decision will have little to no impact on most employers, but represents a small victory for employers (despite the positioning here that held against the city/employer). Employers can now take a somewhat more confident stand in backing test results that may demonstrate some disparate impact, so long as the test was objective and no other less discriminatory alternative exists. The Ricci decision may not last for long, however. Political condemnation by Democrats has been swift, with Senator Patrick Leahy (D-VT) saying that "it is less likely now that employers will conscientiously try to fulfill their obligations under this time-honored civil rights law. This is a cramped decision that threatens to erode these protections and to harm the efforts of state and local governments that want to build the most qualified workforces." Don't be surprised if Congress passes legislation down the road aimed at upending the Ricci decision.

The result is also going to make it difficult for employers to navigate Title VII, although maybe not more than it was before this decision. Employers will likely do nothing to evaluate their hiring or promotional processes until those processes have run their courses. There is very little incentive for employers to try avoid disparate impact liability any more than they would have before this decision, and more incentive not to change anything, just in case that change is itself discrimination.

I'm not necessarily sure I agree with this because it presumes that employers don't care about their employees or care about ensuring that their workplace is free from discrimination. Many employers already have systems in place to review their hiring and promotional practices; it's difficult to see why employers would simply dismantle these programs in light of Ricci.

The new standards the Court has imported into the Title VII legal equation are not really specific or well-defined, so it very likely will take future lawsuits to sort out just what the new requirements mean. In practical terms, it is very likely that employers will have to go to greater lengths to assure that testing protocols are race neutral, and will have to have sounder legal advice about the risks they take under Title VII if they apply test results that have a negative impact on minority workers.


What Employers Need to Know About Ricci v. DeStefano - A Free Webinar

A further read-through of the Ricci v. DeStefano case today has reinforced my view that there are going to be some real lessons learned for employers out of this case.  The case had the potential of being a very narrow decision which would have minimized the impact to employers. However, because the court addresses head-on various Title VII issues, it's likely to creep into much larger issues and it's not out of the question to see it impact affirmative action plans or diversity programs.

Because of that, I've decided to spend a good deal of time discussing this case and the impact on employers in Connecticut and beyond in a webinar scheduled for July 8th at noon EDT.  You can register for it for free here.  Space will be limited so be sure to sign up today. 

In this session, I anticipate we'll discuss::

-- The basics of Title VII and how it applies to employers
-- The differences between "disparate impact" and "disparate treatment" claims
-- How employers should deal with the use of tests in the workplace and what it is permissible to do when the test results seem "off"

-- What the lessons are to be learned from Ricci, and steps employers can take to avoid reverse discrimination claims in the future

-- What is "reverse" discrimination and whether employers need to be concerned about such claims

-- What the impact this decision will have on affirmative action plans and diversity programs

As time permits, we will also wrap up the other Supreme Court employment law decisions in the 2008-09 term and the takeaway for employers in each of those cases, including an important age discrimination case.

Looking forward to having you all join us. 

BREAKING: Ricci v. DeStefano - Supreme Court Reverses Second Circuit And Finds New Haven Violated Title VII in 5-4 Decision

In closing out its 2008-09 term today  the U.S. Supreme Court ruled 5-4, along ideological lines that the city of New Haven violated Title VII in refusing to promote a group of white firefighters and refusing to apply the results of a test that it claimed would have had a disparate impact on minorities.

The decision in Ricci v. DeStefano (download here) is bound to be heavily reviewed, scrutinized and analyzed.  Indeed, because Judge Sotomayor (who was involved in the original decision at the Second Circuit) has now been nominated for the Supreme Court, the decision has been highly anticipated.

But despite the hyperbole about this case beforehand, the case has pitted two competing issues against each other - the city's alleged fear that the test, if applied, would have had a disparate impact on minorities (opening itself up to a lawsuit) and the firefighter's right to be promoted based on doing well on the test.  The Court said that the city's fear was not sufficient to not use the test and that not using the test was a violation of Title VII.  

Indeed, in its decision, the Supreme Court goes one big step further; it provides the city with a defense to a possible disparate impact lawsuit:

Our holding today clarifies how Title VII applies to resolve competing expectations under the disparate-treatment and disparate-impact provisions. If, after it certifies the test results, the City faces a disparate-impact suit, then in light of our holding today it should be clear that the City would avoid disparate-impact liability based on the strong basis in evidence that, had it not certified the results, it would have been subject to disparate-treatment liability.

I've previously discussed the case extensively in a variety of posts which can be found here and here.

Justice Ginsburg provides the dissent here and predicts that the case will be difficult to apply in practice and further suggests that employers may have a difficult time fiting within its parameters:

As a result of today’s decision, an employer who discards a dubious selection process can anticipate costly disparate-treatment litigation in which its chances for success—evenfor surviving a summary-judgment motion—are highly problematic. Concern about exposure to disparate-impact liability, however well grounded, is insufficient to insulatean employer from attack. Instead, the employer must make a “strong” showing that (1) its selection method was“not job related and consistent with business necessity,” or (2) that it refused to adopt “an equally valid, less-discriminatory alternative.”

I'll refrain from any big snap judgments until I review the decision at length (93 pages and all) but suffice to say that this decision will be the new starting point for employers who worry about disparate impact claims.  It's application to private employers will no doubt be scrutinized as well, but I'm going to review the whole decision before drawing too many conclusions.

What's interesting is that the court decided the case on Title VII grounds instead of the "Equal Protection Clause" questions that it also faced. What this means is that private employers need to pay much closer attention to this case than had it been decided on the other grounds. After all, Title VII applies just as much to private employers as it does to the government.  

My firm will be presenting a free webinar on this case and its impact on employers on July 8th at noon. Details will be forthcoming in a post later today. 

In the meantime, if you're looking for other instant analysis, check out the SCOTUSBlog for their posts.

The Dark Side: Putting a Stop to Workplace Rumors, Gossip and Innuendo

The news late Thursday afternoon came without warning from friends, a co-worker, and of course, Twitter.  There was another death of a popular star.  Suddenly. Tragically. 

Jeff Goldblum was dead.Courtesy Wikipedia Commons - Hal Hartley Photos

Except he wasn't.

And yet, in the span of a day -- when the world lost Farrah Fawcett and Michael Jackson -- a rumor was spreading that actor Jeff Goldblum was the third star to pass away.  After all, bad things happen in threes.  But it turns out it was completely false.  

The news brought to mind situations where an employer is faced with the similar "dark side". Rumors. Innuendo. Gossip.  

Word spreads fast in a workplace. Even faster now with e-mail.  And for employees, rumors can be toxic, as an old New York Times article explains.  

So, what's an employer to do? 

Well, the specifics first depend on the facts. Is the rumor that an employee is on drugs? Having an affair? Has mental issues? Or, my favorite, doesn't take showers?  

Or is it more general about the company. Is it a rumor that the company is about to layoff employees? Or that the company is in financial difficulties? Or that the chief executive officer is having a liver transplant?

And what's exactly happening? Is e-mail usage about it going up?Is there lots of talk behind closed doors?

Each of these situations (and the many others that get spread) has different levels of response.  

For example, perceiving that an employee is disabled may bring claims under the ADA so an employer can discuss with a supervisor ways to comply with the law.

On the other hand, a reminder that harassing, humiliating or abusive comments about another employee via e-mail might be enough to stop rumors about the sudden disappearance of gray from an employee's head.  

How else can a company react?  Some practical suggestions include:

  • Reinforce that the company computers are to be used for company-related business and that inappropriate e-mails such as sexual innuendo will not be tolerated.
  • If it persists, consider whether you want to engage in  "electronic monitoring" of your computer system upon proper notice to your workforce
  • Maintain consistent intra-corporate communications.  In the absence of facts, rumors can spread fast.
  • Every office seems to have an outlaw or two. Talk with them and make sure they understand that spreading gossip will not be tolerated.
  • Address rumors immediately.  The speed of the Jeff Goldblum rumor on Thursday reinforces that fact to me.  

And if you hear the rumor today that Jeff Goldblum is dead, you can put a stop to that too.  

Still Awaiting A Decision on Ricci v. DeStefano

Those waiting for a decision in the hotly-anticipated Ricci v. DeStefano case will have to wait a few more days (likely Monday). The U.S. Supreme Court released the decisions for the day this morning and Ricci was not among them. It is now expected to be released early next week. It is one of just three cases remaining on the court's docket.

In the meantime, Slate has published a lengthy piece today about the story "behind" the case.  It appears to be well-sourced and detailed and provides the type of insight you would expect from Slate. As the article states: 

The story behind Ricci is just one example of an entrenched conflict over municipal hiring that extends back in time and across the country. For at least two generations, competition for jobs in many cities has been framed as a battle between one ethnic or racial group and another over who is an insider and who is an outsider. Black firefighters first brought a suit over discrimination in New Haven in 1973. They won. So did minority firefighters who sued Cleveland, Birmingham, St. Louis, New York City, Newark, Bridgeport, Buffalo, Philadelphia, Massachusetts (statewide), San Francisco, Baltimore, and Minneapolis, according to the NAACP Legal Defense Fund. 

But those victories all came in the 1970s. More recently, white firefighters have begun to fight back in court. Frank Ricci's case isn't the first reverse discrimination suit in a fire department. In 2001, four white men sued the Boston Fire Department for hiring minority candidates who had scored lower than the plaintiffs on a civil-service exam. They were the first to challenge the Boston department's affirmative-action policy since it had been upheld by the U.S. Supreme Court in 1989. In 2004, they won. Last year, a Los Angeles jury awarded two white fire captains $1.6 million in damages in a suit claiming that they had been punished more severely than a minority officer for participating in the same prank. The New Haven suit, meanwhile, has spurred a similar one by white firefighters, also over promotional exams and test scores, in nearby Bridgeport, Conn.

 

Federal Court Denies Summary Judgment to Background Check Company Based on Alleged Violations of FCRA

In a case that should send shivers through background check companies, particularly in Connecticut, a federal district court judge recently ruled that a job applicant could proceed to trial with her claims that two background check companies violated in the Fair Credit Reporting Act when they reported that she had been convicted of a crime (when she allegedly had not). 

The case, Adams v. National Engineering Service Corp. (download here) has a detailed and, at times, compelling recitation of a background check that appears to have gone awry but also of a background check company that appears to have done quite a bit to try to alleviate the situation.

Nevertheless, the Court found that what the background check company did to try to comply with the applicable law may not have been enough. (The court has sent the matter on to a jury for a determination.) Other portions of the opinion address the issue of when the background check company needs to report the negative information to the job applicant directly.

Another portion of the case answers the sticky question of whether a background check company needs to provide notice of such negative information to the applicant directly.  Relying on 15 U.S.C. 1681a(k), the court answers the question "yes", finding that the company's reporting of such information to a potential employer is an "adverse action" that requires such notice. 

I've previously discussed background checks before. For companies that engage in background checks (and the employers that use them), compliance with FCRA isn't easy.  Add a hodgepodge of various state laws and it is a compliance issue waiting to happen.

Nevertheless, reviewing and auditing your current policies and procedures may be the best step that employers can take from this case.  As this case illustrates, no detail about the FCRA will be too small.