monkeyIn yesterday’s post, I talked about some of the reasons why an employee’s lawsuit against his or her employer was destined for failure.

But employers, I’m afraid you’re not off the hook that easily. This post is for any employer that just got sued or threatened with suit.

Maybe that lawsuit isn’t so frivolous after all.

Wait a second! You said yesterday that ‘Odds are, you probably weren’t discriminated against’!”  

Ah, but isn’t that rub? Odds. Statistics.  Yes, some (many?) lawsuits brought by employees are losing propositions. But some are not.

Here are some things I tell clients or prospective clients when I see a lawsuit filed or threatened as to why they should take the lawsuit seriously.

1. That frivolous lawsuit is still going to cost you thousands (if not tens of thousands) to defend.  But I thought you said this post was about non-frivolous lawsuits?  True. But for my first point, that’s beside the point entirely.  Whether a lawsuit is frivolous or not, the system of justice through our courts and administrative agencies moves slowly and with some cautiousness.  Even the frivolous ones need to be defended.  Court filings need to be, well, filed.  And court conferences need to be attended.  So your first point always is to recognize that all employment law cases have a cost associated with them.

And as such, all cases have what we call a “nuisance” value as well.  That is — you are going to spend X amount of dollars defending the lawsuit.  It may be cheaper to just pay a certain amount to avoid the cost of defense.  Now, there are business reasons why you won’t want to do so in all or even many cases, but the employer who fails to recognize the nuisance value of the case is destined to be disappointed in the long run.

It’s a bit of hyperbole to say that any person can sue anyone at any time for any reason. But not that much.  Lawsuits are a part of doing business.  Frivolous or not, you will still have spend money to defend your decision. Be prepared for this eventuality when making your employment decisions and deciding whether or not to offer severance in exchange for a release.

2. “At Will” Employment Is a Misnomer.   In Connecticut, the default employment relationship between an employer and employee is “at-will”.  As many offer letters suggest, that means either the employer or employee can terminate the employment relationship at any time for any reason or no reason at all.  And so, I sometimes hear employers exclaiming “Connecticut is at-will! We should be able to just fire them for any reason!  How can they still sue?

Continue Reading Maybe That Lawsuit Brought By Your Employee Isn’t So Frivolous

Rainbow over Hartford
Are Things Getting Better or Worse?

The last few weeks it seems that I’ve been reading about sexual harassment in the workplace issues a lot more. Here are a few examples:

So what’s going on? Is sex harassment increasing? Or is this just another round of increased focused placed on a problem that still persists?

Well, if you look at the statistics, you can see part of the story — and part of the problem trying to glean trends from the numbers too.

Last year, I reported on some statistics from the state level about harassment claims.  Indeed, sex harassment cases were down significantly, but general “I’ve been harassed” claims were up nearly 200% over the last decade or so.

The EEOC statistics show slightly different numbers. Sex harassment claims went up by a modest 4 percent in fiscal year 2015, though more generalized “harassment” under Title VII claims also increased by 6 percent.

So, which is it? Up or down? Statistics on case filing don’t tell the full story.  Surveys (yes, including the one in Cosmopolitan magazine) show that women still think some workplaces have issues.

But I would argue that chasing statistics is missing the point. Rather, it’s the perception of whether this is a hot issue that will drive the discussion.  And to that, we’re definitely seeing renewed interest. For example, a few weeks ago, the EEOC issued some findings and statements from a select task force calling on stakeholders “to double down and ‘reboot’ workplace harassment prevention efforts“.  This increased focus on the area will once again bring the issues of sexual harassment to the forefront.

What’s an employer to do? Well, start with the obvious.  Review your existing policies. Are they strong enough? Do they need to be updated to reflect current practices?  And then review your existing training.  Is it updated? Or is it still stuck in the 1990s?   And then look at how your workplace is actually functioning.

Beyond that the EEOC has a whole list of suggestions for employers to follow. You can view the entire compilation, but here are a few examples:

  • Employers should foster an organizational culture in which harassment is not tolerated, and in which respect and civility are promoted. Employers should communicate and model a consistent commitment to that goal.
  • Employers should assess their workplaces for the risk factors associated with harassment and explore ideas for minimizing those risks.
  • Employers should conduct climate surveys to assess the extent to which harassment is a problem in their organization.
  • Employers should devote sufficient resources to harassment prevention efforts, both to ensure that such efforts are effective, and to reinforce the credibility of leadership’s commitment to creating a workplace free of harassment.
  • Employers should ensure that where harassment is found to have occurred, discipline is prompt and proportionate to the severity of the infraction. In addition, employers should ensure that where harassment is found to have occurred, discipline is consistent, and does not give (or create the appearance of) undue favor to any particular employee.
  • Employers should hold mid-level managers and front-line supervisors accountable for preventing and/or responding to workplace harassment, including through the use of metrics and performance reviews.
  • If employers have a diversity and inclusion strategy and budget, harassment prevention should be an integral part of that strategy.

HR personnel have a lot on their plate now; be sure harassment prevention remains there as well.

Well, it was bound to happen.  After nine years of writing the blog on a near daily schedule, some work and personal commitments interfered with my blog writing schedule. But never fear, more new posts from me are now right around the corner.

In the meantime, one of our summer associates, James Joyce, joins the blog today to give an update on a a law passed last year regarding pay secrecy. My thanks to James for his work on this.  James is finishing up his law degree at University of Connecticut.  

joyceLoyal readers may recall that about a year ago, Connecticut’s “Act Concerning Pay Equity and Fairness” Public Act 15-196, became law.   Dan has already blogged about the nuts and bolts of the “Pay Secrecy Bill” and its potential impact on employers.

And, as Dan highlighted, employers need to be mindful of this legislation because it created a private cause of action in court for any violation.  That is where today’s post comes into the picture.

One of the first lawsuits alleging violations of the “Pay Secrecy Bill” was recently filed in Superior Court in Stamford (the case has since been removed to Federal District Court).   The lawsuit raises other issues as well, but for today’s post, we’ll focus on the “Pay Secrecy” claim.

So what’s in this lawsuit? Well, the plaintiff alleges that her former employer maintained a “Pay Secrecy Policy” forbidding employees from discussing their salaries despite the enactment of the “Pay Secrecy Bill” in July 2015.

Specifically, the allegations include a run-in with the human resources (HR) department due to comments the Plaintiff made about salaries and her former employer’s view that this was inappropriate and none of the plaintiff’s business.  The plaintiff received an “Employee Warning Notice” from HR and HR went on to tell the plaintiff she could not discuss her wages or her co-workers’ wages.

Additionally, in February 2016, it is alleged that a former co-worker of the plaintiff was reprimanded for a conversation she had with another employee about the company’s paid time off/holiday policy.  The former co-worker was allegedly told directly by the CEO and by HR that this conversation or any similar conversations violated the company’s policy prohibiting employees from discussing compensation with other employees

Obviously, whether or not these facts are true — or rise to a level of violating the law — will play out in court.  But these types of incidents are just the sort of things that employers need to be aware of to avoid “Pay Secrecy” violations.  The law prohibits employers from implementing policies that prevent employees from, or disciplining employees for, engaging in conversations about salary-related information.

Because this case was recently filed there is no way to predict how the court will rule.  Nevertheless, that does not mean this case should be ignored until it is decided.  Employers should remind their human resources staff and managers of this new Connecticut law.

The downside will be cases like this where the employer may have to spend time and money investigating and defending themselves against the alleged “Pay Secrecy” violations.  Employers also risk being found liable for compensatory damages, attorney’s fees and costs, punitive damages, and any legal and equitable relief the court deems just and proper related to the alleged violations.

vacationLast week was the first time in the seven year history of this blog that no blog posts were uploaded. Why?

Vacation.

It’s been a long cold winter and my wife and I were able to corral our kids for some much needed warm-weather rest and relaxation — after a very challenging year.

As it turns out, way too many American didn’t take any vacation days last year — whether by choice or necessity.

Vacation days have a way of making their way into litigation too. There was this story of an employee who was fired for accruing too much vacation days.

And stories of those employees who went on vacation after their boss told them to cancel their plans.  And were fired.

A few companies are now moving to an “unlimited” vacation policy where employees can take as much as they need. But only 3 percent of companies have adopted such a practice.

And it works best for those in upper management who have a tough time taking vacation.

Which leads me to this point: Vacation actually improves productivity.  Indeed, a study by Oxford Economics in 2014, found the following:

Our research finds that employers and employees perceive significant benefits to taking PTO. For the employer, benefits include more productive, focused and dedicated employees. For employees, time away from work reduces stress with notable benefits to relationships and health. Most employees report coming back to work feeling renewed and refreshed, and ready to focus on work.

However, despite most workers earning paid time off—and an apparently supportive corporate environment—many US workers do not use all of this entitled time. More than 4 of 10 employees finished 2013 with unused PTO.

So, after this long winter, encourage your employees to take their vacation time. It’ll help both y our employees AND your company in the long run.

Just a quick followup today on a post from last month.

As I reported then, a District Court judge dismissed a closely-watched EEOC lawsuit against CVS challenging a pretty standard severance agreement.  But the grounds for the dismissal were unknown back then.

The wait is over; the written decision was released yesterday.  For those that were hoping that the court might shut this issue down, you will be disappointed because the court decided the case largely on procedural grounds.  The Court found that the EEOC had not exhausted its conciliatory efforts required by law.

Yawn.

And so, we’re back to where we were at the start of the year.  The EEOC is likely to continue to push this issue.

Still, I remain unconvinced by the merits of the EEOC’s arguments.  Courts have, for example, routinely upheld enforcement of severance agreements — albeit in different contexts.  But the arguments raised by the EEOC appear to be a stretch to me.

So, for now, employers should continue to stay alert on this issue but until we hear otherwise, it also seems that many will find it best to continue to use these agreements without further modification.

My good friend, Jon Hyman of the Ohio Employer’s Law Blog, probably said it best this morning:

I try to shy away from hyperbole, but OH MY GOD, THIS CASE COULD BE RUINOUS!!!

Yeah, pretty much.

Is the sky falling?

So, if you — like me — have been tied up with day-to-day affairs for a bit, or thinking how tomorrow’s snowstorm is going to put you over the edge, you might have missed the news of a lawsuit brought by EEOC against CVS.In it, the EEOC has challenged a bunch of garden-variety provisions that are being used in nearly every separation agreement in this country, I suspect.  Just look at some severance agreements that are publicly available and you’ll see some of the biggest companies using these same agreements with their executives.

Jon does a nice job recapping the provisions that are at issue (such as confidentiality and nondisparagement) so I’m not going to repeat them here, but if the EEOC prevails, it would turn this area of law on its head.

And that’s the key fact: IF the EEOC prevails.  My gut tells me that the courts are not likely to view the government’s arguments with favor.  The arguments just seem too “out there.” But that’s why we have the legal system — to test arguments like these.

But for employers, that is of little solace.

There are, however, some potential stopgap measures. In some agreements now, there is a carveout that says, in effect, nothing in this agreement prohibits employees from engaging in conduct with the EEOC and such conduct won’t constitute a breach of the agreement.  Jon suggests some language.

There are two other potential ideas that can be considered as well:

  1. First, employers could consider a “severability” clause that says that to the extent that any provision is found to be overbroad or illegal, it shall not affect the enforceability of the rest of the agreement.
  2. Second, employers could borrow the idea of a “blue pencil” from the area of restrictive covenants and empower the court to “revise” any provision that is overbroad to make it fit within the contours of the law.

None of these solutions is perfect and again, it is far from clear whether this lawsuit will find any favor in the courts anyways.

For now, employers will be left to wonder if the agreements that they have relied on to end lawsuits may ultimately survive an even bigger lawsuit.

Over the years, we’ve had a little fun on this blog, with friendly bets with other employment law attorneys, over everything from a sports event to, well, a sports event.  The loser traditionally has to extol the virtues of the winning team on an employment law blog with some loose employment law tie-in.

Last week, Philip Miles — who writes the long-running Lawffice Space Blog –– issued a challenge to me to see who would win the UConn – Penn State women’s basketball game over the weekend.  Since his post is appearing here, you can guess the results. I’ll let Philip finish the story, though his employment law angle is a bit lacking:

One of the greatest sport clichés of all time is that “to be the best, you’ve got to beat the best.”

My beloved Penn State Lady Lions basketball team has taken that statement to heart and challenged the UConn Huskies each of the past three years. Unfortunately, the Lady Lions dropped all three contests. In fact, none of them were even particularly close. I placed a friendly wager on the latest game with the proprietor of this blog. I now pay my debt: a tribute to UConn.

Make no mistake about it, UConn is the best. Are they ranked number one? Check (by unanimous vote). Are they the defending national champions? Check (including a blowout win over fellow 1-seed Notre Dame). Are they historically one of the greatest? Check (seven championships from 2000-present). Do they have a legendary coach? Check (Geno Auriemma is 841-133 as a head coach – although I think Pat Summitt contends for greatest ever).

I don’t have much more to say. To be the best, you’ve got to beat the best. For now, the basketball world is a game of “King of the Hill” (perhaps “Queen of the Hill” would be more appropriate here) and everyone else is just scrambling for a shot at UConn . . . just to get knocked back down again. Baylor and Notre Dame had all kinds of hype last year, but they couldn’t get it done.

Rest assured, there are challengers out there right now preparing to take down the reigning champs, and they’re hungry. Does UConn have what it takes to stay on top again this year? Recent history suggests they do, but March Madness is a long way off.

Of course, to get the employment angle, Philip could’ve updated us all on the discrimination lawsuit that had been brought against UConn coach Auriemma — it was dismissed earlier this year.  But let’s face it, watching basketball is a lot more fun than keeping track of lawsuits.  

My thanks to Philip for the quick guest post. Even shorthanded, though, the UConn Huskies are still “simply the best”.  

The Hartford Courant and Fox CT last week released their list of “Top Workplaces” in the Greater Hartford area.

In a column accompanying it, columnist Dan Haar suggests the ingredients that go into a good place to work: Passion, Freedom & Direction. He states:

One common thread is a system that shows respect for employees and customers alike, with a clear sense of direction, whether that means doing a better job managing behavioral health caseloads for the state (ValueOptions, Connecticut) or growing stock value a breathtaking 18-fold in less than five years, as Virtus Investment Partners has done.

But it’s more than just systems and strategies. Employees are not just dedicated to the business, to the team, but to the particular craft that they perform, with passion. The whale trainers love training whales, assisted-living program coordinators love working with elderly clients and the healers love healing.

It is about identity and it is not interchangeable. In short, it’s not just a job.

Now, I’m under no illusions that awards like these are mainly vehicles to boost advertising revenue.  The contests are far from scientific.  (Indeed, I’d argue that these surveys make the U.S. News college rankings look like Nobel Prize-winning scientific studies.)  Heck, Connecticut Magazine has its own list of “Great Places to Work”.

But there is clearly something to be said about how some workplaces are able to build a culture that employees find rewarding.

A Harvard Business Review article from earlier this year — which compiled research over a three year period — suggests that there are six attributes to a successful company:

We call this “the organization of your dreams.” In a nutshell, it’s a company where individual differences are nurtured; information is not suppressed or spun; the company adds value to employees, rather than merely extracting it from them; the organization stands for something meaningful; the work itself is intrinsically rewarding; and there are no stupid rules.

I haven’t seen any study that suggests that companies that get on such list are less likely to get sued by former employees. But that doesn’t mean that employers should simply give up; rather, having a place where your employees are happy to work at, surely is a way to reduce exposure to potential employment law claims.

Over the last week, two unrelated stories caught my eye.  For employers, they are a reminder that claims of pay inequality based on gender are still something to be concerned about. 

Photo Courtesy Library of Congress c. 1943

The first story is that Governor Malloy announced plans for a new study to examine “factors that contribute to the gender wage gap in Connecticut’s workforce.” 

The study will be run by  new Connecticut Department of Labor Commissioner Sharon Palmer and Department of Economic Development Commissioner Catherine Smith.  The Governor has asked the commissioners to make recommendations on the issue by October 2013.   

I’ve talked about this issue before; there are some who believe that the wage gap is overstated.  But the study will make headlines this year and this renewed focus in Connecticut on the issue should have employers revisiting their own practices.

The second story illustrates the claim in much more real world terms and shows the perils of trying to navigate your way through such claims. 

In Morse v. Pratt & Whitney, decided last week, a federal court — among other issues — denied an employer’s motion for summary judgment on an Title VII unequal pay claim.

Continue Reading Gender Inequality Claims Make Headlines in Case and in New Study

A new lawsuit filed last Thursday in Connecticut state court by an employer alleges that the employer’s due process rights are being violated by “inherently conflicted and irreparably unfair proceedings” at the Commission on Human Rights and Opportunities (CHRO) — the state agency responsible for investigating and enforcing the state’s anti-discrimination laws. 

In the lawsuit, NERAC v. Krich, a copy of which can be downloaded here, the employer alleges (among other things) that that the administrative law judge (a human rights referee) is a client of the presenting attorney (Commission Counsel) in a federal court lawsuit that has similiar issues to the ones that the employer is facing. 

Because of that attorney-client relationship and other due process violations, the employer alleges that the five cases it has before the ALJ must be dismissed.

There are lots of details to this lawsuit that can’t be neatly summarized in one short blog post, but several allegations jump out upon a quick review:

  • First, for those employers, that think the CHRO hearing process is quick and cheap, the lawsuit shows that the employer in this case has been dealing with allegations for over five years and many weeks’ worth of hearings in five consolidated cases.
  • Moreover, the employer sought to recuse the human rights referee (Michele Mount) on the grounds that she had applied for an associate position at the employer’s lawfirm (Jackson Lewis LLP) and was denied a position from the employer’s specific counsel (Victoria Woodin Chavey) in January 2012.   Ms. Mount denied the recusal motion, the lawsuit alleges, on the ground that “‘administrative adjudicators”‘are not required to meet the same standards of impartiality as judges.”  
  • On the date that the motion for recusal was denied, the lawsuit also alleges that Ms. Mount “had reviewed the LinkedIn profile of a senior officer of [the employer] whose alleged remarks had been the subject of a motion in limine” that had been denied.  When the employer sought to preclude reliance on information outside the evidence admitted at the hearing, the referee also denied that motion as well.
  • The lawsuit alleges that the CHRO is also pursuing an agenda of allowing attorney’s fees or emotional distress damages despite “no statutory authority to award such damages pursuant to Conn. Gen. Stat. Sec. 46a-58(a).”  It cites to the City of Shelton lawsuit that I covered back in August 2012.

The employer sought an ex-parte injunction, which was denied, but the court did schedule a hearing on the motion shortly.  The CHRO — through the attorney general’s office — has not yet filed a response and just filed an appearance in the matter on Friday.

For employers, the lawsuit should be carefully watched.  Some employers have been suspicious of whether they are able to get a “fair shake” at the CHRO and this lawsuit will certainly bolster those suspicions.  Whether a court will ultimately intervene, however, is an entirely different question that is simply impossible to answer at this early stage. 

Regardless, if employers have any hearings at the CHRO where the agency is seeking emotional distress damages on behalf of a complainant, they should continue to monitor this case and the Shelton case previously mentioned.

(Disclosure: I previously worked with the employer’s counsel, Ms. Chavey, at our former firm, Day, Berry & Howard up to 2005 or so.  I have no involvement, however, in the above proceeding.)

NERAC v. CHRO