There is news in the employment law world beyond sexual harassment.  Arbitration clauses to be exact.

Yesterday, the Second Circuit issued a small, but important decision for employers that will continue to limit FLSA wage & hour claims.

The court ruled that an employee’s FLSA claims in court were barred by the arbitration clause contained in his employment agreement.  While it isn’t the first time, it’s clear logic will be tough to ignore.

(The case, Rodriguez-Depena v. Parts Authority, Inc. et al can be downloaded here.)

For the court, it was not even a close call. The court ruled that the Supreme Court’s pronouncement years ago that age discrimination claims were barred by an arbitration clause controlled.

The court also looked at whether its decision in the Cheeks v. Freeport Pancake House, Inc. – which required oversight of settlements of FLSA claims — precluded arbitration. The court said it did not.

The rationale of Cheeks, however, is assurance of the fairness of a settlement of a claim filed in court, not a guarantee of a judicial forum.

For employers in Connecticut it remains to be seen if the Connecticut Supreme Court will be all in on such a logic for state wage & hour law claims, but the federal endorsement of arbitration provisions provide a strong basis for doing so.

The case is yet another sign that employers have a few options when it comes to FLSA claims.  It has previously held that class action waivers for FLSA claims are also valid.  

Nevertheless, employers should once again consider whether mandatory arbitration provisions are right for their workforce, particularly when combined with class action waivers.  Having such provisions in place could make a big difference in the future.

starrMy colleague Gary Starr returns today with a decision from the Second Circuit (which covers Connecticut) that may just surprise you. Then again, if you’ve been following this line of reasoning, perhaps not.

There are outer limits to insulting speech, but a recent decision seems to indicate that it is really really far out there.

The questions up for consideration: When can an employer fire an employee for profanity during a union organizing drive?  When does the employee who stoops to insult not only his supervisor, but his mother, lost the protection of the National Labor Relations Act?

The Second Circuit faced these questions and provided a glimmer of hope for employers.

During the course of a nasty union organizing drive at a catering company, an employee became very upset at what he considered the employer’s continued disrespect for the employees.

In response, Perez used his iPhone during a work break to post the following:  “Bob [his supervisor] is such a NASTY MOTHER F****R don’t know how to talk to people!!!! F*** his mother and his entire f***ing family!!!! What a LOSER!!!! Vote YES for the UNION!!!!”

Perez had about ten other employees as friends on Facebook, but the post was also available to the public. Management learned of the post, investigated, and then fired Perez, just days before the election.

An administrative law judge found that the firing violated the law as Perez was engaged in protected, concerted activities.  This decision was upheld by the NLRB.  The case was then appealed to the Second Circuit.

At the court, the question was whether the post exceeded the bounds of protection by using profanity and insulting the supervisor’s mother.

While the Court in NLRB v. Pier Sixty was disturbed by the language and by the Labor Board’s failure to adequately take into account the employer’s interests in assessing how to evaluate a social media posts, it nonetheless, found a violation of labor law by the employer.

The Court noted that the employer had not disciplined many others for profanity in the past, even though profanity was a common occurrence in the kitchen,  that the language was not used at a catered event or in front of customers, that the message focused on matters that are protected, concerns about respect, that the message concluded by urging readers to vote for the union, and that the discharge occurred two days before the voting.

While the Second Circuit upheld the Labor Board’s decision, it sent a message that these facts are on the “outer-bounds of protected, union-related comments.”   It cautioned the Labor Board that it needed to be sensitive to employers’ legitimate disciplinary interests and to properly balance the competing interests of employees, unions and employers.

The facts in this case presented the court with hurdles it could not get over.  Profanity was common in the workplace, employees had not been disciplined for using profanity in the past, and the incident was almost on the eve of the union vote.  The employer was unable to show that the posting online had harmed its business.  But in another context, using union organizing as a shield to insult supervisors’ mothers may not work.

U.S. Supreme Court
U.S. Supreme Court

Over the last week or so, there have been two prominent Circuit Court decisions addressing whether Title VII (the federal law prohibiting employment discrimination on the basis of race, color, sex, religion and national origin) can be interpreted to also protect employees from being discriminated against because of their sexual orientation.

The Second Circuit, which covers Connecticut, basically said no in a decision last week in Christiansen v. Omnicom Group.  The court did open the door a bit to a claim that an employee was discriminated against because of sex stereotyping.

Yesterday, the Seventh Circuit created the first split at the appellate level, finding that Title VII does cover such claims in the Hivley v. Ivy Tech Community College case.   Jon Hyman, of the Ohio Employer’s Law Blog, does a good job addressing the historic nature of the case here.

Back in 2016, I wrote that it was somewhat disappointing that we were still having these battles at the federal level, considering that Connecticut already had state laws prohibiting discrimination on the basis of sexual orientation.  “Those who are gay, lesbian, bisexual or transgender frankly deserve better, in my view. They deserve their own federal law giving them the workplace protections that Connecticut has given.  Until then, the battles over the scope of Title VII will continue.”

Indeed, the battles are now going to get bigger. One or more of these cases are now likely to get heard at the U.S. Supreme Court level where it is far from certain whether Title VII can really be read so broadly.

Of course, Congress could end these debates once and for all by passing a bill prohibiting employment discrimination on the basis of sexual orientation as I discussed way back in 2008.

But unfortunately, we seem to be no closer to passage of a bill than we were a decade ago.

Connecticut employers should largely ignore the press reports about Title VII and instead focus on their obligations to comply with state law.  Eventually the federal courts will work these issues out, but the issue is mainly moot in Connecticut.

shotYou don’t need to look for a needle in a haystack to figure out this latest case from the Second Circuit.

But you do need to know what “trypanophobia” is.

Ready? Fear of needles.

That becomes important in a Second Circuit court decision yesterday holding that an employee’s fear of needles prevented that employee from performing an essential function of his job and rejecting his disability discrimination claim.

The background of Stevens v. Rite Aid Corp. (download here)  is fairly straightforward as cases go.  As you’ve probably noticed of late, many of the big pharmacy chains have been requiring pharmacists to perform immunizations in order to fill an unmet need for vaccinations in the health care market.

In April 2011, Rite Aid revised its job descriptions for pharmacists to require them to hold a valid immunization certification and noted that immunizations were part of the pharmacists’ essential duties and responsibilities.

The plaintiff in the above case worked as a pharmacist for 34 years.  When the job description was changed, he received a note from his physician explaining that the employee was “needle phobic and cannot administer immunization by injection.”  When he refused to perform that role (and I’m simplifying for purposes of a blog post), Rite Aid terminated his employment.

A trial did not go well for Rite Aid.  A jury determined that the employee had been discriminated against and awarded over $2M in damages.

Hence the appeal.

In reviewing the matter, the the Second Circuit rejected an employee’s disability discrimination claim because the evidence “compels a finding that immunization injections were an essential job requirement.”

While “it is understandable that the jury had sympathy for Stevens, afflicted as he was with an unusual phobia”, “his inability to perform an essential function of his job as a pharmacist is the only reasonable conclusion that could be drawn from the evidence”.

The court also looked at whether there was a reasonable accommodation that could have been provided to him.  But the court said that the employee failed to show a reasonable accommodation existed at the time.  An accommodation does not require elimination of an essential function of the job.

The court case is a very helpful decision in clarifying whether an employer can insist on having its employees perform the essential functions of a job. Too often, employees suggest accommodations that would have them avoid an essential function of the job altogether. This court case should put a damper on such arguments.

For employers, the case is also a helpful reminder on having clear descriptions on what the essential functions of a job are and being able to explain why the duties are created that way.   Nonetheless, employers should still engage in an interactive process with an employee about whether there are any reasonable accommodations that can be provided.

starrWelcome back from summer! Today, my colleague Gary Starr and I bring you the story of an employer that thought that it had done everything right — only to see it all go wrong. 

Imagine this scenario: You, the employer, think you’ve taken all the right steps when hearing about a harassment complaint. You encourage the employee to file a written complaint. You conduct an investigation. You take “prompt remedial action”. What could go wrong?

Well, in a recent case at the Second Circuit, Vasquez v. Empress Ambulance Service, the employer later discovered it had been snookered by the alleged harasser. As a result, its investigation did not uncover what really happened. In fact, the employer — according to the court — had so messed up the investigation that it had charged the victim with actually being the harasser. This should serve as a cautionary tale for employers that investigations need to do more than simply weigh the proverbial “he said/she said” arguments.

What was the case about? 

A recently hired EMT complained she was being harassed by the Company dispatcher. The dispatcher repeatedly asked her out, even after she kept telling him that she was not interested and had a boyfriend. He would put his arm around her whenever he had the chance. He even sent her an “Anthony Weiner” picture of himself. She became fed-up and went to her manager, who asked her to write a formal complaint, which the company would investigate.

The dispatcher learned that she was complaining about him. He then went into his cellphone and changed text messages and included a revealing picture from a woman with whom he had a consensual relationship. He made the materials look like they came from the EMT. He then took screen shots of the doctored texts and photos and presented them to the Company when he was contacted as part of the investigation.

The investigators believed the co-worker’s account. When they met with EMT, she offered to show her phone with the texts and photos, but they declined. Instead they terminated her for sexually harassing the dispatcher.

What happened next?

She sued the employer claiming that she was retaliated against for raising her concerns about being harassed. The employer sought to have the case dismissed because it claimed it acted in good faith, its managers and supervisors were not involved in any harassment, and the decision-makers conducted an investigation and believed what they were told by the co-worker. The Company also argued that there were no allegations that the Company had a discriminatory motive to terminate the employee.

The Second Circuit found that the employer did not have to have a discriminatory motive to be liable for the harassment and retaliation. This was because the co-worker had manipulated the decision-makers so that the Company ultimately ended up being the means by which the co-worker fulfilled his unlawful design. The Court found that that the Company could be liable because it was negligent in the way in which it handled the investigation.

The investigation itself became a vehicle for the harassment to continue, says the court.

The court concluded that the investigation was conducted in such a way that it allowed the dispatcher to significantly impact the outcome. For example, the investigators did not allow the EMT to present evidence that would support her claim that she was the victim. The allegations in the complaint revealed that the dispatcher had tried unsuccessfully to have another employee lie on his behalf about the relationship he had with the victim, which the investigators did not learn. The Court noted that the investigation also failed to identify serious flaws in the dispatcher’s evidence, including the fact that one of the text messages he provided was sent to someone who was asleep, even though a reading of the text showed it was sent during the shift being worked by the EMT.

The Court recognized that a Company would not be liable if it had just got the decision wrong. However, the court found that the employer should not be shielded from liability when it acts negligently and allows a supervisor or a lower ranked employee with a discriminatory or retaliatory prejudice to influence the adverse decision. The flawed investigation undermined the Company’s defenses.

The investigators failed to permit the employee to present evidence that would call into question the documentation submitted by the co-worker. They failed to account for the likelihood that the co-worker might lie to protect his job and paint the woman was the perpetrator and not the victim of harassment. And they treated the dispatcher more as an informant, rather than as a potential suspect. They did not carefully review the timing of the charges and the evidence presented by the co-worker, including the fact that the morning the complaint was filed, he already had printed copies of amorous texts from the woman to substantiate his position.

Quite simply, the sloppiness of the investigation allowed the harasser to manipulate the process.

What’s the takeaway from the case?

Employers faced with charges of harassment or discrimination need to take their investigations seriously. It is not enough simply to talk to the individuals involved, but a thorough review of the statements made and the documents presented must be undertaken and then preserved.

Giving the complaining person an opportunity to respond to the defense being offered against her, is important so that the investigator can fairly weigh the information presented. The company should provide the complaining employee the assurance that the allegations are being taken seriously and that the process has been fair and thorough.

Examining what is presented in a skeptical light is important as is being sure that there is a legitimate basis for the action taken. Employers who do not take harassment and discrimination allegations seriously or who do not conduct thorough investigations will find themselves later trying to explain away their actions.

It’s been a big couple of days for court opinions. Today’s turn: FMLA lawsuits.

When we last talked about the FMLA, it was in the context of the fact that sometimes things about the law are bit complicated.

Well, if you didn’t like the intricacies of the FMLA before, this new decision isn’t going to make things better for you.

In a split from other federal employment laws, the Second Circuit last week held that some employees may be held individually liable for employment claims brought under the FMLA.

The case, Graziadio v. Culinary Institute of America, is sending shock waves throughout the employment law blogosphere (see some posts here and here).

And because the Second Circuit covers Connecticut, employers, supervisors and HR personnel need to read this one very carefully.  FMLA training should be part of training already but this case emphasizes the need to be careful.

So, what’s the court’s test to determine if a manager or supervisor can be individually liable for FMLA violations? The court said it will look to at least four factors:

  1. Whether the manager or supervisor had the power to hire and fire the employees;
  2. Whether the manager or supervisor supervised and controlled employee work schedules or conditions of employment;
  3. Whether the manager or supervisor determined the rate and method of payment; and
  4. Whether the manager or supervisor maintained employment records.

Because the court said this was a nonexclusive list of factors, there could be others. Not that we’ll find that out here, but something to be aware of.

In this case, the court said that there was substantial evidence of the test being met regarding the HR manager. For example, because the employee was fired for job abandonment and the VP of Administration deferred to human resources, it found that the HR manager handling the FMLA leave ended up having hiring/firing authority.

And because the HR manager was overseeing the terms of the FMLA leave, the court found the supervisor also controlled the schedule and condition of employment.

While evidence of the other two factors may not work in favor of individual liability, the court said the evidence was enough anyways.

Nevertheless, on the overarching question of whether (HR Director) Garrioch controlled plaintiff’s rights under the FMLA, there seems to be ample evidence to support the conclusion that she did: deposition testimony and email exchanges demonstrate a) that Garrioch reviewed Graziadio’s FMLA paperwork, b) that she determined its adequacy, c) that she controlled Graziadio’s ability to return to work and under what conditions, and d) that she sent Graziadio nearly every communication regarding her leave and employment (including the letter ultimately communicating her termination). Indeed, Garrioch specifically instructed [others] that they were not to communicate with Graziadio and that Garrioch alone would handle Graziadio’s leave dispute and return to work. …Given all this evidence, we conclude that a rational jury could find, under the totality of the circumstances, that Garrioch exercised sufficient control over Graziadio’s employment to be subject to liability under the FMLA.

Before we get to the takeaways, there’s also another portion of the court’s decision worth noting (as The Employer Handbook blog also noted).  It shows how e-mail isn’t necessarily the best approach to trying to resolve FMLA issues. A phone still works too and the HR Director’s failure to close the lines of communication seemed to worked against her:

Finally, [after many e-mails, HR Director Garrioch] announced that she would no longer be able to discuss this matter over email and asked [Plaintiff] Graziadio to please provide three dates/times for this week that you are available to come into work and meet with me.

In an excruciating exchange, Graziadio and Garrioch then proceeded, over any number of days, to email back and forth about scheduling a meeting without actually arranging it: Garrioch would ask for dates and times, Graziadio would respond that she was “available whenever,” Garrioch would again ask for specific times, Graziadio would insist that she was “available any time or day,” and so on. Early on in this exchange, Graziadio also forwarded Garrioch an updated FMLA certification for Vincent, but Garrioch did not acknowledge receipt of the certification or otherwise respond to that email. At another point, Graziadio attempted to circumvent the circular exchange by simply “requesting to return to work” on a “full time regular schedule.” Garrioch rejected this request and again insisted that Graziadio appear for a meeting before she could return to work.

Ultimately, no one set a time for a meeting, and Graziadio, facing persistent involuntary leave, retained an attorney.

This case is likely to change the way FMLA claims are litigated in the state. Individual supervisors and/or HR directors may now be brought in as additional parties on the defense side.  While employers may indemnify those individuals in nearly all of those cases, it still can be quite unnerving to be a party to a lawsuit.

If you have employment practices liability insurance, it may be time to review that policy to ensure that it covers supervisors who may be sued individually as well.

And, as a reminder, FMLA is not the easiest of statutes to follow. Be sure to stay on top of the certification process and document the steps you have taken.  Individuals may face liability for the actions if they don’t.

aslWhat does it really mean to provide a reasonable accommodation to an employee who has a disability?

That’s a question I talk about a bunch with clients.  The employee may request one thing but the employer may think that another accommodation can accomplish close to the same thing, perhaps at a lower cost.  Who wins?

It’s not a new question; I’ve talked about it before here on the blog too.

But a recent case by the Second Circuit adds some layering to that discussion.  The case, Noll v. IBM, isn’t one that you’ll see on the front page of The New York Times.  I found out about it from the always reliable (and underrated) Wait a Second Blog.

That blog’s recap is appropriate here:

Noll worked in Poughkeepsie, N.Y., but IBM is a huge corporation for which internal communication were broadcast over a company-wide intranet. Noll asked for captioning of certain intranet videos or transcripts of audio files. Instead, as noted above, IBM gave him transcripts and access to ASL interpreters. Noll said these alternatives were not good enough it was “confusing and tiring” to look back and forth between the video and the ASL interpreter. Also, it sometimes took five days or longer for transcripts to be made available to Noll, and links to the transcripts were sometimes broken.

The IBM Media Library stores over 46,000 video files (!), only 100 of which were captioned.  As for live meetings, IBM provided him with ASL interpreters and Noll found those to be “effective.”  But he didn’t like the interpreters for the videos because he found it “confusing and tiring.”

The Second Circuit noted that determinations of the reasonableness of accommodations are typically fact-specific, but summary judgment can be granted to an employer if the accommodations are “plainly reasonable.”  (Pro tip: If the court is setting forth this standard, you can figure out where it is headed.)

This is an important point to emphasize and the court seems to be setting forth a standard that hasn’t been utilized much before in discussions. “In other words, the plain reasonableness of the existing accommodation ends the analysis. There is no need to engage in further burden‐shifting to consider whether the employee’s requested accommodation would have been reasonable.”

Reasonable accommodation can take many forms, but must be “effective”, the court said.  And, at the same time, employers are not required to provide the “perfect” accommodation or even the “very accommodation most strongly preferred” by the employee.  “All that is required is effectiveness.” 

Here, the court found that the accommodations from IBM were indeed “effective”.  While Noll said the interpreters were not as effective as captioning and that it was “tiring” to watch it, that objection is not enough to get him to a jury trial, let alone victory.

This disadvantage does not render interpretive services ineffective. A person who is deaf necessarily receives auditory information from other senses (principally sight); so it can be expected that many accommodations of deafness — ASL interpretive services as well as captioning — will tax visual attention to some degree. An accommodation for deafness therefore cannot be rendered ineffective by the need to divide visual attention, without more.

For employers, this is an important case to consider. IBM here had access to many more resources than most employers. And even with all the services it provided, it was sued for still not doing enough. The Second Circuit put an end to that — no doubt after IBM spent significant sums to defend itself.  Smaller employers may not be so fortunate.

Still, for employers, showing that you have entered into the interactive process with employees and provided what it believes to be an “effective” reasonable accommodation can still provide a path to success if sued.

When the U.S. Supreme Court changed the standard for proving retaliation cases back in 2013, there was some speculation as to whether the standard would result in different decisions.

Before the court’s decision, employees who claimed they were retaliated against, needed to show only that the retaliatory motive was a “substantial or motivating fact” affecting their termination.  The Supreme Court ruled in University of Texas Southwestern Medical Center v. Nassar heightened that standard, requiring employees to show that an employer would not have taken an adverse employment action “but for” a retaliatory motive.

When that decision was released I said, “It will be tougher to establish a retaliation claim when you have to show that the termination wouldn’t have happened “but for” the retaliatory motive. “

Now we have proof.  And it actually follows from a case I first reported on about 18 months ago.

In Cassotto v. Donahoe, the Second Circuit last week affirmed a jury verdict on favor of the employer.  In the same case using the older standard, a jury had first found in favor of the employee in a termination case.  But while the case was pending a motion for new trial, the Supreme Court issued its decision.  The District Court then granted the employer’s request for a new trial; the employer won that second trial.

In its decision, the Second Circuit said that the District Court did not abuse its discretion in granting a new trial.

Considering [the employee’s] purely circumstantial evidence of retaliation and the defendant’s evidence suggesting a legitimate alternate explanation for his termination, we cannot say that the district court abused its discretion by concluding that the incorrect instruction on causation might have affected the verdict, that a correct instruction conveying a heightened standard might have led to a different verdict, and that a new trial was therefore warranted.

With a bit of humor, the Court adds a kicker in a footnote: “Indeed, at the second trial, the properly instructed jury returned a verdict for defendant, resulting in the judgment now under review.”  In other words, the District Court didn’t err because its self-evident that the new standard made a difference in the outcome.

For employers, the decision is an important reminder when discussing settlement or considering a motion, that the new standard for retaliation cases does have some teeth to it.  It should impact the value of cases and this case is a good example of that.

And while we haven’t yet seen a big dropoff yet in retaliation cases filed at the EEOC (much of the data has yet to be released), the long-term impact of the Supreme Court’s decision is only beginning to be realized.

Cassotto v. Donahoe

 

Last Friday, lawyers representing two government officials petitioned the U.S. Supreme Court to hear arguments over whether former a 2002 state decision to layoff only union personnel violated those employee’s constitutional rights.

Back in June 2013, you may recall that the Second Circuit ruled that such layoffs did violate the right of association.  I’ve discussed the background of the case (and my very early involvement in it) in several prior posts.

In asking the Supreme Court to review the case, the officials state that there are two questions for the court to consider:

1. Are a governor’s subjective motives for exercising a state’s inherent power and contractual right to reduce the size of its unionized workforce legally relevant when a court is asked to determine the constitutionality of that legislative act?

2. Did the Second Circuit err in requiring strict scrutiny of a governor’s decision to reduce the size of a state’s unionized workforce by falsely analogizing that decision to firing state employees based on their political party affiliation?

You can download the filing here.

Part of the officials’ argument is that there should be a difference between an executive order to eliminate positions (a “legislative” act, according to the officials) versus a directive to fire specific employees.  Moreover, the motive of state officials performing such legislative acts should be irrelevant as well, says the petition, arguing — in likely a direct appeal to the court’s more conservative wing — that “The growth in motive-based constitutional torts must be reined in.”

The state has filed a separate petition as well.

The court is expected to rule on the petitions by December or January.

Despite the meatiness of the issues presented, the petitions still face a significant uphill battle for two reasons. One is pure numbers.  The court refuses to hear the overwhelming majority of cases that it is asked to hear.  But second, the brief fails to highlight any significant split of authorities that exists in the lower courts. Without such a split, the Court typically rejects such challenges unless the issues presented are of such significance that it cannot wait for that split to develop.

What happens if the petitions are rejected? Well, the petition does suggest that the fight may not be over for the government officials since the case will be sent back to a lower court.  In a footnote, the officials state that they remain free to assert an “absolute legislative immunity defense” if the claims are ultimately remanded to the district court for trial.

The case continues on.

2d Circuit Opens Door to Class Action Waivers

Continuing my series of posts this week on recent Second Circuit FLSA cases, today I’ll talk about class action waivers and arbitration clauses.

If that last clause is just legalese to you, let me try to walk you through it and why employers should care deeply about it.

As I’ve covered in prior posts, wage & hour claims, typically brought by one employee on behalf of others (known as a collective or class action) have been all the rage for the last decade.  Employers have struggled with how to rein such actions in because litigation them can be costly.

In doing so, employers have tried to use two defense mechanisms. First, employers have tried to get employees to agree to arbitrate all claims before a neutral third party. That typically keeps costs down because arbitrations are quicker and more efficient.

Second, employers have tried to get employees to forego their ability to join a class action. In other words, employees can sue to recover their own missing overtime, but not for hundreds of other employees too. I foreshadowed this in a post back in March.

Recent pronouncements by the U.S. Supreme Court have opened to door to these arguments. Earlier this month, the Second Circuit just made that door a lot wider.

The case, Sutherland v. Ernst & Young, strengthened the ability of employers to use arbitration agreements and to include a class action waiver in them even under the Fair Labor Standards Act.  It upheld both types of provisions relying on the U.S. Supreme Court cases.

For employers, this decision is important because it now provides employers with a tool to use to try to limit exposure in wage & hour cases and more.   Of course, whether arbitration agreements or class action waivers is right for your particular business is something that you should discuss with counsel and may depend on a variety of circumstances.

In the meantime, though, this is not the end of the battle on this issue. The National Labor Relations Board has come to a different conclusion and it remains to be seen how the U.S. Supreme Court will confront the issue. However, I have a hunch based on the prior precedent, that its just a matter of time before the U.S. Supreme Court decides this issue once and for all (and probably in the employer’s favor.)