Sloan Work and Family Network published a list of the Top 10 Posts from its blog for 2009 and I am so honored that my post, The Four-Day Workweek and the Death of the Flexible-Workplace Initiative, ranked #1! The four-day workweek got a lot of publicity in the latter half of 2008 and early 2009 but lost its fizzle as the economy continued to worsen. Although the concept was touted by advocates as a way to promote a flexible work schedule, I argued that it served the exact opposite purpose and served to create an inflexible workplace.
February 2010 Archives
GINA, the Genetic Information Nondiscrimination Law of 2009, is the first new federal discrimination law in decades.
Although EEOC regulations are promised (the proposed regulations were published back in March 2009 and the comment period has been closed since May 2009) , they have yet to issue, leaving employers on their own to interpret this brand new statute.
One area which presents an interesting question is the role of social media in GINA. Unlike other discrimination laws, GINA makes illegal the mere acquisition of genetic information, which is defined broadly to include, among other things, information about manifested diseases of family members. There are many exceptions to this rule, including “commercially and publicly available information,” such as newspapers, magazines, periodicals, and books. The EEOC specifically invited public comment on whether “commercially and publicly available information” should include personal Web sites or social networking sites.
If these are NOT included within the exclusions, it would mean that if an employer reviews an applicant or employee’s Facebook or MySpace page, and learns genetic information in the process, it is in violation of GINA. Given GINA’s broad definition of “genetic information,” this could easily occur. For instance, discovering on Facebook that an employee marched in a Susan G. Komen Race for the Cure on behalf of her mother would reveal genetic information.
If this advertent act (review of Facebook, Google name search, etc.) inadvertently produced genetic information – the employer would still be on the hook unless social media is included within the “publicly available” exclusion. Therefore, if information obtained from social media is NOT considered to be “publicly available,” employers will have to reconsider how they conduct background checks, since even the most rudimentary background checks currently include a “Google” search and review of any online information it turns up.
Even if the regulations specify that social media is excluded from the acquisition portion of the statute, the thornier issue is what happens after an employer has this information, whether deemed advertent or inadvertent under the statute. As a result of GINA, any adverse employment action which occurs after an employer has such information may be suspect. Just like any other discrimination, timing and stray comments may each play a role in developing causation between the membership in a protected class and the adverse employment action. As discussed in my previous post, Pink Ribbons and Yellow Bracelets, “genetic information” is everywhere. It will be hard for employers NOT to learn this type of information about their employees.
Thus, employers and their managers must understand the significance once this type of information is learned by the employer. It does not mean that the employee has to be treated better than other employers. It does mean, however, that employers need to be on alert once genetic information is learned about an employee. Like any other protected class, employers need to be cognizant of suspicious timing and mindful that documentation regarding any legitimate performance issues is in order, before taking any adverse employment action.
Want to learn more about GINA and its implications for employers? There are many opportunities: I will be presenting on GINA at the CUPA/SHRM conference on March 2; in an audioconference on May 4, sponsored by M. Lee Smith; and at the Annual Seminar on Employment Law hosted by the Delaware State Bar Association on May 11. Stay tuned for more details on the audioconference and DSBA event.
Until then, learn more about GINA with these earlier posts:
And, for more about the impact of social media on the workplace:
After months of moribundity, the Employee Free Choice Act (“EFCA”) is showing signs of life. Or at least alternative means of imposing some of the major changes included in EFCA, such as greatly decreasing the time of an election campaign and limiting employers’ ability to actively participate in union elections, are being considered. It all depends on the possible confirmation of Craig Becker, whose nomination to the NLRB has been stalled in the Senate but was recently voted out of committee on a party line vote.
The theory goes that if Becker, who is currently Associate General Counsel of the SEIU, is confirmed by the full Senate, giving former union lawyers a 3-2 majority on the Board, strange (and bad) things may occur. Becker’s past published writings include such one-sided suggestions as excluding employers from participating in pre-election hearings to determine an appropriate bargaining unit, preventing employers from alleging that union campaign conduct coerced employees, and prohibiting employers from conducting mandatory meetings of employees at any time during the campaign (instead of only during the 24 hours before the election, as at present).
Given Becker’s extreme views, the theory goes, new NLRB Chairperson Wilma Liebman should have no trouble getting the majority of the Board to agree to embark on expanded rulemaking and in that fashion, impose many of the EFCA changes indirectly. Liebman has made no secret of her interest in having the Board expand its rulemaking activity, instead of limiting itself to ruling on cases presented to it.
CUPA-HR Eastern Pennsylvania and Delaware Spring Chapter Meeting
March 2, 2010 | 9:00 a.m.-3:00 p.m.
Registration Opens at 8 a.m.
Doberstein Academic Center
320 N. DuPont Highway, New Castle, Delaware 19720
The Eastern Pennsylvania CUPA-HR chapter invites you to join us for our annual Spring Meeting on March 2, 2010. For the first time, the Eastern Pennsylvania CUPA-HR chapter is partnering with the Delaware Chapter of the Society of Human Resource Management(SHRM).
Our topics will be related to Employment Law updates as well as other legal issues. Topics will include: Social Networking and the Workplace, Retaliation & Whistleblower Claims, FMLA/ADA Update, Avoiding Wage and Hour Claims, Getting to Know GINA. The discussions will be led by employment-law attorneys from Young, Conaway, Stargatt & Taylor.
CUPA-HR Eastern Pennsylvania Members: Free
CUPA-HR National Members: $15. Non-CUPA-HR Members: $30.
Cost includes continental breakfast, lunch and handouts.
Please RSVP to Vicki Stewart at vstewart [at] ycp.edu by February 20, 2010.
Delaware Department of Labor (DDOL), has published its yearly statistics for FY2009 relating to the charges of discrimination filed with its Office of Anti-Discrimination. Here are some highlights:
It may not come as a surprise that the most-often filed charge was a retaliation charge, making up just over 70% of all charges filed. Where a charge alleges more than one basis, each basis was counted separately, which explains why the total is higher than 100%. It also indicates that retaliation is very often added as a second basis to a charge that alleges other types of discrimination.
Again, not surprisingly, DDOL had a very busy year, with intakes at a five-year high.
Electronic monitoring is a very hot topic in employment law these days. But what about other types of electronic monitoring by employers? A case filed in the U.S. District Court for the Eastern District of Pennsylvania alleges a much more unusual sort of electronic monitoring. The suit alleges that Lower Marion School District distributed over 1,800 laptops to its students. So far, so good.
But, according to the Complaint (via Above the Law), the laptops were equipped with webcams.
How could this not end badly?
The suit alleges that school administrators remotely activated the webcams. One is alleged to have gone so far as to discipline a student for “improper behavior in his home." Funny, I've never seen that one in a student code of conduct. It is also alleged that the District was also tracking all the students' online activity.
Employers commonly provide employees with laptops for business-related use. If your organization is one such employer, maybe consider skipping the upgrade to the models with webcams.
Delaware employees are not very satisfied with their work. In fact, according to the results of a recent Gallup poll, Delaware workers are the least satisfied in the entire country. When Delaware reporter Eric Ruth alerted me to the poll results I was, admittedly, stunned. I never would have guessed that the employers in our State are failing so badly to keep their workforce engaged. Being a self-proclaimed evangelist for the workplace-engagement initiative, I feel compelled to do whatever I can to improve Delaware’s wretched statistics. But where to start? How about with the basics.
Employee engagement can be difficult to define. I’d suggest that it consists of two types of passion. The first passion is felt towards the employer; the second is towards the work. For example, a nurse may love her work (i.e., providing health care to those in need) but may detest her employer. A disengaged employee, on the other hand, also is passionate about his employer and about his work. The difference, though, is that the passion he feels is a negative one. In the worst case scenario, the disengaged employee is passionate about sabotaging his employer and its efforts.
As noted by Michael Fox in a recent post on his Employer's Lawyer blog,, an OFCCP Administrative Law Judge (ALJ) just released a 66-page decision in a case that began with an audit notice in 1993. The case was bogged down in large part due to the bank’s contention that it was not selected for audit in accordance with its constitutional right under the Fourth Amendment to be free from unreasonable searches and seizures. That claim was ultimately unsuccessful. As a result of the delay, though, the bank found itself litigating claims about hiring practices dating back to 1993. Not surprisingly, the recollections of key witnesses such as the recruiters were foggy on some points.
But, in essence, the trial boiled down to a battle of the experts, who each advocated his or her own method of statistically analyzing the hiring data. The analysis of the OFCCP’s labor economist/statistician disregarded several of the bank’s legitimate business reasons for rejecting applicants because of evidence provided by the recruiters regarding how they coded applicants.
For each applicant, the recruiters were to use a code to indicate the outcome of the application. For example, they used a certain code to indicate that the applicant was not interested in working the hours that were available, and another code to indicate that the applicant had failed the credit check. Unfortunately, the recruiters testified that they did not use the code consistently.
If someone told the recruiter that her or she was not interested in the hours and/or the wages being offered, the recruiters sometimes used the code for “no position available” rather than the code used to indicate that the hours or wages were not acceptable to the applicant. To the OFCCP’s expert, this justified treating the hours code as entirely unreliable.
He also disregarded the code the recruiters used to indicate that the applicant was rejected based on his or her credit report for several reasons: (1) the recruiters did not have a consistent system for screening based on a credit report, (2) there was no evidence validating the use of credit reports as a test for success in the job, (3) the bank stopped using credit reports in 1994, and (4) the use of credit reports as a screening device adversely impacted African-Americans. The bank had not retained copies of the credit reports, so it was not possible to determine whether the recruiters used the credit reports in a consistent way as between white and African-American applicants.
When the employer’s expert analyzed the hiring decisions and excluded the people who had been rejected based on hours preferences or the credit check, the outcome was that there was no statistically significant evidence of discrimination. When the OFCCP’s expert analyzed the same hiring decisions but included the applicants who had been rejected based on the hours and credit check results, there was strong statistical evidence of discrimination.
The ALJ also rejected the bank’s expert’s opinion that the bank had hired more African-Americans for the jobs in question than would be predicted if the analysis had been based on the overall availability statistics for the Charlotte metropolitan statistical area for 1993. The ALJ wrote that “it is well established that the applicant flow data, which documents the actual labor pool relevant to the hiring decisions at issue, is ‘highly relevant evidence of an employer’s labor market.’”
This proposition is one that, in my experience, is theoretically appealing but completely out of sync with reality. The reality is that applicants’ self-identification of race and gender by applicants is voluntary, and a large number of them do not self-identify. Consequently, the employer, the courts and labor economists running statistical analyses will never have an accurate picture of the racial characteristics of the “applicant pool” from which the hires were made. Given that the information about the race and gender of the “applicant pool” is always incomplete and inaccurate, it is difficult to understand how applicant flow data can be more relevant and reliable than census data.
Anyway, this case still is not over. The ALJ has to decide what the damages number will be, and after that, if the case does not settle, appeals seem likely.
The February 2010 issue of Law Practice Today, the webzine published by the ABA's Law Practice Management section, is now available and can be read in its entirety at the Law Practice Management section's website. I was the issue editor for this edition, which focuses on the Human Resources side of management. The articles are great and offer lessons that apply to all industries. They include:
All of the articles are excellent but I want to give an extra-loud "thanks" to fellow employment-law bloggers, Jon Hyman of the Ohio Employment Law Blog, and Phil Miles of Lawffice Space, who each wrote features for the webzine. John authored Avoiding Retaliation Liability, which deals with the hottest topic in employment litigation these days and gives great advice on how not to become a defendant in a retaliation lawsuit. And Phil wrote Fostering an Entrepreneurial Spirit in Associates, which reminds us of the undeniable link between engagement, motivation, and success.
Employers' use of independent contractors instead of traditional employees has been on a steady incline over the past 20 years. Some employers feel that they can save money by using independent contractors instead of full-time employees. The contractors themselves may value the autonomy and economic perks that the status provides. Also, the specific skills and knowledge that independent contractors can bring to a short-term project can be critical and, therefore, worth a premium but not sustainable in the long term. But the use of independent contractors is not as perfect as these mutually beneficial points may seem.
A report prepared by the U.S. Government Accountability Office (GAO) in the Fall of 2009 concluded that employee misclassification is a “significant problem” with “adverse consequences” because it reduces tax revenues flowing to the government. In fact, the misclassification of employees as contractors is estimated to cost the Treasury Department over $7 billion in lost payroll tax revenue over the next ten years.
So the theory goes, since independent contractors are, by definition, self-employed, they are not considered “employees” and thus not covered by various tax withholding laws. Independent contractors also are not subject to most employment laws, so in addition to avoiding taxes, some employers may reclassify employees as independent contractors in order to avoid payment of overtime and benefits, and workers’ compensation liability.
And, thus, the crackdown on the misclassification of employees as independent contractors began. he U.S. Department of Labor (DOL) has made the proper classification of employees and independent contractors one of its "top priorities." The agency’s 2011 budget includes an additional $25 million for what it calls the “Misclassification Initiative” designed to target misclassification of independent contractors. Approximately 100 additional DOL enforcement personnel will be added to investigate employers.
The Internal Revenue Service (IRS) is in the middle of a similar misclassification crackdown. Beginning in February 2010, the IRS will commence intensive audits of randomly selected employers. One of the focal points of the audits is whether the employers are improperly misclassifying workers as independent contractors to save on taxes and employee benefits.
There’s also new federal legislation on the horizon. Congress is expected to take up legislation that will penalize employers for employee misclassification. One proposed piece of legislation, known as the Independent Contractor Proper Classification Act, was sponsored by President Obama when he was a member of the U.S. Senate.
States are getting into the enforcement act as well. New York and Massachusetts have created task forces to locate employees who are misclassified. Other states such as Maryland and Colorado have enacted new laws that impose harsh penalties on employers who misclassify employees as independent contractors.
Here in Delaware, the General Assembly passed its own law last year imposing stiff penalties on construction industry employers who improperly classify employees as independent contractors to save on business costs and avoid paying appropriate taxes. In addition to penalties of $1,000-$5,000 per misclassified employee, employers who fail to produce requested records can be issued a stop-work order by the Delaware Department of Labor and fined up to $500 per day for each day during which the requested records are not produced.
Compliance, though, presents its own difficulties. The tests used to determine whether someone is an independent contractor or an employee are fact intensive and differ among government agencies. In addition, each state may have its own unique test to determine a worker’s proper status.
Still, the penalties for non-compliance make this a treacherous area for the unwary employer. In addition to federal and state governments seeking unpaid payroll taxes and associated penalties, employment lawsuits in this area are becoming increasingly common. Claims from misclassified workers range from those seeking unpaid wages and overtime, to multi-million dollar class actions lawsuits. Misclassified employees have also successfully recovered retirement benefits, medical coverage for injuries they sustained on the company’s property, and rights to employee stock options and bonuses.
Given the increased attention to this area, the time to act is now. An internal review and audit of worker classifications should be a crucial component for any company that currently employs independent contractors.
Delaware Governor Jack Markell declared a state of emergency and instituted a driving ban limiting driving to emergency vehicles only as a result of the record-setting snow storms that hit the Northeast this week. While State government strongly urged employers to consider their employees’ safety and close their businesses for the duration of the state of emergency, nothing prohibited employers from opening for operation during the storm.
But employers should consider more than employee safety when choosing to open their businesses during a state of emergency. At least one case, decided by the Delaware Superior Court after the blizzard of 1996, noted that an employer could be liable for an employee’s injuries if the employee was called in to work during a state of emergency.
While the general rule is that an employer is not responsible for an employee’s injuries if those injuries are sustained outside of the employer’s property, there are exceptions. One such exception is that an employer may be liable for an employee’s injuries, sustained while travelling to the employer’s property, if the employee is called to work when he was not otherwise expected at work. This exception has not yet been applied to a case where an employee is injured coming into work during a state of emergency.
In the end, while it may be financially costly, employers will garner employee good will and avoid liability for employee injuries by closing during a state of emergency.
Garrison v. State, No. 96A-05-004, 1996 Del. Super. LEXIS 443 (Del. Super. Ct. Oct. 8, 1996).
Restrictive covenants include agreements by an employee not to compete, not to disclose confidential information, and not to solicit an employer’s clients. Based on a recent decision from Delaware’s Court of Chancery, these agreements are more valuable than ever. Deciding a novel issue in Delaware, the Court held that, absent a provision to the contrary, restrictive are assignable from one employer to another, so long as both employers are engaged in the same business. This means that when businesses merge, employees who are already subject to restrictive covenants with the acquired business do not have to execute new agreements with the acquiring business. In addition, the Court reminds us that contracts defining the employer-employee relationship, are the only way to prevent a competitor from poaching employees in an at-will employment state, like Delaware.
The background in Great American Opportunities, Inc. v. Cherrydale Fundraising, LLC, is one that will be familiar to many employers. Three businesses were competing in the surprisingly cut-throat world of third-party fundraising (selling fundraising materials to non-profit organizations such as schools and churches, who then sell the materials to their communities to raise money). Two of the businesses, Great American Opportunities, Inc. (GAO) and Kathryn Beich, Inc. (KB) merged, leaving GAO as the surviving business. At the same time, the third business, Cherrydale Fundraising, saw an opportunity to expand its market presence by hiring away several of KB’s sales representatives. GAO discovered what was going on shortly after the merger.
To KB’s credit, it had been a careful employer and almost all of its employees were subject to the trifecta of restrictive covenants: non-competition, non-disclosure, and non-solicitation contracts. However, GAO was not a party to any of these contracts. Faced with a complicated situation, GAO filed a lawsuit alleging that Cherrydale tortiously interfered with the contractual relationship between GAO and its employees, leaving the Court to sort out the details.
Before it could address Cherrydale’s activities in poaching KB’s employees, the Court had to decide if there was any formal relationship between GAO and KB’s employees as a result of their merger. Cherrydale argued that Delaware’s doctrine of at-will employment prohibits a claim of tortious interference with a contractual relationship. But KB’s employees were subject to a contract, as they had signed non-competition, non-disclosure, and non-solicitation contracts. Thus, Cherrydale’s first argument was unsuccessful.
The Court next had to determine whether KB could lawfully assign its rights under the employees’ restrictive covenants to GAO, in conjunction with the sale of a business. Surprisingly, this was an issue that had not been thoroughly analyzed under Delaware law. Adapting the general rule that contract rights may be assigned absent a provision prohibiting assignment, the Court held that an employer’s rights under a restrictive covenant may be assigned, in conjunction with the sale of a business, so long as the former employer and the current employer engage in the same type business.Bottom Line For employers who have workers with specialized skills, restrictive covenants, including non-competition, non-disclosure, and non-solicitation contracts, are as important as ever. In Delaware and other at-will states, such contracts are the only thing preventing your competitors from poaching your employees and their valuable know-how. But restrictive covenants are now more valuable because they can be assigned from one employer to another in a merger or asset sale. So if your employees are not subject to restrictive covenants, now is a better time than ever to consider whether they may be right for your business’s circumstances. Great American Opportunities, Inc. v. Cherrydale Fundraising, LLC, C.A. No. 3718-VCP (Del. Ch. Ct. Jan. 29, 2010)
I talk a lot about how Human Resource professionals can use social media for a variety of workplace initiatives, ranging from recruiting, to engagement, to internal communications. For the uninitiated, though, the topic "social media" may have little real resonance. If you're an HR pro new to social media, there are three key types of social media that you need to understand at a bare minimum. Here's a primer on each.Blogs
The word blog is short for “web log.” The author writes about topics he is passionate about, topics he wants others to learn about, or just his daily thoughts. The frequency of blog entries, called posts, depends on the topic and the blogger, and can range from multiple times daily, to weekly, to far less often.
In the hiring context, organizations can use blogs for several purposes, including: (1) improving the organization’s web presence (also known as search engine optimization or SEO); (2) humanizing the organization by projecting a public but personal voice; and (3) advertising particular job openings.
Microsoft Job’s Blog is an outstanding example of a recruiting blog done right.
Social-networking sites allow people to share information about themselves and to search for others with whom they can share information and form beneficial relationships. These sites are the modern version of the Kiwanis Club, the Rotary Club, Junior League, and local country clubs.
Facebook and LinkedIn are currently the most popular sites for recruiting efforts. LinkedIn targets professionals, particularly in knowledge industries, such as the information-technology, management, financial, and legal sectors. LinkedIn also targets an older demographic, though the average age of Facebook users continues to rise.
In the hiring context, organizations can utilize social-networking sites as a way to: (1) attract individuals who are not necessarily looking for employment (i.e., “passive candidates”); (2) provide current candidates with an inside look at working life inside the organization; (3) locate potential candidates for particular job openings; and (4) actively recruit high-potential candidates who may or may not be looking for employment. Another, increasingly common but less known use of social-networking sites by employers is keeping ties with former employees, known as alumni.
Some excellent examples of Facebook pages for recruiting include Hyatt Hotels and Resorts, the U.S. Army, and the CIA.
The HP Alumni group on LinkedIn, is an example of how organizations can leverage their alumni employees. There are also groups devoted specifically to HP alumni in certain geographic regions, as well as groups just for certain job types, such as sales.
Audio and Video
Posting videos online, either on your website or on sites like YouTube gives candidates a real-world preview of the work environment. Videos also can humanize your organization by putting a real employee as the public face for potential candidates.
KPMG’s branded YouTube channel, is one example of how to use video effectively. Google, not surprisingly, also puts YouTube to great use with its “Life at Google” channel, one of 27 channels it maintains on YouTube.
Learn more about social media in the workplace.
With the weather forecast predicting record-setting snowfall in the Northeast, many employers are preparing to close operations again tomorrow. But how to handle snow days when it comes to calculating payroll? Here's the run-down.
The Fair Labor Standards Act (FLSA) prohibits employers from reducing the pay of any exempt employee based on the quantity or quality of his work or when he is ready, willing, and able to work but no work is available. Applying that basic principle, the U.S. DOL has taken the position that employers that decide to close because of weather conditions must pay exempt employees their regular salaries for any shutdown that lasts less than one full week.
On the other hand, nothing prohibits an employer from requiring employees, including exempt ones, to use accrued vacation time or other time off to cover the missed work. The FLSA doesn't require you to provide vacation or leave time at all, so there's nothing to prevent you from giving your employees vacation or paid time off (PTO) but then requiring them to take it on certain days. A private employer may therefore deduct the period of absence due to bad weather from an employee's remaining vacation or leave time, whether the absence is a full day or a partial day, so long as you pay exempt employees their regular salaries for that time.
The practical problem, of course, is that when bad weather hits, some exempt employees may not have any vacation or leave time left. Or they may have already scheduled to take off — and received approval to use — whatever vacation or leave time they have remaining. Even if an exempt employee has no time off remaining, she still must be paid her regular salary when the organization is closed because of bad weather for less than a week. The DOL has made it clear that you must pay employees in those circumstances, even if you offer no vacation or PTO benefits at all and even if you provide those benefits but the employee has no remaining accrued leave available.
There's no legal prohibition against applying PTO to days missed because of a facility closure and canceling part or all of approved vacation time for exempt employees who have time remaining but have approved plans to use their PTO on other days. You should first consider the inevitable negative effect of that practice on employee morale, however.
In today’s culture of pink ribbons, yellow bracelets, and fundraising walks, it is not hard to imagine the multitude of ways an employer might learn about the genetic test or manifestation of a disease by a family member. Loved ones often become involved with organizations specific to the disease of their family member, and even sometimes starting their own. The employee’s membership in or leadership role in such organizations might well be reflected on their resume or application. Such relationship is likely to be disclosed on an employee’s Facebook, Twitter, or MySpace page. A quick Google search on an application, now typically performed in the most rudimentary background check, would reveal this information.
As noted in Parts 1 and 2 of this series, GINA’s inclusion of a “manifested disease” of a family member does not limit diseases to those with a genetic component. Therefore, an adult employee caring for a parent with lung cancer (which is generally accepted to be caused by environmental, not genetic influences), would be covered by GINA if he could show that his employer knew about the manifested disease of his parent, and treated him differently as a result. So would a parent with a child recently diagnosed with leukemia.
Health care coverage for a dependent in the face of a crippling diagnosis for a child is understandably, among the top concerns for any employee faced with this situation. There is a tremendous amount of fear in losing that coverage and an employer’s response to the knowledge that the employee may cause the employer to incur hundreds of thousands of dollars in healthcare costs. For an employee who is terminated in close proximity to a child’s diagnosis, one can easily appreciate the conclusion such employee may draw about the cause of the termination.
GINA is likely to be a valuable add-on to existing statutes applicable in caregiving situations. These scenarios present highly sympathetic plaintiffs, and juries ready to find employers culpable of economic incentives. GINA may just be the hook many caregivers need to grab onto a claim, and its reach in this regard should not be underestimated.
Parts 1 and 2 in the series:
The EEOC published a press release a few days ago about the distribution of a $6.2 million settlement it had reached with Sears, Roebuck & Co. The lawsuit had been filed in November 2004 in federal court in Chicago. The consent decree was entered and publicized on September 29, 2009 as the largest ADA settlement in a single case in EEOC history. The EEOC Regional Attorney handling the case stated:
The era of employers being able to inflexibly and universally apply a leave limits policy without seriously considering the reasonable accommodation requirements of the ADA are over. Just as it is a truism that never having to come to work is manifestly not a reasonable accommodation, it is also true that inflexible leave policies which ignore reasonable accommodations making it possible to get employees back on the job cannot survive under federal law. Today's consent decree is a bright line marker of that reality.
The EEOC had complained that “Sears maintained an inflexible workers’ compensation leave exhaustion policy and terminated employees instead of providing them with reasonable accommodations for their disabilities, in violation of the ADA.” The settlement resulted in payments averaging $26,300 to 235 former Sears employees.
This is not the only such case pursued by the EEOC. The EEOC filed a class action lawsuit suit against UPS in Chicago on August 27, 2009. According to the EEOC press release, the case was initially prompted by an investigation into a complaint that UPS had fired an employee with multiple sclerosis after she exhausted the twelve months off to which she was entitled under the UPS leave of absence policy. She had asked for 2 more weeks of leave so that her medications could be adjusted, but UPS allegedly refused to provide it.
In November 2009, the EEOC reached a settlement with JPMorgan Chase & Co. in a class action based on similar allegations. The EEOC alleged that Bank One, which later merged with Chase, had terminated some employees after they exhausted six-month medical leaves without first investigating on a case-by-case basis whether it was possible to accommodate their limitations so that they could return to work. As a result of the settlement, $2.2 million was to be distributed among 222 individuals who had taken long-term-disability leave and were then terminated.
Big companies that have leave policies, no matter how generous, that call for automatic termination of employees who exhaust the specified period of available time off, are prime targets for EEOC class action suits. Many courts have upheld claims by employees that their former employers violated their rights under the Americans with Disabilities Act by refusing to even consider extending their leaves of absence or providing other forms of reasonable accommodation. Employers should examine their long-term and short-term disability and medical leave policies to ensure that they comply with the ADA’s mandate that employers attempt, on an individualized basis, to accommodate employees’ disabilities before terminating their employment.
With the exception of a handful of municipalities, caregivers are not protected as a class. Under current law, caregivers may be able to assert claims under three different statutes, each limited in their reach:
1) Title VII sex discrimination: female caregivers of young children may be able to assert sex discrimination claims where they are treated differently then male employees based on a bias or assumption about the woman’s caregiving responsibilities;
2) FMLA Interference/Retaliation: if the employer has more than 50 employees and the employee meets other criteria for coverage under FMLA, the employee may have an interference or retaliation claim under FMLA;
3) Association Provision of ADA: the employee cannot be discriminated against because of the disability of an individual with whom the worker has a relationship or association.
Claims under these statutes are limited. First, to present a sex discrimination claim, the plaintiff (usually a woman) has to present a very specific set of facts reflecting that she was treated differently based on assumption about her role as a caregiver/parent. FMLA has limited application, including employers with 50 or more employees, and a plaintiff who has been employed for more than 12 months, among other restrictions.
ADA associational claims have never really caught hold and there have been very few cases brought under this theory, even fewer brought successfully. Moreover, in order to bring an ADA associational claim, the plaintiff must first show that the loved one has an impairment, or is perceived as having an impairment, and that it meets the definition of “disability.”
Given the limitations of existing causes of action, GINA provides an important additional layer of protection for caregivers and gives employers another reason to be aware of the laws that expose them to potential liability.
The Genetic Information Nondiscrimination Act (GINA), went into effect in November 2009. Title II of the Act, which applies to employers, amends Title VII to prohibit employment discrimination on the basis of genetic information. GINA was intended to address a very specific concern--specifically, that the advancement of genetic science would lead to employment (and insurance) discrimination based on an individual’s potential to contract a certain disease as reflected in genetic markers. But GINA's language has a far broader reach, which may well become the newest and most useful weapon in the work-family arsenal.
GINA’s Bite May Be Bigger than Its Bark
GINA has been ballyhooed by many as a “solution in search of a problem” in light of the fact that similar state laws have existed for years without generating a single case. Adding to the downplaying of the new law is the absence of evidence that employers in large numbers are seeking genetic information from their employees. The process is, after all, an expensive one and one that generates incremental predictive value.
Few would dispute the presumption that employers are not, as a whole, investing the time and money to root out genetic information on their employees or applicants—information that may or may not have real value to predict the individual’s health in the future. The more realistic concern, however, is what employers do with such information when they have it. Under the statute, even “inadvertently acquired” information cannot be used in any employment decision.
Despite the general consensus among employment-law practitioners that GINA presents little in the way of new potential exposure, this may be a gross underestimate of the real risk that GINA presents.
The key to GINA’s applicability to work-family and caregiver scenarios is its definition of “genetic information,” which includes “the genetic tests of family members [of the employee]” and “the manifestation of a disease or disorder in family members [of the employee].” “Family member,” in turn, is defined as “a dependent as used for purposes of ERISA,” and up to a fourth-degree relative (i.e., great-great grandparents and all cousins, aunts, and uncles inbetween). Notably, the scope includes adoptive children and parents, whose genes are entirely unrelated to the employees’. It is also notable that the “manifestation of a disease or disorder in family members” is not limited to those diseases with genetic markers.
Hazard #1: Genetic Tests of Family Members
First, let’s talk about genetic tests of family members. There are currently more than 500 diseases with known genetic markers, including Huntington’s, Alzheimer’s, and Parkinson’s—and the number is growing all the time. In some cases, a genetic test revealing the marker for the disease means the individual is certain to contract the disease, and in others, it indicates only some statistical probability of contracting the disease.
While this potential is frightening enough, for employees with family members already manifesting a disease, the consequences and implications are present and real. Many fear, and perhaps rightfully so, that an employer would have several concerns related to such an employee, including (1) the cost to the employer if family member is covered on health plan; (2) the employee will be less productive because of caring for a loved one with a disease; or lastly, (3) that the employee will develop the disease. While it appears that it is only the third issue that Congress was attempting to address with GINA, the Act’s reach expands to the other areas as well.
In Part II of this post, I'll discuss how GINA applies in the caregiver context and, in Part III, I'll explain how GINA's prohibitions may cause problems for employers who search online for employee data. Stay tuned. . .
Less than one-third of U.S. employers have a social-media policy, according to Manpower in its recent study, Social Networks vs. Management? Harness the Power of Social Media. Not that this is a surprise. Frankly, I’m more surprised when an employer actually does have a social-media policy in place. The recently published regulations of the FTC regarding employee endorsements and social-media sites may prompt some employers to get working on that policy. And, if that’s the case or if you’re considering a social-media policy for any other reason, here are some tips to help you on your way.
Before You Draft
There are three steps that must be completed before you can get to the heart of it and start to collaborate on the actual content of your policy. I’ve written about these steps before, so I’ll just touch on them here.
First, you have to educate the decision makers about what social media is all about. Likely, this means you’ll need to get at least some of the C-Suite to participate in social media to some degree. A lot of hand-holding is both appropriate and effective. Don’t expect executives to squeeze time into their already crammed schedules to learn about social media just for the heck of it. Work with them by doing the legwork for them. Collect relevant blog posts and send them to the decision maker once a week. Or monitor Twitter for mentions of the company’s name and provide those as part of your regular update. Anything to show them that social media is relevant.
Before putting pen to paper, employers should start with the 3 most important questions: Who, What, and Why. I’ve discussed these in more detail in an earlier post (See Social Media Is Here to Stay: Time to start that social-media policy). Generally, these questions address the following:
First, who will be regulated by the policy—i.e., will certain job titles or departments be excluded altogether or subject to less restrictions?
Second, what will be regulated—will all online activity be subject to the policy or only when the employee somehow associates himself with your organization (for example, by using his company e-mail account in his Twitter profile).
Third, why are you writing a policy in the first place? Is it to encourage employees to get out there and embrace social media, hopefully with some resulting benefits returning to the employer? Or are you trying to regulate online use of social-networking sites because productivity has become an issue? There are infinite variations of those two choices and your organization needs to settle on one before you start hashing out actual policy provisions.
Keep Confidential Information Confidential. Company information should not be shared outside the company. Similarly, any activities that occur at the Company’s facilities should not be shared outside the company. Do not post pictures of Company events or of the interior of the Company’s facilities without express authorization. Do not share any information about clients or customers and do not identify any clients or customers by name or otherwise.
Be Nice. Do not post derogatory, defamatory, or inflammatory content about others for any reason. Disagreeing with another person’s opinions or actions is a legitimate form of expression. But express your disagreement in an intellectual and rational way supported by facts and references and free of any overt or underlying nastiness or hostility. Stay calm even if others post information about you or the Company that is untrue.
Do Not Break the Law. Do not engage in illegal or unlawful activities—at work or at any time. Do not publish pictures or other information about your participation in illegal activities. Similarly, do not publish anything that infers or implies that you are engaging in illegal conduct.
Protect Privacy Rights (of Yourself and of Others). Be very cautious about the ways in which you share personal or private information about yourself with others online. Assume that your coworkers and clients wish to maintain their privacy, as well. Do not post pictures of coworkers without their express permission. Do not share details of others’ personal lives online unless they’ve expressly authorized you to do so. Assume that anything and everything you post online will stay online forever, for anyone to see. If that makes you think twice about posting the information, then don’t.
Standards of Conduct Still Apply. Any conduct that would be grounds for dismissal if performed at work will be grounds for dismissal if performed online. Just as the Company does not tolerate use of race-, religion-, or gender-based slurs in the workplace, an employee’s use of such slurs in cyberspace will be grounds for immediate termination. Similarly, just as workplace harassment will not be tolerated, harassing behavior that is conducted online will not be tolerated. Threats of violence towards others, like hate-based language and harassment, is grounds for termination.
See these earlier posts for more help with your social-media policy:
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President Obama’s Chief of Staff has caused quite a stir. Reportedly, in a fit of frustration, Rahm Emanuel called participants in a White House meeting “ f---ing retarded.” Sarah Palin, who has a son with Down’s Syndrome, quickly spoke out about the inappropriate nature of the comment on Facebook. The statement drew additional attention because this is the second time that a member of the Obama Administration has had to apologize for making an insensitive comment regarding the mentally disabled.
Emanuel apologized for the comment to Tim Shriver, who heads the Special Olympics. The organization has launched a campaign urging people to stop using the term "retarded" as an insult, "Spread the word to end the word."
There is a valuable lesson to be learned from Rahm Emanuel’s comments. Political correctness for its own sake can make personal interactions unnecessarily burdensome. Instead of trying to be politically correct, try to be kind. A little sensitivity and forethought can help to avoid embarrassing foot-in-mouth moments.
President Obama’s administration will seek more funding for the U.S. Department of Labor (DOL), including more funds to enforce wage and hour laws and pursue employers who misclassify employees as independent contractors. In a press release yesterday, Secretary of Labor Hilda L. Solis outlined the president's fiscal year (FY) 2011 budget request for the DOL, which is built around the vision of "good jobs for everyone."
The FY 2011 budget requests $117 billion, with the majority to be used for unemployment insurance benefits for displaced workers and federal workers' compensation. The DOL's discretionary request of $14.0 billion overall includes $1.7 billion for worker protection programs, a four percent increase over the prior year's budget.
According to Secretary Solis, “[t]he FY 2011 budget will help to make the vision of good jobs for everyone a reality for America's workers. This budget invests in innovation and reform that will play a critically important role in building long-term economic security for workers. At the same time, the budget reflects our commitment to fiscal responsibility, investing in what works and carefully evaluating our programs to make sure that we obtain results that produce good jobs."
The DOL seeks to hire more than 350 new employees, including 177 investigators and other enforcement staff, many of whom will be bilingual to better communicate with employees. The 2011 budget builds on the 2010 budget policy of returning worker protection programs to FY 2001 staffing levels, after years of decline. The Wage and Hour Division of the DOL will receive $244 million, an increase of almost $20 million from the prior year, including funding to hire 90 new investigators.
One particular area that will be the target of enforcement is the use of independent contractors by employers. When workers are misclassified as "independent contractors," they are deprived of benefits and protections to which they are legally entitled,” said the DOL. For example, independent contractors do not receive overtime and are ineligible to receive unemployment benefits. The FY 2011 budget includes an additional $25 million for a Misclassification Initiative to target misclassification with 100 additional enforcement personnel and competitive grants to boost states' incentives and capacity to address this problem. (This $25 million includes the nearly $20 million increase for the Wage and Hour Division discussed above.)
Independent contractors, by definition, are self-employed and because they are not “employees” are not covered by employment, labor, and various tax withholding laws. In some instances employers reclassify employees as independent contractors in order to avoid taxes, payment of overtime and benefits, and workers’ compensation liability. However, whether or not a worker is covered by a particular employment, labor, or tax law hinges on the definition of an “employee.”
The IRS uses a 20-factor, right-to-control test to assess an employers’ tax liability. The DOL often relies on the so-called “economic realities test” or a hybrid of the right-to-control and economic realities test to determine independent contractor status. Some believe the economic realities test makes it harder to classify an employee as an independent contractor, since, in addition to considering the degree of control the employer exercises, it takes into account the degree to which the workers are economically dependent on the business.
The DOL’s efforts to crack down on the use of independent contractors is just the latest in a series of federal initiatives and state laws that have made this issue come under increasing scrutiny. For instance, in December 2009 legislation was introduced in the U.S. Senate that would make it more difficult for employers to classify workers as independent contractors for employment tax purposes. In October of last year, Maryland passed the Workplace Fraud Act, which made it a violation of law to fail to properly classify workers as employees and imposed penalties on those employers who knowingly misclassify their workers.
In July 2009, Delaware passed its own law imposing stiff penalties on construction industry employers who improperly classify employees as independent contractors to save on business costs and avoid paying appropriate taxes.
This year, Adria B. Martinelli and I will be speaking at the Advanced Employment Issues Symposium in Las Vegas, Nevada, on November 11-12. (If you can't join us in Vegas in November, maybe you can swing a trip to Nashville, Tennessee, where the Advanced Employment Issues Symposium will be presented on September 30-October 1.)
The Advanced Employment Issues Symposium is in it's 15th year and is recognized as one of the leading employment-law conferences for forward-thinking human resource professionals, executives, and in-house counsel. This year, there are three featured tracks: Employment Law Enforcement; FMLA & ADA; and Talent Management.
Registration for the Employment Issues Symposium is open now, with early-registration discounts until March 31. If you aren't able to attend either of this year's programs, you can order the materials from the registration website, as well.
Hope to see you then!