June 2010 Archives

Still No GINA Regs, But New Website on the Basics

Posted by Adria B. MartinelliOn June 25, 2010In: Genetic Information (GINA), Resources

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Employers and human-resource professionals have been anxiously awaiting the issuance of the final rules interpreting Title II of the Genetic Information Nondiscrimination Act (GINA). We remain hopeful the regulations will address some thorny issues, such as the implications of employers’ use of internet and social media sites, which may in turn reveal the genetic information of an employee or applicant.

Looks like we shouldn’t hold our collective breaths for the final answer. Deadline after deadline set by the EEOC for its publication of the regulations for Title II of the Act, which applies to employers, has come and gone. Most recently, the EEOC’s Spring 2010 Agency Rule List indicated that GINA regulations were in the Final Rule stage and were expected to be finalized in May. May has come and gone and still no regulations.

In the meantime in GINA news, a new website, http://www.ginahelp.org/ has been created by the Genetic Alliance, the Genetics and Public Policy Center at the Johns Hopkins University, and the National Coalition for Health Professional Education in Genetics through funding by The Pew Charitable Trusts. This online resource on the GINA and its protections in health insurance and employment includes answers to common questions about GINA and hypothetical examples.

The information is fairly basic, but could serve as a helpful resource for those trying to get quickly up to speed on the fundamentals of GINA.

It's Unanimous: Supreme Court Permits Search of Employees' Electronic Communications

Posted by Molly DiBiancaOn June 18, 2010In: Privacy In the Workplace

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In Quon v. City of Ontario, the 9th Circuit held that a California police department’s review of an officer’s text messages was an invasion of the officer’s right to privacy. In a unanimous ruling issued yesterday, the U.S. Supreme Court overturned the Quon decision and ruled that the police department’s review of the provocative text messages sent by the officer to his wife and to his mistress from his employer-issued pager, did not constitute an invasion of the officer’s privacy. (Link to the full opinion in City of Ontario v. Quon).

For employers, the key component of the decision is the Court’s focus on the fact that the police department-employer’s review of the messages comported with its policy and was conducted for a legitimate business reason. The department’s policy provided that messages would not be reviewed unless the employee went over the allotted monthly usage. In Quon, the officer had exceeded the monthly limit and the department reviewed the messages to determine whether the overages were work-related. Officers were responsible for costs incurred for non-work-related messages if they went over the monthly limit.

The 9th Circuit ruled that this review constituted an unreasonable search and seizure in violation of the Fourth Amendment. That decision was based largely on the fact that the officer’s supervisor had told the officer that messages were never reviewed by the department. The federal appellate court found that, because he’d been permitted to use the pager for both personal and work-related use, the officer had a reasonable expectation of privacy in those communications.

This important decision is the Supreme Court’s first in the area of an employer’s right to monitor the electronic communications of its employees sent and received during working time or with work-issued devices.

The decision was not a free-for-all pass for employers who want to review employees' electronic messages. The Supreme Court warned employers of the possibility that an expectation of privacy may exist in certain circumstances. Interestingly, the Court noted that the expectation of privacy may exist due to to the pervasiveness of electronic communications. Justice Kennedy, writing for the Court, explained that “cellphone and text message communications are so pervasive that some persons may consider them to be essential means or necessary instruments for self-expression, even self-identification.”

But the Court also recognized that the pervasiveness of cellphones and other electronic-communication devices, has also driven down the cost of such devices, making them “generally affordable.” The low cost of electronic-communication devices, the Court found, supports the argument that there is a very low or no expectation of privacy because an employee who needs a cellphone for personal use can buy one and avoid having to use the work-issued device for anything other than work-related communications.

The decision is a critical one for employers who want to ensure employee compliance with company rules and policies without violating the employee’s privacy rights and, in turn, exposing the organization to legal liability. The Quon opinion has two key components for employers:

1. Any workplace monitoring must comply with the employer’s policy—if you don’t have a clear policy, now is the time to get one; and

2. A search of electronic communications should not go beyond what is necessary to accomplish the legitimate business purpose behind the policy—use the least intrusive means possible to make the determination at issue.

U.S. Supreme Court Invalidates 600 NLRB Decisions

Posted by Sheldon N. SandlerOn June 17, 2010In: Union and Labor Issues

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Labor-law attorneys had quite a day. The U.S. Supreme Court, in an unexpected decision announced today, has held that the two members of the 5-person National Labor Relations Board (NLRB), who remained after the other members’ terms expired and Congress failed to act on proposed new members did not have the statutory authority to issue rulings. As a result, nearly 600 cases have been voided. The four strict constructionists on the Court were joined by departing Justice John Paul Stevens, who wrote the opinion. Justice Anthony Kennedy, usually a swing vote, wrote a dissenting opinion joined by the liberal wing of the Court. The decision is New Process Steel v. National Labor Relations Board (08-1457).

The case hinged on language in the NLRA stating that “three members of the Board shall, at all times, constitute a quorum of the Board.” Once the Board was reduced to three members, before the third member’s term expired, the three delegated authority to act to the remaining two persons. The Supreme Court majority concluded that the three member quorum requirement had to be maintained “at all times,” while the dissent asserted that the three members needed to be in existence only at the time they delegated authority to the remaining two.

The practical effect of the decision may be minimal, since the two NLRB members who issued the decisions, current Chairperson Wilma Liebman and former Chairperson Peter Schaumber, a Democrat former union lawyer and a Republican former management lawyer respectively, had to agree in each case, so the decisions were, likely, noncontroversial philosophically.

BP Oil Spill Demonstrates Why Litigation Hold Instructions Are Invaluable

Posted by Maribeth L. MinellaOn June 16, 2010In: Newsworthy

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Anyone who works with me knows that I place a lot of emphasis on litigation hold letters. In the most general sense, litigation hold instructions are invaluable because they cause everyone involved to pause and think about what they are doing with relevant information. The primary purpose of litigation hold instructions is to make sure that evidence, whether it be a hard-copy document or an e-mail, is preserved. Litigation hold instructions can be used defensively (e.g., sending hold instructions to your team after a you have been altered to a potential for litigation) or offensively (e.g., sending instructions to your opponent to make sure that they dred life preserver rafto not despoil any evidence).

It will be interesting to see how the significance of litigation hold instructions evolves in BP Oil Spill litigation, particularly if reports about BP’s alleged knowledge of potential safety issues are true. On June 8, 2010 Newsweek reported that documents about BP’s internal safety investigations, leaked to ProPublica, show an alleged pattern of negligence and a culture which purportedly silenced whistleblowers. If these allegations are true, it is arguable that BP had a duty to preserve evidence when it first learned of any potential problems with Deep Horizon, and long before the April 20, 2010 explosion. Thus, even before any court opines on whether BP issued proper litigation hold instructions, there is an important lesson to be remembered by all employers – your preservation duties kick in before a complaint is filed.

Electronic discovery experts already predict that litigation associated with the BP Oil Spill will become the largest electronic discovery event in history, and I agree. The sheer volume of electronically stored information, combined with accusations of negligence, the extensive damage suffered by the Gulf Coast region, and the fact that the explosion on the Deep Horizon killed eleven people, has created the perfect e-discovery storm. No matter the circumstances, however, the lesson remains the same. Consider your litigation hold duties early and often, and before a complaint is filed.

Are You Monitoring Your Employees’ Facebook Pages?

Posted by Molly DiBiancaOn June 15, 2010In: Social Media in the Workplace

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Social-media searches by employers are all the rage when hiring new employees.  Every time talk about social media, inevitably the discussion turns to the question, "Can I check a candidate's Facebook page?"  Last week, at my presentation to Delaware SHRM, this was the main topic of conversation--how to lawfully and ethically incorporate social-media searches in your background checks without setting your organization up for lawsuits and liability.

I offer a "solution" to the problem of potential legal risk with a multi-step plan to avoid the pitfalls that could otherwise arise.  One of the steps in this plan is to notify candidates of the possibility that you will be monitoring their online activity, including any social-networking profiles, such as Facebook, LinkedIn, or MySpace pages.  It's easy to give the notice--the addition of a single sentence in your standard background-check notice will do the trick.  A second step is to get consent.  Again, a simple step because you're already having the candidates sign off on the background-check form. 

After my presentation to Delaware SHRM last week, the program coordinator said that quite a few of the participants asked her after the session whether they could "ask" (read, "require") current employees to give the same type of consent.  Well, the answer is "yes and no."  (You didn't think I was going to give a simple yes-or-no answer, did you?)

The "no" part of the answer comes from the argument that consent can't truly be given if the "request" is actually a demand.  The "yes" part of the answer comes from the argument that there'd be no legal liability, so what's to stop you? 

Ok, so both arguments are only half right, but here's the full truth of it.  You don't really stand to gain anything from "requiring consent."  You don't need consent to search what is public information--regardless of the sometimes distorted definition of "public" as many employees understand it. But, at the same time, there's quite a bit to gained from being honest and transparent with your employees.

Instead of consent, consider disclosure.  Explain to employees: (1) what interests of the organization you are trying to protect (i.e., confidentiality, anti-harassment, regulatory compliance, etc.); (2) which online activities the organization believes pose the most risk to its interests (i.e., discriminatory statements, posting pictures taken inside the workplace, etc.); and (3) the lengths and limits of the monitoring efforts the organization believes will prevent these risks. 

See also these posts relating to social media in the workplace:

Employee Fired When Her Sex Blog Is Discovered by Her Boss

Why the Philadelphia Eagles (Still) Need a Social-Media Policy

Eagles Employee Gets Benched for Comment on Facebook Page

Judge Shows Why Employers Should Consider Prohibiting Employees From Posting Anonymously Online

Breach of Noncompetition Agreement Via LinkedIn

Sure, You Can Use Facebook at Work . . . We'll Just Monitor What You Post

Sample Social-Media Policy

5 Non-Negotiable Provisions for Your Social-Media Policy



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Top Small Company Workplaces 2010

Posted by Molly DiBiancaOn June 8, 2010In: Employee Engagement

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Some small businesses have managed to come out on top--despite the difficult economy. In this month's edition of Inc. Magazine 20 small businesses are celebrated as the Top Small Company Workplaces.  The winners and 20 finalists are selected by Winning Workplaces and are recognized for achieving business success through exemplary people practices and outstanding workplace cultures.image

Winning Workplaces reports some of the highlights of the 2010 award winners:

  • 100% of winners profitable in 2009
  • 90% of finalists profitable in 2009
  • 36% average revenue growth, 2007-09
  • Ability to weather bad times with the good: average of 28 years in business
  • High average employee tenure of 7 years
  • Low average turnover of 8% across 18 diverse industries

More information on the winners and finalists of this award is available at the following links:

June 8: Delaware SHRM Breakfast Meeting (Social Media)

Posted by Molly DiBiancaOn June 4, 2010In: Seminars, Past

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Join Molly DiBianca and Delaware SHRM at 7:30 am on June 8th for an interactive discussion of social media for hiring.  We'll discuss:

  • the impact of social media sites on recruiters and hiring managers;
  • how social media is changing the nature of recruiting; and
  • legal liability and exposure of using social media.

The impact of social media sites like Twitter, Facebook and LinkedIn is undeniable but, also, undefined. Hundreds of millions of Americans now use these sites and others like them for an expanding number of reasons. And it's not just the country's youth online, either. Twitter users are more likely to be Baby Boomers than they are to be youngsters in the 12-to-24 crowd.

So it's no surprise that social media is causing tremendous changes in the way employers recruit and hire new employees. Employers have to look beyond standard recruiting tactics if they hope to secure the most sought-after candidates. But the adventure into the social-media sphere is not without risks. Before you send a friend request to that job applicant, be sure you know how it could expose your organization to legal liability.

Whether you're a master of your Facebook page, or you're still wondering what a "tweet" really is, Molly DiBianca will guide you in the right direction when it comes to social media.

The session will be held at the Christiana Hilton in Newark, DelawareRegistration is $40 for members and $45 for non-members.

June 9: Unfair Competition Webinar

Posted by Molly DiBiancaOn June 4, 2010In: Seminars, Past

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The Employment Law Alliance is holding a webinar that will address the use of noncompete agreements in various jurisdictions, including Delaware. The panel of speakers includes attorneys from the U.S. and Canada, including our own Barry M. Willoughby.  The webinar will be held on June 9, 2010, 3-4:30 p.m. EDT.

In addition addressing the treatment of noncompete agreements, panelists will offer practical and concrete strategies on:

  • Drafting and enforcing restrictions on employee competition when doing business in multiple jurisdictions at one time
  • How the "duty of loyalty" can be used to stop employees from setting up competing businesses while still employed by you.
  • What employers can do to minimize the risk that your employees will walk out the door with your trade secrets
  • How to stop competitors from engaging in unfair competition.

Registration is free:  Your Top Talent Walks Out the Door: Now What? How to Stop Your Competitors from Raiding Your Workforce and Engaging in Unfair Competition in the U.S. and Canada

What Employers Can Learn from the Novartis Lawsuit

Posted by Adria B. MartinelliOn June 3, 2010In: Cases of Note, Gender (Title VII)

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Pharmaceutical giant Novartis recently defended a class action lawsuit filed by thousands of its female sales representatives alleging discriminatory treatment in pay and promotions. It was the largest gender discrimination case ever to reach a jury verdict.  green chalkboard and stacked books

Novartis might need to stock up on their in-house supply of Diovan – their top-selling drug, which treats hypertension -- as there are surely some Novartis executives with elevated blood pressure following the recent verdict. The jury awarded $250 million in punitive damages, $3.37 million in compensatory damages for the 12 named plaintiffs, with compensatory damages for the remaining members of the class to be determined separately. Experts estimate that Novartis could pay as much as $1 billion when all is said and done, and that doesn’t include legal fees expended to defend the mega-lawsuit.

Given the staggering nature of this award, an increase in employment class action lawsuits is almost certain. Class action suits are far more lucrative for plaintiff’s lawyers to take on, than a single employment discrimination lawsuit where damages rarely exceed a few hundred thousand dollars. In light of this new era which is sure to dawn : it is essential that employers examine their practices and consider their potential exposure in this area now.

Prevention is the Best Medicine

Audit pay classifications and EEO numbers.

Review your pay structure. Particularly in light of the Lily Ledbetter Act, which opens up exposure for employers potentially dating decades back, employers must be confident that their compensation structure does not reflect any trends that could be construed as discriminatory. Also, review your EEO numbers – this is one of the first things defense attorneys will do when their client is hit with a class action. Be aware, though, that if you run the numbers and they don’t look good, you’ve got to be willing to take action. Failing to take corrective action after a self-analysis could make the problem worse.

Outreach/Diversity in minority communities.

Fostering diversity programs within the workplace are good business and help to create a good corporate image while recruiting minority applicants. Because the recruiting/hiring process can be ripe ground for class action lawsuits, outreach is an important preventative step.

Hold managers accountable.

Make sure managers whose statements or actions result in company liability are held accountable. Where managers are appropriately trained, and take inappropriate actions nevertheless, one approach is to have litigation costs taken from the bottom line of the division for which the manager is responsible.

Have an internal EEO reporting procedure and train all employees.

Make sure you have an internal reporting procedure for any employee who has an EEO complaint, and that all employees understand that procedure. Handling any such complaints appropriately and with due diligence often can effectively head off future litigation.

Be Afraid – Be Very Afraid

The proactive steps outlined above will go a long way towards preventing a discrimination lawsuit, whether individual or class action. But sometimes even the most diligent of employers cannot avoid lawsuits. In light of the massive award in Novartis, class actions discrimination suits are sure to become more common. What signs should you look for to indicate you may be headed for a class action?

∙ For-Cause Findings by EEOC

Numerous charges with the same of similar allegations

∙ A pattern of irrelevant questions during management depositions

∙ Large numbers of employees asking for personnel files

∙ A significant increase in the number of internal complaints

If you observe any of these signs in your workplace, inform with your outside counsel immediately and brace for impact!

Bottom Line

No company is immune from a class-action lawsuit, and sometimes they are unavoidable. Nevertheless, taking the preventative steps and being attuned to the warning signs discussed above can significantly reduce a company’s risk of an employment class-action lawsuit.

Talk About Ego: Former Banker Says She Was Fired for Being Too Sexy

Posted by Molly DiBiancaOn June 3, 2010In: Gender (Title VII)

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Debrahlee Lorenzana has sued Citigroup, her former employer, alleging that she was unlawfully terminated because she was "too sexy for her job," to borrow a line from song by Right Said Fred. According to the New York Daily News, Lorenzana claims that she was subject to "improper comments" and reprimanded for dressing in a way that was "too distracting" to her male coworkers. She denies that she ever dressed inappropriately and complains that she's always been burdened with good looks--she draws attention from the opposite gender even when she's at the grocery store in sweatpants.

Oh, brother. Peacock

She is also quoted as saying that she refuses to "eat and gain 50 or 100 pounds because my job wants me to be the same size as everyone else."  Hmm.  I wonder if maybe she was fired for her inability to play well with others.  I mean, she sounds so charming, I can't imagine that all of the women in the office didn't adore her just as much as the men!

So what's the likelihood that her gender-discrimination claim actually has any merit?  Without having seen the complaint, I dare not even speculate.  On one hand, we've written previously about the increase of gender-discrimination suits brought by males and about how the courts seem to be expanding the protections of Title VII to include less traditional bases for such claims.  On the other hand, though, any perceived expansion has been in cases that evoke a great deal more sympathy than Ms. Beautiful's claims would likely evoke. 

It's one thing to have an individual who is tortured by co-workers for being too effeminate.  It seems that it would be altogether different to have an individual who has spent a lifetime fighting the heavy burden of being God's Gift to Men.  Maybe those of us not cursed with such beauty should just take a moment and count our lucky stars.