March 2013 Archives

Your Employees Are Stealing Your Data

Posted by Molly DiBiancaOn March 25, 2013In: Electronic Monitoring, Policies, Privacy In the Workplace

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Employee resigns. But before her last day of work, Employee copies thousands of emails and documents from Employer’s computer.  Off goes Employee into the sunset.

How often is this scenario?  I bet most employers think this never happens in their workplace. I’d be willing to bet that it happens in almost every workplace.  It happens with such regularity, yet most employers are absolutely stunned to discover that it’s happened to them. 3d thief cracks safe

If you think it doesn’t happen pretty much all of the time, check out this post at the uber-popular website, Lifehacker.com, titled, How Can I Save All My Work Emails for a Personal Backup?  A reader submitted the following question:

I'm leaving my job and want to take my work emails with me. I've been burned at jobs before, and it became very useful to have an email paper trail behind me. How can I save all the emails so I can access them in the future, just in case I need them?

The author of the piece responds back, providing detailed, step-by-step instructions for how to do exactly that—take with you each and every email you sent and/or received during the course of your employment.

Putting aside how terrible of an idea this is on Lifehacker’s part (can you say, “promoting or endorsing illegal activity?), let’s focus just on the reality—which is, clearly, that your employees are taking your stuff!

What remedies are available to the employer?  Well, most immediately, there’s the demand that the items be returned.  Lawyers have a particular flair when it comes to a well-crafted cease-and-desist letter, so consider having your employment counsel get involved from the outset.

But if the employee refuses to return the documents or ignores your demand, then what? One option is to sue.  A variety of claims may be applicable, depending on the precise nature of the documents and information and on what the employee has done with them since her departure.  For example, the employer may have claims like conversion (civil theft, generally speaking), misappropriation of trade secrets, tortious interference, etc. 

And, depending on where the employee worked, there also may be a claim under the state and/or federal computer-misuse statutes.  In Delaware, for example, we have computer-misuse statutes that provide for recovery of an award of treble damages and attorney’s fees.  And, because Delaware is in the Third Circuit, we have the Computer Fraud and Abuse Act. 

This statute has limited application in other states—including those within in the Fourth and Ninth Circuits, where the Courts of Appeals have rejected the application of the CFAA in the employee-traitor context.  Instead, in those states, the statute is construed as applying only to the true computer hacker. 

The CFAA is a fascinating statute with complex provisions.  The Florida Bar Journal has an excellent analysis of the law—and of the different interpretations of the various Courts of Appeals—for those who may be interested.

For the rest of you, though, now is the time to implement a confidentiality agreement if you don’t already have one in place and to consider just how certain you are about what employees can and cannot take at the end of employment.

See also

Judge's Porn Habit Results In Suspension

Computer Fraud and Abuse Act: Government to the Rescue of Employers?

Putting the Computer Fraud and Abuse Act to Work for Employers

Putting the CFAA to Use, TV Style

EEOC Faces Petition for $5.5m in Fees

Posted by Molly DiBiancaOn March 25, 2013In: EEOC Suits & Settlements

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Employers are wary of litigating against the EEOC. And for good reason. Many employers who have faced the EEOC in the courtroom have complained that the agency uses guerilla litigation tactics. One commonly heard complaint occurs in the context of class actions, when the EEOC refuses to disclose the identity of the claimants on behalf of whom the EEOC seeks relief.

Recently, though, some courts have heard these complaints and agreed with the employer. Different courts have reacted, differently, though. Only a few have gone so far as dismissing the EEOC’s case.

One of the first courts to take this course was the U.S. District Court in Iowa. In EEOC v. CRST Van Expedited, Inc., the EEOC filed suit on behalf of 270 female truck drivers, claiming that they were subject to a hostile work environment. The district court dismissed the claims of all but two employees. The company settled the remaining claim for $50,000.

The EEOC appealed but the 8th Circuit held that the EEOC’s failure to conduct a complete investigation and conciliation prevented it from representing certain claimants and affirmed the dismissal of the EEOC’s suit as to those employees.

With that significant victory under its belt, the employer has decided to see if it can keep its winning streak alive. On March 18, 2013, CRST filed a petition seeking $5.5 million in fees and expenses incurred in defending the EEOC’s suit. In support of its petition, the employer points to some troubling facts:

· 150 depositions were taken during the litigation;

· 115 of the 270 claimants were dismissed for failing to appear for deposition;

· 7 summary-judgment motions were filed;

· 88 claims were dismissed as meritless; and

· 67 claims were dismissed for the EEOC’s failure to conciliate.

These facts should be enough to scare any employer, although it remains to be seen whether they will be sufficient to warrant an award of fees. We’ll be sure to keep you posted.

See also

W.D. Pa. Finds EEOC Failed to Conciliate

What Does “Good Faith” Mean to the EEOC?

When the EEOC Goes Too Far—Part 2

When the EEOC Goes Too Far

EEOC v. Ruby Tuesday

2013 Annual Employment Law Seminar

Posted by Molly DiBiancaOn March 19, 2013In: Seminars, YCST

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Registration is now open for Young Conaway’s 2013 Annual Employment Law Seminar.  This year’s event will be held on May 9 at the Chase Center on the Riverfront.  We are looking forward to it and hope to see you there!

Slide1

The details about the day-long program and online registration can be found at the event’s webpage here.

Promissory Estoppel Is Alive and Well In Delaware Employment Law

Posted by Sheldon N. SandlerOn March 17, 2013In: Cases of Note, Delaware Specific

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In a reminder to Delaware employers that what you say can come back to bite you, the Delaware Supreme Court reinstated a Superior Court jury verdict in favor of a plaintiff, after the trial court had determined that his claim failed as a matter of law. The plaintiff, Donald Harmon, had been the Presiding Judge of the Delaware Harness Racing Commission, and was fired as a result of an allegation that he had changed a judging sheet for a race, as a favor to the horse's owner. Harmon was charged with crimes and was suspended without pay pending the outcome of the criminal case.

He asked another employee to find out from the Racing Commission whether he would be reinstated if he was acquitted on the criminal charges. The employee testified that he put that question to the Commissioners and they "looked at each other and then said [Harmon] would be reinstated." The Commission later decided not to reinstate Harmon and he sued, obtaining an award of $102,273 after a 5 day jury trial. The trial court overturned the verdict and Harmon appealed to the Delaware Supreme Court.

In essence, promissory estoppel in the employment context means that the employer has made a representation to an employee that the employee reasonably relied on to his or her detriment. While that theory can apply to private employers, the general rule in the public sector, as asserted by the Racing Commission in this case, is that "the state is not estopped in the exercise of its governmental functions by the acts of its officers."

Relying on two rather hoary school-district cases, the Delaware Supreme Court recognized that there is "an exception to the general rule in the employment context." In, Keating v. Bd. of Educ. of the Appoquinimink Sch. Dist., and Crisco v. Bd. of Educ. of the Indian River Sch. Dist., the court rejected the claim that promissory estoppel does not apply to a "creature of the State."

The Takeaway

What is striking about all three cases is the casual manner in which the employers' representatives acted. If a clear, written statement had existed in Keating that it was only the decision of the Board that determined who would be rehired, and in Crisco that persons with standard certificates would have preference under the RIF policy, and if the Racing Commission had, instead of "looking at each other," made it clear that it was not committing to rehiring Harmon without a more formal investigation, the outcome almost surely would have been different.

Harmon v. State of Delaware, (PDF), No 676, 2011 (Del. Feb. 15, 2013).

EEOC Sanctioned for Failure to Produce Social-Media Evidence

Posted by Molly DiBiancaOn March 8, 2013In: EEOC Suits & Settlements, Social Media in the Workplace

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EEOC v. Original Honeybaked Ham Co. of Georgia, Inc., is the subject of today’s post. I first wrote about this case in November, when the Colorado District Court granted a motion to compel the EEOC to turn over social-media content of claimant-employees. The court acknowledged that discovery of social-media content presents “thorny and novel issues.” But, finding that the postings were relevant to the issues in the case, the court ordered that it be turned over.EEOC

In an unusual twist, the court required the EEOC to turn over the log-in information and passwords of the claimants to a special master, who would make an initial determination of discoverability. I concluded that the decision was a well-reasoned attempt to balance the individual claimants' privacy interests with the defendant-employer's right to broad discovery of potentially relevant information. Faced with these two competing interests, the court crafted a fairly complex, multi-tiered, and dynamic process for the collection, review, and production of the information from the employees' social-media accounts.

Fast-forward three months.

The employer files a motion for sanctions, alleging that the EEOC had failed to comply with the court’s order to produce the social-media data. The court granted the motion, finding that the EEOC had, in several material respects, made the discovery of claimants’ social media “more time consuming, laborious, and adversarial than it should have been.” In short, the court found that the EEOC had agreed to various discovery procedures only to later renege when the “higher-ups” at the EEOC learned about the parties’ agreement and didn’t, well, . . . agree.

In awarding the employer its reasonable attorney’s fees, the court had to use some judicial imagination, finding first that most of the sanctions rules did not apply because the EEOC had not litigated in bad faith. Instead, the discovery problems were more a result of bureaucracy, rather than intentional bad-faith tactics. Still, the court did find a rule that enabled it to award fees and, with any luck, send a strong message to the EEOC about the consequences of failing to cooperate (and keep its promises) during discovery.

No. 11-02560-MSK-MEH (D. Colo. Feb. 27, 2013).

Employees Must Turn Over Facebook Info For Harassment Claim

Discovery of EEOC Claimants' Social-Media Posts

W.D. Pa. Finds EEOC Failed to Conciliate

What Does “Good Faith” Mean to the EEOC?

When the EEOC Goes Too Far—Part 2

When the EEOC Goes Too Far

EEOC v. Ruby Tuesday

Call Me, Maybe. Discovery of Employee Identities

2d Cir: FLSA Does Not Cover Gap Time

Posted by Molly DiBiancaOn March 6, 2013In: Fair Labor Standards Act (FLSA)

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Auto-deduct policies and meal breaks continue to make FLSA headlines. Last week, the Second Circuit tackled these policies, as well as gap-time claims, head on and came down on the side of the employer.

The case involved a collective action brought by employees of various health-care facilities. The basic allegation was that the plaintiff-employees had not been paid for time worked during meal breaks, before and after shifts, and time spent at training. The plaintiffs brought claims under the federal FLSA and under the New York state wage law. The district court dismissed the complaint several times before the case made it to the 2d Circuit.

The plaintiffs brought two types of claims under the FLSA: (1) overtime; and (2) gap time. Both were dismissed by the trial court. The Second Circuit affirmed the dismissal.

Overtime

The court concluded that, "in order to state a plausible FLSA overtime claim, a plaintiff must sufficiently allege 40 hours of work in a given workweek as well as some uncompensated time in excess of the 40 hours." Here, the plaintiffs didn't make any factual allegations about how much time they claimed to have worked but not been paid. Similarly, they did not allege whether this missed time (in whatever amount that may be), bumped them into a more-than-40-hour workweek.

As so aptly stated by the court, the plaintiffs' vague allegations "supply nothing but low-octane fuel for speculation, not the plausible claim that is required." Based on the failure to allege any specific facts about the time worked, the dismissal of the claim was affirmed.

Gap Time

We've posted about gap time previously. In this case, the Second Circuit described a gap-time claim as "one in which an employee has not worked 40 hours in a given week but seeks recovery of unpaid time worked, or in which an employee has worked over 40 hours in a given week but seeks recovery for unpaid work under 40 hours."

The court, consistent with the majority of courts to have reached the question, explicitly rejected a gap-time claim brought under the FLSA. As the court explained, there is "no claim under FLSA for hours worked below the 40-hour overtime threshold, unless the average hourly wage falls below the federal minimum wage."

And, in a question of first impression, the court held that the FLSA does not provide for a gap-time claim even when an employee has worked overtime. The court explained:

The agreement to work certain additional hours for nothing was in essence an agreement to accept a reduction in pay. So long as reduced rate still exceeds the minimum wage, an agreement to accept reduced pay is valid.

So long as an employee is being paid the minimum wage or more, the FLSA does not provide recourse for unpaid hours below the 40-hour threshold, even if the employee also works overtime hours the same week. This is an important and timely victory for employers in their continued defense against FLSA lawsuits.

(PDF)

Another Employer's Auto-Deduct Policy Is Upheld (Creeley v. HCR ManorCare, Inc., (N.D. Ohio Jan. 31, 2013)).

6th Cir. Affirms Dismissal of FLSA Gotcha Litigation (White v. Baptist Mem'l Health Care Corp. (6th Cir. Nov. 6, 2012)).

The Legality of Automatically Deducting Meal Breaks (Camilotes v. Resurrection Health Care Corp. (N.D. Ill. Oct. 4, 2012)).

E.D. Pa. Dismisses Nurses' Claims for Missed Meal Breaks, Part I and Part II (Lynn v. Jefferson Health Sys., Inc. (E.D. Pa. Aug. 8, 2012)).

FLSA Victory: Class Certification Denied (Pennington v. Integrity Commun, LLC (E.D. Mo. Oct. 11, 2012))

Penn Admissions Officer Too Funny for Facebook

Posted by Molly DiBiancaOn March 4, 2013In: Social Media in the Workplace

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Teachers and Facebook can be a dangerous combination. I’ve written numerous posts about the impact of social media on today’s public schools. But the woes of social networking aren’t limited to educators in grades K-12. Just ask administrators at the University of Pennsylvania.

The prestigious university is dealing with an incident of bad form by an admissions officer. According to Inside Higher Ed, the Nadirah Farah Foley, posted excerpts from application essays on her Facebook page, accompanied by her own snarky commentary. Facebook for Educators

I think many of us would agree that there is a tremendous amount of comedic potential with college-application essays . . . for comedians. But probably not for the admissions officers charged with deciding the applicants’ future. Although Foley’s Facebook friends didn’t seem to mind. In fact, they thought her commentary was so entertaining, they encouraged her to post more snarkiness.

Ironically, Foley declined. She would, she said, “if it weren’t such a professional risk/liability.” Ah, yes. How wise she was. Too bad she hadn’t thought of that before posting the comments.

The story has a predictable ending. One of Foley’s Facebook “friends” sent screen shots of the posts anonymously to the University’s independent student newspaper. Foley is “no longer affiliated with the institution,” according to Inside Higher Ed, but school officials have been mum about the conditions of her departure.

Not surprisingly, the school does not have a social-media policy for its admissions officers.

Teacher’s Facebook Firing Upheld by N.J. Appellate Court

Social-Media Woes for School Districts

More Social-Media Woes for School Districts

The State of the Social-Media Mess in Public Schools

Students, Teachers, and Social Media

No 1st Am. Protection for Teacher's Facebook Posts

Court Denies Reinstatement to Teacher Fired for Facebook Posts

N.Y. Teacher's Firing Overturned Despite Facebook Wish that Students Drown

Blogging Teacher Returns to Work After Suspension for Posting About Students