© 2011 McNees Wallace & Nurick LLC LABOR AND EMPLOYMENT LAW UPDATE: THE YEAR IN REVIEW Eric N....

© 2011 McNees Wallace & Nurick LLC

LABOR AND EMPLOYMENT LAW UPDATE:

THE YEAR IN REVIEW

Eric N. Athey

McNees Wallace & Nurick LLC

Phone: 717.581.3708

[email protected]

www.PALaborAndEmploymentBlog.com

March 8, 2011


LAST YEAR'S PREDICTIONS

Increased Enforcement Activities from Federal Agencies

Healthcare Reform in "Small Bites" Upward Trend in EEO Litigation

Continues Non-Compete Litigation Independent Contractor Issues Social Medial in the Workplace

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Increased Enforcement Activities from Federal Agencies

• DOL hires 250 Wage & Hour Investigators (33% increase)

• OSHA hires 130 new Inspectors

• EEOC budget seeks 224 new staff

• OFCCP budget proposes 213 new hires

Grade B+

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Healthcare Reform in "Small Bites" • Landmark Patient Protection and

Affordable Care Act passed on March 23, 2010

• 100s of pages of law and regulations – anything but small!

Grade: A+ on topic

F on "small bites"!

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Upward Trend in EEO Litigation Continues

• Yes, EEOC charges jumped from 93,277 in 2009 to 99,922 in 2010 (record high)

• No, number of cases filed in court by EEOC dropped from 314 in 2009 to 271 in 2010 (lowest since 1996)

Grade: B

5



Increase in Non-Compete Litigation • NCA litigation remains steady – but no

noticeable surge – YET

Grade: C

6



Independent Contractor Issues • PA passes law addressing employee

misclassification issues in construction industry

• Feds step up enforcement of misclassification issues

Grade: A

7



Social Media Issues in the Workplace • NLRB complaint on Facebook posting

• U.S. Supreme Court Decision in Quon case

• New Jersey Supreme Court Decision in Steingart case

• Delta Airlines "Queen of the Sky" Discrimination case

Grade: A

8


HEALTHCARE REFORM

Patient Protection and Affordable Care Act Passed 3/23/10

Some Near-Term Highlights:• Unpaid breaks for nursing mothers (2010)

• Dependent care extended to age 26 (2010-11)

• Pre-existing condition exclusions phased out (2010-14)

• Lifetime & Annual Maximum Benefit Limits phased out (2010-14)

• FSA/HRA/HSAs: OTC reimbursements nixed (2011)

• Extension of nondiscrimination rules to fully insured plans (unknown)

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HEALTHCARE REFORM

PPACA Long-Term Requirements (2014)• Free Rider Penalty: Up to $2085 annual penalty

for families who don't have coverage

• No Coverage Penalty for Employers: $2000/yr per employee

• Unaffordable Coverage Penalty for Employers: $3000 per subsidized employee

• Free Choice Vouchers

• Cadillac Tax (2018)

Issue: How much of PPACA will survive the 2012 elections?

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RECENT U.S. SUPREME COURT DECISIONS

Thompson v. North American Stainless, LP; Decided 1/24/11

Facts: • Thompson is fired 3 weeks after his co-

worker/fiancée filed a sex discrimination claim against their employer. Thompson files his own claim arguing that his termination was in retaliation for his fiancée's claim.

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THOMPSON V. NORTH AMERICAN STAINLESS, LP

Issue: • Does an employee have standing to claim

retaliation if he did not himself engage in any activity protected by the law?

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Holding:• Title VII protects those who fall within the

"zone of interests" sought to be protected by the Act. "Firing a close family member will almost always meet…the standard, and inflicting a milder reprisal on a mere acquaintance will almost never do so, but beyond that we are reluctant to generalize."

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Best Practice: • Prior to termination – consider not only

whether an employee recently engaged in protected activity, but also whether his/her family members or significant others (who are co-workers) have done so.

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RECENT U.S. SUPREME COURT DECISIONS

City of Ontario v. Quon; Decided 6/17/10 Facts:

• City had Internet/E-Mail Policy limiting use of computers, related equipment, e-mail, programs, etc. to city-related business only. Policy specifically reserved City's right to monitor all activities and stated users should have no expectation of privacy or confidentiality. Quon signed employee acknowledgment.

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CITY OF ONTARIO V. QUON

Facts:• But, lieutenant told officers that it was not his

intent to audit the content of text messages, and that if they went over 25,000 characters per month, the officer would have to pay the overage charges. Quon went over several times and paid the overages. The Chief of Police then decided to audit those who repeatedly had overages. Audit disclosed that Quon had been "sexting" to both his wife and mistress.

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Issue: • Does police officer have reasonable

expectation of privacy in text messages transmitted on his city-issued pager, when policy department has an official no-privacy policy but a non-policymaking lieutenant announced an informal policy of allowing some personal use of pagers?

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Holding:• In order to be reasonable, a public

employer's work-related search must be justified and the search must be related to the justification and not excessively intrusive. In this case, the search was justified for the Chief to determine whether established text message limits were too high or low – and the scope was appropriately limited.

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CITY OF ONTARIO V. QUON Even though this is a public sector case, and the Fourth Amendment does not apply to private sector employers, there are implications for private sector employers.Interested parties filing briefs on behalf of Quon include the AFL-CIO and the ACLU.

Do you have written policies delineating your employees' expectations of privacy in communications such as e-mail, pagers, iPhones, and other mobile tools that are used both inside and outside the workplace?

Even if you have such a policy, is it being clearly and consistently communicated to employees by your supervisors?

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IN NEIGHBORING STATES . . .

Steingart v. Loving Care Agency, Inc. Facts:

• Employee used Company-issued laptop to exchange e-mail through her personal password-protected, web-based e-mail account. After she resigned and returned the laptop, Company hired experts to create forensic image of laptop's hard drive.

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STEINGART V. LOVING CARE AGENCY, INC.

Facts:• Company reviewed seven e-mails between

employee and her attorney which referenced "attorney-client communication" and "privileged and confidential."

• Company's Electronic Communications Policy (ECP) reserved Company's right to review and access all matters on Company's media systems, and stated e-mail communications are not to be considered personal or private (but also stated "occasional personal use is permitted").

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Facts:• Company reviewed seven e-mails between

employee and her attorney which referenced "attorney-client communication" and "privileged and confidential."

• Company's Electronic Communications Policy (ECP) reserved Company's right to review and access all matters on Company's media systems, and stated e-mail communications are not to be considered personal or private (but also stated "occasional personal use is permitted").

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Issue: • Did Company have right to retrieve e-mail

from Company-issued laptop after employee resigned, where e-mail was between employee and her attorney discussing her discrimination claims against the Company?

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Holding:• New Jersey Supreme Court held that

employee had a reasonable expectation of privacy, particularly where e-mail communications referenced "attorney-client privilege."

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Court unanimously holds for employee, focusing on the adequacy of the notice provided by the ECP as well as the attorney-client privilege.

ECP did not give employees express notice that messages sent or received on a personal, web-based e-mail account were subject to monitoring.

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ECP did not warn employees that the content of such e-mails was stored on a hard drive and could be forensically retrieved and read by the Company.

"Occasional personal use is permitted!" Even if ECP had not been "ambiguous," the

attorney-client privilege is "historically cloaked in privacy."

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Even if ECP had banned all personal computer use and provided clear notice that Company could retrieve and read e-mails on a personal, password-protected e-mail account, Court says it would still not enforce ECP where it conflicted with attorney-client privileged communications!

27


NLRB UPDATE

Employee Termination for Facebook Post Triggers NLRB Complaint

Facts:• Unionized employee posts negative

comments mocking her supervisor on her Facebook page. Other employees comment on the post – triggering further negative posts from the employee. Employee is terminated for violation of the employer's social media policy.

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NLRB UPDATE

Issue:• Does termination violate National Labor

Relations Act which protects the right of employees to concertedly discuss wages, benefits and other working conditions.

Outcome:• Based on an initial investigation, the NLRB

issued a complaint which was subsequently settled on February 7, 2011 before the matter proceeded to a hearing.

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THE REGULATORY AGENDA

U.S. DOL Spring Regulatory Agenda: New Burdens for Employers

• "Plan, Prevent, Protect" Strategy.

• Onus on employers to demonstrate compliance with wage and hour, safety, federal contract compliance, and other laws overseen by DOL.

• Employers will have to prepare, implement, and share with employees comprehensive compliance programs (certify their own compliance).

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THE REGULATORY AGENDA DOL PLAN, PREVENT, PROTECT

"Plan" for identifying and remedying potential violations, e.g., search workplace for safety hazards that might injure employees.

"Prevent" legal violations by implementing the plan.

"Protect" employees from violations of their workplace rights.

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THE REGULATORY AGENDA DOL PLAN, PREVENT, PROTECT

Example: If employer wants to exclude individuals from overtime compensation under FLSA, employer must do a classification analysis, disclose that analysis to employees, and retain the analysis for DOL enforcement personnel.

• Suppose employee does not agree with analysis? Litigation? Union organizing?

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THE REGULATORY AGENDAEEOC ATTACKS INFLEXIBLE LEAVE POLICIES

Provisions Under Attack:• Automatic termination if employee cannot

return after specified time

• Offering light duty work only to employees injured on the job

• Refusing job transfer when an employee is unable to perform regular job

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Issue: To what extent does ADA duty of reasonable accommodation require modification of leave policies and existing jobs?

Reference: http://www.eeoc.gov/policy/docs/accommodation.html

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Recent EEOC Settlements on these issues:

• Sears, Roebuck $6.2M in Sept. 2009

• Jewel/Osco $3.2M in Dec. 2010

• JP Morgan $2.2M Nov. 2006

• Cases pending vs. UPS, United Airlines and Denny's

35


ADA AMENDMENTS ACT OF 2008 AND EEOC'S PROPOSED RULEMAKING

Final regulations awaiting approval by OMB Congress overruled Supreme Court cases which

had narrowed the definition of "disability." Amendments broaden definition of "disability." Mitigating measures (other than eyeglasses or

contact lenses) shall not be considered in assessing whether an individual has a disability.

• Such measures include medication, medical equipment and devices, prosthetics, hearing aids, mobility devices, etc.

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EEOC has proposed the following as "per se" disabilities: Deafness, blindness, intellectual disability (formerly known as mental retardation), partially or completely missing limbs, mobility impairments requiring use of a wheelchair, autism, cancer, cerebral palsy, diabetes, epilepsy, HIV/Aids, multiple sclerosis, muscular dystrophy, major depression, bipolar disorder, post-traumatic disorder, obsessive-compulsive disorder, and schizophrenia.

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• EEOC has proposed the following as impairments that may be substantially limiting for some individuals (and therefore constitute a disability), but not necessarily for all other individuals: Asthma, high blood pressure, back and leg impairments, learning disabilities, panic or anxiety disorders, some forms of depression, carpel tunnel syndrome, and hyperthyroidism.

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• EEOC has proposed that temporary, non-chronic impairments of short duration usually will not substantially limit a major life activity and therefore usually should not constitute a disability: Common cold, seasonal or common influenza, a sprained joint, minor and non-chronic gastrointestinal disorders, a broken bone expected to heal completely, appendicitis, and seasonal allergies.

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YOUR COMPANY'S WEBSITE AND THE ADA

July 26, 2010: DOJ publishes notice announcing possible "website accessibility" regulations

Barriers which may need to be addressed:• Font color and size that doesn't accommodate

visually impaired

• Websites relying heavily on images that can't be interpreted by "screen readers" or other assistive technology

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YOUR COMPANY'S WEBSITE AND THE ADA

Barriers which may need to be addressed:

• Websites requiring timed responses from users without option for more time if needed

• CAPTCHAs (distorted text for code-access purposes) which may not be usable by visually impaired

Stay tuned!

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ADA UPDATE

ADA May Require Employer to Accommodate Employee's Difficulty Commuting to Work.

• Colwell v. Rite Aid Corp., 22 AD Cases 1857 (3rd Cir. 2010)

• Colwell was a cashier working at a Rite Aid store from 5 to 9 p.m.

• She became blind in one eye, and then requested transfer to day shift, stating she had trouble driving at night (supported by a doctor's note).

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ADA UPDATE

• Company rejected her request for day shift, stating it would not be fair to her co-workers. After trying to rely on rides from family members, Colwell resigned and sued for disability discrimination (failure to accommodate).

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ADA UPDATE

• Court of Appeals agrees with Colwell, rejecting Company's claim that commuting to and from work is unrelated to workplace.

• "We hold as a matter of law that changing Colwell's working schedule to day shifts in order to alleviate her disability-related difficulties in getting to work is a type of accommodation that the ADA contemplates."

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MISCLASSIFICATION OF INDEPENDENT CONTRACTORS

Worker misclassification is a hot topic for employers in 2011 – and in 2012!

The Department of Labor's FY 2012 budget request earmarked significant resources – almost $50 million – to "combat worker misclassification."

On October 13, 2010, Pennsylvania enacted the Construction Workplace Misclassification Act.

• Pennsylvania's Act provides detailed criteria for the appropriate classification of independent contractors and also imposes a variety of civil and criminal penalties against businesses and individuals for misclassifying employees

45


PA'S CONSTRUCTION WORKPLACE MISCLASSIFICATION ACT

Very specific requirements to be considered an independent contractor:

• Written contract

• Freedom from direction or control – both under the contract and in fact

• Engaged in an independently established trade, occupation or business

Penalties apply separately for each individual misclassified:

• Civil penalties – $1,000 to $2,500 per violation; a stop-work order

• Criminal penalties – summary offense ($1,000 penalty), second or third degree misdemeanor

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MISCLASSIFICATION – WHAT DOES THIS MEAN FOR YOU?

A sign of things to come: although Pennsylvania's Act focuses on the construction industry, misclassification is an important topic for all employers!

• Similar criteria will apply to evaluations of independent contractor misclassification in other areas of the law, potentially exposing you to liability for misclassified employees under wage and hour laws, discrimination laws, and in unemployment compensation

Review your employee classifications now to ensure that your employees and independent contractors are appropriately classified to avoid penalties.

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THE GENETIC INFORMATION NON-DISCRIMINATION ACT

What does GINA mean for you? • Prohibits the use of genetic information in

employment decisions

• Restricts your ability to request, require, or purchase genetic information

• Requires you to treat all genetic information as confidential medical information and places restrictions on the disclosure of such information

The EEOC's GINA regulations became effective January 10, 2011.

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WHAT DO THE EEOC'S GINA REGULATIONS SAY?

The definition of "genetic information" is very broad and includes any information about the genetic information of an individual's family members.

• The regulations also define "Family members" very broadly (e.g., first cousins, great-great-grandchildren)

The EEOC's regulations also provide a "safe harbor" for employers in situations where employers must ask employees (or their medical providers), such as:

• Medical leave requests

• Reasonable accommodation requests

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USE GINA'S SAFE HARBOR LANGUAGE

The Genetic Information Nondiscrimination Act of 2008 (GINA) prohibits employers and other entities covered by GINA Title II from requesting or requiring genetic information of an individual or family member of the individual, except as specifically allowed by this law. To comply with this law, we are asking that you not provide any genetic information when responding to this request for medical information. ‘Genetic information’ as defined by GINA, includes an individual’s family medical history, the results of an individual’s or family member’s genetic tests, the fact that an individual or an individual’s family member sought or received genetic services, and genetic information of a fetus carried by an individual or an individual’s family member or an embryo lawfully held by an individual or family member receiving assistive reproductive services.

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TAKE ADVANTAGE OF GINA'S "SAFE HARBOR"

If an employer includes the GINA regulations' "safe harbor" language in its requests for medical information, any disclosure of "genetic information" will be considered inadvertent.

Employers should incorporate the GINA safe harbor language into every general request for employee medical information.

Review your forms and employee communications to ensure that those containing requests for medical information include the "safe harbor" language:

• Extra precaution: include the language with FMLA-related requests or certification, even if your company uses the Department of Labor's forms!

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UNEMPLOYMENT COMPENSATION LAW UPDATE

Bruce v. UC Board of Review, May 19, 2010 • Evidence supported Board's findings that

claimant's violation of employer's "no call / no show" policy was wanton and willful

• Claimant's incarceration for non-work related misconduct did not constitute "good cause" for her failure to call off work

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Bruce v. UC Board of Review, May 19, 2010 • Facts: Bruce and her nephews were arrested

for shoplifting as they left a mall on March 2nd. Those charges against her were withdrawn, but as a result of the search at the time of the arrest, the police discovered illegal drugs in her purse. While she was trying to post bail on March 3rd she had her aunt call her employer and report that her dog was sick and she would be in to work on March 4th .

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Bruce v. UC Board of Review, May 19, 2010 • Facts (continued): Employer learned that

evening Bruce was in jail. On March 4th her aunt called to report they were on their way to bail her out. Bruce did not report to work or call off on March 5th or 6th. Bruce was terminated for job abandonment for failure call in for 2 days as per employer's policy. Bruce entered the ARD program and was placed on 12 months probation.

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Bruce v. UC Board of Review, May 19, 2010 • Facts (continued): Commonwealth Court held

that Bruce's incarceration was not through no fault of her own given she was not acquitted of the charges but entered into the ARD program, which failed to show that her reason for not calling off was through no fault of her own.

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Philadelphia Parking Authority v. UC Board of Review, July 14, 2010

• Insufficient evidence to support employer's claim that claimant deliberately or intentionally violated work rules by sleeping on the job

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• Facts: Claimant Heeney was assigned to the "money room" on the 3:30 pm to midnight shift. She could no longer work in her original position as a supervisor due to complications of uncontrolled diabetes and was diagnosed with sleep apnea. She would sit in the room for hours at a time with nothing to do

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• Facts (continued): Despite the fact that she asked for additional work to keep her busy, employer only provided her with two limited assignments. Claimant fell asleep in the money room on four different days. She was terminated for violating a work rule of sleeping on the job.

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• Facts (continued): Employer denied having knowledge of claimants sleep apnea condition.

• Claimant's violation of a work rule was not intentional and she attempted to resolve her problem in a responsible manner in order to protect the interests of her employer.

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EMPLOYMENT AT-WILL / WRONGFUL DISCHARGE UPDATE

At-will employees may sue for wrongful discharge if:Employee is terminated by hospital for suing hospital due to serious injuries incurred by newborn son in hospital's neonatal intensive care unit (Haun v. Community Health Systems, Pa. Super 1/19/11)

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EMPLOYMENT AT-WILL / WRONGFUL DISCHARGE UPDATE

At-will employees may sue for wrongful discharge if:Employer refuses to rehire employee due to prior service in the National Guard (even if employee has already filed claims under federal and state military leave laws)(Hamovitz v. Santa Barbara Applied Research, Inc., W.D.Pa. 10/19/10)

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WHAT TO EXPECT FOR 2011?

Continued fine tuning of PPACA and continued debate over longer term repeal or overhaul

Wage & hour class action litigation spreads to other industries, occupations and locales

Social media in the workplace continue to present new and unusual issues for HR

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WHAT TO EXPECT FOR 2011?

Fervor over public sector collective bargaining spreads to PA – but laws untouched

ADAAA regulations spread the love: We're all disabled! (The first in-grown toenail ADA suit?)

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© 2011 McNees Wallace & Nurick LLC LABOR AND EMPLOYMENT LAW UPDATE: THE YEAR IN REVIEW Eric N....

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Transcript of © 2011 McNees Wallace & Nurick LLC LABOR AND EMPLOYMENT LAW UPDATE: THE YEAR IN REVIEW Eric N....