Employment Law Bits

Non-solicitation agreements: beware of enticing former clients

Violations of non-solicitation agreements are not limited to situations where the former employee who signed an agreement reaches out to the other party first. In Corporate Techs., Inc. v. Harnett, the First Circuit affirmed the district court’s ruling that the issue is not who made the first call, but whether the employee was involved in helping his new employer entice his previous clients.

In Corporate Technologies, the non-solicitation agreement prevented the defendant salesperson from soliciting, diverting, or enticing away his old clients from his previous employer. The agreement was to last for one-year post-employment.

Subsequently, the salesman accepted a job with a new employer, who sent out announcements to more than 100 potential clients. 4 of the salesman’s previous clients responded to the announcement, and soon thereafter, one of the clients signed a contract with the new company.
The former employer, Corporate Technologies, successfully sued for a preliminary injunction because the district court was not convinced by the “first-to-contact” defense raised by the salesman and his new employer. See Corporate Techs., Inc. v. Harnett. “Neither the plain meaning of the word, “solicit,” nor the plain meaning of the word, “entice,” requires some kind of first contact.” The agreement “does not allow a salesman to take active steps to persuade the client and actually solicit business.”

The First Circuit affirmed, where a former employee began working for a former employer's competitor, the former employer was properly granted a preliminary injunction as to its claims for breach of a non-solicitation agreement and tortious interference because a per se rule regarding initial contact by a customer was not appropriate under Massachusetts law, the identity of the party making initial contact was just one factor among many, and the former employee's persistent pattern of pursuing patronage permitted a plausible inference that he was urging customers to do business with the competitor rather than the former employer.

Care should always be exercised when hiring a competitor’s former employee. While the injunction did not prevent the new company from doing business with market segments so long as the salesperson was not involved in the initiative, the cost of working through potential issues can be expensive.

 

Image credit: Victor1558, under Creative Commons license

The Supreme Court defines “supervisor” for purposes of Title VII

A recent decision by the Supreme Court limits employer liability in certain harassment cases. Workplace harassment based on sex, race, or national origin is strictly prohibited by Title VII; however, under the statute, employers will be held strictly liable in harassment suits, only when the harasser is a “supervisor.” If the harasser is an employee, then the victim must meet the burden of the negligence standard.

Unfortunately, the term, supervisor, is vague and remains undefined by Title VII. While many employees operate under a formal supervisory title, many lower-level employees are in charge of scheduling and assigning work, as well as directing other employees.

In Vance v. Ball State University, the plaintiff worked in a university kitchen as a catering assistant. She took most of her orders from the catering specialist, and she claimed that while working there she was harassed and assigned to unnecessary menial tasks because of her race. The plaintiff complained multiple times of the racial discrimination. However, the problem was never resolved. This resulted in the plaintiff filing a complaint in federal court, alleging that she suffered a hostile work environment, in violation of Title VII. She further advanced that the catering specialist was her supervisor and responsible for the hostile environment.

The court held that the catering specialist was not the plaintiff’s supervisor, and thus the employer — Ball State University — could not be held vicariously liable. Upon hearing the case, the 7^th Circuit determined supervisor liability only adheres when the harasser has “the power to hire, fire, demote, promote, transfer, or discipline an employee.” Since the plaintiff did not demonstrate that the catering specialist had requisite control over her employment, the plaintiff could not recover.

The Supreme Court ruled on the issue and in a recent 5-4 ruling determined, that for purposes of Title VII, employees can only count as supervisors when the have the power to hire, fire, and promote. Title VII itself does not define the term “supervisor.” Thus, the circuit split is resolved. 

 

Image credit: Microsoft

New MA law requires fingerprinting of teachers and childcare workers

In April of this year Mass. Gen. Law ch 71 § 38R went into effect. This law mandates that the Department of Early Education and Care (EEC) and school districts conduct fingerprint-based national criminal background checks on all teachers, employees, and early education providers operating within the Commonwealth. Before this law was in place, the above mentioned employees were subject only to Criminal Offender Record Information (CORI) checks, which only cover crimes committed in Massachusetts. This new law greatly expands the availability and depth of inquiry into the background information for prospective educational employees.

Who will be affected?

This law will apply to public and private schools as well as special education and day care programs. The law will further extend to all individuals with teaching licenses, all employees working within licensed programs, family child care providers, all household members of family child care providers (over the age 15), and all individuals in licensed programs who will have unsupervised contact with children. Further, the fingerprinting and background checks will apply to anyone seeking to adopt or foster children.

Pursuant to the law, all newly hired teaches, janitors, bus drivers, and subcontractors must comply with the finger-printing prior to the commencement of the 2013-14 school year. Current faculty and staff around the Commonwealth will have three years to comply.

The fingerprints will be submitted to the state police for a statewide criminal background checks. Thereafter the fingerprints are forwarded to the Federal Bureau of Investigation where a nationwide background check will take place. According to the governor, neither the state nor individual school districts will be responsible for footing the bill for the fingerprinting. Rather, the individual subject to the fingerprinting will have to pay a fee. The fee will range from $35-$55.

 

Photo credit: commons.wikimedia.org 

Employers beware the use of broad criminal background checks

It has been just over one year since the Equal Employment Opportunity Commission (EEOC) issued revised guidance for employers using broad criminal background checks. The guidance warned against using criminal background checks to exclude applicants without establishing why a criminal record should disqualify an applicant.

The EEOC has now filed its first two lawsuits on the issue since issuing the guidance last year.

The first was filed against BMW after a policy change expanded the use of criminal record checks in hiring decision. The warehouse in South Carolina previously had a policy that excluded applicants if they had a criminal record within the past seven years. When a new contractor took over the warehouse, BMW changed the policy to exclude anyone with any criminal record at any point in time. Of the 88 workers who were fired, 70 were black.

The second case involves two prospective employees of Dollar General, both of whom are black. One applicant was offered a job after she disclosed a six year old conviction for possession of a controlled substance, only to have the offer revoked alleged because Dollar General’s policy was not to hire anyone with such a record within the past 10 years. The second applicant was fired when a criminal record check showed she had a felony conviction, even after she told Dollar General that it was a mistake.

Both of these cases highlight the importance of employers using criminal background checks carefully when making employment decisions. In order to justify the use of criminal background checks, employers should consider the following:

• The nature and gravity of the offense or conduct;
• The time that has passed since the offense, conduct and/or completion of the sentence; and
• The nature of the job held or sought.

By identifying how a specific conduct is linked to job performance, an employer can better explain why a background check is a valid element of a hiring process. It is also important to conduct an individualized assessment, allowing applicants to address their criminal record, especially inaccuracies and any reasons why the exclusion should not apply. And of course, employers must abide by the new CORI regulations.

CORI: What info is released and for how long?

Employees with criminal records are likely familiar with recent reform concerning the Criminal Offender Record Information (CORI) database. However, for those potential employees with certain misdemeanors on your records, there is important information that you should know. Under Massachusetts law, various industries, agencies, and employers are allowed to access the database to obtain criminal records of potential employees and tenants. However, under the CORI statute, criminal offender information is limited to the following circumstances

• felony convictions for 10 years following the disposition thereof, including termination of any period of incarceration or custody,
  
  
• misdemeanor convictions for 5 years following the disposition thereof, including termination of any period of incarceration or custody, and
  
  
• pending criminal charges, which shall include cases that have been continued without a finding until such time as the case is dismissed

See M.G.L.A. 6 § 172 (3).

After the 5-year statutory waiting period for misdemeanors, most ex-cons are able to have criminal records sealed through an administrative process. For most convictions, the waiting period starts from the date the individual was found guilty or released from incarceration, whichever is later. This 5-year period continues to run as long as the convicted individual receives no other convictions. Upon receiving another conviction, the 5-year clock resets.

Sealing, however, does not occur automatically. The petition process takes place predominantly through the mail. The individual sends a “petition to seal” to the commissioner of probation located in Boston. After a record is sealed, the individual may indicate that he or she has “no record” when asked by potential employers.

However, not all convictions are eligible for sealing in the Commonwealth. Pursuant to Mass. Gen. Laws c. 276,§ 100A, convictions for “violations against public justice” can never be sealed. This includes violations such as resisting arrest, witness intimidation, and perjury. Thus, individuals should take substantial precautions when faced with these types of charges. They will not be able to be sealed at a later date and will signal to employers the individual’s character for truthfulness for years to come.

 

Photo credit: Microsoft

Temporary workers right to know act

During economic downturns, temporary workers in the Commonwealth rely on staffing and employment agencies to place them in wage earning positions. However, workers who rely on such agencies have been subject to wage theft and even hazardous conditions in the past. To prevent this from occurring, Massachusetts enacted a statute that went into effect in January. This law greatly increases the duties of staffing agencies and provides minimum protections for temporary workers.

The law was created due to criticisms of staffing agencies that were providing little information about job placements to workers. The law applies to all workers placed in laboring, construction, and manufacturing positions. Those temporary workers placed in office settings are exempt from the law.

The new statute, codified at M.G.L. c.149 § 159C, mandates that staffing agencies provide each employee with the following information:

• The name, address, and phone number of the staffing agency, its workers compensation carrier, and the worksite employer
• A description of the position as well as requirement for the job (i.e special clothing, equipment, licenses,) as well as the costs of those requirements
• Designated payday, start time, end time
• Further, staffing agencies will be prohibited from charging workers for:
• Registering with the agency
• The cost of criminal background checks required by the company to which they are assigned, or
• Any other goods or services that cause their pay to fall below the minimum wage.

Failure of staffing agencies to abide by the new law may result in harsh civil fines of up to $25,000 and even criminal sanctions, so agencies should take proactive steps to ensure compliance with the new law:

• Budget appropriately for the administrative paper work that will be necessary for compliance.
• Be on the look-out for Massachusetts Department of Labor Standards that will further interpret the statute.
• Contact employment counsel with any questions and/or concerns

Photo credit: Microsoft

Precedent set that allows employers to refuse to hire a former whistleblower

The Fair Labor Standards Act (FLSA) makes it very clear that an employer is not allowed to retaliate against an employee for reporting FLSA violations. However, according to the Fourth Circuit Court of Appeals, employers are allowed to refuse to hire someone who “blew the whistle” on a former employer.

The Fourth Circuit Court of Appeals ruled in Dellinger v. Science Applications International Corp, that an employer cannot be sued for retaliation when they refuse to hire a prospective employee who filed an FLSA lawsuit against a former employer. The court based this ruling on the determination that retaliation does not occur when an employment relationship between the parties never existed.

While this ruling is not binding in Massachusetts, it does create a persuasive argument that employers in Massachusetts could make to combat similar claims. Where no employment relationship has previously existed, it is very hard to make any sort of claim of retaliation against that employer.

Whistleblowing employees should be aware that while they will be protected against retaliation from the employer against whom the complaint was filed, that protection my not follow the employee to other companies. This may severely hurt employees’ chances of being hired elsewhere, especially if the claims that were filed against the employee’s previous employer were without merit.

It should be noted that while employers who refuse to hire former whistleblowers may be protected from an FLSA claim, the same may not be true for a claim under Title VII, which prohibits retaliation against applicants for employment, as well as current employees.

 

Photo credit: Microsoft

 

Is it permissible to require a high school diploma for a job?

The ability of some employers to require a high school diploma for all employees may be vanishing due to an Equal Employment Opportunity Commission (EEOC) ruling that screening out applicants for certain jobs based only on a diploma may be discriminatory.

The basis behind this decision is that there are some individuals who, because of a learning disability, were unable to obtain a high school diploma. The EEOC has said that an employer may need to allow an applicant without a high school diploma to demonstrate qualifications for the job in other ways, such as work experience or the ability to perform the essential job functions. This will allow potential employees without a high school diploma to be competitive for jobs where the essential elements of the job could be performed regardless of degree status.   

On the other hand, this requirement will not apply to jobs where an employer is able to demonstrate that the diploma requirement is job-related and consistent with business necessity. The EEOC has recognized that there will be positions where a high school diploma is an absolute necessity and employers need to be able to screen out applicants without the necessary credentials.

What this means is that if the necessary job functions of the position in question cannot be performed without a high school diploma, then an employer will be able to limit applicants based on that qualification requirement. Employers who want to determine what they should require for specific positions should consult an employment law attorney.

 

Photo credit: Microsoft 

Interviewing: employers must be careful about certain discriminating questions

Job interview questions are an often overlooked area of discrimination law. Many don’t realize that screening out job candidates via seemingly innocent questions that may touch upon age, gender or religion is just as illegal as firing an employee because he’s handicapped. The wrong question can result in a lawsuit almost as easily as other acts of discrimination can.         

Massachusetts anti-discrimination laws govern pre-employment activity as well as conduct that occurs after an employee begins work. The Massachusetts Commission Against Discrimination (MCAD) has published rules to help guide employers as to the questions they can ask prospective employees and those they cannot. The MCAD’s guidelines on pre-employment inquiry follow.

Age: Generally, the only proper question is, "Are you under 18, yes or no?"

Handicap: Inquiry into whether the applicant has a physical or mental disability, handicap or about the nature or severity of the disability/handicap is prohibited, as is inquiry into whether an applicant is alcoholic, is drug addicted, or has AIDS.

National Origin: An employer may ask, “Are you legally authorized to work in the United States?" An employer may not inquire into the birthplace of an applicant or the birthplace of his or her parent(s,) spouse and/or other close relatives.

Race: Generally, an employer may not inquire into the race or color of an applicant, and an employer cannot require that a photo accompany a job application.

Religion: No questions are permitted. No inquiry into the religious denomination or practices of an applicant, his or her religious obligations, or what religious holidays he or she observes can be asked.

Gender: Generally, few if any questions can be asked. However, questions regarding gender may be permissible if they relate to a bona fide occupational qualification, which has been ruled to be a legitimate requirement for a particular position.

Sexual Orientation: No inquiry into an applicant’s sexuality, (gay, bisexual, lesbian, heterosexual,) is permitted.

Criminal Record: Employers may ask the following series of questions:

1. Have you been convicted of a felony? Yes or no?

2. Have you been convicted of a misdemeanor within the past five years (other than a first conviction for any of the following misdemeanors: drunkenness, simple assault, speeding, minor traffic violations, affray or disturbance of the peace?) Yes or no?

3. Have you completed a period of incarceration within the past five years for any misdemeanor, (other than a first conviction for any of the following misdemeanors: drunkenness, simple assault, speeding, minor traffic violations, affray or disturbance of the peace?) Yes or no?

4. If the answer to question number 3 above is "yes," please state whether you were convicted more than five years ago for any offense, (other than a first conviction for any of the following misdemeanors: drunkenness, simple assault, speeding, minor traffic violations, affray or disturbance of the peace?) Yes or no?

Education/Experience/References/Organizations: Inquiry into the academic, vocational or professional education of an applicant for employment is permitted. The request shall also contain a statement that the applicant may include in such history any verified work performed on a volunteer basis.

 

 Photo credit: Microsoft 

What are Bona Fide Occupational Qualifications?

Bona Fide Occupational Qualifications, otherwise known as BFOQ’s, is a defense to acknowledged discrimination. A BFOQ is a practice or policy that is essential to the operation of an employer’s business.

Title VII of the ADA permits an exception to the rule against discrimination on the basis of religion, sex or national origin where these characteristics constitute a BFOQ reasonably necessary to the normal operation of a business. This exception has also been extended to discrimination based on age through the Age Discrimination Employment Act (ADEA). This exception does not apply to discrimination based on race.

Whether a policy amounts to a BFOQ is dependent on the facts specific to a business and its objectives. This is ultimately a factual determination for a court or jury. When an employer claims the defense of BFOQ, the employer has the burden of proving the discriminatory policy is valid and must demonstrate that its discriminatory practice is related to the essential operation of the business. This can be demonstrated with expert witnesses, empirical data, surveys, or studies. 

In regards to age discrimination, the BFOQs usually apply to jobs that are physically demanding. Employers are prohibited from attempting to hire within certain age groups, and ADEA regulations state that, “…when help wanted notices or advertisements contain terms and phrases such as 25 to 35, young, college student, recent college graduate, boy or girl, or others of similar nature, such a term or phrase deters the employment of older persons and is a violation of the Act,” unless a BOFQ applies.

Current law makes it clear that an employer cannot discriminate on the basis of religion, sex, or national origin. But, what if an employer had a policy to only hire “attractive” applicants and not “unattractive” ones? There are no cases holding that being “plain,” “unattractive,” or “ugly” is a disability within the meaning of the Americas with Disabilities Act (ADA.)  However, it is clear that disfigurement or obesity are usually considered disabilities within the ADA. Therefore applicants who are not hired due to disfigurement or obesity may have a legitimate claim.

By means of example, In the case of Latuga v. Hooters, Inc., the Hooters of America franchise raised the BFOQ defense by stating that their “restaurant concept . . . includes certain ambience requirements and a female waitstaff wearing cutoff t-shirts, tanktops, and orange jogging shorts.” This case was settled out of court, and therefore, no determination was made as to whether Hooters asserted a valid BOFQ defense.

The law is unsettled when it comes to discriminating based on attractiveness. However Bona Fide Occupational Qualifications is a well settled exception to discrimination where it is necessary to the essential operation of a business.

 

Photo credit: Microsoft