Employment Law Bits

Law prohibits federal contractors from retaliating against employees who discuss their compensation

On April 8, 2014, President Obama issued an executive order prohibiting federal contractors from retaliating against employees who discuss their compensation. But this executive order only applies to federal contractors, so what about all other employees?

The National Labor Relations Act, passed in 1935, allows private sector employees to engage in “concerted activities for the purpose of collective bargaining or other mutual aid or protection.”

Not all employees are covered by the National Labor Relations Act though. First, it only covers private sector employers, so employees of federal, state, and local governments are not covered. Second, supervisors who can make recommendations to hire and fire employees are not covered, nor are agricultural works or employers subject to the Railway Labor Act. Additionally, human resource employees cannot disclose the salaries of other employees, but can discuss their own salaries.

While there are social reasons why employees may not feel comfortable discussing pay, some employers also have pay secrecy policies – whether written or undocumented. The National Labor Relations Board has long found pay secrecy policies to be in conflict with the act and has brought action against employers for retaliating against employees for discussing their pay. However, only the NLRB can act on an employee’s complaint – the employee cannot sue the employer in court – and the damages that may result are back pay and reinstatement of the employee.

The new executive order raises the stakes for federal contractors: if a federal contractor retaliates against an employee, he or she risks losing the federal contract they are awarded as well.

Image credit: http://underclassrising.net

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

 

When can performance reviews become grounds for a discrimination or retaliation claim on the part of an employee?

When supervisors conduct employee reviews, they may be doing much more than giving constructive feedback. In fact, employee reviews can be a crucial piece of evidence when defending against a claim of employment discrimination.

For this reason, employers should assure that those supervisors, or anyone else in charge of doing performance reviews, take great care to make a true and accurate assessment of an employee’s actual performance. Failing to do so could have dire consequences should litigation arise later.

Human nature can make many supervisors hesitant to give an employee a poor review because they know they will need to work with that employee in the future. This may cause supervisors to inflate reviews in an effort to avoid confrontation or tension with an employee who may not be performing at their highest potential.

While this may seem harmless enough and may even promote a less tense work environment, generous reviews could mean the difference between successfully defending a lawsuit or being found guilty of discrimination. This could occur when employees are terminated for poor performance despite performance reviews that indicate satisfactory performance.

Should an employee be terminated for poor performance, but later claim discrimination, the generous performance reviews created by that employee’s supervisor will do nothing but enhance that employee’s claim. A jury that sees satisfactory ratings on multiple performance reviews may be more likely to find discrimination or retaliation when that same employee is later terminated for bad performance. This could allow an employee to succeed on a false claim of discrimination or retaliation simply because the performance reviews do not back up the employer’s claims.

For these reasons, employers should instill in all managers and supervisors that accurate performance reviews are an absolute necessity. This may be especially difficult in smaller companies where many supervisors and employees have developed close relationships that would make a supervisor want to protect an under-performing employee. It is up to the employer to ensure that this type of activity is not tolerated, because it could impart liability on an employer later on, as well as lead to the retention of under-performing employees. 

 

Photo credit: Microsoft

 

When does FMLA leave clash with company leave policies?

The Family and Medical Leave Act (FMLA) requires that employers give employees with medical conditions adequate time to deal with those conditions without fear of losing their jobs.  

However, like any other system, there is a potential for abuse by less than honest employees who might try to use the system for their own benefit. This may include requesting leave to extend vacations, get additional time off, or simply to avoid working holidays. These types of extensions are an abuse of the FMLA system and will allow an employer to terminate an employee for misuse of the system.

This very situation occurred in a Utah case when a Southwest Airlines employee who suffered from backaches requested FMLA leave 35 times to excuse him from work on days immediately following or preceding his already scheduled time off. The employee also regularly took FMLA leave on important dates and holidays, allowing him to get time off when he otherwise would not have been able to. After conducting an investigation into the employee’s pattern of leave, Southwest determined that the leave was a misuse of the FMLA system and terminated him for abusing the company attendance policy.

The employee filed suit against Southwest, claiming retaliation for use of his FLMA leave, as well as disparate treatment under the Americans with Disabilities Act, (ADA,) for failing to accommodate his disability. The court found that Southwest presented adequate evidence to show that the termination was not discriminatory and was justified as an abuse of the FMLA program.

Southwest went so far as to hire an independent party to analyze the evidence and determine if the employee had, in fact, violated the attendance policy. The court also found that Southwest did not violate any ADA protections because the termination was based solely on the belief there was a violation of the attendance policy, and Southwest did, in fact, grant all of the requested FMLA leave that the employee requested.

What this ruling means is that as an employer, if you believe that you have an employee who is abusing the FMLA leave system, you are not without recourse. As a first step, you should contact an employment law attorney for advice on how to proceed. Then you will need ample evidence of abuse of the system, as well as a showing that any termination was not retaliation for requesting leave.

An employer has the right under the ADA to discipline employees for violation of company policies, regardless of disability. Therefore, if you believe you have an employee who is using his or disability to get around company policies, you should consult an employment law attorney to discuss your options for handling that employee. 

 

Photo credit: Microsoft

 

What is the Merit Systems Protection Board, and what does it do?

The U.S. Merit Systems Protection Board is an independent agency in the executive branch of the federal government that serves as the guardian of federal merit systems. This board, also known as the MSPB or the Board, is an appeals board that enables federal employees to challenge certain decisions made by the federal agencies where they are or were employed.

The MSPB is designed to protect federal employees by hearing and deciding appeals by federal employees that involve discipline, removal, lengthy suspensions, performance matters, and whistleblower retaliation. It is composed of three members, bi-partisan, and no more than two of its three members may be from the same political party.

The board may hear appeals of federal agency actions only when it has been expressly authorized to do so by law, rule, or regulation. A list of actions or decisions that are appealable to the Board can be found in the Board’s regulation at 5 C.F.R. § 1201.3. The majority of cases within the Board’s jurisdiction are appeals of adverse actions; removals, suspensions of more than 14 days, and reductions in pay or grade.

When an agency issues a decision notice to an employee on a matter that is appealable to the MSPB, the agency must provide the employee with the following: (1) notice of the time limits for appealing to the board and the address of the appropriate Board office for filing the appeal; (2) a copy, or access to a copy of the Board’s regulations; (3) a copy of the Board’s appeal form; and (4) notice of any right the employee has to file a grievance.

If an employee is a member of a bargaining unit that is represented by a union or an association, the bargaining agreement may have a negotiated grievance procedure available to the employee. Oftentimes, the grievance procedure will cover personnel actions that by law may otherwise be appealed to the board.

It is possible that the employee may have a choice between filing either a grievance with the agency or an appeal to the board. The employee may not file with both.

You may choose any person to represent you during the appeal process so long as the person is willing and able to serve. You can also represent yourself. Typical representatives include private attorneys, union attorneys, and other union representatives. As an employee or supervisor working for a federal agency, it is important to know the rights and regulations concerning the Merit Systems Protection Board. 

 

 

Photo credit: Microsoft   

 

Sexual harassment and retaliation: a lesson learned the hard way by Fry’s Electronics

In late August, the Equal Employment Opportunity Commission (EEOC) won a huge case against Fry’s Electronics Inc. that should be turning employers’ heads nationwide. The Washington State litigation ended with a consent decree to the tune of $2.3 million dollars, one of the highest payouts on a per-claimant basis for any EEOC lawsuit.

Here are the facts:

Fry’s employed twenty-year-old America Rios as a sales associate. A supervisor started making advances, which she rebuffed. But soon, the supervisor was sending her sexually harassing text messages, so she sought help from her direct supervisor, Ka Lam. Mr. Lam took action, reporting the harassment to the legal department. Fry’s reacted by terminating Mr. Lam, citing a poor performance record—despite his usual positive reviews.

Enter the lawyers.

The EEOC brought suit for discrimination and retaliation for Mr. Lam, and similar charges for Ms. Rios. The Washington District Court permitted the EEOC to represent both parties in the same suit.

Fry’s lawyers were not happy, and engaged in questionable (at best) legal strategy. In its order imposing sanctions, the court expressed disgust for their legal tactics, calling Fry’s actions “unfair, unwarranted, unprincipled, and unacceptable.” The court also accused Fry’s of spoliating or destroying evidence relevant to the case.

In the end, the court sanctioned Fry’s with a $100,000 fine, and ordered payments to Mr. Lam and Ms. Rios of $1,564,000 and $736,000, respectively, in damages, attorney’s fees, and lost wages. Fry’s will also undergo mandated harassment trainings for two hours per employee, per year. The company will be closely monitored to ensure compliance with the standard expected from businesses nationwide.

Employers should learn from Fry’s mistakes. If an employee complains of harassment, supervisors must follow proper procedure or risk being thrown out of the frying pan and into the fire. Furthermore, destroying evidence is never a good idea. 

Religious discrimination and retaliation in the workplace: the EEOC steps in

A Muslim man from SeaTac, Wash., who claims he was fired from his job as a security guard after refusing to shave his beard, filed a federal lawsuit against his former employer.

Abdulkadir Omar, 22, began working in Kent, Wash., for California-based American Patriot Security in May 2009. He said no one told him when he was hired that he would have to shave his beard, which he keeps closely trimmed as part of his Islamic faith.

But six months later a supervisor told Omar he was required to shave, according to a lawsuit filed in U.S. District Court in Seattle last month against American Patriot. The lawsuit seeks compensation for 65 hours Omar said he worked and was not paid, as well as emotional and general damages.

Omar told the supervisor he was religiously obligated to keep his beard and continued to work at the company until April 2010, when he met with a regional project manager to discuss wages he hadn't received, according to the suit.
According to the lawsuit, when she saw his beard, that manager warned Omar that to continue working there he would have to shave it and comply with company policy, and Omar repeated that he was following his religious beliefs. Omar claimed other security guards at the company had beards and continued to work.

He contacted the Council on American-Islamic Relations, a national Muslim advocacy organization. The Northwest chapter of the council receives one or two calls a month from people who have a similar problem with an employer, said Jennifer Gist, a coordinator for the Seattle chapter of the council.Employers almost always change their stance after receiving a letter from the council citing the Civil Rights Act of 1964, which says employers must accommodate workers' religious practice unless it causes the employer undue hardship, Gist said.

But American Patriot never responded to the letter, Gist said, and Scott Jacobs, the company's CEO, told Omar he would be kept off the work schedule until he shaved, according to the lawsuit.
"Growing up in this country where the Bill of Rights guarantees freedom of religion, I was let down," Omar said. "What does my beard have to do with me doing my job?"

The Council on American-Islamic Relations then contacted the Equal Employment Opportunity Commission, the federal entity that enforces workplace anti-discrimination laws. The EEOC repeatedly attempted to contact American Patriot, but the company never responded, Gist said.
The EEOC determined in May that there was reasonable cause to believe the company had violated the Civil Rights Act through "discrimination and retaliation" against Omar, according to the lawsuit.

It's very rare that the EEOC finds such a violation and even more rare when they decide to put the full force of the law behind it, said Rudy Hurtado, a program analyst at the Seattle field office of the EEOC.Hurtado couldn't speak to Omar's case specifically, but said the commission is usually able to resolve an issue outside of court by discussing it with the company and employee.

"The employer has the obligation to accommodate religious beliefs. If the employer doesn't even do that, if they say, 'Nope this is the rule and we can't change it,' then we have a problem," Hurtado said.

 

OSHA expands whistleblower protection program

The whistleblower provisions laws enacted by Congress prohibit employers from retaliating against employees who raise various protected concerns or provide protected information to the employer or the government. “The ability of workers to speak out and exercise their legal rights without fear of retaliation is crucial to many of the legal protections and safeguards that all Americans value.”

Currently, the Occupational Safety and Health Administration (OSHA) enforces the whistleblower statutes that protect employees who report violations of various work place safety, airline, commercial motor carrier, consumer product, environmental, financial reform, food safety, health care reform, nuclear, pipeline, public transportation agency, railroad, maritime, and securities laws. As part of a continuing effort to improve the Whistleblower Protection Program, on August 1, 2011 OSHA announced that it is implementing additional measures to strengthen the program and is releasing a detailed review. These measures are anticipated to significantly strengthen OSHA’s enforcement of the whistleblower laws. 

The significant changes include several different measures. The first measure is restructuring to improve the administration and statute of the program. This includes requiring the Whistleblower Protection Program will report directly to the assistant secretary instead of being housed in the Directorate of Enforcement, as well as increasing the number of investigators. Another measure is increasing training by holding a national whistleblower training conference, as well as offering other investigator training events. 

OSHA will also issue a new edition of the Whistleblower Investigations Manual that updates current procedures and includes information on the new laws that have been enacted since the last update in 2003. The new manual will provide further guidance on the enforcement program to ensure consistency and quality of investigations. Lastly, the data collection system has been modified and the audit program strengthened and expanded to ensure complaints are handled in a timely manner. 

 

Photo credit: Microsoft

When may a defendant employer recover attorneys' fees?

In federal cases alleging discrimination, harassment, retaliation, and violations of civil rights, it is long settled that defendants may recover only when the plaintiff's claims are "frivolous, unreasonable or without foundation."  What about when some of the claims are frivolous?  

The Supreme Court answered that question, unanimously, with Justice Kagan writing the opinion:

Section 1988 allows a defendant to recover reasonable attorney’s fees incurred because of, but only because of, a frivolous claim. Or what is the same thing stated as a but-for test: Section 1988 permits the defendant to receive only the portion of his fees that he would not have paid but for the frivolous claim.

The court then went on to hold that if the defendant spends fees on issues that deal with both frivolous and nonfrivolous claims simultaneously, the defendant may not recover fees. Justice Kagan wrote, “but if the defendant would have incurred those fees anyway, to defend against non-frivolous claims, then a court has no basis for transferring the expense to the plaintiff…The basic American Rule thus continues to operate.”

Thus, the Supreme Court unanimously made sure that defendants will have a tough time recovering fees in cases including both frivolos and non-frivolous claims.  

 

Photo credit: Microsoft

 

Employer deemed to have interfered with Family Medical Leave Act (FMLA) benefits

A recent Federal District Court case out of Arkansas has potentially significant implications for employers regarding Family Medical Leave Act (FMLA) benefits. The Arkansas District Court recently ruled in Terwillinger  v. Howard Memorial Hospital that too much contact with an employee currently out on FMLA leave could be interpreted as interfering with the employee’s right to FMLA leave.

Regina Terwillinger worked as a housekeeper for Howard Memorial Hospital for approximately two years before requesting and being approved for FMLA leave for back surgery. During Ms. Terwillinger’s recovery, her supervisor contacted her weekly to determine when she was going to return to work. Terwillinger asked her supervisor if her job was in jeopardy due to her absence, to which her supervisor replied she should return to work as soon as possible.  

As a result, Terwillinger felt pressured to return to work sooner than she had planned.  Less than a month after returning, Terwillinger was fired for theft. Terwillinger filed suit against the hospital alleging violations of the FMLA for retaliatory discharge and interference. She also argued in her suit that the hospital denied her the full benefit of the FMLA when it pressured her to return to work while she was on FMLA leave.

Although the Court rejected Terwillinger’s retaliation claim, it ruled there was enough evidence of FMLA interference for the case to go forward. Under FMLA, employers are prohibited from “interfering with, restraining or denying an employee’s exercise or attempted exercise of any right contained in the FMLA.” The court further indicated that “an employer’s action that deters an employee from participating in protected activities constitutes an interference of the employee’s exercise of his or her rights.” 

The “chill theory,” adopted by numerous courts, indicates a “chilling” of FMLA rights is sufficient for an FMLA interference claim. The court indicated that “a reasonable jury could conclude that the hospital interfered with Terwillinger’s exercise of her FMLA rights by discouraging or chilling her exercise of those rights.”
In light of this recent ruling, employers should avoid too much communication with employees during FMLA leave. Although many employers may be genuinely concerned with their employees’ welfare, they should be mindful that their contact could be interpreted as threatening or applying pressure to return. Getting a clear indication of the length of the leave from the employee beforehand is a good way to avoid potential miscommunication. 

Once employers know the employee’s expected return date, they should not contact the employee until about a week or so before his or her expected return. In addition, direct supervisors should not contact employees directly. Asking human resources personnel to contact the employee is a good way to buffer the communication. Finally, employers should be advised to speak carefully when discussing returning to work with an employee on FMLA leave in order to avoid misinterpretation of their intent.