Merry Christmas

To all of my readers who have made the first 7 months of the Ohio Employer's Law Blog such a success, and to those who have simply stumbled upon me by happy accident or random Google search, happy holidays and merry Christmas. Now put the mouse down, stop thinking about employment law, and enjoy your holiday. I'll be back on Boxing Day.

NLRB rewrites employee solicitation rules

It is no secret that employers often use non-solicitation policies as a lawful means to limit union activities on company time and property. Last week, the NLRB delivered an early Christmas gift to employers. Register-Guard, decided 3-2 by the Board, signaled a strong victory for an employer's right to control its computer and e-mail system, and at the same time severely restricted an employee's ability to solicit using company property.

Register-Guard is a unionized newspaper publisher. In 1996, it began installing a new computer system. Around the same time it also implemented a new Communications Systems Policy ("CSM"), which governed employees' use of its communications systems, including e-mail. The policy stated, in relevant part:

Company communication systems and the equipment used to operate the communication system are owned and provided by the Company to assist in conducting the business of The Register-Guard. Communications systems are not to be used to solicit or proselytize for commercial ventures, religious or political causes, outside organizations, or other non-job-related solicitations (emphasis added).

Despite the policy, the company allowed its employees to send and receive personal e-mails, such as such as baby announcements, party invitations, and the occasional offer of sports tickets or request for services such as dog walking. However, it never allowed solicitations regarding any outside agency other than the United Way. The employer gave two warnings to an employee who sent three union-related e-mails, which lead to the charge that the employer was discriminatorily enforcing the policy.

In ruling that the policy, on its face, did not violate the NLRA, the Board relied upon an employer's legitimate business interest in its "basic property right to regulate and restrict employee use of company property," including its computer system. The Board saw no distinction between a traditionally bulletin board and an e-mail system:

[T]he Respondent's CSP does not regulate traditional, face-to-face solicitation. Indeed, employees at the Respondent's workplace have the full panoply of rights to engage in oral solicitation on nonworking time and also to distribute literature on nonworking time in nonwork areas.... What the employees seek here is use of the Respondent's communications equipment to engage in additional forms of communication.... "Section 7 of the Act protects organizational rights ... rather than particular means by which employees may seek to communicate."

A solicitation or other communication policy can lawfully bar employees' non-work related use of an employer-owned e-mail system or other property, unless, on its face, it discriminated against employees' exercise of Section 7 rights. Thus, a policy that prohibits employee use of an e-mail system for "non-job-related solicitations" does not violate the NLRA.

Along the same lines, the Board found that "discrimination" in the context of rules limiting employee solicitations means drawing a specific distinction along Section 7 lines. In the Board's words:

Thus, in order to be unlawful, discrimination must be along Section 7 lines. In other words, unlawful discrimination consists of disparate treatment of activities or communications of a similar character because of their union or other Section 7-protected status. For example, an employer clearly would violate the Act if it permitted employees to use e-mail to solicit for one union but not another, or if it permitted solicitation by antiunion employees but not by prounion employees.

This case concerned two different sets of e-mails. In the first, an employee called employees to take action in support of the union (such as wearing certain clothing and participating in a parade). While the employer tolerated personal employee e-mails (baby announcements, etc.), there was no evidence that the employer permitted employees to use e-mail to solicit for specific groups or causes. Thus, disciplining the employee for this set of e-mails did not discriminate along Section 7 lines, because the CSP did not permit any group or cause related solicitations. The second set of e-mails, however, presented a different problem. Those were not a solicitation or some call for collection action. Instead, they merely clarified the facts surrounding a union rally. Because the CSP only prohibited non-work-related "solicitations," and because the company permitted a wide range of non-work-related e-mails, disciplining the employee for an e-mail that disseminated information about the Union (as opposed to soliciting some action on its behalf) did discrimination along Section 7 lines and therefore violated the NLRA.

For employers, non-solicitation policies are always tricky. Now, the Board has given employers broad latitude to draft and enforce such policies, even as to e-mail communications, to bar all non-work-related solicitations. Further, enforcement is only a problem if it draws a clear line between Section 7 activities. While future Board and Court decisions will further flush out these standards, for now it is safe to say that non-solicitation and computer use policies will have to be reviewed, rewritten, and most likely broadened in light of this case and its new discrimination standards.

(Hat tip to the Pennsylvania Employment Law Blog).

Department of Labor investigations highlight important wage and hour compliance issues

Today's Cleveland Plain Dealer reports that the U.S. Department of Labor has found that housekeepers working in Ohio hotels are routinely underpaid. Indeed, in wage and hour audits conducted in 2007, the DOL reports that only 28% were in full compliance with federal wage and hour laws. As a result, it has promised "a 'significant' number of hotel investigations in 2008 and reinvestigations of some of the employers it already found in violation of wage requirements," according to the PD.

Speaking from experience, the DOL audits companies in one of three instances: randomly (which seldom happens), after receiving a complaint, or as part of a targeted initiative against a particular industry or class of businesses. These hotel investigations fall into the latter category.

If you find yourself being audited, the DOL will examine your wage and hour records for the past two years to ensure that all non-exempt employees have been paid at least minimum wage and overtime for all hours worked in excess of 40. It will also look at child labor issues if you employ any minors. The DOL may examine whether salaried employees are properly classified as exempt. Finally, it may interview employees to gather additional information. It will then make recommendations for changes, and try to reach a resolution as to any back overtime and wages. If the employer fails to cooperate, or is a repeat offender, it may request that the Solicitor General's office file an enforcement action in federal district court.

There is no way to prevent an audit from occurring, but you should self-audit your company's wage and hour practices to help get a clean bill of health if the DOL calls. Look at your personnel, payroll, and time records to make sure your are retaining everything the FLSA requires. Reevaluate positions and job descriptions for proper exemption classifications. It should go without saying that if you are not paying minimum wage, or overtime to non-exempt employees, start doing so immediately. With the new year quickly approaching, I'd like to see all businesses make a resolution to get their wage and hour practices in order during 2008.

What else I'm reading this week #10

We'll start this week with a couple of posts on issues surrounding the drafting and enforcement of employment agreements:

Jottings by an Employer's Lawyer lists the 8 parts of an executive employment agreement.

Suits In The WorkPlace gives some sage advice on how to draft solid non-compete agreements. The discussion is under Illinois law, but the principles transfer well to Ohio law.

On other topics:

Dan Schwartz at the Connecticut Employment Law Blog draws some lessons from his recent middle school mock trial coaching, and recommends that to avoid employment law issues, HR should keep things simple.

The Evil HR Lady gives some advice on how to handle a job applicant's prior criminal conviction. As long as the policy is neurally applied (i.e., disqualifying anyone with a conviction other than a traffic offense), you should not run into any problem using conviction histories in employment decisions. Arrest records are another story, because arrests may disparately impact one race over another.

Should you fail to hire someone and end up defending an administrative charge, the Pennsylvania Employment Law Blog tells us 5 things every HR generalist should know in responding to EEOC and state agency discrimination charges. Let me add #6 - call your employment counsel.

John Phillips, at The Word on Employment Law, has posted the 2nd half of his excellent 6-part series on the art of firing employees. (Part IV, Part V, and Part VI).

In the wake of the debacle over the proposed maternity leave regulations, the Ohio Practical Business Law Counsel asks, "Where is the Ohio Civil Rights Commission going?"

Finally, the Wall Street Journal's Law Blog asks the self-evident question of whether the jury trial is an endangered species.

Some more shameless promotion

I commend to everyone's reading an article in this week's Business Insurance on the Huber v. Wal-Mart case that the Supreme Court last week decided to hear - High court to hear case on ADA job applicants. I has a collection of quotes from lawyers all over the country predicting how the Court will rule, including me:

Jonathan T. Hyman, an employer attorney with Kohrman, Jackson & Krantz P.L.L. in Cleveland, said he expects the court to rule in Wal-Mart's favor.

"I think it would be a dangerous precedent to write affirmative action into the ADA by saying you don't have to hire the most qualified person for a position," said Mr. Hyman. Hiring the most qualified person is "one of the cornerstones of employment law," he said.

Ohio Supreme Court holds that no wrongful discharge claim exists for employee terminated while on workers' comp leave

Four months ago, I reported on Klopfenstein v. NK Parts Industries, Inc., an Ohio appellate decision which held that Coolidge v. Riverdale Local School Dist. created an independent public policy exception to the employment at-will doctrine. Klopfenstein stood in direct contrast to other Ohio appellate districts, such as Cuyahoga County in Brooks v. Qualchoice, which held that Coolidge does not create a new public policy exception to the employment at-will doctrine, but instead illustrates conduct that is retaliatory under R.C. 4123.90 (the workers' comp anti-retaliation provision). At that time, I predicted that given the conflict, the Ohio Supreme Court would soon be asked to revisit this issue, and that it should reject the Klopfenstein line of cases:

Klopfenstein will not be the last word on this issue. Whether in an appeal from that case, or some future case, the Ohio Supreme Court will be called upon to clarify its Coolidge holding and definitively state the proper statute of limitations. In anticipation of that future battle, let me suggest that Klopfenstein was wrongly decided. R.C. 4123.90 states: "No employer shall discharge ... any employee because the employee filed a claim ... under the workers’ compensation act for an injury ... which occurred in the course of and arising out of his employment with that employer." If an employee is terminated because of workers' comp-related absences, that employee is being terminated because of the claim. Thus, the termination falls squarely within the coverage of R.C. 4123.90. It is the job of the legislature, and not the courts, to expand the statute of limitations for Coolidge claims if it sees fit to do so.

Today, the Ohio Supreme Court has proved me to be both prescient and correct. In Bickers v. W. & S. Life Ins. Co., the Court has held: "An employee who is terminated from employment while receiving workers' compensation has no common-law cause of action for wrongful discharge in violation of the public policy underlying R.C. 4123.90, which provides the exclusive remedy for employees claiming termination in violation of rights conferred by the Workers' Compensation Act." In so ruling, it greatly limited the reach of its 2003 Coolidge decision, limiting Coolidge to considerations of "good and just cause" for termination under R.C. 3319.16 (which involves terminations of contracts by boards of education). The Court explained its rationale for limiting employees to a statutory claim under the workers' comp retaliation provision:

The policy choice between permitting and prohibiting the discharge from employment of an employee who has been injured at work is a difficult one, as it inevitably creates a burden of some degree upon either the employer or the employee.

Should the policy choice be to deny employers the exercise of their employment-at-will prerogative and require them to hold open the jobs of injured employees for indefinite periods of time, then employers will be burdened with employees unable to perform the work for which they were hired and an inability to obtain permanent replacements. This would be particularly onerous on small employers with few employees, who lack the ability to shift the duties of an injured employee to other employees.

Should the policy choice be to permit an employer to terminate a worker who is injured on the job and cannot work as a result, then the worker suffers not only the burden of being injured but also the burden of unemployment at a time when seeking a new position is made more difficult by the injury.

In addressing this difficult policy issue, which lacks wholly satisfactory solutions, the General Assembly chose to proscribe retaliatory discharges only. Employers may not retaliate against employees for pursuing a workers’ compensation claim. R.C. 4123.90. It is within the prerogative and authority of the General Assembly to make this choice when determining policy in the workers' compensation arena and in balancing, in that forum, employers' and employees' competing interests. We may not override this choice and superimpose a common-law, public-policy tort remedy on this wholly statutory system.

In holding the employee to the statutory remedy, the Court continued its string of recent opinions limiting the scope of Ohio's wrongful discharge tort (see Ohio Supreme Court rejects common law wrongful discharge age discrimination claim). What is becoming more and more clear under Ohio law is that if a statute provides a remedy that an aggrieved employee can take advantage of, that employee will not have a valid common law wrongful discharge claim.

The Bickers opinion is also interesting for the debate between the majority and the minority on the actual holding of Coolidge and whether the Court is merely clarifying its prior holding, or outright reversing binding precedent. That debate, while interesting from a jurisprudential standpoint, is ultimately immaterial to the practical impact of Bickers for companies: employers no longer have to hold jobs open in perpetuity for employees who are off work because of a workers' comp injury. The FMLA and the ADA, where applicable, will still have something to say about the duration of a medical leave of absence (see ADA may require leaves of absence beyond FMLA mandates), but at least as to the workers' comp law employees are limited to their statutory remedy and the 180-day statute of limitations that goes along with it.

Offensive comments are not just for proof of direct evidence

Today, we are going to play a little game. The following is an excerpt from Vincent v. Brewer Company, a sex discrimination case decided by the 6th Circuit. So that you can follow along: Brewer Company, the employer, lays natural gas pipes; Jama Vincent, the plaintiff, was demoted from a crew leader position to a laborer position, and was laid-off (even though replaced by a man) 7 months later for lack of work and failure to follow company rules; Ken Parker was Vincent's immediate supervisor and the decisionmaker who laid her off; Sal Dilillo is another supervisor and a peer of Ken Parker; Jay Fetters and Kevin Parker are crew leaders who reported to Ken Parker. After reading the following excerpt, decide whether the employee or the employer won the case:

Vincent and other former Brewer employees testified that members of Brewer’s management team frequently made degrading comments regarding the capabilities of female employees, and expressed a desire to rid the Utility Division of their presence. Among the remarks alleged to have been made by Brewer management are the following:

(1) Ken Parker stated that he believed that women do not belong at Brewer and that he would not hire them.

(2) Kevin Parker told a crew leader, Ronald Ayres, that he did not permit his female laborers to do any work aside from directing traffic and that Ken Parker would fire Ayres if he discovered Ayres allowing female laborers to perform any other task.

(3) Ken Parker told a female employee, Tina Updike, that the only jobs available to women at Brewer were those involving traffic direction.

(4) Kevin Parker told Vincent and another female employee, Tammy Ayres, that Ken Parker instructed him to only permit female laborers to direct traffic.

(5) Kevin Parker told Tammy Ayres that she could not be in charge of a project because women are "not leaders" at Brewer.

(6) Ken Parker told Tammy Ayres that "the problem with you is you're a f***ing woman."

(7) Kevin Parker stated that Dilillo disliked women even more than Ken Parker, and that Dilillo wanted to remove all of the Utility Division’s female employees because they made it look bad.

(8) Fetters frequently referred to Tammy Ayres using nicknames such as "sweetheart" and "cupcake," and often asked female employees graphic sexual questions.

(9) Ken Parker told Updike that if she wanted to earn a man's pay then she would have to work like a man or she would be replaced by a man.

Okay, that wasn't meant to be a trick question, and hopefully its obvious from that litany of offensive comments that Vincent won her appeal. What interesting about this case, though, is that despite all of those offensive comments, many attributable to the decisionmaker, and all attributable to high-level officials with managerial authority over the decision, this case was not treated as a direct evidence case, but decided under the McDonnell Douglas burden shifting analysis. In fact, the actual legal holding of the case is: "To establish a prima facie case of gender discrimination, ... a plaintiff who can prove that she was replaced by a member of the opposite sex need not show that she possesses qualifications similar to those of her replacement." The district court erred by requiring Vincent to show that her replacement was outside of the protected class and similarly qualified as her. The latter is simply not part of the prima facie case.

Many of the offensive comments could be subject to exclusion in a direct evidence case because they may not have a sufficient nexus to the at-issue termination decision. However, in this case they were used as part of the pretext analysis, to show that Brewer's legitimate non-discriminatory reason did not actually motivate the discharge. The lesson to take away from this case is that courts will hold you to your legitimate non-discriminatory explanations, and evidence that might otherwise be excluded as unrelated to the challenged decision will become relevant to show pretext and rebut that explanation.