What else I'm reading this week #12

Last week I reported on Arbino v. Johnson & Johnson, in which the Ohio Supreme Court upheld the constitutionality of Ohio's tort reform legislation. Teri Rasmussen at the Ohio Practical Business Law Counsel provides a detailed examination of the opinion. She also questions my supposition that tort reform does not apply to discrimination claims. So that my conclusion is clear, in light of the Ohio Supreme Court's recent narrowing of the public policy tort, discrimination claims under Ohio law are now almost certainly purely statutory. Because they present statutory claims, any caps on damages for those claims would have to come from an amendment to the statute. There are a host of non-statutory employment tort claims (defamation, intentional infliction of emotional distress, tortious interference, to name a few) that are impacted by the tort reform caps on damages.

On to other matters.

Kris Dunn, The HR Capitalist, always an excellent resource, writes about the NLRB's Register-Guard decision, and concludes that it stinks to have to say no to girl scout cookies to keep unions out of your workplace.

If a union does come knocking, Guerilla HR gives some helpful advice on what to do and what not to do in response. Most importantly, do not threaten or intimidate employees about their union support.

John Phillips' Word on Employment Law discusses employee privacy rights (or lack thereof) in off-work, personal Internet activity. For my thoughts on this issue, see Can employers base employment decisions on employees' personal Internet activities? As a bonus, John gives us a very thorough crib sheet covering the Presidential candidates' positions on various labor and employment issues.

Finally, Michael Moore at the Pennsylvania Employment Law Blog draws some good lessons from yesterday's reported $2.5 million settlement by the EEOC on behalf of one employee for a racial harassment claim. According to the EEOC's press release, the now wealthy employee was the target of repeated verbal abuse by coworkers and a supervisor, including calling him the "N-word" and saying "we should do to blacks what Hitler did to the Jews." For the company's part, it failed to discipline the harassers and instead allowed the discrimination to continue unabated even though it was aware of the unlawful conduct. I'm as against this type of conduct as anybody, but $2.5 million? Seems awfully excessive for someone who was subjected to words, no matter how offensive they might be.

"Maternal Profiling" listed as buzzword of 2007

With the calender barely having turned to 2008, I'm still catching up reviewing year end lists for 2007. One list, the New York Time's Buzzwords of 2007, should be of particular interest to employment lawyers, employers, and HR personnel. It lists "maternal profiling" as one of the phrases that took its place in the national conversation for 2007. Maternal profiling is defined as:

Employment discrimination against a woman who has, or will have, children. The term has been popularized by members of MomsRising, an advocacy group promoting the rights of mothers in the workplace.

A trip over to MomsRising.org reveals some frightening statistics about the workplace impact of maternal profiling. It cites one study which found that mothers are 79% less likely to be hired than non-mothers with equal resumes and job experiences. It cites another study that women without children make 90% as compared to a comparable man, as compared to 73% for women with children and 60% for single moms. It cites one final study that mothers were offered $11,000 less in starting pay than non-mothers with the same resumes and job experience, while fathers were offered $6,000 more.

I've spent a lot of time this year writing about family responsibility discrimination in light of the EEOC's recent enforcement guidance on the subject, and the $2.1 million verdict against Kohl's Department Stores for repeatedly passing over a qualified mom for promotion. Maternal profiling may have been one of the buzzwords of 2007, but it certainly appears that family responsibility discrimination is going to be a key employment issue in 2008 and beyond. Depending on how the political winds blow after the November elections, FMLA expansion, paid sick and parental leave, and incentives for family-friendly work programs will all be in play in 2009.

I am not suggesting that everyone rewrite their leave policies, but those who can afford to be family-friendly will have an advantage in recruiting and retention of employees for whom it is an important benefit (i.e., most people between the ages of 25 and 50). At a minimum you should be building the concept of maternal profiling into your harassment and EEO/diversity training. Discrimination in largely subconscious, and education is the first step towards prevention.

Hat tip to Carrie Kurzon at the New York Employment Lawyer Blog.

An argument for broader protection of confidential and proprietary information

Nelson Jewellery Arts Co. v. Fein Design Co., out of the 9th District Court of Appeals, involves two companies fighting over what we can only assume is a key employee. As is often the case in such disputes, the old employer claimed that the employee took with him to the new employer certain confidential and proprietary information, such as pricing and customer information. The appellate court, however, rejected the claim because the information did not meet the statutory definition of a "trade secret." It was readily ascertainable by other means such as telephone books and trade publications, and the company did not take reasonable measures to maintain the secrecy of its alleged confidential information. Therefore, the claim was dismissed. In so ruling, the court rejected any common law protection over the information, and limited the law's reach to that narrow category of corporation information that meets the specific statutory definition of a "trade secret" pursuant to O.R.C. 1333.61(D):

(D) "Trade secret" means information, including the whole or any portion or phase of any scientific or technical information, design, process, procedure, formula, pattern, compilation, program, device, method, technique, or improvement, or any business information or plans, financial information, or listing of names, addresses, or telephone numbers, that satisfies both of the following:

(1) It derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use.

(2) It is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

This case raises the question of what corporate information should the law protect. Is is just information that meets the statutory definition of a trade secret, or is some broader category of information worthy of legal protection? It seems that companies should be able to stop employees from walking out the door with corporate information whether or not such information qualifies as a trade secret. After all, that which a company creates is its property, and it should be able to prevent its disclosure to or use by a competitor. Limiting such protection merely to "trade secrets" is overly restrictive, and ignores the property interest that businesses have in their documents, data, and other information.

How do we help put ourselves in the best position to protect stuff that may not meet the high threshold of a trade secret? Let me make a few suggestions:

1. Put provisions in employee handbooks that define the scope of the company's property - not just as trade secrets, but as all confidential and proprietary information, and everything that is created by or for the company.
2. Separate and apart from the employee handbook, have all employees who will come in contact with any information you might want to protect sign an agreement that defines what belongs to who, and specifically sets forth the company's right to the information at the end of employment.
3. When an employee leaves, have that employee sign a receipt that all company property and information has been returned, and that the employee is not taking anything with him or her. Where the separation is not voluntary, it may not always be easy to have the employee sign something on his or her way out the door. In that case, you can still protect yourself by sending the employee a certified letter reminding him or her of the corporate policy and their agreement to it.
4. If you think the ex-employee is not being forthcoming with you, correspond with the new employer, placing it on notice that you will hold it responsible for any of your information that is in its possession.
5. When all else fails, litigate. Bear in mind, however, that adherence to steps 1 - 4 will put you in a much better light should you have to litigate to seek protection over your information, whether or not it qualifies as a trade secret.

9th Circuit creates new affirmative defense under the ADA

Earlier this month I reported on the EEOC's Fact Sheet on Employment Tests and Selection Procedures. United Parcel Service provides an example of one such screening criteria, and gives some hope to employers who use medical or other criteria to screen out certain disabled employees.

UPS imposes a Department of Transportation hearing standard on all package-car drivers, even though the standard only applies to those who drive vehicles over 10,000 pounds. UPS disqualifies from employment any employee or applicant who cannot meet that standard, whether or not the vehicle that individual will operate is over or under the 10,000 pound threshold. Last week, the 9th Circuit, in Bates v. United Parcel Service, reversed a lower court, which had held that application of the standard to those who do not drive covered vehicles violated the ADA.

Section 12113(a) of the ADA makes it a defense to a disability discrimination claim "that an alleged application of qualification standards, tests, or selection criteria that screen out or tend to screen out or otherwise deny a job or benefit to an individual with a disability has been shown to be job-related and consistent with business necessity, and such performance cannot be accomplished by reasonable accommodation." This defense breaks down into three elements: 1) job-relatedness; 2) consistent with business necessity; and 3) that job performance cannot be accomplished by reasonable accommodation.

As evidence of the lawfulness of its hearing qualification standard, UPS offered up the DOT standard to show that a certain level of hearing is necessary to safely drive even non-DOT-regulated vehicles. The 9th Circuit found the 10,000 pound threshold irrelevant to whether UPS could lawfully rely on the DOT safety standard as a qualification standard for all driver positions:

To be sure, DOT's regulation does not apply to the category of vehicles at issue in this case. However, that circumstance does not mean that the standard has no relevance to the employer's safety argument. UPS is entitled to use as some evidence of its business necessity defense the fact that it relied on a government safety standard, even where the standard is not applicable to the category of conduct at issue.... Thus, while certainly not dispositive of UPS's showing of job-relatedness, business necessity or the reasonableness of potential accommodations, UPS's reliance on the government safety standard with respect to other vehicles in its fleet should be entitled to some consideration as a safety benchmark.

Thus, employers are entitled to rely on objective safety criteria (such as governmental regulations) as a qualification for a position, even if the at-issue regulations are not mandated for the specific position. Such reliance, however, is not dispositive as to the lawfulness of the qualification. Instead, one must examine the congruence between the safety standard and the position to which it is being applied. In other words, is there a bona fide, demonstrable correlation between the standard and performance of the essential functions of the position?

While this decision does not bind companies in Ohio, it should give employers everywhere some solace that objective screening criteria will not necessarily be found to be discriminatory, even if they effectively screen out from consideration for a position all disabled applicants and employees. It also lets employers know that they can employ reasonable selection criteria and safety standards without fear of necessarily being second-guessed by a court.

My New Year's resolutions for everyone

While it may be trite, the approach of a new year causes us to reflect on the past year and make some resolutions on how to better ourselves for the coming year. While we generally think of these resolutions in personal terms, it makes sense also to think of them from an organizational viewpoint. With that in mind, let me suggest some resolutions for your employment practices to make 2008 a better, more compliant year than 2007:

1. Review your employee handbooks and other personnel policies.
2. If it's been longer than 2 years since you did company-wide harassment training, schedule it for 2008.
3. Make sure you are using the new I-9 form for all new hires.
4. Audit your wage and hour practices.
5. Make a concerted effort to document all discipline and performance problems.
6. Do not make promises to your employees that you cannot keep.
7. Make hiring and firing decisions based on performance.
8. Be more understanding of your employees' family responsibilities outside of the office.
9. Employ the golden rule - treat your employees as you would want to be treated.
10. Above all else, try to have some fun at work.

My hope for everyone (except me) is that 2008 brings no lawsuits, no EEO charges, no sexual harassment complaints, no wage and hour audits, and no disgruntled employees. Be happy and be safe, and I'll see everyone in 2008.

President Bush expected to veto FMLA expansion

In what can only be described as a surprising turn of events, and in a lesson that would make any grade school civics teacher proud, President Bush is expected to use a pocket veto to kill the National Defense Authorization Act for Fiscal Year 2008. That bill includes an expansion of FMLA leave rights for the families of wounded service members. A couple of weeks ago, I reported that the President would be hard pressed to veto a bill that authorized $696 billion in military programs. Now, as the New York Times is reporting, the White House has stated that the President will veto the bill. At issue is one specific section over which the Iraqi government is concerned that Iraqi assets in American banks could be vulnerable to claims from victims of Saddam Hussein.

Given the overwhelming majority this bill passed both the House and Senate, one could assume that these issues will be resolved after Congress resumes in the new year. I'm done making predictions about this legislation, however, after my last prediction turned out to be wrong. All I can is to watch this space for further updates about this potential expansion of FMLA rights.

Hat tip to the Connecticut Employment Law Blog.

What else I'm reading this week #11

Given the mid-week holiday, it's still been pretty active in the blogosphere. As always, please take the time to click through these links and support my fellow employment law and HR bloggers.

John Phillips' The Word on Employment Law reports on a story that's had a lot of traction this week, Wikipedia's failure to discover the criminal history of its former COO, and draws some important lessons on the importance of conducting background checks for critical positions.

HR World blogs on how to handle bullying bosses. You can also read my thoughts on this issue here: Sticks and stones may break my bones...

The Manpower Employment Blawg draws some important lessons on FMLA leaves of absence from a case which held that formal notice is not necessary for an employee to be entitled to FMLA leave.

Finally, Texas' HR Lawyer's Blog discusses some employment law pitfalls that await those who carelessly e-mail.