Ohio Supreme Court rules that employers do not have to provide pregnant employees greater leave rights than non-pregnant employees

Yesterday, the Ohio Supreme Court handed businesses a huge victory on the issue of pregnancy leave rights.

Pataskala Oaks Care Center had a written policy that required all employees to work for a year before becoming eligible for leave for any reason. It fired Tiffany McFee three days after she gave birth because she was absent from employment before she had become eligible for leave under that policy. McFee sued for sex discrimination. The court of appeals held that Ohio’s antidiscrimination laws require that employers provide employees with a reasonable period of maternity leave, and the at-issue policy that denied McFee leave was direct evidence of sex discrimination.

In McFee v. Nursing Care Mgmt. of Am. (6/22/10) [pdf], the Ohio Supreme Court disagree, and held:

An employment policy that imposes a uniform minimum-length-of-service requirement for leave eligibility with no exception for maternity leave is not direct evidence of sex discrimination….

In reaching this decision, the Court pointed out that the pregnancy discrimination laws do not require preferential treatment for pregnant employees. They merely mandate that employers treat pregnant employees the same as non-pregnant employees who are similarly situated with respect to their ability to work. Because the at-issue length-of-service requirement is pregnancy-blind—it treats all employees the same by requiring every employee to 12 months of employment before becoming eligible for leave—it is not direct evidence of sex discrimination.

The court also harmonized Ohio’s pregnancy discrimination regulations on mandatory maternity leave—Ohio Adm. Code 4112-5-05(G)(2) and (G)(5).

• (G)(2) provides: “Where termination of employment of an employee who is temporarily disabled due to pregnancy or a related medical condition is caused by an employment policy under which insufficient or no maternity leave is available, such termination shall constitute unlawful sex discrimination.”
  
• (G)(5) provides: “Women shall not be penalized in their conditions of employment because they require time away from work on account of childbearing. When, under the employer’s leave policy the female employee would qualify for leave, then childbearing must be considered by the employer to be a justification for leave of absence for female employees for a reasonable period of time. For example, if the female meets the equally applied minimum length of service requirements for leave time, she must be granted a reasonable leave on account of childbearing.”
  

The Court recognized the potential tension between these two provisions. (G)(2) appears to indicate that a policy providing no leave is discriminatory, while (G)(5) states that a uniform minimum-length-of-service requirement for leave eligibility is permissible. But:

Reading these rules in light of the statutory purpose, Ohio Adm.Code 4112-5-05(G)(2) must mean that when an employee is otherwise eligible for leave, the employer cannot lawfully terminate that employee for violating a policy that provides no leave or insufficient leave for temporary disability due to pregnancy or a related condition…. This interpretation of the rule harmonizes (G)(2) with (G)(5), which specifies that when a woman qualifies for leave, the leave provided for childbearing must be reasonable.

Thus, an employer may terminate a pregnant employee who has not yet met a minimum-length-of-service requirement under a neutral leave policy. There are a three key takeaways for employers from this case.

1. Leave policies must be neutral. An employer cannot have a maternity leave policy with a length-of-service requirement, and a different leave policy for other situations with no length-of-service requirement, or one of a shorter duration.
   
2. Employers do not have to offer maternity leave to employees. However, if leave is offered for any reason, it must include maternity leave in at least the same amount and on the same conditions as other types of leave.
   
3. Merely having a neutral policy does not grant an employer carte blanche to terminate pregnant employees or new moms. The policy must still be applied equally to all employees with similarly disabling conditions. If new-employee Bill in accounting needs six weeks off to recover from back surgery, you cannot let Bill take the time unless you are prepared to similarly ignore the length-of-service requirement for all pregnant employees. Otherwise, you are opening yourself up to a claim of pretext—that the application of the facially neutral policy is a pretext for pregnancy discrimination.

DOL permits FMLA leave for gay parents (and others too)

The Internet has been ablaze with news that the Department of Labor would be expanding the rights of gay workers to take FMLA leave to care for sick or newborn children of same-sex partners (but not for each other). The change comes in the form of Wage & Hour Division Administrator’s Interpretation No. 2010-3. This Interpretation clarifies the definition of “son or daughter” under the FMLA as it applies to an employee standing “in loco parentis” (that is, one assuming the obligations of a parent without the legal formalities of an adoption) to a child.

The FMLA entitles an employee to 12 workweeks of unpaid leave for the birth or placement of a son or daughter, to bond with a newborn or newly placed son or daughter, or to care for a son or daughter with a serious health condition. The definition of “son or daughter” under the FMLA includes not only a biological or adopted child, but also a “foster child, a stepchild, a legal ward, or a child of a person standing in loco parentis.” According to the DOL, “Congress stated that the definition was intended to be ‘construed to ensure that an employee who actually has day-to-day responsibility for caring for a child is entitled to leave even if the employee does not have a biological or legal relationship to that child.’”

Here’s the key language expounding upon the coverage of FMLA-leave:

It is the Administrator’s interpretation that the regulations do not require an employee who intends to assume the responsibilities of a parent to establish that he or she provides both day-to-day care and financial support in order to be found to stand in loco parentis to a child.  For example, where an employee provides day-to-day care for his or her unmarried partner’s child (with whom there is no legal or biological relationship) but does not financially support the child, the employee could be considered to stand in loco parentis to the child and therefore be entitled to FMLA leave to care for the child if the child had a serious health condition.  The same principles apply to leave for the birth of a child and to bond with a child within the first 12 months following birth or placement…. 

Where an employer has questions about whether an employee’s relationship to a child is covered under FMLA, the employer may require the employee to provide reasonable documentation or statement of the family relationship. A simple statement asserting that the requisite family relationship exists is all that is needed in situations such as in loco parentis where there is no legal or biological relationship.

Based on this interpretation of in loco parentis, the FMLA covers:

• An employee who will share equally in the raising of an adopted child with a same sex partner, but who does not have a legal relationship with the child.
  
• An employee who will share equally in the raising of a child with the child’s biological parent.
  
• Stepparents.
  
• Where a grandparent or other relative takes in a child and assumes ongoing responsibility for raising the child because the parents are incapable of providing care.
  

While the rights of same-sex partners have garnered all of the attention, this Administrator’s Interpretation actually goes further by expounding upon the definition of in loco parentis. The publication of this Interpretation is a good excuse for employers to review FMLA policies to ensure that coverage for parental rights is up to date.

Do you know? Does mandatory arbitration of employment disputes work?

Yesterday, in Rent-A-Center v. Jackson [pdf] the U.S. Supreme Court held that the issue of the enforceability of an arbitration agreement should be decided by the arbitrator and not by a court. As fellow employment Dan Schwartz, of the Connecticut Employment Law Blog, tweeted moments after the decision’s announcement, “SCOTUS continues to heart arbitration provisions in employment cases.”

The bigger question, though, is whether employers should continue to heart arbitration of employment cases. The Winter 2010 edition of the ABA Journal of Labor & Employment Law has an article entitled Is Mandatory Employment Arbitration Living up to Its Expectations? A View from the Employer’s Perspective, by Charles Coleman, in-house counsel at Raytheon. Mr. Coleman argues that many companies are not all that satisfied with choosing mandatory arbitration of their employment disputes.

One of Mr. Coleman’s central arguments is that arbitration may not be faster or less expensive than traditional litigation. And, he has the numbers to bear this out. In a study of 19 recent employment cases filed against one company, Mr. Coleman discovered that arbitration is 30% more expensive and takes nearly 25% longer:

• The average costs and fees in an employment arbitration were $102,338, as compared to $70,491 in litigation.
  
• The average life cycle of an employment arbitration, from filing to decision, was 21 months, as compared to 17 months in litigation.
  

While this is a small sample-size, it at least illustrates that the premise that arbitration is a quicker and cheaper way to resolve employment disputes may be faulty. Aside from expense-control and speed-of-resolution, the other reason that employers favor employment arbitrations is to guard against runaway jury verdicts. But, if the premise is faulty as to cost and speed, then businesses should be questioning whether there are other ways to insure against juries.

To this end, let me suggest that instead of arbitration agreements businesses consider implementing jury trial waivers as a condition of employment. A jury trial waiver agreement both eliminates the risk of a runaway jury’s high damage award, and also preserves all appeal rights that arbitrations virtually eliminate.

There is no hard and fast answer to whether your business would be better served by arbitrations, bench trials, or some other solution. But, there are options other than the conventional wisdom that businesses should be arbitrating their employment claims.

Texting does not make you a bad parent

A day late, but here’s a Fathers’ Day message from Louis C.K. (maybe the funniest human being the planet) that explains how texting while spending time with your kids makes you a good dad:

Louis C.K. on Father’s Day (and, if you’re familiar with Louis, this is from CBS News, and totally safe for work).

Back to more substantive stuff tomorrow.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

WIRTW #131

Each and every week, there seems to be a breaking story that I just can’t get to, and there’s a half-dozen other bloggers who’ve already said all there is to say about it. This week proved no exception. On Wednesday, the Department of Labor issued the second Administrator’s Interpretation from its Wage & Hour Division. This Interpretation concludes that the time spent by employees donning and doffing (that is, putting on and taking off) protective equipment required by law is compensable and must be paid. It also means that an employee’s work day begins with the donning of required protective equipment and ends with its doffing, and all of the time in-between is payable work-time. For more on this important wage and hour issue, please read the thoughts of my fellow bloggers:

• Employees Must Be Paid for Donning, Doffing Required Protective Gear – from Human Resources News

• US DOL Issues New Adminstrator Interpretation – from What’s New in Employment Law?

• Redefining Clothes - DOL Edition – from Philip Miles’s Lawffice Space

• Wage and Hour Division Changes Interpretation of FLSA Clothes-Changing Provision – from Washington Labor & Employment Wire

• DOL redefines “clothes” – from LawMemo Employment Law Blog

• DOL Issues Administrator’s Interpretation on Definition of “Clothes” and Whether Changing Clothes is a Principal Activity – from Texas Employment Law Update

• DOL Issues Administrator Interpretation On The Definition Of “Clothes” – from Laconic Law Blog

Here’s the rest of what I read this week:

Wage & Hour

• Lessons from E. coli: Plan or Perish – from Stephanie Thomas at Compensation Cafe

• Will You Take Back Lunch? – from Workplace Diva

• “Realignment” Of Sales Territory Defeats FMLA Claim – from FMLA Insights

• Important Development in Class Action Law: Indemnification Agreement Upheld – from Wage & Hour - Development & Highlights

Discrimination

• Most Job Discrimination Suits Win, at Best, Small Settlements, Study Says – from ABA Journal Daily News

• Tenth Circuit says position held by a temp is not “vacant” for purposes of the ADA – from Employment Law Matters

• You don’t have to retain insubordinate employees – from Sindy Warren at the Warren & Hays Employment Law Blog

• When employee complaints fall on deaf ears – from HR Cafe

• DeepNet: The Final Frontier for Employment Law? – from The Proactive Employer

• Ban Beauty Bias? (And The Horse It Rhode In On...) – from Discriminations

• Too Sexy for My Bosses: Why lawsuits based on looks discrimination—even good ones—are a bad idea – from Richard Thompson Ford at Slate

Social Networking

• Discovery of Social-Media Profiles – from Molly DiBianca’s Going Paperless

• Social Networking Sites: Savvy Screening Tool or Legal Trap? – from New York Labor & Employment Law Report

• Social Networking Sites and Employment: Watch Out for GINA – from Strategic HR Lawyer

Technology

• Computer Fraud and Abuse Act: Current Developments – from Fitzpatrick on Employment Law

• Computer Forensics and Personal Computers in Business Cases – from Ride The Lightning

Labor Law

• The State of the Employment Law Practice - “Boom Times” for the NLRB – from Dan Schwartz’s Connecticut Employment Law Blog

• EFCA’s Obituary – from EFCA & Labor Law Reform Blog

• Gagging Employers – from The ChamberPost

• Is Obama’s NLRB Looking to Suppress Worker Votes in Union Elections? – from LaborUnionReport.com

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Supreme Court tosses 26 months of NLRB decisions in the rubbish

Today was a busy day at the Supreme Court. In addition to Quon (and three other non-labor and employment cases), it also issued its much anticipated decision in New Process Steel v. NLRB. In that decision, the Court held that the NLRB needs at least three members to act. For the last two-plus years of the Bush administration, the NLRB was acting with only two of its five positions filled. By ruling that the Board needs three members, the Court invalidated the 500+ decisions issued by that two-member board. The practical implications of this decision were not lost on the four-Justice dissent penned by Justice Kennedy:

As of the day this case was argued before the Court, the National Labor Relations Board (Board), constituted as a five-member board, had operated with but two members for more than 26 months. That state of affairs, to say the least, was not ideal. This may be an underlying reason for the Court’s conclusion. Despite the fact that the statute’s plain terms permit a two-member quorum of a properly designated three-member group to issue orders, the Court holds that the two-member quorum lost all authority to act once the third member left the Board. Under the Court’s holding, the Board was unauthorized to resolve the more than 500 cases it addressed during those 26 months….

Indeed, in my view, the objectives of the statute, which must be to ensure orderly operations when the Board is not at full strength as well as efficient operations when it is, are better respected by a statutory interpretation that dictates a result opposite to the one reached by the Court.

Looks like the NLRB is going to be very busy re-deciding those 500-plus cases. A copy of the New Process Steel opinion is available from the Supreme Court’s website, here.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Quon v. Arch Wireless: If privacy rights fall in the forest and no one chooses to rule on them…

Quon v. Arch Wireless was one the most anticipated cases before the U.S. Supreme Court for employment attorneys. We hoped that the Court would use this case to sort out the issues that arise from the intersection of employment rights, privacy, and technology. Unfortunately for employment lawyers, Quon turned out to be dud. Because the employer was a police department, the Court decided the case on narrow 4th Amendment grounds, and ignored the key employment and privacy issues for which we had held out hope.

Recall that Quon involved a police department’s review of the content of its employee’s sexually explicit text messages sent via his Department-issued pager. The Court held that the search of Quon’s text messages was reasonable and there was no violation of his 4th Amendment rights. Importantly, the court cautioned that employers not read too much into the management-side victory in this case:

Prudence counsels caution before the facts in the instant case are used to establish far-reaching premises that define the existence, and extent, of privacy expectations enjoyed by employees when using employer-provided communication devices. Rapid changes in the dynamics of communication and information transmission are evident not just in the technology itself but in what society accepts as proper behavior. As one amici brief notes, many employers expect or at least tolerate personal use of such equipment by employees because it often increases worker efficiency…. Another amicus points out that the law is beginning to respond to these developments, as some States have recently passed statutes requiring employers to notify employees when monitoring their electronic communications…. At present, it is uncertain how workplace norms, and the law’s treatment of them, will evolve….

Cell phone and text message communications are so pervasive that some persons may consider them to be essential means or necessary instruments for self-expression, even self identification. That might strengthen the case for an expectation of privacy. On the other hand, the ubiquity of those devices has made them generally affordable, so one could counter that employees who need cell phones or similar devices for personal matters can purchase and pay for their own. And employer policies concerning communications will of course shape the reasonable expectations of their employees, especially to the extent that such policies are clearly communicated.

A broad holding concerning employees’ privacy expectations vis-à-vis employer-provided technological equipment might have implications for future cases that cannot be predicted. It is preferable to dispose of this case on narrower grounds.

In other words: the status quo reigns, employers are left with the no more guidance on these emerging issues than before, and the best practice is still a reasonable technology policy that plainly spells out employees’ expectations concerning personal, non-work related use of employer-owned equipment.

A copy of the Quon pinion is available from the Supreme Court’s website, here.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus. For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.