6th Circuit disables the “cat’s paw” in ADA cases (for now)

Earlier this month, in Staub v. Proctor Hospital, the Supreme Court upheld the cat’s paw doctrine in discrimination cases. While Staub was a USERRA case, at the time I pointed out the likely broad-reaching implications of the holding:

While the Court limited its holding to USERRA, it pointed out that USERRA’s “motivating factor” causation standard is “very similar to Title VII.” It will be difficult for lower court’s to avoid this broad application of the cat’s paw in Title VII (and likely ADA) cases. The only hold-out will be ADEA cases, which, in light of Gross v. FBL Financial Services, Inc., requires “but for” causation.

It took less than three weeks for the 6th Circuit to gut this holding in ADA cases. In Lewis v. Humboldt Acquisition Corp. (6th Cir. 3/17/11), Ohio’s federal appellate court upheld this circuit’s use of a “but for” causation standard in ADA cases. Because this circuit judges ADA cases under a “but for” standard, Staub’s application of the cat’s paw to discrimination statutes using a “motivating factor” standard has no application.

Employers should not get too excited about this victory. The 6th Circuit cautioned that its reading of the ADA’s causation standard is very much in the minority, and invited an appeal to the entire circuit to revisit (and likely overrule) the issue:

The ADA prohibits discrimination “on the basis of” disability.... Of the ten circuits that have considered the contours of this causation standard, eight currently apply a “motivating factor” (or a “substantial cause”) test; that is, a plaintiff must prove that his disability was only a motivating factor of the adverse employment action in order to prevail.... The current law in the Sixth Circuit, however, is that a plaintiff must prove that his disability was the “sole reason” for the adverse employment action....

“A panel of this Court cannot overrule the decision of another panel. The prior decision remains controlling authority unless an inconsistent decision of the United States Supreme Court requires modification of the decision or this Court sitting en banc overrules the prior decision.” ...

Unless that holding is overruled by the full Sixth Circuit sitting en banc or is undermined by an inconsistent decision from the U.S. Supreme Court, it remains good law in this circuit.

For more on the implications of the Lewis decision on the continuing viability of the cat's paw in 6th Circuit ADA cases, I recommend my fellow bloggers at the Employer Law Report.

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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.

Quicken Loans beats multi-million dollar overtime claim

The Department of Labor may not be the most hospitable place for employers these days. Federal juries, however, can prove to be just the opposite. Nearly a year ago, the DOL issued a game-changing Administrator’s Interpretation that mortgage loan officers are not exempt under the Fair Labor Standards Act. Last Thursday, a federal jury concluded that a class of 350 specific mortgage loan officers employed by Quicken Loans are exempt administrative employees under the FLSA.

Here’s the jury’s verdict form:

What does this mean?

1. The jury’s conclusion that the mortgage brokers are exempt is the complete opposite of the DOL’s conclusion in its March 2010 Administrator’s Interpretation. In other words, while employers should be wary of what the DOL is doing in this area, its words is not the gospel.
2. Even though the jury concluded the plaintiffs were exempt, they took the time to fill in an unnecessary “0” on the line asking how many average hours the plaintiffs worked in a week. In other words, the jury simply did not believe the plaintiffs’ story. While lawyers are trained on the law, cases are won and lost on their facts.

The Detroit Free Press quotes Quicken Loans founder and Chairman Dan Gilbert, “It was never about money for us. It was always about right and wrong.” Crains Detroit Business estimates that the defense verdict saved Quicken Loans between $4 million and $30 million in damages for unpaid overtime. Sometimes, it absolutely pays to fight these battles.

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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 #169 (the madness edition)

If you wonder why office productivity sinks like a rock for the next two weeks, look no further than all of your employees checking their brackets while clogging up your computer network watching live college basketball feeds. Three of my fellow bloggers shared their thoughts this week on March Madness’s effect on the workplace:

• March Madness and the Workplace – from Philip Miles’s Lawffice Space
• March Madness in the Office – from Evil HR Lady
• An Employer’s FMLA Nightmare? Hooters Offers Fake “Doctor’s Notes” to Skip Work During NCAA Tourney – from FMLA Insights

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

Discrimination

• When sexting 64 times in 2 1/2 hours ISN’T sexual harassment – from Eric Meyer’s The Employer Handbook Blog
• New Bill Bans Discrimination Against Unemployed – from Stephanie Thomas’s The Proactive Employer Blog
• From Cats Paw to Proximate Cause: A Short Trip? – from Workplace Prof Blog
• “Notorious Nine” mistakes by employers in dealing with the EEOC – from Employment and Labor Insider
• Must You Allow Telecommuting as an ADA Accommodation? – from HR Daily Advisor
• EEOC Holds Hearing on Employment of Individuals with Intellectual and Psychiatric Disabilities – from Washington D.C. Employment Law Update
• Service Animals Limited to Dogs and Some Miniature Horses Under New ADA Rules – from World of Work
• ADA and Drug Addiction: The Ninth Circuit Provides Guidance – from Delaware Employment Law Blog
• The Cost of Employment Laws – from Mark Toth’s Manpower Employment Blawg
• EEOC Provides Insight Into Its Increase in Charges Filed – from Labor & Employment Law Perspectives
• Back to basic on the defense – from Work Matters

Labor Relations

• Union-Controlled NLRB Approves Union Thuggery in Union Elections – from LaborUnionReport.com
• Secret Ballot Protection Act Introduced in House – from Seth Borden at Labor Relations Today
• Questioning Dress Code Was Protected Activity, NLRB Holds – from Joe’s HR and Benefits Blog
• The Problem with Unions – from Maryland Employment Law Developments
• NLRB General Counsel Issues Memorandums Targeting Backpay Mitigation and Calculation – from Labor Relations Counsel
• Dress codes: protected, concerted activity and the non union employer – from Michigan Employment Law Connection
• Women bear brunt of union-busting – from Politico

Social Media & Workplace Technology

• Moms feel stress, guilt from work emails, texts at home – from Eve Tahmincioglu at Careers on MSNBC.com
• Tweets That Will Get You Fired – from The Not-So Private Parts
• Can an Employee Be Terminated for Simply Surfing the Internet? – from TLNT
• Who Owns My Social Media Contacts and Posts? – from Screw You Guys, I’m Going Home
• Will Tweets Destroy the NFL and NFLPA CBA Negotiations? – from Shear on Social Media Law
• Now this is how you use a corporate blog! Chrysler does it right after Twitter F-bomb – from Social Media Today

HR & Employee Relations

• Court: Failure to Follow Training Program Does Not Give Rise to Breach of Contract Claim – from Daniel Schwartz’s Connecticut Employment Law Blog
• Candidate Friendly Background Check Practices – from employeescreenIQ Blog
• Emailed Policy Updates for Noncompetes - Not A Best Practice – from Trade Secret / Noncompete Blog
• Is It Legal For An Employer To Charge A Potential Employee For A Background Check? – from fyiscreening.com
• Drug and Alcohol Testing of Employees in the Workplace – from Minnesota Labor & Employment Law Blog
• Protecting Trade Secrets Through Employee Surveillance: Risky Business – from Trade Secrets & Non-Compete Blog
• Tips for Dealing with Workplace Bullying – from Wisconsin Employment & Labor Law Blog

Wage & Hour

• Daylight Savings Time Has FLSA Implications: Employers Beware – from Wage & Hour - Development & Highlights
• Knock, Knock: We Are The Government And We Are Here To Help (Especially If You Want To Sue Your Employer) – from Employment Essential
• Supreme Court Affirms Second Circuit Court's Ruling in Wage and Hour Case: Enormous Implications for the Pharmaceutical Industry – from Employment Lawyer Blog
• Seventh Circuit Upholds Denial of FMLA Leave To Employee Who Ignored Employer's Telephone Calls – from Employer Law Report
• Ninth Circuit Defines FMLA Interference Claim – from What's New in Employment Law?
• Correctly Treating Travel Time As Hours Worked Under Fair Labor Standards Act (FLSA) Regulations – from George’s Employment Blawg
• Give Moms a Break: Anticipating Final Regulations On Break Time for Nursing Mothers – from Washington Workplace Law

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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.

What does St. Patrick have to do with human resources?

Legend tells us that in the 5th century, St. Patrick banished all snakes from Ireland. In honor of the day that celebrates Ireland’s patron saint, consider banishing the following metaphorical snakes from your HR practices:

• Illegal questions on employment applications, such as age, medical conditions, or workers compensation histories.
• Irregularities in pre-hiring procedures, such as unlawful background checks, medical inquiries, and medical exams.
• Overly broad policies in employee handbooks, such as anti-union no-solicitation policies or policies that ban discussions of wages and other workplace terms and conditions.
• FMLA policies that do not comply with the law’s recent regulatory changes.
• Absent technology and social media policies.
• Harassment training done less frequently than ever other year.
• Misclassified employees (non-exempt as exempt, and employees as independent contractors).
• Managers and supervisors that have not been trained in the handling, discipline, and documentation of problem employees?
• Missing EEO, DOL, and other mandatory employment law postings.
• Key employees that are not locked down with appropriate confidentiality, no-solicitation, and/or non-competition agreements.

While there may never have been snakes in Ireland, we at least know that they haven’t bothered anyone on the Emerald Isle since the time of St. Patrick. Do yourself a favor by ensuring that these employment law snakes do not bother your business again.

Telecommuting employees raise special wage and hour issues

At Overlawyered, Walter Olson asks whether telecommuting is the next wave of wage and hour litigation. He might have a point. Some estimate that as many as 50 million Americans work remotely at least part of the time. Because many of these telecommuters will be non-exempt, how employers track their hours and pay their wages has the potential to cause problems.
Pursuant to the Fair Labor Standards Act, non-exempt employees must be paid for all time worked, including overtime for hours in a week worked in excess of 40. Employers must also maintain a tracking system that accurately records this compensable work time. Because telecommuters work outside of the workplace, and often during odd hours, they present special problems for accurately tracking the amount of time spent working.

If your business is going to employ telecommuters, you should take appropriate measures—in a telecommuting policy or contract—to control the time spent working:

• Employers should clearly communicate to the employee the number of hours expected to be worked each week.
• Telecommuting employees must be required to accurately track all time spent working. Whatever the system used (pen and paper timesheets, Excel spreadsheets, timekeeping software, or electronic logins or other “punches”), employees must understand that they will only be paid for the amount of time reported.
• Because telecommuting employees are working without direct supervision, all submitted work should be reviewed by a manager or supervisor to ensure that the work performed correlates to the amount of working time reported. An employer cannot dock time or refuse to pay an employee for time spent working. However, an employer can take away an employee’s ability to telecommute (or otherwise discipline) if the employee proves to be irresponsible or abuses the telecommuting privilege.

Telecommuting may not be “the next big thing” in wage and hour litigation. It raises, however, enough unique wage and hour issues that inattentive employers who ignore these issues risk getting burned.

Time to play Medical Costs Price is Right

As many of you know, last month my son spent 19 days in the Cleveland Clinic. Now that he is home and, most importantly, healthy, I thought we’d have a little fun, while at the same time providing an editorial on the ridiculously high cost of American medical services. It’s time to play Medical Costs Price is Right.

Here are the rules:

1. Anyone who is 18 years of age or older, a legal U.S. resident, and has a valid email address is eligible to enter.
2. Current KJK employees and their immediate family members are not eligible to enter.
3. No purchase of anything (including legal services) is required to enter.
4. Your bid will be for the total, non-insurance adjusted, cost of a 19-day inpatient stay at the Cleveland Clinic, including all procedures, doctors, tests, and labs:
   • 19 days in the pediatric ward at the Cleveland Clinic Main Campus
   • 1 endoscopy (with general anesthesia)
   • 1 PICC line insertion (with general anesthesia)
   • Professional fees for gastroenterology, surgery, cardiology, and hematology
   • Emergency room fees
   • 3 x-rays
   • 1 ultrasound
   • 2 echocardiograms
   • 16 days of intravenous feedings
   • Laboratory charges for blood work
5. The closest bid that does not go over the total cost wins.
6. Bids will be accepted until March 31 at 11:59 p.m.
7. There are 3 ways to enter:
   • Post a comment with your guess to this blog post. I will not accept any anonymous comments as an entry.
   • Send a reply with your guess to @jonhyman on Twitter, using the hashtag #MedicalCostsPriceIsRight.
   • Post your guess on the wall of the Ohio Employer’s Law Blog Facebook Page, also using the hashtag #MedicalCostsPriceIsRight.
8. Each person is only allowed one entry total, no matter how the guess is submitted. I will disqualify anyone that submits more than one guess.
9. I will reject any bids that do not follow these rules.
10. The winning bid must provide a valid address within one week of my announcing of the winner. Otherwise, I reserve the right to select the next closest bid that did not go over the total cost.
11. If no bids are submitted that do not go over the total cost, I reserve the right to select the closest overall bid to the total cost.

What will the winner get?

A box of KJK-branded Pro V1s and a KJK-branded water bottle (I never promised a car).

Good luck and happy bidding.

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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.

Understanding the legal issues of the NFL labor problems

At 11:59 p.m. Friday night, the collective bargaining agreement between the NFL and the NFLPA expired, and the owners locked out its players. We’ve all heard about lockouts before, but what does all this mean? Gabriel Feldman, at the Huffington Post, provides the answer for those unaccustomed to the ins and outs of federal labor law:

A lockout is the “withholding of employment by an employer from its employees for the purpose of either resisting their demands or gaining a concession from them.” In other words, a lockout is when an employer refuses to let workers work, and therefore get paid, as a form of leverage. A lockout is prohibited if it is motivated primarily as an attempt to discourage union membership or interfere with employees’ organizational rights. Lockouts can occur before or after a bargaining impasse has been reached.

Mr. Feldman offers answers to 25 other labor law questions necessary to understand the NFL’s labor strife, including:

• What is decertification?
• What is the process for decertification?
• Why do the players have to break up their union to bring an antitrust suit?
• And, would the NFL owners be permitted to lock out Brett Favre, and only Brett Favre?

The article is mandatory reading for anyone looking to understand the basics of the complex issues behind the NFL’s ongoing and evolving labor woes.

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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.