“That guy” has a valid retaliation claim?

Every workplace has “that guy.” The employee who can’t quite seem to keep his mouth shut, who says inappropriate things, the one you know will someday lead to a harassment lawsuit. (Hint: If you can’t think of who “that guy” is in your workplace, it might be you).

Dunn v. Automotive Finance Corp. (M.D. Tenn. 7/2/13) is about “that guy,” but with a twist. “That guy” was Robert Dunn, a manager terminated by Automotive Finance Corp. for making inappropriate racially based comments during a social gathering following a training session. Present for Dunn’s alleged comments were four other white managers, along with one African-American assistant manager, Rick Hopkins. Several of those present complained about Dunn’s comments; the company investigated and fired Dunn.

Dunn was accused of making three racially insensitive comments:

• A comment that Tiger Woods was being judged by a white man’s standard, as compared to Michael Vick, who went to prison.
• A comment that his mother was Indian and not allowed to sit with White people back in the day.
• In reference to a statement that Hopkins would be the next manager at the company, Dunn said, “Good luck. Have you seen a family photo of this place?” and that the company had very few African-American managers “walking the halls.”

What was Dunn’s explanation when a co-worker expressed her discomfort at his statements? “That’s just how I am, because I’m a country boy.” When that same co-worker complained to management about Dunn’s comments; the company investigated and fired him.

Here’s the twist. Dunn sued for retaliation, claiming that Title VII protected his comment about a lack of upward mobility for African-Americans within the company. Incredibly, the court agreed that Dunn’s statement at least presented a question for a jury to determine as to whether that comment is protected from retaliation under Title VII.

Dunn made one comment or a set of comments that could reasonably be construed as protected activity: complaining in front of the Branch Managers that AFC discriminated on the basis of race with regard to promoting black managers. There are competing accounts as to precisely what Dunn said, although the witnesses who recall the incident appear to agree that Dunn accused AFC of being a racist company and/or that Dunn stated that AFC would not promote Hopkins because he is black…. The fact that Dunn made this comment in front of a black Assistant Branch Manager and that it made the white employees “uncomfortable” was just a side effect of speaking his mind that the company had and would continue to practice illegal racial discrimination.

The company argued that Dunn was merely seeking “to insulate himself from the consequences of [his] inappropriate conduct by concocting a post hoc rationalization that he had actually engaged in some form of ‘opposition’ activity.” I agree.

Cases like this one undermine the protections offered by the anti-retaliation laws, and send the wrong message to employers. The company fired Dunn because a co-worker complained about inappropriate race-based comments. The employer met is obligation under Title VII to investigate the allegations, and implement corrective measures to ensure that the comments stopped. Yet, the employer got punished for meeting its anti-harassment obligations. If the employer retained Dunn, it could have faced a potential harassment lawsuit. An employer should not have to choose between a harassment lawsuit by an offended employee, or a retaliation lawsuit by an alleged harasser who appears less than genuine in his “complaints.”

This case also is a perfect example of the maxim that any employee can sue at any time for any reason, and helps illustrate my point that because of the risk of lawsuits, employers are exceedingly gun-shy about firing employees.

photo credit: foreverdigital via photopin cc

WIRTW #281 (the "is it live or is it Memorex" edition)

Earlier this week, I appeared on Huffington Post Live, in a segment discussing discrimination laws, at-will employment, and the rights of employers to terminate employees. If you missed it live, here’s your chance to see me live and in Internet-buffered color:

Also, if you missed this month’s Employment Law Blog Carnival, hosted by Robin Shea, it is worth a trip down Route 66 to read the best employment-law posts from the past month.

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

Discrimination

• Roadmap for Responding to an Employee’s Request for Religious Accommodation — from Employment Law Lookout
• What Do You Mean I Can’t Ask That Question????!!!! — from The Emplawyerologist
• Boss fired breast-feeding mother: Was it pregnancy discrimination? — from HR Café
• Dear Evil Skippy: Was It Harassment For My Supervisor To Give Me A Massage? — from Evil Skippy at Work
• Court Resists “Irresistible” Employee’s Lawsuit... Again — from Phil Miles’s Lawffice Space
• Beware the Dark Side: “But For” Doesn’t Mean “Sole Cause” In Retaliation Claims — from Donna Ballman’s Screw You Guys, I’m Going Home
• What Exactly Does Vance v. Ball State University Mean to Employers? — from Employment & the Law

Social Media & Workplace Technology

• How 3 NFL players’ mea culpa will improve your social media policy — from Eric Meyer’s The Employer Handbook Blog
• You, Too, Can Move Your Company Into the Cloud — from Harvard Business Review
• What Are Your Rights to Life, Liberty and the Pursuit of Privacy? — from The Sociable Lawyer Blog
• Security is Key to “BYOD” Policies — from Pennsylvania Labor and Employment Law Blog
• BYOD: Do You Feel Lucky? Well, Do Ya Punk? — from Ride The Lightning
• Employers, Facebook, and the SCA Do Not a Love Triangle Make — from Molly DiBianca’s Delaware Employment Law Blog
• Service of Process Via Social Media – a Comparative Approach — from Augmented Legality
• What happens to your smartphone after it’s stolen — from The Verge
• Electronic media use policies must be applied evenly and consistently — from EmployerLINC

HR & Employee Relations

• Top Ten Things to Consider When Drafting A Non-Compete Agreement — from Trade Secrets & Non-Compete Blog
• Would You Hire Someone With a Visible Tattoo? — from hr bartender

Wage & Hour

• When using temps, make sure temp agency retains control of employment relationship — from Business Management Daily
• Why Interns Are Suing ‘Saturday Night Live,’ Hollywood, and Other Dream Employers — from Businessweek
• Sixteen Types of Wage & Hour Records Employers Need to Keep — from Dan Schwartz’s Connecticut Employment Law Blog

Labor Relations

• NLRB General Counsel Keeps Unfriending Employer Social Media Policies — from Employment Law Watch
• “Nuclear Option” Averted (For Now), NLRB Likely To Reach Full Strength Soon — from Labor Relations Institute
• NLRB Truth: 10 Reasons Why the National Labor Relations Board Matters — from Workplace Fairness
  
  
  
  
  
  
  
  
  
  
  

Ohio Supreme Court strikes blow to class action lawsuits

In recent terms, the U.S. Supreme Court has shown some hostility to class action lawsuits. 

• In Wal-Mart v. Dukes, the Court concluded that a district court must examine the underlying merits of a claim to determine if class certification is appropriate, and that a class must have some glue binding disparate decisions to justify certifying all of those decisions for consideration in one class. 
• In Comcast v. Behrend, the Court expanded upon Dukes by concluding that a class that requires individualized proof to establish damages for each class member cannot survive as a class action.

The impact of these two decisions might to send class litigants, if possible, to state court. Dukes and Comcast are federal decisions under Federal Civil Rule 23. If a state’s class-action-certification rules are more lenient, then the class’s attorney will do whatever it takes to keep the class in state court. 

Yesterday, however, the Ohio Supreme Court made this strategy much more difficult. Stamcco, LLC v. United Telephone Co. of Ohio [pdf], is not an employment case. It involves allegations of cramming — claims that the defendant added unauthorized charges the class members’ telephone bills. Yet, this case has huge implications for how all class actions are litigated under Ohio law, including classes alleging, for example, violations of Ohio’s employment discrimination or wage and hour laws.

With extensive citations to, and discussion of, Dukes, the Court held:

At the certification stage in a class-action lawsuit, a trial court must undertake a rigorous analysis, which may include probing the underlying merits of the plaintiff’s claim, but only for the purpose of determining whether the plaintiff has satisfied the prerequisites of Civ.R. 23.

Implicitly adopting the logic of Comcast, the Court also held:

We now recognize that the need for individualized determinations is dispositive in concluding that the class does not comport with Civ.R. 23.

Rejecting the plaintiff’s claim that a court could apply a simple formula to data provided by the defendant to determine each member’s claim, the Court concluded that this case cried out for individualized determinations:

Unauthorized third-party charges are better resolved on an individual basis with the third party or UTO. UTO’s phone bills identify third-party charges, the entity responsible for the charge, and a toll-free number for billing inquiries. Moreover, UTO claims that it has a policy of removing third-party charges for the purpose of maintaining good will with its clients. Finally, for larger charges or where the charge cannot be resolved over the phone, small-claims court is also an option. Accordingly, because ascertaining whether third-party charges are authorized will require individualized determinations, common issues do not predominate.

One could apply the same logic to wage and hour claims. If an employer has, for example an open-door policy, and will consider providing redress to employees on a case-by-case basis for complaints about missing wages, one cannot apply a simple formula to calculate class-wide damages. Moreover, while the plaintiffs’ bar will lose their minds over the idea of small-claims court, it remains a viable option for employees to inexpensively litigate their right to missing wages. The $3,000 limit for small claims will cover the vast majority of individual wage and hour claims.

Stamcco is a huge victory for Ohio businesses. It is now that much harder to establish a class action, confirming that Ohio’s class-action rules fall in line with their federal counterparts.

Who owns personal email on an employer-issued smartphone?

The following scenario is playing out in companies all over America. A company issues a smartphone to an employee. The company owns and pay for the device, but allows the employee to use the device for personal reasons, including accessing a personal email account, such as Gmail. The employee returns the phone, but does not first erase her personal email from the device. Is it legal for the employer, who owns and pays for the phone, to access the employee’s personal email account after the device’s return?

According to Lazette v. Kulmatycki (N.D. Ohio 6/5/13), the answer is no. In Lazette, the facts alleged are significantly worse than my fact-pattern above. After Lazette returned the phone, her supervisor, over the course of 18 months, surreptitiously read 48,000 of Lazette’s personal emails, including those involving her family, career, financials, health, and other personal matters.

The meat of the decision concerns whether the employer violated the Stored Communications Act (although Lazette also brought federal- and state-law wiretap claims, and common law claims for invasion of privacy and intentional infliction of emotional distress. The Stored Communications Act prohibits the unauthorized access of personal email and other Internet accounts. Think of it as an anti-wiretapping law for the Internet. The court refused to dismiss the Stored Communications Act claim, concluding that Lazette had pleaded sufficient facts in her complaint for the case to proceed to discovery. if you are at all interested in the SCA, what it covers, and how it works, I commend this case to your reading list.

Aside from the legal intricacies of the Stored Communications Act, this case raises important practical considerations about the risks companies are taking via the use of mobile devices at work. Smartphones aren’t going away. Indeed, if you’re anything like me, it’s become more of an appendage than a phone. So, how should companies manage the risks of these devices under increasing judicial scrutiny and application of the Stored Communications Act? Let me offer three practical tips:

1. Draft a policy. Under the Stored Communications Act, personal data is sacred. Telling employees that they do not have any expectation of privacy in company-owned mobile devices might not save you from a Stored-Communications-Act claim if one employee surreptitiously accesses another employee’s personal email account. For sure, have a policy that spells out an employee’s reasonable lack-of-privacy expectations, but have a similar policy statement prohibiting employees from accessing the personal email or other Internet account of others.
2. Wipe the device. Curiosity might have killed the cat, but you shouldn’t let it kill your company. Left to their own devices, people will snoop. Don’t give them the opportunity to do so. When a mobile device is returned by an employee, wipe it clean of all personal information and data.
3. But, quarantine it first. I suggest, however, that before you wipe a device you pause to make sure that you don’t need any data on the device. Once it’s wiped, it’s going to be very hard, if not impossible, to recover that data. Are there pending lawsuits for which data on that phone might be discoverable? If so, you better save it until you can determine what, if anything, needs to be preserved or produced. Are you concerned that the ex-employee might have been talking to a competitor or walked off with your trade secrets or other confidential or proprietary information? if so, you better check the phone to see if there is any evidence you can use to build your claim before you wipe it clean.

(Hat tip: Privacy & Information Security Law Blog)

The one thing you can never release in a settlement agreement

Legal disputes end in one of two ways—either with a judgment by a court or an agreement between the parties. The vast majority of cases follow the latter course.

When parties enter an agreement to settle a dispute—either in a settlement agreement ending litigation or a severance agreement ending one’s employment—the goal is to release all claims brought, or that could have been brought. An employer is paying the employee, in part, for the certainty that the employee will not file other claims against it in the future for past acts. Thus, these agreements typically contain general releases, along with covenants not to sue.

Do not, however, make the mistake of including in your agreement a covenant forbidding the employee from filing a discrimination charge with the EEOC or other agency. The EEOC will view such a provision as retaliatory under Title VII.

Last week, the Agency announced that it had reached a settlement with Baker & Taylor over claims that the company “violated Title VII by conditioning employees’ receipt of severance pay on an overly broad, misleading and unenforceable severance agreement that interfered with employees’ rights to file charges and communicate with the EEOC.” The EEOC alleged that the company required employees “to sign a release agreement that could have been understood to bar the filing of charges with the EEOC and to limit communication with the agency” in order to receive their severance pay.

The offending provisions (taken from the EEOC’s Complaint) were as follows:

• “I further agree never to institute any complaint, proceeding, grievance, or action of any kind at law, in equity, or otherwise in any court of the United States or in any state, or in any administrative agency of the United States or any state, country, or municipality, or before any other tribunal, public or private, against the Company arising from or relating to my employment with or my termination of employment from the Company, the Severance Pay Plan, and/or any other occurrences up to and including the date of this Waiver and Release, other than for nonpayment of the above-described Severance Pay Plan.”

• “I agree that I will not make any disparaging remarks or take any other action that could reasonably be anticipated to damage the reputation and goodwill of Company or negatively reflect on Company.  I will not discuss or comment upon the termination of my employment in any way that would reflect negatively on the Company. However, nothing in this Release will prevent me from truthfully responding to a subpoena or otherwise complying with a government investigation.”

How could this problem have been avoided, while still providing the employer relative certainty that it will not have future legal dealings with the releasing employee? A simple disclaimer tacked onto the back-end of the release language, stating that nothing in agreement prevents, or is intended to prevent, the employee from filing a charge of discrimination with the EEOC, or with a state or local civil rights agency. You can couple that language with a covenant providing that in the event that the employee files such a charge, the employee disclaims the right to seek or recover money damages from such a filing.

With this language, the employee retains the right to file a charge (minus damages), the EEOC retains the right to seek redress of civil rights violations, and the employer retains peace of mind that the employee has signed as strong of a release as Title VII allows.

Fight the power! A timeless lesson on employee relations from "What's Happening!!"

As I settled in for a quiet Friday night in front of the TV, I stumbled upon one of my guilty pleasures — “What’s Happening!!” If your unfamiliar with this late 70s sitcom gem, it tells the story of three high-school friends growing up in the Watts section of Los Angeles, Raj, Dwayne, and Rerun, along with Raj’s pest of a little sister, Dee, their strong-willed single mom, Mabel, and the wise-cracking waitress at the local diner, Shirley.

The episode upon which I stumbled is called One Strike and You’re Out. It’s not as good as the classic “Doobie Brothers” episode, but, beggars can’t be choosers, right?

Here’s the synopsis, courtesy of Wikipedia:

Rerun being fired from the supermarket is the last straw for Raj, who rallies the rest of the workers to take some action against their boss Mr. Pronson. However, when the staff goes on strike, Raj finds himself in a jam, since Mama has lost her job and the family now has no source of income.

Enjoy this little slice of sitcom history, which teaches the important and timeless lesson that appearances aren’t always what they seem with your employees, what motivates their actions might not be what you think, and employees have lives outside of work that can, and often do, impact how they behave on the job.

Part One:



Part Two:

WIRTW #280 (the “has it been a year already” edition) #blawg100

The ABA Journal is, again, seeking nominations for its list of the 100 best legal blawgs, the “Blawg 100.” The nomination process is simple. Go here and answer a few simple questions touting your favorite blawgs. If you are so inclined, please take a few moments between now and August 9 to show some love for the blawgs you regularly read. If you take a look at this week’s list of links below, you’ll get a flavor for some the blawgs I’ll be nominating.

Also, I cannot let the week go by without giving a huge thank you to fellow blawger, Phil Miles, who, at his Lawffice Space blog, posted a review of my book, The Employer Bill of Rights. Phil’s words are much appreciated. The best compliment anyone can pay a lawyer is that you don’t write like a lawyer. Phil, from one to another, thanks.

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

Discrimination

• Is Obesity a Disability? — from WSJ.com: Law Blog [Thanks for the link to my earlier post]
• Obesity as a workplace disability? One court bucks the trend and says no. — from Eric Meyer’s The Employer Handbook Blog
• Gays And Lesbians Turn Fight To Workplace Discrimination Ban — from NPR’s All Things Considered
• No Brazilian Wax, No Job — from Phil Miles’s Lawffice Space
• An Employee Is Stealing Company Documents … That Can’t Be Protected Activity, Right? — from Trading Secrets
• The SCOTUS Decisions Every Employee Should Be Talking About — from Harvard Business Review
• Whole Foods Revises Its English-Only Policy — from Employer's Law Blog [background here]

Social Media & Workplace Technology

• Is a Candidate’s Profile Picture Worth a Thousand Words? — from EmployeeScreenIQ Blog
• The 2013 Social Media Landscape — from Social Media Today
• What Google Glass Means for Workplace Policy — from Mashable
• School board axes law firm after attorney’s viral video rant — from ABA Journal Daily News
• Are “Sent From My Phone” Signatures Useful or Annoying? — from Lifehacker
• Happy Birthday George Orwell, here's your surveillance society — from The Verge
• Common Law Invasion of Privacy Claims in Social Media — from Augmented Legality

HR & Employee Relations

• Restaurant Wars: Restrictive Covenants for Chefs & Tandoori Chicken Tikka — from Dan Schwartz’s Connecticut Employment Law Blog
• An Introduction to Background Checks for Employers — from ERC Insights Blog
• A cautionary tale about out‑of‑state telecommuting — from EmployerLINC
• Is bullying in the workplace legal? — from Mike Haberman’s Omega HR Solutions

Wage & Hour

• The Last Word: In Defense of Unpaid Internships — from Rick Bell at Workforce.com
• Supremes' DOMA decision may simplify some spousal FMLA administration — from Robin Shea’s Employment and Labor Insider
• The Questions to Ask Before Adopting an ESOP — from You’re the Boss Blog
• FLSA Status of Mortgage Loan Officers Remains Unsettled — from Minnesota Employment Law Report
• The “Fluctuating Work Week” — An FLSA Mirage — from New York Labor and Employment Law Report
• Are Mortgage Loan Officers Exempt or Non-Exempt? That's an Excellent Question. — from Wage & Hour Defense Blog
• Avoiding Court by Calculating “Regular Rate of Pay” the Right Way — from Blogging4Jobs
• Failing to Recognize an Employee's Need for FMLA Leave Can be A Costly, Painful Mistake — from Jeff Nowak’s FMLA Insights

Labor Relations

• Supreme Court to Consider Labor Issues Next Term — from Washington D.C. Employment Law Update
• Does Your Email Policy Pass Muster? New NLRB Decision Offers Guidance — from Labor & Employment Law Perspectives
• No Changing of the Guard: NLRB Continues to Uphold Policies Barring Union Use of Employer Email Systems — from Labor Relations Counsel
• NLRB: Employee’s Outburst In Calling Manager “Trouble” Not So Egregious As To Render Conduct Unprotected — from Labor Relations Update