Did the 6th Circuit just guarantee jury trials in off-the-clock wage/hour cases?

One of the most difficult things to do is prove a negative. Yet, this is exactly the problem that employers face when defending wage and hour cases in which the employee alleges work performed off-the-clock. The employer says that the time clock defines the paid limits of the workday, while the employee says that s/he should be compensated for work performed outside the parameters of those clock-ins and clock-outs.

In Moran v. Al Basit LLC (6/1/15) [pdf], the 6th Circuit was faced with a simple question—does an employee need something other than his or her own testimony to establish an entitlement to unpaid compensation under the FLSA?

Sadly, the 6th Circuit ruled in the employee’s favor.

Plaintiff’s testimony coherently describes his weekly work schedule, including typical daily start and end times which he used to estimate a standard work week of sixty-five to sixty-eight hours.… However, while Plaintiff’s testimony may lack precision, we do not require employees to recall their schedules with perfect accuracy.… It is unsurprising, and in fact expected, that an employee would have difficulty recalling the exact hour he left work on a specific day months or years ago. It is, after all, “the employer who has the duty under § 11(c) of the [FLSA] to keep proper records of wages [and] hours,” and “[e]mployees seldom keep such records themselves.”

This ruling is scary, and has the potential to work extortionate results on employers. If all an employee has to do to establish a jury claim in an off-the-clock case is say, “The employer’s records are wrong; I worked these approximate hours on a weekly basis,” then it will be impossible for an employer to win summary judgment in any off-the-clock case.

Employers, the cost of defending wage-and-hour cases just went up, as did the risk for businesses. Even meticulous wage-and-hour records might not save you from a foggy memory of a disgruntled ex-employee.

#SCOTUS requires employers to stereotype in ruling for EEOC in hijab-accommodation case

Yesterday, the United States Supreme Court ruled that an employer violates Title VII’s religious accommodation requirements if the need for an accommodation was a “motivating factor” in its decision, regardless of whether the employer had actual knowledge of the religious practice or its need to be accommodated.

The case, EEOC v. Abercrombie & Fitch Stores [pdf], is an unambiguous win for religious freedoms, while, at the same time, places an added burden on employers to make educated guesses about applicants’ and employees’ potential needs for workplace religious accommodations.

Abercrombie involved a conflict between a hijab-wearing Muslim job applicant and the employer’s “look policy.” The unusually terse seven-page opinion (of which only a little more than three was dedicated to actual legal analysis) focused on the difference between motive and knowledge in explaining its holding:

Motive and knowledge are separate concepts. An employer who has actual knowledge of the need for an accommodation does not violate Title VII by refusing to hire an applicant if avoiding that accommodation is not his motive. Conversely, an employer who acts with the motive of avoiding accommodation may violate Title VII even if he has no more than an unsubstantiated suspicion that accommodation would be needed.…

For example, suppose that an employer thinks (though he does not know for certain) that a job applicant may be an orthodox Jew who will observe the Sabbath, and thus be unable to work on Saturdays. If the applicant actually requires an accommodation of that religious practice, and the employer’s desire to avoid the prospective accommodation is a motivating factor in his decision, the employer violates Title VII. 

So, if knowledge is irrelevant, what is an employer to when faced with one’s potential need for a religious accommodation? More the point, isn’t an employer faced with having to make educated guesses (based on stereotypes such as how one looks or what one wears) of the need for an accommodation? Title VII is supposed to eliminate stereotypes from the workplace, not premise the need for an accommodation on their use. And that’s my biggest critique of this opinion—it forces an employer into the unenviable position of applying stereotypes to make educated guesses.

Nevertheless, employers are stuck with the Abercrombie “motivating factor” rule as the rule for religious accommodations moving forward. Thus, let me offer a simple suggestion on how to address this issue in your workplace—talk it out. Consider using the following three-pronged approached to ACE religious-accommodation issues in your workplace.

• Ask: Even if an employee comes to a job interview wearing a hijab, it’s still not advisable to flat-out ask about his or her religion. Nevertheless, if you believe an applicant’s or employee’s religion might interfere with an essential function of the job, explain the essential functions and ask if the employee needs an accommodation. 

• Communicate: If the individual needs an accommodation, engage in the interactive process. Have a conversation with the applicant or employee. Explain your neutral policy for which an exception will have to be made. Talk through possible accommodations, and decide which accommodation, if any, is appropriate for your business and for the individual.

• Educate: Do you have written policy on religious accommodation? Of course, merely having a policy is never enough. You must communicate it to your employees, explain its meaning and operation, and enforce it when necessary.

This decision is a potential game-changer for employers. Make sure you understand the implications of Abercrombie, so that you are as accommodating as the law requires.

Image courtesy of Jeffrey Weston’s Ape, Not Monkey
http://www.apenotmonkey.com/2012/04/09/religious-accommodation/

6th Circuit: reasonable belief about unlawful conduct enough for SOX retaliation

It’s hard to imagine that in the eight-plus years I’ve written this blog, there is any area of employment law that on which I have not yet touched—except, I think, the Sarbanes-Oxley Act. Today, that changes.

For the uninitiated, Sarbanes-Oxley (or SOX) is a federal statute, enacted in reaction to a several corporate and accounting scandals (think Enron), which establishes conduct standards for public company boards, management and public accounting firms.

In Rhinehimer v. U.S. Bancorp Investments, Inc. (6th Cir. 5/28/15) [pdf], the 6th Circuit addressed the standard for protected conduct under SOX’s anti-retaliation provisions. Does the plaintiff have to prove an underlying fraud, or it is sufficient for the plaintiff to have a reasonable belief that a fraud was committed?

The facts in Rhinehimer are not complicated. Prior to taking a disability leave, Rhinehimer, a certified financial planner, transferred some of the assets of a long-term, elderly client into low risk, conservative investments. While on leave, Rhinehimer’s assistant alerted him to the fact that a co-worker moved some of those assets into riskier investments. Believing those moves to be contrary to the client’s estate plan, Rhinehimer sent an email to his supervisor complaining about the transactions. Upon his return from leave, Rhinehimer was disciplined for his “unprofessional” email. That email spawned an investigation by FINRA. When Rhinehimer informed his employer that he had retained an attorney in response to the FINRA investigation, he was fired.

At issue on appeal was whether a plaintiff claiming retaliation under SOX must allege the specific elements of fraud relating to the underlying transaction, or if a reasonable, but mistaken, belief about the illegality of the underlying (mis)conduct will support the retaliation claim.

The 6th Circuit held for the more liberal proof standard.

Although it is true that Plaintiff had no specific knowledge of whether Harrigan had omitted or misrepresented material information in his communications with Purcell, much less any knowledge of whether Harrigan did so intentionally or with reckless disregard, these gaps in Plaintiff’s knowledge are immaterial. Even if, in fact, everything about the trades were above board, courts universally recognize that [SOX] protects employees who reasonably but mistakenly believe that the conduct at issue constitutes a violation of relevant law.… 

The information that was available to Plaintiff was more than adequate to allow him reasonably to believe that the trades were the result of conduct constituting unsuitability fraud. When USBII retaliated against him for reporting that information, it therefore violated Sarbanes–Oxley’s whistleblower protections.  

If you are a publicly-trade company, employees who lodge complaint about financial improprieties or other financial issues require special treatment. If faced with one of these complaints, do not get hung up on the rightness or wrongness of the complaining employee’s belief about the illegal conduct, because, if you later fire that employee, it appears the reviewing court will not care. 

WIRTW #368 (the “let's go Cavs” edition)

It’s t-minus six days until championship fever sweeps the most victory-starved city in America. Let’s go Cavs!

A photo posted by Cleveland Cavaliers (@cavs) on May 27, 2015 at 12:02pm PDT

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

Discrimination

• Being “Qualified” Doesn’t Necessarily Mean Being Able to Perform “Essential Functions” of Job — via Dan Schwartz’s Connecticut Employment Law Blog
• Here’s Why Your Company Should Offer Paid Maternity Leave — via TLNT
• Private Employers Likely to Face Gender Identity Discrimination Claims as Federal Government Continues to Expand Title VII Protections to Transgender Employees — via Employer Defense Law Blog
• EEOC Will Now Process and Investigate Sexual Orientation, Transgender, and Gender Identity Claims — via Randy T. Enochs’s Wisconsin Employment & Labor Law Blog

Social Media & Workplace Technology

• Five Key Social Media Questions All Health Care Employers Should Consider: Question #3: How Do I Protect Patient Privacy On Social Media? — via netWORKed Lawyers
• Those without Facebook accounts need not apply. Well, maybe not in one state. — via Eric Meyer’s The Employer Handbook Blog
• Doing online “reputation management”? — via Walter Olson’s Overlawyered
• “Sixth Circuit creates circuit split on private search doctrine for computers” — via How Appealing
• What Companies Should Ask Before Embracing Wearables — via Harvard Business Review
• Cyber Insurance: Why you should require certain vendors to have it — via Privacy and Data Security Insight
• Don’t Tweet On Me! — via Employment Law Lookout
• Texting in the office: a problem, or just yet another distraction? — via Business Management Daily

HR & Employee Relations

• American Ninja Warrior – Lessons on Family, Life, & Work — via Rob Schwartz’s dadworking
• No Matter What Scrabble Says, Don’t Ever Use These 10 Words at Work — via Evil HR Lady, Suzanne Lucas
• Hilariously honest job posting admits the pay is ‘sh*t’ and the boss is a ‘d*ckhead’ — via Boy Genius Report
• The Pros and Cons of Mandatory Workplace Arbitration — via Abovethelaw.com
• Work/Life Balance and Lessons from Managing Two Careers — via YourHRGuy.com
• Millennials may not be the radicals you think — via Mike Haberman’s Omega HR Solutions
• Slowly but surely, workplace bullying laws are becoming a reality in the U.S. — via Minding the Workplace

Wage & Hour

• Wage and Hour Division Seeks Information on Smartphones’ Impact on Hours Worked — via The Wage and Hour Litigation Blog
• Wage-Hour Audits: Lessons Learned From Chipotle’s Heartburn — via The Wage and Hour Litigation Blog
• An Open Letter to the Department of Labor Concerning The Proposed Changes To Exemptions for White Collar Regulations — via Wage and Hour Law Update
• Third Circuit Defines “Overnight Stay” for FMLA — via Phil Miles’s Lawffice Space
• FMLA Leave: sometimes, it is about putting the pieces together — via Employer Law Report
• OSHA Publishes New Whistleblower Investigations Manual — via Employment Law Lookout
• OSHA Issues Spring Regulatory Agenda — via OSHA Law Blog
• The ACA Today: Where it Stands and How it Affects Employers — via ERC Insights Blog

Labor Relations

• General Counsel Responds to Labor Practitioners’ Questions — via Vorys on Labor
• Regional Directors Report Data on The NLRB’s Amended Election Rules After One Month – Court Challenges Continue — via Health Employment and Labor
• Video: What every new Wal-Mart employee hears about why unions are terrible — via Wonkblog
• Board Dismisses Six ULP Charges Against Am. Apparel — via Labor Relations Today
• Update: What Recent NLRB Activity Means for Employee Handbooks and Policies — via Intown Employer
• Is the NLRB is expanding its list of “inherently” concerted protected activities under Section 7? — via Employment Law Matters
• How We’re Voting on the Union, and Why — via Deadspin

A lesson on the importance of uniformity in performance standards

Under the ADA, and employer can require all employees, including disabled employees, to meet minimum qualification standards. According to the EEOC’s Q&A on Applying Performance And Conduct Standards To Employees With Disabilities, “an employee with a disability must meet the same production standards, whether quantitative or qualitative, as a non-disabled employee in the same job,” and “lowering or changing a production standard because an employee cannot meet it due to a disability is not considered a reasonable accommodation.”

What happens, however, when an employer holds a disabled employee to a higher performance standard than non-disabled counterparts? Consider Wolffram v. Sysco Cincinnati (S.D. Ohio 5/19/15).

The plaintiff in Wolffram was a diabetic, and, as a result, needed extra time for bathroom breaks during the work day. Those bathroom breaks caused Wolffram’s performance to suffer on Sysco’s electronic performance monitoring system. Because Wolffram consistently fell below the minimum performance requirements, Sysco ultimately terminated him. Nevertheless, he defeated Sysco’s summary judgment motion on his disability discrimination claim. How? Because he claimed that other non-disabled employees were given more slack on the performance standards, that other employees “cheated” the system but were not disciplined or terminated.

Employers, it’s okay to have performance standards. It’s even okay to require that each of your employees, disabled and non-disabled, meet those standards. When you start letting those standards slip, however, you become exposed to claims from disabled employees who cannot otherwise meet the requirements because of their disability. Yet another example of how the EEO laws require uniformity of application in your workplace.

“You’re late again!” “Talk to my lawyer.”

I’m timely to a fault. I hate being late, and go to great lengths to ensure that I am never tardy for anything. I think it’s annoying to those around me, or least those I live with. Just ask my kids.

Do you have the opposite problem with your employees? Do you have employees who cannot show up for work on time no matter what? Well, it appears there might be a medical explanation for their chronic lateness.

Doctors have begun diagnosing individuals with chronic lateness, a condition caused by the same part of the brain affected by those who suffer from Attention-Deficit Hyperactivity Disorder. There has even been a study published supporting this diagnosis. That’s the bad news. The good news? The American Psychiatric Association does not recognize “chronic lateness” as a condition.

Of course, just because the APA hasn’t blessed chronic lateness does not mean that employees won’t try to use it as an ADA-protected disability. And, given how broadly the ADA now defines “medical condition,” they might have an argument to make. Don’t lose too much sleep over this, however. Just because an employee has a “disability” doesn’t mean you have to accommodate it. How do you accommodate a chronically late employee? Permit them to come late and stay longer? If you work production or other shifts, for example, that’s awfully hard to do.

Can I envision a situation in which the ADA will protect a chronically late employee and require that you provide an accommodation? Maybe. But, in the grand scheme of HR issues you need to worry about, this one falls pretty low on the scale. If nothing else, it shows just how broad the ADA has become in potentially covering a wide breadth of physical and mental health issues.

Putting together the puzzle on off-duty emails and overtime

Employers, I can see the writing on the wall, and it’s not looking good for your continued reliance on your non-exempt employees using their smartphones off-the-clock.

In the past few days, this issue has picked up a ton of momentum. First, the Wall Street Journal ran an article entitled, “Can You Sue the Boss for Making You Answer Late-Night Email?” Then, the Wage & Hour Litigation Blog reported that the Department of Labor’s Wage & Hour Division announced a request for information regarding “the use of technology, including portable electronic devices, by employees away from the workplace and outside of scheduled work hours outside of scheduled work outside of scheduled work hours.” Finally, the ABA Journal reminded us that the same Wage & Hour Division will likely raise the salary floor for exemption eligibility from $23,600 a year to $50,000 a year. This significant bump in the salary test will remove a large chunk of your employees from many of the FLSA’s key overtime exemptions.

What does all this mean? It means that you need to take a long, hard, look at which of your employees you are requiring to connect when they are “off-the-clock.” If you are requiring your non-exempt employees to read and respond to emails after their work day “ends,” you need to examine whether the FLSA requires that you pay them for that time (more often than not at a 1.5 overtime premium).

I’m pretty certain that the Department of Labor consider this time compensable, but I’m not so sure. Even if reading and replying to work-related email is compensable “work,” I’m not convinced that employers should have to pay employees for it. Most messages can be read in a matter of seconds or, at most, a few short minutes. The FLSA calls such time de minimus, and does not require compensation for it. “Insubstantial or insignificant periods of time beyond the scheduled working hours, which cannot as a practical administrative matter be precisely recorded for payroll purposes, may be disregarded.” Think of the administrative nightmare if an HR or payroll department has to track, record, and pay for each and every fraction of a minute an employee spends reading an email.

Nevertheless, if you want to eliminate the risk over this issue, I suggest you consider a couple of steps:

1. Audit all of your employees for their exempt status. This audit will ensure that you have your employees properly classified as exempt versus non-exempt.
2. Consider implementing an email curfew for your non-exempt employees (which has its own pros and cons).

This issue is not going away any time soon, and illustrates the difficulty the law has keeping up with the stunning pace of technology.

For more on this important issue, I recommend Just how nervous should companies be about FLSA lawsuits over employee smartphone use? (Hint: very) via Eric Meyer’s Employer Handbook Blog.