Thursday, July 16, 2015

Who is an employee? DOL has answers in guidance on independent-contractor status


I’ve written a lot in the past year about the distinction between employees and independent contractors under federal wage-and-hour laws (here, here, here, and here).

To me, here is what it all boils down to (cribbed from my post, The “duck” test for independent contractors:

The best test to determine whether a worker is an employee or an independent contractor is the “duck” test—if it looks like an employee, acts like an employee, and is treated like an employee, then it’s an employee…. I think you know an employee when you see one.

I’ve also cautioned that it is very difficult for an employer to justify the classification of a worker as an independent contractor, and that if you exercise any control over how workers perform services for you, it is likely that they should be classified as employees, not independent contractors.

Make no mistake, this issue is of vital importance, because the mis-classification of an employee as a contractor carries with it serious implication under the FLSA, the employment discrimination laws, ERISA, tax laws, and any other laws that regulate the relationship between employer and employee.

Yesterday, the Department of Labor’s Wage and Hour Division Administrator David Weil issued a crucial Administrator’s Interpretation on this issue. Entitled, “The Application of the Fair Labor Standards Act’s “Suffer or Permit” Standard in the Identification of Employees Who Are Misclassified as Independent Contractors,” the guidance clarifies the uphill battle employers face on this issue and asserts that “most workers are employees.”

In sum, most workers are employees under the FLSA’s broad definitions. The very broad definition of employment under the FLSA as “to suffer or permit to work” and the Act’s intended expansive coverage for workers must be considered when applying the economic realities factors to determine whether a worker is an employee or an independent contractor. The factors should not be analyzed mechanically or in a vacuum, and no single factor, including control, should be over-emphasized. Instead, each factor should be considered in light of the ultimate determination of whether the worker is really in business for him or herself (and thus is an independent contractor) or is economically dependent on the employer (and thus is its employee).

What should employers do in response to this guidance? At the end of the day, nothing different than that which I’ve been suggesting for the past few years—in all but the clearest of cases, assume that everyone you pay in exchange for services is an employee, and act accordingly. This issue is squarely on the the DOL’s radar, and employers who take unnecessary risks do so at their peril.

Wednesday, July 15, 2015

Recordkeeping policies: how long is too long?


Yesterday we examined a recordkeeping issue specific to potential adverse impact claims under Title VII. Today, I want to cast the net a little wider and look at how long you need to keep a variety of documents related to your employees.

A few important points:

  1. This list is in no way meant to be exhaustive. It merely provides a snapshot of how long you need to keep some of your key documents.

  2. Mileage will vary from state to state. For example, I suggest keeping certain records for 6 years because Ohio’s statute of limitation for statutory discrimination claims is six years. If your state has  shorter filing period, then some of your recordkeeping obligations may be shorter.

  3. If you don’t have a document-retention policy, you should. If you don’t have a guideline for how long to keep certain documents, then your employees have no idea when to destroy. They may keep documents too long, or may destroy them too soon, each of which has potentially disastrous implications in litigation. If you hold too long, then you may have to produce documents that you should no longer have, and if you destroy too soon you may open yourself up to liability for spoliation (destruction) of evidence or other sanctions.

  4. Check with employment counsel on numbers 1, 2, and 3. It’s bad idea to try to manage these issues without some legal input.

Without further delay, here’s the list:

Resumés, applications, and related employment materials, including interview records and notes 6 years from date of hiring decision for non-hires and from date of termination for employees
Background checks, drug test results, driving records, company employment verifications, letters of reference and related documents 6 years from date of hiring decision for non-hires and from date of termination for employees
I-9 Forms The later of 3 years from date of hire or 1 year after termination of employment
Written contracts 8 years after expiration
Handbooks, and other policies or procedures 6 years after expiration
Collective bargaining agreements 6 years after expiration
Compensation and time records 3 years after termination
FMLA and USERRA and related leave records 3 years after termination
Performance appraisal and disciplinary action records 6 years after termination
Benefit records 6 years after filing date
OSHA and other employee safety records 5 years after termination
Workers’ compensation records 10 years after the later of the injury or illness or the close of the claim
EEO-1s 2 years after filing date
Affirmative Action Plans 2 years after close of AAP year
OSHA 300/300A 5 years after posting
ERISA 5500 6 years after filing

Tuesday, July 14, 2015

Are you up on your federal recordkeeping requirements?


The EEOC announced that is has sued a nationwide provider of janitorial and facilities management services for an alleged failure to maintain records or other information that will disclose the impact of its employee selection procedures on equal employment opportunities.

What is the EEOC talking about? According to certain federal regulations, an employer must maintain, and have available for inspection, records or other information that disclose the impact which the employer's tests and other selection procedures have upon sex, African-Americans, Native Americans, Asians, Hispanics, and Caucasians.

According to EEOC Regional Attorney Debra Lawrence, "Federal record-keeping requirements ensure that certain employers make and keep records that disclose the impact of their selection procedures. EEOC's enforcement of the record-keeping requirements is important to the agency's commitment to eliminating discriminatory barriers in the workplace."

So, if you use selection criteria or tests for hiring (criminal records, credit records, etc.), you must maintain those records for all applicants.

Tomorrow, I'll share some thoughts on the other records you should be keeping relating to your employees, and for how long you should be keeping them.

Monday, July 13, 2015

Everything you want to know about the new overtime rules in 3:44


You have to hand it to the Department of Labor. It has gotten creative to spread its message to American workers about the pending changes to the overtime rules.

Last week, the DOL published to its blog a short YouTube video entitled, White Board Explainer: What is overtime? It’s wage-and-hour Schoolhouse Rock, minus the catchy tunes.


Employers are fighting an uphill battle on this issue. A populist messsge that promises more pay for more people + a slick informational campaign = an issue that employers cannot win.

But, do employers want to win this issue? As I pointed out two weeks ago, as a practical matter employers can control whether these new overtime rules actually result in increased pay. Yet, fighting this issue will play into the hands of labor unions that they are needed to increase worker pay and to generally fight for their workplace rights. Employers need to be very wary of the unintended consequence of empowering unions, and act accordingly.

Friday, July 10, 2015

WIRTW #374 (the “bad choice” edition)


Earlier this week, I came across the following while watching the local morning news:

CJYuy7HUYAAfHct

The consumer reporter was demoing an online t-shirt business with two female station employees modeling shirts that read,”I can make you feel cheep,” and “I can take 80% off.” While this demonstration in no way rises to the level of actionable harassment, you might want to rethink your workplace culture if putting female employees in clothes that talk about their promiscuity is part of it.

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

Discrimination

HR & Employee Relations

Wage & Hour

Labor Relations

Thursday, July 9, 2015

Don’t forget leaves of absence as ADA accommodation


Suppose an employee tells you that she needs time off to undergo surgery for her recently diagnosed breast cancer. Do you?
  1. Deny the request (and fire the employee), either because you are too small to be FMLA-covered or the employee has not worked enough to be FMLA-eligible; or
  2. Consider, and likely grant, the request as a reasonable accommodation under the ADA?
If you chose option one, congratulations, you just bought yourself an EEOC lawsuit.

The EEOC’s press release fills in the details.
Joan O’Donnell successfully performed her job duties as a regional manager at the company’s BWI Dunkin’ Donuts locations. After O’Donnell was diagnosed with breast cancer, she e-mailed the owner to explain that she was diagnosed with breast cancer and would need surgery. She also talked to her supervisor about her diagnosis and requested four to eight weeks of unpaid leave for surgery, chemotherapy, and radiation treatment. The EEOC charged that Dunkin’ Donuts refused to provide a reasonable accommodation and instead abruptly discharged O’Donnell because of her disability just three days before the start of her medical leave.
I’ve written before about the need to put the human back into human resources. The EEOC agrees with me: “Granting an employee unpaid leave for needed medical treatment is not only the compassionate thing to do, it is required by federal law unless the employer can show it would pose an undue hardship.” Case closed.

Wednesday, July 8, 2015

Be conscious of inequities when gauging litigation


Four years ago, in Wal-Mart v. Dukes, the U.S. Supreme Court held that it was inappropriate to certify a nationwide class of 1.5 million female Wal-Mart employees allegedly denied pay and promotions because of a corporate-wide "policy" of sex discrimination. SCOTUS’s Dukes decision ended a decade of litigation over the propriety of the attempted nationwide class action.

More than a year after the Dukes decision, Cheryl Phipps, Bobbi Millner, and Shawn Gibbon launched a similar lawsuit in federal court in Tennessee, but instead seeking a region-wide sex-discrimination class. Wal-Mart alleged that the claims, more than a decade old, were time barred. Yesterday, in Phipps v. Wal-Mart Stores [pdf], the 6th Circuit formally disagreed.

For civil procedure geeks (like myself), the case is a fascinating read on the theory of statutes of limitations and equitable tolling. That analysis, however, is well beyond the scope of what I hope to accomplish with my little slice of the Internet.

Here’s the practical take-away. Employers favor certainty, knowing that if an employee fails to file a lawsuit 90 days after the EEOC issues its right-to-sue letter, for example, the employee waived the right to assert federal discrimination claims. Courts, however, favor equities, and try to avoid inequitable results. Sometimes, these ideals clash. When this happens, employers cannot assume victory, and should brace themselves accordingly.

Tuesday, July 7, 2015

Ohio’s odd anti-retaliation statute


Ohio’s employment discrimination law has lots of peculiarities that separate it from its federal counterpart—a six-year statute of limitations for all discrimination claims except age (which is only 6 months), individual liability for managers and supervisors, and the right for employees to file direct actions in court without first exhausting their administrative remedies, for example, stand out. Add to this list the fact that Ohio’s anti-retaliation statute is not limited to employers, but applies to anyone who retaliates:
It shall be an unlawful discriminatory practice for any person to discriminate in any manner against any other person because that person [1] has opposed any unlawful discriminatory practice defined in this section or [2] because that person has made a charge, testified, assisted, or participated in any manner in any investigation, proceeding, or hearing under sections 4112.01 to 4112.07 of the Revised Code.
In Wiltz v. Accountancy Board of Ohio, an Ohio appellate court held that a state licensing board could be liable for retaliation because of the broad definition of “person” in Ohio’s anti-retaliation statue. It was irrelevant that the defendant was not the “employer”.  So, businesses, beware and take heed. Just because you are not someone’s employer will not save you from a retaliation claim under Ohio law.

Monday, July 6, 2015

2nd Circuit becomes 2nd court to toss DOL internship test


Four years ago, the 6th Circuit, in Solis v. Laurelbook Sanitarium and School, rejected the Department of Labor’s six-factored test for determining whether an “intern” is an employee entitled to wages. In its place, the court adopted a “primary benefit” test.

At the time, the case did not garner that much attention. In the years since, however, the issue of unpaid interns has rocketed to the forefront of wage-and-hour issues on which employers need to focus. Last week, in Glatt v. Fox Searchlight Pictures [pdf], the 2nd Circuit become the 2nd federal appellate court to reject the Department of Labor’s formulaic six-factored analysis for the more flexible and nuanced primary-benefit test.

In reaching its decision, the 2nd Circuit framed the import of the issue:
When properly designed, unpaid internship programs can greatly benefit interns. For this reason, internships are widely supported by educators and by employers looking to hire well‐trained recent graduates. However, employers can also exploit unpaid interns by using their free labor without providing them with an appreciable benefit in education or experience.
Ultimately, the court sided with the employer in adopting the “primary benefit” test:

[T]he proper question is whether the intern or the employer is the primary beneficiary of the relationship. The primary beneficiary test has two salient features. First, it focuses on what the intern receives in exchange for his work.… Second, it also accords courts the flexibility to examine the economic reality as it exists between the intern and the employer.…
In the context of unpaid internships we think a non‐exhaustive set of considerations should include: 
     1. The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee—and vice versa. 
     2. The extent to which the internship provides training that would be similar to that which would be given in an educational environment, including the clinical and other hands‐on training provided by educational institutions. 
     3. The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit. 
     4. The extent to which the internship accommodates the intern’s academic commitments by corresponding to the academic calendar. 
     5. The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning. 
     6. The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern. 
     7. The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.…
The approach we adopt … reflects a central feature of the modern internship—the relationship between the internship and the intern’s formal education. The purpose of a bona‐fide internship is to integrate classroom learning with practical skill development in a real‐world setting…. By focusing on the educational aspects of the internship, our approach better reflects the role of internships in today’s economy than the DOL factors, which were derived from a 68‐year old Supreme Court decision that dealt with a single training course offered to prospective railroad brakemen
The court concluded that, in certifying a class of interns, the district court erred by applying the wrong standard (the DOL’s six factors). Thus, this decision does not mean that Fox Searchlight’s interns are not employees under the FLSA; instead, it simply means that the district court must re-evaluate its earlier decision on class certification using the primary-benefit test instead of the DOL’s six factors.

Thus, while this case is a win for employers, it does not mean that employers can rest easily on the issue of unpaid interns. Rather, it confirms that employers need to practice vigilance in classifying an entry-level worker as an unpaid intern or an employee. The focus remains on whether the “intern” is receiving training akin to, or as a part of, an academic program.
  • If the “intern” is merely performing menial entry-level tasks without an attached educational component, the worker is almost certainly an employee that must be paid. 
  • If the “intern” is working in exchange for course credit as part of a bona fide academic program, the worker is almost certainly an unpaid intern. 
The thornier question is how to classify one who is not working in exchange for academic credit, but is receiving bona fide training, in addition to making copies and Starbucks runs. For this clarity, we will need to wait for merits decision on this case and others. For now, however, the safer course of action is to err on the side of “employee” in all but the clearest of internships.

Thursday, July 2, 2015

WIRTW #373 (the “happy birthday” edition)


Happy birthday Equal Employment Opportunity Commission. The EEOC turns 50 today. While the agency and I have not always seen eye-to-eye on how it enforces our nation’s civil rights laws, we do agree on why it was founded—because all people are created equal and should enjoy the right to an equal workplace. These past few weeks—with the mass shooting in an African-American church and hateful protests over LGBT rights—serve as a stark reminder that while we have traveled a long way in the past 50 years, we still have a long way to go to achieve true equality.

And now, a birthday song.

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

Discrimination

Social Media & Workplace Technology

HR & Employee Relations

Wage, Hour, & Safety

Labor Relations

Wednesday, July 1, 2015

EEOC updates pregnancy discrimination guidance to embrace accommodations


In the wake of the Supreme Court’s decision in Young v. UPS, the EEOC has updated its administrative guidance on pregnancy discrimination. The updated guidance includes Enforcement Guidance on Pregnancy Discrimination And Related Issues, a Q&A, and a Fact Sheet for Small Businesses.

The most notable inclusion is updated guidance on an employer’s obligation to provide reasonable accommodation to a pregnant worker.
From the Q&A:
May an employer impose greater restrictions on pregnancy-related medical leave than on other medical leave? 
No. Under the PDA, an employer must allow women with physical limitations resulting from pregnancy to take leave on the same terms and conditions as others who are similar in their ability or inability to work. Thus, an employer:
  • may not fire a pregnant employee for being absent if her absence is covered by the employer's sick leave policy;
  • may not require employees limited by pregnancy or related medical conditions to first exhaust their sick leave before using other types of accrued leave if it does not impose the same requirements on employees who seek leave for other medical conditions;
  • may not impose a shorter maximum period for pregnancy-related leave than for other types of medical or short-term disability leave; and
  • must allow an employee who is temporarily disabled due to pregnancy to take leave without pay to the same extent that other employees who are similar in their ability or inability to work are allowed to do so.
Must an employer provide a reasonable accommodation to a worker with a pregnancy- related impairment who requests one? 

Yes, if the accommodation is necessary because of a pregnancy-related impairment that substantially limits a major life activity. An employer may only deny a needed reasonable accommodation to an employee with a disability who has asked for one if it would result in an undue hardship. An undue hardship is defined as an action requiring significant difficulty or expense. 

Examples of reasonable accommodations that may be necessary for someone whose pregnancy-related impairment is a disability include:
  • Redistributing marginal or nonessential functions (for example, occasional lifting) that a pregnant worker cannot perform, or altering how an essential or marginal function is performed;
  • Modifying workplace policies, such as allowing a pregnant worker more frequent breaks or allowing her to keep a water bottle at a workstation even though keeping drinks at workstations is generally prohibited;
  • Modifying a work schedule so that someone who experiences severe morning sickness can arrive later than her usual start time and leave later to make up the time;
  • Allowing a pregnant worker placed on bed rest to telework where feasible;
  • Granting leave in addition to what an employer would normally provide under a sick leave policy;
  • Purchasing or modifying equipment, such as a stool for a pregnant employee who needs to sit while performing job tasks typically performed while standing; and
  • Temporarily reassigning an employee to a light duty position.



As the new guidance makes abundantly clear, while an employer cannot compel a pregnant employee to take an accommodation (such as a leave) if she is able to perform her job, it must allow women with physical limitations resulting from pregnancy to take leave (or other accommodations) on the same terms and conditions as others who are similar in their ability or inability to work. Thus, the EEOC has confirmed, as I’ve consistently said (here and here, for example), that if employers grant employees accommodations under the ADA, Title VII will almost certainly compel them to do the same for pregnant employees.

Tuesday, June 30, 2015

Obama to announce new overtime regulations, but will they really matter?


Last night, on the Huffington Post, President Obama blogged his intentions to announce long-awaited new overtime regulations later today.

In a post entitled, “A Hard Day’s Work Deserves a Fair Day’s Pay,” the President wrote:
Right now, too many Americans are working long days for less pay than they deserve. That’s partly because we’ve failed to update overtime regulations for years—and an exemption meant for highly paid, white collar employees now leaves out workers making as little as $23,660 a year—no matter how many hours they work. 
This week, I’ll head to Wisconsin to discuss my plan to extend overtime protections to nearly 5 million workers in 2016, covering all salaried workers making up to about $50,400 next year.
So, what do we know about these new regulations?
  • The salary-level at which employees will qualify for either the administrative, executive, professional, and computer employee exemptions will increase from $23,660 a year (or $455 per week) to $50,400 (or $969.23 per week) (could they not make it an even thousand?)
  • The earliest these new regulations will take effect is sometime next year.
These rules are not final. They still must first undergo a public-comment period. Nevertheless, this announcement is the first concrete details about these long-rumored rules, and could become a key part of President Obama’s legacy, which, unlike the Affordable Care Act, will be done without Congressional approval.

These new rules will change the pay structure for millions of American workers. Yet, they may not result in the sweeping pay increases envisioned by the White House. American businesses, many of which already run leanly, need not absorb increased payroll from the switch of workers from exempt to non-exempt status. Instead, a company could simply calculate how much to pay an employee, on an hourly basis (anticipated overtime included), to reach the employee’s current salary level. Or, a company could ban overtime altogether. Thus, gross compensation probably will not change. What will change, however, is the flexibility salaried workers enjoy. Will Johnny Manager appreciate having to punch a time clock, especially if his 2016 W-2 reads the same as his 2015 W-2? And will that change undermine the authority certain employees need to have to effectively perform their jobs?

While the White House has laudable aspirations to “strengthen the middle class” and “commit to an economy that rewards hard work, generates rising incomes, and allows everyone to share in the prosperity of a growing America” in reality, it will likely be “meet the new boss, same as the old boss.”


(Update) The DOL has made available various resources (hat tip: Lawffice Space):

Monday, June 29, 2015

Equal in love, but not yet equal at work—the next frontier of LGBT rights


Friday was certainly exciting. SCOTUS surprised everyone by releasing Obergefell v. Hodges [pdf] a day earlier than expected.

In case you missed it, in a 5-4 opinion authored by swing-vote Justice Kennedy, SCOTUS held that gay marriage as a nation-wide fundamental right:

The Court now holds that same-sex couples may exercise the fundamental right to marry…. State laws challenged by Petitioners in these cases are now held invalid to the extent they exclude same-sex couples from civil marriage on the same terms and conditions as opposite-sex couples.

It follows that the Court also must hold—and it now does hold—that there is no lawful basis for a State to refuse to recognize a lawful same-sex marriage performed in another State on the ground of its same-sex character.

What is getting all the press, however, is the beautifully poetic closing paragraph of Justice Kennedy:

No union is more profound than marriage, for it embodies the highest ideals of love, fidelity, devotion, sacrifice, and family. In forming a marital union, two people become something greater than once they were. As some of the petitioners in these cases demonstrate, marriage embodies a love that may endure even past death. It would misunderstand these men and women to say they disrespect the idea of marriage. Their plea is that they do respect it, respect it so deeply that they seek to find its fulfillment for themselves. Their hope is not to be condemned to live in loneliness, excluded from one of civilization’s oldest institutions. They ask for equal dignity in the eyes of the law. The Constitution grants them that right.

What is next for LGBT rights? The right to be free from employment discrimination.

Shortly after Obergefell’s publication, Wonkblog published a stirring post calling for the end of all workplace discrimination against LGBT individuals. In that post, Wonkblog was kind enough to share this map (created by the Human Rights Campaign) of the current state of LGBT workplace-discrimination laws:

 

Where are we on this issue?

  • 21 states and the District of Columbia ban workplace discrimination on the basis of sexual orientation.
  • 18 of those states also ban workplace discrimination on the basis of gender identity.
  • Per Executive Orders, the federal government, along with its contractors and subcontractors, are also prohibited from discriminating against their employees on the basis of sexual orientation and gender identity.
  • 89 percent of the Fortune 500 include sexual orientation in their non-discrimination policies.

We have come a long way in just the past few years. Indeed, I believe that a majority of Americans now support the extension of all civil rights to the LGBT community. Yet, Congress has consistently failed to act on the Employment Nondiscrimination Act, which would extend Title VII’s coverage to sexual orientation and gender identity. SCOTUS’s ruling in Obergefell is a huge step in the right direction. Let’s hope it is a step that will lead Congress to passing the ENDA sooner rather than later.

Friday, June 26, 2015

My appearance on Stossel, now live on the Internet.


Special bonus on this fine summer Friday. If you missed my appearance on Stossel two weeks ago, Fox Business has posted the episode on its website.


You can watch it here. My segment starts at 18:39.

WIRTW #372 (the “bad work day” edition)


Next time you think you had a bad day at work, remember, at least you weren’t hit with an axe.

From Mediate:
During last Sunday’s broadcast of Fox & Friends, co-host Pete Hegseth tossed an axe to tease an upcoming segment on timbersports, missed the target, and hit a marching band percussionist standing in the distance.
Let’s go the replay:


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

Discrimination
Social Media & Workplace Technology
HR & Employee Relations
Wage & Hour
Labor Relations

Thursday, June 25, 2015

A lesson in how NOT to respond to a harassment complaint


Diana Retuerto worked in the office of Berea Moving & Storage. She claimed that the company’s owner, Willard Melton, made “verbal advances” towards her, including comments about dreams he was having about her, her physical appearance, and questions about her makeup and hair. Over time, these advances escalated to professions of love, statements about his constant need for sex, and whispers in her ear that he could not stop thinking about her. He also allegedly would rub up against her and crawl under her desk. After Retuerto reached her limit, she quit and sued for sexual harassment.

In Retuerto v. Berea Moving & Storage, the Ohio appellate court had little trouble concluding that the trial court overstepped by dismissing Retuerto’s sexual harassment claim. Of particular note is the court’s comments about the company’s lack of prompt corrective action after it learned of the harassment.
At the time Retuerto reported Melton’s behavior to her supervisor [Hawthorn] in 2010, Retuerto had not yet received an employee handbook or attended sexual harassment training. After her initial complaint to Hawthorn, Hawthorn spoke to Melton and Melton apologized to Retuerto. There is no evidence that any disciplinary action was taken against Melton. After Retuerto made additional claims in 2012, there is no evidence that Berea Moving conducted an investigation into the matter or took any disciplinary action against Melton.… 
Retuerto also averred that Hawthorn had knowledge of Melton’s ongoing behavior. Hawthorn observed and heard some of Melton’s behavior and told Retuerto that Melton was going through a “mid-life crisis.”
Obviously, condoning acts of sexual harassment as a “mid-life crisis” is a horrible idea. So, that’s what you shouldn’t do in response to a harassment complaint. What should you do?
  1. Be prompt. Upon receipt of a complaint of harassment, a business must act as quickly as reasonably possible under the circumstances to investigate, and if necessary, correct the conduct and stop from happening again.
  2. Be thorough. Investigations must be as comprehensive as possible given the severity of the allegations. Not every complaint of offensive workplace conduct will require a grand inquisition. The more egregious allegations, however, the more comprehensive of an investigation is called for.
  3. Consider preliminary remedial steps. While an investigation is pending, it is best to segregate the accused(s) and the complainant(s) to guard against further harassment or worse, retaliation. Unpaid suspensions can always retroactively be paid, for example, and companies are in much worse positions if they are too lax instead of too cautious.
  4. Communicate. The complaining employee(s) and the accused employee(s) should be made aware of the investigation process—who will be interviewed, what documents will be reviewed, how long it will take, the importance of confidentiality and discretion, and how the results will be communicated.
  5. Follow through. There is nothing illegal about trying remedial measures less severe than termination in all but the most egregious cases. A valued employee may be no less valued after asking a co-worker about her underwear, for example. If the conduct continues, however, the discipline must get progressively more harsh. If you tell an employee that termination is the next step, you must be prepared to follow-through. 
And, please, please, please, make sure that your employee handbooks have an anti-harassment policy, and that you are training your employees on it. 

Wednesday, June 24, 2015

Yes, GINA covers cheek swabs, even ones to uncover employee misconduct


I’ve always said that employment law is a dirty job, and this case more than proves my point.

Atlas Logistics Group, a Georgia food-storage company, had a big problem. One of its employees began habitually defecating in its warehouse. (In case you’re curious, the scientific name for this disorder is voluntary encopresis, one who has control over when and where bowel movements occur and chooses to have them in inappropriate places.)


To solve its mystery, Atlas required its employees to submit to a cheek swab, after which a lab compared DNA samples from the employees’ swabs to DNA from the offending fecal matter. Two employees, Jack Lowe and Dennis Reynolds, whose DNA did not match, filed suit under the Genetic Information Nondiscrimination Act.

Last month, a federal court granted summary judgment in favor of the employees, concluding that 1) GINA unequivocally covers the DNA tests conducted on their cheek-swab samples, and 2) the employer violated the statute by requesting and collecting the employees’ genetic information.

With liability already established, earlier this month, the parties tried the employees’ damages claims. And, the jury came back with a big number — $2,225,000 — including $225,000 and $250,000 in compensatory damages for the two plaintiffs, and $1,750,000 in punitive damages.

To me, this employer’s actions are not all that outrageous or inappropriate. It asked employees who were in the area of the found feces to submit to swabs of their cheeks. It neither asked for stool samples or for them to bend over and cough. Could the employer have taken a less intrusive measure, like installing hidden cameras? Sure. But, it did what it thought was reasonable under the circumstances to catch its predator. Unfortunately, however, a DNA test is still a DNA test, which runs afoul of GINA.

While I’m not offended by these tests, the jury clearly was. Over $200,000 per employee in compensatory damages? For a q-tip in the mouth? And $1.75 million in punitive damages? Why was this jury so outraged? Because their sense of privacy was offended. While social media seems to be eroding the innate nature of what “privacy” means, this verdict tells us that medical and genetic information are different.

So, employers, tread lightly when dealing with your employees’ genetic information. One case does not make a trend, but $2,225,000 (albeit one that should be reduced to $600,000 per the civil-rights law’s damage caps) in enough to make any employer stand up and take notice that genetic information discrimination is here to stay.

Tuesday, June 23, 2015

Just because lone acts of harassment aren’t always actionable doesn’t mean you should ignore them


By now, you’ve likely heard of the furor over the Confederate flag following the horrific church massacre in Charleston, South Carolina. You haven’t? Well, watch this, from Last Week Tonight with John Oliver, and then let’s talk.


What are you to do if you have employees who like to display the Confederate flag at your workplace (think belt buckles, or do-rags, or maybe even small flags, or pictures thereof, in offices or cubicles)? Do you: a) permit it because solitary acts of harassment that are overtly severe or offensive likely are not actionable under Title VII; or b) prohibit it because it might make your African-American employees uncomfortable, or worse, offend them (heck, even South Carolina and Wal-Mart have relented on the issue)?

If we’re talking about a Confederate flag (or flags) as part of a deeper pattern of harassment, which includes other, more overt, acts, like nooses, monkeys, and racist language (like in this case), then it’s a no-brainer. You investigate, fire the offending employee(s), and institute some serious, heavy duty anti-harassment training. If you think you should do anything else, we need to have a serious talk.

But, if we’re talking just about a Confederate flag, without anything more, what are you to do? Ban, or not ban? 

I’m not suggesting you need a “no Confederate flag” policy, but, if you see, or learn of, an employee displaying this charged symbol, I suggest that you require its removal. You would not permit an employee to display a Nazi flag because of its very clear anti-Jewish meaning. For many African-Americans, the Confederate flag holds the same meaning. So, because you want a harmonious and inclusive workplace, you do the right thing, even if doing the wrong thing may not necessarily be illegal.

Monday, June 22, 2015

What’s next for Uber after independent-contractor loss?


In March, I reported on a lawsuit filed against Uber by a class of its drivers claiming that the taxi company mis-classified them as independent contractors. Apparently, that is not the only claim pending against Uber on this very issue. Earlier this month, a California Labor Commission hearing officer concluded that Uber had mis-classified one of its drivers. Uber has appealed the ruling. Frankly, I think Uber has a pretty good argument on appeal.

Here’s the full decision [pdf].

 

The hearing officer relied on the following factors to conclude that Uber’s drivers are employees, not independent contractors (with my critique in the parenthetical).
  • Drivers must provide Uber their personal address, banking information, and social security number. (Doesn’t a company want contact info for anyone providing services for it, and doesn’t it need other information so it can pay its contractors?)
  • Drivers cannot drive for Uber without a background check. (If a background check is the standard for an employee, then we might as well get rid of independent contractors all together.)
  • Drivers must register their cars with Uber, which cannot be more than 10 years old (Cannot a company set reasonable standards for its contractors?)
  • Uber monitors drivers’ ratings from passengers, and terminates the relationship if the rating falls below 4.6. (Contractors are not guaranteed contracts for life; if a contractor falls below certain standards, a company always has the right to terminate the relationship.)
  • Uber requires drivers to use its app to drive, and they cannot drive without using it. (How is this different than a taxi company tracking its drivers via GPS and directing routes; if anything, Uber drivers have more independence because they can turn down the fare at any time.)
  • Drivers are paid a set percentage of the total cost of each ride. (Isn’t this the hallmark of an independent contractor—pay by the job, not by the hour?)
Last week, I called for a “duck” test for independent contractors. Dear readers, Uber drivers absolutely look, swim, and quack like independent contractors. They control when and where they work; they are paid by the ride; they drive their own cars and are responsible for their own expenses; Uber does not supervise the drivers, but merely holds them to reasonable performance standards. If Uber’s drivers are employees, then what is left for independent contractors? Or, is this the beginning of the end of the ability of companies to use the services of contractors? 

Friday, June 19, 2015

WIRTW #371 (the “no more pencils…” edition)


I love school. I mean, I loved school when I was a student, but now that I work, and my wife works, I really love when my kids are in school. It means that I don’t have to expend any energy thinking about how they are going to spend their days. The bus picks them up and drops them off, period. Now that school’s out, however, we have to manage sitters and camps, and getting them to and from sitters and camps. So, we’ve spent the past two weeks dropping off and picking up at camp (which, for me, is 45 minutes from work, without traffic).

How do other employees, and their employers, cope with this seasonal time-management dance? Read “School’s Out!” Means More Free Time for Kids, But None for Working Parents. Here is Help for Employers Managing the Fallout. — via Employment Law Watch

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

Discrimination
Social Media & Workplace Technology
HR & Employee Relations
Wage & Hour
Labor Relations
Until next week…