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On second look, Supreme Court upholds UT Austin’s consideration of race for some admissions

June 24th, 2016  |  Cynthia L. Hackerott  |  Add a Comment

Addressing the case for a second time, the U.S. Supreme Court held, 4-3, that the University of Texas at Austin’s (UT Austin) consideration of race in a portion of its admissions decisions was lawful under the Equal Protection Clause of the Fourteenth Amendment. Of note, the Court advised that the university does have a continuing obligation to satisfy the strict scrutiny burden by periodically reassessing its admission program’s constitutionality, and efficacy, in light of the school’s experience and the data it has gathered since adopting its admissions plan, and by tailoring its approach to ensure that race plays no greater role than necessary in meeting its compelling interests. Justices Ginsburg, Breyer, and Sotomayor joined in Justice Kennedy’s majority opinion. Justice Alito’s dissent was joined by Chief Justice Roberts and Justice Thomas. Justice Thomas also wrote a separate dissent. Justice Kagan took no part in the consideration or decision of either the most recent petition or the Court’s June 2013 decision in this case due to her involvement with it when she was the U.S. Solicitor General. (Fisher v. University of Texas at Austin, Dkt No 14–981, June 23, 2016)

In a 2013 ruling, the High Court found that lower courts had erred in giving deference to the university’s assertion that its consideration of race in the admissions process satisfied the narrow tailoring prong of strict scrutiny (97 EPD ¶44,850). On remand, a Fifth Circuit panel ruled, 2-1, that UT Austin presented sufficient evidence to prove that its admissions program is narrowly tailored to achieve the compelling state interest of the educational benefits of diversity (98 EPD ¶45,109). The Fifth Circuit denied Fisher’s request for an en banc rehearing. This time, the Supreme Court affirmed the Fifth Circuit’s decision.

Relevant precedent. While the cases arose in the context of higher education, the ultimate outcome of the case could have a significant impact on the use of affirmative action in a number of areas, including employment and government contracting. Prior to its 2013 decision in the present case, the last time the High Court addressed the issue of affirmative action in higher education admissions was in June 2003 when it upheld, by a 5-4 vote, the University of Michigan’s consideration of race as one of many “plus factors” in its law school admissions policy that considered the overall individual contribution of each candidate (Grutter v Bollinger, 84 EPD ¶41,415).

In contrast, on that same day in a 6-3 decision, the Court held that the University of Michigan’s undergraduate admissions policy, which automatically awarded points to applicants from certain racial minority groups, violated the Equal Protection Clause (Gratz v Bollinger, 84 EPD ¶41,416). Previously in Regents of Univ of Cal v Bakke (17 EPD ¶8402 (1978)), Justice Powell wrote in his solo opinion that the attainment of a “diverse student body” is a compelling state interest for an institution of higher education. The Court endorsed this position in Grutter, and found that the law school’s policy was narrowly tailored to achieve the compelling state interest of a diverse student body, but found in Gratz that the undergraduate policy was not.

Texas policy. UT Austin uses an undergraduate admissions system containing two components, Justice Kennedy explained. First, as required by Texas’ Top Ten Percent Law, it offers admission to any students who graduate from a Texas high school in the top 10 percent of their class. It then fills the remainder of its incoming freshman class, roughly 25 percent, by combining an applicant’s “Academic Index”—the student’s SAT score and high school academic performance—with the applicant’s “Personal Achievement Index,” a holistic review containing numerous factors, including race. The University adopted its current admissions process in 2004, after a year-long-study of its admissions process—undertaken in the wake of Grutter and Gratz—led it to conclude that its prior race-neutral system did not reach its goal of providing the educational benefits of diversity to its undergraduate students.

Abigail Fisher, a white Texas resident, sued the university after being denied a spot in 2008. Because she did not graduate in the top ten percent of her high school class, she did not qualify for automatic admission under the Top Ten Percent Plan; rather, she was considered under the holistic review program. Fisher alleged that the university’s consideration of race as part of its holistic review process disadvantaged her and other Caucasian applicants, in violation of the Equal Protection Clause.

Controlling principles. The Court’s 2013 ruling in Fisher I (also written by Justice Kennedy) set forth three controlling principles for assessing the constitutionality of a public university’s affirmative action program. First, a university may not consider race “unless the admissions process can withstand strict scrutiny,” i.e., it must show that its “purpose or interest is both constitutionally permissible and substantial, and that its use of the classification is necessary” to accomplish that purpose. Second, “the decision to pursue the educational benefits that flow from student body diversity is, in substantial measure, an academic judgment to which some, but not complete, judicial deference is proper.” Third, when determining whether the use of race is narrowly tailored to achieve the university’s permissible goals, the school bears the burden of demonstrating that “available” and “workable” “race-neutral alternatives” do not suffice.

Percentage plan unchallenged. Here, UT Austin’s approach to admissions gave rise to “an unusual consequence,” Kennedy observed. The component with the largest impact on Fisher’s chances of admission was not the school’s consideration of race under its holistic review process but the Top Ten Percent Plan. Because she did not challenge the percentage part of the plan, the record is devoid of evidence of its impact on diversity. Yet, remand for further factfinding would serve little purpose because, at the time she applied for admission, the current plan had been in effect only three years and, in any event, the university lacked authority to alter the percentage plan, which was mandated by the Texas Legislature. These circumstances refuted any criticism that UT Austin did not make good faith efforts to comply with the law.

Obligation to engage in ongoing review. Nevertheless, the university has a continuing obligation to satisfy the burden of strict scrutiny in light of changing circumstances, the Court cautioned. “The Court’s affirmance of the University’s admissions policy today does not necessarily mean the University may rely on that same policy without refinement,” it said. To this end, the university must tailor its approach in light of changing circumstances through regular evaluation of data and consideration of student experiences, all the while ensuring that race plays no greater role than is necessary to meet its compelling interest.

“The type of data collected, and the manner in which it is considered, will have a significant bearing on how the University must shape its admissions policy to satisfy strict scrutiny in the years to come,” Kennedy wrote.

Noting that UT Austin engages in periodic reassessment of the constitutionality, and efficacy, of its admissions program, the Court advised that “[g]oing forward, that assessment must be undertaken in light of the experience the school has accumulated and the data it has gathered since the adoption of its admissions plan.”

“As the University examines this data, it should remain mindful that diversity takes many forms,” the Court continued. “Formalistic racial classifications may sometimes fail to capture diversity in all of its dimensions and, when used in a divisive manner, could undermine the educational benefits the University values.”

Compelling interest. The issue currently before the Court, however, was necessarily limited to the narrow question of whether Fisher has shown by a preponderance of the evidence that she was denied equal treatment at the time her application was rejected. This she failed to do.

Rejecting her claim that the university did not articulate its compelling interest with sufficient clarity because it has failed to state more precisely what level of minority enrollment would constitute a “critical mass,” the Court explained that the compelling interest that justifies consideration of race in college admissions is not an interest in enrolling a certain number of minority students, but an interest in obtaining “the educational benefits that flow from student body diversity.” Given that the university is prohibited from seeking a particular number or quota of minority students, it cannot be faulted for failing to specify the particular level of minority enrollment at which it believes the educational benefits of diversity will be obtained.

Still, asserting an interest in the educational benefits of diversity writ large is insufficient, the Court cautioned. A university’s goals cannot be elusory or amorphous; rather, they must be sufficiently measurable to permit judicial scrutiny of the policies adopted to reach them.

In this case, UT Austin articulated concrete and precise goals— including ending stereotypes, promoting “cross-racial understanding,” preparing students for “an increasingly diverse workforce and society,” and cultivating leaders with “legitimacy in the eyes of the citizenry”that mirror the compelling interest the Court has approved in prior cases. Moreover, the university gave a “reasoned, principled explanation” for its decision in a 39-page proposal written after a year-long study revealed that its race-neutral policies and programs did not meet its goals.

Narrow tailoring. The Court was also disagreed with Fisher’s assertion that UT Austin need not consider race because it had already “achieved critical mass” by 2003 under the Top Ten Percent Plan and race-neutral holistic review. The university studied and deliberated for months, concluding that race-neutral programs had not achieved the university’s diversity goals, a conclusion supported by significant statistical and anecdotal evidence.

In addition, the Court was not persuaded by Fisher’s argument that it was unnecessary to consider race because such consideration had only a minor impact on the number of minority students the school admitted. The consideration of race here has had a meaningful, if still limited, effect on freshman class diversity, the Court pointed out. That race consciousness played a role in only a small portion of admissions decisions should be a hallmark of narrow tailoring, not evidence of unconstitutionality, Kennedy wrote.

Finally, the Court was unconvinced by Fisher’s argument that there were numerous other race-neutral means to achieve the university’s goals. The record showed that, as of the time of her application, none of those alternatives was a workable means of attaining the university’s educational goals.

Alito dissent. “Something strange has happened since our prior decision in this case,” Justice Alito wrote in the first line of his 51-page dissent. In Alito’s view, UT Austin failed to meet requirements of strict scrutiny demanded in Fisher I.  “Even though UT has never provided any coherent explanation for its asserted need to discriminate on the basis of race, and even though UT’s position relies on a series of unsupported and noxious racial assumptions, the majority concludes that UT has met its heavy burden,” Alito asserted, adding, “This conclusion is remarkable—and remarkably wrong.”

Thomas dissent. While joining Alito’s dissent, Justice Thomas wrote a separate, two-paragraph dissent to reaffirm his opinion (articulated in his concurrence in Fisher I) that a state’s use of race in higher education admissions decisions “‘is categorically prohibited by the Equal Protection Clause.’” According to Thomas (again quoting his Fisher I concurrence), “that constitutional imperative does not change in the face of a ‘faddish theor[y]’ that racial discrimination may produce ‘educational benefits.’” Therefore, he would overrule Grutter and reverse the Fifth Circuit’s judgment in the present case.

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Fire captains were primarily first responders, so entitled to overtime pay

June 23rd, 2016  |  Ron Miller  |  Add a Comment

Fire captains whose primary duty was to serve as first responders in case of fires and other emergencies, were not exempt executives or administrators as alleged by their employer, and were entitled to overtime compensation under the FLSA, ruled the Fourth Circuit in the recent ruling in Morrison v. County of Fairfax, Virginia.

Under the FLSA’s so-called “white collar” exemptions, workers “employed in a bona fide executive, administrative, or professional capacity,” are exempt from the overtime protections afforded by the Act. However, such exemptions are to be narrowly construed against the employer.

First responder regulation. In 2004, DOL proposed changes to its “Part 541” regulations governing the white collar exemptions, generating concerns that first responders and manual laborers would become exempt employees and lose their right to overtime pay. In response, the DOL promulgated a new regulation, 29 C.F.R. Sec. 541.3, clarifying the scope of the exemptions as applied to blue collar workers and first responders. Subsection (b) of the “first responder regulation” provides in its first part that the Part 541 exemptions “do not apply to . . . fire fighters” and other first responders, “regardless of rank or pay level.”

Application of regulation. The responder regulation was put to the test in this case, in which over 100 current and former captains brought suit against the employer for the denial of overtime pay. Under the hierarchy of the Fairfax County Fire and Rescue Department, the fire captains were five ranks down from the fire chief, reporting directly to battalion chiefs. Fire captains, along with positions above that rank, were treated as exempt from the overtime pay requirements of the FLSA.

A federal district court held that all fire captains were exempt executives. It held the first responder regulation inapplicable to the captains, on the ground that it addresses only “blue collar” firefighters. On appeal, the employer took a different approach, arguing that some of the captains are exempt executives while others are exempt administrators.

Primary duty. While captains spend time on tasks that are distinct from their front-line responsibilities, such as completing annual evaluation reports on firefighters, they have no authority to administer discipline without the approval of a battalion or deputy chief. Similarly, captains do not write or disseminate station policies. Further, they do not set or control the budget, hire or fire employees, set minimum staffing levels, change employees’ work schedules, or approve overtime.

The Fourth Circuit began its analysis with the first responder regulation. Here, the employer did not dispute that the captains qualified under the first paragraph of Section 541.3(b) as “fire fighters” who “perform work such as preventing, controlling or extinguishing fires.” The appeals court concluded that the district court erred in conflating the first subsection of the regulation, addressing “blue collar” and manual laborers, with the second, covering first responders. The court found that there was no basis for treating the two subsections as overlapping. Rather, it noted that the separate subsections are clearly delineated, with the first providing that the exemptions in question do not apply to blue collar employees, and the second that the exemptions “also do not apply” to first responders. Thus, the first responder regulation applied to this case.

“Primary duty” standard. Nevertheless, the parties did agree that under the first responder regulation whether firefighters are exempt executives or administrators is governed by the “primary duty” standard, under which the captains are exempt if (and only if) their primary duty is “management,” or administrative work “directly related to . . . management.” Like the Second Circuit in Mullins v. City of New York, the Fourth Circuit deferred to the Secretary’s interpretation of his agency’s regulation. Thus, the court found that reading the first responder regulation to incorporate the well-established primary duty test did not render the regulation meaningless.

Clear and convincing evidence. Thereafter, the appeals court found that the record did not contain evidence from which a reasonable jury could find that the employer had met its burden of showing, by clear and convincing evidence, that the captains were covered by the Part 541 exemptions. Rather, taking full account of the character of the employees’ job as a whole, there was no showing that the captains’ primary job duty was anything other than emergency response. First, although captains had certain administrative duties, it was clear that fighting fires was the more important part of the job. The court pointed out that although the captains spent very little of their time responding to emergency calls, it was illogical to give much weight to how much time a captain devoted to answering emergency calls. The nature of the job was that a fire fighter’s day may consist of extended periods of boredom, punctuated by periods of urgency and moments of terror. At any rate, the employer produced no evidence of how much time the captains spend performing exempt management work. Accordingly, the captains were entitled to summary judgment on their claim for overtime compensation.

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It’s not just about you—New Jersey public policy bars shortened limitations period for state discrimination claims

June 21st, 2016  |  Joy Waltemath  |  Add a Comment

Although stressing that it was all for freedom to contract, the New Jersey Supreme Court came out forcefully June 15 in support of the “public imperative in eradicating discrimination” by not allowing a contractual provision in an employment application to shorten the otherwise two-year statute of limitations in the New Jersey Law Against Discrimination to six months.

The case involved a worker whose first language was not English and who took the application home to have a neighbor translate it before he could fill it out. He was hired as a helper, eventually promoted to driver, and a couple of years later, injured his knee on the job, which required surgery and physical therapy. Two days after he returned to work full-time, he was fired in what the company said was a reduction in force. Not believing that was the case because others with less seniority were retained, the worker sued seven months later, claiming disability discrimination. Both the trial and appellate courts held that the statement in his job application waiving the statute of limitations in favor of a six-month limitations period was clear and unambiguous and was neither unreasonable nor against public policy.

It’s not just about you. But the unanimous state supreme court wasn’t about to view this as a purely “private contractual agreement by which private parties contract to limit private claims by shortening the generally applicable statute of limitations.” Reversing, the court said that while the lawsuit was based on an employment relationship, “it is not a simple private claim.” Instead, the worker alleged an LAD violation—“a law designed for equal parts public and private purposes.”

It’s about a public interest. In fact, the court gave a little history lesson, pointing out that the LAD was first enacted in 1945; it was an express exercise of the state’s police powers; it recognized nothing less than a civil right; and it “declared abhorrence to discrimination.” Plus, the state legislature further found that “because of discrimination, people suffer personal hardships, and the State suffers a grievous harm.” Among other things, the court also pointed to the LAD’s “huge incentive for employers to thoroughly investigate and respond effectively to internal complaints in order to limit or avoid liability for workplace discrimination.” In fact, the court said that “responsible employers are partners in the public interest work of eradicating discrimination.”

While the court cited other reasons for its decision (23 years of a court-supplied two-year statute of limitations for LAD claims, which the legislature had not disturbed; the dual-forum procedure for bringing claims either to the Division of Civil Rights within six months or in court within two years; and that a shortened limitations period could either foreclose meritorious claims or force lawyers to bring inadequately investigated, potentially nonmeritorious claims too quickly), the thrust of the court’s decision was premised on the public interest.

Public and private interests “cannot be divorced.” Said the court, “a contractual limitation on an individual’s right to pursue and eradicate discrimination of any form prohibited under the LAD is not simply shortening a limitations period for a private matter. If allowed to shorten the time for filing plaintiff’s LAD action, this contractual provision would curtail a claim designed to also further a public interest. As to the LAD, there is a marriage of interests that cannot be divorced.”

A couple of other states (Kansas, California) have taken a similar public policy approach, but more have not, as cases from Kentucky, Michigan, New York, and Texas have found a six-month limitations period reasonable, and that’s all that was required. A federal district court in Utah went so far as to suggest that “protecting the integrity of the contractual process” provides a countervailing public policy. But to the unanimous New Jersey high court, which explicitly recognized that “there was no bargaining here” in an employment application that “plainly involved a contract of adhesion,” the public interest in eradicating discrimination was the far better policy to elevate.

The case is Rodriguez v. Raymours Furniture Co., Inc.

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Ten things employers can learn from recent FMLA suits

June 16th, 2016  |  Lorene Park  |  Add a Comment

By Lorene D. Park, J.D.

Even decades after the Family and Medical Leave Act was enacted, employers are still making basic mistakes, such as presuming that an employee who wants FMLA leave has to use the word “FMLA,” failing to properly calculate FMLA allotment or use, and disparaging those who take leave. Perhaps managers find some provisions unclear or simply need a refresher. Along those lines, here are 10 “takeaways” from recent court decisions over alleged FMLA mistakes.

1.            When calculating FMLA entitlement, include overtime and “working lunches.” An employee’s actual workweek is the basis for determining FMLA leave entitlement. This means overtime and breaks that were spent working must be included when calculating an employee’s FMLA entitlement. In one recent case, the Eighth Circuit held that, although a tire manufacturing employee had the choice of whether to put his name down for certain overtime shifts, the overtime became mandatory once he did that and was selected for a shift, so the overtime should have been included in calculating his allotment of FMLA leave for the year. Given that his overtime hours varied from week to week, the employer should have calculated his leave in accordance with 29 C.F.R. §825.205(b)(3). Instead, the overtime hours were not considered at all. His FMLA interference claim would therefore go to trial.

In another case, a corrections department counselor claimed understaffing kept him from eating in the employee lunchroom and he had to eat where inmates congregated. This, ruled a federal court in Illinois, raised a question on whether his lunches were spent predominantly benefitting his employer and should have been included in calculating whether he met the 1,250-hour requirement. Also at issue was whether the employer knew of his working lunches: 29 C.F.R. §785.11 states that unrequested work is work time if the employer “suffer[s] or permit[s]” the work and “knows or has reason to believe” the employee is working.

2.            In calculating amount of leave used—don’t include days an employee is not scheduled. Be careful in calculating how much FMLA leave has been used—FMLA leave may be taken in periods of weeks, days, hours, and sometimes less than an hour. The employer must allow employees to use FMLA leave in the smallest increment it allows for other forms of leave, as long as it is no more than one hour. When calculating the amount of leave used, exclude days an employee would not be working (e.g., weekends, temporary plant closures, holidays).

One employer faces trial for including weekends in calculating an employee’s FMLA usage (she worked Monday through Friday) and firing her when it thought her leave was used up. The company thought it was “simple math” that her periods of leave in 2013 totaled 12 weeks (84 days) as of December 15, but a federal court in Tennessee disagreed. Weekends were not to be counted, so the total was 60 days and she had not exhausted her FMLA leave by December 15. Also rejected was the employer’s argument that the plant closes for the holidays so she would have soon exhausted her leave anyway. “If the employee is not scheduled to report for work, the time period involved may not be counted as FMLA leave,” the court noted, quoting the DOL’s response in the Federal Register to a comment.

3.            Neither a medical emergency nor a request using the word “FMLA” is required. One employee won summary judgment as to her employer’s liability for FMLA interference after a federal court in Pennsylvania rejected the employer’s argument that FMLA leave is limited to medical emergencies. The court found it undisputed her parents had a serious health condition and she was entitled to family care type leave to make arrangements for their transition in care. It also found that her need for leave was unforeseeable and she was only required to give notice as soon as practicable—it was enough that she said her “dad was ill, and she had to get the house ready for him to come home” from the “hospital.”  If the employer wanted more information on her parents’ health, it could have asked.

As to notice of the employee’s own health condition and need for leave, if there is a known history and the employee shows symptoms at work, that could be enough under the FMLA. It is up to the employer to learn more. For example, an employee with a history of migraines avoided summary judgment after a federal court in Missouri found that a sick log stating she was absent for “headache” may have triggered the employer’s duty to investigate; instead, it fired her under its attendance policy. In another case, a truck driver receiving treatment for high blood pressure had chest pains and, believing he might be having a heart attack, asked a coworker to tell the manager he was leaving. He was considered a “voluntary quit” since he failed to notify the manager himself, but a federal court in Maryland found triable issues on whether he provided sufficient notice of the need for FMLA leave.

4.            Give employees a chance to provide certification. Employers may require employees to provide a medical certification of the need for FMLA leave, but lawsuits often arise if the certification is found deficient.  The Second Circuit recently revived an employee’s FMLA claims against an employer and an HR director responsible for a communication breakdown that led to the employee’s discharge. The employee provided certification that she needed to care for her son who was hospitalized with diabetes. After he broke his leg, she sent a new FMLA request for leave through July 9 and repeatedly asked if more information was needed. She heard nothing until she received a July 17 letter stating her paperwork did not justify her absences. She sent emails asking what “paperwork” was needed, but the HR director simply sent a DOL brochure and refused to let her return absent proper documentation. She was fired for job abandonment. To the appeals court, a jury could find the employee made good faith efforts and was thus relieved of her duty to provide certification.

In a case out of Illinois, a staffing agency was denied summary judgment on an FMLA interference claim because it fired the employee one day after requesting her medical certification. An employer may deny leave absent timely certification, explained the federal court, but 29 C.F.R. §825.305(b) defines timeliness to be 15 calendar days from the request for certification. It also requires the employer to warn the employee in writing of the consequences of failing to timely return a certification, and that was not done here.

5.            Communicate with employees. As indicated by the HR director’s inadequate responses to an employee’s questions in the Second Circuit case above, it is important to keep a dialogue with employees who request information about their FMLA obligations. It is also important to communicate regarding their job status or what they can expect to change due to their absence. For example, a federal court in Arizona held an employer liable for liquidated damages under the FMLA because it failed to answer a pregnant sales rep’s questions about how her accounts and commissions would be handled during her maternity leave. By not responding to repeated inquiries over seven months, the company essentially forced her to guess as to the professional consequences she would suffer in terms of lost commissions and transferred accounts, reflecting a lack of good faith and willful indifference to the FMLA.

6.            You can require the use of customary notice procedures for absences, but with caveats. Cases regularly crop up where employees have been denied leave or disciplined for not following call-in procedures for potentially FMLA-qualifying absences. Employers need to consider if the need for leave was unforeseeable. If it was unforeseeable, employees need only provide notice of the need for FMLA leave “as soon as practicable,” though employers may generally require them to follow normal call-in procedures. In one case, an employee’s bipolar medication interfered with sleep and she overslept, failing  to call in an absence before her morning shift. In the opinion of a federal court in Kansas, a jury could find that calling in late was “as soon as practicable” and that the employer interfered with FMLA rights by firing her for tardiness and absences.

In other cases, where employees have no excuse for failing to follow call-in procedures, their FMLA claims usually fail. For example, a Michigan welder had his FMLA claim tossed because he had no good reason for not calling in his late arrival. The federal court found that his deposition testimony providing only “conjectural justifications” such as he was probably suffering an anxiety attack at the time, were not enough to avoid summary judgment. The result was the same for a Delta flight attendant based in Utah who was fired for violating airline policy by accepting an assignment and then canceling without sufficient notice.

7.            Avoid derogatory remarks about those who take leave. If there’s one thing that’s going to make a plaintiff’s case easier in proving unlawful intent, it is a manager’s or decisionmaker’s derogatory remarks about a statutorily protected activity. In one case from a federal court in Indiana, an employee was previously disciplined for excessive absences and was subject to a last chance agreement, but he still survived summary judgment on his FMLA claims, which were supported by his supervisor’s disapproving remarks about his need for leave, including that he was on “thin ice” and was “burying himself.” In a federal case out of Illinois, a car salesman who was fired 13 days after returning from FMLA leave for heart surgery won an extra $308,240 in liquidated damages on his FMLA retaliation claim after the employer failed to show it acted in good faith. Significantly, his visible heart pack was treated with open disdain by his supervisor, and he was told “don’t die at the desk or I am going to drag you outside and throw you in the ditch.” He was also threatened with demotion.

8.            Be consistent in your treatment of employees before and after leave. A change in the way an employee is treated after FMLA leave may be considered evidence that the leave was a negative factor in any disciplinary action. In one case, an employee claimed that as she took more FMLA leave, her new supervisor began to “watch her like a hawk,” then gave her warnings for allegedly violating attendance and personal phone usage policies, eventually placing her on two performance improvement plans and firing her. This was enough, ruled a federal court in Illinois, to state a plausible FMLA retaliation claim. In another case, a federal court in Michigan denied summary judgment based largely on evidence that an employee received a positive performance review before her FMLA leave, but afterwards was disciplined and terminated for poor performance, along with evidence that the employer skipped a step in its progressive discipline policy and created an after-the-fact paper trail documenting misconduct that purportedly occurred months earlier.

9.            Adjust goals downward for employees who take FMLA leave. While it is important to be consistent in how you treat an employee before and after FMLA leave–and as compared to others, it is also important to adjust time-sensitive goals for those who take FMLA leave. For example, evidence offered by an account executive that her company didn’t adjust her sales targets to account for her intermittent FMLA absences and then fired her for failing to meet her goals raised an issue for trial on whether she was actually fired for taking FMLA leave, ruled a federal district court in New Hampshire. Similarly, a court in Tennessee denied summary judgment on FMLA claims by an employee who took intermittent leave to care for her daughter, based in part on evidence that the employer refused to let coworkers help her meet her goals, nitpicked her work, faulted her for missing goals when she took leave, and treated similarly situated employees who missed goals better than it treated the employee.

10.          Not every deviation from what you expect of a seriously ill person suggests FMLA abuse. It’s one thing if an employee posts Facebook pictures of his vacation in St. Martin during FMLA leave—a federal court in Florida held that an employee who did just that failed to show he was fired for taking FMLA leave rather than for his conduct while on leave. Usually, though, suspected FMLA abuse isn’t so clear, so employers must tread carefully. In one case, a kitchen manager told his employer he was ill with blood in his stool and planned to go to the hospital or health department. Instead, he walked to a diner, had coffee, then drove home, contacting the health department the next day (he was diagnosed with colitis and diverticula and was treated for two years). Though he was fired for walking off the job, a federal court in Tennessee found triable questions on whether he gave notice of an FMLA-qualifying condition and triggered a retaliatory action. In a case out of Maine, a long-time employee approved for intermittent leave due to chronic anxiety told his employer he was taking the rest of the day off. He ran into a coworker and they had lunch. Coworkers notified HR, which had him watched. He was suspended for “possible FMLA fraud” and then fired. The federal court held that he stated a plausible FMLA retaliation claim.

Other recent developments of note. In terms of case law, a recent ADA case bears mentioning because it highlights the confusion experienced by some employers concerning the potential overlap in their obligations under the ADA and the FMLA when an employee requests medical leave as an accommodation. In particular, it is important to note that an employee who has exhausted his or her FMLA leave may still be entitled to medical leave under the ADA. As explained by a federal court in Florida, granting the full 12 weeks of FMLA leave may not satisfy an employer’s independent duty to accommodate an employee’s disability under the ADA, such as through additional (though not indefinite) medical leave. Thus, the FMLA does not supplant the ADA when it comes to granting medical leave as an accommodation.

Agency developments should also be noted, including the Department of Labor’s announcement of a new FMLA notice poster that employers will be required to post in their workplaces and a new employer guide designed to provide essential information on FMLA obligations. The DOL also recently issued a fact sheet on the joint employment relationship and the corresponding FMLA responsibilities of primary and secondary employers, including both an example and a chart to illustrate specific responsibilities. More information is available on the Department of Labor’s website, including posters; e-Tools; and fact sheets on employee notice requirements and how to calculate FMLA leave, rules for military family leave, and other topics.

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OFCCP’s new sex discrimination regulations include compensation, pregnancy, caregiver, and gender identity provisions

June 15th, 2016  |  Cynthia L. Hackerott  |  Add a Comment

Replacing its outdated sex discrimination guidelines from 1970, the OFCCP announced on June 14, 2016 a final rule on new sex discrimination regulations that the agency says align with current law and address the realities of today’s workplaces. Topics addressed in the final rule—which updates the provisions at 41 CFR Part 60-20 for the first time in more than four and a half decades— include compensation discrimination, harassment, accommodations for pregnant workers, gender identity bias, and family caregiving discrimination. The final rule was published in the Federal Register on June 15, 2016 (81 FR 39108-39169), and is scheduled to take effect on August 15, 2016.

The OFCCP website has a page regarding the final rule that contains frequently asked questions, a fact sheet, a chart comparing the final rule to the 1970 sex discrimination guidelines, and other resources.

“We have made progress as a country in opening career opportunities for women that were, for decades, the province of men. Yet, there is more work that lies ahead to eradicate sex discrimination. This is why it is important that we bring these old guidelines from the ‘Mad Men’ era to the modern era, and align them with the realities of today’s workplaces and legal landscape,” said OFCCP Director Patricia A. Shiu in the June 14, 2016 statement announcing the final rule.

The agency’s announcement of the rule was made in conjunction with the start of the White House Council on Women and Girls first “United State of Women” Summit.

“The rule adopted today will mean that long debunked stereotypes will not keep workers from getting a new job or a promotion,” said DOL Women’s Bureau Director Latifa Lyles. “This is an important reminder that there is no such thing as ‘women’s work’ or ‘men’s work,’ there is only work.”

Outdated guidelines. The guidance in Part 60-20 was first published in the Federal Register on June 9, 1970 (35 FR 8888) and became effective as reissued (43 FR 49258) on October 20, 1978. The new final rule marks the first update to Part 60-20 since it was first published. Since that time, the nature and extent of women’s participation in the labor force and employer policies and practices have changed significantly. In addition, extensive changes in the law regarding sex-based employment discrimination have taken place, the OFCCP points out, noting that Title VII has been amended twice. Indeed, some of the guidelines’ provisions deviate from well-established law, and the agency no longer enforces outdated provisions. Thus, the OFCCP published a Notice of Proposed Rulemaking (NPRM) in the Federal Register on January 30, 2015 (80 FR 5246–5279) designed to clarify contractors’ obligations under current law and remove conflicting regulatory provisions.

The original public comment deadline for the NPRM was March 31, 2015. However, on March 27, 2015, the OFCCP announced an extension of the deadline to April 14, 2015 to allow the public time to comment on the impact of the U.S. Supreme Court’s March 25, 2015 decision in Young v United Parcel Serv (98 EPD ¶45,276). A notice of this extension was published in the Federal Register on April 1, 2014 (80 FR 17373). In Young, the Court held that an individual pregnant worker who seeks to show disparate treatment under Title VII through indirect evidence may do so through application of the McDonnell Douglas framework, but such plaintiffs are not required to show that the employer’s policy rationale was intentionally biased; rather, the employee can satisfy her burden of showing pretext by demonstrating that the policy put a “significant burden” on pregnant employees, and that the employer’s reasoning was not sufficient to justify that burden. According to the OFCCP, it follows “Title VII principles” when enforcing Executive Order (EO) 11246.

The OFCCP received 553 comments on the proposed rule. It submitted the final rule to the Office of Budget and Management (OMB) for review on October 29, 2015. The OMB approved the final rule on June 13, 2016.

Overview. In the final rule, the OFCCP replaces in significant part the guidelines at Part 60-20 with new sex discrimination regulations, intended to align with existing law and policy, that set forth federal contractors’ obligations under EO 11246 in regard to promoting and ensuring equal opportunities for all persons employed or seeking employment with government contractors and subcontractors without regard to sex. This nondiscrimination requirement also applies to contractors and subcontractors performing under federally assisted construction contracts. The preamble to the final rule notes that, in addition to removing outdated provisions in the current guidelines, the final rule also adds, restates, reorganizes, and clarifies other provisions to incorporate legal developments that have arisen since 1970 and to address contemporary problems with implementation.

Under the final rule, the current title of Part 60-20 has been changed from “Sex Discrimination Guidelines” to “Discrimination on the Basis of Sex,” to make clear that the provisions in part 60-20 are regulations implementing EO 11246 with the full force and effect of law.

General provisions (Section 60-20.2). The final rule sets forth the general prohibition of sex discrimination, including discrimination on the bases of pregnancy, childbirth, or related medical conditions. It also describes employment practices that may unlawfully treat men and women disparately and describes employment practices (such as height or weight qualifications) that are unlawful if they have a disparate impact on the basis of sex and are not job-related and consistent with business necessity.

Of note, the final rule incorporates the Obama administration’s current legal interpretations that discrimination based on sex includes discrimination based on gender identity and transgender status. As such, the provisions of the final rule reflect the OFCCP’s view that adverse treatment of employees on the basis of failure to conform to particular gender norms and expectations about their appearance, attire, or behavior is unlawful sex discrimination. Accordingly, the rule requires contractors to allow workers to use bathrooms, changing rooms, showers, and similar facilities consistent with the gender with which the workers identify. On top of that, the preamble to the rule states that an explicit, categorical exclusion of coverage for all care related to gender dysphoria or gender transition is facially discriminatory because such an exclusion singles out services and treatments for individuals on the basis of their gender identity or transgender status.

BFOQ defense (Section 60-20.3). Consolidating in one provision the current references to the BFOQ defense available to employers and updating the language set forth in Title VII, the new Section 60-20.8 replaces the previous section entitled, “Job policies and practices” with “Sex as a bona fide occupational qualification.”

Compensation (Section 60-20.4). For purposes of evaluating compensation differences, the final rule states that the determination of similarly situated employees is case-specific. Relevant factors in determining similarity may include tasks performed, skills, effort, levels of responsibility, working conditions, job difficulty, minimum qualifications, and other objective factors. In some cases, employees are similarly situated where they are comparable on some of these factors, even if they are not similar on others, according to the OFCCP.

In addition, the rule explains that unlawful compensation discrimination can result from job segregation or classification on the basis of gender, not just unequal pay for equal work. It provides that contractors may not grant or deny opportunities for overtime work, training, apprenticeships, better pay, or higher-paying positions or opportunities that may lead to advancement to higher-paying positions because of a worker’s sex.

Notably, the final rule also includes a provision that enables employees to recover lost wages any time a contractor pays compensation that states a contractor violates EO 11246 and these regulations “any time it pays wages, benefits, or other compensation that is the result in whole or in part of the application of any discriminatory compensation decision or other practice.is the result of discrimination, not only when the decision to discriminate is made” (Part 60-20.4(e)).

Pregnancy, childbirth, and related medical conditions (Section 60-20.5). The final rule requires that contractors provide workplace accommodations, such as extra bathroom breaks and light-duty assignments, to an employee who needs such accommodations because of pregnancy, childbirth, or related medical conditions, in certain circumstances where those contractors provide comparable accommodations to other workers, such as those with disabilities or occupational injuries. It also provides a non-exhaustive list of examples of unlawful pregnancy discrimination, including: refusing to hire pregnant applicants; firing an employee or requiring an employee to go on leave because the employee becomes pregnant; limiting a pregnant employee’s job duties based on pregnancy or requiring a doctor’s note in order for a pregnant employee to continue employment; providing employees with health insurance that does not cover hospitalization and other medical costs related to pregnancy, childbirth, or related medical conditions when hospitalization is provided for other medical conditions; and denying an alternative job assignment, modified duties or other accommodations to a pregnant employee when such accommodations are provided or are required to be provided by a contractor’s policy or by other relevant laws to other employees whose abilities or inabilities to work are similar.

Benefits (Section 60-20.6). Under the final rule, contractors must provide equal benefits and equal contributions for male and female employees participating in fringe-benefit plans, such as medical, hospital, accident, life insurance, and retirement benefits. The term “fringe benefits” also includes leave, profit-sharing and bonus plans, and other terms, conditions, and privileges of employment. The rule provides that the greater cost of providing a fringe benefit to members of one sex is not a defense to a contractor’s failure to provide benefits equally to members of both sexes.

Note that the final rule replaces the current Section 60-20.6, entitled, “Affirmative action” with the new section entitled “Other fringe benefits.” The previous section on affirmative action is unnecessary because the requirements related to affirmative action programs are set forth in parts 60-2 and 60-4, the OFCCP explained.

Sex-based stereotypes (Section 60-20.7). The final rule incorporates the Obama administration’s current legal interpretations that discrimination based on sex includes discrimination based on gender identity and transgender status. As such, it reflects the OFCCP’s view that adverse treatment of employees on the basis of failure to conform to particular gender norms and expectations about their appearance, attire, or behavior is unlawful sex discrimination.

The final rule also clarifies that adverse treatment of an employee because of gender-stereotyped assumptions relating to family caretaking responsibilities is discrimination, and that leave for childcare must be available to men on the same terms as it is available to women. For example, contractors may not deny mothers employment opportunities that are available to fathers based on the faulty assumption that mothers’ childcare responsibilities will conflict with their job performance. Along the same lines, contractors may not deny fathers flexible workplace arrangements that are available to mothers based on the faulty assumption that men do not have and do not assume childcare responsibilities.

Harassment (Section 60-20.8). Addressing both quid pro quo and hostile-environment sexual harassment, the final rule prohibits unwelcome sexual advances, requests for sexual favors, offensive remarks about a person’s sex, and other verbal or physical conduct of a sexual nature when such conduct unreasonably interferes with an individual’s work performance, becomes the basis for employment decisions, or creates a hostile working environment. The rule also clarifies that sexual harassment includes: (1) harassment based on gender identity or expression, (2) harassment based on pregnancy, childbirth, or related medical conditions, and (3) sex-based harassment that is not sexual in nature but that is because of sex or where one sex is targeted for the harassment.

Appendix offers best practices. An appendix to the final rule identifies best practices designed to help contractors develop and implement procedures to ensure an environment in which all employees feel safe and welcomed, are treated fairly, and are not harassed because of sex.

Religious exemptions. While there is no formal process for invoking the Religious Freedom Restoration Act (RFRA) as a basis for an exemption from EO 11246, the preamble to the final rule explains that insofar as the application of any requirement under this part would violate RFRA, such application shall not be required. Also, the OFCCP notes that EO 11246 specifically allows religiously affiliated contractors (religious corporations, associations, educational institutions, or societies) to favor individuals of a particular religion when making employment decisions. The agency also notes that it follows Supreme Court precedent recognizing that the First Amendment to the Constitution requires a “ministerial exception” from employment discrimination laws, which prohibits the government from interfering with the ability of a religious organization to make employment decisions about its “ministers,” a category that includes, but is not limited to, clergy.

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