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Employers struggle with employee drug problems, both real and imagined

September 7th, 2013  |  Lorene Park  |  Add a Comment

By Lorene D. Park, J.D.

This past year, many headlines on employee drug use have focused on new state laws on the medicinal use of marijuana. Decisions out this summer, however, reflect a much wider array of concerns that employers should take to heart. These include the overuse of prescription medication, defamation based on false reports of addiction, and more. Wise employers will stay abreast of recent developments, make sure that their drug use policies comply, and train all supervisors and investigators on the importance of even-handed enforcement, maintaining privacy, and ensuring that decisions are grounded in fact and based on business necessity.

Overmedicated. Most cases concerning overmedicated employees seem to involve pain or anxiety medication. For example, in Shirley v Precision Castparts Corp, an employee had long been prescribed Vicodin to manage pain from work-related injuries. He started taking multiple prescriptions from different doctors and, after a near overdose, went on FMLA leave. He twice failed to finish drug treatment programs and was fired under a drug-free workplace policy. Affirming summary judgment for the employer on his FMLA and ADA claims, the Fifth Circuit found that the termination did not violate either law and that he was a “current” drug user, not covered by the ADA’s safe harbor provision.

In another case, an employee became depressed and anxious after his mother died; his doctor prescribed Klonopin (Schummer v Black Bear Distribution, LLC). When the employer learned he was overmedicating himself, it provided FMLA leave and helped him find a physician. Three weeks after he returned, he was observed slurring his words, nodding off, and standing with difficulty. He was fired for violating the employer’s policies and coming to work in an “unfit condition.” Granting summary judgment, the court found the employer had a legitimate reason for firing him and did not violate the FMLA or New Jersey law.

As these cases suggest, the fair, even-handed enforcement of a drug-free workplace policy is generally a legitimate reason for taking an adverse action against an employee, including termination. Indeed, despite all the media hype about the new medical marijuana laws and what they mean for employers, the same holds true in that context as well.

Medical marijuana. Most state medical marijuana laws do not relate directly to workplace drug testing and none require employers to accommodate marijuana use on duty. The ones prohibiting discrimination make exceptions where the level of THC (the active ingredient in marijuana) in the blood is high enough to impair an employee while at work. Significantly, regardless of state law, marijuana use continues to be illegal under federal law, leaving employees who use medical marijuana with little recourse against employers for actions taken based on that use.

For example, in Curry v MillerCoors, Inc, a court dismissed the wrongful discharge claim of an employee who was fired for testing positive for marijuana, even though he had a state license to use medical marijuana, had never used it on the employer’s premises, and was not under the influence at work. A positive test for marijuana, even from medical use, is a legitimate basis for discharge under Colorado law, the court noted. Moreover, the state’s “lawful activities” statute (which prohibits termination based on lawful activity off premises and after hours) did not save the claim because the term “lawful” refers to both state and federal law and the latter prohibits marijuana use. The employee’s disability discrimination claim also failed because there was no allegation that the employer enforced its policy in a disparate manner.

When employers are wrong. While proper enforcement of a drug-free workplace policy can shield an employer from liability, the converse is also true. As illustrated by Williams v FedEx Corp Serv, there are many ways that supervisors can take the wrong steps and, if that happens, an employer may end up paying for defamation, invasion of privacy, or other claims. In the FedEx case, an executive took medical leave for stress after his workload tripled due to reorganization. When his short-term disability was denied, the insurer allegedly informed FedEx that his leave was due to a drug/alcohol related illness and FedEx concluded he had self-reported drug use. It required him to enter treatment and to take 11 drug tests, all of which were negative. The court refused to dismiss his intrusion upon seclusion claim because a reasonable person would find it “highly offensive” to be forced into drug treatment despite the lack of a drug problem.

The executive’s defamation claims also survived against FedEx and the clinic where he had his drug tests. His supervisor allegedly denigrated him, spread false rumors that he tested positive for illegal drugs, and disclosed health information to others. As for the clinic, the executive was twice informed in front of other patients that he had been reported as testing positive in the past. A third time, he was required to do the urine test in the presence of a counselor. This was enough to state a defamation claim. Note that his ADA claim failed, however, because he did not show he had a disability under the Act or was regarded as such. In addition, though the court found it to be a closer question, his emotional distress claim also failed.

School your employees. It should go without saying that employers must school supervisors, investigators, and HR staff on the laws that apply when an employee is suspected of misusing prescription medication or using an illicit substance. Applicable laws vary depending on the circumstances. As far as federal laws, both the FMLA and ADA can apply, particularly if an employee takes leave and/or seeks treatment for an addiction. Note that obligations under the ADA can include making a reasonable accommodation for prescription medication and related side effects. In one case, an employer accommodated the side effects of an employee’s sleeping medication by allowing her one hour of unpaid leave every morning (Murry v General Serv Admin).

There are also Title VII discrimination cases involving the disparate enforcement of drug policies (e.g., Ivie v Exterran Energy Solutions, LP). Other laws that could apply include OSHA (which imposes a general duty to provide a safe work environment); the Drug Free Workplace Act of 1988 (which applies to federal contractors or grantees), and industry-specific regulations (e.g., DOT regulations require drug testing in some instances).

Common law claims are also a significant risk depending on how employers respond to suspected drug use. Anyone involved in an investigation or in decisionmaking should be trained on privacy-related claims such as false light and intrusion upon seclusion claims, as well as defamation, emotional distress, and other claims that can arise in this context. It would not hurt to point out the potential for individual liability. The fear of personally being sued can be a powerful motivator for supervisors and others to take the training to heart.

Policy considerations. When drafting or tailoring your policy to comply with laws applicable in your jurisdiction, consider the following:

  • Focus on promoting a safe, health, and productive environment
  • Follow the bounds of applicable law (use statutory language as necessary) when listing the types of conduct prohibited and the consequences for engaging in it
  • Identify when drug tests may be required (workplace accidents, erratic behavior, other reasonable grounds that are clearly defined in the policy)
  • Consider other standard provisions in drug policies, including standard at-will disclaimers, details on the logistics of a test (where it is done; who pays) and a release that gives the employer consent to receive test results, among other provisions

Decisions should be grounded. In general, make sure the policy is clear and uniformly applied. Require that decisionmakers have a legitimate business reason for taking any adverse action. In one case, for example, a welder who took medication for hand pain survived summary judgment on his ADA claim against a company that withdrew his conditional offer of employment because there was a dispute over whether its drug policy, which precluded narcotic use within eight hours of a shift, was based on business necessity (Huffman v Turner Industries Group, LLC). The court noted that the welder had evidence that he did not experience side effects, as well as statistical evidence that few workplace accidents were actually caused by the medication.

Also insist that supervisors, investigators, and HR reps have a solid basis for any conclusion that an employee has violated a drug policy (e.g., an admission or a positive test result). In light of the FedEx case, it wouldn’t hurt to limit the number of negative results it takes to end the matter (e.g., the court found 11 tests excessive, considering they were all negative). Given the vast potential for liability, every drug-free workplace or substance abuse policy should be reviewed by an attorney before use.

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Employers that ignore or fail to investigate sexual harassment will pay for it

September 5th, 2013  |  Lorene Park  |  Add a Comment

By Lorene D. Park, J.D.

In the past two months, courts have rendered decisions involving truly jaw-dropping sexual harassment claims. In fact, just yesterday I read a case where a TSA employee who reported sexual harassment (including two assaults on airport property) was allegedly coerced into signing a pre-written statement indicating the relationship was consensual (Marugame v Napolitano). Other cases have included supervisors who call female subordinates “work wife,” “slave,” and other inappropriate pet names; who detail their sexual prowess and offer their services; and worse.

As deplorable as some of this conduct is, it is even more troubling when employers fail to respond to complaints, conduct only a minimal investigation, or even retaliate against the person complaining. Interestingly, most, if not all of the employers in these cases have sexual harassment policies in place. The cases thus make it obvious that merely having a policy is not enough — it has to be reasonable and properly enforced, and there must also be an effective internal procedure for grievances that allow employees to bypass supervisors when necessary. Here are some recent examples of how not to respond to a sexual harassment complaint:

Ignoring complaints. A female dispatcher who described her alleged harasser as a “peeping tom” and “a persistent pest” who refused to take “no” for an answer, texted her repeatedly, wore short shorts with no underwear, recited love poems, and showed up to her chemotherapy appointment uninvited, survived summary judgment on her hostile work environment and constructive discharge claims (Hollis v Town of Mount Vernon). Her repeated complaints to both the acting police chief and the chief who was on leave resulted in no relief. The acting chief told her the mayor would not fire the male dispatcher and the only thing she could do was take it to the town council. When she started to stand during that night’s council meeting, the acting chief pulled her down and told her that they’d handle it in the morning. They didn’t. He was eventually fired for a different reason, but by then the employee had already resigned.

Appointing harasser’s BFF to investigate. In Miles v Davita Rx, LLC, Inc, an administrative assistant at a dialysis clinic complained (to the wrong person apparently) about her supervisor’s repeated sexual comments and conduct. Among other things, he called her his “work wife” and his “slave,” rubbed her shoulders as she worked, and positioned himself so she backed into his crotch when she moved boxes. He also made sure to point out to his female staff that he could fire them at any time. Fed up, the employee quit. She also wrote a note to higher-level executives detailing the harassment and they responded by putting the alleged harasser’s “dear friend,” an HR manager, in charge of an investigation. That investigation consisted entirely of an interview with the alleged harasser, who denied everything. The employer’s motion for summary judgment on the employee’s sexual harassment claim was denied.

The slap on the wrist. In another case, a legal secretary who the law firm knew had survived a violent rape in the past was repeatedly sent sexual emails by one of the attorneys for whom she worked, notwithstanding her repeated objections (Elster v Fishman). One was an email, which was jokingly set up to appear to be from a client, inquiring about the size of the attorney’s penis. Another included a picture of a naked woman who he proclaimed was his new trainer. After the employee complained to an office manager, a partner informed her that she would no longer be on the distribution lists. However, the same attorney who sent the prior emails sent another with a picture of a naked woman wearing only a Santa hat, and a message stating “Says she knows you!” The employee complained again and the attorney was made to apologize (insincerely, she believed). Soon, a printed email was given to the secretary that referred to an interlude between the attorney and his wife. On these facts, a California appellate court found the trial court erred in sustaining the defendants’ demurrer to her sexual harassment and intentional infliction of emotional distress claims.

Pleading “he said, she said.” In Arabalo v City of Denver, a corrections officer complained that she had been drugged and raped by two deputies. Her immediate supervisor’s response was to say it was a “he said, she said” situation and should be kept under wraps. Meanwhile, another supervisor often asked the employee what she was wearing, requested she lift her shirt, and suggested she sit on his lap for a “big surprise.” In addition, when the employee complained of sexual harassment by inmates and requested a transfer, she was told that it was her job to endure it. Although she was later fired for what the court found were legitimate reasons (mishandling funds; falsification of documents) and most of her claims failed, her hostile work environment claim against the employer survived a motion to dismiss.

Laughing at the situation. Based on evidence that a manager called an employee a “dumb f*cking c*nt” each day he saw her; displayed images of nude women, repeatedly said women do not belong in the oil field; told the employee not to waste her time applying for a job because she had “tits” and “bros before hoes;” and got angry that she would not have sex with a customer’s employee, a court rejected an employer’s argument that the alleged harassment was not sufficiently severe and pervasive to support a hostile work environment claim (Crooks v National Oilwell Varco, LP). Moreover, the employer could not defend its inadequate response to the employee’s repeated complaints — a regional manager laughed and told her it was a “joke.”

Retaliating against the victim. Another gem of a supervisor (de facto supervisor in this case) told a parks and recreation employee that he “owned” her (Lindquist v Tanner). He also hugged her, kissed her, called her at home, and frequently urinated in her presence. After she complained to the parks commission, not only did the harassment continue, but her hours were reduced and discussions of possible future full-time work ceased. Her job was eliminated but the commission retained two other part-time workers who did not complain. The court denied the employer’s motion for summary judgment on her hostile work environment claim and her retaliation claim.

Best practices

Employers must do a better job of responding to sexual harassment complaints than the employers in the above examples. To begin with, have an effective anti-harassment policy and enforce it. At a minimum, a policy should state:

  • that the company will not tolerate sexual harassment in the workplace; define “sexual harassment” clearly and succinctly; provide examples (e.g., touching, suggestive jokes or comments, flirtatious gifts, obscene gestures, blocking free movement, leering, graphic photos or cartoons, questions about personal life);
  • that managers at all levels are responsible for preventing harassment and must immediately report complaints or conduct by anyone (coworker, supervisor, or nonemployee) that may be harassment, even if it looked welcomed;
  • a procedure outlining multiple ways for employees to report harassment, e.g., a manager, a human resources rep, or a tip line;
  • that all reports will be investigated;
  • that there will be no retaliation for reports of harassment.

Merely having a policy is not enough, though — it must be enforced. Treat all complaints seriously and fully investigate, using an impartial investigator. Also, take intermediate measures during the investigation to protect the employee who complained. At the conclusion of the investigation, take appropriate disciplinary measures if called for. Check in again afterwards to make sure that the measures you took were effective and that any and all harassment has actually stopped.

An effective anti-sexual harassment policy, well enforced, does not just benefit employees; it also gives an employer the chance to defend a sexual harassment suit with the Ellerth/Faragher affirmative defense (for laypersons, this involves avoiding liability by showing the employer exercised reasonable care to eliminate harassment and showing the employee unreasonably failed to take advantage of preventative or corrective opportunities). Even if the Ellerth/Faragher defense turns out to be unavailable, the responsive and corrective measures taken by an employer to end harassment can go a long way to limiting subsequent liability.

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Court can’t disregard fluctuating workweek method in calculating overtime for store managers

September 3rd, 2013  |  Ron Miller  |  1 Comment

Most employees have probably never heard of the fluctuating workweek method (FWW) for calculating overtime pay. However, the concept has been around for nearly 70 years since the Supreme Court first recognized it in Overnight Motor Transp Co v Missel. Now found in Department of Labor regulations at 29 CFR Sec. 778.114. Under Missel, the FWW is the proper method of calculating overtime when an employee is paid a weekly wage and is expected to work fluctuating hours. But sometimes, even the courts get it wrong. That was the case in the district court ruling in Ramson v M. Patel Enterprises, Inc dba Party City, where the court adopted a magistrate judge’s unorthodox methodology for calculating overtime damages and disregarded the FWW method.

Following a jury’s finding that executive managers at certain Party City retail stores were misclassified as exempt from overtime compensation, the district court adopted the magistrate’s methodology for calculating overtime damages. Before the magistrate, the employees had argued for the “EZPawn” method, derived from In re EZPawn LP Fair Labor Standards Act Litig. Generally speaking, this method computes an employee’s “regular rate” of pay by dividing his weekly salary by 40, the number of hours in a standard workweek. An overtime payment of 150 percent of the regular rate for all hours worked over 40 during the workweek is then awarded. The employer, on the other hand, argued for application of the FWW method.

In Ramson, the magistrate divided the employees’ weekly salary by 55, the number of hours he found that their weekly salary was intended to compensate. According to the magistrate the employees had been paid for all hours they were entitled to for the hours zero to 40; for hours over 40 and up to 55, they had been paid their regular rate; and for hours over 55 they had not been paid at all. The magistrate awarded one-half the regular rate for each hour over 40 and up to 55, and for all hours over 55, they received one and one-half times their regular rate.

However, the Fifth Circuit found that there was no support in the record for the magistrate’s conclusion that the parties had an understanding that the employees’ salary was only intended to compensate for a set 55-hour workweek.

Length of workweek. According to the appeals court, the overwhelming evidence showed that the employees’ salary was intended to compensate for all hours worked, and that those hours would fluctuate. Consequently, the magistrate’s calculation — which rejected the FWW method — was based on a misunderstanding of the law and was clearly erroneously. Here, the understood arrangement was not a written agreement that clearly laid out the employees’ terms of employment, observed the appeals court. The magistrate, however, interpreted the parties’ mutual understanding to mean that the employees’ salary compensated specifically for 55 hours per week. Yet, the magistrate’s expressed findings did not support such a view. While there were numerous statements in the record indicating that employees were expected work a minimum of around 50 to 55 hours per week, none of those statements established that the store manager’s salary was intended to compensate for a set 55-hour workweek.

On the other hand, testimony that the magistrate did not consider clearly showed that the managers knew their hours would fluctuate and that their salary would not increase or decrease with those fluctuations. Moreover, the employer’s employment application explicitly stated that stores had extended hours for certain occasions, and applicants were asked: “Can you work flexible schedule where days and number of hours scheduled is different each week.” Further, a review of the weekly data revealed only a handful of times that any of the managers worked a precise 55-hour week, but more often 58 or 59 hours. Thus, the magistrate erred in finding that the mutual understanding was for a workweek specifically only for 55 hours.

Written agreement not required. The magistrate also erred in concluding that because the parties did not have a written agreement Missel did not require the use of the FWW. This assumption was wrong, concluded the Fifth Circuit. Rather, the appeals court observed that there is no authority that requires the agreement to be in writing. Moreover, the job application clearly indicated, in writing, that the employees understood their job included “flexible schedules” and “different hours each week.”

Rather, the appeals court observed that Blackmon v Brookshire Grocery Co was the controlling authority in the Fifth Circuit for resolving this case. Thus, Blackmon and Missel reflect the same instruction: FWW is the proper method of calculating overtime when an employee is paid a weekly wage and is expected to work fluctuating hours. Consequently, the ruling of the district court was reversed and the amount of damages vacated and remanded for recalculation.

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OFCCP releases finalized rules revising VEVRAA and Rehab Act Section 503 regulations to require hiring benchmarks and goals

August 27th, 2013  |  Cynthia L. Hackerott  |  2 Comments

Just days after publicly releasing its newly revised Federal Contract Compliance Manual (dated “July 2013”, but posted on August 23, 2013), the OFCCP released its highly anticipated final rules revising its regulations regarding affirmative action for workers with disabilities and protected veterans. The final rules, released less than one month after they were sent to the Office of Management and Budget (OMB) for approval, revise the OFCCP’s regulations at 41 CFR Parts 60-250 and 60-300 that implement the provisions of the Vietnam Era Veterans’ Readjustment Assistance Act of 1974 (VEVRAA) and the regulations in 41 CFR Parts 60-741 that implement the provisions of Section 503 of the Rehabilitation Act of 1973, as amended (Section 503). According to an OFCCP announcement on August 27, 2013, the rules will be published shortly in the Federal Register and will take effect 180 days following publication. The final rules and other related information are now available on the OFCCP’s website. The VEVRAA rule is at http://www.dol.gov/ofccp/VEVRAARule/ and the Section 503 rule is at http://www.dol.gov/ofccp/503Rule/.

These rules, announced by Vice President Biden during an August 27 address to The American Legion in Houston, Texas, will — for the first time ever — provide metrics which, according to the OFCCP will measure federal contractors’ progress toward achieving equal opportunity for people with disabilities and protected veterans. The agency characterizes these metrics as “management tools that inform decision-making and provide real accountability.” In addition, the OFCCP asserts that the rules will facilitate the success of companies that do business with the federal government, by increasing their access to a large, diverse pool of qualified workers.

The VEVRAA rule requires contractors to establish an annual hiring benchmark, either based on the national percentage of veterans in the workforce (currently 8 percent), or based on the best available data and factors unique to their establishments. The Section 503 rule establishes an aspirational 7 percent utilization goal for the employment of individuals with disabilities.

The OFCCP says the rules are clearly needed because the unemployment for certain veterans and persons with disabilities is disproportionately high. Specifically, the annual unemployment rate for post-September 2001 veterans (i.e. veterans from Iraq and Afghanistan) is higher than the rates for all veterans and for nonveterans. The unemployment rate for working-age people with disabilities in 2012 was 15 percent, compared with a rate of 8 percent for working age individuals without disabilities, despite years of technological advances that have made it possible for many people with disabilities to apply for and successfully perform a broad array of jobs.

VEVRAA rule. The OFCCP notes the following as highlights of the VEVRAA final rule:

  • Rescission of 41 CFR Part 60-250: The final rule rescinds the outdated 41 CFR Part 60-250 in its entirety. However, veterans that were formerly protected only under Part 60-250 will still be protected from discrimination under the revised 41 CFR Part 60-300.
  • Hiring benchmarks. The final rule requires that contractors establish annual hiring benchmarks for protected veterans. Contractors must use one of two methods to establish their benchmarks. Contractors may choose to establish a benchmark equal to the national percentage of veterans in the civilian labor force, which will be published and updated annually by the OFCCP. Alternatively, contractors may establish their own benchmarks using certain data from the Bureau of Labor Statistics (BLS) and Veterans’ Employment and Training Service/Employment and Training Administration (VETS/ETA) that will be also be published by the OFCCP, as well other factors that reflect the contractor’s unique hiring circumstances. The data will be posted in the Benchmark Database.
  • Data collection: The final rule requires that contractors document and update annually several quantitative comparisons for the number of veterans who apply for jobs and the number of veterans they hire. The data must be maintained for three years to be used to spot trends.
  • Invitation to Self-Identify: The final rule requires that contractors invite applicants to self-identify as protected veterans at both the pre-offer and post-offer phases of the application process. The final rule includes sample invitations to self-identify that contractors may use.
  • Incorporation of the EO Clause: The final rule requires that specific language be used when incorporating the equal opportunity clause into a subcontract by reference. The mandated language, though brief, will alert subcontractors to their responsibilities as federal contractors.
  • Job Listings: The final rule clarifies that when listing their job openings, contractors must provide that information in a manner and format permitted by the appropriate state or local job service, so that it can access and use the information to make the job listings available to job seekers.
  • Records Access: The final rule clarifies that contractors must allow the OFCCP to review documents related to a compliance check or focused review, either on-site or off-site, at the OFCCP’s option. In addition, the final rule requires contractors, upon request, to inform the OFCCP of all formats in which it maintains its records and provide them to the OFCCP in whichever of those formats the agency requests.

Section 503 rule. Highlights of the Section 503 rule include:

  • Utilization goal: The final rule establishes a nationwide 7 percent utilization goal for qualified individuals with disabilities (IWDs). Contractors will apply the goal to each of their job groups, or to their entire workforce if the contractor has 100 or fewer employees. Contractors must conduct an annual utilization analysis and assessment of problem areas, and establish specific action-oriented programs to address any identified problems.
  • Data collection: The final rule requires that contractors document and update annually several quantitative comparisons for the number of IWDs who apply for jobs and the number of IWDs they hire. The data must be maintained for three years to be used to spot trends.
  • Invitation to Self-Identify: The final rule requires that contractors invite applicants to self-identify as IWDs at both the pre-offer and post-offer phases of the application process, using language prescribed by the OFCCP. The final rule also requires that contractors invite their employees to self-identify as IWDs every five years, using the prescribed language. This language will be posted on the OFCCP website. Of note, among the materials posted on the OFCCP’s website is a letter, dated August 8, 2013, from the EEOC’s Office of Legal Counsel regarding the invitation to self-identify — http://www.dol.gov/ofccp/regs/compliance/sec503/OLC_letter_to_OFCCP_8-8-2013_508c.pdf
  • Incorporation of the EO Clause: The final rule requires that specific language be used when incorporating the equal opportunity clause into a subcontract by reference. The mandated language, though brief, will alert subcontractors to their responsibilities as federal contractors.
  • Records Access: The final rule clarifies that contractors must allow the OFCCP to review documents related to a compliance check or focused review, either on-site or off-site, at the OFCCP’s option. In addition, the final rule requires contractors, upon request, to inform the OFCCP of all formats in which it maintains its records and provide them to the OFCCP in whichever of those formats the agency requests.
  • ADAAA: The final rule implements changes necessitated by the passage of the ADA Amendments Act (ADAAA) of 2008 by revising the definition of “disability” and certain nondiscrimination provisions of the implementing regulations.

Rulemaking background. The OFCCP published a Notice of Proposed Rulemaking (NPRM) regarding it revisions to the agency’s VEVRAA revisions on April 25, 2011 (76 FR 23358), and the comment period, which was originally scheduled to end on June 22, 2011, was extended to close on July 11, 2011 (76 FR 36482). On July 30, 2013, the OFCCP submitted the final rule for OMB approval. The NPRM on the Section 503 revisions was published in the Federal Register on December 9, 2011 (76 FR 77056), and the comment period, which was originally scheduled to end on February 7, 2012, was extended to close on February 21, 2012 (77 FR 7108). The OFCCP submitted the final rule for OMB review on July 31, 2013.

As of the evening of August 27, 2013, OMB approval of the final rules had not yet been reflected on the OMB’s RegInfo.gov website.

Webinars. The OFCCP will hold webinars on the VEVRAA final rule on August 29, 2013 (http://www.dol.gov/find/vevraa-1) and September 11, 2013 (http://www.dol.gov/find/vevraa-2). OFCCP Webinars on the Section 503 final rule will take place on August 30, 2013 (http://www.dol.gov/find/section503-1) and September 18, 2013 (http://www.dol.gov/find/section503-2). All the webinars will start at 2:00 p.m. Eastern Time.

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Employees behaving badly, employers making matters worse

August 24th, 2013  |  Lisa Milam-Perez  |  1 Comment

Reading employment cases for a living, day in and day out, I’m often struck by the compelling human interest stories they tell. Some of these stories, regrettably, reflect humanity at its most ignoble. They tell tales of employees engaged in reprehensible conduct. Worse still, though, are the accounts of employers acting as accomplices to the crime. Consider the cases below:

“A good cook is hard to find.” While working the morning shift one day, a restaurant waitress was slapped on the buttocks by the cook as she walked past him. She complained to the restaurant owner, who simply gave the cook a verbal warning and left it at that. A month later, the waitress was assaulted once again: the cook approached her, grabbed her breasts and forcefully twisted them, and pushed her up against a wall, causing her to cry out in pain. The waitress immediately went to her supervisor, who relayed the incident to the owner. The owner brought the cook into his office and, with the waitress present, the cook admitted to grabbing and twisting her breasts. The next morning, the waitress filed a formal criminal complaint against the cook, who was arrested at the restaurant and charged with battery. He would eventually plead guilty to the battery charge—but not before an “agent” of the restaurant posted bond to get him out of jail and harangued the waitress to drop the charges.

The restaurant never disciplined her attacker. “Good cooks were hard to find,” the owner explained, stating he had no intentions of discharging his employee. Instead, in the weeks following the arrest, the waitress (who was traumatized and had not yet returned to work) received several calls from her supervisor. Calling on the restaurant owner’s behalf, the supervisor urged the waitress to drop the charges, admonishing her to “think about” the cook and his three children. She also threatened the waitress with discharge if she refused to come back to work. Perhaps the waitress might have done so had the supervisor not refused to adjust her work schedule so that she wouldn’t have to work the same shift as her assailant. Instead, unable to return due to her fear and anxiety at the prospect of working with the cook, the employee was discharged.

A federal district court refused to absolve the restaurant, its owner, or the supervisor of liability for the sexual harassment and battery endured by the waitress at the hands of the cook. The restaurant had essentially authorized the harassment and attack by refusing to discipline him or assign him to a different shift, both after the initial incident and again after the subsequent battery. In fact, in repeatedly asking the employee to drop the criminal charges against her assailant and threatening her with retaliation if she did not comply, the restaurant went considerably further: it “actively attempted to shield [the cook] from the consequences of his actions rather than merely refusing to punish him,” the court observed. The conduct here went far beyond “everyday job stresses,” despite the restaurant’s contention to the contrary. As the court saw it, the employer’s active promotion of the cook’s sexual assault on the waitress and its attempt to assist him in avoiding the consequences of his action were extreme and outrageous.

This guy’s a train wreck. After 10 years at CSX, an employee had worked her way up from a yardmaster job to a management-level trainmaster position. During a phone call with a trainmaster at another train yard (who was using a hands-free speaker phone), the employee overheard a man in the background saying, “So how does [the employee] taste and feel because I heard she’s never had a d*** in her.” Two weeks later, in a meeting with the division supervisor about the inappropriate comment, the other trainmaster reported additional lewd remarks that the offending coworker (also a trainmaster) had made about the employee and her sexual orientation, as well as derogatory comments about another female trainmaster. As a result, the coworker was placed on administrative leave pending an investigation. Several of his colleagues overheard him blaming the employee and threatening to retaliate against her. Sure enough, after he was demoted from his trainmaster position, he exercised his seniority right to transfer to an engineer position — working directly under the employee.

Two CSX officials contacted the employee to inform her that the trainmaster had been demoted, that he had not reacted well to it, and that he was about to be transferred to her territory. The employee noted she was apprehensive about supervising him and frightened by the prospect of doing so. Given his comments alluding to violence and retaliation, and out of an apparent concern for her safety, the officials told her to pack her belongings, leave her office, and not return to work. Then they placed her on paid administrative leave until they could “figure out where else to send” her.

The next morning, an unidentified man pounded on the front door of the employee’s home for an hour, yelling “Come out b****. Don’t be afraid of me. Come out. You cost me my job [sic] and I’m going to get you, come on out.” Immediately after the man left, the employee packed her bags, left town, and reported the incident to CSX officials. The company paid for her to stay in a hotel out of town for eight days. However, it did not investigate the incident or question the suspected trainmaster about his involvement. It did, however, offer the employee a transfer out of state so that she wouldn’t have to supervise him. When she refused, she was instructed to meet with an employment counselor. The counselor in turn referred her to a psychiatrist, where she was diagnosed with adjustment disorder, anxiety, occupational harassment, clinical depression, and increased blood pressure related to her employment. She remained on paid medical leave for six months.

While out on leave, the employee received anonymous, harassing phone calls almost daily from a man who kept calling her names and saying, “I’m not finished with you” and “Hey, b****, I haven’t forgotten what you’ve done. Watch your back. I’m going to get you.” Although she changed her phone number three times, the calls persisted. She reported them to her supervisor and the railroad police, but the caller could not be identified because the calls were made from a private, blocked number.

After she was cleared to return to work, the employee accepted a transfer back to her former position as yardmaster at another location in the state — at a $35,000 annual reduction in salary — so that she would not have to supervise her tormentor. But soon after beginning work at the new location, the employee received yet another threatening phone call. “Hey, b****,” the male caller asked, “Did you hear about [the other trainmaster, who had joined her in reporting the incident]?” Later, she learned that he had been attacked while working on a train on a rail line; he was hit on the head from behind and hospitalized for several days with a severe concussion. The employee reported this phone call to her supervisor and to the railroad police as well.

Shortly thereafter, the employee was having car trouble. Driving an unreliable vehicle made her fear for her safety in light of the threats and attack on her colleague, so she asked for permission to use the CSX taxi on occasion while her car was being repaired. It was hardly an unreasonable plea, since CSX frequently used a taxi service to transport workers, provide transportation for employees with car trouble, or perform work-related errands. Although her request was approved by three supervisors, the company began an investigation into her use of the service, unbeknownst to her. CSX also blamed her for an incident in which a train ended up on the wrong track, even though the train conductor acknowledged his error caused the incident. The day after the track incident, the employee was ordered to another meeting to discuss her illness-related absences. When she explained that she had a doctor’s excuse to miss work, CSX officials informed her that the company did not accept doctor-excused absences. The following day, the employee was questioned extensively again — this time about her taxi usage. She was suspended without pay for improper taxi use and ultimately terminated. As of the date of her discharge, no other CSX employee had been disciplined or dismissed for improperly using the company taxi service.

A jury found the employee was subjected to a hostile work environment and CSX did not adequately investigate or respond to the alleged misconduct. She had told her superiors of her “discomfort, trepidation, and outright fear” at the prospect of having to serve as her harasser’s supervisor after his demotion and transfer to her territory. “The cumulative effect” of the employee’s misconduct, “which CSX compounded by its inaction,” was enough from which a jury could find that the harassment she endured was severe and pervasive. The jury also found CSX had negligently retained the assailant and that the company’s negligence proximately caused the damages alleged. The employee had been forced to resign her managerial position, take a demotion and sharp pay cut, and relocate “simply to avoid further victimization as the supervisor of the employee who had sexually harassed her.”

As a result, the employee was awarded $1.56 million in compensatory damages and an additional $500,000 in punitive damages. Denying the employer’s motion for post-trial relief, the court cited numerous aggravating factors, such as CSX’s reprehensible conduct in promoting and perpetuating a hostile work environment by continuing to employ the assailant—despite its stated zero tolerance harassment policy—and in willingly allowing him to transfer to a position over which the employee would have been required to supervise him. The court also noted the psychological distress she endured and the measures that she had to undertake in order to ameliorate her discriminatory working conditions. In fact, the trainmaster’s comment and its aftermath had created a workplace so hostile that the company told the employee to leave town out of fear for her safety. Ultimately, the employee had to “extricate herself [from that environment] by moving halfway across the State … to avoid her harasser.”

The owner’s son is no prince. An employee was assigned to share an office with the son of the company’s founder. When he began placing letters on her desk expressing his affections, the employee told her supervisor about the unwelcome attention, but she suggested that it would be unwise to show the letters to the owner because it would put her job in jeopardy. Her coworker’s amorous advances continued, with him fantasizing openly about divorcing his wife and starting a relationship with the employee. Although the employee countered that she was happily married—in fact, she was currently undergoing fertility treatments to start a family—her coworker was undeterred. He told her to leave her new husband, offered her a “better life,” suggested that she should have his child instead of her husband’s, demanded that she meet him outside of work to discuss his romantic intentions, and suggested that, once his father retired, it was uncertain “what would happen to her.”

One day, while he stood in the Wal-Mart checkout line and discovered that the employee’s husband was standing nearby, the coworker called the employee, apparently trying to taunt her husband with the prospect of an adulterous liaison between the two. After the employee reported the latest incident, the coworker was ordered to vacate their shared office and apologize. A few weeks later, the employee received a text message from the coworker’s wife with the word “HOMEWRECKER!” The coworker called to apologize but also suggested that “he was not sure her job was safe since she was no longer his friend.” He also pressured her to let him share the office again and told her that if she withdrew her complaint, things would return to normal.

The harassment ceased for a time. Then the coworker called the employee to offer the use of his father’s farm on their property for her horses. She went to the farm to talk to the manager, a man whom she knew, but when she got there, the coworker bound her, dragged her to his bedroom and raped her. He told her that he knew of another woman that could do her job and that “times are tough, so it depends on who needs the job worse.” Finally, he offered to show her the pasture. Instead, the employee went to a rape center, and never returned to work.

The employee’s supervisor, unaware of the attack, claimed that the employee voluntarily quit, as grounds for denying her unemployment claim. What followed was a smear campaign against the employee in an effort to silence her, she alleged, and to defame her in the community and prevent her from getting suitable work. The employer and her attacker misled the community about the rape and “deliberately and maliciously sought to sway public opinion” against her in order to undermine her legal claims against them, she claimed. As a result, her marriage fell apart and she required treatment for post-traumatic stress disorder.

In addition to asserting claims against her attacker, the employee sued the employer. She asserted that it was irresponsible and reckless in failing to terminate the owner’s son and that it fostered a sexually charged atmosphere. She also alleged outrageous conduct based on the smear campaign launched after her sexual assault. However, the employee could not establish that her refusal to submit to her coworker’s unwelcome sexual demands resulted in an adverse employment action. Moreover, the rape by her coworker was not an official action of the company and therefore not an adverse employment action. As such, a federal court in Tennessee dismissed the employee’s quid pro quo sexual harassment claim. But her outrageous conduct claim under state law survived a motion to dismiss, and her retaliation claim proceeded in part.

Could this happen to you? It’s easy to spot the missteps by these employers in hindsight, from our vantage point outside the heat of the conflict. Consider, though, whether any of these scenarios could unfold in your organization. Is there an employee you’ve decided is so valuable that you look the other way when he engages in egregious conduct? Are your managers too timid to make the tough calls when problem employees require discipline? Are your HR folks prone to “compassion fatigue,” perhaps secretly hoping a traumatized employee will simply go away? Is there a well-connected scoundrel in your midst who’s been deemed untouchable?

Your leaders and front-line managers are only human, after all, and responding to these crises can be tough. But at a certain point, a foiled response to misconduct amounts to aiding and abetting. Vigilance in the face of such behavior is critical. Or yours may be the next human interest story I read.

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