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No general civility code here: No employer liability for supervisor who pushed for sex with his employee’s wife

April 2nd, 2014  |  Joy Waltemath  |  Add a Comment

Those who fear that Title VII is being interpreted by the courts to devolve into the dreaded “general civility code” will be encouraged by an Eleventh Circuit decision last month. It decisively affirmed summary judgment to an employer in a Title VII action brought by an employee who alleged that his supervisor had engaged in ongoing efforts to solicit sex from the employee’s wife. You read that right: The supervisor wanted to have sex with the employee’s wife and sought the employee’s help in convincing her.

Soliciting the employee’s wife. While working in the maintenance department of a school district under the direction of his supervisor, a “friend,” the employee said his supervisor continuously tried to solicit the employee’s wife for sexual activity. Specifically, he claimed that his supervisor (1) offered his wife money in return for sex; (2) offered money to the employee – maybe even a promotion! – if he could convince his wife to have sex with the supervisor; and (3) proposed the idea that the two men have sex with the employee’s wife and other women.  Apparently, the supervisor’s antics did not stop there, as he also asked the employee to persuade waitresses to have sex with him in exchange for money.

We’re friends, bro; I just want you to pimp out your wife. On appeal, the Eleventh Circuit in an unpublished opinion acknowledged that the supervisor’s conduct was “highly offensive and inappropriate” but decided there was no error in granting the employer’s motion for summary judgment. And clearly, there was no evidence suggesting the supervisor’s treatment of the employee was based on the employee’s gender; thus, no reasonable juror could conclude that the supervisor discriminated against the employee because of his gender. From the court’s perspective, the supervisor was attracted to his friend’s wife, and the supervisor was talking to the employee “as a friend.” Not even a general civility code violation among friends, apparently.

Additionally, there was no evidence that the employee suffered from any adverse employment action that had any causal link, either directly or indirectly, to his supervisor’s conduct. Focusing on the men’s personal friendship, the court engaged in no discussion of the coercive impact of a supervisor leaning on an employee daily for sexual favors from his wife. Personally I wonder about the quality of the men’s friendship; after all, the employee pursued the claim all the way to the Eleventh Circuit. In any event, the court affirmed summary judgment for the employer here.

But not so frivolous as to award attorneys’ fees. The Eleventh Circuit had a different view on the issue of attorneys’ fees and costs, ruling that although the employer won on summary judgment, it was not entitled to fees and costs. In a Title VII case, a district court may award attorneys’ fees and costs to a prevailing defendant only when the “plaintiff’s action was frivolous, unreasonable, or without foundation,” the appeals court wrote. So an employer that prevails must surpass a threshold showing that the employee’s is case “markedly weak” or “exceedingly weak” – instead, it must demonstrate that the employee’s case is “so patently devoid of merit as to be frivolous.”

Weak yes; frivolous … well … While perhaps weak, the employee’s claim here surpassed that threshold requirement. For example, the employee could not rely on any binding precedent because a factually similar HWE gender discrimination claim had never been addressed in the Eleventh Circuit. So there was no circuit precedent “squarely foreclosing” the employee’s legal argument. In fact, the court said it was “difficult to say” whether the employee’s claim was frivolous. Plus, the employee had in fact provided evidence in support of his claim. Maybe not enough to defeat summary judgment, but that did not reduce his claim to frivolous, so the appeals court reversed the district court’s decision granting attorneys’ fees.

The case is Richardson v Bay District Schools.

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“If it ain’t broke, don’t fix it:” Take care when modifying existing reasonable accommodations

March 27th, 2014  |  Joy Waltemath  |  Add a Comment

By Joy P. Waltemath, J.D.

As an employer, you may have in place existing disability accommodations that are formal and documented – or informal arrangements, perhaps based on off-the-record discussions between supervisors and employees for which there is no documentation.  Not only is it a good idea for you to audit what kind of formal or informal accommodations your organization has extended, a couple of very recent federal district court decisions suggest that courts are going to scrutinize carefully an employer’s modification of existing accommodations. The question may not be whether the accommodation itself is reasonable, but whether changing it is.

Late start time as accommodation. In Isbell v John Crane, Inc, for over two years, a chemical engineer had – by all accounts successfully – started work at 10:00 a.m. as an accommodation for a psychiatric disorder to allow her morning meds to kick in. She had provided a doctor’s note about her later start time, and when a new supervisor sought a list of employees’ starting times, her working hours were listed as 10 a.m. to 6:30 p.m., but that new supervisor was not informed about the medical reason behind her late start. All lab employees were then informed their work schedule was 8:30 a.m. to 5:00 p.m. The employee requested a renewed accommodation and provided the required medical documentation that she needed a later start time.

In the meantime, however, she was still expected to start work at 8:30 a.m. She had trouble meeting that schedule. Three months after she requested a renewed accommodation, she got a 60-day reprieve allowing her to start work at 9:15, but even that schedule was difficult for her to meet, and for the first time she began accumulating points under her employer’s absence policy. She was also diagnosed with a connective tissue disorder for which she submitted another accommodation request to start at 10 a.m. Her physicians consistently supported her need for a later start time. But the employer told her that the 9:15 a.m. start time would cover the new request and that a 10:00 start time created an “undue hardship.”

Predictably, things went downhill. The employee filed two EEOC charges; her employer requested repeated medical documentation of her disabilities, including an independent medical examination, which indicated that until her symptoms were better controlled, she had “credible psychological justification for starting work somewhat later.” She continued to arrive late to work and accrue attendance points; she received a written warning, final warning, and ultimately was terminated for violating the attendance policy.

Employee already had a “reasonable” accommodation. Both parties focused on “whether a start time of 9:15 a.m. was reasonable,” but this, said the court, missed the point. For over two and a half years the employer had accommodated the employee’s disability by allowing her to begin work at 10:00 a.m. The real question to the court was whether it was reasonable for the employer to withdraw that existing accommodation. The employer provided no evidence that the 10:00 start time was an undue burden and, even if it had, the employer’s obligation under the ADA was to engage in the interactive process with the employee to adjust the accommodation. It could not do so unilaterally to the employee’s detriment.

“Unilateral retraction of pre-existing reasonable accommodation.” Notably, her new supervisor made a decision to impose a uniform schedule without information about the employee’s prior history or disability, even though that information was available to the employer; indeed, it had been for years. This left the court unimpressed with what the employer thought was a reasonable compromise, which the court instead characterized as a “half step backward to a 9:15 a.m. start time.”

Undue burden. Examining the employer’s claim of undue burden more carefully, the court analyzed whether keeping the accommodation created an “undue burden.” The employee had successfully performed her duties for over two years by starting at 10 a.m.; there was no evidence that the employer had been unable to maintain its production schedule or that her schedule had caused any delays. This sudden unilateral change to her schedule, without taking into account her known disability, was an unreasonable failure to continue to accommodate her disability.

Notably, in the preceding case, the court actually granted summary judgment in the employee’s favor on her disability discrimination claims. In a similar case, the employee merely avoided summary judgment on her claims that her employer withdrew its late arrival accommodation for her visual disability.

Late arrival, printed schedule to accommodate visual impairment. White v Golden Corral of Hampton, LLC involved a bakery manager who allegedly asked for – and was granted – an accommodation to arrive to work late because she was visually impaired and had to rely on taxis for transportation. In addition, her manager allegedly agreed to print out her monthly work schedule because she was unable to view images on the computer screen.

Some four years later, something changed, although the parties disputed just what. In any event, from the employer’s perspective, her late arrivals became “frequent and excessive;” from the employee’s perspective, not only had the employer previously not required her to arrive on time for her scheduled shift, but now her lateness had been exacerbated by management discontinuing its practice of printing out her schedule, instead modifying her shift times without telling her.  Coupled with disputes as to the number of times the employee actually was tardy, this was enough for the court to deny the employer’s motion for summary judgment.

Changing existing accommodations can be tricky. From these cases, at least a few suggestions for employers emerge:

  • Know what accommodations your organization is making. Audit what kind of ad hoc arrangements your supervisors may have made, as well as those formalized and documented accommodations that HR has implemented.
  • Don’t let managers unilaterally change accommodation-type arrangements without an HR or legal review. Make sure when you’re reviewing any proposed changes that they don’t actually impair an employee’s ability to perform by removing a reasonable accommodation that is working.
  • If you find, after review, that an accommodation truly needs to be changed, remember the interactive process is your friend.  Your duty as an employer is to engage in that process in good faith, not necessarily to accept an employee’s specifically requested accommodation. But if you haven’t even engaged in the interactive process and instead acted unilaterally, you’ll be at a distinct disadvantage if the matter goes to court.
  • Finally, be especially cautious when a reorganization or personnel changes create new reporting relationships. When a new manager comes in, make sure he or she is apprised of any reasonable accommodations that are in place – sharing this information is permissible under the law.

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Employers face prospect of paying more overtime under Obama directive

March 25th, 2014  |  Lisa Milam-Perez  |  Add a Comment

By Lisa Milam-Perez, J.D.

Earlier this month, President Obama issued an Executive Memorandum directing the Secretary of Labor to amend the Fair Labor Standards Act (FLSA) regulations regarding overtime pay — in particular, the “white-collar” exemption provisions that outline which employees are not entitled to such pay. In the President’s view, these exemptions reach too broadly, and more American workers should be entitled to compensation for the excess time they put in over the standard 40-hour workweek. “Today, only 12 percent of salaried workers fall below the threshold that would guarantee them overtime and minimum wage protections (compared with 18 percent in 2004 and 65 percent in 1975),” notes a White House fact sheet on the initiative. “Many of the remaining 88 percent of salaried workers are ineligible for these protections because they fall within the white collar exemptions.”

FLSA Section 201 requires covered employees to be compensated at a rate of 1.5 times their regular hourly rate for hours worked above 40 in a week. However, “executive,” “administrative,” and “professional” employees are exempt from this requirement, as are “computer professionals,” pursuant to the statute’s enabling regulations (29 C.F.R. Part 541), first issued long ago. These rules identifying which employees are “exempt” and “nonexempt” were most recently updated in 2004, under the Bush administration.

“Because these regulations are outdated, millions of Americans lack the protections of overtime and even the right to the minimum wage,” Obama wrote in his March 13 memo. Thus his directive to the Department of Labor (DOL) to issue revised rules “to modernize and streamline” the overtime regulations currently in effect. The President instructed the agency to propose revisions that are “consistent with the intent of the Act” (the depression-era statute was aimed at both improving workers’ pay and working conditions and expanding employment by making it more expensive for employers to over-work their existing workforce) and that respond to the “changing nature of the workplace” as well. (Both management and labor-side advocates have observed that some of the statute’s old-timey provisions are unworkable today.) Obama also said the DOL must make the rules easier for both employers and employees to understand and apply.

What changes can we expect? The Obama memorandum itself was light on details, and the fact sheet issued by the White House offered only a slightly clearer picture of what changes to the white-collar exemption rules lay ahead. It still left much room to speculate as to what regulatory amendments are in store:

• A likely increase in the minimum salary floor under which employees are deemed non-exempt. Currently, employees must earn at least $455 per week in order to fall within one of the white-collar exemptions from overtime; before the 2004 rule changes, it was a mere $250. The left-leaning Economic Policy Institute noted that the value of the salary threshold has eroded considerably and now falls below the poverty level for a family of four. At its peak in 1970, the minimum salary requirement amounted to $1,071 per week in 2013 dollars, or $55,692 a year. It’s 57.5 percent lower now, at just $23,660 a year.

• Some practitioners speculate too that the minimum salary requirement might be linked to inflation or adjusted annually based on the cost of living index. It’s also been predicted that the DOL may drop the “highly compensated employee” test first adopted in 2004. That “shortcut” test assumes that employees earning at least $100,000 annually are exempt as long as they regularly perform “exempt” duties.

• Another likely fix will be to the “duties” tests. For example, currently under the rules, as long as managerial employees spend at least 50 percent of their time performing exempt duties, they could spend significant portions of their workdays doing “concurrent” non-exempt work — the same work their subordinates perform — while still falling within the executive exemption, as long as they are supervising employees and overseeing operations at the same time. This “concurrent duties” concept has been particularly troubling to employee advocates, especially as courts have come to construe the 50-percent provision as a “rule of thumb” rather than a hard and fast requirement. Plaintiff’s attorneys have challenged the provision aggressively (albeit with only modest success) as it applies to dollar store and other retail managers, who often report working 60-80 hours a week without overtime pay as they run the store while simultaneously stocking its shelves. Under these circumstances, the store manager’s “primary duty” is still managing the store’s operations, so the executive exemption applies.

• Of course, the DOL may think outside the “white-collar rules” box in current form, crafting new hurdles altogether for employers to jump before classifying an employee as overtime-exempt. In 2010, for example, the agency briefly floated the prospect of a new “right to know” rule that would require employers to disclose to their workers whether they were “employees” or “independent contractors,” and explain how that conclusion was reached. Observers surmised at the time that the DOL might also compel employers to expressly disclose to employees their status as exempt or non-exempt, and to provide the basis for that determination. Federal Register issuances in recent months have suggested that the DOL has an information collection request in the works seeking to find out “employees’ experiences with worker misclassification,” inviting speculation about whether the aborted 2010 rule proposal may be resurrected. Such a provision would tie nicely into Obama’s plans for tightening the overtime exemptions so that a larger percentage of the workforce would be entitled to premium pay for excess hours.

• The White House fact sheet expressly referenced New York and California, and the heightened salary thresholds those states impose for their exemptions. These and other states have other exemption requirements that are more stringent than the FLSA as well. The DOL may well look to the exemption provisions in these employee-friendly states when rethinking the federal white-collar rules.

A larger agenda. The President’s overtime directive is part of a broader Obama administration agenda to “give America a raise,” as he stated in urging Congress to raise the federal minimum wage. And while the President is powerless to implement a general minimum wage hike without legislative action, he was able to single-handedly raise the pay floor to $10.10 an hour for private employees of federal government contractors in an executive order issued last month. That’s not small change, given the number of the nation’s employers with U.S. government contracts.

Aside from these initiatives, a number of federal agencies have set their sights on independent contractor misclassification — another practice that keeps American workers’ wages artificially deflated, according to the federal government. (This issue has preoccupied state agencies and legislatures in recent years as well.)

Waiting game. For now, employers must sit tight as the DOL takes up the President’s directive with pen in hand — a process that should take months to play out — and be poised to review and offer public comments once a proposed rule is issued. Notably, when the last white-collar rule changes were proposed in 2004, the DOL received 75,000 comments, and the final rule revision differed materially than the rewrite first proposed. Sifting through a similar deluge and redrafting the rules accordingly — amidst what will surely be a contentious process — will slow the course of final rulemaking considerably. That means employers have a fair amount of breathing room before any final rule takes effect. That time can be used to ensure your exempt classifications currently in place are legally sound and to confer with counsel about your organization’s potential vulnerabilities in light of ongoing, informed speculation as to the DOL’s plans.

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“Childbearing capacity” discrimination

March 20th, 2014  |  Kathy Kapusta  |  Add a Comment

While, as the saying goes, you can’t be “just a little bit pregnant,” a federal district court in Michigan recently stated that adverse employment actions taken on account of “childbearing capacity,” are valid claims under Title VII. Although the court was not willing “to go as far as to conclude that a non-pregnant plaintiff” could bring a Pregnancy Discrimination Act claim if in-vitro fertilization was being used, it refused to dismiss an employee’s allegations that she was targeted for her intent to become pregnant after announcing that she would be undergoing IVF. In the court’s opinion, the employee properly characterized her claim as one for “childbearing capacity” discrimination.

In this case, the employee, a lead dental instructor, told her supervisor that she would be undergoing IVF in an effort to become pregnant. While receiving the treatment, her supervisor allegedly told her she had to work as a “teaching assistant” instead of a lead instructor to accommodate the procedure and allow her to sit and told her to work sitting down “because you are being pumped with so many hormones.” After completing the procedure, the employee took a week off. On the day she returned to work, she suffered a miscarriage.

Too focused on babies. The employee alleged that she was demoted the next day, her job title was officially changed the next week, and her job status changed from full-time to part-time. She claimed that her supervisor told her shortly thereafter that she was “not a good cheerleader in the classroom” and was “more focused on babies.” The supervisor also allegedly asked her if she intended to have additional medical procedures “regarding her desire to bear children.” Not surprisingly, the employee sued, asserting gender discrimination claims under Title VII, Michigan’s Elliot-Larsen Civil Rights Act, and the PDA.

Use of IVF. The court initially observed that the majority of lower courts agree with the Sixth Circuit that pregnancy is a necessary prerequisite to a PDA claim. As to the specific issue of whether the PDA applies to women who are receiving IVF, however, the court pointed out that only the Seventh Circuit has ruled that it does. Unwilling to find that a non-pregnant plaintiff who is using IVF falls under the PDA’s protections, the court agreed that adverse employment actions taken on account of childbearing capacity affect only women and are therefore valid claims under Title VII.

PDA claim. As to her PDA claim, the court noted that she alleged that she was pregnant and suffered a miscarriage; that she was qualified for the lead dental instructor position; and that she was an excellent employee who received good performance reviews and merit increases. Although the employer argued that she was demoted because she had not yet received a required certification, the court found that her allegations were sufficient to make an initial showing that she was qualified for her job.

Moreover, her allegation that she had a miscarriage implied that she was pregnant; thus, she suffered a pregnancy-related condition. Because she alleged that she was demoted the day after her miscarriage, there was a sufficient inference that her demotion was caused by her miscarriage. Thus, she stated a plausible claim under the PDA.

Gender discrimination. The employee also alleged that she was demoted and phased out of a job for which she was qualified because of gender discrimination based on her desire and ability to become pregnant. Here, the court observed that the U.S. Supreme Court, in Int’l Union v Johnson, has held that gender discrimination claims based on childbearing capacity fall under Title VII’s protection. Noting that the employee’s particular method of trying to become pregnant was through IVF, the court pointed out that courts are split as to whether firing an employee who has taken time off to undergo IVF is permissible under Title VII.

Childbearing capacity discrimination. Declining to reach this issue, the court stated that the employee did not claim that was why she was fired. Rather, she contended that she was specifically targeted because of her desire to become pregnant and bear children. Childbearing capacity discrimination, which is gender-based, is exactly the type of discrimination that Title VII was designed to cover in order to combat the view of women as marginal workers, the court stated.

Noting that the reasoning behind Title VII supports the employee’s claim, the court observed that she was a member of a protected class by virtue of being a woman. She also alleged that she was qualified for her job, that she was an excellent employee who received good performance reviews and merit increases, and that other similarly situated employees who were not seeking to become pregnant were treated more favorably.

In addition, she alleged that after she made it known that she was attempting to become pregnant through the use of IVF, and after her miscarriage, her employer became concerned about “future endeavors into child bearing.” Moreover, other similarly-situated employees, who were not seeking to become pregnant and had similar records and positions, were not demoted or terminated. Further, the employee contended that her employer’s reasons for demoting her and terminating her were pretextual. Although the employer disputed the employee’s qualifications for the position, the court pointed out that factual disputes were not before it on a motion to dismiss. Accordingly, the employee was able to advance her claim.

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Blogs identify legal gaps and foster a sense of community

March 13th, 2014  |  Lorene Park  |  Add a Comment

By Lorene D. Park, J.D.

Okay, I admit it, when I first started writing blogs for Employment Law Daily I thought that most blogs are only written for two reasons: marketing and pumping up one’s ego. No doubt marketing actually is one main reason, as evidenced by the proliferation of ghostwriting bloggers who post for firms. And there is a certain ego boost when a blog you have written is well received. But what has truly surprised me is the other value I have seen in both reading and writing legal blogs, including the comment section.

Blogs identify trends and gaps in the law for the unwary. Bloggers hale from all over the U.S. and when a similarity of headlines crops up, it signals that either the issue is just emerging (making it interesting fodder for discussion) or that it is something the legal community is struggling with. For example, there were a slew of blogs on:

  • The EEOC’s questionable litigation tactics and its overstepping during the conciliation process.
  • Ownership of social media accounts given the lack of precedent and legislation on the issue.
  • Whether obesity should be a disability under the ADA.

This list could go on and on. Plus, if you want a big picture of main trends, just take a look at the many “top ten” (or “recap”) blogs for the year. The point is this: Blogs have real substantive value. Good blogs can provide legal summaries on key issues, links to primary sources, and practical advice. In many ways, there is as much value to be gained from reading blogs as there is by attending continuing education, though you won’t get course credit for it.

If you are lucky, someone will disagree. For many years my Dad wrote a column for a local newspaper in a small community. He was always tickled when a column sparked a debate among neighbors and he loved getting responses from those who strongly disagreed because it gave him new ways of looking at an issue. To me, legal blogging and commenting also foster the exchange of ideas. For the blogger, instead of discussing an issue with a coworker who has a reason to not offend you, you are putting your thoughts to a large professional community. If you are lucky, someone will disagree with you.

Blogs foster a sense of community. Let’s assume for a moment that: not everyone enjoys “networking” with total strangers at conferences or professional events; many professionals are too busy to regularly attend such functions; and many do most communicating electronically, perhaps because it saves time, avoids “telephone tag,” or because they are telecommuting from a remote location. From my point of view, blogs enable such individuals to more fully enjoy the exchange of ideas and the sense of society that they might otherwise miss. Even for individuals who do regularly make time for conferences, social sites with their blogs and comments provide a way to glean additional insight on issues of particular interest. For my part, I have found a few blogs and comments intriguing enough to reach out and ask the writer to consider submitting an article for the daily news report published by my employer.

Free advertising, but only if you are good. The question of whether a blog is free advertising turns on who your readers are. For example, I doubt a potential client is going to do an Internet search and choose an attorney based on a blog. It would have to be a blog on the individual’s legal issue, written by an attorney in the same geographic area, and the client would have to be a layperson with enough legal knowledge to understand the substance of the blog. That said, I do believe blogs are free advertising – but only if they are good. Good blogs will be noticed by others in the legal community and it is from them that an attorney might possibly garner a referral. And posting good blogs on a regular basis can help distinguish one professional from the rest.

Blogs are fun. The last thing I will say about blogs is that they are fun both to read and write. Blogs are where attorneys and other professional often go beyond plain old analysis and say what they really think about a particular court decision, agency action, or proposed legislation. That sense of irreverence is just the kind of fun you get at happy hour with coworkers – but who has much time for that?

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