By Helena Oroz*
This might be the shortest alert you read all year, but following this simple advice will be the easiest step you take towards Fair Credit Reporting Act (FCRA) compliance all year.
Here’s the scoop:
There is a form notice called “A Summary of Your Rights Under the Fair Credit Reporting Act.” If you are an employer that uses a third party to run background checks on applicants and employees, you should know exactly what this is. (If you do not know what this is, you should probably call me.)
I advise employers to provide this form to applicants and employees up front, with their FCRA Disclosure and Authorization, as well as with any pre-adverse action notice that may go out later. Did you know this form notice is also available in Spanish?
As of this Friday, September 21, 2018, employers must use a new version of this form notice. Employers may choose to continue using the old form in conjunction with a separate page that includes the new language, but why add paper to this process? Just use the new form notice (and/or ensure that your background check company is using the new version).
The Bureau of Consumer Financial Protection (BCFP) issued the new version to (1) add a notice about the consumer’s right to a security freeze and (2) update contact information listed for certain FCRA enforcement agencies.
These changes do not impact in any way how you, as an employer, conduct background checks. You just have to use a new form notice. (I told you this was easy.)
You can find the new version of “A Summary of Your Rights Under the Fair Credit Reporting Act” here:
https://files.consumerfinance.gov/f/documents/bcfp_consumer-rights-summary_2018-09.docx.
Does this mean more (hopefully meaningful) FCRA updates to come from the BCFP?
Stay Tuned.
*Helena Oroz is an associate with the firm’s Employment Group and frequently advises clients on FCRA compliance issues. If you have questions about FCRA or just want to chat about this development, please contact Helena at 216-696-4441 or hot@zrlaw.com.
Showing posts with label Background Checks. Show all posts
Showing posts with label Background Checks. Show all posts
Tuesday, September 18, 2018
Tuesday, June 27, 2017
EMPLOYMENT LAW QUARTERLY | Volume XIX, Issue i
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The new ordinance is structured similarly to Ohio’s statewide anti-discrimination law, but includes protected classes not covered by state (or federal) law. Akron’s ordinance, like Ohio law, prohibits discrimination based on a person’s age, race, color, religion, national origin, ancestry, disability, sex, and military status, but adds protections for creed, marital status, familial status, gender identity or expression, and sexual orientation. Akron’s law follows the trend set by Cincinnati, Cleveland, Columbus, Dayton, Toledo, and Youngstown, among other Ohio cities.
With respect to employment discrimination, Akron’s law applies to employers that regularly employ four or more individuals. Similar to Ohio law, Akron’s law also applies to “any person acting on behalf of an employer, directly or indirectly.” Attorneys representing employees may argue the law provides for individual supervisor liability.
The ordinance also establishes the Akron Civil Rights Commission, whose five members will be appointed by the Mayor and confirmed by the Akron City Council. The Commission will “aim to include a diverse set of members from classes of individuals protected from discrimination” by the new ordinance. Commission members must be residents of the City of Akron.
The Akron Civil Rights Commission will hear and investigate complaints brought by individuals who believe they have been discriminated against. A party must file a complaint with the Akron Civil Rights Commission within one year of the alleged discriminatory practice. The new ordinance does not limit the right to file complaints with other agencies, including the Ohio Civil Rights Commission and the Equal Employment Opportunity Commission. Notably, the Akron Civil Rights Commission is empowered to order some substantial remedies for discrimination: hiring, reinstatement, upgrading or promotion; back pay; compliance reporting; notice posting; damages for injury, humiliation, and embarrassment; costs; attorney fees; and civil penalties to the Akron Civil Rights Commission of up to $1,000.00 for each violation.
*Emilie M. Carver practices in all areas of employment and labor law. If you have questions regarding Akron’s new non‑discrimination ordinance, please contact Emilie (emc@zrlaw.com) at (216) 696-4441.
The case began, as so many do, with an employee’s termination. A field technician for Alternative Entertainment, Inc. (“AEI”) voiced his concerns about AEI’s changes to its compensation structure to coworkers, a manager, AEI’s Chief Financial Officer, and even the company’s president, repeatedly referring to technicians collectively. Two days after the employee spoke with the CFO and emailed the president, the company terminated his employment because the “relationship [was] not working out.”
The employee filed charges with the National Labor Relations Board (“NLRB”). An Administrative Law Judge determined that the company violated the NLRA, and the NLRB adopted that decision and filed an application to enforce the order. And that, in short, is how an employee literally makes a federal case out of discontent with compensation practices.
Specifically at issue in the case was AEI’s “Open Door Policy and Arbitration Program.” AEI’s arbitration program required employees to resolve employment-related disputes exclusively through binding arbitration. The company’s arbitration agreement contained a provision stating that the parties agreed that “a claim may not be arbitrated as a class action…and that a claim may not otherwise be consolidated or joined with the claims of others.” The NLRB concluded that this provision violated the NLRA because it prevented employees from taking any concerted legal action.
In reviewing the NLRB’s decision, the Sixth Circuit considered the compatibility of the Federal Arbitration Act (“FAA”), which governs the enforceability of arbitration agreements, and the NLRA, which protects the right to engage in “concerted activities for the purpose of collective bargaining or other mutual aid or protection,” commonly referred to as “Section 7 rights.” The Court determined that the statutes do not conflict because of the FAA’s savings clause. The FAA’s savings clause provides that arbitration agreements are as enforceable as other contracts, but likewise are not any more enforceable than any other contracts “at law or in equity.” In other words, the Court reasoned that the FAA’s savings clause does not require enforcement of any arbitration agreement with illegal provisions. In this case, the arbitration agreement at issue included provisions that prohibited collective and class action suits – illegal under the NLRA as interfering with employees’ Section 7 rights.
In so holding, the Sixth Circuit agreed with the Seventh and Ninth Circuits’ previous holdings on the issue and completely disagreed with the Fifth Circuit’s previous holdings that arbitration provisions mandating individual arbitration of employment-related claims are enforceable. Now it is up to the U.S. Supreme Court to decide how the saga ends. Before the Sixth Circuit even had issued this decision, the Supreme Court had already granted writs of certiorari this past January in Morris v. Ernst & Young, LLP (9th Circuit, 2016), Lewis v. Epic Systems Corp. (7th Circuit, 2016), and Murphy Oil USA, Inc. v. NLRB (5th Circuit, 2015) and consolidated the three cases. The consolidated cases are currently in the briefing stage, so it remains unclear when the Supreme Court will actually issue a decision to resolve this ongoing circuit split.
In the meantime, if you are an employer with an arbitration program, keep tabs on these developments – and perhaps prepare for a change to your program pending the Supreme Court’s decision. Another take away, beyond the immediate scope of this article? Don’t rush to terminate an employee you find annoying because he or she is complaining about compensation changes or other terms and conditions of employment something, especially on behalf of a group. It’s a good way to start the NLRB ball rolling and end up in federal court.
*Helena Oroz, an OSBA Certified Specialist in Labor and Employment Law, is is a member of the firm’s Labor and Employment Groups and has extensive experience with arbitration agreements. If you have questions regarding your arbitration program, contact Helena at hot@zrlaw.com or (216) 696-4441.
Specifically, certain employers must now submit summary pay and hours worked data for their workforce. Starting with the 2017 report, due March 31, 2018:
Until now, the EEO-1 required all reporting employers to categorize employees by job and demographics. Employers first categorize their employees into ten job categories, which remain the same (Executive/Senior Level Officials and Managers; First/Mid-Level Officials and Managers; Professionals; Technicians; Sales Workers; Administrative Support Workers; Craft Workers; Operatives; Laborers and Helpers; and Service Workers). Next, employers report the number of employees within each job classification by sex and ethnicity or race (White; Black or African American; Native Hawaiian or Pacific Islander; Asian; Native American or Alaska Native; or Two or More Races).
Now, applicable employers also must report summary pay data. The revised EEO-1 contains twelve pay bands into which the employer must categorize employees. Employers should pull employee pay data from Box 1 of employee Forms W-2 to prepare the revised EEO-1 but should not report individual pay or salaries. Instead, employers will mark the number of employees in a pay band that fall within a particular job category and demographic. For example, an employer may report five Native Hawaiian men in pay band 10 ($128,960 - $163,799) in the Executive/Senior Level Officials and Managers job category. See the new EEO-1 here: https://www.eeoc.gov/employers/eeo1survey/2016_new_survey_2.cfm.
In addition, applicable large employers must count and report hours worked for employees. Employers will report the total number of hours worked for all employees in a particular pay band and may count hours based on records required under the Fair Labor Standards Act (“FLSA”). For FLSA non-exempt employees, employers should report based on the hours those employees worked. For FLSA exempt employees, employers may: 1) report 20 hours per week for each part-time employee and 40 hours per week for each full-time employee; or 2) report the actual number of hours worked by each exempt employee. For example, four employees in a particular ethnicity and pay band (e.g., Black/African American in pay band 11) could work the following hours: 2,080; 2,500; 1,660; and 1,040. In that case, the employer would report 7,280 hours worked in the year in the Black/African American and pay band 11 column/row. See this portion of the new EEO-1 here: https://www.eeoc.gov/employers/eeo1survey/2016_new_survey_3.cfm.
Since applicable employers now must submit cumulative information for a given year (e.g., hours worked), the EEOC also changed the reporting deadline. Previously, the EEOC required employers to submit their EEO-1 report by September 30th in a given year. Now, the deadline is March 31st. Therefore, applicable employers must submit the next EEO-1 report, which reflects 2017 data, by March 31, 2018 (and will submit 2018 data by March 31, 2019, etc.).
The EEOC also modified the “workforce snapshot period” – the three-month window during which employers choose one pay period to identify and count employees for EEO-1 reporting purposes. Previously, the “workforce snapshot period” was July 1 to September 30. Under the revised EEO-1 report, that “workforce snapshot period” is from October 1 to December 31. Once the employer identifies the individuals on which it will report, it reports their information, including summary pay and hours worked data, for the calendar year.
While employers have some time to adjust to the new reporting requirements, they should begin developing and identifying processes for gathering the newly required data now.
*Lisa A. Kainec, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of employment and labor law. If you have questions about the EEO-1 or its new reporting requirements, contact Lisa (lak@zrlaw.com) at 216.696.4441.
1. Whistleblower Provisions
Employers should make sure their handbook provisions do not inadvertently discourage employees from reporting potential legal violations to the employer or to government agencies. The Equal Employment Opportunity Commission (“EEOC”) has been targeting any policy that may be interpreted as curbing an employee's right to go to the EEOC—or any other agency—to report violations of the law. Reviewing language throughout a handbook in order to address this issue is encouraged. Further, ensuring that a strong anti-retaliation policy or provision is contained in the handbook will prove to be invaluable.
2. Background Checks
Public employers also should take a close look at their background check policies and procedures to make sure they align with Ohio’s “ban-the-box” law that went into effect in March of 2016. The law prohibits Ohio public employers from asking about criminal convictions in the initial application.
The EEOC also has previously issued an Enforcement Guidance regarding the use of criminal background checks in employment. The EEOC Guidance, which is applicable to both public and private sector employers, should also be taken into consideration when revising background check policies and procedures. The EEOC Guidance states that policies which exclude applicants with any criminal conviction from employment are considered discriminatory. Instead, the EEOC requires employers to determine whether specific criminal conviction exclusions are “job related and consistent with business necessity.” To make such a determination, the EEOC utilizes a three-factor test utilized by the Eighth Circuit Court of Appeals in Green v. Missouri Pacific Railroad Co., 523 F.2d 1290 (8th Cir. 1975) (the "Green factors"). Based upon the Green factors, the EEOC will review whether the employer considered the following in denying employment based upon a criminal conviction:
Therefore, employers are encouraged to review their background check policy and procedure in light of Ohio’s “ban-the-box” law and the EEOC Guidance.
3. Drug Testing Policies
As of September 2016, medical marijuana is legal in Ohio. However, nothing in the new law interferes with an employer’s right to prohibit the use, possession or distribution of marijuana in the workplace. Because marijuana is still listed on Schedule I of the Federal Controlled Substance Act, it is also still illegal under federal law. Therefore, Ohio’s medical marijuana law specifically authorizes employers, through a drug-free workplace policy, to treat medical marijuana’s presence in an employee’s system as a violation of the policy. It is advisable for employers to make it clear in their drug-free workplace policies that detection of the presence of medical marijuana in an employee’s system through a drug test will violate the policy.
4. Weapons Ban Policies
Effective March of 2017, Ohio’s new concealed carry law prohibits both public and private employers from having or enforcing policies that restrict valid concealed carry holders (as well as covered active military members) from transporting or storing their firearms and ammunition in their personal vehicles. While nothing in the new law requires employers to allow concealed carry holders to bring their weapons into employer buildings or employer owned or operated vehicles, it does permit concealed carry holders and covered active military members to store their personal firearms and ammunition in their personal vehicles as long as the vehicle is in a location where it is otherwise permitted to be (e.g. a parking lot).
As a result, weapons policies, vehicle usage policies, and other applicable policies should be reviewed and revised in order to ensure continued compliance with Ohio law in this area.
5. Workplace Accommodations and Light Duty Policies
By now, employers are well aware of their obligation to provide a “reasonable accommodation” to a qualified employee or applicant with a disability under Ohio and Federal law. As such, most employers already have a “disability accommodation” policy. However, an employee or applicant with a disability is not the only area where employers must provide a reasonable accommodation.
Title VII of the Civil Rights Act (“Title VII”) also requires employers to provide reasonable accommodations for an employee’s religious practices. In 2015, the requirement to provide religious accommodations was brought to the forefront when the U.S. Supreme Court found that Abercrombie & Fitch failed to inquire whether a reasonable accommodation to its dress code policy could be provided when it rejected a Muslim applicant who wore a hijab to the job interview. See EEOC v. Abercrombie & Fitch, 135 S.Ct. 2028 (2015).
In the case of Young v. UPS, 135 S.Ct. 1338 (2015), the U.S. Supreme Court also held that employer light duty policies that are limited to only workplace injuries and which cannot be utilized by pregnant employees violate the Pregnancy Discrimination Act and Title VII. The U.S. Supreme Court made it clear that polices must treat “women affected by pregnancy . . . the same for all employment-related purposes . . . as other persons not so affected but similar in their ability or inability to work.” As a result, light duty policies and accommodation policies should address female employees who, due to pregnancy, are limited in their ability to work.
Based upon the U.S. Supreme Court’s duel opinions regarding religious accommodations and accommodating pregnancy-related limitations, employers should take a second look at both their light duty and workplace accommodations policies and procedures. Employers should spell out in their handbooks not only the legal basis for accommodations but also the employer’s intention to comply with them when they are reasonable.
So, there you have it – the top five handbook policies to review for 2017 (thus far). Of course, don’t forget the value of supplying employee and management training once your handbook policies are revised. Managers also should be trained regarding their obligations when confronted with a request for an accommodation or for light duty under the law and under the handbook policy.
*Brad E. Bennett, an OSBA Certified Specialist in Labor and Employment law, is a member of the firm’s Labor and Employment Groups and practices out of the firm’s Columbus, Ohio office. If you have questions regarding your company’s handbook policies, contact Brad at beb@zrlaw.com or (614) 224-4411.
At issue in Camp was whether the stock clerk was qualified for his position, given his inability to lift 60 pounds and the employer’s contention that this was an essential job function. When determining whether a particular job function is essential, courts consider a number of factors: 1) the employer’s judgment; 2) the written job description; 3) the amount of time the employee spends performing the function; 4) the consequences of not requiring the employee to perform the function; 5) the work experience of previous employees who held the position; and 6) the current work experiences of employees in similar jobs.
The court in Camp rejected the employer’s reliance on the stock clerk job description. The employer created the job description more than thirty years after the clerk started working for the company. In addition, the clerk’s immediate supervisor testified that heaving lifting was not an essential job function. The court found that a supervisor’s testimony may rebut claimed essential functions detailed in a job description.
Further, the employer submitted nothing more than the job description to prove two facts: 1) that heavy lifting took up a significant percentage of the clerk’s job; and 2) the clerk’s inability to lift more than 35 pounds caused an actual burden. In contrast, everyone who worked with the clerk testified that heavy lifting was a small and non-important part of the job. The court also concluded that any consequences resulting from the clerk’s disability were de minimis, as the clerk and his co-workers had an arrangement alleviating the clerk from having to lift the heaviest items. Those co-workers also testified that such an arrangement would have minimal effect on store operations. Finally, the court considered that the clerk fulfilled his job duties for years with his disability and the help of co-workers.
The Camp case teaches employers several important lessons. Disability discrimination cases are fact-specific. It is imperative that employers engage in an interactive process with individual employees to determine if any reasonable accommodations exist. In addition, employers should fully evaluate whether a job function is truly essential and should not simply rely on an old written job description. Employers also should ensure that management and supervisors have the same understanding regarding a job’s essential functions.
*David P. Frantz practices in all areas of employment and labor law. If you have questions about this decision, disability discrimination, or reasonable accommodations, please contact David (dpf@zrlaw.com) at 216.696.4441.
Sean Kelly joined Zashin & Rich in 2017. He represents public and private sector employers in all aspects of labor and employment law and employee benefits disputes. Sean has extensive litigation experience before state federal courts and administrative agencies. His representative cases include complex occupational safety and health, workplace intentional tort, employment discrimination, and whistleblower matters. Sean also has experience handling disputes arising under the Employer Retirement Income Security Act of 1974 (ERISA) and state insurance law. Sean has appeared before the Supreme Court of Ohio, and has set Ohio precedent in the area of workers' compensation. In addition to his litigation practice, Sean counsels employers in EEO, OSHA, employee benefits, executive compensation, wages and hours, and other compliance matters. He brings over a decade of experience in highly specialized industry sectors including aviation, maritime, health care, and oil and gas production. His practice includes helping employers properly address inspections by government agencies including OSHA, NIOSH, and the FAA.
Monday, August 21, 2017
Patrick M. Watts presents “Creating Fair Labor Standard Act (FLSA) Compliance Strategies That Work” at the National Business Institute’s seminar on Advanced Employment Law held at the Hilton Garden Inn Akron in Akron, Ohio.
Wednesday–Friday, September 13–15, 2017
Patrick M. Watts and Lisa A. Kainec present “Medical Marijuana and the Heroin Epidemic: Impact on the Workplace” at the Ohio Society for Human Resource Management seminar held at Kalahari Resorts in Sandusky, Ohio.
Monday, October 2, 2017
Jonathan J. Downes presents “Labor and Employment Law Challenges” at the Ohio Association Chiefs of Police New Chiefs’ Workshop held at the Crowne Plaza Columbus North‐Worthington in Columbus, Ohio.
Tuesday, October 24, 2017
Lisa A. Kainec presents “Employment Law Hot Topics and Legislative Update” at the Medina Society for Human Resource Management seminar held at Weymouth Country Club in Medina, Ohio.
- Akron United: The Rubber City Passes New Law to Combat Discrimination
- The Saga Continues: Sixth Circuit Rules Employment-Related Class Action Waivers In Arbitration Agreements Are Unenforceable
- More Data, More Problems? EEO-1 Now Requires Reporting of Summary Pay and Hours Worked Data
- Top Five Handbook Policies for Employers to Review in 2017
- Substance Over Form: Employers Need the Right Evidence to Combat Disability Discrimination Claims
- Z&R SHORTS
Akron United: The Rubber City Passes New Law to Combat Discrimination
On March 20, 2017, the City of Akron joined a growing list of Ohio cities with non-discrimination ordinances when Mayor Dan Horrigan signed Ordinance Number 82-2017 into law. The new law protects Akron residents and visitors against discrimination in employment, housing, and public accommodations, and creates the Akron Civil Rights Commission to hear complaints and enforce the new law. The Mayor and City Council “wish to affirm the dignity and worth of all people and provide certainty to the residents and visitors of Akron that unlawful discrimination will not be tolerated in this City.”The new ordinance is structured similarly to Ohio’s statewide anti-discrimination law, but includes protected classes not covered by state (or federal) law. Akron’s ordinance, like Ohio law, prohibits discrimination based on a person’s age, race, color, religion, national origin, ancestry, disability, sex, and military status, but adds protections for creed, marital status, familial status, gender identity or expression, and sexual orientation. Akron’s law follows the trend set by Cincinnati, Cleveland, Columbus, Dayton, Toledo, and Youngstown, among other Ohio cities.
With respect to employment discrimination, Akron’s law applies to employers that regularly employ four or more individuals. Similar to Ohio law, Akron’s law also applies to “any person acting on behalf of an employer, directly or indirectly.” Attorneys representing employees may argue the law provides for individual supervisor liability.
The ordinance also establishes the Akron Civil Rights Commission, whose five members will be appointed by the Mayor and confirmed by the Akron City Council. The Commission will “aim to include a diverse set of members from classes of individuals protected from discrimination” by the new ordinance. Commission members must be residents of the City of Akron.
The Akron Civil Rights Commission will hear and investigate complaints brought by individuals who believe they have been discriminated against. A party must file a complaint with the Akron Civil Rights Commission within one year of the alleged discriminatory practice. The new ordinance does not limit the right to file complaints with other agencies, including the Ohio Civil Rights Commission and the Equal Employment Opportunity Commission. Notably, the Akron Civil Rights Commission is empowered to order some substantial remedies for discrimination: hiring, reinstatement, upgrading or promotion; back pay; compliance reporting; notice posting; damages for injury, humiliation, and embarrassment; costs; attorney fees; and civil penalties to the Akron Civil Rights Commission of up to $1,000.00 for each violation.
*Emilie M. Carver practices in all areas of employment and labor law. If you have questions regarding Akron’s new non‑discrimination ordinance, please contact Emilie (emc@zrlaw.com) at (216) 696-4441.
The Saga Continues: Sixth Circuit Rules Employment-Related Class Action Waivers In Arbitration Agreements Are Unenforceable
The U.S. Court of Appeals for the Sixth Circuit recently issued a much-anticipated decision that cracked the current class action waiver circuit court split even wider. In NLRB v. Alternative Entertainment, Inc., the Sixth Circuit held that an arbitration provision requiring employees to arbitrate individually all employment-related claims is unenforceable because it violates the National Labor Relations Act’s (“NLRA”) guaranteed right to collective action. 858 F. 3d 393 (6th Cir. 2017).The case began, as so many do, with an employee’s termination. A field technician for Alternative Entertainment, Inc. (“AEI”) voiced his concerns about AEI’s changes to its compensation structure to coworkers, a manager, AEI’s Chief Financial Officer, and even the company’s president, repeatedly referring to technicians collectively. Two days after the employee spoke with the CFO and emailed the president, the company terminated his employment because the “relationship [was] not working out.”
The employee filed charges with the National Labor Relations Board (“NLRB”). An Administrative Law Judge determined that the company violated the NLRA, and the NLRB adopted that decision and filed an application to enforce the order. And that, in short, is how an employee literally makes a federal case out of discontent with compensation practices.
Specifically at issue in the case was AEI’s “Open Door Policy and Arbitration Program.” AEI’s arbitration program required employees to resolve employment-related disputes exclusively through binding arbitration. The company’s arbitration agreement contained a provision stating that the parties agreed that “a claim may not be arbitrated as a class action…and that a claim may not otherwise be consolidated or joined with the claims of others.” The NLRB concluded that this provision violated the NLRA because it prevented employees from taking any concerted legal action.
In reviewing the NLRB’s decision, the Sixth Circuit considered the compatibility of the Federal Arbitration Act (“FAA”), which governs the enforceability of arbitration agreements, and the NLRA, which protects the right to engage in “concerted activities for the purpose of collective bargaining or other mutual aid or protection,” commonly referred to as “Section 7 rights.” The Court determined that the statutes do not conflict because of the FAA’s savings clause. The FAA’s savings clause provides that arbitration agreements are as enforceable as other contracts, but likewise are not any more enforceable than any other contracts “at law or in equity.” In other words, the Court reasoned that the FAA’s savings clause does not require enforcement of any arbitration agreement with illegal provisions. In this case, the arbitration agreement at issue included provisions that prohibited collective and class action suits – illegal under the NLRA as interfering with employees’ Section 7 rights.
In so holding, the Sixth Circuit agreed with the Seventh and Ninth Circuits’ previous holdings on the issue and completely disagreed with the Fifth Circuit’s previous holdings that arbitration provisions mandating individual arbitration of employment-related claims are enforceable. Now it is up to the U.S. Supreme Court to decide how the saga ends. Before the Sixth Circuit even had issued this decision, the Supreme Court had already granted writs of certiorari this past January in Morris v. Ernst & Young, LLP (9th Circuit, 2016), Lewis v. Epic Systems Corp. (7th Circuit, 2016), and Murphy Oil USA, Inc. v. NLRB (5th Circuit, 2015) and consolidated the three cases. The consolidated cases are currently in the briefing stage, so it remains unclear when the Supreme Court will actually issue a decision to resolve this ongoing circuit split.
In the meantime, if you are an employer with an arbitration program, keep tabs on these developments – and perhaps prepare for a change to your program pending the Supreme Court’s decision. Another take away, beyond the immediate scope of this article? Don’t rush to terminate an employee you find annoying because he or she is complaining about compensation changes or other terms and conditions of employment something, especially on behalf of a group. It’s a good way to start the NLRB ball rolling and end up in federal court.
*Helena Oroz, an OSBA Certified Specialist in Labor and Employment Law, is is a member of the firm’s Labor and Employment Groups and has extensive experience with arbitration agreements. If you have questions regarding your arbitration program, contact Helena at hot@zrlaw.com or (216) 696-4441.
More Data, More Problems? EEO-1 Now Requires Reporting of Summary Pay and Hours Worked Data
If you thought the Equal Employment Opportunity Commission ("EEOC") was all up in your business before, 2017 won’t bring you any relief. Beginning with 2017 data, the EEOC has created additional reporting requirements for employers required to submit an Employer Information Report, or EEO-1.Specifically, certain employers must now submit summary pay and hours worked data for their workforce. Starting with the 2017 report, due March 31, 2018:
- Private employers and federal contractors/subcontractors with 100 or more employees will submit summary pay data.
- Federal contractors/subcontractors with 50 to 99 employees will continue to report the same job category and demographic data as required in previous years (no summary pay data).
- Private employers with 99 or fewer employees and federal contractors/subcontractors with 49 or fewer employees are not required to submit an EEO-1 report.
Until now, the EEO-1 required all reporting employers to categorize employees by job and demographics. Employers first categorize their employees into ten job categories, which remain the same (Executive/Senior Level Officials and Managers; First/Mid-Level Officials and Managers; Professionals; Technicians; Sales Workers; Administrative Support Workers; Craft Workers; Operatives; Laborers and Helpers; and Service Workers). Next, employers report the number of employees within each job classification by sex and ethnicity or race (White; Black or African American; Native Hawaiian or Pacific Islander; Asian; Native American or Alaska Native; or Two or More Races).
Now, applicable employers also must report summary pay data. The revised EEO-1 contains twelve pay bands into which the employer must categorize employees. Employers should pull employee pay data from Box 1 of employee Forms W-2 to prepare the revised EEO-1 but should not report individual pay or salaries. Instead, employers will mark the number of employees in a pay band that fall within a particular job category and demographic. For example, an employer may report five Native Hawaiian men in pay band 10 ($128,960 - $163,799) in the Executive/Senior Level Officials and Managers job category. See the new EEO-1 here: https://www.eeoc.gov/employers/eeo1survey/2016_new_survey_2.cfm.
In addition, applicable large employers must count and report hours worked for employees. Employers will report the total number of hours worked for all employees in a particular pay band and may count hours based on records required under the Fair Labor Standards Act (“FLSA”). For FLSA non-exempt employees, employers should report based on the hours those employees worked. For FLSA exempt employees, employers may: 1) report 20 hours per week for each part-time employee and 40 hours per week for each full-time employee; or 2) report the actual number of hours worked by each exempt employee. For example, four employees in a particular ethnicity and pay band (e.g., Black/African American in pay band 11) could work the following hours: 2,080; 2,500; 1,660; and 1,040. In that case, the employer would report 7,280 hours worked in the year in the Black/African American and pay band 11 column/row. See this portion of the new EEO-1 here: https://www.eeoc.gov/employers/eeo1survey/2016_new_survey_3.cfm.
Since applicable employers now must submit cumulative information for a given year (e.g., hours worked), the EEOC also changed the reporting deadline. Previously, the EEOC required employers to submit their EEO-1 report by September 30th in a given year. Now, the deadline is March 31st. Therefore, applicable employers must submit the next EEO-1 report, which reflects 2017 data, by March 31, 2018 (and will submit 2018 data by March 31, 2019, etc.).
The EEOC also modified the “workforce snapshot period” – the three-month window during which employers choose one pay period to identify and count employees for EEO-1 reporting purposes. Previously, the “workforce snapshot period” was July 1 to September 30. Under the revised EEO-1 report, that “workforce snapshot period” is from October 1 to December 31. Once the employer identifies the individuals on which it will report, it reports their information, including summary pay and hours worked data, for the calendar year.
While employers have some time to adjust to the new reporting requirements, they should begin developing and identifying processes for gathering the newly required data now.
*Lisa A. Kainec, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of employment and labor law. If you have questions about the EEO-1 or its new reporting requirements, contact Lisa (lak@zrlaw.com) at 216.696.4441.
Top Five Handbook Policies for Employers to Review in 2017
Federal and state legal developments over the past couple of years have brought changes that impact workplace policies and procedures. While President Trump has indicated that federal employment regulations will be pulled back under his administration, employers should make sure their handbooks are up to date in order to comply with current federal and state laws. Here are five policy provisions to review based upon federal and state developments over the past couple years.1. Whistleblower Provisions
Employers should make sure their handbook provisions do not inadvertently discourage employees from reporting potential legal violations to the employer or to government agencies. The Equal Employment Opportunity Commission (“EEOC”) has been targeting any policy that may be interpreted as curbing an employee's right to go to the EEOC—or any other agency—to report violations of the law. Reviewing language throughout a handbook in order to address this issue is encouraged. Further, ensuring that a strong anti-retaliation policy or provision is contained in the handbook will prove to be invaluable.
2. Background Checks
Public employers also should take a close look at their background check policies and procedures to make sure they align with Ohio’s “ban-the-box” law that went into effect in March of 2016. The law prohibits Ohio public employers from asking about criminal convictions in the initial application.
The EEOC also has previously issued an Enforcement Guidance regarding the use of criminal background checks in employment. The EEOC Guidance, which is applicable to both public and private sector employers, should also be taken into consideration when revising background check policies and procedures. The EEOC Guidance states that policies which exclude applicants with any criminal conviction from employment are considered discriminatory. Instead, the EEOC requires employers to determine whether specific criminal conviction exclusions are “job related and consistent with business necessity.” To make such a determination, the EEOC utilizes a three-factor test utilized by the Eighth Circuit Court of Appeals in Green v. Missouri Pacific Railroad Co., 523 F.2d 1290 (8th Cir. 1975) (the "Green factors"). Based upon the Green factors, the EEOC will review whether the employer considered the following in denying employment based upon a criminal conviction:
- The nature and gravity of the offense or conduct;
- The time that has passed since the offense or conduct and/or completion of the sentence; and
- The nature of the job held or sought.
Therefore, employers are encouraged to review their background check policy and procedure in light of Ohio’s “ban-the-box” law and the EEOC Guidance.
3. Drug Testing Policies
As of September 2016, medical marijuana is legal in Ohio. However, nothing in the new law interferes with an employer’s right to prohibit the use, possession or distribution of marijuana in the workplace. Because marijuana is still listed on Schedule I of the Federal Controlled Substance Act, it is also still illegal under federal law. Therefore, Ohio’s medical marijuana law specifically authorizes employers, through a drug-free workplace policy, to treat medical marijuana’s presence in an employee’s system as a violation of the policy. It is advisable for employers to make it clear in their drug-free workplace policies that detection of the presence of medical marijuana in an employee’s system through a drug test will violate the policy.
4. Weapons Ban Policies
Effective March of 2017, Ohio’s new concealed carry law prohibits both public and private employers from having or enforcing policies that restrict valid concealed carry holders (as well as covered active military members) from transporting or storing their firearms and ammunition in their personal vehicles. While nothing in the new law requires employers to allow concealed carry holders to bring their weapons into employer buildings or employer owned or operated vehicles, it does permit concealed carry holders and covered active military members to store their personal firearms and ammunition in their personal vehicles as long as the vehicle is in a location where it is otherwise permitted to be (e.g. a parking lot).
As a result, weapons policies, vehicle usage policies, and other applicable policies should be reviewed and revised in order to ensure continued compliance with Ohio law in this area.
5. Workplace Accommodations and Light Duty Policies
By now, employers are well aware of their obligation to provide a “reasonable accommodation” to a qualified employee or applicant with a disability under Ohio and Federal law. As such, most employers already have a “disability accommodation” policy. However, an employee or applicant with a disability is not the only area where employers must provide a reasonable accommodation.
Title VII of the Civil Rights Act (“Title VII”) also requires employers to provide reasonable accommodations for an employee’s religious practices. In 2015, the requirement to provide religious accommodations was brought to the forefront when the U.S. Supreme Court found that Abercrombie & Fitch failed to inquire whether a reasonable accommodation to its dress code policy could be provided when it rejected a Muslim applicant who wore a hijab to the job interview. See EEOC v. Abercrombie & Fitch, 135 S.Ct. 2028 (2015).
In the case of Young v. UPS, 135 S.Ct. 1338 (2015), the U.S. Supreme Court also held that employer light duty policies that are limited to only workplace injuries and which cannot be utilized by pregnant employees violate the Pregnancy Discrimination Act and Title VII. The U.S. Supreme Court made it clear that polices must treat “women affected by pregnancy . . . the same for all employment-related purposes . . . as other persons not so affected but similar in their ability or inability to work.” As a result, light duty policies and accommodation policies should address female employees who, due to pregnancy, are limited in their ability to work.
Based upon the U.S. Supreme Court’s duel opinions regarding religious accommodations and accommodating pregnancy-related limitations, employers should take a second look at both their light duty and workplace accommodations policies and procedures. Employers should spell out in their handbooks not only the legal basis for accommodations but also the employer’s intention to comply with them when they are reasonable.
So, there you have it – the top five handbook policies to review for 2017 (thus far). Of course, don’t forget the value of supplying employee and management training once your handbook policies are revised. Managers also should be trained regarding their obligations when confronted with a request for an accommodation or for light duty under the law and under the handbook policy.
*Brad E. Bennett, an OSBA Certified Specialist in Labor and Employment law, is a member of the firm’s Labor and Employment Groups and practices out of the firm’s Columbus, Ohio office. If you have questions regarding your company’s handbook policies, contact Brad at beb@zrlaw.com or (614) 224-4411.
Substance Over Form: Employers Need the Right Evidence to Combat Disability Discrimination Claims
Even though a stock clerk could not fulfill his job’s lifting requirements, a court concluded that he was qualified for the job. In Camp v. Bi-Lo, LLC, 662 Fed. Appx. 357 (6th Cir. 2016), a grocery store discharged a stock clerk when the clerk’s doctor did not clear him to lift 60 pounds, which was a “frequent” requirement of his job. The clerk sued, claiming the store discriminated against him on the basis of his disability in violation of the Americans with Disabilities Act (“ADA”).At issue in Camp was whether the stock clerk was qualified for his position, given his inability to lift 60 pounds and the employer’s contention that this was an essential job function. When determining whether a particular job function is essential, courts consider a number of factors: 1) the employer’s judgment; 2) the written job description; 3) the amount of time the employee spends performing the function; 4) the consequences of not requiring the employee to perform the function; 5) the work experience of previous employees who held the position; and 6) the current work experiences of employees in similar jobs.
The court in Camp rejected the employer’s reliance on the stock clerk job description. The employer created the job description more than thirty years after the clerk started working for the company. In addition, the clerk’s immediate supervisor testified that heaving lifting was not an essential job function. The court found that a supervisor’s testimony may rebut claimed essential functions detailed in a job description.
Further, the employer submitted nothing more than the job description to prove two facts: 1) that heavy lifting took up a significant percentage of the clerk’s job; and 2) the clerk’s inability to lift more than 35 pounds caused an actual burden. In contrast, everyone who worked with the clerk testified that heavy lifting was a small and non-important part of the job. The court also concluded that any consequences resulting from the clerk’s disability were de minimis, as the clerk and his co-workers had an arrangement alleviating the clerk from having to lift the heaviest items. Those co-workers also testified that such an arrangement would have minimal effect on store operations. Finally, the court considered that the clerk fulfilled his job duties for years with his disability and the help of co-workers.
The Camp case teaches employers several important lessons. Disability discrimination cases are fact-specific. It is imperative that employers engage in an interactive process with individual employees to determine if any reasonable accommodations exist. In addition, employers should fully evaluate whether a job function is truly essential and should not simply rely on an old written job description. Employers also should ensure that management and supervisors have the same understanding regarding a job’s essential functions.
*David P. Frantz practices in all areas of employment and labor law. If you have questions about this decision, disability discrimination, or reasonable accommodations, please contact David (dpf@zrlaw.com) at 216.696.4441.
Z&R SHORTS
Please join Z&R in welcoming Sean Kelly to its Employment and Labor Groups.
Sean Kelly joined Zashin & Rich in 2017. He represents public and private sector employers in all aspects of labor and employment law and employee benefits disputes. Sean has extensive litigation experience before state federal courts and administrative agencies. His representative cases include complex occupational safety and health, workplace intentional tort, employment discrimination, and whistleblower matters. Sean also has experience handling disputes arising under the Employer Retirement Income Security Act of 1974 (ERISA) and state insurance law. Sean has appeared before the Supreme Court of Ohio, and has set Ohio precedent in the area of workers' compensation. In addition to his litigation practice, Sean counsels employers in EEO, OSHA, employee benefits, executive compensation, wages and hours, and other compliance matters. He brings over a decade of experience in highly specialized industry sectors including aviation, maritime, health care, and oil and gas production. His practice includes helping employers properly address inspections by government agencies including OSHA, NIOSH, and the FAA.
Upcoming Speaking Engagements
Monday, August 21, 2017
Patrick M. Watts presents “Creating Fair Labor Standard Act (FLSA) Compliance Strategies That Work” at the National Business Institute’s seminar on Advanced Employment Law held at the Hilton Garden Inn Akron in Akron, Ohio.
Wednesday–Friday, September 13–15, 2017
Patrick M. Watts and Lisa A. Kainec present “Medical Marijuana and the Heroin Epidemic: Impact on the Workplace” at the Ohio Society for Human Resource Management seminar held at Kalahari Resorts in Sandusky, Ohio.
Monday, October 2, 2017
Jonathan J. Downes presents “Labor and Employment Law Challenges” at the Ohio Association Chiefs of Police New Chiefs’ Workshop held at the Crowne Plaza Columbus North‐Worthington in Columbus, Ohio.
Tuesday, October 24, 2017
Lisa A. Kainec presents “Employment Law Hot Topics and Legislative Update” at the Medina Society for Human Resource Management seminar held at Weymouth Country Club in Medina, Ohio.
Monday, August 1, 2016
EMPLOYMENT LAW QUARTERLY | Volume XVIII, Issue ii
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Ohio recently became the 25th state to legalize medical marijuana. Effective September 8, 2016, doctors may prescribe medical marijuana to individuals diagnosed with HIV/AIDS, Alzheimer’s, cancer, epilepsy, glaucoma, and other specified qualifying medical conditions or diseases.
Ohio’s legalization of medical marijuana comes with restrictions. Under the law, House Bill 523, the Department of Commerce and State Board of Pharmacy will administer a medical marijuana control program. Collectively, these agencies will regulate retail dispensaries, medical marijuana growers, and doctor registration.
In addition, the law provides a number of specific protections for employers to enable them to maintain safe workplaces and enforce reasonable human resource policies, including:
The law prohibits applicants or employees from bringing a cause of action against an employer based on the employer’s failure to hire, discharge, discipline, discrimination, retaliation, or taking an adverse action against the applicant or employee for reasons related to his or her medical marijuana use. Nonetheless, employee use of medical marijuana likely will raise questions and complicate employment decisions under state and federal disability discrimination laws. For example, an employee’s use of medical marijuana may signal that the employee has a disability, which may require an employer to engage in the interactive process with the employee or to provide some form of reasonable accommodation. In addition, employees suffering or recovering from cancer (or other allowed conditions) who are disciplined for medical marijuana use still could raise a legal claim (e.g., retaliation or disability discrimination).
With the law’s effective date fast approaching, employers should determine how to best manage employee medical marijuana use. Considerations will vary based on the nature of the employer and positions affected. Employers with policies referencing drug use should review and consider amending those policies to include provisions specific to Ohio’s new law in order to expressly address medical marijuana use.
*Brad E. Bennett, an OSBA Certified Specialist in Employment and Labor Law, works in the Columbus office. If you have any questions about Ohio’s legalization of medical marijuana, please contact Brad (beb@zrlaw.com) at 614.224.4441.
Paid family and sick leave is a hotly contested issue, with employee rights advocates pushing for financial security for employees who need such leave and employers voicing concerns over costs and leave abuse. In April 2016, New York became the latest state to enact a law providing eligible employees with paid leave to care for family members and newborn children. The New York law is somewhat unique, as the leave payments are funded through an insurance-style system in which the funds are generated from $1 weekly deductions from employee paychecks. Ostensibly, this approach is aimed at appeasing employer qualms over the expense of having to pay their employees while on family and medical leave.
Under the New York law, employees who have been employed for more than 26 weeks are entitled to partially paid leave under certain circumstances. Such circumstances include providing care for a family member with a serious health condition as defined in the federal Family and Medical Leave Act (“FMLA”), a qualifying exigency relating to a family member’s active duty in the Armed Forces as set forth in the FMLA, or time to care for and bond with a child during the first 12 months after birth, adoption, or foster care placement. Funds generated through the $1 weekly deductions from employee pay will compensate employees on leave with a percentage of their wages. The payment percentages and amount of leave entitlement are set to increase over time. When the law is fully implemented in 2021, eligible employees will receive 12 weeks of leave and receive 67% of their average weekly wage (capped at 67% of the state-wide weekly average for wages).
Ohio does not have a law providing for paid family and medical leave. In April, Democrats in the Ohio House of Representatives sponsored House Bill 511, which, if enacted, would create a state-administered, insurance-based paid family and medical leave program somewhat similar to the New York law. Under the bill, premiums would be withheld from employee wages, and eligible employees would be entitled to leave payments based upon their income level. The bill also prohibits retaliation by employers and provides employees with a private cause of action against employers.
On a local level, the Village of Newburg Heights, Ohio recently made national news when it enacted an ordinance providing employees of the Village with maternity/paternity leave. Under the ordinance, full-time Village employees can receive up to six months of maternity/paternity leave with full pay.
As public attention increases and more legislatures focus on paid family and medical leave, employers may find themselves dealing with laws, regulations, expenses, and litigation beyond those associated with the FMLA. The newer, insurance-style approach takes some of the financial burden off employers, as the benefits are funded through employee payroll deductions. However, employers still will incur costs associated with compliance and administration, leave abuse, workforce management to cover for employees on leave, and potential litigation.
New York employers should take action to comply with the new statute. Ohio employers should recognize that paid family and medical leave is on the horizon.
*Drew C. Piersall, an OSBA Certified Specialist in Employment and Labor Law, practices in all areas of employment and labor law. If you have questions about laws relating to family and medical leave, please contact Drew (dcp@zrlaw.com) at 614.224.4441.
As Zashin & Rich first reported, the Ohio Supreme Court recently expanded the application of Ohio’s Sunshine Laws by broadening its interpretation of the Open Meetings Act. In White v. King, the Ohio Supreme Court held that Ohio Revised Code 121.22 “prohibits any private prearranged discussion of public business by a majority of the members of a public body regardless of whether the discussion occurs face to face, telephonically, by video conference, or electronically by e-mail, text, tweet, or other form of communication.” 2016-Ohio-2770.
Generally, R.C. 121.22 requires that public officials take official action and conduct deliberations upon official business in meetings open to the public. The Act defines meetings to include “any prearranged discussions” by a majority of a public body’s members concerning pubic business. All of a public body’s meetings are considered public meetings and open to the public at all times.
However, R.C. 121.22 contains exceptions to these open meetings requirements. Public bodies may hold executive sessions for specific purposes. Those include, but are not limited to: (1) “the appointment, employment, dismissal, discipline, promotion, demotion... or the investigation of charges or complaints against a public employee;” (2) considering the purchase or sale of public property; (3) conferences with an attorney regarding pending or imminent court action; and (4) “preparing for, conducting, or reviewing negotiations or bargaining sessions with public employees.”
The dispute in White v. King centered on a school board’s actions. After the school board changed its internal communications policy, a newspaper praised the lone board member who opposed the change. In a series of email exchanges, the other board members and school board staff drafted a response to the article. The school board president submitted the response to the newspaper with the consent of the other board members (excluding the member who the article praised), and the school board later ratified its response. The lone board member filed a lawsuit, claiming the school board’s actions violated Ohio’s Sunshine Laws.
The school board asserted two primary arguments in defense: (1) the law does not apply to emails because the Act does not mention electronic communications; and (2) the school board’s discussions did not involve public business because only private deliberations on a pending rule or resolution can violate R.C. 121.22. The Ohio Supreme Court rejected both arguments. Construing the statute liberally, the Court determined that the difference between in-person and email communications “is a distinction without a difference.” The Court emphasized that discussions of public bodies are to be conducted in a public forum. Further, the Court found that the school board’s ratification of its prior action (the response) constituted “public business” under the statute. As such, the email discussion qualified as a discussion of public business by the school board and the school board violated Ohio’s Sunshine Laws.
Given the widespread use of electronic communications among public sector legislators, this decision requires a reassessment of how legislators can and should use email or other means of electronic communications. Absent an amendment by Ohio’s General Assembly, legislators should restrict significantly electronic communications. Further, all public agencies should examine their communications policies and contact counsel with questions.
*Jonathan J. Downes, an OSBA Certified Specialist in Employment and Labor Law and a Best Lawyer in America, has over 30 years of experience advising public sector clients regarding the requirements under Ohio’s Sunshine Laws. He represents cities, townships, counties, school districts, and public officials throughout the State of Ohio. If you have any questions about Ohio’s Sunshine Laws or their application, please contact Jonathan (jjd@zrlaw.com), in the Columbus office, at 614.224.4441.
**George S. Crisci, an OSBA Certified Specialist in Employment and Labor Law and a Best Lawyer in America, likewise has over 30 years of experience in practicing labor and employment law. In addition, George has extensive knowledge of Ohio’s Sunshine Laws. If you have any questions about Ohio’s Sunshine Laws or their application, please contact George (gsc@zrlaw.com), in the Cleveland office, at 216.696.4441.
What Do Background Checks Have To Do With ‘Fair Credit Reporting’?!
By Helena Oroz*
The Fair Credit Reporting Act, or FCRA (15 U.S.C. § 1681 et seq.), is a federal law that governs the collection, assembly, and use of information about people – “consumers” in statutory talk.
FCRA is funny: it doesn’t sound like an employment law, because it’s not; it sounds like an arcane consumer protection law (which it is). It applies to employers, but it’s not written for employers. Its name is confusing because it uses the term “credit reporting” while the law itself is all about “consumer reports,” both of which feed misperceptions about what the law covers.
And those misperceptions abound:
Okay, full disclosure: these are not real quotes. But they do represent real misunderstandings and confusion about employer obligations under FCRA.
Quick and dirty: FCRA history.
FCRA has been around since 1970, but its look has changed over the years. The law was originally enacted for objectively good reasons: to prevent misuse of consumer information, to improve the accuracy of consumer reports, and to promote the efficiency of the nation’s banking and consumer credit systems.
In enacting FCRA, Congress found that consumer reporting agencies, or CRAs – the companies that compile the information into a “consumer report” and sell it – had “assumed a vital role in assembling and evaluating consumer credit and other information on consumers.” 15 U.S.C. §1681(a)(3). As a result, CRAs have been on the government’s hot seat for years, first under the enforcement authority of the Federal Trade Commission (“FTC”) and since 2010 under the joint enforcement authority of the FTC and Consumer Financial Protection Bureau (“CFPB”).
In 1996, things got interesting for employers that used consumer reports for employment purposes. Up to that point, employers had limited responsibilities as users of consumer reports. FCRA’s 1996 amendments upped the ante, adding the employer disclosure, authorization, and pre-adverse action requirements that we all (should) know about these days.
Why employers are on their own when it comes to FCRA compliance.
These days, FCRA – the actual statute – seems deceptively simple. Even using the statutorily-required notices may not be enough. Those notices still may not be technically compliant if, for example, they contain extraneous language, like a release of liability, or too much information.
But – says who? Explanatory regulations? Model forms? The FTC or CFPB? That would be nice, but the first two don’t exist, and the second two are mute. The only existing interpretive guidance consists of stale FTC Informal Staff Opinion Letters that do not have the force of law.
The CFPB has been the primary agency responsible for interpreting FCRA for more than five years, yet it has not issued a single piece of guidance regarding employer FCRA obligations during that time. I actually tried to hit the CFPB up for some information via email, and most recently, on Twitter, to no avail. As for recent FTC activity, if this blog post is any indication, don’t look to government agencies to fill the guidance vacuum anytime soon.
Instead, that vacuum is being filled, slowly but surely, with court decisions from the deluge of recent FCRA class actions across the country. From Whole Foods to Michaels Stores to Amazon, to recently Sprint, even the giants are getting hit for alleged FCRA violations. In Sprint’s case (and many others just like it), a job applicant claims the company’s “Authorization for Background Investigation” violates FCRA because “it contains extraneous information,” including third party authorizations, state specific information, and other statements. Rodriguez v. Sprint/United Mgmt. Co., N.D. Illinois No. 1:15-cv-10641. The plaintiff claims that FCRA’s “unambiguous language” and that old FTC guidance provide support for his claims.
Even if that’s true, think about this: if the CFPB simply issued a model Disclosure and Authorization Form, use of which would constitute compliance with FCRA, this entire conversation would be moot.
Quick and dirty: FCRA requirements.
In the meantime, we have to work with what we have. Knowing even a little about FCRA may help clients or others who don’t. (P.S.: Some special rules, not discussed here, apply to the transportation industry).
1. If an employer uses a third party to obtain virtually any kind of background information, FCRA applies. If an employer requests any information about an applicant (or current employee) from a third party in order to make an employment decision, the employer has requested a “consumer report” and must comply with FCRA’s disclosure, authorization, and adverse action notice requirements. If an employer uses its own employees to vet its applicants, for example, FCRA would not apply.
2. For all intents and purposes, “background check” means the same thing as “consumer report.” Common “consumer reports” that employers use to vet applicants include criminal history reports, education records, employment history, and credit history.
3. An employer must provide a disclosure and obtain authorization before requesting a background check. Before requesting a consumer report, an employer always must do two things: (a) make a clear, conspicuous written disclosure to each applicant/employee that a consumer report may be obtained about them for employment purposes; and (b) obtain each applicant’s/employee’s written authorization to obtain a consumer report.
4. The disclosure and authorization must be FCRA-compliant. Both items may be combined into one document, but the document cannot contain any other information. Currently, this is an area of great controversy. FCRA says only that the disclosure must be made “in a document that consists solely of the disclosure,” although the authorization may appear on the same document. 15 U.S.C. §1681b(b)(2)(A). According to that old FTC guidance, this means that a disclosure and authorization may include only minor additional items and cannot be part of an employment application.
5. Employers taking “adverse action” against an applicant/employee based on information in a consumer report must follow a two-step process. This process is intended to give the person an opportunity to review the information and dispute it with the CRA reporting it if the information is incorrect (which can and does happen). “Adverse action” means any decision that adversely affects a current or prospective employee, including not hiring or firing someone, but also disciplinary action, denial of a promotion, or the like.
First, before taking adverse action, the employer must provide the applicant/employee with a copy of the report at issue and a summary of their FCRA rights (available on the CFPB website). Most employers provide this “pre-adverse action notice” in the form of a letter (not technically required by statute, but makes sense) that includes these required enclosures.
Second, after taking adverse action, the employer must provide the applicant/employee with notice of the adverse action that also includes: contact information for the CRA that provided the report; a statement that the CRA did not make the decision to take the adverse action; notice of the applicant’s/employee’s right to obtain a free copy of the consumer report from the CRA within 60 days; and notice of the applicant’s/employee’s right to dispute the accuracy or completeness of any information in the report. Again, most employers provide this “post-adverse action notice” in the form of a letter.
FCRA is silent on how much time should elapse between these two steps, but that old FTC guidance says five business days might be reasonable, depending on the circumstances.
Employers can take a number of steps in the right direction toward FCRA compliance, even in this murky landscape:
So what does FCRA have to do with employer background checks? Everything!
*Helena Oroz, an OSBA Certified Specialist in Employment and Labor Law, practices in all areas of employment law, including FCRA and state fair credit reporting and background check law compliance. If you have any questions about the FCRA, please contact Helena (hot@zrlaw.com) at 216.696.4441. This article originally was published in the Cleveland Metropolitan Bar Journal.
Please join Z&R in welcoming Brad Meyer to its Employment and Labor Groups.
Brad S. Meyer’s practice focuses on all areas of private and public sector labor and employment law and litigation. Brad has worked with public and private employers on issues of contract interpretation, collective bargaining and discipline issues. Prior to joining Zashin & Rich, Brad represented the State of Ohio and Cuyahoga County for over ten years at both the trial and appellate court level. He also was involved in community outreach efforts throughout Cuyahoga County. As a law student at The Penn State – Dickinson School of Law, Brad focused his studies on labor and employment law. He led the school’s Wagner National Labor and Employment Moot Court team to competition in New York City.
Upcoming Speaking Engagements
Monday, August 15, 2016
George S. Crisci presents “Conducting an Effective Internal Investigation” and “National Labor Relations Board Decisions Affecting Unionized and Non-Unionized Workplaces” at the National Business Institute’s Seminar on Advanced Employment Law at the Hilton Akron Fairlawn in Akron, Ohio.
Thursday, September 22, 2016
Stephen S. Zashin presents “Best Hiring Practices” at the 2016 Summit on Making Ohio Communities Safer to be held at the Word Church in Warrensville Heights, Ohio.
Monday, November 7, 2016
George S. Crisci presents “Other Employment Laws You Need to Know” and “The National Labor Relations Board – Obligations and Compliance” at the National Business Institute’s Seminar on Human Resources from Start to Finish in Cleveland, Ohio.
- Medical Marijuana Soon To Be Allowed in Ohio
- Are Insurance-Style Programs the Future of Paid Family and Sick Leave?
- Public Sector Alert: Sunshine Laws May Now Cover Your Email Communications
- What Do Background Checks Have To Do With ‘Fair Credit Reporting’?!
- Z&R SHORTS
Medical Marijuana Soon To Be Allowed in Ohio
By Brad E. Bennett*Ohio recently became the 25th state to legalize medical marijuana. Effective September 8, 2016, doctors may prescribe medical marijuana to individuals diagnosed with HIV/AIDS, Alzheimer’s, cancer, epilepsy, glaucoma, and other specified qualifying medical conditions or diseases.
Ohio’s legalization of medical marijuana comes with restrictions. Under the law, House Bill 523, the Department of Commerce and State Board of Pharmacy will administer a medical marijuana control program. Collectively, these agencies will regulate retail dispensaries, medical marijuana growers, and doctor registration.
In addition, the law provides a number of specific protections for employers to enable them to maintain safe workplaces and enforce reasonable human resource policies, including:
- Employers do not have to permit or accommodate an employee’s use, possession, or distribution of medical marijuana;
- Employers may refuse to hire or may discharge, discipline, or otherwise take an adverse action against an applicant or employee because of that person’s use, possession, or distribution of medical marijuana;
- Employers may establish and enforce drug testing policies, drug-free workplace policies, or zero-tolerance drug policies;
- Employees discharged for violating formal drug-free programs or policies are considered discharged for just cause under Ohio’s unemployment compensation laws (rendering those employees ineligible for unemployment compensation);
- Employee use of medical marijuana cannot interfere with any federal restrictions on employment (e.g., CDL license regulations); and
- Employers still may defend against workers’ compensation claims on the basis that marijuana use contributed to or resulted in an injury.
The law prohibits applicants or employees from bringing a cause of action against an employer based on the employer’s failure to hire, discharge, discipline, discrimination, retaliation, or taking an adverse action against the applicant or employee for reasons related to his or her medical marijuana use. Nonetheless, employee use of medical marijuana likely will raise questions and complicate employment decisions under state and federal disability discrimination laws. For example, an employee’s use of medical marijuana may signal that the employee has a disability, which may require an employer to engage in the interactive process with the employee or to provide some form of reasonable accommodation. In addition, employees suffering or recovering from cancer (or other allowed conditions) who are disciplined for medical marijuana use still could raise a legal claim (e.g., retaliation or disability discrimination).
With the law’s effective date fast approaching, employers should determine how to best manage employee medical marijuana use. Considerations will vary based on the nature of the employer and positions affected. Employers with policies referencing drug use should review and consider amending those policies to include provisions specific to Ohio’s new law in order to expressly address medical marijuana use.
*Brad E. Bennett, an OSBA Certified Specialist in Employment and Labor Law, works in the Columbus office. If you have any questions about Ohio’s legalization of medical marijuana, please contact Brad (beb@zrlaw.com) at 614.224.4441.
Are Insurance-Style Programs the Future of Paid Family and Sick Leave?
By Drew C. Piersall*Paid family and sick leave is a hotly contested issue, with employee rights advocates pushing for financial security for employees who need such leave and employers voicing concerns over costs and leave abuse. In April 2016, New York became the latest state to enact a law providing eligible employees with paid leave to care for family members and newborn children. The New York law is somewhat unique, as the leave payments are funded through an insurance-style system in which the funds are generated from $1 weekly deductions from employee paychecks. Ostensibly, this approach is aimed at appeasing employer qualms over the expense of having to pay their employees while on family and medical leave.
Under the New York law, employees who have been employed for more than 26 weeks are entitled to partially paid leave under certain circumstances. Such circumstances include providing care for a family member with a serious health condition as defined in the federal Family and Medical Leave Act (“FMLA”), a qualifying exigency relating to a family member’s active duty in the Armed Forces as set forth in the FMLA, or time to care for and bond with a child during the first 12 months after birth, adoption, or foster care placement. Funds generated through the $1 weekly deductions from employee pay will compensate employees on leave with a percentage of their wages. The payment percentages and amount of leave entitlement are set to increase over time. When the law is fully implemented in 2021, eligible employees will receive 12 weeks of leave and receive 67% of their average weekly wage (capped at 67% of the state-wide weekly average for wages).
Ohio does not have a law providing for paid family and medical leave. In April, Democrats in the Ohio House of Representatives sponsored House Bill 511, which, if enacted, would create a state-administered, insurance-based paid family and medical leave program somewhat similar to the New York law. Under the bill, premiums would be withheld from employee wages, and eligible employees would be entitled to leave payments based upon their income level. The bill also prohibits retaliation by employers and provides employees with a private cause of action against employers.
On a local level, the Village of Newburg Heights, Ohio recently made national news when it enacted an ordinance providing employees of the Village with maternity/paternity leave. Under the ordinance, full-time Village employees can receive up to six months of maternity/paternity leave with full pay.
As public attention increases and more legislatures focus on paid family and medical leave, employers may find themselves dealing with laws, regulations, expenses, and litigation beyond those associated with the FMLA. The newer, insurance-style approach takes some of the financial burden off employers, as the benefits are funded through employee payroll deductions. However, employers still will incur costs associated with compliance and administration, leave abuse, workforce management to cover for employees on leave, and potential litigation.
New York employers should take action to comply with the new statute. Ohio employers should recognize that paid family and medical leave is on the horizon.
*Drew C. Piersall, an OSBA Certified Specialist in Employment and Labor Law, practices in all areas of employment and labor law. If you have questions about laws relating to family and medical leave, please contact Drew (dcp@zrlaw.com) at 614.224.4441.
Public Sector Alert: Sunshine Laws May Now Cover Your Email Communications
By Jonathan J. Downes* and George S. Crisci**As Zashin & Rich first reported, the Ohio Supreme Court recently expanded the application of Ohio’s Sunshine Laws by broadening its interpretation of the Open Meetings Act. In White v. King, the Ohio Supreme Court held that Ohio Revised Code 121.22 “prohibits any private prearranged discussion of public business by a majority of the members of a public body regardless of whether the discussion occurs face to face, telephonically, by video conference, or electronically by e-mail, text, tweet, or other form of communication.” 2016-Ohio-2770.
Generally, R.C. 121.22 requires that public officials take official action and conduct deliberations upon official business in meetings open to the public. The Act defines meetings to include “any prearranged discussions” by a majority of a public body’s members concerning pubic business. All of a public body’s meetings are considered public meetings and open to the public at all times.
However, R.C. 121.22 contains exceptions to these open meetings requirements. Public bodies may hold executive sessions for specific purposes. Those include, but are not limited to: (1) “the appointment, employment, dismissal, discipline, promotion, demotion... or the investigation of charges or complaints against a public employee;” (2) considering the purchase or sale of public property; (3) conferences with an attorney regarding pending or imminent court action; and (4) “preparing for, conducting, or reviewing negotiations or bargaining sessions with public employees.”
The dispute in White v. King centered on a school board’s actions. After the school board changed its internal communications policy, a newspaper praised the lone board member who opposed the change. In a series of email exchanges, the other board members and school board staff drafted a response to the article. The school board president submitted the response to the newspaper with the consent of the other board members (excluding the member who the article praised), and the school board later ratified its response. The lone board member filed a lawsuit, claiming the school board’s actions violated Ohio’s Sunshine Laws.
The school board asserted two primary arguments in defense: (1) the law does not apply to emails because the Act does not mention electronic communications; and (2) the school board’s discussions did not involve public business because only private deliberations on a pending rule or resolution can violate R.C. 121.22. The Ohio Supreme Court rejected both arguments. Construing the statute liberally, the Court determined that the difference between in-person and email communications “is a distinction without a difference.” The Court emphasized that discussions of public bodies are to be conducted in a public forum. Further, the Court found that the school board’s ratification of its prior action (the response) constituted “public business” under the statute. As such, the email discussion qualified as a discussion of public business by the school board and the school board violated Ohio’s Sunshine Laws.
Given the widespread use of electronic communications among public sector legislators, this decision requires a reassessment of how legislators can and should use email or other means of electronic communications. Absent an amendment by Ohio’s General Assembly, legislators should restrict significantly electronic communications. Further, all public agencies should examine their communications policies and contact counsel with questions.
*Jonathan J. Downes, an OSBA Certified Specialist in Employment and Labor Law and a Best Lawyer in America, has over 30 years of experience advising public sector clients regarding the requirements under Ohio’s Sunshine Laws. He represents cities, townships, counties, school districts, and public officials throughout the State of Ohio. If you have any questions about Ohio’s Sunshine Laws or their application, please contact Jonathan (jjd@zrlaw.com), in the Columbus office, at 614.224.4441.
**George S. Crisci, an OSBA Certified Specialist in Employment and Labor Law and a Best Lawyer in America, likewise has over 30 years of experience in practicing labor and employment law. In addition, George has extensive knowledge of Ohio’s Sunshine Laws. If you have any questions about Ohio’s Sunshine Laws or their application, please contact George (gsc@zrlaw.com), in the Cleveland office, at 216.696.4441.
What Do Background Checks Have To Do With ‘Fair Credit Reporting’?!
And Other Burning Questions About the Un-employment Law That has Employers on Edge
By Helena Oroz*The Fair Credit Reporting Act, or FCRA (15 U.S.C. § 1681 et seq.), is a federal law that governs the collection, assembly, and use of information about people – “consumers” in statutory talk.
FCRA is funny: it doesn’t sound like an employment law, because it’s not; it sounds like an arcane consumer protection law (which it is). It applies to employers, but it’s not written for employers. Its name is confusing because it uses the term “credit reporting” while the law itself is all about “consumer reports,” both of which feed misperceptions about what the law covers.
And those misperceptions abound:
- “FCRA is about credit reports. We don’t care if our job applicants have bad credit. We just don’t want any criminals around the office. So we’re good, right?”
- “We don’t really deal with ‘consumer’ reports. Just applicant reports. And then sometimes employee reports. So that’s different.”
- “Of course we disclose to applicants that we’re requesting consumer reports. Just read our employment application.”
- “I already know all about this FCRA stuff. Our 10-page packet includes everything we’re supposed to have, plus our release of liability, permission for third parties to disclose information to us, state-specific information...”
- “Adverse action notices? Two of them? Is that a new thing?”
- “This guy’s background check was hilarious. Public intox and indecency?! I can’t believe he applied here. And that’s exactly what I told him when he called asking about the status of his application.”
- “My background check company handles all of my company’s FCRA compliance. I can count on them.”
Okay, full disclosure: these are not real quotes. But they do represent real misunderstandings and confusion about employer obligations under FCRA.
Quick and dirty: FCRA history.
FCRA has been around since 1970, but its look has changed over the years. The law was originally enacted for objectively good reasons: to prevent misuse of consumer information, to improve the accuracy of consumer reports, and to promote the efficiency of the nation’s banking and consumer credit systems.
In enacting FCRA, Congress found that consumer reporting agencies, or CRAs – the companies that compile the information into a “consumer report” and sell it – had “assumed a vital role in assembling and evaluating consumer credit and other information on consumers.” 15 U.S.C. §1681(a)(3). As a result, CRAs have been on the government’s hot seat for years, first under the enforcement authority of the Federal Trade Commission (“FTC”) and since 2010 under the joint enforcement authority of the FTC and Consumer Financial Protection Bureau (“CFPB”).
In 1996, things got interesting for employers that used consumer reports for employment purposes. Up to that point, employers had limited responsibilities as users of consumer reports. FCRA’s 1996 amendments upped the ante, adding the employer disclosure, authorization, and pre-adverse action requirements that we all (should) know about these days.
Why employers are on their own when it comes to FCRA compliance.
These days, FCRA – the actual statute – seems deceptively simple. Even using the statutorily-required notices may not be enough. Those notices still may not be technically compliant if, for example, they contain extraneous language, like a release of liability, or too much information.
But – says who? Explanatory regulations? Model forms? The FTC or CFPB? That would be nice, but the first two don’t exist, and the second two are mute. The only existing interpretive guidance consists of stale FTC Informal Staff Opinion Letters that do not have the force of law.
The CFPB has been the primary agency responsible for interpreting FCRA for more than five years, yet it has not issued a single piece of guidance regarding employer FCRA obligations during that time. I actually tried to hit the CFPB up for some information via email, and most recently, on Twitter, to no avail. As for recent FTC activity, if this blog post is any indication, don’t look to government agencies to fill the guidance vacuum anytime soon.
Instead, that vacuum is being filled, slowly but surely, with court decisions from the deluge of recent FCRA class actions across the country. From Whole Foods to Michaels Stores to Amazon, to recently Sprint, even the giants are getting hit for alleged FCRA violations. In Sprint’s case (and many others just like it), a job applicant claims the company’s “Authorization for Background Investigation” violates FCRA because “it contains extraneous information,” including third party authorizations, state specific information, and other statements. Rodriguez v. Sprint/United Mgmt. Co., N.D. Illinois No. 1:15-cv-10641. The plaintiff claims that FCRA’s “unambiguous language” and that old FTC guidance provide support for his claims.
Even if that’s true, think about this: if the CFPB simply issued a model Disclosure and Authorization Form, use of which would constitute compliance with FCRA, this entire conversation would be moot.
Quick and dirty: FCRA requirements.
In the meantime, we have to work with what we have. Knowing even a little about FCRA may help clients or others who don’t. (P.S.: Some special rules, not discussed here, apply to the transportation industry).
1. If an employer uses a third party to obtain virtually any kind of background information, FCRA applies. If an employer requests any information about an applicant (or current employee) from a third party in order to make an employment decision, the employer has requested a “consumer report” and must comply with FCRA’s disclosure, authorization, and adverse action notice requirements. If an employer uses its own employees to vet its applicants, for example, FCRA would not apply.
2. For all intents and purposes, “background check” means the same thing as “consumer report.” Common “consumer reports” that employers use to vet applicants include criminal history reports, education records, employment history, and credit history.
3. An employer must provide a disclosure and obtain authorization before requesting a background check. Before requesting a consumer report, an employer always must do two things: (a) make a clear, conspicuous written disclosure to each applicant/employee that a consumer report may be obtained about them for employment purposes; and (b) obtain each applicant’s/employee’s written authorization to obtain a consumer report.
4. The disclosure and authorization must be FCRA-compliant. Both items may be combined into one document, but the document cannot contain any other information. Currently, this is an area of great controversy. FCRA says only that the disclosure must be made “in a document that consists solely of the disclosure,” although the authorization may appear on the same document. 15 U.S.C. §1681b(b)(2)(A). According to that old FTC guidance, this means that a disclosure and authorization may include only minor additional items and cannot be part of an employment application.
5. Employers taking “adverse action” against an applicant/employee based on information in a consumer report must follow a two-step process. This process is intended to give the person an opportunity to review the information and dispute it with the CRA reporting it if the information is incorrect (which can and does happen). “Adverse action” means any decision that adversely affects a current or prospective employee, including not hiring or firing someone, but also disciplinary action, denial of a promotion, or the like.
First, before taking adverse action, the employer must provide the applicant/employee with a copy of the report at issue and a summary of their FCRA rights (available on the CFPB website). Most employers provide this “pre-adverse action notice” in the form of a letter (not technically required by statute, but makes sense) that includes these required enclosures.
Second, after taking adverse action, the employer must provide the applicant/employee with notice of the adverse action that also includes: contact information for the CRA that provided the report; a statement that the CRA did not make the decision to take the adverse action; notice of the applicant’s/employee’s right to obtain a free copy of the consumer report from the CRA within 60 days; and notice of the applicant’s/employee’s right to dispute the accuracy or completeness of any information in the report. Again, most employers provide this “post-adverse action notice” in the form of a letter.
FCRA is silent on how much time should elapse between these two steps, but that old FTC guidance says five business days might be reasonable, depending on the circumstances.
Employers can take a number of steps in the right direction toward FCRA compliance, even in this murky landscape:
- Employers who use third parties for background checks should ensure that they are using FCRA-compliant disclosures and authorizations and completing the two-step adverse action process.
- Employers who think they are already FCRA-compliant should review their disclosures, authorizations, and adverse action notices. Including extra information in a disclosure, particularly release language, could jeopardize their compliance efforts. Additionally, employers who use “investigative reports" (reports based on personal interviews concerning a person's character, general reputation, personal characteristics, and lifestyle) have additional obligations under FCRA.
- Employers who operate in more than one state should be aware that a number of states have “mini-FCRAs” with separate disclosure, authorization, and/or adverse action requirements.
- Finally, employers should not rely exclusively on background check providers for FCRA compliance. They may offer 100% compliance, but the employer retains ultimate responsibility for FCRA violations. Chances are the provider’s service contract specifically denies any liability for such violations. Employers should ask questions and ensure they understand what is being done on their behalf.
So what does FCRA have to do with employer background checks? Everything!
*Helena Oroz, an OSBA Certified Specialist in Employment and Labor Law, practices in all areas of employment law, including FCRA and state fair credit reporting and background check law compliance. If you have any questions about the FCRA, please contact Helena (hot@zrlaw.com) at 216.696.4441. This article originally was published in the Cleveland Metropolitan Bar Journal.
Z&R Shorts
Please join Z&R in welcoming Brad Meyer to its Employment and Labor Groups.
Brad S. Meyer’s practice focuses on all areas of private and public sector labor and employment law and litigation. Brad has worked with public and private employers on issues of contract interpretation, collective bargaining and discipline issues. Prior to joining Zashin & Rich, Brad represented the State of Ohio and Cuyahoga County for over ten years at both the trial and appellate court level. He also was involved in community outreach efforts throughout Cuyahoga County. As a law student at The Penn State – Dickinson School of Law, Brad focused his studies on labor and employment law. He led the school’s Wagner National Labor and Employment Moot Court team to competition in New York City.
Upcoming Speaking Engagements
Monday, August 15, 2016
George S. Crisci presents “Conducting an Effective Internal Investigation” and “National Labor Relations Board Decisions Affecting Unionized and Non-Unionized Workplaces” at the National Business Institute’s Seminar on Advanced Employment Law at the Hilton Akron Fairlawn in Akron, Ohio.
Thursday, September 22, 2016
Stephen S. Zashin presents “Best Hiring Practices” at the 2016 Summit on Making Ohio Communities Safer to be held at the Word Church in Warrensville Heights, Ohio.
Monday, November 7, 2016
George S. Crisci presents “Other Employment Laws You Need to Know” and “The National Labor Relations Board – Obligations and Compliance” at the National Business Institute’s Seminar on Human Resources from Start to Finish in Cleveland, Ohio.
Tuesday, October 13, 2015
DOES YOUR COMPANY CONDUCT THIRD-PARTY BACKGROUND CHECKS… AND COMPLY WITH FCRA? The frightful law you may not fear, but you should.
By Helena Oroz*
In honor of the scariest, spookiest month of the year, here are the scariest things we are hearing these days about using background reports and complying with the law that governs use of that information:
Okay, full disclosure: these are not real quotes. But they do represent real misunderstandings and confusion about employer obligations under the Fair Credit Reporting Act (“FCRA”).
If these questions and statements sound reasonable, the FCRA class action bar is looking for your company. Here is a small sampling of large companies that settled FCRA class actions in 2015:
But it doesn’t matter if you are small or large, local or national – you are just their type.
Third-party background check reports are “consumer reports.” In simplest terms, the Fair Credit Reporting Act, or FCRA, is a federal law that governs the collection, assembly, and use of information about consumers. The first thing you need to understand about FCRA is that it applies to employers, but also lots of other entities, so it’s not written for employers. Its name is confusing and so is the term “consumer reports,” both which feed misperceptions about what the law covers.
So know this: if your company requests any information about an applicant (or current employee) from a third party and then uses it to make an employment decision, your company has requested a “consumer report” and must comply with FCRA’s disclosure, authorization, and adverse action notice requirements. Common “consumer reports” that employers use to vet applicants include criminal history reports, driving records, education records, employment history, and yes, credit history.
Employers are on their own when it comes to FCRA compliance. This is the second thing you need to understand about FCRA: it is a hyper-technical statute with little to no guidance to lead you to compliance. Even if you have the right notices in place, they still may not be technically compliant if, for example, they contain extraneous language or too much information.
Explanatory regulations? Model forms? FCRA is no FMLA, people. Don’t look to government agencies to fill that guidance vacuum anytime soon. The Consumer Financial Protection Bureau has been the primary agency responsible for interpreting FCRA for more than five years, yet it has not issued a single piece of useful guidance regarding employer FCRA obligations during that time. As for the Federal Trade Commission, if this blog post is any indication, no one is at the wheel there anymore (if they ever were).
Instead, that vacuum is being filled, slowly but surely, with court decisions and an absolute deluge of recent FCRA class actions across the county. According to a recent report from WebRecon, FCRA lawsuits increased 83% in August 2015 from the same period in 2014. From Whole Foods to Michaels Stores to Amazon, even the giants are getting hit for FCRA violations.
What should employers do? Don’t let FCRA scare the living daylights out of you. First, review your hiring practices to ensure that your company is at least doing the following:
(1) making a clear, conspicuous written disclosure to each applicant that consumer reports may be obtained about them for employment purposes;
(2) obtaining each applicant’s written authorization to obtain consumer reports;
(3) when your company decides not to hire an applicant based on information in a consumer report, providing the applicant a copy of the report at issue and a summary of their FCRA rights before taking the action (commonly referred to as pre-adverse action notice); and,
(4) after taking the action, providing the applicant with notice of the adverse action, contact information for the agency that provided the report, and other information (commonly referred to as post-adverse action notice).
Second, if you think your company is FCRA-compliant because it does complete each of the above steps, review your disclosure, authorization, and adverse action notices. Extra information or confusing language in those documents could jeopardize your company’s compliance efforts. Additionally, if your company uses “investigative reports" – reports based on personal interviews concerning a person's character, general reputation, personal characteristics, and lifestyle – your company has additional obligations under FCRA.
Third, if your company operates in more than one state, be aware that a number of states (a number which is growing) have their own “mini-FCRAs” with separate disclosure, authorization, and/or adverse action requirements. Many states also severely restrict use of credit information and/or criminal background information for employment purposes.
Finally, DO NOT rely on your background check provider for FCRA compliance. Ask questions and make sure you know exactly what your background check company is doing on your behalf. Do not forget that FCRA compliance is ultimately your company’s responsibility, not your provider’s.
*Helena Oroz practices in all areas of employment law compliance and often assists Z&R’s clients with FCRA and state fair credit reporting and background check laws. For more information or assistance with your company’s FCRA compliance, please contact Helena | hot@zrlaw.com | 216.696.4441
In honor of the scariest, spookiest month of the year, here are the scariest things we are hearing these days about using background reports and complying with the law that governs use of that information:
- “I think FCRA is that law about credit reports. But we don’t check credit for our job applicants. So we’re good, right?”
- “Do we disclose to applicants that we’re requesting consumer reports? We inform them of a lot of stuff. I think it’s in our employment application somewhere.”
- “Adverse action letters? Two of them? Is that a new thing?
- “My background check company handles all those forms. So we’re good, right?”
- “I’m pretty sure we’re doing most of that stuff right some of the time. But don’t quote me on that.”
Okay, full disclosure: these are not real quotes. But they do represent real misunderstandings and confusion about employer obligations under the Fair Credit Reporting Act (“FCRA”).
If these questions and statements sound reasonable, the FCRA class action bar is looking for your company. Here is a small sampling of large companies that settled FCRA class actions in 2015:
- Fernandez v. Home Depot – $3 million
- Brown v. Delhaize America (owns Food Lion grocery stores) – $2.99 million
- Marcum v. DolgenCorp (owns Dollar General stores) – $4.08 million
But it doesn’t matter if you are small or large, local or national – you are just their type.
Third-party background check reports are “consumer reports.” In simplest terms, the Fair Credit Reporting Act, or FCRA, is a federal law that governs the collection, assembly, and use of information about consumers. The first thing you need to understand about FCRA is that it applies to employers, but also lots of other entities, so it’s not written for employers. Its name is confusing and so is the term “consumer reports,” both which feed misperceptions about what the law covers.
So know this: if your company requests any information about an applicant (or current employee) from a third party and then uses it to make an employment decision, your company has requested a “consumer report” and must comply with FCRA’s disclosure, authorization, and adverse action notice requirements. Common “consumer reports” that employers use to vet applicants include criminal history reports, driving records, education records, employment history, and yes, credit history.
Employers are on their own when it comes to FCRA compliance. This is the second thing you need to understand about FCRA: it is a hyper-technical statute with little to no guidance to lead you to compliance. Even if you have the right notices in place, they still may not be technically compliant if, for example, they contain extraneous language or too much information.
Explanatory regulations? Model forms? FCRA is no FMLA, people. Don’t look to government agencies to fill that guidance vacuum anytime soon. The Consumer Financial Protection Bureau has been the primary agency responsible for interpreting FCRA for more than five years, yet it has not issued a single piece of useful guidance regarding employer FCRA obligations during that time. As for the Federal Trade Commission, if this blog post is any indication, no one is at the wheel there anymore (if they ever were).
Instead, that vacuum is being filled, slowly but surely, with court decisions and an absolute deluge of recent FCRA class actions across the county. According to a recent report from WebRecon, FCRA lawsuits increased 83% in August 2015 from the same period in 2014. From Whole Foods to Michaels Stores to Amazon, even the giants are getting hit for FCRA violations.
What should employers do? Don’t let FCRA scare the living daylights out of you. First, review your hiring practices to ensure that your company is at least doing the following:
(1) making a clear, conspicuous written disclosure to each applicant that consumer reports may be obtained about them for employment purposes;
(2) obtaining each applicant’s written authorization to obtain consumer reports;
(3) when your company decides not to hire an applicant based on information in a consumer report, providing the applicant a copy of the report at issue and a summary of their FCRA rights before taking the action (commonly referred to as pre-adverse action notice); and,
(4) after taking the action, providing the applicant with notice of the adverse action, contact information for the agency that provided the report, and other information (commonly referred to as post-adverse action notice).
Second, if you think your company is FCRA-compliant because it does complete each of the above steps, review your disclosure, authorization, and adverse action notices. Extra information or confusing language in those documents could jeopardize your company’s compliance efforts. Additionally, if your company uses “investigative reports" – reports based on personal interviews concerning a person's character, general reputation, personal characteristics, and lifestyle – your company has additional obligations under FCRA.
Third, if your company operates in more than one state, be aware that a number of states (a number which is growing) have their own “mini-FCRAs” with separate disclosure, authorization, and/or adverse action requirements. Many states also severely restrict use of credit information and/or criminal background information for employment purposes.
Finally, DO NOT rely on your background check provider for FCRA compliance. Ask questions and make sure you know exactly what your background check company is doing on your behalf. Do not forget that FCRA compliance is ultimately your company’s responsibility, not your provider’s.
*Helena Oroz practices in all areas of employment law compliance and often assists Z&R’s clients with FCRA and state fair credit reporting and background check laws. For more information or assistance with your company’s FCRA compliance, please contact Helena | hot@zrlaw.com | 216.696.4441
Tuesday, July 14, 2015
EMPLOYMENT LAW QUARTERLY | Volume XVII, Issue ii
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A Federal Court recently affirmed an employer’s decision to discharge a janitor who claimed the employer discriminated against him on the basis of his religious belief. Bolden v. Caravan Facilities Mgmt., LLC, No. 1:14-CV-26-RLM, 2015 U.S. LEXIS 73619 (N.D. Ind. June 8, 2015). The employer, pursuant to a neutral, rotating schedule, assigned the plaintiff-employee janitor to work on six Sundays over a ten-week span. The employer had negotiated the schedule as part of the collective bargaining agreement (“CBA”) it entered into with the employee’s union. However, the employee, an ordained Baptist minister, did not work any of the scheduled shifts. He called off, did not appear, or traded shifts with another employee in order to observe the Sabbath. After the employer terminated his employment based on unsatisfactory performance, the employee sued, claiming the employer violated Title VII of the Civil Rights Act of 1964 (“Title VII”).
The Court found the employer did not violate Title VII by failing to accommodate the employee’s religious belief. Reasonable accommodations eliminate conflicts between religious practices and employment requirements. According to the Court, the employer provided a reasonable accommodation through two mechanisms. First, the employer utilized a neutral, rotating shift schedule that spread weekend work among the employees. Second, the employer permitted employees to trade shifts. The opportunity to trade shifts eliminated any conflict the neutral schedule created with an employee’s request for days off.
The Court also reasoned that any additional accommodation would impose an undue hardship on the employer. Employers do not have to incur more than a de minimis cost, in lost efficiency or higher wages, to accommodate an employee’s religious practice. Here, the Court considered the following accommodations: 1) making an exception to the neutral, rotating schedule by never scheduling the employee on Sunday; or 2) moving the employee to third shift. According to the Court, these options imposed more than a de minimis cost. If the employer did not change the employee’s schedule, the employer had to a) pay someone overtime to cover the shift (placing the burden on co-workers), b) work with one less employee (loss of productivity), or c) hire another employee (additional expense).
The CBA’s neutral, rotating schedule and seniority system played a significant role in the Court’s decision. Under the CBA, seniority determined shift selection. The employee worked second shift because he was one of the least-senior union members. Therefore, if the employer moved him to a different shift, it would violate the CBA and deny other employees their contractual rights. The employer had consulted with the union, but the union was unwilling to make an exception to the neutral, rotating schedule it negotiated.
Employers subject to CBAs should consider this decision when presented with requests for accommodations based on religious belief, particularly when those requests violate the CBA.
* George S. Crisci, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law. If you have questions about the impact of religious accommodations on your workplace, please contact George (gsc@zrlaw.com) at 216.696.4441.
On April 1, 2015, the Equal Employment Opportunity Commission (“EEOC”) ruled that a federal agency discriminated against a transgendered employee when it prohibited the employee from using the common women’s restroom. Lusardi v. McHugh, Dep’t of Army, Appeal No. 0120133395, (EEOC Apr. 1, 2015). The employee presented as female and had not undergone medical procedures to transition from male to female. According to the EEOC, when the employer required the employee to use a single-user restroom, the employer committed sex discrimination in violation Title VII of the Civil Rights Act of 1964 (“Title VII”).
In its decision, the EEOC adopted a standard for determining the sex of transgendered individuals – how the employee identifies himself/herself. Specifically, the EEOC concluded “there is no cause to question that Complainant – who was assigned the sex of male at birth but identifies as female – is female.” Here, after the employee began transitioning her gender presentation, she reached a mutual agreement with her employer regarding bathroom use: she would use a single-user restroom instead of the women’s restroom until she had undergone surgery. The employer advocated this approach based on anticipated discomfort from other female employees. Subsequently, the employee used the women’s restroom when her designated restroom was out-of-order. A supervisor confronted the employee about this use, claiming the employee must prove she had undergone “the final surgery” before she could use the women’s restroom.
The EEOC concluded that the employer’s act of prohibiting the employee from using the women’s restroom constituted direct evidence of discrimination. Here, the employer admitted the employee’s transgendered status was the motivating factor for its decision to prohibit the employee from using the women’s restroom.
The EEOC also determined that restricting the employee from using the women’s restroom was an adverse employment action. According to the EEOC, “equal access to restrooms” constitutes a significant, basic condition of employment. Therefore, where a transgendered individual has begun living and working as a woman (or man), the employer must allow the employee access to the women’s (or men’s) restroom.
Finally, the EEOC rejected the employer’s arguments of 1) anticipated discomfort of female employees and 2) the employee-employer transition agreement. “Nothing in Title VII makes any medical procedure a prerequisite for equal opportunity.” The EEOC concluded an employer may not condition access to terms, conditions, or privileges of employment on completing certain medical procedures that the employer feels conclusively proves the individual’s gender identity. Even though the employee originally agreed to use the single-user restroom, employees cannot prospectively waive their Title VII rights.
This EEOC decision is not an anomaly or new trend. Rather, the EEOC has begun pursuing these types of sex discrimination cases with increasing frequency. In its most-recent Strategic Enforcement Plan, the EEOC identified “coverage of lesbian, gay, bisexual and transgender individuals under Title VII’s sex discrimination provisions” as a top enforcement priority. Additionally, as Zashin & Rich previously reported, the EEOC filed two sex-stereotyping, gender-discrimination lawsuits in September 2014. In these cases, the EEOC alleged the employer discriminated against the transgendered employee because the employee failed to conform to the employer’s “sex or gender-based preferences, expectations, or stereotypes.” On April 21, 2015, one court concluded the EEOC sufficiently stated a claim under Title VII and allowed the case to proceed. EEOC v. R.G. & G.R. Harris Funeral Homes, Inc., No. 14-13710, 2015 U.S. LEXIS 52016 (E.D. Mich. Apr. 21, 2015) In addition, the U.S. Court of Appeals for the Sixth Circuit, which covers Kentucky, Michigan, Ohio, and Tennessee, previously held that a transgendered individual presented a valid Title VII discrimination claim. Smith v. City of Salem, 378 F.3d 566 (6th Cir. 2004). On June 1, 2015, as Zashin & Rich recently highlighted, the Occupational Safety and Health Administration released a new best practice guide concerning transgendered workers’ use of workplace restrooms.
Given the EEOC’s increased emphasis on transgendered employees, employers must be cognizant of the protections Title VII and related state laws afford transgendered employees. In particular, employers should consider this EEOC decision when presented with employees transitioning their gender identity and employers should update their company handbooks and policies accordingly.
* Andrew J. Cleves, practices in all areas of labor and employment law. If you have questions about the impact of transgendered issues on your workplace, please contact Andrew (ajc@zrlaw.com) at 216.696.4441.
Recently, the trial between Ellen Pao and her former employer, venture capital firm Kleiner Perkins Caufield & Byers (“Kleiner Perkins”), captivated the business and technology world. Pao, formerly a junior partner at the firm, sued Kleiner Perkins for gender discrimination and retaliation, seeking $16 million in damages. Pao argued that the firm’s culture prevented women from advancing into the more lucrative senior partner positions and that the firm retaliated against her after she filed the lawsuit, eventually terminating her employment. Kleiner Perkins asserted that Pao’s poor performance and inability to get along with colleagues prevented her from receiving a promotion and led to her discharge. On March 26, 2015, a California jury found for Kleiner Perkins on all counts. Since then, Kleiner Perkins has sought to recover close to $1 million in expenses incurred during trial from Pao, and a judge has tentatively ruled that Pao must reimburse Kleiner Perkins for about $250,000 in expenses. Pao recently filed a notice of appeal.
The lawsuit captured headlines in major newspapers and blogs because it pulled back a curtain on the inner workings of one of Silicon Valley’s most respected venture capital firms (known for funding Google and Amazon in their start-up days). From an employment law perspective, the trial highlighted some of the benefits and pitfalls of employee performance reviews. Both sides used Pao’s performance reviews as evidence, with Pao’s attorneys claiming they showed Kleiner Perkins’ bias against Pao, and the defense relying on them as records of her sub-par performance. In particular, Pao’s attorneys’ use of the performance reviews highlights the potential for reviews to backfire against the employer if not done well. Pao’s attorneys pointed to the reviews as evidence of retaliation, since she received poor performance reviews in the year after she filed her lawsuit (despite receiving far more positive reviews the year prior). They also used the performance reviews as evidence of discrimination, noting that Pao received conflicting feedback (advising her to be both more and less aggressive) and that her male peers who received similar comments were later promoted.
The trial serves as a reminder to employers on how to best use employee performance reviews to encourage better work from employees – and how to avoid potential legal pitfalls. Performance reviews can help employers by motivating employees to improve in certain aspects of their jobs or continue good work in other areas. They also create a written record showing that the employer counseled an employee on poor performance and track improvements (or lack thereof).
Abiding by the following tips will help employers more effectively use employee performance reviews:
Finally, to the extent that the employer can identify objective criteria, the review will be all the better.
* Sarah K. Ott practices in all areas of labor and employment law. For more information about conducting employee evaluations or other questions related to performance reviews, please contact Sarah (sko@zrlaw.com) at (216) 696-4441.
The Fair Credit Reporting Act (“FCRA”) regulates the collection and use of consumer information, including employee background and credit checks, and requires employers that rely on third-party companies to conduct background checks to follow certain procedures in notifying the individual being checked. The requirements include the following:
The FCRA requires additional action from employers who take an adverse action based on the information learned from a background check conducted by a third-party company, such as deciding not to hire an applicant, revoking a job offer, or termination. Before taking the adverse action, the employer must provide the individual with a copy of the report and a document summarizing the individual’s rights under the FCRA and give the individual a meaningful opportunity to respond to the information.
Absent an adequate response and assuming the employer takes the adverse action, the employer must: (1) notify the individual of the adverse action; (2) provide the individual with specific credit score information from the report; (3) inform the individual of his or her right to obtain a free copy of the report within 60 days and dispute the information in the report; and (4) provide the contact information of the third-party company that compiled the report for the employer and explain that the third-party company did not make the decision to take the adverse action and cannot explain the reasons for the action. Employers also must destroy any background reports in a secure manner, such as by shredding them or permanently deleting electronic copies.
Despite the many requirements placed on employers by the FCRA, a spate of recent cases show that courts have little sympathy for employers who commit minor technical violations of the law, even when complying with the spirit of the law’s requirements. For example, a federal court in Virginia recently denied summary judgment to an employer who allegedly violated the FCRA when it failed to provide “stand alone” notice that it would be conducting a background check by including a liability waiver on the same document. Milbourne v. JRK Residential America, LLC, No. 3:12cv861, 2015 U.S. Dist. LEXIS 29905 (E.D. Va., Mar. 15, 2015). Other cases involve employers rescinding job offers based on information discovered through a background report before providing the job applicants with a meaningful opportunity to respond to the information. In one case, the employer revoked a job offer to an applicant based on erroneous information in a background report without giving the applicant a chance to challenge the report. Jones v. Halstead Management Co., LLC, No. 14-CV-3125, 2015 U.S. Dist. LEXIS 12807 (S.D.N.Y., Jan. 27, 2015). In another case, the employer rescinded a job offer after its receipt of an unfavorable criminal background report on an applicant without giving the applicant time to correct the inaccurate information with the consumer reporting agency before filling the position. Miller v. Johnson & Johnson, No. 6:13-cv-1016, 2015 U.S. Dist. LEXIS 4448 (M.D. Fla., Jan. 14, 2015).
In a more employer-friendly decision, a federal court in Massachusetts recently granted summary judgment for an employer despite the plaintiffs’ argument that the employer’s notice and request for authorization to conduct a background check did not limit itself “solely” to the disclosure because it included a short preamble regarding customer safety. Goldberg v. Uber Techs., Inc., No. 14-14264-RGS, 2015 U.S. Dist. LEXIS 44675 (D. Mass., Apr. 6, 2015). The court held the employer did not violate the FCRA by including “a few sensible words” about why the company chose to use background checks (i.e., customer safety). The court also found that the employer did not violate the FCRA by failing to notify the job applicant that it intended to make an adverse decision based on information included in the background report. The court found that the statute does not require advanced notice that the employer intends to take an adverse action – it merely requires providing the individual with the background report and a document stating the individual’s rights under the FCRA.
With FCRA cases seemingly on the rise, employers who use third-party companies to compile background information should review their background check policies and procedures. Failure to strictly comply with FCRA requirements can lead to costly litigation, including class action lawsuits brought on behalf of employees and applicants subject to the employer’s non-compliant background check policies and procedures.
* Drew C. Piersall works in the firm’s Columbus office and practices in all areas of labor and employment law. If you have questions about conducting background and credit checks or the FCRA in general, please contact Drew (dcp@zrlaw.com) at 614.224.4411.
Congratulations!
Drew C. Piersall was selected to serve as the Chair of the Columbus Bar Association’s Labor & Employment Law Committee for 2015-2016. The Labor & Employment Law Committee meets on a monthly basis in the fall, winter and spring. In an effort to better serve clients and the legal profession, the Committee shares ideas and provides information on topics of concern to all who participate in the field of labor and employment law.
Jonathan Downes was inducted as a Fellow into the College of Labor and Employment Lawyers. The College of Labor and Employment Lawyers is an intellectual and practical resource for the support of the legal profession and its many audiences. The primary purpose of the College is recognition of individuals, sharing knowledge, and delivering value to the many different groups who can benefit from its value model.
Seminars
Thursday, July 16, 2015 at 10:30 am
Patrick M. Watts presents "2015 Legal Update" at 10:30 a.m. at the Lake/Geauga Area Chapter of the Society for Human Resource Management luncheon.
Tuesday, September 22, 2015 at 1:00 pm
Jonathan Downes presents "Risk Management for Supervisors" for the Ohio Association of Chiefs of Police beginning at 1 p.m. at the Crowne Plaza Columbus North.
Crowne Plaza Columbus North | 6500 Doubletree Avenue, Columbus, OH
Thursday, September 24, 2015 at 10:00 am
Jonathan Downes and Drew C. Piersall present "Negotiations – Post Recession and Impact of The Affordable Care Act" for the Ohio GFOA – Annual Conference & Membership Meeting to be held at the Hilton Netherland Plaza in Cincinnati.
Hilton Netherland Plaza | 35 West Fifth Street, Cincinnati, OH
Friday, November 6, 2015 at 10:15 am
Patrick J. Hoban presents “Affordable Care Act” at 10:15 a.m. at the Ohio Conference for Payroll Professionals (OCPP) to be held at the Embassy Suites Hotel in Dublin, Ohio.
Friday, November 6, 2015 at 10:15 am
Michele L. Jakubs presents “FLSA/Time and Attendance Best Practices” at 10:15 a.m. at the Ohio Conference for Payroll Professionals (OCPP) to be held at the Embassy Suites Hotel in Dublin, Ohio.
- Religious Accommodations and Bargaining – Why Collective Bargaining Agreements May Trump Accommodations
- EEOC: Transgendered Employees Can Use the Restroom of Their Choice
- Employee Performance Reviews Have Their Day in Court: How Employers Can Get the Most out of Employee Performance Reviews
- Courts Have Little Sympathy for Employer Mistakes in Complying with the Fair Credit Reporting Act
- Z&R SHORTS
Religious Accommodations and Bargaining – Why Collective Bargaining Agreements May Trump Accommodations
By George S. Crisci*A Federal Court recently affirmed an employer’s decision to discharge a janitor who claimed the employer discriminated against him on the basis of his religious belief. Bolden v. Caravan Facilities Mgmt., LLC, No. 1:14-CV-26-RLM, 2015 U.S. LEXIS 73619 (N.D. Ind. June 8, 2015). The employer, pursuant to a neutral, rotating schedule, assigned the plaintiff-employee janitor to work on six Sundays over a ten-week span. The employer had negotiated the schedule as part of the collective bargaining agreement (“CBA”) it entered into with the employee’s union. However, the employee, an ordained Baptist minister, did not work any of the scheduled shifts. He called off, did not appear, or traded shifts with another employee in order to observe the Sabbath. After the employer terminated his employment based on unsatisfactory performance, the employee sued, claiming the employer violated Title VII of the Civil Rights Act of 1964 (“Title VII”).
The Court found the employer did not violate Title VII by failing to accommodate the employee’s religious belief. Reasonable accommodations eliminate conflicts between religious practices and employment requirements. According to the Court, the employer provided a reasonable accommodation through two mechanisms. First, the employer utilized a neutral, rotating shift schedule that spread weekend work among the employees. Second, the employer permitted employees to trade shifts. The opportunity to trade shifts eliminated any conflict the neutral schedule created with an employee’s request for days off.
The Court also reasoned that any additional accommodation would impose an undue hardship on the employer. Employers do not have to incur more than a de minimis cost, in lost efficiency or higher wages, to accommodate an employee’s religious practice. Here, the Court considered the following accommodations: 1) making an exception to the neutral, rotating schedule by never scheduling the employee on Sunday; or 2) moving the employee to third shift. According to the Court, these options imposed more than a de minimis cost. If the employer did not change the employee’s schedule, the employer had to a) pay someone overtime to cover the shift (placing the burden on co-workers), b) work with one less employee (loss of productivity), or c) hire another employee (additional expense).
The CBA’s neutral, rotating schedule and seniority system played a significant role in the Court’s decision. Under the CBA, seniority determined shift selection. The employee worked second shift because he was one of the least-senior union members. Therefore, if the employer moved him to a different shift, it would violate the CBA and deny other employees their contractual rights. The employer had consulted with the union, but the union was unwilling to make an exception to the neutral, rotating schedule it negotiated.
Employers subject to CBAs should consider this decision when presented with requests for accommodations based on religious belief, particularly when those requests violate the CBA.
* George S. Crisci, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law. If you have questions about the impact of religious accommodations on your workplace, please contact George (gsc@zrlaw.com) at 216.696.4441.
EEOC: Transgendered Employees Can Use the Restroom of Their Choice
By Andrew J. Cleves*On April 1, 2015, the Equal Employment Opportunity Commission (“EEOC”) ruled that a federal agency discriminated against a transgendered employee when it prohibited the employee from using the common women’s restroom. Lusardi v. McHugh, Dep’t of Army, Appeal No. 0120133395, (EEOC Apr. 1, 2015). The employee presented as female and had not undergone medical procedures to transition from male to female. According to the EEOC, when the employer required the employee to use a single-user restroom, the employer committed sex discrimination in violation Title VII of the Civil Rights Act of 1964 (“Title VII”).
In its decision, the EEOC adopted a standard for determining the sex of transgendered individuals – how the employee identifies himself/herself. Specifically, the EEOC concluded “there is no cause to question that Complainant – who was assigned the sex of male at birth but identifies as female – is female.” Here, after the employee began transitioning her gender presentation, she reached a mutual agreement with her employer regarding bathroom use: she would use a single-user restroom instead of the women’s restroom until she had undergone surgery. The employer advocated this approach based on anticipated discomfort from other female employees. Subsequently, the employee used the women’s restroom when her designated restroom was out-of-order. A supervisor confronted the employee about this use, claiming the employee must prove she had undergone “the final surgery” before she could use the women’s restroom.
The EEOC concluded that the employer’s act of prohibiting the employee from using the women’s restroom constituted direct evidence of discrimination. Here, the employer admitted the employee’s transgendered status was the motivating factor for its decision to prohibit the employee from using the women’s restroom.
The EEOC also determined that restricting the employee from using the women’s restroom was an adverse employment action. According to the EEOC, “equal access to restrooms” constitutes a significant, basic condition of employment. Therefore, where a transgendered individual has begun living and working as a woman (or man), the employer must allow the employee access to the women’s (or men’s) restroom.
Finally, the EEOC rejected the employer’s arguments of 1) anticipated discomfort of female employees and 2) the employee-employer transition agreement. “Nothing in Title VII makes any medical procedure a prerequisite for equal opportunity.” The EEOC concluded an employer may not condition access to terms, conditions, or privileges of employment on completing certain medical procedures that the employer feels conclusively proves the individual’s gender identity. Even though the employee originally agreed to use the single-user restroom, employees cannot prospectively waive their Title VII rights.
This EEOC decision is not an anomaly or new trend. Rather, the EEOC has begun pursuing these types of sex discrimination cases with increasing frequency. In its most-recent Strategic Enforcement Plan, the EEOC identified “coverage of lesbian, gay, bisexual and transgender individuals under Title VII’s sex discrimination provisions” as a top enforcement priority. Additionally, as Zashin & Rich previously reported, the EEOC filed two sex-stereotyping, gender-discrimination lawsuits in September 2014. In these cases, the EEOC alleged the employer discriminated against the transgendered employee because the employee failed to conform to the employer’s “sex or gender-based preferences, expectations, or stereotypes.” On April 21, 2015, one court concluded the EEOC sufficiently stated a claim under Title VII and allowed the case to proceed. EEOC v. R.G. & G.R. Harris Funeral Homes, Inc., No. 14-13710, 2015 U.S. LEXIS 52016 (E.D. Mich. Apr. 21, 2015) In addition, the U.S. Court of Appeals for the Sixth Circuit, which covers Kentucky, Michigan, Ohio, and Tennessee, previously held that a transgendered individual presented a valid Title VII discrimination claim. Smith v. City of Salem, 378 F.3d 566 (6th Cir. 2004). On June 1, 2015, as Zashin & Rich recently highlighted, the Occupational Safety and Health Administration released a new best practice guide concerning transgendered workers’ use of workplace restrooms.
Given the EEOC’s increased emphasis on transgendered employees, employers must be cognizant of the protections Title VII and related state laws afford transgendered employees. In particular, employers should consider this EEOC decision when presented with employees transitioning their gender identity and employers should update their company handbooks and policies accordingly.
* Andrew J. Cleves, practices in all areas of labor and employment law. If you have questions about the impact of transgendered issues on your workplace, please contact Andrew (ajc@zrlaw.com) at 216.696.4441.
Employee Performance Reviews Have Their Day in Court: How Employers Can Get the Most out of Employee Performance Reviews
By Sarah K. Ott*Recently, the trial between Ellen Pao and her former employer, venture capital firm Kleiner Perkins Caufield & Byers (“Kleiner Perkins”), captivated the business and technology world. Pao, formerly a junior partner at the firm, sued Kleiner Perkins for gender discrimination and retaliation, seeking $16 million in damages. Pao argued that the firm’s culture prevented women from advancing into the more lucrative senior partner positions and that the firm retaliated against her after she filed the lawsuit, eventually terminating her employment. Kleiner Perkins asserted that Pao’s poor performance and inability to get along with colleagues prevented her from receiving a promotion and led to her discharge. On March 26, 2015, a California jury found for Kleiner Perkins on all counts. Since then, Kleiner Perkins has sought to recover close to $1 million in expenses incurred during trial from Pao, and a judge has tentatively ruled that Pao must reimburse Kleiner Perkins for about $250,000 in expenses. Pao recently filed a notice of appeal.
The lawsuit captured headlines in major newspapers and blogs because it pulled back a curtain on the inner workings of one of Silicon Valley’s most respected venture capital firms (known for funding Google and Amazon in their start-up days). From an employment law perspective, the trial highlighted some of the benefits and pitfalls of employee performance reviews. Both sides used Pao’s performance reviews as evidence, with Pao’s attorneys claiming they showed Kleiner Perkins’ bias against Pao, and the defense relying on them as records of her sub-par performance. In particular, Pao’s attorneys’ use of the performance reviews highlights the potential for reviews to backfire against the employer if not done well. Pao’s attorneys pointed to the reviews as evidence of retaliation, since she received poor performance reviews in the year after she filed her lawsuit (despite receiving far more positive reviews the year prior). They also used the performance reviews as evidence of discrimination, noting that Pao received conflicting feedback (advising her to be both more and less aggressive) and that her male peers who received similar comments were later promoted.
The trial serves as a reminder to employers on how to best use employee performance reviews to encourage better work from employees – and how to avoid potential legal pitfalls. Performance reviews can help employers by motivating employees to improve in certain aspects of their jobs or continue good work in other areas. They also create a written record showing that the employer counseled an employee on poor performance and track improvements (or lack thereof).
Abiding by the following tips will help employers more effectively use employee performance reviews:
- Common standards: create and adhere to the same standards so that every employee with the same job or role is evaluated based on the same criteria;
- Set goals: doing so sets a benchmark for the employer to evaluate that employee’s performance;
- Be specific: specificity helps employees understand the employer’s expectations and helps to prevent miscommunication;
- Use deadlines: informing employees of when they are expected to reach a goal creates a record of the employer treating the employee fairly; and
- Avoid personality critiques: rather than general criticism of an employee’s personality traits, employers should focus on specific instances when that trait created a problem.
Finally, to the extent that the employer can identify objective criteria, the review will be all the better.
* Sarah K. Ott practices in all areas of labor and employment law. For more information about conducting employee evaluations or other questions related to performance reviews, please contact Sarah (sko@zrlaw.com) at (216) 696-4441.
Courts Have Little Sympathy for Employer Mistakes in Complying with the Fair Credit Reporting Act
By Drew C. Piersall*The Fair Credit Reporting Act (“FCRA”) regulates the collection and use of consumer information, including employee background and credit checks, and requires employers that rely on third-party companies to conduct background checks to follow certain procedures in notifying the individual being checked. The requirements include the following:
- The employer must notify the individual that the information obtained in the background report may be used in the employer’s decision-making. The notice must be in a “stand-alone” format and may only have minimal additional information accompanying it.
- The employer must obtain the individual’s written permission to perform the background check. The permission form may be part of the notification document.
- For permission to obtain background reports throughout the individual’s employment, the employer must clearly state that intention on the permission form.
- In order to obtain an investigative report, including information on the employee or applicant’s lifestyle, personality, and reputation, the employer must inform the individual of his or her right to a description of the investigation and its scope.
The FCRA requires additional action from employers who take an adverse action based on the information learned from a background check conducted by a third-party company, such as deciding not to hire an applicant, revoking a job offer, or termination. Before taking the adverse action, the employer must provide the individual with a copy of the report and a document summarizing the individual’s rights under the FCRA and give the individual a meaningful opportunity to respond to the information.
Absent an adequate response and assuming the employer takes the adverse action, the employer must: (1) notify the individual of the adverse action; (2) provide the individual with specific credit score information from the report; (3) inform the individual of his or her right to obtain a free copy of the report within 60 days and dispute the information in the report; and (4) provide the contact information of the third-party company that compiled the report for the employer and explain that the third-party company did not make the decision to take the adverse action and cannot explain the reasons for the action. Employers also must destroy any background reports in a secure manner, such as by shredding them or permanently deleting electronic copies.
Despite the many requirements placed on employers by the FCRA, a spate of recent cases show that courts have little sympathy for employers who commit minor technical violations of the law, even when complying with the spirit of the law’s requirements. For example, a federal court in Virginia recently denied summary judgment to an employer who allegedly violated the FCRA when it failed to provide “stand alone” notice that it would be conducting a background check by including a liability waiver on the same document. Milbourne v. JRK Residential America, LLC, No. 3:12cv861, 2015 U.S. Dist. LEXIS 29905 (E.D. Va., Mar. 15, 2015). Other cases involve employers rescinding job offers based on information discovered through a background report before providing the job applicants with a meaningful opportunity to respond to the information. In one case, the employer revoked a job offer to an applicant based on erroneous information in a background report without giving the applicant a chance to challenge the report. Jones v. Halstead Management Co., LLC, No. 14-CV-3125, 2015 U.S. Dist. LEXIS 12807 (S.D.N.Y., Jan. 27, 2015). In another case, the employer rescinded a job offer after its receipt of an unfavorable criminal background report on an applicant without giving the applicant time to correct the inaccurate information with the consumer reporting agency before filling the position. Miller v. Johnson & Johnson, No. 6:13-cv-1016, 2015 U.S. Dist. LEXIS 4448 (M.D. Fla., Jan. 14, 2015).
In a more employer-friendly decision, a federal court in Massachusetts recently granted summary judgment for an employer despite the plaintiffs’ argument that the employer’s notice and request for authorization to conduct a background check did not limit itself “solely” to the disclosure because it included a short preamble regarding customer safety. Goldberg v. Uber Techs., Inc., No. 14-14264-RGS, 2015 U.S. Dist. LEXIS 44675 (D. Mass., Apr. 6, 2015). The court held the employer did not violate the FCRA by including “a few sensible words” about why the company chose to use background checks (i.e., customer safety). The court also found that the employer did not violate the FCRA by failing to notify the job applicant that it intended to make an adverse decision based on information included in the background report. The court found that the statute does not require advanced notice that the employer intends to take an adverse action – it merely requires providing the individual with the background report and a document stating the individual’s rights under the FCRA.
With FCRA cases seemingly on the rise, employers who use third-party companies to compile background information should review their background check policies and procedures. Failure to strictly comply with FCRA requirements can lead to costly litigation, including class action lawsuits brought on behalf of employees and applicants subject to the employer’s non-compliant background check policies and procedures.
* Drew C. Piersall works in the firm’s Columbus office and practices in all areas of labor and employment law. If you have questions about conducting background and credit checks or the FCRA in general, please contact Drew (dcp@zrlaw.com) at 614.224.4411.
Z&R SHORTS
Congratulations!
Seminars
Thursday, July 16, 2015 at 10:30 am
Patrick M. Watts presents "2015 Legal Update" at 10:30 a.m. at the Lake/Geauga Area Chapter of the Society for Human Resource Management luncheon.
Tuesday, September 22, 2015 at 1:00 pm
Jonathan Downes presents "Risk Management for Supervisors" for the Ohio Association of Chiefs of Police beginning at 1 p.m. at the Crowne Plaza Columbus North.
Crowne Plaza Columbus North | 6500 Doubletree Avenue, Columbus, OH
Thursday, September 24, 2015 at 10:00 am
Jonathan Downes and Drew C. Piersall present "Negotiations – Post Recession and Impact of The Affordable Care Act" for the Ohio GFOA – Annual Conference & Membership Meeting to be held at the Hilton Netherland Plaza in Cincinnati.
Hilton Netherland Plaza | 35 West Fifth Street, Cincinnati, OH
Friday, November 6, 2015 at 10:15 am
Patrick J. Hoban presents “Affordable Care Act” at 10:15 a.m. at the Ohio Conference for Payroll Professionals (OCPP) to be held at the Embassy Suites Hotel in Dublin, Ohio.
Friday, November 6, 2015 at 10:15 am
Michele L. Jakubs presents “FLSA/Time and Attendance Best Practices” at 10:15 a.m. at the Ohio Conference for Payroll Professionals (OCPP) to be held at the Embassy Suites Hotel in Dublin, Ohio.
Monday, March 17, 2014
Employer Alert: Government Agencies Refocus On Background Checks
*By Stephen S. Zashin
On March 10, 2014, the U.S. Equal Employment Opportunity Commission (“EEOC”) and the Federal Trade Commission (“FTC”) issued joint guidance for employers and employees regarding background checks. The EEOC enforces federal employment discrimination laws, while the FTC enforces, among other things, the Fair Credit Reporting Act. The guidance documents, Background Checks: What Employers Need to Know and Background Checks: What Job Applicants and Employees Should Know, present a refresher on prior guidance from each agency. However, the joint effort suggests that each agency may increase its respective enforcement efforts with respect to employer use of background checks.
The employer guidance gives each agency’s tips on each of the following topics:
With respect to using background check information, the EEOC’s directives to employers focus on consistent application of standards to all applicants or employees. The guidance also cautions employers to “[t]ake special care when basing employment decisions on background problems that may be more common among people of a certain race, color, national origin, sex, or religion; among people who have a disability; or among people age 40 or older.”
The FTC’s contribution to the employer guidance focuses on notice obligations to applicants and employees regarding background checks, receipt of written permission from the applicant or employee prior to conducting any background check, and permitting applicants or employees an opportunity to review and explain any negative information in a background report prior to taking any adverse employment action.
Employers can expect the EEOC and FTC to coordinate their efforts in enforcing employer compliance moving forward. Employers should take this opportunity to review their existing background check procedures, particularly their use of an applicant’s or employee’s criminal and/or credit history.
*Stephen S. Zashin, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of private and public sector labor relations. For more information about background checks or labor & employment law, please contact Stephen (ssz@zrlaw.com) at 216.696.4441.
On March 10, 2014, the U.S. Equal Employment Opportunity Commission (“EEOC”) and the Federal Trade Commission (“FTC”) issued joint guidance for employers and employees regarding background checks. The EEOC enforces federal employment discrimination laws, while the FTC enforces, among other things, the Fair Credit Reporting Act. The guidance documents, Background Checks: What Employers Need to Know and Background Checks: What Job Applicants and Employees Should Know, present a refresher on prior guidance from each agency. However, the joint effort suggests that each agency may increase its respective enforcement efforts with respect to employer use of background checks.
The employer guidance gives each agency’s tips on each of the following topics:
- “Before You Get Background Information”;
- “Using Background Information”;
- “Disposing of Background Information”; and
- “Further Information”.
With respect to using background check information, the EEOC’s directives to employers focus on consistent application of standards to all applicants or employees. The guidance also cautions employers to “[t]ake special care when basing employment decisions on background problems that may be more common among people of a certain race, color, national origin, sex, or religion; among people who have a disability; or among people age 40 or older.”
The FTC’s contribution to the employer guidance focuses on notice obligations to applicants and employees regarding background checks, receipt of written permission from the applicant or employee prior to conducting any background check, and permitting applicants or employees an opportunity to review and explain any negative information in a background report prior to taking any adverse employment action.
Employers can expect the EEOC and FTC to coordinate their efforts in enforcing employer compliance moving forward. Employers should take this opportunity to review their existing background check procedures, particularly their use of an applicant’s or employee’s criminal and/or credit history.
*Stephen S. Zashin, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of private and public sector labor relations. For more information about background checks or labor & employment law, please contact Stephen (ssz@zrlaw.com) at 216.696.4441.
Tuesday, June 26, 2012
EMPLOYMENT LAW QUARTERLY | Summer 2012, Volume XIV, Issue ii
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After a five-year battle, Indiana became smoke-free on July 1, 2012 joining thirty-nine other states with similar smoking bans. The Indiana ban prohibits smoking in public places, places of employment, and government vehicles. The new law defines “place of employment” broadly as “an enclosed area of a structure that is a place of employment.” In addition, the law prohibits smoking within eight feet of a public entrance to a “public place” or “place of employment.” However, employers may designate smoking areas that are located outside the employment structure and eight feet from all public entrances.
While the vast majority of Indiana employers are required to comply with the new law, some exceptions include bars, gambling facilities, and private clubs. All other Indiana employers must remove all ashtrays and smoking paraphernalia from their premises, unless the employers are displaying the ashtrays or other smoking paraphernalia for retail sale. Employers and operators must also post signs at each public entrance informing entrants that “no smoking is permitted within eight feet of any public entrance.” If a “place of employment” is also a “public place” – and many are – the owner, operator, manager, or official in charge must also: post conspicuous signs in the public place that read “Smoking is Prohibited by State Law” or other similar language; ask anyone smoking in violation of the Act to cease smoking; and cause anyone who refuses to cease smoking “to be removed from the public place.”
Under the new law, employers must inform current employees and applicants of the prohibition. Therefore, Z&R recommends that Indiana employers add the smoking prohibition to their employment applications and handbooks. The state law specifically authorizes local governments to enact more restrictive ordinances. Thus, employers must also comply with any more restrictive local ordinances if they exist. Violations of the state smoking ban include fines up to $1,000.
*Ami J. Patel has experience representing employers in all types of labor and employment matters. Ami also has experience assisting employers with state-specific compliance issues. Please contact Ami (ajp@zrlaw.com) at 216.696.4441 for any questions on Indiana’s smoking ban.
The Equal Employment Opportunity Commission (“EEOC”) issued new enforcement guidance regarding the use of arrests and convictions in employment decisions. The EEOC last issued guidance on this issue over twenty years ago.
The EEOC enforces Title VII of the Civil Rights Act of 1964 (“Title VII”) which prohibits employment discrimination based on race, color, religion, sex, or national origin. Title VII does not list “criminal record” as a protected status against employment discrimination. Therefore, whether an employer’s reliance on a criminal record violates Title VII depends on whether it is part of a claim of employment discrimination based on race, color, religion, sex, or national origin.
The guidance describes the circumstances under which the use of arrest and conviction records in hiring may violate Title VII. Similar to prior EEOC guidance, the new EEOC guidance encourages the use of the Green factors. See Green v. Missouri Pacific Railroad Company, 523 F.2d 1158, 1160 (8th Cir. 1975). In Green, the court outlines factors employers should consider when making employment decisions based on an employee’s or applicant’s criminal history. The Green factors are:
The EEOC suggests employers should conduct an individualized assessment when making employment decisions on criminal history.The new guidance focuses on how an employer can show the exclusion is job-related and consistent with business necessity. The EEOC discusses two circumstances in which an employer's criminal conviction policy will “consistently meet” Title VII's “job-related and consistent with business necessity” defense. According to the EEOC, employers can validate their use of background screening policies and practices or develop a targeted screen using the Green factors. If the employer develops a targeted screen, the employer must provide employees with criminal records an opportunity for an “individualized assessment.”
The guidance acknowledges that Title VII does not necessarily require an individualized assessment; however, the guidance strongly suggests that employers use an “individualized assessment” in these circumstances. The individualized assessment would consist of:
The EEOC offers best practice tips for employers that include:
The Massachusetts Criminal Offender Record Information ("CORI") law created a new method and database for employers to access criminal records. CORI imposes a host of new obligations for employers. As previously reported by Z&R, part of the "ban the box" law became effective in 2010. The "ban the box" provision mandates employers remove all questions seeking information about an applicant's criminal record or criminal history on "initial written employment applications."
In addition to the "ban the box" requirement, Massachusetts employers must also maintain several CORI records and policies. The significant changes include:
*Stephen S. Zashin, an OSBA Certified Specialist in Labor and Employment law, has experience representing employers in all types of labor and employment matters. Stephen also has experience assisting employers with state-specific compliance issues. Please contact Stephen (ssz@zrlaw.com) at 216.696.4441 for any questions on the new prohibitions under Massachusetts law.
In U.S. Equal Employment Opportunity Commission v. Dillard’s, Inc., et al., the Southern District of California held that a company’s attendance policy which required an employee to submit a doctor’s note stating “the nature of the absence” and “the condition being treated” was an impermissible disability-related inquiry under the Americans with Disabilities Act, 42 U.S.C. § 12112(d)(4)(A) (“ADA”).
The ADA prohibits an employer from “making inquiries of an employee as to whether such employee is an individual with a disability or as to the nature or severity of the disability, unless such examination or inquiry is shown to be job-related and consistent with business necessity.” However, an employer “may make inquiries into the ability of an employee to perform job-related functions.” See 42 U.S.C. § 12112(d)(4)(B).
Dillard’s, Inc. El Centro Store (“Dillard’s”) had an attendance policy that would not excuse an employee’s health-related absence unless the employee submitted a doctor’s note stating “the nature of the absence (such as a migraine, high blood pressure, etc…)” and “the condition being treated.” Dillard’s terminated any employee who accumulated four unexcused absences of any kind. Three separate employees experienced difficulty in getting health-related absences approved because the doctor’s notes they submitted did not state the medical conditions that led to their absences. After bringing their concerns to the Equal Employment Opportunity Commission (“EEOC”), the EEOC brought a suit against Dillard’s on behalf of 60 individuals, claiming these individuals also were subjected to Dillard’s allegedly unlawful attendance policy. Dillard’s rescinded the attendance policy in July 2007. However, the EEOC still pursued this case on behalf of the individuals affected under the policy from 2005-2007.
The EEOC defines a “disability-related inquiry” as a question that is likely to elicit information about a disability. For example, the EEOC allows an employer to ask questions about an employee’s general well-being, whether they can perform job functions, and about current illegal drug use. Here, however, the EEOC argued that requiring the employee to disclose the health condition was a “disability-related inquiry.” Dillard’s argued that the attendance policy did not violate the plain language of the statute.
The court relied on two court decisions to find that the attendance policy made impermissible inquiries into medical conditions. First, the court relied on Conroy v. New York Department of Correctional Services, 333 F.3d 88 (2d Cir. 2003). In Conroy, the court found that an inquiry regarding a “general diagnosis” may tend to reveal a disability violating § 12112(d)(4)(A). Likewise, in Indergard v. Georgia-Pacific Corporation, 582 F.3d 1049 (9th Cir. 2009) the court found a policy impermissible which required employees to submit to a physical capacity evaluation prior to returning to work from medical leave. The Indergard court stated that an employer could inquire “into the ability of an employee to perform job-related functions,” but that it could not require a medical examination unless such examination was job-related and consistent with business necessity. Based on Conroy and Indergard, the Court concluded that Dillard’s attendance policy, on its face, permitted supervisors to conduct impermissible disability-related inquiries under the ADA. In response, Dillard’s failed to show both job-relatedness and business necessity to know the nature of the employee’s medical condition.
Employers must remain vigilant, especially in light of recent amendments that make it easier for employees to be “disabled” under the law, that their absence policies do not make impermissible inquiries into health conditions. Employers must also train managers and human resources professionals on what types of questions constitute impermissible inquiries.
*B. Jason Rossiter practices in all areas of labor & employment law and has extensive experience representing employers in disability discrimination matters. If you have any questions about your attendance policy or whether an inquiry will be permissible, contact Zashin & Rich at 216.696.4441.
Earlier this year, the Equal Employment Opportunity Commission (“EEOC”) released a decision stating that Title VII sex discrimination claims include discrimination against transgender individuals. By definition, transgender individuals self-identify as a different gender from their biological sex at birth.
The Bureau of Alcohol, Tobacco, Firearms (“ATF”) denied Mia Macy, a transgender woman, a position as a ballistics technician after she announced she was transitioning from male to female. Ms. Macy had several conversations with the lab director who allegedly told her that the position was hers, subject to a background check. During the process, she informed the lab director of her transition. A few days later, she received an email stating that the job was no longer available due to budget restrictions. However, Ms. Macy later learned that the ATF hired someone else.
Ms. Macy filed a formal internal complaint with the ATF claiming “sex stereotyping” and “gender identity” discrimination. However, the ATF only accepted her claim “based on sex (female)” under Title VII as part of its complaint process. Ms. Macy then appealed to the EEOC, which serves as an appellate tribunal for final ATF decisions and the EEOC reversed the ATF’s final decision.
The EEOC determined that the term “sex” encompasses both the biological differences between men and woman, as well as gender differences. Title VII thus bars not just discrimination on the basis of biological sex, but also on the basis of gender stereotyping—targeting someone for failing to act and appear according to expectations defined by gender. The EEOC found that if an employer intentionally discriminates against an applicant or employee because he or she is transgender, such discrimination is by definition unlawful sex discrimination.
Employers should review their employment policies and practices and consider revising them to conform to the EEOC’s decision. In some instances, employers may have to create new policies. Some policies and/or procedures that may need to be updated include:
If you are interested in attending, please RSVP to Cassandra by Thursday October 11: cflanigan@cedarbrookfinancial.com or by phone 440.683.9240- Indiana Prohibits Smoking in Places of Employment
- The EEOC Issues Guidance on Criminal Background Checks and Suggests Focusing on Individualized Assessments
- Massachusetts Criminal Background Check Law Adds to the "Ban the Box" Requirement
- Tread Lightly When Inquiring Into Employee Absences – Asking for a Doctor's Note May Violate the ADA
- EEOC Clarifies that Title VII Protects Transgendered Individuals from Employment Discrimination
- Z&R Shorts
Indiana Prohibits Smoking in Places of Employment
by Ami J. Patel*After a five-year battle, Indiana became smoke-free on July 1, 2012 joining thirty-nine other states with similar smoking bans. The Indiana ban prohibits smoking in public places, places of employment, and government vehicles. The new law defines “place of employment” broadly as “an enclosed area of a structure that is a place of employment.” In addition, the law prohibits smoking within eight feet of a public entrance to a “public place” or “place of employment.” However, employers may designate smoking areas that are located outside the employment structure and eight feet from all public entrances.
While the vast majority of Indiana employers are required to comply with the new law, some exceptions include bars, gambling facilities, and private clubs. All other Indiana employers must remove all ashtrays and smoking paraphernalia from their premises, unless the employers are displaying the ashtrays or other smoking paraphernalia for retail sale. Employers and operators must also post signs at each public entrance informing entrants that “no smoking is permitted within eight feet of any public entrance.” If a “place of employment” is also a “public place” – and many are – the owner, operator, manager, or official in charge must also: post conspicuous signs in the public place that read “Smoking is Prohibited by State Law” or other similar language; ask anyone smoking in violation of the Act to cease smoking; and cause anyone who refuses to cease smoking “to be removed from the public place.”
Under the new law, employers must inform current employees and applicants of the prohibition. Therefore, Z&R recommends that Indiana employers add the smoking prohibition to their employment applications and handbooks. The state law specifically authorizes local governments to enact more restrictive ordinances. Thus, employers must also comply with any more restrictive local ordinances if they exist. Violations of the state smoking ban include fines up to $1,000.
*Ami J. Patel has experience representing employers in all types of labor and employment matters. Ami also has experience assisting employers with state-specific compliance issues. Please contact Ami (ajp@zrlaw.com) at 216.696.4441 for any questions on Indiana’s smoking ban.
The Equal Employment Opportunity Commission Issues Guidance on Criminal Background Checks and Suggests Focusing on Individualized Assessments
by Patrick M. WattsThe Equal Employment Opportunity Commission (“EEOC”) issued new enforcement guidance regarding the use of arrests and convictions in employment decisions. The EEOC last issued guidance on this issue over twenty years ago.
The EEOC enforces Title VII of the Civil Rights Act of 1964 (“Title VII”) which prohibits employment discrimination based on race, color, religion, sex, or national origin. Title VII does not list “criminal record” as a protected status against employment discrimination. Therefore, whether an employer’s reliance on a criminal record violates Title VII depends on whether it is part of a claim of employment discrimination based on race, color, religion, sex, or national origin.
The guidance describes the circumstances under which the use of arrest and conviction records in hiring may violate Title VII. Similar to prior EEOC guidance, the new EEOC guidance encourages the use of the Green factors. See Green v. Missouri Pacific Railroad Company, 523 F.2d 1158, 1160 (8th Cir. 1975). In Green, the court outlines factors employers should consider when making employment decisions based on an employee’s or applicant’s criminal history. The Green factors are:
- The nature or gravity of the offense or conduct;
- The time elapsed since the offense, conviction, and/or completion of the sentence; and
- The nature of the job sought or held.
The EEOC suggests employers should conduct an individualized assessment when making employment decisions on criminal history.The new guidance focuses on how an employer can show the exclusion is job-related and consistent with business necessity. The EEOC discusses two circumstances in which an employer's criminal conviction policy will “consistently meet” Title VII's “job-related and consistent with business necessity” defense. According to the EEOC, employers can validate their use of background screening policies and practices or develop a targeted screen using the Green factors. If the employer develops a targeted screen, the employer must provide employees with criminal records an opportunity for an “individualized assessment.”
The guidance acknowledges that Title VII does not necessarily require an individualized assessment; however, the guidance strongly suggests that employers use an “individualized assessment” in these circumstances. The individualized assessment would consist of:
- notice to the individual that he or she has been screened out because of a criminal conviction;
- an opportunity for the individual to demonstrate that the exclusion should not be applied due to his or her particular circumstances; and
- consideration by the employer as to whether the additional information provided by the individual warrants an exception to the exclusion and shows that the policy as applied is not job-related and consistent with business necessity.
- the facts and circumstances surrounding the offense or conduct;
- the number of offenses for which the individual was convicted;
- the age of the individual at the time of conviction or release, as evidence suggests that recidivism rates tend to decline as ex-offenders’ ages increase;
- any evidence that the individual performed the same type of work, post-conviction, with the same or a different employer, with no known incidents of criminal conduct;
- the length and consistency of employment history before and after the offense or conduct;
- rehabilitation efforts, including education or training;
- employment or character references and any information regarding fitness for the particular position; and
- whether the individual is bonded.
The EEOC offers best practice tips for employers that include:
- Eliminating policies that impose an absolute bar to employment based on any conviction;
- Training hiring managers about appropriate use of conviction history in hiring and promotion and separation;
- Tailoring screening procedures to ensure that they are job-related and consistent with business necessity;
- Prohibiting asking applicants for disclosure of convictions that are not job-related and consistent with business necessity; and
- Keeping information about applicants’ and employees' conviction history confidential.
Massachusetts Criminal Background Check Law Adds to the "Ban the Box" Requirement
by Stephen S. Zashin*The Massachusetts Criminal Offender Record Information ("CORI") law created a new method and database for employers to access criminal records. CORI imposes a host of new obligations for employers. As previously reported by Z&R, part of the "ban the box" law became effective in 2010. The "ban the box" provision mandates employers remove all questions seeking information about an applicant's criminal record or criminal history on "initial written employment applications."
In addition to the "ban the box" requirement, Massachusetts employers must also maintain several CORI records and policies. The significant changes include:
- Employer Access
CORI data soon will be available to all employers via a new Web-based criminal background database, known as "iCORI."
- Notification Requirements
Employers must provide applicants and current employees with a copy of their criminal history reports before either questioning them about the reports or making adverse employment decisions based on the information therein. This requirement applies to all criminal background information, regardless of whether it is obtained through iCORI.
- Record-keeping Requirements
Employers that receive CORI data must obtain signed acknowledgment forms before conducting a search, and employers must keep the record for one year from the date of the request for information.
- Dissemination Restrictions
Employers may share CORI data only with employees that have a need to know the information. Employers also must keep a log of all persons with whom they share CORI data for a year after the date of dissemination.
- Data Storage
Employers are required to store hard copies of CORI data in locked and secured locations. Electronically stored data must be password-protected and properly encrypted.
- Written Policy Requirements
Employers that annually conduct five or more criminal background investigations must maintain a written CORI policy. This policy must indicate that the employer will notify applicants of any potential adverse decision based on CORI information, provide applicants with their CORI report and the employer policy, and provide information concerning the process for correcting a criminal record.
*Stephen S. Zashin, an OSBA Certified Specialist in Labor and Employment law, has experience representing employers in all types of labor and employment matters. Stephen also has experience assisting employers with state-specific compliance issues. Please contact Stephen (ssz@zrlaw.com) at 216.696.4441 for any questions on the new prohibitions under Massachusetts law.
Tread Lightly When Inquiring Into Employee Absences – Asking for a Doctor’s Note May Violate the ADA
by B. Jason Rossiter*In U.S. Equal Employment Opportunity Commission v. Dillard’s, Inc., et al., the Southern District of California held that a company’s attendance policy which required an employee to submit a doctor’s note stating “the nature of the absence” and “the condition being treated” was an impermissible disability-related inquiry under the Americans with Disabilities Act, 42 U.S.C. § 12112(d)(4)(A) (“ADA”).
The ADA prohibits an employer from “making inquiries of an employee as to whether such employee is an individual with a disability or as to the nature or severity of the disability, unless such examination or inquiry is shown to be job-related and consistent with business necessity.” However, an employer “may make inquiries into the ability of an employee to perform job-related functions.” See 42 U.S.C. § 12112(d)(4)(B).
Dillard’s, Inc. El Centro Store (“Dillard’s”) had an attendance policy that would not excuse an employee’s health-related absence unless the employee submitted a doctor’s note stating “the nature of the absence (such as a migraine, high blood pressure, etc…)” and “the condition being treated.” Dillard’s terminated any employee who accumulated four unexcused absences of any kind. Three separate employees experienced difficulty in getting health-related absences approved because the doctor’s notes they submitted did not state the medical conditions that led to their absences. After bringing their concerns to the Equal Employment Opportunity Commission (“EEOC”), the EEOC brought a suit against Dillard’s on behalf of 60 individuals, claiming these individuals also were subjected to Dillard’s allegedly unlawful attendance policy. Dillard’s rescinded the attendance policy in July 2007. However, the EEOC still pursued this case on behalf of the individuals affected under the policy from 2005-2007.
The EEOC defines a “disability-related inquiry” as a question that is likely to elicit information about a disability. For example, the EEOC allows an employer to ask questions about an employee’s general well-being, whether they can perform job functions, and about current illegal drug use. Here, however, the EEOC argued that requiring the employee to disclose the health condition was a “disability-related inquiry.” Dillard’s argued that the attendance policy did not violate the plain language of the statute.
The court relied on two court decisions to find that the attendance policy made impermissible inquiries into medical conditions. First, the court relied on Conroy v. New York Department of Correctional Services, 333 F.3d 88 (2d Cir. 2003). In Conroy, the court found that an inquiry regarding a “general diagnosis” may tend to reveal a disability violating § 12112(d)(4)(A). Likewise, in Indergard v. Georgia-Pacific Corporation, 582 F.3d 1049 (9th Cir. 2009) the court found a policy impermissible which required employees to submit to a physical capacity evaluation prior to returning to work from medical leave. The Indergard court stated that an employer could inquire “into the ability of an employee to perform job-related functions,” but that it could not require a medical examination unless such examination was job-related and consistent with business necessity. Based on Conroy and Indergard, the Court concluded that Dillard’s attendance policy, on its face, permitted supervisors to conduct impermissible disability-related inquiries under the ADA. In response, Dillard’s failed to show both job-relatedness and business necessity to know the nature of the employee’s medical condition.
Employers must remain vigilant, especially in light of recent amendments that make it easier for employees to be “disabled” under the law, that their absence policies do not make impermissible inquiries into health conditions. Employers must also train managers and human resources professionals on what types of questions constitute impermissible inquiries.
*B. Jason Rossiter practices in all areas of labor & employment law and has extensive experience representing employers in disability discrimination matters. If you have any questions about your attendance policy or whether an inquiry will be permissible, contact Zashin & Rich at 216.696.4441.
Equal Employment Opportunity Commission Clarifies that Title VII Protects Transgendered Individuals from Employment Discrimination
by Stefanie L. BakerEarlier this year, the Equal Employment Opportunity Commission (“EEOC”) released a decision stating that Title VII sex discrimination claims include discrimination against transgender individuals. By definition, transgender individuals self-identify as a different gender from their biological sex at birth.
The Bureau of Alcohol, Tobacco, Firearms (“ATF”) denied Mia Macy, a transgender woman, a position as a ballistics technician after she announced she was transitioning from male to female. Ms. Macy had several conversations with the lab director who allegedly told her that the position was hers, subject to a background check. During the process, she informed the lab director of her transition. A few days later, she received an email stating that the job was no longer available due to budget restrictions. However, Ms. Macy later learned that the ATF hired someone else.
Ms. Macy filed a formal internal complaint with the ATF claiming “sex stereotyping” and “gender identity” discrimination. However, the ATF only accepted her claim “based on sex (female)” under Title VII as part of its complaint process. Ms. Macy then appealed to the EEOC, which serves as an appellate tribunal for final ATF decisions and the EEOC reversed the ATF’s final decision.
The EEOC determined that the term “sex” encompasses both the biological differences between men and woman, as well as gender differences. Title VII thus bars not just discrimination on the basis of biological sex, but also on the basis of gender stereotyping—targeting someone for failing to act and appear according to expectations defined by gender. The EEOC found that if an employer intentionally discriminates against an applicant or employee because he or she is transgender, such discrimination is by definition unlawful sex discrimination.
Employers should review their employment policies and practices and consider revising them to conform to the EEOC’s decision. In some instances, employers may have to create new policies. Some policies and/or procedures that may need to be updated include:
- Equal Employment Opportunity non-discrimination and harassment policies;
- Pre-employment screening policies;
- Employee codes of conduct;
- Dress codes and appearance policies;
- Use of pronouns;
- Procedures to change information, e.g., personnel records to reflect gender change identity; and
- Policies regarding use of restrooms, locker rooms, and other gender-specific facilities.
Z&R Shorts
Soon To Be Expired Form I-9 To Remain Valid
The current Form I-9 is set to expire on August 31, 2012. The expiration date is on the upper right hand corner of the form. However, the U.S. Citizenship and Immigration Services (“USCIS”) announced earlier this month that the form would remain valid beyond this expiration date. As such, employers should continue to use the current Form I-9, until further notice from the USCIS.American Arbitration Association University
George Crisci will be part of the panel presenting “Grievance Processing” on September 13, 2012, at the Cleveland Metropolitan Bar Association, 1301 East Ninth Street, Second Level, Cleveland, Ohio. To register go to www.aaau.org.2012 Masters Series: Employment Law CLE seminar
Stephen Zashin will co-present “Wage/Hour Litigation” on September 18, 2012 at the Columbus Bar Association, 175 South Third Street, Suite 1100, Columbus, Ohio. To register go to www.cbalaw.org.ACI’s 16th National Forum on Wage & Hour Claims and Class Actions
Stephen Zashin will be part of the panel presenting “Arbitrating Wage & Hour in the Wake of AT&T Mobility and D.R. Horton on September 28, 2012 at the Hilton San Francisco Financial District in San Francisco, California. To register go to AmericanConference.com/WageHourSNF.49th Annual Midwest Labor and Employment Law Seminar
Stephen Zashin will be part of the panel presenting “Managing Cost of E-Discovery” on October 12, 2012 at the Hilton, Easton Town Center in Columbus, Ohio. To register go to www.ohiobar.org.Health Care Reform… How will it affect you?
Pat Hoban is the keynote speaker for the FREE seminar and breakfast presented by Cedar Brook Financial Partners on Tuesday, October 16th, 2012 at 9:00am at Cedar Brook Financial Partners, 5885 Landerbrook Drive, Mayfield Heights, Ohio 44124. Seminar will take place in the Garage Level Conference RoomLabor Law Seminar presented by Faulkner, Hoffman & Phillips, LLC
Jon Dileno will co-present “Grievance/Arbitration Processing Strategy” on October 29, 2012 at the FOP 67 Lodge Hall.American Bar Association Section of Labor and Employment Law
6th Annual Labor and Employment Law ConferenceGeorge Crisci will be part of the panel presenting “One Year After Wisconsin and Ohio – The State of the Public Sector” on November 2, 2012, at the Westin Peachtree Plaza, 210 Peachtree St SW. Atlanta, GA. To register go to www.americanbar.org.
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