By Patrick J. Hoban*
Yesterday, the Federal District Court for the Northern District of Texas made permanent the preliminary injunction it issued earlier this year to prevent the U.S. Department of Labor (“DOL”) from enforcing its controversial “persuader” rule (“Persuader Rule”). Judge Sam R. Cummings announced the decision on Wednesday in a concise two-page opinion, in which he concluded that the Persuader Rule violated the federal Administrative Procedure Act, 5 U.S.C. § 706 (“APA”) and is unenforceable. The case, National Federation of Independent Businesses v. Perez, No. 5:16-cv-00066-C (N.D. Texas, November 16, 2016), effectively converts the preliminary injunction granted by the same court on June 27, 2016 into a permanent injunction with nationwide effect.
The Persuader Rule, which took effect on April 25, 2016, dramatically expanded the reporting requirements imposed on employers and their labor relations consultants under the Labor-Management Reporting and Disclosure Act of 1959 (“LMRDA”). Under the LMRDA, employers and their labor relations consultants are required to disclose agreements to engage in activities to persuade employees regarding their rights to unionize and collectively bargain. These onerous disclosure reports required that employers, attorneys and consultants provide details about the nature and cost of the services consultants provide. Although the reporting requirements were subject to certain exemptions, including an exemption related to the provision of “advice,” the DOL’s guidance on the Persuader Rule made clear that it would decide what services qualified as advice on a case-by-case basis.
Historically, the DOL has interpreted the “advice” exemption to exclude from the reporting requirements an employer’s engagement of consultants, including attorneys, to assist in responding to a unionizing campaign, where: (1) the consultant or attorney had no direct contact with the employees; and (2) the employer retained discretion to reject the recommendations of the consultant or attorney. The DOL’s new Persuader Rule upended this long-standing interpretation by requiring employers and labor relations consultants to report their agreements even in the absence of direct contact between the consultants and the employees.
U.S. Secretary of Labor Thomas E. Perez defended the Persuader Rule from withering criticism, describing the changes as a “matter of basic fairness” to ensure that workers have “the information they need to make informed choices about how they pursue their rights to organize and bargain collectively.” Employers, labor relations consultants, and attorneys opposed the changes. Of particular concern was the extent to which the Persuader Rule would have compelled employers and law firms to disclose information protected by the attorney-client privilege. Absent the Court’s June injunction, enforcement of the Persuader Rule and its new reporting requirements would have begun on July 1, 2016.
Yesterday, Judge Cummings granted summary judgment to those challenging the Persuader Rule and reiterated his previous conclusions that it was “defective to its core,” “arbitrary and capricious,” “violated free speech and association rights,” and was “unconstitutionally vague.” Additionally, Judge Cummings affirmed that the Persuader Rule violated the Administrative Procedures Act and that the DOL did not have authority to issue it. On these grounds, the Court issued a nationwide permanent injunction prohibiting enforcement of the Persuader Rule.
The DOL previously appealed Judge Cumming’s decision granting the preliminary injunction of its Persuader Rule to the U.S. Fifth Circuit Court of Appeals, but that appeal was rendered moot by Wednesday’s summary judgment ruling. However, in June 2016, a federal district court in Minnesota refused to enjoin the Persuader rule.
The Persuader Rule is one among several hotly-contested Obama administration changes to employment and labor relations law. Those changes have caused significant disruption and include the National Labor Relations Board (“NLRB”)’s “ambush” election rules, the NLRB’s Specialty Healthcare decision that opened the floodgates for “micro” union organizing, and the DOL’s changes to the salary threshold for exempt status under the Fair Labor Standards Act (“FLSA”) (which likely takes effect on December 1, 2016).
Like the Persuader Rule, the DOL changes to FLSA exemptions were also challenged in federal court in Texas by twenty-one states and multiple business entities – including challenges under the Administrative Procedures Act. Although the new FLSA exemptions rule takes effect on December 1, the judge in that case announced yesterday that on November 22 he will issue a decision on whether DOL will be prohibited from enforcing the new rule. As a result, we will soon see if the Eastern District of Texas reaches the same conclusion with regard to the changes to the FLSA exemptions as Judge Cummings did for the Persuader Rule.
Yesterday’s decision is subject to appeal. However, as President-Elect Donald Trump will take office in January, there is reason to believe the Trump DOL will not seek review. The Court’s ruling on the Persuader Rule provides employers with relief from reporting requirements and potential liability. As we look to the future, it is anticipated that Trump administration appointments at DOL and the NLRB may offer employers a more level playing field.
*Patrick Hoban, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of private and public sector labor relations. For more information about the DOL’s persuader rule or labor & employment law, please contact Pat (pjh@zrlaw.com) at 216.696.4441.
Thursday, November 17, 2016
Friday, November 11, 2016
Specialty Healthcare Five Years Later – Despite Assurances to the Contrary, Micro-Union Organizing Proliferates
By Andrew J. Cleves*
Five years ago, the National Labor Relations Board (“NLRB”) altered the union organizing landscape by changing its analysis of union-proposed bargaining units. In Specialty Healthcare and Rehabilitation Center of Mobile, 357 NLRB 934 (2011) (“Specialty Healthcare”), the NLRB established a new standard for determining whether unions may propose a unit comprised of only a small group of employees (a “micro-unit”) over an employer’s objection.
Under the Specialty Healthcare standard, a union-proposed bargaining unit is presumptively appropriate and employers must prove that the excluded employees share an “overwhelming community of interest” with the employees included in the union-proposed unit.
Justifiably, the NLRB’s Specialty Healthcare decision concerned employers. It allows unions to cherry pick “micro” bargaining units comprised almost exclusively of union-supportive employees. This offers unions a strategic foothold even in businesses where a majority of workers do not support unionization. Furthermore, the NLRB’s new requirement for an “overwhelming community of interest” makes it more difficult for employers to effectively challenge a union-proposed unit.
Anticipating criticism, the NLRB went to great lengths to assure employers of Specialty Healthcare’s limited change and impact when it announced the decision. The NLRB claimed that it merely “clarified” the criteria used in instances “where a party argues that a proposed bargaining unit is inappropriate.” The NLRB also insisted the Specialty Healthcare decision “did not create new criteria for determining appropriate bargaining units outside of healthcare facilities.”
However, those assurances have rung hollow as employers across numerous industries have experienced an uptick in union organizing activities targeted at small fragments of their workforces. As the U.S. Chamber of Commerce highlighted in its Trouble With The Truth: Specialty Healthcare and the Spread of Micro-Union Report, released on October 31, 2016, the following industries have felt the sting of the NLRB’s approval of “micro” bargaining units:
Employers are likely to face the reverberating effects of Specialty Healthcare for years to come. To date, federal courts of appeals have upheld Specialty Healthcare’s “overwhelming community of interest” test and legislative proposals to overturn the decision have proven unsuccessful.
Furthermore, recent NLRB changes have compounded the effects of Specialty Healthcare and more changes may be on the horizon. As Zashin & Rich reported in March 2015, the NLRB’s “ambush” election rules have made it significantly more difficult for employers to run an effective campaign against unionization. In addition, the NLRB may address the following topics before the end of the current presidential administration: regulatory actions related to joint-employment; “captive audience” meetings; and the definition of independent contractors, further hampering employer’s efforts to remain union-free.
Employers who oppose unionization should consider regular communication about the perils of union representation with employees prior to any sign of a union organizing effort. Additionally, upon receiving notice that a union has filed a representation petition, no matter how small or fragmented the proposed unit may be, employers should immediately contact counsel to manage the risk of a union gaining a foothold among their workforce.
*Andrew J. Cleves practices in all areas of labor and employment law. For more information about “micro” bargaining unit organizing, the NLRB, or its regulatory decisions, please contact Andrew (ajc@zrlaw.com) at 216.696.4441.
Five years ago, the National Labor Relations Board (“NLRB”) altered the union organizing landscape by changing its analysis of union-proposed bargaining units. In Specialty Healthcare and Rehabilitation Center of Mobile, 357 NLRB 934 (2011) (“Specialty Healthcare”), the NLRB established a new standard for determining whether unions may propose a unit comprised of only a small group of employees (a “micro-unit”) over an employer’s objection.
Under the Specialty Healthcare standard, a union-proposed bargaining unit is presumptively appropriate and employers must prove that the excluded employees share an “overwhelming community of interest” with the employees included in the union-proposed unit.
Justifiably, the NLRB’s Specialty Healthcare decision concerned employers. It allows unions to cherry pick “micro” bargaining units comprised almost exclusively of union-supportive employees. This offers unions a strategic foothold even in businesses where a majority of workers do not support unionization. Furthermore, the NLRB’s new requirement for an “overwhelming community of interest” makes it more difficult for employers to effectively challenge a union-proposed unit.
Anticipating criticism, the NLRB went to great lengths to assure employers of Specialty Healthcare’s limited change and impact when it announced the decision. The NLRB claimed that it merely “clarified” the criteria used in instances “where a party argues that a proposed bargaining unit is inappropriate.” The NLRB also insisted the Specialty Healthcare decision “did not create new criteria for determining appropriate bargaining units outside of healthcare facilities.”
However, those assurances have rung hollow as employers across numerous industries have experienced an uptick in union organizing activities targeted at small fragments of their workforces. As the U.S. Chamber of Commerce highlighted in its Trouble With The Truth: Specialty Healthcare and the Spread of Micro-Union Report, released on October 31, 2016, the following industries have felt the sting of the NLRB’s approval of “micro” bargaining units:
- General Aviation Service: The proposed unit included only 34 “line service” employees in a general aviation service business with 110 employees overall.
- Telecommunications: The petitioned-for bargaining unit included 16 T-Mobile field and switch technicians who worked in Long Island, NY but excluded employees who worked in New York City’s boroughs and both Long Island counties.
- Rental Car Facility: All 109 employees did not share an overwhelming community of interest with 31 rental service agents and lead rental service agents.
- Retail Department Store: In a Macy’s department store of 150 employees, including 120 sales associates, the approved bargaining unit included only 41 cosmetics and fragrance sales representatives.
- Fast-Casual Dining: The NLRB approved a bargaining unit which included 17 out of 43 bakers working at six out of 17 Panera Bread cafés.
- Automobile Manufacturing: The NLRB approved a micro-unit of 152 maintenance workers at a Volkswagen plant despite the fact that the union disregarded the company’s shop structure and essentially “invented” a new maintenance department.
Employers are likely to face the reverberating effects of Specialty Healthcare for years to come. To date, federal courts of appeals have upheld Specialty Healthcare’s “overwhelming community of interest” test and legislative proposals to overturn the decision have proven unsuccessful.
Furthermore, recent NLRB changes have compounded the effects of Specialty Healthcare and more changes may be on the horizon. As Zashin & Rich reported in March 2015, the NLRB’s “ambush” election rules have made it significantly more difficult for employers to run an effective campaign against unionization. In addition, the NLRB may address the following topics before the end of the current presidential administration: regulatory actions related to joint-employment; “captive audience” meetings; and the definition of independent contractors, further hampering employer’s efforts to remain union-free.
Employers who oppose unionization should consider regular communication about the perils of union representation with employees prior to any sign of a union organizing effort. Additionally, upon receiving notice that a union has filed a representation petition, no matter how small or fragmented the proposed unit may be, employers should immediately contact counsel to manage the risk of a union gaining a foothold among their workforce.
*Andrew J. Cleves practices in all areas of labor and employment law. For more information about “micro” bargaining unit organizing, the NLRB, or its regulatory decisions, please contact Andrew (ajc@zrlaw.com) at 216.696.4441.
Thursday, November 10, 2016
Will Trump Dump The New DOL Rule Regarding Exempt Status?
By Michele L. Jakubs*
Will President-Elect Donald Trump provide employers with a reprieve from the Department of Labor’s (“DOL”) new rule regarding overtime? We will all have to wait and see.
On May 18, 2016, the DOL announced its final rule increasing the salary thresholds for exemptions under the Fair Labor Standards Act (“FLSA”). To meet an exemption from overtime under the new rule, employees must meet both the duties test and the increased salary requirement. The final rule sets the new salary threshold for “white collar” exemptions at $47,476 annually. For the highly-compensated employee exemption, the new salary threshold is set at $134,004 annually. The final rule (including the new salary thresholds) goes into effect on December 1, 2016.
The FLSA generally requires employers to pay employees for any time worked in excess of forty hours per work week at a rate of one-and-a-half times the employee’s regular rate. The FLSA exempts “white collar” employees from the overtime requirement, provided the employees meet specific criteria: (1) the employees receive a fixed salary; (2) the salary meets the minimum threshold requirement (currently $455 per week, or $23,660 per year) which increases to $913 per week, or $47,476 per year on December 1; and, (3) the employees’ responsibilities primarily involve executive, administrative, or professional duties (the “duties test”). Highly-compensated employees who regularly perform one or more exempt duties also are exempt.
In September, 21 states, including Ohio, filed a lawsuit, State of Nevada, et al. v. U.S. Dept. of Labor, et al., in federal court, challenging the final rule. The Court consolidated this case with a similar case filed by various business associations and Chambers of Commerce. The States seek a declaratory judgment from the Court holding that, among other things: (1) the final rule is unlawful under the Constitution; (2) the final rule’s automatic indexing of the salary-basis test every three years is without Constitutional authority and violates the Administrative Procedure Act; and, (3) the final rule is unconstitutional as applied to the States. The States also have asked the Court to issue an injunction enjoining the final rule from having any legal effect. The Court has not yet ruled and briefing is not yet complete.
Employers should continue to prepare for the December 1, 2016 implementation of the final rule. At this point, it remains unclear whether President-Elect Trump will take action to repeal or modify the new rule once he takes office in January 2017. It also remains possible that the Court hearing the case from the States and business Plaintiffs may issue an order staying the effective date of the final rule pending resolution of the legal challenges. Absent an action by the government or the Court, the new rule will take effect on December 1, 2016. Z&R will continue to monitor the status of the new rule and will issue further client alerts as information becomes available.
*Michele L. Jakubs, an OSBA Certified Specialist in Labor and Employment Law, has extensive experience defending employers in FLSA actions and is well versed in the nuances of the law. If you have questions about the DOL’s final rule or the FLSA more generally, please contact Michele (mlj@zrlaw.com) at 216.696.4441.
Will President-Elect Donald Trump provide employers with a reprieve from the Department of Labor’s (“DOL”) new rule regarding overtime? We will all have to wait and see.
On May 18, 2016, the DOL announced its final rule increasing the salary thresholds for exemptions under the Fair Labor Standards Act (“FLSA”). To meet an exemption from overtime under the new rule, employees must meet both the duties test and the increased salary requirement. The final rule sets the new salary threshold for “white collar” exemptions at $47,476 annually. For the highly-compensated employee exemption, the new salary threshold is set at $134,004 annually. The final rule (including the new salary thresholds) goes into effect on December 1, 2016.
The FLSA generally requires employers to pay employees for any time worked in excess of forty hours per work week at a rate of one-and-a-half times the employee’s regular rate. The FLSA exempts “white collar” employees from the overtime requirement, provided the employees meet specific criteria: (1) the employees receive a fixed salary; (2) the salary meets the minimum threshold requirement (currently $455 per week, or $23,660 per year) which increases to $913 per week, or $47,476 per year on December 1; and, (3) the employees’ responsibilities primarily involve executive, administrative, or professional duties (the “duties test”). Highly-compensated employees who regularly perform one or more exempt duties also are exempt.
In September, 21 states, including Ohio, filed a lawsuit, State of Nevada, et al. v. U.S. Dept. of Labor, et al., in federal court, challenging the final rule. The Court consolidated this case with a similar case filed by various business associations and Chambers of Commerce. The States seek a declaratory judgment from the Court holding that, among other things: (1) the final rule is unlawful under the Constitution; (2) the final rule’s automatic indexing of the salary-basis test every three years is without Constitutional authority and violates the Administrative Procedure Act; and, (3) the final rule is unconstitutional as applied to the States. The States also have asked the Court to issue an injunction enjoining the final rule from having any legal effect. The Court has not yet ruled and briefing is not yet complete.
Employers should continue to prepare for the December 1, 2016 implementation of the final rule. At this point, it remains unclear whether President-Elect Trump will take action to repeal or modify the new rule once he takes office in January 2017. It also remains possible that the Court hearing the case from the States and business Plaintiffs may issue an order staying the effective date of the final rule pending resolution of the legal challenges. Absent an action by the government or the Court, the new rule will take effect on December 1, 2016. Z&R will continue to monitor the status of the new rule and will issue further client alerts as information becomes available.
*Michele L. Jakubs, an OSBA Certified Specialist in Labor and Employment Law, has extensive experience defending employers in FLSA actions and is well versed in the nuances of the law. If you have questions about the DOL’s final rule or the FLSA more generally, please contact Michele (mlj@zrlaw.com) at 216.696.4441.
Wednesday, November 2, 2016
EMPLOYMENT LAW QUARTERLY | Volume XVIII, Issue iii
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More specifically, Ohio has a statute limiting an employer’s influence over how employees vote on Election Day. Ohio Revised Code 3599.05 makes it illegal for an employer or his agent or a corporation to:
A violation of this statute is punishable by a fine of $500 - $1,000.
In 2011, the owner of a fast food restaurant violated R.C. 3599.05 when, in the month preceding the election, the employer enclosed a letter containing the company’s logo on it with each employee’s pay check that stated:
The letter then listed the candidates the owner believed would help the business move forward.
At least one employee filed a complaint against the owner with local prosecutors. The Ohio Secretary of State investigated the claim and recommended charges against the owner. Ultimately, the owner pled no contest to a violation of R.C. 3599.05 and agreed to pay a $1,000 fine.
Accordingly, Ohio employers must understand that there are limits to the amount of influence they can exert over their employees’ choices at the ballot box. If an employer wishes to publish political opinions to their employees, they should consult counsel to help avoid violating the law.
*Brad S. Meyer practices in all areas of public and private labor and employment law. For more information on political speech in the workplace or other labor and employment questions, please contact Brad at bsm@zrlaw.com or 216.696.4441.
The following table summarizes the key aspects of state voting laws:
DOWNLOAD PDF OF TABLE
In addition to the state laws summarized above, employers also should know about any local ordinances relating to employee time off for voting. With Election Day fast approaching, employers should understand the validity of an employee request for time off to vote and prepare for the impact of any voting-related absences upon business operations.
*Brad E. Bennett practices in all areas of public and private labor and employment law. For more information on employee leave or other labor and employment questions, please contact Brad at beb@zrlaw.com or 614.224.4411.
Generally, the ADA prohibits employers with 15 or more employees from discriminating against individuals on the basis of a disability. To prevent such discrimination, the ADA restricts employers with respect to obtaining medical information from employees and applicants. Notwithstanding the general restriction, however, the ADA permits employers to make certain inquiries of employees regarding their health and to conduct medical exams of employees when such requests are part of voluntary EHPs.
Voluntary EHPs encompass health promotion and disease prevention programs and activities offered to employees as part of an employer sponsored health plan or as a benefit of employment. The EEOC promulgated the new rules to guide employers who may offer incentives to employees to participate in wellness programs that require them to answer disability-related inquiries or undergo a medical examination.
Under the ADA, participation in an EHP must be voluntary. An EHP is voluntary if: (1) it does not require employees to participate; (2) it does not deny coverage under any of its group health plans or limit the extent of benefits (with some limited exceptions) due to non-participation; (3) it does not result in any adverse employment action or retaliation against any employees; and (4) it provides notice to employees regarding the use of their health information.
The new rules issued by the EEOC provide employers further guidance on the fourth prong of the voluntary test - the notice requirement. While the EEOC provides a Sample Notice for Employee-Sponsored Wellness Programs, employers are not required to use the EEOC sample. Under the new rules, an employer is required to provide employees with notice that: “(A) is written so that the employee from whom medical information is being obtained is reasonably likely to understand it; (B) describes the type of medical information that will be obtained and the specific purposes for which the medial information will be used; and (C) describes the restrictions on the disclosure of the employee’s medical information, the employer representatives or other parties with whom the information will be shared, and the methods that the covered entity will use to ensure that medical information is not improperly disclosed (including whether it complies with the measures set forth in the HIPAA regulations).”
After much debate, the EEOC declined to include a requirement that employees participating in EHPs provide prior written and knowing confirmation that their participation is voluntary. In making its determination, the EEOC sought to ensure that no employee unwittingly authorized the dissemination of confidential and protected information, while refusing to place unwieldy burdens on an employer. In order to balance those competing interests, the EEOC ruled that “a covered entity may not require an employee to agree to the sale, exchange, sharing, transfer, or other disclosure of medical information, or to waive confidentially protections available under the ADA as a condition for participating in a wellness program or receiving a wellness program incentive.”
The EEOC rules go into effect on the first day of the first plan year for benefits beginning on or after January 1, 2017. With open enrollments quickly approaching, it is important for employers to make sure they are familiar with the new EEOC rules. Employers can expect the EEOC and employee groups to enforce compliance with the new notice rules through litigation.
Employers also must understand that this is just one of the rules that govern EHPs. Implementation of these programs requires compliance with a host of laws and regulations, including but not limited to: HIPAA, Title II of GINA (also enforced by the EEOC), the Affordable Care Act and others.
*Patrick J. Hoban practices in all areas of employment and labor law. If you have questions about employee health programs or other employment and labor law issues, please contact Pat (pjh@zrlaw.com) at 216.696.4441.
Title VII of the Civil Rights Act of 1964 (“Title VII”) forbids religious discrimination. Specifically, the statute’s “disparate treatment” provision prohibits employers from failing/refusing to hire, discharging, or otherwise discriminating against an applicant/employee “because of” the applicant’s/employee’s religion. Title VII defines religion to include all aspects of religious observance, practice, and belief.
Religious disparate treatment claims often arise in the form of “failure to accommodate” allegations. Generally, to succeed on a failure to accommodate claim, the applicant/employee initially must prove that: (1) he/she holds a sincere religious belief that conflicts with a job requirement; (2) he/she informed the employer about the conflict; and (3) the employer discharged or disciplined the applicant/employee for failing to comply with the conflicting job requirement.
Title VII defines religious belief broadly. For example, one court acknowledged that Title VII provides atheists with the same protections as members of other religions and found a plaintiff’s atheistic beliefs sincere. See Mathis v. Christian Heating and Air Conditioning, Inc., 158 F. Supp. 3d 317 (E.D. Pa. 2016). There, the plaintiff’s atheistic beliefs conflicted with a job requirement to wear an I.D. badge that included a religious mission statement.
The United States Supreme Court recently relieved applicants/employees from demonstrating, in some cases, that the applicant/employee informed the employer of a conflict between the job requirement and religious belief. In EEOC v. Abercrombie & Fitch Stores, Inc., 135 S. Ct. 2028 (2015), the Court held the employer does not need specific knowledge of the applicant’s/employee’s religion or need for accommodation in intentional religious discrimination cases. Rather, an employer who acts with the motive to avoid an applicant’s/employee’s religious practice or need for religious accommodation – even if based on nothing more than an unsubstantiated suspicion – may violate Title VII. An applicant’s/employee’s religion cannot be a “motivating factor” in the employer’s decision.
If an applicant/employee establishes a prima facie failure to accommodate claim, the employer must show that accommodating the employee would impose an undue hardship on the employer. Undue hardship means more than a de minimis cost. Historically, courts have considered accommodations that result in the following undue hardships: requiring an employer to pay overtime; requiring an employer to hire replacement employees; requiring an employer to make additional contributions to insurance and pension funds; requiring an employer to take action that compromises schedule or seniority systems; and requiring an employer to risk regulatory or criminal sanctions.
In addition, Title VII mandates that an employee cooperate with the employer’s attempts to provide a religious accommodation. Courts may be more likely to find undue hardship where the employee refuses to compromise. For example, a FedEx employee insisted that she keep her operations manager position and get all Saturdays off. The company showed such arrangement would have created a safety risk because the company needed all managers available every day during peak season to assist in loading and launching aircraft. The court found that allowing the employee not to work during peak season imposed an undue hardship. See Burdette v. Federal Express Corp., 367 Fed. App’x 628 (6th Cir. 2010).
Employers should address claims of religious discrimination and requests for accommodation carefully and on an individualized basis. In its Abercrombie & Fitch decision, the United States Supreme Court concluded Title VII does not demand mere neutrality with regard to religious practices. Rather, “it gives [employees seeking religious accommodations] favored treatment.” When evaluating accommodation requests, employers should evaluate carefully the costs of an accommodation, work with the employee to find a solution, and contact employment counsel with questions.
*Drew C. Piersall practices in all areas of employment and labor law. If you have questions about religious discrimination, accommodations, or the EEOC’s enforcement efforts, please contact Drew (dcp@zrlaw.com) at 614.224.4411.
Scott DeHart’s practice will focus on all areas of private and public sector labor and employment law and litigation. Scott graduated summa cum laude from New York Law School, where he focused his studies on labor and employment law. As a law student, Scott was selected as Champion of the NKU Grosse Moot Court Competition. Prior to joining Zashin & Rich, Scott pursued a career as a Human Resources practitioner, most recently as a Director of Human Resources at Columbia University. In that capacity, Scott ensured the effective design and administration of a broad range of HR programs and served on the university’s collective bargaining team.
Monday, November 7, 2016
George S. Crisci presents “The National Labor Relations Board – Obligations and Compliance” and “Other Employment Laws You Need to Know” at the National Business Institute’s Seminar on Human Resource Law from Start to Finish at the CMBA Conference Center, One Cleveland Center, 1375 E 9th St, Cleveland, Ohio 44114.
Friday, November 18, 2016
Jonathan J. Downes presents “FLSA – New Rules and Practical Solutions” at the CAAO Winter Conference during the 9:00 am – 10:30 am session. The conference takes place at the Embassy Suites Dublin, 5100 Upper Metro Place, Dublin, 43017.
Thursday, December 8, 2016
George S. Crisci will participate, as the Management Panelist, in the presentation “A View from the Chair of the National Labor Relations Board.” The featured panelist will be NLRB Chairman Mark G. Pearce. Patrick J. Hoban will participate, as the Management Panelist, in the presentation “Applying the NLRA to Employer Handbooks and Other Employer Policies.” The presentations will occur at 12:30 p.m. and 1:45 p.m., as part of the Ohio State Bar Association’s “National Labor Relations Board Update: Times and Laws are Changing” seminar, which will be held at the Ohio State Bar Association headquarters, 1700 Lake Shore Drive, Columbus, Ohio 43204.
For more information regarding this seminar, please contact Linda Morris – CLE Program Coordinator for the Ohio State Bar Association at 614-487-4408 or email at lmorris@ohiobar.org.
- Not So Fast (Food): Ohio Employer Goes Too Far With Supersized Influence Over His Employees’ Voting Decisions
- Elections and the Workplace: Employee Time Off for Voting
- EEOC Changes the Notice Employers are Required to Provide Employees Participating in an Employee Health Program
- Religious Discrimination on the Horizon: EEOC Targets Enforcement
- Z&R SHORTS
Not So Fast (Food): Ohio Employer Goes Too Far With Supersized Influence Over His Employees’ Voting Decisions
With a hotly debated election season upon us, everyone seems to have an opinion on the candidates and significant ballot issues. While political discussions are common in the workplace, Ohio employers cannot influence their employees’ votes.More specifically, Ohio has a statute limiting an employer’s influence over how employees vote on Election Day. Ohio Revised Code 3599.05 makes it illegal for an employer or his agent or a corporation to:
print or authorize to be printed upon any pay envelopes any statements intended or calculated to influence the political action of his or its employees; or post or exhibit in the establishment or anywhere in or about the establishment any posters, placards, or hand bills containing any threat, notice, or information that if any particular candidate is elected or defeated work in the establishment will cease in whole or in part, or other threats expressed or implied, intended to influence the political opinions or votes of his or its employees.
A violation of this statute is punishable by a fine of $500 - $1,000.
In 2011, the owner of a fast food restaurant violated R.C. 3599.05 when, in the month preceding the election, the employer enclosed a letter containing the company’s logo on it with each employee’s pay check that stated:
As the election season is here we wanted you to know which candidates will help our business grow in the future. As you know, the better our business does it enables us to invest in our people and our restaurants. If the right people are elected we will be able to continue with raises and benefits at or above our present levels. If others are elected we will not. As always who you vote for is completely your personal decision and many factors go into your decision.
The letter then listed the candidates the owner believed would help the business move forward.
At least one employee filed a complaint against the owner with local prosecutors. The Ohio Secretary of State investigated the claim and recommended charges against the owner. Ultimately, the owner pled no contest to a violation of R.C. 3599.05 and agreed to pay a $1,000 fine.
Accordingly, Ohio employers must understand that there are limits to the amount of influence they can exert over their employees’ choices at the ballot box. If an employer wishes to publish political opinions to their employees, they should consult counsel to help avoid violating the law.
*Brad S. Meyer practices in all areas of public and private labor and employment law. For more information on political speech in the workplace or other labor and employment questions, please contact Brad at bsm@zrlaw.com or 216.696.4441.
Elections and the Workplace: Employee Time Off for Voting
As Election Day approaches, employers will receive requests from employees for time off from work to go vote. As there is no federal law governing time off for voting, numerous states have enacted laws governing employee leave for voting. In the 29 states that currently have laws providing for voting leave, the requirements vary. For example, 21 of those states require employers to provide paid time off to employees to vote.The following table summarizes the key aspects of state voting laws:
DOWNLOAD PDF OF TABLE
In addition to the state laws summarized above, employers also should know about any local ordinances relating to employee time off for voting. With Election Day fast approaching, employers should understand the validity of an employee request for time off to vote and prepare for the impact of any voting-related absences upon business operations.
*Brad E. Bennett practices in all areas of public and private labor and employment law. For more information on employee leave or other labor and employment questions, please contact Brad at beb@zrlaw.com or 614.224.4411.
EEOC Changes the Notice Employers are Required to Provide Employees Participating in an Employee Health Program
The Equal Employment Opportunity Commission (“EEOC”) recently published final rules under the Americans with Disabilities Act (“ADA”) for employers who offer certain wellness programs that collect employee health information. Specifically, the EEOC detailed what type of notice employers must provide regarding the use of employee health information. According to the EEOC, the new rules ensure that Employee Health Programs (“EHPs”) “are reasonably designed to promote health and prevent disease, that they are voluntary, and that employee medical information is kept confidential.”Generally, the ADA prohibits employers with 15 or more employees from discriminating against individuals on the basis of a disability. To prevent such discrimination, the ADA restricts employers with respect to obtaining medical information from employees and applicants. Notwithstanding the general restriction, however, the ADA permits employers to make certain inquiries of employees regarding their health and to conduct medical exams of employees when such requests are part of voluntary EHPs.
Voluntary EHPs encompass health promotion and disease prevention programs and activities offered to employees as part of an employer sponsored health plan or as a benefit of employment. The EEOC promulgated the new rules to guide employers who may offer incentives to employees to participate in wellness programs that require them to answer disability-related inquiries or undergo a medical examination.
Under the ADA, participation in an EHP must be voluntary. An EHP is voluntary if: (1) it does not require employees to participate; (2) it does not deny coverage under any of its group health plans or limit the extent of benefits (with some limited exceptions) due to non-participation; (3) it does not result in any adverse employment action or retaliation against any employees; and (4) it provides notice to employees regarding the use of their health information.
The new rules issued by the EEOC provide employers further guidance on the fourth prong of the voluntary test - the notice requirement. While the EEOC provides a Sample Notice for Employee-Sponsored Wellness Programs, employers are not required to use the EEOC sample. Under the new rules, an employer is required to provide employees with notice that: “(A) is written so that the employee from whom medical information is being obtained is reasonably likely to understand it; (B) describes the type of medical information that will be obtained and the specific purposes for which the medial information will be used; and (C) describes the restrictions on the disclosure of the employee’s medical information, the employer representatives or other parties with whom the information will be shared, and the methods that the covered entity will use to ensure that medical information is not improperly disclosed (including whether it complies with the measures set forth in the HIPAA regulations).”
After much debate, the EEOC declined to include a requirement that employees participating in EHPs provide prior written and knowing confirmation that their participation is voluntary. In making its determination, the EEOC sought to ensure that no employee unwittingly authorized the dissemination of confidential and protected information, while refusing to place unwieldy burdens on an employer. In order to balance those competing interests, the EEOC ruled that “a covered entity may not require an employee to agree to the sale, exchange, sharing, transfer, or other disclosure of medical information, or to waive confidentially protections available under the ADA as a condition for participating in a wellness program or receiving a wellness program incentive.”
The EEOC rules go into effect on the first day of the first plan year for benefits beginning on or after January 1, 2017. With open enrollments quickly approaching, it is important for employers to make sure they are familiar with the new EEOC rules. Employers can expect the EEOC and employee groups to enforce compliance with the new notice rules through litigation.
Employers also must understand that this is just one of the rules that govern EHPs. Implementation of these programs requires compliance with a host of laws and regulations, including but not limited to: HIPAA, Title II of GINA (also enforced by the EEOC), the Affordable Care Act and others.
*Patrick J. Hoban practices in all areas of employment and labor law. If you have questions about employee health programs or other employment and labor law issues, please contact Pat (pjh@zrlaw.com) at 216.696.4441.
Religious Discrimination on the Horizon: EEOC Targets Enforcement
In a series of moves, the Equal Employment Opportunity Commission (“EEOC”) recently demonstrated its intent to pursue religious discrimination claims more actively. In July, the EEOC released a fact sheet “designed to help younger workers understand their rights and responsibilities” under anti-discrimination laws. The EEOC also announced its improved coordination with the Department of Labor (“DOL”) to prevent religious discrimination among federal contractors and subcontractors.Title VII of the Civil Rights Act of 1964 (“Title VII”) forbids religious discrimination. Specifically, the statute’s “disparate treatment” provision prohibits employers from failing/refusing to hire, discharging, or otherwise discriminating against an applicant/employee “because of” the applicant’s/employee’s religion. Title VII defines religion to include all aspects of religious observance, practice, and belief.
Religious disparate treatment claims often arise in the form of “failure to accommodate” allegations. Generally, to succeed on a failure to accommodate claim, the applicant/employee initially must prove that: (1) he/she holds a sincere religious belief that conflicts with a job requirement; (2) he/she informed the employer about the conflict; and (3) the employer discharged or disciplined the applicant/employee for failing to comply with the conflicting job requirement.
Title VII defines religious belief broadly. For example, one court acknowledged that Title VII provides atheists with the same protections as members of other religions and found a plaintiff’s atheistic beliefs sincere. See Mathis v. Christian Heating and Air Conditioning, Inc., 158 F. Supp. 3d 317 (E.D. Pa. 2016). There, the plaintiff’s atheistic beliefs conflicted with a job requirement to wear an I.D. badge that included a religious mission statement.
The United States Supreme Court recently relieved applicants/employees from demonstrating, in some cases, that the applicant/employee informed the employer of a conflict between the job requirement and religious belief. In EEOC v. Abercrombie & Fitch Stores, Inc., 135 S. Ct. 2028 (2015), the Court held the employer does not need specific knowledge of the applicant’s/employee’s religion or need for accommodation in intentional religious discrimination cases. Rather, an employer who acts with the motive to avoid an applicant’s/employee’s religious practice or need for religious accommodation – even if based on nothing more than an unsubstantiated suspicion – may violate Title VII. An applicant’s/employee’s religion cannot be a “motivating factor” in the employer’s decision.
If an applicant/employee establishes a prima facie failure to accommodate claim, the employer must show that accommodating the employee would impose an undue hardship on the employer. Undue hardship means more than a de minimis cost. Historically, courts have considered accommodations that result in the following undue hardships: requiring an employer to pay overtime; requiring an employer to hire replacement employees; requiring an employer to make additional contributions to insurance and pension funds; requiring an employer to take action that compromises schedule or seniority systems; and requiring an employer to risk regulatory or criminal sanctions.
In addition, Title VII mandates that an employee cooperate with the employer’s attempts to provide a religious accommodation. Courts may be more likely to find undue hardship where the employee refuses to compromise. For example, a FedEx employee insisted that she keep her operations manager position and get all Saturdays off. The company showed such arrangement would have created a safety risk because the company needed all managers available every day during peak season to assist in loading and launching aircraft. The court found that allowing the employee not to work during peak season imposed an undue hardship. See Burdette v. Federal Express Corp., 367 Fed. App’x 628 (6th Cir. 2010).
Employers should address claims of religious discrimination and requests for accommodation carefully and on an individualized basis. In its Abercrombie & Fitch decision, the United States Supreme Court concluded Title VII does not demand mere neutrality with regard to religious practices. Rather, “it gives [employees seeking religious accommodations] favored treatment.” When evaluating accommodation requests, employers should evaluate carefully the costs of an accommodation, work with the employee to find a solution, and contact employment counsel with questions.
*Drew C. Piersall practices in all areas of employment and labor law. If you have questions about religious discrimination, accommodations, or the EEOC’s enforcement efforts, please contact Drew (dcp@zrlaw.com) at 614.224.4411.
Z&R SHORTS
Please join Z&R in welcoming Scott DeHart to its Employment and Labor Groups
Scott DeHart’s practice will focus on all areas of private and public sector labor and employment law and litigation. Scott graduated summa cum laude from New York Law School, where he focused his studies on labor and employment law. As a law student, Scott was selected as Champion of the NKU Grosse Moot Court Competition. Prior to joining Zashin & Rich, Scott pursued a career as a Human Resources practitioner, most recently as a Director of Human Resources at Columbia University. In that capacity, Scott ensured the effective design and administration of a broad range of HR programs and served on the university’s collective bargaining team.
Upcoming Speaking Engagements
Monday, November 7, 2016
George S. Crisci presents “The National Labor Relations Board – Obligations and Compliance” and “Other Employment Laws You Need to Know” at the National Business Institute’s Seminar on Human Resource Law from Start to Finish at the CMBA Conference Center, One Cleveland Center, 1375 E 9th St, Cleveland, Ohio 44114.
Friday, November 18, 2016
Jonathan J. Downes presents “FLSA – New Rules and Practical Solutions” at the CAAO Winter Conference during the 9:00 am – 10:30 am session. The conference takes place at the Embassy Suites Dublin, 5100 Upper Metro Place, Dublin, 43017.
Thursday, December 8, 2016
George S. Crisci will participate, as the Management Panelist, in the presentation “A View from the Chair of the National Labor Relations Board.” The featured panelist will be NLRB Chairman Mark G. Pearce. Patrick J. Hoban will participate, as the Management Panelist, in the presentation “Applying the NLRA to Employer Handbooks and Other Employer Policies.” The presentations will occur at 12:30 p.m. and 1:45 p.m., as part of the Ohio State Bar Association’s “National Labor Relations Board Update: Times and Laws are Changing” seminar, which will be held at the Ohio State Bar Association headquarters, 1700 Lake Shore Drive, Columbus, Ohio 43204.
For more information regarding this seminar, please contact Linda Morris – CLE Program Coordinator for the Ohio State Bar Association at 614-487-4408 or email at lmorris@ohiobar.org.
Monday, September 26, 2016
21 States, Including Ohio, File Lawsuit Challenging the DOL’s Final Rule Increasing the Minimum Salary Threshold Under the FLSA
By Michele L. Jakubs*
On September 20, 2016, 21 states, including Ohio, filed a lawsuit, State of Nevada, et al. v. U.S. Dept. of Labor, et al., 1:16-cv-00407 (E.D., Texas 2016), in federal court, challenging the final rule recently implemented by the Department of Labor (DOL) increasing the minimum salary threshold required to qualify for the Fair Labor Standards Act's (“FLSA”) “white collar” overtime exemptions. The rule is set to take effect on December 1, 2016 and will increase the minimum salary threshold from $23,660 per year to $47,476 per year. Z&R previously reported on the scope of the changes.
The States seek a declaratory judgment from the Court holding that, among other things: (1) the final rule is unlawful under the Constitution; (2) the final rule’s automatic indexing of the salary-basis test every three years is without Constitutional authority and violates the Administrative Procedure Act; and, (3) the final rule is unconstitutional as applied to the States. The States also have asked the Court to issue an injunction enjoining the final rule from having any legal effect.
While employers should continue to prepare for the December 1, 2016 implementation of the final rule, it is possible that the Court may issue an order staying the effective date of the final rule pending resolution of the legal challenges advanced by the 21 states. Z&R will continue to monitor this case and will issue further client alerts as the case advances.
*Michele L. Jakubs, an OSBA Certified Specialist in Labor and Employment Law, has extensive experience defending employers in FLSA actions and is well versed in the nuances of the law. If you have questions about the DOL’s final rule or the FLSA more generally, please contact Michele (mlj@zrlaw.com) at 216.696.4441.
On September 20, 2016, 21 states, including Ohio, filed a lawsuit, State of Nevada, et al. v. U.S. Dept. of Labor, et al., 1:16-cv-00407 (E.D., Texas 2016), in federal court, challenging the final rule recently implemented by the Department of Labor (DOL) increasing the minimum salary threshold required to qualify for the Fair Labor Standards Act's (“FLSA”) “white collar” overtime exemptions. The rule is set to take effect on December 1, 2016 and will increase the minimum salary threshold from $23,660 per year to $47,476 per year. Z&R previously reported on the scope of the changes.
The States seek a declaratory judgment from the Court holding that, among other things: (1) the final rule is unlawful under the Constitution; (2) the final rule’s automatic indexing of the salary-basis test every three years is without Constitutional authority and violates the Administrative Procedure Act; and, (3) the final rule is unconstitutional as applied to the States. The States also have asked the Court to issue an injunction enjoining the final rule from having any legal effect.
While employers should continue to prepare for the December 1, 2016 implementation of the final rule, it is possible that the Court may issue an order staying the effective date of the final rule pending resolution of the legal challenges advanced by the 21 states. Z&R will continue to monitor this case and will issue further client alerts as the case advances.
*Michele L. Jakubs, an OSBA Certified Specialist in Labor and Employment Law, has extensive experience defending employers in FLSA actions and is well versed in the nuances of the law. If you have questions about the DOL’s final rule or the FLSA more generally, please contact Michele (mlj@zrlaw.com) at 216.696.4441.
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.
Wednesday, July 27, 2016
Ohio Supreme Court Recognizes Workers’ Compensation Retaliation Claims Even Absent Non-Compensable Injuries
*By Scott Coghlan
On July 21, 2016, the Ohio Supreme Court held that an employee can assert a viable workers’ compensation retaliation claim in the absence of proof of an actual workplace injury. Onderko v. Sierra Lobo, Inc., 2016-Ohio-5027. The decision resolved a split among Ohio’s appellate courts and conclusively establishes that Ohio employers may be liable for retaliation under the workers’ compensation law even in cases where the underlying workers’ compensation claim is denied.
The plaintiff in Onderko left work early after experiencing pain in his knee. On the way home, the plaintiff’s knee gave out as he stepped off a curb at a gas station. Upon seeking medical attention, the plaintiff only informed his doctor about the gas station incident and not the pain he felt while at work. Plaintiff alleged he did not mention the pain at work due to concerns he would be fired by his employer. The plaintiff subsequently filed a claim with the Ohio Bureau of Workers’ Compensation (“BWC”), claiming he injured his knee at work. Eventually, a hearing officer denied the claim and the plaintiff did not appeal the denial. Shortly thereafter, the employer fired the plaintiff “for his ‘deceptive’ attempt to obtain workers’ compensation benefits for a non‑work-related injury.” The plaintiff filed suit against the employer, asserting a claim under Ohio Revised Code 4123.90, which prohibits employers from terminating or taking punitive action against employees for filing claims with the BWC “for an injury or occupational disease which occurred in the course of and arising out of [the employee’s] employment with that employer.”
Seeking to have the claim dismissed, the employer in Onderko argued that, to state a viable claim under R.C. 4123.90, the plaintiff must prove that the underlying BWC claim involved an actual work-related injury. The employer also argued the plaintiff could not relitigate the issue of whether he suffered a workplace injury, based upon the un-appealed decision of the hearing officer denying his BWC claim. The trial court agreed with the employer, but the Sixth District Court of Appeals reversed.
On appeal, the Ohio Supreme Court held “the elements of a prima facie case of retaliatory discharge under the statute do not require the plaintiff to prove that the injury occurred on the job.” Furthermore, “[b]ecause proof of a work-related injury is not an element of a prima facie case of retaliatory discharge, failure to appeal the denial of a workers’ compensation claim does not foreclose a claim for retaliatory discharge.” The Court explained that the “language of the statute hinges on the employer’s response to the plaintiff’s pursuit of benefits, not the award of benefits.” Conditioning a retaliation claim upon the successful assertion of a BWC claim would miss “the point of the statute, which is to enable employees to freely exercise their rights without fear of retribution from employers.”
The Court also addressed employer concerns relating to fraudulent BWC claims. The Court noted that filing a false claim or making misleading statements to secure workers’ compensation is a crime and grounds for termination. However, the Court “resist[ed] interpreting the antiretaliation statute in such a way that would vest employers with the discretion to label any unsuccessful claim as deceptive and then terminate the employee.”
Accordingly, Ohio employers should be aware that they may be subject to a retaliation claim for taking adverse action against an employee who has filed a workers’ compensation claim, even if that claim is disallowed. If an employer believes an employee has filed a fraudulent BWC claim, they should contact counsel and conduct a thorough investigation prior to taking any adverse action that is premised upon the filing of a BWC claim.
*Scott Coghlan chairs the firm’s Workers’ Compensation Group. For more information about this decision, or workers’ compensation law in general, please contact Scott (sc@zrlaw.com) at 216.696.4441.
On July 21, 2016, the Ohio Supreme Court held that an employee can assert a viable workers’ compensation retaliation claim in the absence of proof of an actual workplace injury. Onderko v. Sierra Lobo, Inc., 2016-Ohio-5027. The decision resolved a split among Ohio’s appellate courts and conclusively establishes that Ohio employers may be liable for retaliation under the workers’ compensation law even in cases where the underlying workers’ compensation claim is denied.
The plaintiff in Onderko left work early after experiencing pain in his knee. On the way home, the plaintiff’s knee gave out as he stepped off a curb at a gas station. Upon seeking medical attention, the plaintiff only informed his doctor about the gas station incident and not the pain he felt while at work. Plaintiff alleged he did not mention the pain at work due to concerns he would be fired by his employer. The plaintiff subsequently filed a claim with the Ohio Bureau of Workers’ Compensation (“BWC”), claiming he injured his knee at work. Eventually, a hearing officer denied the claim and the plaintiff did not appeal the denial. Shortly thereafter, the employer fired the plaintiff “for his ‘deceptive’ attempt to obtain workers’ compensation benefits for a non‑work-related injury.” The plaintiff filed suit against the employer, asserting a claim under Ohio Revised Code 4123.90, which prohibits employers from terminating or taking punitive action against employees for filing claims with the BWC “for an injury or occupational disease which occurred in the course of and arising out of [the employee’s] employment with that employer.”
Seeking to have the claim dismissed, the employer in Onderko argued that, to state a viable claim under R.C. 4123.90, the plaintiff must prove that the underlying BWC claim involved an actual work-related injury. The employer also argued the plaintiff could not relitigate the issue of whether he suffered a workplace injury, based upon the un-appealed decision of the hearing officer denying his BWC claim. The trial court agreed with the employer, but the Sixth District Court of Appeals reversed.
On appeal, the Ohio Supreme Court held “the elements of a prima facie case of retaliatory discharge under the statute do not require the plaintiff to prove that the injury occurred on the job.” Furthermore, “[b]ecause proof of a work-related injury is not an element of a prima facie case of retaliatory discharge, failure to appeal the denial of a workers’ compensation claim does not foreclose a claim for retaliatory discharge.” The Court explained that the “language of the statute hinges on the employer’s response to the plaintiff’s pursuit of benefits, not the award of benefits.” Conditioning a retaliation claim upon the successful assertion of a BWC claim would miss “the point of the statute, which is to enable employees to freely exercise their rights without fear of retribution from employers.”
The Court also addressed employer concerns relating to fraudulent BWC claims. The Court noted that filing a false claim or making misleading statements to secure workers’ compensation is a crime and grounds for termination. However, the Court “resist[ed] interpreting the antiretaliation statute in such a way that would vest employers with the discretion to label any unsuccessful claim as deceptive and then terminate the employee.”
Accordingly, Ohio employers should be aware that they may be subject to a retaliation claim for taking adverse action against an employee who has filed a workers’ compensation claim, even if that claim is disallowed. If an employer believes an employee has filed a fraudulent BWC claim, they should contact counsel and conduct a thorough investigation prior to taking any adverse action that is premised upon the filing of a BWC claim.
*Scott Coghlan chairs the firm’s Workers’ Compensation Group. For more information about this decision, or workers’ compensation law in general, please contact Scott (sc@zrlaw.com) at 216.696.4441.
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