Wednesday, July 17, 2019
Attention EEO-1 Filers: The EEOC Opened its Online-Filing System for “Component 2 Data” and Filings Are Due by September 30, 2019
It’s “go” time, EEO-1 filers. On July 15, 2019, the U.S. Equal Employment Opportunity Commission (“EEOC”) announced that it has opened its long-awaited online-filing system to capture 2017 and 2018 “Component 2 Data” for the revised Employer Information Report, commonly known as the EEO-1 form. The new Component 2 Data will track an employee’s general compensation and work hours, correlated to the employee’s race/ethnicity, gender, and job category. While the EEOC has tracked employees' race/ethnicity, gender, and job-category data since 1966, this is the first time the EEOC will track pay and work-hours data.
As previously reported by Z&R, the EEOC requires certain “covered employers” to file EEO-1 forms annually. Covered employers who filed a non-pay-related EEO-1 form for 2017 or 2018 must supplement such filings with relevant Component 2 Data by September 30, 2019, via the EEOC’s online portal. On July 15, 2019, the EEOC sent portal-log-in information to covered employees by USPS letter and email.
Employers should contact counsel with any questions about submitting the new Component 2 Data.
*Jzinae N. Jackson practices in all areas of labor and employment law. If you have questions regarding the EEO-1 form, please contact Jzinae (jnjzrlaw.com) at (216) 696-4441.
Thursday, May 23, 2019
EMPLOYMENT LAW QUARTERLY | Volume XXI, Issue ii
Download PDF
The Ohio Civil Rights Commission’s (“OCRC”) 2018 annual report revealed the number of discrimination complaints (aka Charges of Discrimination) before the OCRC increased by 4.4 percent from the previous year. This report covers the fiscal year from July 1, 2017 to June 30, 2018. In this time period, individuals filed 6,098 charges with the OCRC compared to 5,840 charges filed the previous fiscal year. Of these, the OCRC closed 3,674 cases. Notably, investigators found no probable cause in 2,181. The OCRC closed the remaining 1,493 cases for a number of other reasons, including party settlement, complainants’ withdrawal of their charges, and failure of complainants to return their notarized Charge of Discrimination.
Race discrimination claims account for the largest number of charges followed by retaliation, disability, and sex, respectively – all of which increased from the previous year. An OCRC representative explained that, while they can make educated guesses when looking at data over a decade, it is difficult to understand changes in filings and closures from year-to-year. For example, employment discrimination complaints can increase during recessions due to economic factors influencing employees’ work environments. However, it is much more difficult to analyze trends when “it’s so fresh.”
Given this recent increase in discrimination complaints, it is important that employers ensure their supervisors and employees receive effective training to prevent workplace discrimination, retaliation, and other illegal conduct. The attorneys at Zashin & Rich regularly provide workplace training. Employers also should consult with counsel to assess whether their workplace policies and procedures provide them sufficient protection.
*Lisa A. Kainec, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law. If you have questions regarding responding to a Charge of Discrimination, please contact Lisa (lak@zrlaw.com) at (216) 696-4441.
On April 24, 2019, the U.S. Supreme Court held an ambiguous arbitration agreement could not mean that the parties agreed to class arbitration. In doing so, the Court held that shifting from individual to class arbitration is a fundamental change that sacrifices the principal advantage of arbitration and greatly increases risks to defendants. See Lamps Plus, Inc. v. Varela, No. 17-988, 203 L. Ed. 636, 2019 U.S. LEXIS 2943 (Apr. 24, 2019). The Supreme Court overturned the Ninth Circuit’s decision compelling an employer to arbitrate claims on a classwide rather than an individual basis. Because of the Supreme Court’s decision, employees may not seek class arbitration unless the arbitration agreement explicitly authorizes class arbitration. This is a major win for employers but also a cautionary tale regarding the importance of ensuring that arbitration agreements clearly and completely express the intent of the parties.
In Lamps Plus, a hacker gained access to information of approximately 1,300 employees. After one employee learned about a fraudulent income tax return filed in his name, he filed a class action against his employer due to the data breach. Relying on an arbitration agreement, the employer sought arbitration on an individual rather than a classwide basis. The arbitration agreement provided: “arbitration shall be in lieu of any and all lawsuits or other civil legal proceedings relating to my employment.” The District Court rejected the employer’s request for individual arbitration and authorized class arbitration. The Ninth Circuit affirmed the District Court’s ruling on the basis of state contract law, which provides any ambiguity in a contract should be construed against the drafter. However, the Supreme Court found this rule unavailing.
The Supreme Court’s decision to overrule class arbitration aligns with prior cases involving class arbitration. See Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612 (2018) (holding mandatory employment arbitration agreements that require employees to waive the right to class litigation do not violate the National Labor Relations Act); AT&T Mobility LLC v. Concepcion, 563 U. S. 333 (2011) (finding class arbitration sacrifices arbitration’s informality and convenience); Stolt-Nielsen S. A. v. AnimalFeeds Int’l Corp., 559 U. S. 662 (2010) (holding parties may not compel class arbitration when an agreement is silent on the matter).
Emphasizing the difference between individual and class arbitration, the Supreme Court described the need for strict consent to class arbitration and giving effect to the parties’ intent. The Supreme Court explained class arbitration makes the process slower, more costly, introduces new risks and costs, and raises due process concerns by deciding absent class members’ rights. On the other hand, individual arbitration allows parties to avoid litigation with the speed, simplicity, and inexpensiveness of arbitration. The Supreme Court further noted that these crucial differences are the “reason to doubt the parties’ mutual consent to resolve disputes through classwide arbitration.”
In light of very favorable decisions from the Supreme Court, employers should consider whether to implement mandatory arbitration programs. Any such program should clearly communicate the exclusion of class arbitration. Employers with an arbitration agreement currently in place should review those agreements to verify that the agreements explicitly express their intent as to class action claims.
*Stephen S. Zashin, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law and is the head of the firm’s Employment and Labor Groups. Stephen has drafted and litigated the enforcement of arbitration agreements for over 20 years. If you have questions regarding developing an arbitration program, class arbitration, or any other arbitration issues, please contact Stephen (ssz@zrlaw.com) at (216) 696-4441.
On March 13, 2019, the City of Cincinnati passed Ordinance No. 83-2019, which generally prohibits Cincinnati employers with at least fifteen employees from seeking an applicant’s prior salary information. Cincinnati joins a growing number of states and municipalities that have enacted similar bans. Accordingly, Cincinnati employers should determine whether they are subject to the law and, if so, implement necessary changes to existing practices to ensure compliance when it becomes effective on March 13, 2020.
Essentially, effective March 13, 2020, Cincinnati employers will be unable to seek, use, or otherwise rely upon an applicant’s salary history during the hiring process. Notably, the ordinance also requires an employer, “upon reasonable request,” to provide an applicant the pay scale applicable to the position for which the applicant is applying once the employer has made an offer of employment. However, the ordinance makes no reference to inquiring into an applicant’s salary expectations. Regardless, this ordinance will have a significant impact on the typical hiring and salary negotiation process.
*Drew C. Piersall, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law. If you have questions about this ordinance or inquiries into an applicant’s salary history, please contact Drew (dcp@zrlaw.com) at (614) 224-4411.
The U.S. Equal Employment Opportunity Commission (“EEOC”) requires certain private employers (see below) to report demographic information about their workforces on an Employer Information Report, commonly referred to as an EEO-1 form. Following a revision to the EEO-1, employers now must report employee compensation, categorized by sex, race, ethnicity, and other demographics. Covered employers must provide this pay-related information for calendar years 2017 and 2018 to the EEOC by September 30, 2019.
In early 2016, the EEOC announced the revised EEO-1 form with the pay-data requirements. A detailed discussion of the revised EEO-1 form can be found here. After initially approving the new EEO-1 form, the Office of Management and Budget (“OMB”) announced a stay and review of the revised EEO-1 form. However, on March 4, 2019, a federal court vacated the OMB’s stay and reinstated the revised EEO-1 form, including the new pay-data requirements.
The following types of employers must complete and submit the revised EEO-1 form:
*Jzinae N. Jackson practices in all areas of labor and employment law. If you have questions regarding the EEO-1 form, please contact Jzinae (jnj@zrlaw.com) at (216) 696-4441.
Jzinae Jackson’s practice encompasses all areas of labor and employment law. Jzinae graduated cum laude from Capital University. She earned her law degree from Cleveland Marshall College of Law, where she was selected as the Dean’s Learn Law. Live Justice. Award Recipient. As a law student, Jzinae participated in an externship with Cleveland Marshall’s Civil Litigation Clinic, where she advised clients on civil protection orders and unemployment claims, and counseled consumers and businesses through the dispute resolution process. Outside the clinic, Jzinae was a member of Cleveland Marshall’s Trial Advocacy Team, where she competed in a number of competitions. Independently, Jzinae competed in the 2017 Ohio Attorney General’s Public Service Mock Trial Competition, where she was awarded Best Advocate. Additionally, she served as the 2017 Midwest Regional Director of Thurgood Marshall Mock Trial Competition of the National Black Law Students Association.
Tuesday, June 4, 2019
Jonathan J. Downes presents “Collective Bargaining for Public Employers” at the Ohio Association of Chiefs of Police meeting at the Hilliard Police Department Training Facility in Hilliard, Ohio.
Thursday, June 6, 2019
Jonathan J. Downes presents at the SERB Advanced Negotiations Seminar at State Library in Columbus, Ohio.
Friday, June 14, 2019
George S. Crisci presents “Independent Worker: A Legal Concept Whose Time Has Come?” at the 71st Annual Meeting of the Labor and Employment Relations Association (LERA) at the Westin Cleveland Downtown in Cleveland, Ohio.
Friday, June 21, 2019
Scott H. DeHart presents “FLSA Legal Update” at the Ohio Public Employer Labor Relations Association’s (OHPELRA) Summer Workshop at the Liberty Center in Lancaster, Ohio.
- Ohio Employment Discrimination Complaints on the Rise
- Say What You Mean and Mean What You Say: U.S. Supreme Court Rejects Class Arbitration in Ambiguous Agreement
- City of Cincinnati Passes Salary History Ban
- Not Enough Time? Federal Court Reinstates EEO-1 Pay Data Requirements with a September 30, 2019 Deadline
- Z&R SHORTS
Ohio Employment Discrimination Complaints on the Rise
By Lisa A. Kainec*The Ohio Civil Rights Commission’s (“OCRC”) 2018 annual report revealed the number of discrimination complaints (aka Charges of Discrimination) before the OCRC increased by 4.4 percent from the previous year. This report covers the fiscal year from July 1, 2017 to June 30, 2018. In this time period, individuals filed 6,098 charges with the OCRC compared to 5,840 charges filed the previous fiscal year. Of these, the OCRC closed 3,674 cases. Notably, investigators found no probable cause in 2,181. The OCRC closed the remaining 1,493 cases for a number of other reasons, including party settlement, complainants’ withdrawal of their charges, and failure of complainants to return their notarized Charge of Discrimination.
Race discrimination claims account for the largest number of charges followed by retaliation, disability, and sex, respectively – all of which increased from the previous year. An OCRC representative explained that, while they can make educated guesses when looking at data over a decade, it is difficult to understand changes in filings and closures from year-to-year. For example, employment discrimination complaints can increase during recessions due to economic factors influencing employees’ work environments. However, it is much more difficult to analyze trends when “it’s so fresh.”
Given this recent increase in discrimination complaints, it is important that employers ensure their supervisors and employees receive effective training to prevent workplace discrimination, retaliation, and other illegal conduct. The attorneys at Zashin & Rich regularly provide workplace training. Employers also should consult with counsel to assess whether their workplace policies and procedures provide them sufficient protection.
*Lisa A. Kainec, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law. If you have questions regarding responding to a Charge of Discrimination, please contact Lisa (lak@zrlaw.com) at (216) 696-4441.
Say What You Mean and Mean What You Say: U.S. Supreme Court Rejects Class Arbitration in Ambiguous Agreement
By Stephen S. Zashin*On April 24, 2019, the U.S. Supreme Court held an ambiguous arbitration agreement could not mean that the parties agreed to class arbitration. In doing so, the Court held that shifting from individual to class arbitration is a fundamental change that sacrifices the principal advantage of arbitration and greatly increases risks to defendants. See Lamps Plus, Inc. v. Varela, No. 17-988, 203 L. Ed. 636, 2019 U.S. LEXIS 2943 (Apr. 24, 2019). The Supreme Court overturned the Ninth Circuit’s decision compelling an employer to arbitrate claims on a classwide rather than an individual basis. Because of the Supreme Court’s decision, employees may not seek class arbitration unless the arbitration agreement explicitly authorizes class arbitration. This is a major win for employers but also a cautionary tale regarding the importance of ensuring that arbitration agreements clearly and completely express the intent of the parties.
In Lamps Plus, a hacker gained access to information of approximately 1,300 employees. After one employee learned about a fraudulent income tax return filed in his name, he filed a class action against his employer due to the data breach. Relying on an arbitration agreement, the employer sought arbitration on an individual rather than a classwide basis. The arbitration agreement provided: “arbitration shall be in lieu of any and all lawsuits or other civil legal proceedings relating to my employment.” The District Court rejected the employer’s request for individual arbitration and authorized class arbitration. The Ninth Circuit affirmed the District Court’s ruling on the basis of state contract law, which provides any ambiguity in a contract should be construed against the drafter. However, the Supreme Court found this rule unavailing.
The Supreme Court’s decision to overrule class arbitration aligns with prior cases involving class arbitration. See Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612 (2018) (holding mandatory employment arbitration agreements that require employees to waive the right to class litigation do not violate the National Labor Relations Act); AT&T Mobility LLC v. Concepcion, 563 U. S. 333 (2011) (finding class arbitration sacrifices arbitration’s informality and convenience); Stolt-Nielsen S. A. v. AnimalFeeds Int’l Corp., 559 U. S. 662 (2010) (holding parties may not compel class arbitration when an agreement is silent on the matter).
Emphasizing the difference between individual and class arbitration, the Supreme Court described the need for strict consent to class arbitration and giving effect to the parties’ intent. The Supreme Court explained class arbitration makes the process slower, more costly, introduces new risks and costs, and raises due process concerns by deciding absent class members’ rights. On the other hand, individual arbitration allows parties to avoid litigation with the speed, simplicity, and inexpensiveness of arbitration. The Supreme Court further noted that these crucial differences are the “reason to doubt the parties’ mutual consent to resolve disputes through classwide arbitration.”
In light of very favorable decisions from the Supreme Court, employers should consider whether to implement mandatory arbitration programs. Any such program should clearly communicate the exclusion of class arbitration. Employers with an arbitration agreement currently in place should review those agreements to verify that the agreements explicitly express their intent as to class action claims.
*Stephen S. Zashin, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law and is the head of the firm’s Employment and Labor Groups. Stephen has drafted and litigated the enforcement of arbitration agreements for over 20 years. If you have questions regarding developing an arbitration program, class arbitration, or any other arbitration issues, please contact Stephen (ssz@zrlaw.com) at (216) 696-4441.
City of Cincinnati Passes Salary History Ban
By Drew C. Piersall*On March 13, 2019, the City of Cincinnati passed Ordinance No. 83-2019, which generally prohibits Cincinnati employers with at least fifteen employees from seeking an applicant’s prior salary information. Cincinnati joins a growing number of states and municipalities that have enacted similar bans. Accordingly, Cincinnati employers should determine whether they are subject to the law and, if so, implement necessary changes to existing practices to ensure compliance when it becomes effective on March 13, 2020.
“Prohibited Salary History Inquiry and Use”
The ordinance specifically prohibits employers from undertaking any of the following actions:(1) Inquiring about the salary history of an applicant for employment;See Ord. 804-03(a)(1)-(4).
(2) Screening job applicants based on their current or prior wages, benefits, other compensation, or salary histories, including requiring that an applicant’s prior wages, benefits, other compensation or salary history satisfy minimum or maximum criteria;
(3) Relying on the salary history of an applicant in deciding whether to offer employment to an applicant, or in determining the salary, benefits, or other compensation for such applicant during the hiring process, including the negotiation of an employment contract; or
(4) Refusing to hire or otherwise disfavoring, injuring, or retaliating against an applicant for not disclosing his or her salary history to an employer.
Essentially, effective March 13, 2020, Cincinnati employers will be unable to seek, use, or otherwise rely upon an applicant’s salary history during the hiring process. Notably, the ordinance also requires an employer, “upon reasonable request,” to provide an applicant the pay scale applicable to the position for which the applicant is applying once the employer has made an offer of employment. However, the ordinance makes no reference to inquiring into an applicant’s salary expectations. Regardless, this ordinance will have a significant impact on the typical hiring and salary negotiation process.
Exceptions to the Ordinance
The ordinance includes various exceptions that may apply to permit an employer to seek, use, or otherwise rely upon an applicant’s salary history during the hiring process. See Ord. 804-03(d)(1)-(8). For example, the ordinance does not apply to internal transfers and promotions, an applicant’s voluntary disclosure of salary history, “salary, benefits, or other compensation... determined pursuant to procedures established by collective bargaining,” and certain other limited circumstances.Remedies and Statute of Limitations
In the event the ordinance is violated, the applicant can enforce the ordinance and seek “compensatory damages, reasonable attorney’s fees, the costs of the action, and such legal and equitable relief as the court deems just and proper.” A plaintiff must initiate such action within two years.Conclusion
Cincinnati has joined a growing number of jurisdictions outlawing inquiry into an applicant’s salary history. Cincinnati’s new law also requires employers to provide the applicable pay scale in certain circumstances. Cincinnati employers should begin preparations and implement necessary changes to existing practices to ensure compliance with the ordinance when it becomes effective.*Drew C. Piersall, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law. If you have questions about this ordinance or inquiries into an applicant’s salary history, please contact Drew (dcp@zrlaw.com) at (614) 224-4411.
Not Enough Time? Federal Court Reinstates EEO-1 Pay Data Requirements with a September 30, 2019 Deadline
By Jzinae N. Jackson*The U.S. Equal Employment Opportunity Commission (“EEOC”) requires certain private employers (see below) to report demographic information about their workforces on an Employer Information Report, commonly referred to as an EEO-1 form. Following a revision to the EEO-1, employers now must report employee compensation, categorized by sex, race, ethnicity, and other demographics. Covered employers must provide this pay-related information for calendar years 2017 and 2018 to the EEOC by September 30, 2019.
In early 2016, the EEOC announced the revised EEO-1 form with the pay-data requirements. A detailed discussion of the revised EEO-1 form can be found here. After initially approving the new EEO-1 form, the Office of Management and Budget (“OMB”) announced a stay and review of the revised EEO-1 form. However, on March 4, 2019, a federal court vacated the OMB’s stay and reinstated the revised EEO-1 form, including the new pay-data requirements.
The following types of employers must complete and submit the revised EEO-1 form:
- Employers who are subject to Title VII of the Civil Rights Act (“Title VII”) and employ 100 or more employees;
- Employers who are subject to Title VII and employ less than 100 employees, but who are owned or affiliated with another company such that they constitute a single enterprise, and the entire enterprise employs 100 or more employees; and
- Certain federal contractors, including those with 50 or more employees and at least $50,000 in government contracts.
*Jzinae N. Jackson practices in all areas of labor and employment law. If you have questions regarding the EEO-1 form, please contact Jzinae (jnj@zrlaw.com) at (216) 696-4441.
Z&R SHORTS
Please join Z&R in welcoming Jzinae Jackson to its Employment and Labor Groups
Jzinae Jackson’s practice encompasses all areas of labor and employment law. Jzinae graduated cum laude from Capital University. She earned her law degree from Cleveland Marshall College of Law, where she was selected as the Dean’s Learn Law. Live Justice. Award Recipient. As a law student, Jzinae participated in an externship with Cleveland Marshall’s Civil Litigation Clinic, where she advised clients on civil protection orders and unemployment claims, and counseled consumers and businesses through the dispute resolution process. Outside the clinic, Jzinae was a member of Cleveland Marshall’s Trial Advocacy Team, where she competed in a number of competitions. Independently, Jzinae competed in the 2017 Ohio Attorney General’s Public Service Mock Trial Competition, where she was awarded Best Advocate. Additionally, she served as the 2017 Midwest Regional Director of Thurgood Marshall Mock Trial Competition of the National Black Law Students Association.
Upcoming Speaking Engagements
Tuesday, June 4, 2019
Jonathan J. Downes presents “Collective Bargaining for Public Employers” at the Ohio Association of Chiefs of Police meeting at the Hilliard Police Department Training Facility in Hilliard, Ohio.
Thursday, June 6, 2019
Jonathan J. Downes presents at the SERB Advanced Negotiations Seminar at State Library in Columbus, Ohio.
Friday, June 14, 2019
George S. Crisci presents “Independent Worker: A Legal Concept Whose Time Has Come?” at the 71st Annual Meeting of the Labor and Employment Relations Association (LERA) at the Westin Cleveland Downtown in Cleveland, Ohio.
Friday, June 21, 2019
Scott H. DeHart presents “FLSA Legal Update” at the Ohio Public Employer Labor Relations Association’s (OHPELRA) Summer Workshop at the Liberty Center in Lancaster, Ohio.
Thursday, February 21, 2019
EMPLOYMENT LAW QUARTERLY | Volume XXI, Issue i
Download PDF
Recently, the National Labor Relations Board (“NLRB”) published a notice of proposed rulemaking on the standard for determining joint-employer status. The proposed rule makes it less likely that a company would be deemed a joint-employer liable for labor law violations involving workers the company engages at arm’s length, such as subcontractors or franchisees. Under the NLRB’s proposed standard, an employer may be deemed a joint-employer of another employer’s employees only if it possesses and exercises “substantial, direct and immediate control” over the essential terms and conditions of the employees’ employment and has done so in a manner that is not “limited and routine.” The proposed rule is intended to avoid forcing companies, who have not exerted control over the terms and conditions of employment of other companies’ employees, to be involved in collective bargaining negotiations or defending against unfair labor practice charges with respect to those employees.
The proposed rule could be even better for employers than the pre-2015 standard because, in listing the criteria for whether a company exercises enough control to be considered a joint-employer, the proposed rule requires substantial “direct and immediate control.” The NLRB maintains that the proposed rule fosters predictability, consistency, and stability in the determination of joint-employer status.
After releasing the proposed rule, the NLRB accepted comments from the public, which it will now consider in formulating its final rule. Regardless of the final rule’s language, employers must remain cognizant of the control they exert over subcontractors, independent contractors, etc., and analyze whether it creates an employment relationship with such individuals, giving rise to related liability.
*Jessi L. Ziska practices in all areas of labor and employment law. If you have questions regarding the NLRB’s proposed joint-employer rule, please contact Jessi at jlz@zrlaw.com or 216.696.4441.
By Lauren M. Drabic*
The Fair Labor Standards Act (“FLSA”) provides wage and overtime protections for full- and part-time workers in both the private and public sectors. In particular, it establishes the federal minimum wage and generally requires covered employers to pay their employees an overtime rate at one and one-half times their regular rate of pay for hours worked over 40 in a workweek. However, the statute exempts certain employees from these minimum wage and overtime protections depending on the nature of the employee’s position, duties, and pay. The statute lists more than a dozen categories of positions that are exempt from the FLSA’s minimum wage and overtime protections. Federal regulations provide further guidance on positions that qualify as exempt.
Some FLSA provisions and related federal regulations are specific and leave little room for interpretation as to whether a certain position is exempt. For example, the FLSA specifically delineates that elementary and secondary school teachers are exempt from one or more of its protections, as are criminal investigators, police officers, firefighters, computer programmers, software engineers, cab drivers, babysitters hired on a casual basis, movie theater employees, and certain employees employed in agriculture. Federal regulations further delineate, by way of example, that doctors, lawyers, architects, and engineers typically are considered exempt employees. The applicability of other exemptions under the FLSA, however, are far from clear, even in light of additional guidance.
For nearly six decades, the Supreme Court held time and again that, when ambiguous, the provisions of the FLSA – including these exemption provisions – should be narrowly construed. In essence, this meant that unless the position at issue explicitly and irrefutably fell within the plain meaning of the FLSA’s exemption provisions – or as the Supreme Court once put it, “plainly and unmistakably [fell] within the terms or the spirit” of those provisions – such a position could not be considered exempt from the statute’s wage and overtime provisions. In practice, this meant that whenever it was unclear whether a particular position was exempt, courts were more likely to conclude it was not. This benefitted plaintiff employees bringing wage and hour claims alleging that their employers misclassified them as exempt.
In a recent decision, Encino Motorcars, LLC v. Navarro, the Supreme Court turned this longstanding precedent on its head. In Encino Motorcars, the Court interpreted the exemption under the FLSA that exempts “any salesman, partsman, or mechanic primarily engaged in selling or servicing automobiles” from its overtime provisions. The Court addressed whether car dealership service advisors – i.e., employees who consulted with customers about their automobile servicing needs and sold customers servicing solutions – fell under this exemption. The U.S. Court of Appeals for the Ninth Circuit concluded they did not. In reaching this conclusion, the Ninth Circuit applied the long-standing precedent that courts should narrowly construe the FLSA’s provisions.
The Supreme Court reversed the Ninth Circuit’s decision. After a lengthy discussion about the construction of the FLSA’s text, the Court determined that service advisors fell within the “salesman, partsman, or mechanic” exemption, despite the fact that they neither sold automobiles nor were generally responsible for servicing them. The Court reached this conclusion by determining that these employees were technically “salesmen.” Also, because these employees provided advice and sold services to customers, the Court found this technically could be interpreted to mean that they “serviced automobiles.”
One easily could argue that the Court did not base its holding on a narrow construction of the FLSA. Departing from the Court’s decades-long precedent, the Supreme Court explicitly rejected the principle of using narrow construction “as a useful guidepost for interpreting the FLSA.” Instead, the Court had “no license” to give the FLSA’s exemptions “anything but a fair reading.” With this simple statement, the FLSA’s provisions should now be interpreted “fairly” and no longer “narrowly.”
While it is too soon to say what the full impact of the Court’s Encino Motorcars decision will be, it likely will have far-reaching consequences. For the first time since the FLSA was enacted in 1938, the Supreme Court has given lower courts – and by extension, employers – license to take broader liberties in determining whether a position is exempt from the FLSA’s wage and overtime provisions.
When classifying employees, employers should still proceed with caution and err on the side of classifying positions as non-exempt, particularly when there is room for interpretation. Misclassifying an employee as exempt can result in costly litigation, including back pay for unpaid overtime wages, liquidated damages, and payment of attorneys’ fees and costs. However, the Supreme Court’s Encino Motorcars decision is a positive development for employers.
*Lauren M. Drabic works in Z&R’s Cleveland office and practices in all areas of labor and employment law. If you have questions regarding the FLSA’s wage and hour exemptions or other employment-related matters, please contact Lauren at lmd@zrlaw.com or 216.696.4441.
By Patrick M. Watts*
The Cuyahoga County Council recently enacted Ordinance No. O2018-0009, which specifically outlaws discrimination based upon sexual orientation and gender identity or expression. The ordinance also outlaws discrimination based upon “race, color, religion, military status, national origin, disability, age, ancestry, familial status, and sex.” Finally, the ordinance creates a Commission on Human Rights.
The ordinance affords the commission the power to “review, hear, decide, and enforce final decisions rendered under” the ordinance. The commission also has the power to issue subpoenas, require production of evidence, require attendance of witnesses, order preservation of evidence, assess civil administrative penalties, issue cease and desist orders, take certain actions in court to secure evidence, and generally exercise other powers “reasonable and necessary to fulfill [its] purpose.”
Complaints regarding “unlawful employment practice[s]” must be filed within 150 days after the alleged unlawful discriminatory practices or acts occurred. A response to any complaint is due within 30 days after service of any complaint. The ordinance contemplates that a hearing occur concerning the allegations contained in the complaint. Thereafter, the commission is charged with issuing a Final Decision and Order regarding whether the allegations are substantiated. To the extent the commission finds a violation, the commission can issue a cease and desist order and may issue civil penalties. Civil penalties may not exceed $5,000. The commission also may award reasonable attorneys’ fees and costs to the complainant. Any party may appeal a commission decision to the Cuyahoga County Court of Common Pleas for judicial review.
In addition to provisions relating to fair housing and public accommodations, the ordinance specifically prohibits “any employer, because of race, color, religion, military status, national origin, disability, age, ancestry, sex, sexual orientation, or gender identity or expression,” from “discharg[ing] without cause,” “refus[ing] to hire a person or otherwise…discriminat[ing] against any person with respect to hire, promotion, tenure, discharge, or any terms, conditions or privileges of employment, or any matter related to employment.”
The ordinance also outlaws certain other actions, such as publishing or circulating discriminatory notices, advertisements, or failing to “classify properly” any individual within a protected class. The ordinance prohibits employers from eliciting information concerning membership in any protected class, including sexual orientation and gender identity or expression on any application for employment, unless based upon a bona fide occupational qualification. The ordinance further prohibits retaliation against any person for opposing practices forbidden by the ordinance. The ordinance has certain exceptions, including for religious organizations.
Cuyahoga County employers should implement necessary changes to existing policies to ensure compliance with this new ordinance.
*Patrick M. Watts, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law. If you have questions about this ordinance or the Cuyahoga County Commission on Human Rights, please contact Patrick at pmw@zrlaw.com or 216.696.4441.
By Moriah L. Stutler*
At the beginning of the year, several states, including Ohio, increased their minimum wage. In Ohio, the minimum wage increased by twenty-five cents per hour to $8.55 for non-tipped employees and $4.30 for tipped employees. Ohio’s law applies to employers with gross revenue of $314,000.00 or more. Ohio employers grossing less than $314,000.00 are only required to pay the federal minimum wage, which is $7.25 per hour to non-tipped employees and $2.13 per hour to tipped employees. Additionally, Ohio employers only are required to pay minors age fifteen or younger the federal minimum wage.
Some states did not wait for the New Year to increase wages. On July 1, 2018, Maryland’s minimum wage increased to $10.10 per hour, while District of Columbia’s minimum wage increased to $13.25 per hour. On December 31, 2018, New York fast food employees saw a minimum wage increase to $12.75 per hour, and other New York employees saw an increase to $11.10 per hour. Other states will see increases later in 2019. For example, Oregon’s minimum wage will increase to $11.25 per hour on July 1, 2019.
Recently, states have been moving towards the “Living Wage” and “$15 Minimum Wage Initiative.” A number of states, including Florida, Hawaii, Maryland, Massachusetts, New Jersey, and New York have proposed bills that would increase their minimum wage to approximately $15.00 per hour within the next five to seven years.
Employers also should be aware that some municipalities have local laws setting higher minimum wages than the state minimum wage.
*Moriah L. Stutler practices in all areas of labor and employment law. For more information about minimum wage and other wage and hour questions, please contact Moriah at mls@zrlaw.com or 216.696.4441
Alison Buzzard represents public and private sector employers in all aspects of labor and employment law. Prior to joining Zashin & Rich in 2018 at the firm's Columbus office, Alison worked as a law clerk assisting with public and private sector labor matters while she attended The Ohio State University Moritz College of Law. At Moritz, Alison served as an Associate Editor for the Ohio State Law Journal and took part in Ohio State’s moot court program, both as a member of the Governing Board and a competitor and semifinalist in the National Moot Court Competition in Child Welfare and Adoption Law.
Moriah Stutler's practice encompasses all areas of labor and employment law. Prior to joining Zashin & Rich, Moriah spent several years at a big four accounting firm in the mergers and acquisitions tax practice, where she assisted large multinational companies execute multi-million dollar acquisitions, dispositions, and other global structuring transactions. Moriah earned her law degree and MBA from The University of Akron, where she was a graduate assistant in the department of finance.
March 6, 2019
Drew C. Piersall presents “Emerging Trends in Discrimination and Retaliation Law” at the Labor and Employment Law Section meeting of the Columbus Bar Association in Columbus, Ohio.
March 7, 2019
Jonathan J. Downes presents “FMLA, ADA & Interactive Process” at the Jobs and Family Services Human Resource Association Conference 2019 at the Quest Conference Center in Columbus, Ohio.
April 5, 2019
David R. Vance will be presenting on civil claims under Ohio Revised Code 2307.60, including civil theft, at the CMBA Litigation Section’s lunch and CLE in Cleveland, Ohio.
April 24, 2019
George S. Crisci presents “Train Your Supervisors to Mitigate Lawsuits” and “Create Documentation That is a Legal Shield” at the National Business Institute’s “Why Employers Get Sued: How You Can Stop It” seminar in Maumee, Ohio.
- The NLRB Proposes New Joint-Employer Standard Limiting Employers’ Liability
- FLSA & Car Dealer Alert: What’s Fair is Fair
- Cuyahoga County Council Passes Law Protecting Sexual Orientation & Gender Identity
- New Year, New Wages: Minimum Wage Increases in Several States
- Z&R SHORTS
The NLRB Proposes New Joint-Employer Standard Limiting Employers’ Liability
By Jessi L. Ziska*Recently, the National Labor Relations Board (“NLRB”) published a notice of proposed rulemaking on the standard for determining joint-employer status. The proposed rule makes it less likely that a company would be deemed a joint-employer liable for labor law violations involving workers the company engages at arm’s length, such as subcontractors or franchisees. Under the NLRB’s proposed standard, an employer may be deemed a joint-employer of another employer’s employees only if it possesses and exercises “substantial, direct and immediate control” over the essential terms and conditions of the employees’ employment and has done so in a manner that is not “limited and routine.” The proposed rule is intended to avoid forcing companies, who have not exerted control over the terms and conditions of employment of other companies’ employees, to be involved in collective bargaining negotiations or defending against unfair labor practice charges with respect to those employees.
The Current Joint-Employer Standard
In 2015, the NLRB’s decision in Browning-Ferris Industries of California, Inc., d/b/a BFI Newby Island Recyclery, 362 NLRB No. 186 (2015) (“Browning-Ferris”) established a new joint-employer standard to replace the decades-old standard set forth in TLI, Inc., 271 NLRB 798 (1984) and Laerco Transportation, 269 NLRB 324 (1984), both now reversed by Browning-Ferris. Under the the Browning-Ferris standard, which currently controls, multiple entities are deemed a joint-employer of a single workforce if (1) “they are both employers within the meaning of the common law” and (2) they “share or co-determine” matters governing the essential terms and conditions of employment. Essentially, if an employer retains the right to control another employer’s employees — regardless of whether it actually exercises that control — this is sufficient to establish a joint-employer relationship with respect to those employees. The Browning-Ferris standard potentially exposes more companies to legal liability as joint-employers than the pre-2015 standard. Prior to Browning-Ferris, the NLRB defined a joint-employer as one who exercised “direct and immediate” control over the workers’ terms and conditions of employment. A detailed discussion of the Browning-Ferris decision and pre-2015 standard can be found here.A Move to Return to the Pre-2015 Joint-Employer Standard
The NLRB’s December 2017 decision in Hy-Brand Industrial Contractors, Ltd, 365 NLRB No. 156 (2017) (“Hy-Brand”) overruled the controversial Browning-Ferris joint-employer standard. However, the Hy-Brand case was vacated by the NLRB in February 2018 for an alleged conflict of interest due to NLRB Member Emanuel’s participation in the case, leaving employers once again subject to the Browning-Ferris standard. This hiccup did not deter the NLRB from re-establishing the pre-2015 joint-employer standard. Unable to overturn the Browning-Ferris standard through case ruling, the NLRB is engaging in rulemaking to overturn the current standard. Further, a standard issued through rulemaking is less likely to be reversed than a standard established by case ruling, since those rulings easily can be overturned if the NLRB majority flips.The proposed rule could be even better for employers than the pre-2015 standard because, in listing the criteria for whether a company exercises enough control to be considered a joint-employer, the proposed rule requires substantial “direct and immediate control.” The NLRB maintains that the proposed rule fosters predictability, consistency, and stability in the determination of joint-employer status.
After releasing the proposed rule, the NLRB accepted comments from the public, which it will now consider in formulating its final rule. Regardless of the final rule’s language, employers must remain cognizant of the control they exert over subcontractors, independent contractors, etc., and analyze whether it creates an employment relationship with such individuals, giving rise to related liability.
*Jessi L. Ziska practices in all areas of labor and employment law. If you have questions regarding the NLRB’s proposed joint-employer rule, please contact Jessi at jlz@zrlaw.com or 216.696.4441.
FLSA & Car Dealer Alert: What’s Fair is Fair
By Lauren M. Drabic*
The Fair Labor Standards Act (“FLSA”) provides wage and overtime protections for full- and part-time workers in both the private and public sectors. In particular, it establishes the federal minimum wage and generally requires covered employers to pay their employees an overtime rate at one and one-half times their regular rate of pay for hours worked over 40 in a workweek. However, the statute exempts certain employees from these minimum wage and overtime protections depending on the nature of the employee’s position, duties, and pay. The statute lists more than a dozen categories of positions that are exempt from the FLSA’s minimum wage and overtime protections. Federal regulations provide further guidance on positions that qualify as exempt.
Some FLSA provisions and related federal regulations are specific and leave little room for interpretation as to whether a certain position is exempt. For example, the FLSA specifically delineates that elementary and secondary school teachers are exempt from one or more of its protections, as are criminal investigators, police officers, firefighters, computer programmers, software engineers, cab drivers, babysitters hired on a casual basis, movie theater employees, and certain employees employed in agriculture. Federal regulations further delineate, by way of example, that doctors, lawyers, architects, and engineers typically are considered exempt employees. The applicability of other exemptions under the FLSA, however, are far from clear, even in light of additional guidance.
For nearly six decades, the Supreme Court held time and again that, when ambiguous, the provisions of the FLSA – including these exemption provisions – should be narrowly construed. In essence, this meant that unless the position at issue explicitly and irrefutably fell within the plain meaning of the FLSA’s exemption provisions – or as the Supreme Court once put it, “plainly and unmistakably [fell] within the terms or the spirit” of those provisions – such a position could not be considered exempt from the statute’s wage and overtime provisions. In practice, this meant that whenever it was unclear whether a particular position was exempt, courts were more likely to conclude it was not. This benefitted plaintiff employees bringing wage and hour claims alleging that their employers misclassified them as exempt.
In a recent decision, Encino Motorcars, LLC v. Navarro, the Supreme Court turned this longstanding precedent on its head. In Encino Motorcars, the Court interpreted the exemption under the FLSA that exempts “any salesman, partsman, or mechanic primarily engaged in selling or servicing automobiles” from its overtime provisions. The Court addressed whether car dealership service advisors – i.e., employees who consulted with customers about their automobile servicing needs and sold customers servicing solutions – fell under this exemption. The U.S. Court of Appeals for the Ninth Circuit concluded they did not. In reaching this conclusion, the Ninth Circuit applied the long-standing precedent that courts should narrowly construe the FLSA’s provisions.
The Supreme Court reversed the Ninth Circuit’s decision. After a lengthy discussion about the construction of the FLSA’s text, the Court determined that service advisors fell within the “salesman, partsman, or mechanic” exemption, despite the fact that they neither sold automobiles nor were generally responsible for servicing them. The Court reached this conclusion by determining that these employees were technically “salesmen.” Also, because these employees provided advice and sold services to customers, the Court found this technically could be interpreted to mean that they “serviced automobiles.”
One easily could argue that the Court did not base its holding on a narrow construction of the FLSA. Departing from the Court’s decades-long precedent, the Supreme Court explicitly rejected the principle of using narrow construction “as a useful guidepost for interpreting the FLSA.” Instead, the Court had “no license” to give the FLSA’s exemptions “anything but a fair reading.” With this simple statement, the FLSA’s provisions should now be interpreted “fairly” and no longer “narrowly.”
While it is too soon to say what the full impact of the Court’s Encino Motorcars decision will be, it likely will have far-reaching consequences. For the first time since the FLSA was enacted in 1938, the Supreme Court has given lower courts – and by extension, employers – license to take broader liberties in determining whether a position is exempt from the FLSA’s wage and overtime provisions.
When classifying employees, employers should still proceed with caution and err on the side of classifying positions as non-exempt, particularly when there is room for interpretation. Misclassifying an employee as exempt can result in costly litigation, including back pay for unpaid overtime wages, liquidated damages, and payment of attorneys’ fees and costs. However, the Supreme Court’s Encino Motorcars decision is a positive development for employers.
*Lauren M. Drabic works in Z&R’s Cleveland office and practices in all areas of labor and employment law. If you have questions regarding the FLSA’s wage and hour exemptions or other employment-related matters, please contact Lauren at lmd@zrlaw.com or 216.696.4441.
Cuyahoga County Council Passes Law Protecting Sexual Orientation & Gender Identity
By Patrick M. Watts*
The Cuyahoga County Council recently enacted Ordinance No. O2018-0009, which specifically outlaws discrimination based upon sexual orientation and gender identity or expression. The ordinance also outlaws discrimination based upon “race, color, religion, military status, national origin, disability, age, ancestry, familial status, and sex.” Finally, the ordinance creates a Commission on Human Rights.
Commission on Human Rights
The ordinance creates a new Commission on Human Rights that is charged with promoting “principles of diversity, inclusion, and harmony in the County of Cuyahoga.” The commission will have three members who are appointed by the County Executive and confirmed by the County Council. The ordinance requires that these members be licensed attorneys. The commission is charged with receiving, investigating, and attempting to mediate all complaints filed under the ordinance. Of note, the commission is charged with generally encouraging complainants to file a complaint with the applicable state and federal bodies, including the Ohio Civil Rights Commission and U.S. Equal Employment Opportunity Commission. The commission is authorized to decline the exercise of jurisdiction in most circumstances. However, the ordinance requires that complaints exclusively alleging discrimination based upon “sexual orientation and/or gender identity or expression… be adjudicated by the commission… without deferral” to the related state and/or federal agency.The ordinance affords the commission the power to “review, hear, decide, and enforce final decisions rendered under” the ordinance. The commission also has the power to issue subpoenas, require production of evidence, require attendance of witnesses, order preservation of evidence, assess civil administrative penalties, issue cease and desist orders, take certain actions in court to secure evidence, and generally exercise other powers “reasonable and necessary to fulfill [its] purpose.”
Complaints regarding “unlawful employment practice[s]” must be filed within 150 days after the alleged unlawful discriminatory practices or acts occurred. A response to any complaint is due within 30 days after service of any complaint. The ordinance contemplates that a hearing occur concerning the allegations contained in the complaint. Thereafter, the commission is charged with issuing a Final Decision and Order regarding whether the allegations are substantiated. To the extent the commission finds a violation, the commission can issue a cease and desist order and may issue civil penalties. Civil penalties may not exceed $5,000. The commission also may award reasonable attorneys’ fees and costs to the complainant. Any party may appeal a commission decision to the Cuyahoga County Court of Common Pleas for judicial review.
Anti-Discrimination Law and Unlawful Employment Practices under the Ordinance
In addition to existing protections for various protected classes, the ordinance specifically adds protections for sexual orientation and gender identity or expression. The ordinance defines “[g]ender identity or expression” as “an individual’s actual or perceived gender-related identity, appearance, expression, mannerisms, or other gender-related characteristics, regardless of the individual’s designated sex at birth.”In addition to provisions relating to fair housing and public accommodations, the ordinance specifically prohibits “any employer, because of race, color, religion, military status, national origin, disability, age, ancestry, sex, sexual orientation, or gender identity or expression,” from “discharg[ing] without cause,” “refus[ing] to hire a person or otherwise…discriminat[ing] against any person with respect to hire, promotion, tenure, discharge, or any terms, conditions or privileges of employment, or any matter related to employment.”
The ordinance also outlaws certain other actions, such as publishing or circulating discriminatory notices, advertisements, or failing to “classify properly” any individual within a protected class. The ordinance prohibits employers from eliciting information concerning membership in any protected class, including sexual orientation and gender identity or expression on any application for employment, unless based upon a bona fide occupational qualification. The ordinance further prohibits retaliation against any person for opposing practices forbidden by the ordinance. The ordinance has certain exceptions, including for religious organizations.
Cuyahoga County employers should implement necessary changes to existing policies to ensure compliance with this new ordinance.
*Patrick M. Watts, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law. If you have questions about this ordinance or the Cuyahoga County Commission on Human Rights, please contact Patrick at pmw@zrlaw.com or 216.696.4441.
New Year, New Wages: Minimum Wage Increases in Several States
By Moriah L. Stutler*
At the beginning of the year, several states, including Ohio, increased their minimum wage. In Ohio, the minimum wage increased by twenty-five cents per hour to $8.55 for non-tipped employees and $4.30 for tipped employees. Ohio’s law applies to employers with gross revenue of $314,000.00 or more. Ohio employers grossing less than $314,000.00 are only required to pay the federal minimum wage, which is $7.25 per hour to non-tipped employees and $2.13 per hour to tipped employees. Additionally, Ohio employers only are required to pay minors age fifteen or younger the federal minimum wage.
Some states did not wait for the New Year to increase wages. On July 1, 2018, Maryland’s minimum wage increased to $10.10 per hour, while District of Columbia’s minimum wage increased to $13.25 per hour. On December 31, 2018, New York fast food employees saw a minimum wage increase to $12.75 per hour, and other New York employees saw an increase to $11.10 per hour. Other states will see increases later in 2019. For example, Oregon’s minimum wage will increase to $11.25 per hour on July 1, 2019.
Recently, states have been moving towards the “Living Wage” and “$15 Minimum Wage Initiative.” A number of states, including Florida, Hawaii, Maryland, Massachusetts, New Jersey, and New York have proposed bills that would increase their minimum wage to approximately $15.00 per hour within the next five to seven years.
Employers also should be aware that some municipalities have local laws setting higher minimum wages than the state minimum wage.
The following table includes all increases to state minimum wages in 2019 (unless otherwise noted, all increases were effective January 1, 2019):
STATE | NON-TIPPED | TIPPED |
Alaska | $9.89 | $9.89 |
Arizona | $11.00 | $8.00 |
California | $12 for larger employers; $11 for smaller employer | $12 for larger employers; $11 for smaller employer |
Colorado | $11.10 | $8.08 |
District of Columbia (effective 7/1/2018) | $13.25 | $3.89 |
Florida | $8.46 | $5.44 |
Maine | $11.00 | $5.50 |
Maryland (effective 7/1/2018) | $10.10 | $3.63 |
Massachusetts | $12.00 | $4.35 |
Minnesota | $9.86 for larger employers; $8.04 for smaller employers | $9.86 for larger employers; $8.04 for smaller employers |
Montana | $8.50 | $8.50 |
New Jersey | $8.85 | $8.85 |
New York (effective 12/31/18) | $12.75 for fast food employees; $11.10 for other employees | $7.50 for food service employees; $9.25 for other service employees |
Ohio | $8.55 | $4.30 |
Oregon (effective 7/1/19) | $11.25 | $11.25 |
Rhode Island | $10.50 | $3.89 |
South Dakota | $9.10 | $4.55 |
Vermont | $10.78 | $5.39 |
Washington | $12.00 | $12.00 |
*Moriah L. Stutler practices in all areas of labor and employment law. For more information about minimum wage and other wage and hour questions, please contact Moriah at mls@zrlaw.com or 216.696.4441
Z&R SHORTS
Please join Z&R in welcoming Alison Buzzard and Moriah Stutler to its Employment and Labor Groups
Alison Buzzard represents public and private sector employers in all aspects of labor and employment law. Prior to joining Zashin & Rich in 2018 at the firm's Columbus office, Alison worked as a law clerk assisting with public and private sector labor matters while she attended The Ohio State University Moritz College of Law. At Moritz, Alison served as an Associate Editor for the Ohio State Law Journal and took part in Ohio State’s moot court program, both as a member of the Governing Board and a competitor and semifinalist in the National Moot Court Competition in Child Welfare and Adoption Law.
Moriah Stutler's practice encompasses all areas of labor and employment law. Prior to joining Zashin & Rich, Moriah spent several years at a big four accounting firm in the mergers and acquisitions tax practice, where she assisted large multinational companies execute multi-million dollar acquisitions, dispositions, and other global structuring transactions. Moriah earned her law degree and MBA from The University of Akron, where she was a graduate assistant in the department of finance.
Upcoming Speaking Engagements
March 6, 2019
Drew C. Piersall presents “Emerging Trends in Discrimination and Retaliation Law” at the Labor and Employment Law Section meeting of the Columbus Bar Association in Columbus, Ohio.
March 7, 2019
Jonathan J. Downes presents “FMLA, ADA & Interactive Process” at the Jobs and Family Services Human Resource Association Conference 2019 at the Quest Conference Center in Columbus, Ohio.
April 5, 2019
David R. Vance will be presenting on civil claims under Ohio Revised Code 2307.60, including civil theft, at the CMBA Litigation Section’s lunch and CLE in Cleveland, Ohio.
April 24, 2019
George S. Crisci presents “Train Your Supervisors to Mitigate Lawsuits” and “Create Documentation That is a Legal Shield” at the National Business Institute’s “Why Employers Get Sued: How You Can Stop It” seminar in Maumee, Ohio.
Tuesday, November 6, 2018
EMPLOYMENT LAW QUARTERLY | Volume XX, Issue iii
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Following years of consecutive job growth, the unemployment rate dropped to 3.7% in September. Despite the decreasing unemployment rate, labor market participation remains low. Men ages 25 to 54 currently have an 88.4% labor participation rate. According to a recent report, of those males not participating, one in five is out of the workforce because of drug addiction. Drug abuse coupled with the current economy has made the tight labor market even tighter. According to the Ohio Chamber of Commerce, one-half of Ohio businesses report suffering consequences from substance abuse.
Ohio ranks among the hardest hit states in the ongoing battle against opiate addiction. The increased use of opiates and other more-accepted drugs like marijuana combined with a tight labor market has left many employers reevaluating their hiring and drug procedures.
Ohio is taking direct action to help employers struggling with drug-use issues. Ohio’s Chamber of Commerce created an Opiate Toolkit (available here) to help employers to manage risk, prevent drug abuse, and respond to issues affecting the workplace. The toolkit contains several modules to educate employers about workplace drug policy, employee drug testing, and responding to employee drug use. The toolkit also contains an hour-long employee education course designed to help foster understanding of prescription drug abuse.
Employers understandably wish to avoid or reduce the impacts of drug abuse on their workplaces. Drug abuse affects employers by causing increased liability, productivity problems, and financial loss. In seeking to protect their interests, however, employers must ensure that their policies and practices do not conflict with the Americans with Disabilities Act (“ADA”) or related state laws.
The ADA protects qualified individuals with disabilities. The ADA’s definition of “qualified individual with a disability” specifically excludes employees and applicants who are currently engaging in the illegal use of drugs. However, the ADA does not exclude from its protection: (a) successfully rehabilitated individuals who no longer engage in the illegal use of drugs; (b) those who are currently participating in a rehabilitation program and no longer engage in the illegal use of drugs; and (c) those who are regarded by an employer, erroneously, as illegal drug users. Accordingly, employers who discriminate against these groups of individuals may face liability under the ADA and similar state laws.
For example, the Equal Employment Opportunity Commission (“EEOC”) recently filed suit against an employer that fired a recovering opioid addict who was on a methadone treatment program. According to the EEOC, on the employee’s first day of work, he took a drug test and proceeded to work the rest of the week. The next week, he learned that his test came back “positive” as a result of his prescribed methadone treatment. After the employee provided the testing laboratory with verifying information regarding his treatment, the laboratory cleared him to work. Nonetheless, the employer refused to return the employee to his position, even after he provided a letter from his doctor regarding his treatment. Based upon the employer’s refusal, the EEOC is seeking a permanent injunction barring the employer from engaging in any future disability discrimination and compensatory and punitive damages on behalf of the employee.
In the midst of the opioid crisis, employers continue to face the practical and legal impacts of drug addiction. In addition to its effect on the labor market, this crisis also has important legal implications on employers’ management of their workforces, including employees and applicants who are in recovery from opioid addiction. Employers should proceed cautiously in addressing these complicated issues and contact counsel with questions.
*Ami J. Patel, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law. For more information about workplace issues relating to opioids, the ADA, or any other employment-law questions, please contact Ami at ajp@zrlaw.com or 216.696.4441.
The Trump administration has taken a hard stance against undocumented workers. The impact of this stance is far-reaching, especially in Ohio, which recently was called the “Ground Zero” for Immigration and Customs Enforcement (“ICE”) workplace raids. Two of the country’s largest raids occurred in Ohio over the summer and resulted in over 250 arrests.
The administration’s efforts regarding undocumented and foreign labor are two-pronged – arresting and deporting undocumented workers and prosecuting violating employers. Regarding the latter, the Department of Justice (“DOJ”) recently settled claims with a landscaping company for its alleged discriminatory practices in hiring foreign workers under the H-2B visa program. The DOJ claimed that the company favored foreign labor and improperly failed to make its job postings visible to those applying in the U.S. Under the settlement agreement, the company is required to pay over $100,000 in back pay and penalties, must engage in recruitment activities to attract U.S. workers, and is subject to three years of DOJ monitoring.
While citizenship is not a requirement for employment, employees must have the necessary work authorization. USCIS requires that the worker be a member of one of four classes: U.S. citizens; noncitizen nationals; lawful permanent residents; and aliens authorized to work. An alien is any foreign citizen living in the U.S. An employer also can petition for a nonimmigrant worker to receive work authorization on a temporary basis by completing an I-129 form. Upon approval of the I-129 form, the worker must apply for admission to the U.S.
Employers must ensure they are hiring foreign workers properly without discriminating based on protected class, such as citizenship, immigration status, or national origin. Treating individuals differently based on their membership in a protected class could violate the Immigration and Nationality Act or Title VII of the Civil Rights Act, among other laws. Similarly, according to USCIS, it may be discriminatory for employers to consider future expiration dates on visas and employment authorization documents.
An employer unable to fill open positions may seek a Foreign Labor Certification from the Department of Labor. The process can take months and involves several government agencies. Several different visas and programs exist to fill persistent employment vacancies. However, the employer must verify that the open position meets the criteria set by the Department of Labor.
ICE is authorized to conduct investigations to determine whether employers knowingly employed unauthorized aliens or failed to properly complete and retain I-9 forms for newly-hired individuals. The Director of ICE has noted plans to dramatically increase the number of I-9 audits and workplace raids ICE conducts.
Employers who violate these laws can face substantial fines and criminal prosecution. Those who knowingly hire and employ workers without work authorization may be penalized from $375 to $16,000 per violation, whereas substantive and technical violations, such as failing to produce the I-9 form, can range from $110 to $1,100 per violation.
While ICE and Customs and Border Patrol cannot commandeer local law enforcement, many local agencies opt to work with the federal agencies by sharing information, conducting joint investigations, and contracting to detain arrested aliens. Immigration officers and police must have a valid warrant or an employer’s consent to enter their facilities.
Employers must take care not only to follow the various federal and state laws as they pertain to hiring foreign labor, but also must not discriminate against U.S. citizens when seeking out foreign labor. Likewise, employers must not discriminate based upon an employee’s protected class, including citizenship, immigration status, or national origin. Employers should contact counsel if they have any questions or are unsure how to navigate the complex legal landscape relating to foreign workers.
*Lauren Drabic recently joined Z&R’s Cleveland office and practices in all areas of employment law. If you have questions regarding I-9 form compliance or any other employment-related matter, please contact Lauren at lmd@zrlaw.com or 216.696.4441.
Does an employer have to pay an employee’s accrued paid time off when it discharges the employee? As one Ohio court recently explained, it depends on the terms of the employer’s policies. See Richardson v. MYCAP, 7th Dist. Mahoning No. 17 MA 0021, 2018-Ohio-2776. In MYCAP, the court granted summary judgment in favor of a group of laid-off employees, awarding them payment for accrued paid time off (“PTO”). This is the latest decision in a string of Ohio cases that look to the terms of employer policies when determining an employee’s entitlement to a payout of accrued PTO at the time of the employee’s discharge.
Finding in favor of the employees, the MYCAP Court citied to existing Ohio case law, which states “[a]lthough employee handbooks and policy manuals are not in and of themselves contracts of employment, they may define the terms and conditions of an at-will employment relationship if the employer and employee manifest an intention to be bound by them.” Accordingly, the MYCAP Court held that the employees were entitled to the PTO payments under the plain language of the handbook and that it would be unjust for the employer to retain those payments.
Accordingly, employers should address the payment of PTO upon discharge directly in their employee handbooks and policy manuals. The following is a list of tips for employers to consider when drafting or revising employee handbooks and policies addressing PTO:
Employee handbooks and employer policies are important tools for employers, and the terms set forth therein have legal implications. Employers should consult with counsel to assess whether their handbooks and policies clearly state their intentions and to ensure they are taking the proper steps to abide by them.
*Christopher Caspary works in Z&R’s Cleveland office and practices in all areas of employment law. For more information about developing employee handbooks and policies or any other employment-related matter, please contact Chris at cdc@zrlaw.com or 216.696.4441.
Although marijuana remains a Schedule I controlled substance under federal law, numerous states have legalized the use of marijuana for medical and, in eight states and the District of Columbia, recreational purposes. As Z&R previously reported, Ohio (puff, puff) passed its medical marijuana law in 2016 and set the basic framework for Ohio’s Medical Marijuana Control Program (“MMCP”). Following delays in the MMCP’s implementation process, approved cultivators have now begun growing their first crop of state-sanctioned marijuana. Based upon growing and production timeframes, estimates suggest that patients may purchase medical marijuana in Ohio as early as the end of this year.
As the smoke clears, many Ohio employers are rightfully concerned and confused about the MMCP and its potential implications for their businesses and workforces. In an apparent attempt to put employers at ease, Ohio’s General Assembly included a number of pro-employer provisions in the MMCP. Specifically, the MMCP (which is codified at Ohio Revised Code Chapter 3796) provides that:
See Ohio Revised Code 3796.28(a)(1)-(5). Furthermore, Ohio’s unemployment compensation law considers a person discharged for using marijuana “in violation of an employer’s drug-free workplace policy, zero-tolerance policy, or other formal program or policy regulating the use of medical marijuana” as discharged for “just cause.” See Ohio Revised Code 3796.28(b).
Nevertheless, even with these pro-employer provisions, Ohio employers still may face the prospect of litigation arising out of employees’ use of medical marijuana. For example, it is possible that employees may attempt to bring a disability discrimination claim under Ohio’s anti-discrimination law (Ohio Revised Code Chapter 4112), which the MMCP does not expressly reference, claiming that their rights under Ohio’s anti-discrimination law are unaffected by, and independent of, the MMCP’s pro-employer provisions.
Given the nascency of the MMCP, there currently are no court decisions addressing Ohio’s medical marijuana law in the employment context. However, courts in other states have addressed employees’ marijuana-related claims. It is important to note that medical marijuana laws vary by state and, depending on the state, may provide greater protection to employees than Ohio’s law. Still, these cases provide some insight as to how courts are addressing the issue of medical marijuana in the employment context. For example, as Z&R reported last year, the Massachusetts Supreme Judicial Court reversed the dismissal of an employee’s claim and held the employee could pursue a disability discrimination claim under Massachusetts law after her employer discharged her for testing positive for medical marijuana. See Barbuto v. Advantage Sales and Marketing, LLC, 78 N.E.3d 37 (Mass. Jul. 17, 2017).
Similarly, in September, a Federal court in Connecticut addressed a case where a nursing home rescinded a job offer to an applicant who tested positive for marijuana during a pre-employment drug screen. See Noffsinger v. SSC Niantic Operating Co., LLC, d/b/a Bride Brook Health & Rehab. Ctr., No. 3:16-cv-01938, 2018 U.S. Dist. LEXIS 150453 (D. Conn. Sept. 5, 2018). The applicant accepted an offer for a position, which was conditioned upon her completion of a drug screen. Prior to the drug screening, the applicant explained that she used medical marijuana to treat her post-traumatic stress disorder. Upon obtaining the drug screen results, the nursing home decided not to hire the applicant. The applicant filed a complaint, alleging a violation of Connecticut’s medical marijuana law, which provides, “[n]o employer may refuse to hire a person or may discharge, penalize or threaten an employee solely on the basis of such person’s or employee’s status as a qualifying patient.” In addressing the applicant’s claims, the court held she was entitled to judgment, as a matter of law, on her claim of employment discrimination under the state medical marijuana law. Notably, the court rejected the employer’s arguments that it was required by federal laws (i.e., the Drug Free Workplace Act and the False Claims Act) to rescind the applicant’s job offer.
In sum, the legal landscape regarding medical marijuana in the employment context is evolving. Ohio’s medical marijuana law provides a number of important protections for employers regarding employment-related actions based on employees’ use, possession, or distribution of medical marijuana. With medical marijuana available in potentially as little as a couple of months, employers need to get prepared. This includes establishing policies that expressly address the employer’s stance on medical marijuana and determining how the employer intends to handle medical marijuana use in all aspects of its business, including hiring, drug testing, and discharge. Employers should contact counsel with any questions relating to the MMCP or its impact on their practices and workforces.
*Patrick M. Watts, an OSBA Certified Specialist in Labor and Employment Law, has extensive experience advising employers regarding medical marijuana and related issues. For more information about Ohio’s medical marijuana law or any other employment-related matters, please contact Patrick at pmw@zrlaw.com or 216.696.4441.
Lauren Drabic's practice encompasses all areas of labor and employment law. Prior to joining Zashin & Rich, Lauren practiced employment law in Washington, D.C., where she litigated cases in federal court and before administrative agencies that arose under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Whistleblower Protection Act, and other federal employment statutes. Lauren graduated from Allegheny College and received her law degree cum laude from the American University Washington College of Law. While at American, she served on the senior editorial board of the American University Law Review.
November 14, 2018
Brad E. Bennett presents “Epic Fails! Top Supervisor Errors in the Workplace” at the Ohio Recorders’ Association Winter Conference to be held at the Polaris Hilton in Columbus, Ohio.
December 4, 2018
George S. Crisci presents “Murphy Oil/Epic Systems” at the Ohio State Bar Association’s Back to the Future? NLRB Update seminar in Columbus, Ohio.
December 10, 2018
George S. Crisci presents “NLRB Rules and Decisions” at the National Business Institute’s Ohio Employment Law seminar in Independence, Ohio.
- Opioid Crisis: Drug Addiction and a Tight Labor Market
- ICE Raids: Cold Shouldering Employees, Employers, and Local Law Enforcement
- By the Book: Ohio Courts Look to Employee Handbooks to Determine Terminated Employees’ Entitlement to Payment for Unused PTO
- Rolled up and Rolled Out: An Update on Ohio’s Medical Marijuana Law
- Z&R SHORTS
Opioid Crisis: Drug Addiction and a Tight Labor Market
By Ami J. Patel*Following years of consecutive job growth, the unemployment rate dropped to 3.7% in September. Despite the decreasing unemployment rate, labor market participation remains low. Men ages 25 to 54 currently have an 88.4% labor participation rate. According to a recent report, of those males not participating, one in five is out of the workforce because of drug addiction. Drug abuse coupled with the current economy has made the tight labor market even tighter. According to the Ohio Chamber of Commerce, one-half of Ohio businesses report suffering consequences from substance abuse.
Ohio ranks among the hardest hit states in the ongoing battle against opiate addiction. The increased use of opiates and other more-accepted drugs like marijuana combined with a tight labor market has left many employers reevaluating their hiring and drug procedures.
Ohio is taking direct action to help employers struggling with drug-use issues. Ohio’s Chamber of Commerce created an Opiate Toolkit (available here) to help employers to manage risk, prevent drug abuse, and respond to issues affecting the workplace. The toolkit contains several modules to educate employers about workplace drug policy, employee drug testing, and responding to employee drug use. The toolkit also contains an hour-long employee education course designed to help foster understanding of prescription drug abuse.
Employers understandably wish to avoid or reduce the impacts of drug abuse on their workplaces. Drug abuse affects employers by causing increased liability, productivity problems, and financial loss. In seeking to protect their interests, however, employers must ensure that their policies and practices do not conflict with the Americans with Disabilities Act (“ADA”) or related state laws.
The ADA protects qualified individuals with disabilities. The ADA’s definition of “qualified individual with a disability” specifically excludes employees and applicants who are currently engaging in the illegal use of drugs. However, the ADA does not exclude from its protection: (a) successfully rehabilitated individuals who no longer engage in the illegal use of drugs; (b) those who are currently participating in a rehabilitation program and no longer engage in the illegal use of drugs; and (c) those who are regarded by an employer, erroneously, as illegal drug users. Accordingly, employers who discriminate against these groups of individuals may face liability under the ADA and similar state laws.
For example, the Equal Employment Opportunity Commission (“EEOC”) recently filed suit against an employer that fired a recovering opioid addict who was on a methadone treatment program. According to the EEOC, on the employee’s first day of work, he took a drug test and proceeded to work the rest of the week. The next week, he learned that his test came back “positive” as a result of his prescribed methadone treatment. After the employee provided the testing laboratory with verifying information regarding his treatment, the laboratory cleared him to work. Nonetheless, the employer refused to return the employee to his position, even after he provided a letter from his doctor regarding his treatment. Based upon the employer’s refusal, the EEOC is seeking a permanent injunction barring the employer from engaging in any future disability discrimination and compensatory and punitive damages on behalf of the employee.
In the midst of the opioid crisis, employers continue to face the practical and legal impacts of drug addiction. In addition to its effect on the labor market, this crisis also has important legal implications on employers’ management of their workforces, including employees and applicants who are in recovery from opioid addiction. Employers should proceed cautiously in addressing these complicated issues and contact counsel with questions.
*Ami J. Patel, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor and employment law. For more information about workplace issues relating to opioids, the ADA, or any other employment-law questions, please contact Ami at ajp@zrlaw.com or 216.696.4441.
ICE Raids: Cold Shouldering Employees, Employers, and Local Law Enforcement
By Lauren M. Drabic*The Trump administration has taken a hard stance against undocumented workers. The impact of this stance is far-reaching, especially in Ohio, which recently was called the “Ground Zero” for Immigration and Customs Enforcement (“ICE”) workplace raids. Two of the country’s largest raids occurred in Ohio over the summer and resulted in over 250 arrests.
The administration’s efforts regarding undocumented and foreign labor are two-pronged – arresting and deporting undocumented workers and prosecuting violating employers. Regarding the latter, the Department of Justice (“DOJ”) recently settled claims with a landscaping company for its alleged discriminatory practices in hiring foreign workers under the H-2B visa program. The DOJ claimed that the company favored foreign labor and improperly failed to make its job postings visible to those applying in the U.S. Under the settlement agreement, the company is required to pay over $100,000 in back pay and penalties, must engage in recruitment activities to attract U.S. workers, and is subject to three years of DOJ monitoring.
Employee Work Authorization
Most employers know they cannot hire workers without proper work authorization. Employers are responsible for ensuring completion of Form I-9, the Employment Eligibility Verification form used by U.S. Citizenship and Immigration Services (“USCIS”). This is true even with respect to employees who are citizens and, therefore, are automatically eligible for employment. Employers must retain each employee’s completed I-9 for three years after the date of hire or for one year after termination of employment, whichever occurs later. Employers should correct mistakes on an I-9 form to ensure they are compliant. However, employers may only edit sections two and three of the I-9 form. Only the employee may correct mistakes made in section one.While citizenship is not a requirement for employment, employees must have the necessary work authorization. USCIS requires that the worker be a member of one of four classes: U.S. citizens; noncitizen nationals; lawful permanent residents; and aliens authorized to work. An alien is any foreign citizen living in the U.S. An employer also can petition for a nonimmigrant worker to receive work authorization on a temporary basis by completing an I-129 form. Upon approval of the I-129 form, the worker must apply for admission to the U.S.
Employers must ensure they are hiring foreign workers properly without discriminating based on protected class, such as citizenship, immigration status, or national origin. Treating individuals differently based on their membership in a protected class could violate the Immigration and Nationality Act or Title VII of the Civil Rights Act, among other laws. Similarly, according to USCIS, it may be discriminatory for employers to consider future expiration dates on visas and employment authorization documents.
An employer unable to fill open positions may seek a Foreign Labor Certification from the Department of Labor. The process can take months and involves several government agencies. Several different visas and programs exist to fill persistent employment vacancies. However, the employer must verify that the open position meets the criteria set by the Department of Labor.
Criminal and Civil Penalties
Under the Immigration and Nationality Act, it is illegal for any person or entity to knowingly hire an undocumented or illegal alien. “Knowing” includes constructive knowledge, i.e., knowledge which may fairly be inferred through notice of certain facts and circumstances that would lead a person, through the exercise of reasonable care, to know that an alien is unauthorized. Simply not checking for authorization is not a valid means to avoid this requirement. Anyone who employs or contracts with an illegal alien without verifying his or her work authorization commits a misdemeanor offense.ICE is authorized to conduct investigations to determine whether employers knowingly employed unauthorized aliens or failed to properly complete and retain I-9 forms for newly-hired individuals. The Director of ICE has noted plans to dramatically increase the number of I-9 audits and workplace raids ICE conducts.
Employers who violate these laws can face substantial fines and criminal prosecution. Those who knowingly hire and employ workers without work authorization may be penalized from $375 to $16,000 per violation, whereas substantive and technical violations, such as failing to produce the I-9 form, can range from $110 to $1,100 per violation.
While ICE and Customs and Border Patrol cannot commandeer local law enforcement, many local agencies opt to work with the federal agencies by sharing information, conducting joint investigations, and contracting to detain arrested aliens. Immigration officers and police must have a valid warrant or an employer’s consent to enter their facilities.
Employers must take care not only to follow the various federal and state laws as they pertain to hiring foreign labor, but also must not discriminate against U.S. citizens when seeking out foreign labor. Likewise, employers must not discriminate based upon an employee’s protected class, including citizenship, immigration status, or national origin. Employers should contact counsel if they have any questions or are unsure how to navigate the complex legal landscape relating to foreign workers.
*Lauren Drabic recently joined Z&R’s Cleveland office and practices in all areas of employment law. If you have questions regarding I-9 form compliance or any other employment-related matter, please contact Lauren at lmd@zrlaw.com or 216.696.4441.
By the Book: Ohio Courts Look to Employee Handbooks to Determine Terminated Employees’ Entitlement to Payment for Unused PTO
By Christopher D. Caspary*Does an employer have to pay an employee’s accrued paid time off when it discharges the employee? As one Ohio court recently explained, it depends on the terms of the employer’s policies. See Richardson v. MYCAP, 7th Dist. Mahoning No. 17 MA 0021, 2018-Ohio-2776. In MYCAP, the court granted summary judgment in favor of a group of laid-off employees, awarding them payment for accrued paid time off (“PTO”). This is the latest decision in a string of Ohio cases that look to the terms of employer policies when determining an employee’s entitlement to a payout of accrued PTO at the time of the employee’s discharge.
The MYCAP Decision
In MCYAP, the employer provided its employees with handbooks informing them of its employment practices and policies. The handbook stated “at the end of employment with MYCAP, unused PTO balance hours will be paid” in accordance with a payment schedule set forth in the handbook. After the employer laid off a number of employees, it did not pay them their accrued, unused PTO in accordance with the terms of the handbook. The employees then filed suit seeking payment of their PTO.Finding in favor of the employees, the MYCAP Court citied to existing Ohio case law, which states “[a]lthough employee handbooks and policy manuals are not in and of themselves contracts of employment, they may define the terms and conditions of an at-will employment relationship if the employer and employee manifest an intention to be bound by them.” Accordingly, the MYCAP Court held that the employees were entitled to the PTO payments under the plain language of the handbook and that it would be unjust for the employer to retain those payments.
What Does This Mean For Employers?
Ohio courts’ continuing deference to the terms of employee handbooks and employer policies is favorable for employers with carefully drafted policies. Effectively written handbooks and policies protect employers from liability. For example, one Ohio court found that the following policy language - “All unused [PTO] will be forfeited upon an employee’s resignation or termination” – was clear and unambiguous and did not require the employer to pay out the employee’s PTO. See Majecic v. Universal Dev. Mgt. Corp., 11th Dist. Trumbull No. 2010-T-0119, 2011-Ohio-3752, ¶ 10. Likewise, another Ohio court determined that the plaintiffs were not entitled to PTO, because the employer’s policy clearly precluded its employees from collecting any payment for PTO upon discharge. See Sexton v. Oak Ridge Treatment Ctr. Acquisition Corp., 167 Ohio App. 3d 593, 856 N.E.2d 280, 2006-Ohio-3852, ¶ 13 (4th Dist.).Accordingly, employers should address the payment of PTO upon discharge directly in their employee handbooks and policy manuals. The following is a list of tips for employers to consider when drafting or revising employee handbooks and policies addressing PTO:
1. Do Not Remain Silent
It is better for an employer to have a written PTO policy than to remain silent. As some Ohio courts have held, an employee may be entitled to unused PTO if the employer’s policies do not state otherwise. The rationale behind this is that such payments are not merely gratuitous but are deferred payments of earned benefits. Therefore, it is better to have a defined policy than nothing addressing this topic.2. Say What You Mean
In MYCAP and other recent Ohio cases, the courts adhered to the language set forth in the applicable handbooks and policies. Ohio employers are not required by law to provide their employees with PTO. However, if an employer decides to provide this benefit and wishes to restrict it in any way, then the employer should do so explicitly and clearly in its written policies.3. Follow the Policy
The employer should abide by its policies. Failure to do so may suggest that the employer’s actual practice is different than what it has set forth in writing, or that it may be treating some employees more favorably than others.Employee handbooks and employer policies are important tools for employers, and the terms set forth therein have legal implications. Employers should consult with counsel to assess whether their handbooks and policies clearly state their intentions and to ensure they are taking the proper steps to abide by them.
*Christopher Caspary works in Z&R’s Cleveland office and practices in all areas of employment law. For more information about developing employee handbooks and policies or any other employment-related matter, please contact Chris at cdc@zrlaw.com or 216.696.4441.
Rolled up and Rolled Out: An Update on Ohio’s Medical Marijuana Law
By Patrick M. Watts*Although marijuana remains a Schedule I controlled substance under federal law, numerous states have legalized the use of marijuana for medical and, in eight states and the District of Columbia, recreational purposes. As Z&R previously reported, Ohio (puff, puff) passed its medical marijuana law in 2016 and set the basic framework for Ohio’s Medical Marijuana Control Program (“MMCP”). Following delays in the MMCP’s implementation process, approved cultivators have now begun growing their first crop of state-sanctioned marijuana. Based upon growing and production timeframes, estimates suggest that patients may purchase medical marijuana in Ohio as early as the end of this year.
As the smoke clears, many Ohio employers are rightfully concerned and confused about the MMCP and its potential implications for their businesses and workforces. In an apparent attempt to put employers at ease, Ohio’s General Assembly included a number of pro-employer provisions in the MMCP. Specifically, the MMCP (which is codified at Ohio Revised Code Chapter 3796) provides that:
- Employers are not required to permit or accommodate an employee’s use, possession, or distribution of medical marijuana;
- Employers are not prohibited from refusing to hire, discharging, disciplining, etc., a person because of that person’s use, possession, or distribution of medical marijuana;
- Employers are not prohibited from establishing and enforcing a drug testing policy, drug-free workplace policy, or zero-tolerance drug policy;
- The MMCP does not interfere with any federal restrictions on employment, e.g., Department of Transportation regulations; and
- The MMCP does not permit a person to pursue a lawsuit against an employer “for refusing to hire, discharging, disciplining, discriminating, retaliating, or otherwise taking an adverse employment action against a person with respect to hire, tenure, terms, conditions, or privileges of employment related to medical marijuana.”
See Ohio Revised Code 3796.28(a)(1)-(5). Furthermore, Ohio’s unemployment compensation law considers a person discharged for using marijuana “in violation of an employer’s drug-free workplace policy, zero-tolerance policy, or other formal program or policy regulating the use of medical marijuana” as discharged for “just cause.” See Ohio Revised Code 3796.28(b).
Nevertheless, even with these pro-employer provisions, Ohio employers still may face the prospect of litigation arising out of employees’ use of medical marijuana. For example, it is possible that employees may attempt to bring a disability discrimination claim under Ohio’s anti-discrimination law (Ohio Revised Code Chapter 4112), which the MMCP does not expressly reference, claiming that their rights under Ohio’s anti-discrimination law are unaffected by, and independent of, the MMCP’s pro-employer provisions.
Given the nascency of the MMCP, there currently are no court decisions addressing Ohio’s medical marijuana law in the employment context. However, courts in other states have addressed employees’ marijuana-related claims. It is important to note that medical marijuana laws vary by state and, depending on the state, may provide greater protection to employees than Ohio’s law. Still, these cases provide some insight as to how courts are addressing the issue of medical marijuana in the employment context. For example, as Z&R reported last year, the Massachusetts Supreme Judicial Court reversed the dismissal of an employee’s claim and held the employee could pursue a disability discrimination claim under Massachusetts law after her employer discharged her for testing positive for medical marijuana. See Barbuto v. Advantage Sales and Marketing, LLC, 78 N.E.3d 37 (Mass. Jul. 17, 2017).
Similarly, in September, a Federal court in Connecticut addressed a case where a nursing home rescinded a job offer to an applicant who tested positive for marijuana during a pre-employment drug screen. See Noffsinger v. SSC Niantic Operating Co., LLC, d/b/a Bride Brook Health & Rehab. Ctr., No. 3:16-cv-01938, 2018 U.S. Dist. LEXIS 150453 (D. Conn. Sept. 5, 2018). The applicant accepted an offer for a position, which was conditioned upon her completion of a drug screen. Prior to the drug screening, the applicant explained that she used medical marijuana to treat her post-traumatic stress disorder. Upon obtaining the drug screen results, the nursing home decided not to hire the applicant. The applicant filed a complaint, alleging a violation of Connecticut’s medical marijuana law, which provides, “[n]o employer may refuse to hire a person or may discharge, penalize or threaten an employee solely on the basis of such person’s or employee’s status as a qualifying patient.” In addressing the applicant’s claims, the court held she was entitled to judgment, as a matter of law, on her claim of employment discrimination under the state medical marijuana law. Notably, the court rejected the employer’s arguments that it was required by federal laws (i.e., the Drug Free Workplace Act and the False Claims Act) to rescind the applicant’s job offer.
In sum, the legal landscape regarding medical marijuana in the employment context is evolving. Ohio’s medical marijuana law provides a number of important protections for employers regarding employment-related actions based on employees’ use, possession, or distribution of medical marijuana. With medical marijuana available in potentially as little as a couple of months, employers need to get prepared. This includes establishing policies that expressly address the employer’s stance on medical marijuana and determining how the employer intends to handle medical marijuana use in all aspects of its business, including hiring, drug testing, and discharge. Employers should contact counsel with any questions relating to the MMCP or its impact on their practices and workforces.
*Patrick M. Watts, an OSBA Certified Specialist in Labor and Employment Law, has extensive experience advising employers regarding medical marijuana and related issues. For more information about Ohio’s medical marijuana law or any other employment-related matters, please contact Patrick at pmw@zrlaw.com or 216.696.4441.
Z&R SHORTS
Please join Z&R in welcoming Lauren Drabic to its Employment and Labor Groups
Lauren Drabic's practice encompasses all areas of labor and employment law. Prior to joining Zashin & Rich, Lauren practiced employment law in Washington, D.C., where she litigated cases in federal court and before administrative agencies that arose under Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, the Whistleblower Protection Act, and other federal employment statutes. Lauren graduated from Allegheny College and received her law degree cum laude from the American University Washington College of Law. While at American, she served on the senior editorial board of the American University Law Review.
Upcoming Speaking Engagements
November 14, 2018
Brad E. Bennett presents “Epic Fails! Top Supervisor Errors in the Workplace” at the Ohio Recorders’ Association Winter Conference to be held at the Polaris Hilton in Columbus, Ohio.
December 4, 2018
George S. Crisci presents “Murphy Oil/Epic Systems” at the Ohio State Bar Association’s Back to the Future? NLRB Update seminar in Columbus, Ohio.
December 10, 2018
George S. Crisci presents “NLRB Rules and Decisions” at the National Business Institute’s Ohio Employment Law seminar in Independence, Ohio.
Monday, October 8, 2018
More Protection for Employers: Ohio Supreme Court limits Temporary Total Disability Benefits
*By Scott Coghlan
On September 27, 2018, the Ohio Supreme Court limited Temporary Total Disability (“TTD”) benefits for injured workers. See State ex rel. Klein v. Precision Excavating & Grading Co., Slip Opinion No. 2018-Ohio-3890. The purpose of TTD is to compensate an injured worker for lost wages on the account of a workplace injury. Despite TTD’s purpose, the Court has muddied the waters regarding TTD eligibility over the past three decades. According to Klein, the Court is now holding claimants responsible for their own voluntary conduct and limiting benefits for employees who voluntarily abandon employment for reasons unrelated to their injury.
Prior to Klein, the Court held that claimants could never voluntarily abandon their employment if they were physically unable to perform their job. As a result, claimants could engage in conduct that resulted in the termination of their employment yet remain eligible to receive TTD benefits. Rather than focus solely on a worker’s physical capacity, the Court now focuses on whether an injured worker’s voluntary abandonment of employment is the cause of the lost wages as opposed to the alleged injury.
In the recognizing its past mistakes, the Court’s concurring opinion in Klein relied on Bilaver. In Bilaver, the attorneys of Zashin & Rich Co., L.P.A. successfully represented an employer in defeating a TTD claim. State ex rel. Bilaver v. Indus. Comm., 126 Ohio St.3d 1560, 2010-Ohio-4221, 933 N.E.2d 269. The plaintiff in Bilaver requested a seven week leave of absence to travel to Croatia. His employer denied the request and Bilaver gave a verbal two week notice of resignation. The employer promptly noted his resignation in his personnel file. Before his last day, Bilaver suffered a workplace injury. However, he still traveled to Croatia and then sought TTD compensation. In ruling in favor of the employer, the Court explained that Bilaver voluntarily abandoned his employment in the truest sense – he quit – and therefore was not entitled to TTD compensation.
Like Bilaver, Klein notified his employer several days before his work related injury that he was moving to Florida and inquired about proper procedures to quit his job. There was also evidence that prior to his injury, he told co-workers that was resigning and moving to Florida. The Court denied his request for TTD benefits after he moved to Florida, finding that his lost wages were due to his voluntary abandonment of his employment which was unrelated to his workplace injury.
Employers should be aware of this change in the law, that is, if an employee voluntarily removes himself from employment for reasons unrelated to a workplace injury, the employee is no longer eligible for TTD. Likewise, employers should immediately document any acts of voluntary abandonment. If, at any point, an employee expresses intent to resign from employment or violates a work rule, the employer should be quick to record the employee’s actions in writing to limit their liability. It may also be beneficial to accept an employee’s voluntary resignation on the spot, thank the employee for his service and pay him his next week’s salary. If the employers in Bilaver and Klein did that, the work-related injuries would have been avoided altogether.
*Scott Coghlan chairs the firm’s workers’ compensation group. He has over 20 years of experience defending workers’ compensation claims and representing employers in administrative proceedings and appeals to courts. For more information about temporary total disability or workers’ compensation issues, please contact Scott (sc@zrlaw.com) at 216.696.4441
On September 27, 2018, the Ohio Supreme Court limited Temporary Total Disability (“TTD”) benefits for injured workers. See State ex rel. Klein v. Precision Excavating & Grading Co., Slip Opinion No. 2018-Ohio-3890. The purpose of TTD is to compensate an injured worker for lost wages on the account of a workplace injury. Despite TTD’s purpose, the Court has muddied the waters regarding TTD eligibility over the past three decades. According to Klein, the Court is now holding claimants responsible for their own voluntary conduct and limiting benefits for employees who voluntarily abandon employment for reasons unrelated to their injury.
Prior to Klein, the Court held that claimants could never voluntarily abandon their employment if they were physically unable to perform their job. As a result, claimants could engage in conduct that resulted in the termination of their employment yet remain eligible to receive TTD benefits. Rather than focus solely on a worker’s physical capacity, the Court now focuses on whether an injured worker’s voluntary abandonment of employment is the cause of the lost wages as opposed to the alleged injury.
In the recognizing its past mistakes, the Court’s concurring opinion in Klein relied on Bilaver. In Bilaver, the attorneys of Zashin & Rich Co., L.P.A. successfully represented an employer in defeating a TTD claim. State ex rel. Bilaver v. Indus. Comm., 126 Ohio St.3d 1560, 2010-Ohio-4221, 933 N.E.2d 269. The plaintiff in Bilaver requested a seven week leave of absence to travel to Croatia. His employer denied the request and Bilaver gave a verbal two week notice of resignation. The employer promptly noted his resignation in his personnel file. Before his last day, Bilaver suffered a workplace injury. However, he still traveled to Croatia and then sought TTD compensation. In ruling in favor of the employer, the Court explained that Bilaver voluntarily abandoned his employment in the truest sense – he quit – and therefore was not entitled to TTD compensation.
Like Bilaver, Klein notified his employer several days before his work related injury that he was moving to Florida and inquired about proper procedures to quit his job. There was also evidence that prior to his injury, he told co-workers that was resigning and moving to Florida. The Court denied his request for TTD benefits after he moved to Florida, finding that his lost wages were due to his voluntary abandonment of his employment which was unrelated to his workplace injury.
Employers should be aware of this change in the law, that is, if an employee voluntarily removes himself from employment for reasons unrelated to a workplace injury, the employee is no longer eligible for TTD. Likewise, employers should immediately document any acts of voluntary abandonment. If, at any point, an employee expresses intent to resign from employment or violates a work rule, the employer should be quick to record the employee’s actions in writing to limit their liability. It may also be beneficial to accept an employee’s voluntary resignation on the spot, thank the employee for his service and pay him his next week’s salary. If the employers in Bilaver and Klein did that, the work-related injuries would have been avoided altogether.
*Scott Coghlan chairs the firm’s workers’ compensation group. He has over 20 years of experience defending workers’ compensation claims and representing employers in administrative proceedings and appeals to courts. For more information about temporary total disability or workers’ compensation issues, please contact Scott (sc@zrlaw.com) at 216.696.4441
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