*By Patrick J. Hoban
On July 22, 2014, two federal courts of appeals issued conflicting opinions over whether the IRS may grant tax credits to individuals who reside in states with Affordable Care Act (“ACA”) health care Exchanges established and operated by the federal government. See Halbig v. Burwell, No. 14-5018 (D.C. Cir. Jul. 22, 2014) (“Halbig”), King v. Burwell, No. 14-1158 (4th Cir. Jul. 22, 2014) (“King”).
The specific language of the ACA makes tax credits available to qualified individuals to subsidize the purchase of health insurance through “an Exchange established by the State.” This language seemingly limits tax credits to coverage obtained through a “state-established” Exchange and not an Exchange established by the Federal Government in a state that has elected not to establish an Exchange (i.e., Ohio). However, in 2013, the IRS promulgated regulations making tax credits available to qualifying individuals who purchase health insurance through an Exchange established by a state or by the Federal Government. In Halbig and King, individuals argued that the ACA’s clear language limits tax credits to individuals who obtain healthcare through state-established Exchanges and that the IRS regulations were unlawful.
In Halbig, the D.C. Circuit Court of Appeals agreed, found the ACA language clear, and concluded “established by the State” means what it plainly says. Since a federally-established Exchange is not an “Exchange established by the State,” the ACA does not authorize tax credits for insurance purchased on federal Exchanges. The court further held that the ACA’s broad policy goals (facilitating universal health care coverage at lower costs) do not alter this plain language. However, one of the three judges in Halbig dissented and concluded that, read in context and considered in light of the ACA’s larger purpose, Exchanges “established by the State” included federally-established Exchanges
Within hours of Halbig’s release, the Fourth Circuit Court of Appeals held that the IRS regulation granting tax credits for coverage obtained through federally-established Exchanges was lawful. In King, the Fourth Circuit determined that, when read in context, the ACA tax credit provisions were “ambiguous.” Although the court recognized that “common sense” and “a literal reading” favored the individual’s argument, when considered in light of the textual ambiguity and ACA’s overall purpose, the Fourth Circuit concluded that the U.S. Congress, through the ACA, had delegated to the IRS the authority to determine whether tax credits are available on federal Exchanges. Accordingly, the court concluded that the IRS made a permissible statutory interpretation and that the tax credit regulation was lawful
Should Halbig stand, it will have a monumental impact on the ACA’s future. Specifically, the Employer Mandate, which fines applicable large employers who do not offer group coverage to full-time employees and their dependents or offers “unaffordable” coverage or coverage that does not provide “minimum value,” will be unenforceable in the 34 states (including Ohio) in which federally-established Exchanges operate. Because ACA Employer Mandate fines are conditioned on one full-time employee’s eligibility for ACA tax credits, without tax credits there can be no Employer Mandate fines.
In addition to the enormous consequences for the operation of the Employer Mandate, if Halbig is upheld, many fewer individuals will have to comply with the ACA’s Individual Mandate, which requires people to maintain “minimum essential coverage” or pay a “tax.” The Individual Mandate does not apply to individuals for whom the annual cost of health care coverage, less any tax credits, exceeds eight percent of their projected household income. Thus, absent ACA tax credits, more individuals will be exempted from Individual Mandate taxes if they do not obtain coverage. As a consequence, experts predict that the covered pools in the Exchanges will include individuals who make greater use of covered benefits, driving up the cost of coverage under Exchanges.
The U.S. Justice Department announced that it will seek en banc review of Halbig before the full D.C. Circuit Court of Appeals (which has a 7 to 4 Democrat-president appointed majority). The D.C. Circuit stayed the decision in Halbig pending appeal and the IRS will continue to grant tax credits to individuals obtaining coverage through federally-established Exchanges. At present, there is no word on whether Appellants in King will appeal. However, given the starkly conflicting decisions and the enormous impact of a decision denying tax credits for coverage in federally-established Exchanges, the U. S. Supreme Court likely will decide whether the IRS may grant tax credits to individuals through federal Exchanges, and the fate of the Employer Mandate in 34 states including Ohio.
Zashin & Rich Co., L.P.A. will continue to track these cases and, as it has since the ACA was introduced in 2009, provide regular updates so employers have the information needed to avoid unplanned liability under the ACA.
*Patrick J. Hoban, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of private and public sector labor relations. Pat has advised employers on the ACA since its introduction in 2009 and has counseled employers on ACA compliance strategies since the statute’s enactment in March 2010. For more information about these court decisions, the ACA, or labor & employment law, please contact Pat (pjh@zrlaw.com) at 216.696.4441.
Friday, July 25, 2014
Tuesday, July 1, 2014
New Ohio Unemployment Benefit Requirements Making an Impact? Not Yet. Enforcement Delayed
By Andrew J. Cleves*
The Ohio Department of Jobs and Family Services (“ODJFS”) recently announced it will delay enforcement of new unemployment benefit regulations. In 2013, the Ohio legislature amended Ohio Revised Code § 4141.29, which details the steps Ohioans must take to maintain unemployment benefits. The new rules, which took effect on April 11, 2014, established a series of deadlines claimants must meet to maintain their unemployment benefits.
The new unemployment benefit rules require claimants to take a more active role in obtaining a job. Specifically, claimants must:
Under limited circumstances, unemployment claimants are exempt from the above-mentioned requirements: individuals laid off and scheduled to return to work within specific timeframes; individuals attending certain training courses or programs; qualifying students; and union members whose union refers them to jobs.
Unemployment claimants who applied on April 11, 2014 hit the eight-week deadline to create or upload a new resume on June 6, 2014. However, the OhioMeansJobs.com website had glitches, which prevented claimants from doing so. As such, ODJFS has delayed enforcement of the new requirements until the website works properly. So far, ODJFS has fixed some of the glitches and expects to begin enforcing the new requirements soon. If these new requirements reduce the unemployment rolls as hoped, they will also reduce the unemployment contributions employers must make.
The Ohio Department of Jobs and Family Services (“ODJFS”) recently announced it will delay enforcement of new unemployment benefit regulations. In 2013, the Ohio legislature amended Ohio Revised Code § 4141.29, which details the steps Ohioans must take to maintain unemployment benefits. The new rules, which took effect on April 11, 2014, established a series of deadlines claimants must meet to maintain their unemployment benefits.
The new unemployment benefit rules require claimants to take a more active role in obtaining a job. Specifically, claimants must:
- Upon initial application for unemployment benefits, register with OhioMeansJobs.com, a job matching system. With this registration information, ODJFS posts a basic resume on OhioMeansJobs.com for claimants;
- Within eight weeks of their application for unemployment benefits, create or upload a new resume to their OhioMeansJobs.com account. Claimants must maintain their resumes in an active, public, and searchable form so potential employers can find and review the resumes;
- Upon receipt of benefits for 14 weeks, complete core assessment tests for mathematics, reading, and locating information, designed to “measure real world skills;” and
- Upon receipt of benefits for 20 weeks, complete a career profile assessment, designed to match interests with career fields.
Under limited circumstances, unemployment claimants are exempt from the above-mentioned requirements: individuals laid off and scheduled to return to work within specific timeframes; individuals attending certain training courses or programs; qualifying students; and union members whose union refers them to jobs.
Unemployment claimants who applied on April 11, 2014 hit the eight-week deadline to create or upload a new resume on June 6, 2014. However, the OhioMeansJobs.com website had glitches, which prevented claimants from doing so. As such, ODJFS has delayed enforcement of the new requirements until the website works properly. So far, ODJFS has fixed some of the glitches and expects to begin enforcing the new requirements soon. If these new requirements reduce the unemployment rolls as hoped, they will also reduce the unemployment contributions employers must make.
*Andrew J. Cleves practices in all areas of labor and employment law. If you have questions about the unemployment compensation process, please contact Andrew(ajc@zrlaw.com) at 216.696.4441.
Thursday, June 26, 2014
Supreme Court’s Noel Canning Decision “Cans” Unconstitutional NLRB Appointments – Hundreds of NLRB Decisions Null and Void
Today, the United States Supreme Court invalidated approximately 331 National Labor Relations Board (“NLRB”) decisions. In NLRB v. Noel Canning, the Supreme Court held that the President improperly appointed three NLRB Members on January 4, 2012. The Court’s determination invalidated hundreds of NLRB decisions because the NLRB improperly exercised its powers between January 4, 2012 and August 5, 2013.
The President attempted to circumvent the Senate confirmation process by invoking the Constitution’s Recess Appointment Clause, which allows the President to fill vacancies during Senate recesses. Between December 17, 2011 and January 23, 2012, the Senate only held twice-weekly pro forma sessions, where it conducted no business, including one session on January 3 and another on January 6. When the President appointed three NLRB members on January 4, he created a quorum (at least 3 of 5 Board members) for the NLRB. Without proper appointments, the NLRB lacked a quorum until August 5, 2013, and any intervening decisions were invalid. The Supreme Court determined that: (1) the Senate was in session during those pro forma sessions and (2) recesses of less than 10 days are presumptively too short under the Recess Appointment Clause. The President lacked the authority to make appointments during the three-day recess.
The 331 invalid decisions include some important ones, such as:
(1) Costco Wholesale Corp, which invalidated an employer policy prohibiting employees from making social media statements that could damage the company or other employees’ reputations;
(2) WKYC-TV, Inc., requiring contract dues deduction provisions to continue after a collective bargaining agreement expires; and
(3) Alan Ritchey, Inc., prohibiting an employer from enforcing discretionary discipline on employees of a newly-certified union without giving notice and an offer to bargain. While the decisions will likely not change due to the Board’s current make-up, all 331 decisions now hang in the balance.
The Supreme Court’s ruling also jeopardizes decisions and actions by other recess appointments, including NLRB Member Becker and potentially even federal court judges.
Recent filibuster changes, however, blunt the impact of this decision. All NLRB appointments now likely require approval of 51 members of the Senate.
*Patrick J. Hoban, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of private and public sector labor relations. For more information about the Noel Canning decision or labor & employment law, please contact Pat (pjh@zrlaw.com) at 216.696.4441.
Thursday, June 19, 2014
EMPLOYMENT LAW QUARTERLY | Summer 2014, Volume XVI, Issue ii
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When an employee receives holiday and vacation pay, should that count towards the Family and Medical Leave Act’s 1,250 “hours of service” eligibility requirement? The U.S. Court of Appeals for the Sixth Circuit, which covers Kentucky, Michigan, Ohio, and Tennessee, doesn’t think so. In Saulsberry v. Federal Express Corp., the Sixth Circuit concluded that only the hours an employee actually works count towards the 1,250-hour eligibility requirement. 2014 U.S. App. LEXIS 819 (6th Cir.).
The employee in Saulsberry requested FMLA leave for vertigo. His employer denied the request because he “had not met the FMLA’s 1,250-hours-worked-requirement.” The FMLA defines an “eligible employee” as “an employee who has been employed . . . for at least 12 months by the employer . . . and . . . for at least 1,250 hours of service . . . during the previous 12-month period.” 29 U.S.C. §2611(2)(A).
Here, the employee met the 12-month tenure requirement but did not also meet the 1,250 “hours of service” within the previous year requirement. The Sixth Circuit reasoned that the employee had to prove “he actually worked 1,250 hours.” He argued he met this requirement by pointing to an employee report that stated he “put in” 1,257 hours within the year. However, the report included two different hours totals on subsequent lines. One line listed the total hours paid and the following line included an hours worked total. An employer representative stated the employer records demonstrated that the employee worked 1,136 hours during the preceding 12 months. The court carefully considered the distinction between the hours the employee actually worked and the hours for which he was paid. The employee admitted the total hours paid included vacation and holiday pay he did not actually work. In addition, the employee stated he believed his employer kept an accurate account and record of his hours worked. Since the employee did not work the requisite 1,250 hours, the court held the employee was not entitled to FMLA leave and upheld dismissal of his FMLA claim.
This case serves as an excellent reminder that hours worked and not hours paid determine an employee’s eligibility for FMLA leave. Employers should keep detailed and accurate records of hours worked, as compared to hours paid.
*Patrick M. Watts, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor & employment law and has extensive experience dealing with the FMLA. If you have any questions about the FMLA’s requirements, standards, or application, please contact Patrick (pmw@zrlaw.com) at 216.696.4441.
To compensate or not to compensate, that is the question for “donning and doffing” clothing and gear prior to and after work. Truth be told, Shakespeare’s version was a much easier question to resolve. The U.S. Supreme Court’s decision in Sandifer v. United States Steel Corp. sheds light on this issue that has troubled employers since the enactment of the Fair Labor Standards Act of 1938 (FLSA). 134 S. Ct. 870 (2014). The issue before the Court was whether “donning and doffing” certain protective gear was compensable pursuant to the FLSA. The 12 items that were in question: flame-retardant jacket, pants, hood, hardhat, snood (hood that covers neck and shoulder area), wristlets (detached shirtsleeves), work gloves, leggings, metatarsal (steel-toed) boots, safety glasses, earplugs, and a respirator. The Court found that only the safety glasses, ear plugs, and respirator were not clothes under the Act.
The distinction of whether the items were clothes was important because pursuant to Section 203(o) of the FLSA, non-compensable time includes “time spent in changing clothes or washing at the beginning or end of each workday which was excluded from measured working time during the week involved by the express terms of or by custom or practice under a bona fide collective-bargaining agreement.” 29 U.S.C. § 203(o). The collective bargaining agreement at issue did just that. The Court determined that 9 of the 12 items were subject to exclusion because they “cover the body and are commonly regarded as articles of dress.” The Court found that the parties could collectively bargain away compensation with respect to these items.
The remaining three items were compensable, and per the collective bargaining agreement, the employer could not exclude them; however, the time spent putting on these “non-clothes” was not the majority of time spent “donning and doffing” gear. Therefore, the employer did not need to compensate for this time. Conversely, if the majority of the time is spent “donning or doffing” non-clothes, the time spent “donning or doffing” clothes becomes compensable.
Clearly, employers should ensure that employees are paid for all time worked. As a result, employers must fully understand what constitutes compensable time under the FLSA.
*Michele L. Jakubs, an OSBA Certified Specialist in Labor and Employment Law, has extensive experience counseling employers on state and federal wage and hour laws. For more information about “donning and doffing” or the FLSA, please contact Michele (mlj@zrlaw.com) at 216.696.4441.
The EEOC recently flexed its statutory muscle by suing CVS for allegedly interfering with its employees’ access to the EEOC. According to the lawsuit, the company’s separation agreement interfered with employees’ right to communicate with, participate in proceedings conducted by, and file charges with the EEOC. Since these restrictions allegedly violate Section 707 of Title VII of The Civil Rights Act of 1964, the EEOC was able to seek immediate relief through a federal lawsuit. Section 707 prohibits employers from "engag[ing] in a pattern or practice of resistance to the full enjoyment" of any rights Title VII secures.
In the complaint, the EEOC claimed the following provisions in the separation agreement created a “pattern or practice of resistance:”
In filing its complaint, the EEOC touted that its most-recent “Strategic Enforcement Plan” identified “preserving access to the legal system” as a top priority. On April 30, 2014, the EEOC again demonstrated its commitment to this priority by suing CollegeAmerica based on its separation agreement. Similar to CVS, CollegeAmerica included the following in its severance agreements: 1) a non-disparagement provision; 2) an agreement not to file complaints against the employer; 3) an agreement not to assist others in claims against the employer; and 4) a release of all claims. The EEOC, in part, based its lawsuit on the employer’s demand that one former employee return her severance pay for allegedly violating the non-disparagement clause. In addition, the employer sued the former employee for filing an EEOC charge.
These lawsuits demonstrate that the EEOC likely will continue to pursue these types of claims. Companies should review their employee separation and severance agreements in light of these recent lawsuits filed by the EEOC.
*Ami J. Patel, practices in all areas of labor and employment law. If you have questions about your severance or separation agreements, please contact Ami (ajp@zrlaw.com) at 216.696.4441.
The issue of a fair minimum wage has been a popular one in headlines and political debates in the last year or so, as cities, states, and the federal government address whether or not to raise it. With less media attention, another wage issue has been gaining momentum among communities: paid sick days. On April 1, 2014, 200,000 New Yorkers became eligible for paid sick days when the Earned Sick Time Act took effect. Generally, the act requires all businesses with five or more employees to provide 40 hours of paid sick leave to employees who work more than 80 hours in a calendar year. The law also requires employers of fewer than five employees to provide 40 hours of unpaid sick leave. The list of family members for whom an employee may use paid sick leave includes children, spouses, parents, grandparents, grandchildren, and siblings.
As goes New York City, so goes the rest of the country? Yes and no. Like with minimum wage, cities and states are taking the lead on whether employers must provide paid sick days. While no federal law requires employers to provide paid sick leave, the Family and Medical Leave Act generally requires employers to provide unpaid sick leave. Connecticut is the only state that requires employers to offer paid sick days to employees, but it may not be the only state for long. California has a bill pending in the state legislature that would offer one paid sick day for every 30 days worked. Several cities, including Seattle, San Francisco, Washington, D.C., Portland, Newark, and Jersey City have enacted paid sick day laws for their citizens. Of course, these measures are not without opposition. Eleven states (Arizona, Florida, Georgia, Indiana, Kansas, Louisiana, Mississippi, North Carolina, Oklahoma, Tennessee, and Wisconsin) have passed legislation making it illegal for cities or municipalities to enact paid sick leave laws.
If you are an employer, you may be wondering if your company’s sick leave policy is compliant and whether Ohio is contemplating similar steps. Currently, Ohio does not mandate paid sick leave, and none of the cities in the state have enacted ordinances requiring it. In 2008, the Ohio Healthy Families Act, which would have required employers with 25 or more employees to provide seven days per year of paid sick leave, was removed from the ballot. The main supporter, Service Employees International Union, withdrew the measure in order to focus on a federal paid sick leave law that never passed. No laws mandating paid sick leave are pending in the Ohio state legislature or any of its major cities, but if the national trend continues, the issue will surely arise soon.
*Sarah K. Ott practices in all areas of labor and employment law. For more information about paid sick leave laws, please contact Sarah (sko@zrlaw.com) at 216.696.4441.
In 1978 the first human was born after being conceived by in vitro fertilization (IVF). That same year, Congress amended Title VII of the Civil Rights Act of 1964 (Title VII) to prohibit discrimination based on pregnancy. This amendment, known as the Pregnancy Discrimination Act (PDA), protects pregnant women from employers’ discriminatory actions including refusals to hire and discharges. The scope of the PDA is unclear when applied to women utilizing assisted reproductive technology that are not yet pregnant. Regardless of the PDA’s impact, employers are not free to discriminate against these women based on their intention to become pregnant, as discrimination based on “child-bearing capacity” is illegal under Title VII.
Under the PDA, covered employers cannot discriminate against employees or applicants “on the basis of pregnancy, childbirth, or related medical conditions.” In analyzing claims under the PDA, the U.S. Court of Appeals for the Sixth Circuit generally requires the plaintiff to prove: (i) she was pregnant; (ii) she was qualified for her position; (iii) her employer took an adverse employment action against her; and (iv) there was a nexus between her pregnancy and her employer’s employment decision. Under this framework, PDA coverage would not extend to individuals undergoing assisted reproductive technology treatments that have not yet become pregnant. However, the individual may still have a viable claim under Title VII for gender discrimination based on her child-bearing capacity.
A federal district court in Michigan recently addressed the intricacies of a discrimination claim involving assisted reproductive technology. In that case, the plaintiff, who worked as a lead dental instructor, notified her supervisor she planned to become pregnant by IVF. During the plaintiff’s IVF treatment, her supervisor demoted her to the position of teaching assistant so she could sit while working because she was, in her supervisor’s words, “being pumped with so many hormones.” After taking a week of vacation leave after completing her procedure, the plaintiff miscarried upon returning to work. The next day, the plaintiff’s supervisor demoted the plaintiff, later stating she was too “focused on babies” because she intended to use IVF again and was emotionally unstable as a result of her IVF treatments. The plaintiff alleged her supervisor eventually terminated her based on her gender and pregnancy.
Relying on the Sixth Circuit’s analysis of PDA claims, the court refused to reach the conclusion that non-pregnant plaintiffs utilizing IVF can successfully bring claims under the PDA. First, the court held that the plaintiff stated a plausible claim under the PDA with respect to her demotion following her miscarriage, as she was actually pregnant and a miscarriage is a pregnancy-related condition. With respect to the plaintiff’s termination, which she alleged was based on her intention to become pregnant again, the court analyzed the claim not as a PDA claim, but rather as a Title VII gender discrimination claim. In doing so, the court recognized child-bearing capacity is a solely female characteristic, and therefore, discrimination based on child-bearing capacity is the very type of gender-based discrimination Title VII prohibits.
Employers should be cautious when making employment decisions that affect employees who express their intent to become pregnant or who utilize assisted reproductive technology. Even though employees utilizing assisted reproductive technology may not yet be pregnant, they are still protected from discriminatory actions directed at their attempts to become pregnant. While courts may be reluctant to analyze such claims under the PDA, employees who utilize assisted reproductive technology might state a claim under Title VII.
*Drew C. Piersall practices in the firm's Columbus office. He has extensive experience counseling employers on Title VII and the PDA. For more information about these topics or any other labor and employment need, please contact Drew (dcp@zrlaw.com) at 216.696.4441.
Consider the following scenario: an employer terminates an employee for just cause. The employee subsequently files for unemployment compensation and the employer challenges the application. The case goes to hearing where the hearing officer concludes that the employer terminated the employment of the employee for just cause. Unhappy with the result, the employee sues the employer in federal court. Can the federal court consider evidence and determinations made during the unemployment compensation process? One Alabama federal court recently answered that question with a resounding yes.
In Franks v. Indian Rivers Medical Health Ctr., the district court judge dismissed a former employee's Family and Medical Leave Act (FMLA) lawsuit based on the "collateral estoppel" doctrine, which generally provides that when a valid and final judgment determines an issue, the same parties cannot litigate that issue again. 2014 U.S. Dist LEXIS 15544 (N.D. Ala. Feb. 7, 2014). The Franks judge concluded that since the Alabama unemployment commission already determined the employer terminated its employee for dishonesty, the employee’s subsequent FMLA claim also failed. Although the Franks judge ruled in the employer’s favor, the decision highlights the potential pitfalls of challenging a former employee’s request for unemployment compensation. Evidence submitted, testimony introduced, and even a hearing officer’s decision itself may be utilized in subsequent litigation where the stakes are typically higher.
Ohio Revised Code §4141.21 prohibits evidence submitted during the unemployment compensation process from admission in any court proceeding. Nonetheless, federal courts in Ohio have concluded that evidence submitted in the unemployment compensation process is "not absolutely privileged and should not be stricken." Klaus v. Hilb, Rogal & Hamilton Co. of Ohio, 437 F. Supp. 2d 706 (S.D. Ohio 2006). For example, the Klaus court admitted the employer's unemployment compensation statements in a later gender discrimination lawsuit. The employer initially had stated it terminated the former employee for "lack of production." However, the employer later stated it terminated the employee because the company was "winding up a line of business." Finding these statements at odds, the court commented that maintaining the O.R.C. §4141.21 privilege would enable parties to hide information in the unemployment compensation process. Thus, Ohio employers should be careful about what evidence, testimony, and information they submit when challenging a request for unemployment compensation.
So, how should an employer approach the unemployment compensation process when it anticipates future litigation? The safest bet is to involve counsel early. To the extent an employer challenges a request for unemployment compensation, it is imperative the employer has a clear understanding of what led to the claimant’s separation and provides accurate information. An employer never wants to be in a position in which they are trying to explain away earlier inaccurate submissions.
*David P. Frantz practices in all areas of labor and employment law. If you have questions about the unemployment compensation process, please contact David (dpf@zrlaw.com) at 216.696.4441.
Under the Family and Medical Leave Act (FMLA), employees are entitled to return to their same job or an equivalent position after taking leave. As recently demonstrated by a federal court in Arizona, the degree of equivalence under the FMLA can be construed strictly against an employer.
Under the FMLA, covered employers generally must provide eligible employees with up to 12 weeks of unpaid leave for personal medical reasons or to tend to the medical needs of a family member. In order to ensure that employees are not punished for taking this leave, the FMLA requires employers to reinstate employees returning from leave to either: (1) the position the employee held before taking leave; or (2) a different position that is equivalent in benefits, pay, and conditions of employment. Employers must use caution when assigning a returning employee to a position different from the one the employee held before taking leave.
In order to comply with the “equivalent position” requirement, identical job title alone will not likely suffice, at least according to a federal court in Arizona. Prior to taking FMLA leave, an employee of a collection agency worked as a collector on an account for a major bank. In that position, she received a 35% commission on collections. After returning from leave, her employer assigned her to another account collecting for credit card companies. She only received 28% commission in her new assignment, but her employer argued her new position provided her an opportunity to earn more due to a higher rate of collection on the credit card accounts. Despite the fact that the employee was a “collector” both before and after her leave, a federal district court in Arizona held she had presented a triable claim under the FMLA based upon whether the employer assigned her to an “equivalent” job.
Upon an employee’s return from FMLA leave, employers often are faced with limited options regarding job placement. The most risk-adverse approach is to place the returning employee into the exact position the employee held before taking leave, without altering any conditions of the position (e.g., wages, benefits, etc.). However, this approach may not be possible in all situations. As an alternative, the employer may place a returning employee into an equivalent position but should proceed cautiously when doing so and ensure the position is equivalent in benefits, pay, and other employment conditions.
*Stephen S. Zashin, an OSBA Certified Specialist in Labor and Employment Law and the head of the firm's labor and employment group, has extensive experience counseling employers on FMLA compliance issues. For more information about the FMLA or any other labor and employment need, please contact Stephen (ssz@zrlaw.com) at 216.696.4441.
Sarah's practice encompasses all areas of labor and employment law, including employment discrimination, legal compliance, and labor relations. As a student at The Ohio State University Moritz College of Law, Sarah won an award for excellence in legal negotiations. Prior to joining Zashin & Rich, Sarah practiced in the area of general litigation with a Cleveland-area solo practitioner. While in law school, she interned for two judges in the Southern District of Ohio and at the Ohio Environmental Protection Agency.
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- Fun Fact: Holiday and Vacation Time Does Not Count as Hours Worked Under the FMLA
- Donning and Doffing: To Compensate or Not To Compensate
- Say What? EEOC Takes Issue with CVS's Separation Agreement Language
- Paid Sick Days: Are Employers Facing an Epidemic?
- Implications of Assisted Reproductive Technology on Pregnancy and Gender Discrimination
- You Can't Use That! Right? Wrong. Use of Unemployment Hearing Evidence in Subsequent Litigation
- Right to Return: Equivalent Positions After FMLA Leave
- Z&R SHORTS
Fun Fact: Holiday and Vacation Time Does Not Count as Hours Worked Under the FMLA
By Patrick M. Watts*When an employee receives holiday and vacation pay, should that count towards the Family and Medical Leave Act’s 1,250 “hours of service” eligibility requirement? The U.S. Court of Appeals for the Sixth Circuit, which covers Kentucky, Michigan, Ohio, and Tennessee, doesn’t think so. In Saulsberry v. Federal Express Corp., the Sixth Circuit concluded that only the hours an employee actually works count towards the 1,250-hour eligibility requirement. 2014 U.S. App. LEXIS 819 (6th Cir.).
The employee in Saulsberry requested FMLA leave for vertigo. His employer denied the request because he “had not met the FMLA’s 1,250-hours-worked-requirement.” The FMLA defines an “eligible employee” as “an employee who has been employed . . . for at least 12 months by the employer . . . and . . . for at least 1,250 hours of service . . . during the previous 12-month period.” 29 U.S.C. §2611(2)(A).
Here, the employee met the 12-month tenure requirement but did not also meet the 1,250 “hours of service” within the previous year requirement. The Sixth Circuit reasoned that the employee had to prove “he actually worked 1,250 hours.” He argued he met this requirement by pointing to an employee report that stated he “put in” 1,257 hours within the year. However, the report included two different hours totals on subsequent lines. One line listed the total hours paid and the following line included an hours worked total. An employer representative stated the employer records demonstrated that the employee worked 1,136 hours during the preceding 12 months. The court carefully considered the distinction between the hours the employee actually worked and the hours for which he was paid. The employee admitted the total hours paid included vacation and holiday pay he did not actually work. In addition, the employee stated he believed his employer kept an accurate account and record of his hours worked. Since the employee did not work the requisite 1,250 hours, the court held the employee was not entitled to FMLA leave and upheld dismissal of his FMLA claim.
This case serves as an excellent reminder that hours worked and not hours paid determine an employee’s eligibility for FMLA leave. Employers should keep detailed and accurate records of hours worked, as compared to hours paid.
*Patrick M. Watts, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of labor & employment law and has extensive experience dealing with the FMLA. If you have any questions about the FMLA’s requirements, standards, or application, please contact Patrick (pmw@zrlaw.com) at 216.696.4441.
Donning and Doffing: To Compensate or Not To Compensate
By Michele L. Jakubs*To compensate or not to compensate, that is the question for “donning and doffing” clothing and gear prior to and after work. Truth be told, Shakespeare’s version was a much easier question to resolve. The U.S. Supreme Court’s decision in Sandifer v. United States Steel Corp. sheds light on this issue that has troubled employers since the enactment of the Fair Labor Standards Act of 1938 (FLSA). 134 S. Ct. 870 (2014). The issue before the Court was whether “donning and doffing” certain protective gear was compensable pursuant to the FLSA. The 12 items that were in question: flame-retardant jacket, pants, hood, hardhat, snood (hood that covers neck and shoulder area), wristlets (detached shirtsleeves), work gloves, leggings, metatarsal (steel-toed) boots, safety glasses, earplugs, and a respirator. The Court found that only the safety glasses, ear plugs, and respirator were not clothes under the Act.
The distinction of whether the items were clothes was important because pursuant to Section 203(o) of the FLSA, non-compensable time includes “time spent in changing clothes or washing at the beginning or end of each workday which was excluded from measured working time during the week involved by the express terms of or by custom or practice under a bona fide collective-bargaining agreement.” 29 U.S.C. § 203(o). The collective bargaining agreement at issue did just that. The Court determined that 9 of the 12 items were subject to exclusion because they “cover the body and are commonly regarded as articles of dress.” The Court found that the parties could collectively bargain away compensation with respect to these items.
The remaining three items were compensable, and per the collective bargaining agreement, the employer could not exclude them; however, the time spent putting on these “non-clothes” was not the majority of time spent “donning and doffing” gear. Therefore, the employer did not need to compensate for this time. Conversely, if the majority of the time is spent “donning or doffing” non-clothes, the time spent “donning or doffing” clothes becomes compensable.
Clearly, employers should ensure that employees are paid for all time worked. As a result, employers must fully understand what constitutes compensable time under the FLSA.
*Michele L. Jakubs, an OSBA Certified Specialist in Labor and Employment Law, has extensive experience counseling employers on state and federal wage and hour laws. For more information about “donning and doffing” or the FLSA, please contact Michele (mlj@zrlaw.com) at 216.696.4441.
Say What? EEOC Takes Issue with CVS's Separation Agreement Language
By Ami J. Patel*The EEOC recently flexed its statutory muscle by suing CVS for allegedly interfering with its employees’ access to the EEOC. According to the lawsuit, the company’s separation agreement interfered with employees’ right to communicate with, participate in proceedings conducted by, and file charges with the EEOC. Since these restrictions allegedly violate Section 707 of Title VII of The Civil Rights Act of 1964, the EEOC was able to seek immediate relief through a federal lawsuit. Section 707 prohibits employers from "engag[ing] in a pattern or practice of resistance to the full enjoyment" of any rights Title VII secures.
In the complaint, the EEOC claimed the following provisions in the separation agreement created a “pattern or practice of resistance:”
- Cooperation provision: requires employees to “promptly notify” the company’s general counsel if the employee receives an inquiry related to any “civil, criminal, or administrative investigation.”
- Non-Disparagement provision: prevents employees from making statements that disparage the company.
- Non-Disclosure and Confidential Information provision: prohibits employees from disclosing confidential information without express authorization from the company’s HR director. Confidential information includes “information concerning the Corporation’s personnel, including . . . affirmative action plans or planning.”
- General Release of Claims provision: provides for an all-encompassing release of claims, including a release from any charges (e.g., EEOC Charge) and specifically includes “any claim of unlawful discrimination of any kind.”
- No Pending Actions; Covenant Not to Sue provision: states the employee has not filed and agrees not to file any action, including a complaint (e.g., EEOC complaint), against the company.
- Breach of Employee Covenants and Injunctive Relief provision: requires the employee acknowledge that any separation agreement breach will “result in irreparable injury” to the company and requires the employee to reimburse the employer for reasonable attorney costs if the company obtains an injunction against the employee.
In filing its complaint, the EEOC touted that its most-recent “Strategic Enforcement Plan” identified “preserving access to the legal system” as a top priority. On April 30, 2014, the EEOC again demonstrated its commitment to this priority by suing CollegeAmerica based on its separation agreement. Similar to CVS, CollegeAmerica included the following in its severance agreements: 1) a non-disparagement provision; 2) an agreement not to file complaints against the employer; 3) an agreement not to assist others in claims against the employer; and 4) a release of all claims. The EEOC, in part, based its lawsuit on the employer’s demand that one former employee return her severance pay for allegedly violating the non-disparagement clause. In addition, the employer sued the former employee for filing an EEOC charge.
These lawsuits demonstrate that the EEOC likely will continue to pursue these types of claims. Companies should review their employee separation and severance agreements in light of these recent lawsuits filed by the EEOC.
*Ami J. Patel, practices in all areas of labor and employment law. If you have questions about your severance or separation agreements, please contact Ami (ajp@zrlaw.com) at 216.696.4441.
Paid Sick Days: Are Employers Facing an Epidemic?
By By Sarah K. Ott*The issue of a fair minimum wage has been a popular one in headlines and political debates in the last year or so, as cities, states, and the federal government address whether or not to raise it. With less media attention, another wage issue has been gaining momentum among communities: paid sick days. On April 1, 2014, 200,000 New Yorkers became eligible for paid sick days when the Earned Sick Time Act took effect. Generally, the act requires all businesses with five or more employees to provide 40 hours of paid sick leave to employees who work more than 80 hours in a calendar year. The law also requires employers of fewer than five employees to provide 40 hours of unpaid sick leave. The list of family members for whom an employee may use paid sick leave includes children, spouses, parents, grandparents, grandchildren, and siblings.
As goes New York City, so goes the rest of the country? Yes and no. Like with minimum wage, cities and states are taking the lead on whether employers must provide paid sick days. While no federal law requires employers to provide paid sick leave, the Family and Medical Leave Act generally requires employers to provide unpaid sick leave. Connecticut is the only state that requires employers to offer paid sick days to employees, but it may not be the only state for long. California has a bill pending in the state legislature that would offer one paid sick day for every 30 days worked. Several cities, including Seattle, San Francisco, Washington, D.C., Portland, Newark, and Jersey City have enacted paid sick day laws for their citizens. Of course, these measures are not without opposition. Eleven states (Arizona, Florida, Georgia, Indiana, Kansas, Louisiana, Mississippi, North Carolina, Oklahoma, Tennessee, and Wisconsin) have passed legislation making it illegal for cities or municipalities to enact paid sick leave laws.
If you are an employer, you may be wondering if your company’s sick leave policy is compliant and whether Ohio is contemplating similar steps. Currently, Ohio does not mandate paid sick leave, and none of the cities in the state have enacted ordinances requiring it. In 2008, the Ohio Healthy Families Act, which would have required employers with 25 or more employees to provide seven days per year of paid sick leave, was removed from the ballot. The main supporter, Service Employees International Union, withdrew the measure in order to focus on a federal paid sick leave law that never passed. No laws mandating paid sick leave are pending in the Ohio state legislature or any of its major cities, but if the national trend continues, the issue will surely arise soon.
*Sarah K. Ott practices in all areas of labor and employment law. For more information about paid sick leave laws, please contact Sarah (sko@zrlaw.com) at 216.696.4441.
Implications of Assisted Reproductive Technology on Pregnancy and Gender Discrimination
By Drew C. Piersall*In 1978 the first human was born after being conceived by in vitro fertilization (IVF). That same year, Congress amended Title VII of the Civil Rights Act of 1964 (Title VII) to prohibit discrimination based on pregnancy. This amendment, known as the Pregnancy Discrimination Act (PDA), protects pregnant women from employers’ discriminatory actions including refusals to hire and discharges. The scope of the PDA is unclear when applied to women utilizing assisted reproductive technology that are not yet pregnant. Regardless of the PDA’s impact, employers are not free to discriminate against these women based on their intention to become pregnant, as discrimination based on “child-bearing capacity” is illegal under Title VII.
Under the PDA, covered employers cannot discriminate against employees or applicants “on the basis of pregnancy, childbirth, or related medical conditions.” In analyzing claims under the PDA, the U.S. Court of Appeals for the Sixth Circuit generally requires the plaintiff to prove: (i) she was pregnant; (ii) she was qualified for her position; (iii) her employer took an adverse employment action against her; and (iv) there was a nexus between her pregnancy and her employer’s employment decision. Under this framework, PDA coverage would not extend to individuals undergoing assisted reproductive technology treatments that have not yet become pregnant. However, the individual may still have a viable claim under Title VII for gender discrimination based on her child-bearing capacity.
A federal district court in Michigan recently addressed the intricacies of a discrimination claim involving assisted reproductive technology. In that case, the plaintiff, who worked as a lead dental instructor, notified her supervisor she planned to become pregnant by IVF. During the plaintiff’s IVF treatment, her supervisor demoted her to the position of teaching assistant so she could sit while working because she was, in her supervisor’s words, “being pumped with so many hormones.” After taking a week of vacation leave after completing her procedure, the plaintiff miscarried upon returning to work. The next day, the plaintiff’s supervisor demoted the plaintiff, later stating she was too “focused on babies” because she intended to use IVF again and was emotionally unstable as a result of her IVF treatments. The plaintiff alleged her supervisor eventually terminated her based on her gender and pregnancy.
Relying on the Sixth Circuit’s analysis of PDA claims, the court refused to reach the conclusion that non-pregnant plaintiffs utilizing IVF can successfully bring claims under the PDA. First, the court held that the plaintiff stated a plausible claim under the PDA with respect to her demotion following her miscarriage, as she was actually pregnant and a miscarriage is a pregnancy-related condition. With respect to the plaintiff’s termination, which she alleged was based on her intention to become pregnant again, the court analyzed the claim not as a PDA claim, but rather as a Title VII gender discrimination claim. In doing so, the court recognized child-bearing capacity is a solely female characteristic, and therefore, discrimination based on child-bearing capacity is the very type of gender-based discrimination Title VII prohibits.
Employers should be cautious when making employment decisions that affect employees who express their intent to become pregnant or who utilize assisted reproductive technology. Even though employees utilizing assisted reproductive technology may not yet be pregnant, they are still protected from discriminatory actions directed at their attempts to become pregnant. While courts may be reluctant to analyze such claims under the PDA, employees who utilize assisted reproductive technology might state a claim under Title VII.
*Drew C. Piersall practices in the firm's Columbus office. He has extensive experience counseling employers on Title VII and the PDA. For more information about these topics or any other labor and employment need, please contact Drew (dcp@zrlaw.com) at 216.696.4441.
You Can't Use That! Right? Wrong. Use of Unemployment Hearing Evidence in Subsequent Litigation
By David P. Frantz*Consider the following scenario: an employer terminates an employee for just cause. The employee subsequently files for unemployment compensation and the employer challenges the application. The case goes to hearing where the hearing officer concludes that the employer terminated the employment of the employee for just cause. Unhappy with the result, the employee sues the employer in federal court. Can the federal court consider evidence and determinations made during the unemployment compensation process? One Alabama federal court recently answered that question with a resounding yes.
In Franks v. Indian Rivers Medical Health Ctr., the district court judge dismissed a former employee's Family and Medical Leave Act (FMLA) lawsuit based on the "collateral estoppel" doctrine, which generally provides that when a valid and final judgment determines an issue, the same parties cannot litigate that issue again. 2014 U.S. Dist LEXIS 15544 (N.D. Ala. Feb. 7, 2014). The Franks judge concluded that since the Alabama unemployment commission already determined the employer terminated its employee for dishonesty, the employee’s subsequent FMLA claim also failed. Although the Franks judge ruled in the employer’s favor, the decision highlights the potential pitfalls of challenging a former employee’s request for unemployment compensation. Evidence submitted, testimony introduced, and even a hearing officer’s decision itself may be utilized in subsequent litigation where the stakes are typically higher.
Ohio Revised Code §4141.21 prohibits evidence submitted during the unemployment compensation process from admission in any court proceeding. Nonetheless, federal courts in Ohio have concluded that evidence submitted in the unemployment compensation process is "not absolutely privileged and should not be stricken." Klaus v. Hilb, Rogal & Hamilton Co. of Ohio, 437 F. Supp. 2d 706 (S.D. Ohio 2006). For example, the Klaus court admitted the employer's unemployment compensation statements in a later gender discrimination lawsuit. The employer initially had stated it terminated the former employee for "lack of production." However, the employer later stated it terminated the employee because the company was "winding up a line of business." Finding these statements at odds, the court commented that maintaining the O.R.C. §4141.21 privilege would enable parties to hide information in the unemployment compensation process. Thus, Ohio employers should be careful about what evidence, testimony, and information they submit when challenging a request for unemployment compensation.
So, how should an employer approach the unemployment compensation process when it anticipates future litigation? The safest bet is to involve counsel early. To the extent an employer challenges a request for unemployment compensation, it is imperative the employer has a clear understanding of what led to the claimant’s separation and provides accurate information. An employer never wants to be in a position in which they are trying to explain away earlier inaccurate submissions.
*David P. Frantz practices in all areas of labor and employment law. If you have questions about the unemployment compensation process, please contact David (dpf@zrlaw.com) at 216.696.4441.
Right to Return: Equivalent Positions After FMLA Leave
By Stephen S. Zashin*Under the Family and Medical Leave Act (FMLA), employees are entitled to return to their same job or an equivalent position after taking leave. As recently demonstrated by a federal court in Arizona, the degree of equivalence under the FMLA can be construed strictly against an employer.
Under the FMLA, covered employers generally must provide eligible employees with up to 12 weeks of unpaid leave for personal medical reasons or to tend to the medical needs of a family member. In order to ensure that employees are not punished for taking this leave, the FMLA requires employers to reinstate employees returning from leave to either: (1) the position the employee held before taking leave; or (2) a different position that is equivalent in benefits, pay, and conditions of employment. Employers must use caution when assigning a returning employee to a position different from the one the employee held before taking leave.
In order to comply with the “equivalent position” requirement, identical job title alone will not likely suffice, at least according to a federal court in Arizona. Prior to taking FMLA leave, an employee of a collection agency worked as a collector on an account for a major bank. In that position, she received a 35% commission on collections. After returning from leave, her employer assigned her to another account collecting for credit card companies. She only received 28% commission in her new assignment, but her employer argued her new position provided her an opportunity to earn more due to a higher rate of collection on the credit card accounts. Despite the fact that the employee was a “collector” both before and after her leave, a federal district court in Arizona held she had presented a triable claim under the FMLA based upon whether the employer assigned her to an “equivalent” job.
Upon an employee’s return from FMLA leave, employers often are faced with limited options regarding job placement. The most risk-adverse approach is to place the returning employee into the exact position the employee held before taking leave, without altering any conditions of the position (e.g., wages, benefits, etc.). However, this approach may not be possible in all situations. As an alternative, the employer may place a returning employee into an equivalent position but should proceed cautiously when doing so and ensure the position is equivalent in benefits, pay, and other employment conditions.
*Stephen S. Zashin, an OSBA Certified Specialist in Labor and Employment Law and the head of the firm's labor and employment group, has extensive experience counseling employers on FMLA compliance issues. For more information about the FMLA or any other labor and employment need, please contact Stephen (ssz@zrlaw.com) at 216.696.4441.
Z&R SHORTS
Zashin & Rich is pleased to announce the addition of Sarah K. Ott to the firm's Employment and Labor Group in its Cleveland office.
Sarah's practice encompasses all areas of labor and employment law, including employment discrimination, legal compliance, and labor relations. As a student at The Ohio State University Moritz College of Law, Sarah won an award for excellence in legal negotiations. Prior to joining Zashin & Rich, Sarah practiced in the area of general litigation with a Cleveland-area solo practitioner. While in law school, she interned for two judges in the Southern District of Ohio and at the Ohio Environmental Protection Agency.
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Wednesday, May 14, 2014
New COBRA Guidance Changes Notification Requirements
*By Patrick J. Hoban
Recently, the Department of Labor (“DOL”) released guidance, available here, that changes employee notification requirements under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”). Employees covered under a group health plan are entitled to notices regarding their rights under COBRA. The new notice requirements include information regarding the Health Insurance Marketplace (“Exchanges”) under the Patient Protection and Affordable Care Act
The DOL has provided an updated model continuation coverage “general notice,” available here, and updated model continuation coverage “election notice,” available here. Covered employees and covered spouses/dependents are entitled to the general notice upon the commencement of their employment and the election notice within a short time period following a “qualifying event” (e.g., termination of employment). The DOL considers use of the model notices “to be good faith compliance with the . . . notice content requirements of COBRA,” at least until the DOL finalizes its rules with respect to the notices
The new general notice language informs employees of their potential eligibility for coverage through the Exchanges or under another group health plan (e.g., a spouse’s plan) through a “special enrollment period” as opposed to COBRA continuation coverage.
The new election notice language sets forth in bold print “You may be able to get coverage through the Health Insurance Marketplace that costs less than COBRA continuation coverage” and provides three pages of information relating to the Exchanges. In addition to describing options other than COBRA continuation coverage, the election notice advises that “it can be difficult or impossible to switch to another” option once a decision is made
Additionally, the Department of Health and Human Services (“HHS”) released a bulletin, available here, announcing a “special enrollment period” lasting through July 1, 2014 for qualified individuals to drop their COBRA coverage and enroll in a plan under an Exchange. This “special enrollment period” only applies to the federal Exchange and the HHS bulletin encourages state-based Exchanges to adopt similar enrollment periods.
Employers and plan administrators should take note of the model notices and remain alert as the notices are subject to change and may be modified as the DOL finalizes its rules. For the time being, use of the model notices constitutes good faith compliance with COBRA’s notice requirements.
*Patrick J. Hoban practices in all areas of labor and employment law. For more information about COBRA notices or any other labor and employment needs, please contact Patrick pjh@zrlaw.com) at 216.696.4441.
Recently, the Department of Labor (“DOL”) released guidance, available here, that changes employee notification requirements under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”). Employees covered under a group health plan are entitled to notices regarding their rights under COBRA. The new notice requirements include information regarding the Health Insurance Marketplace (“Exchanges”) under the Patient Protection and Affordable Care Act
The DOL has provided an updated model continuation coverage “general notice,” available here, and updated model continuation coverage “election notice,” available here. Covered employees and covered spouses/dependents are entitled to the general notice upon the commencement of their employment and the election notice within a short time period following a “qualifying event” (e.g., termination of employment). The DOL considers use of the model notices “to be good faith compliance with the . . . notice content requirements of COBRA,” at least until the DOL finalizes its rules with respect to the notices
The new general notice language informs employees of their potential eligibility for coverage through the Exchanges or under another group health plan (e.g., a spouse’s plan) through a “special enrollment period” as opposed to COBRA continuation coverage.
The new election notice language sets forth in bold print “You may be able to get coverage through the Health Insurance Marketplace that costs less than COBRA continuation coverage” and provides three pages of information relating to the Exchanges. In addition to describing options other than COBRA continuation coverage, the election notice advises that “it can be difficult or impossible to switch to another” option once a decision is made
Additionally, the Department of Health and Human Services (“HHS”) released a bulletin, available here, announcing a “special enrollment period” lasting through July 1, 2014 for qualified individuals to drop their COBRA coverage and enroll in a plan under an Exchange. This “special enrollment period” only applies to the federal Exchange and the HHS bulletin encourages state-based Exchanges to adopt similar enrollment periods.
Employers and plan administrators should take note of the model notices and remain alert as the notices are subject to change and may be modified as the DOL finalizes its rules. For the time being, use of the model notices constitutes good faith compliance with COBRA’s notice requirements.
*Patrick J. Hoban practices in all areas of labor and employment law. For more information about COBRA notices or any other labor and employment needs, please contact Patrick pjh@zrlaw.com) at 216.696.4441.
Tuesday, April 8, 2014
Whether Unionized or Not, Employers Must Review Their Employee Handbooks for NLRA Issues, Before the NLRB Does it for Them
*By Patrick J. Hoban
In March 2011, a hospital issued an employee a written disciplinary warning for posting the following on Facebook: “Holy shit rock on [S!]. Way to talk about the douchebags you used to work with. I LOVE IT!!” In response, the employee in the non-union facility filed an unfair labor practice charge with the National Labor Relations Board (“NLRB”). On April 1, 2014, the NLRB upheld an administrative law judge’s decision and invalidated the employee handbook provision under which the hospital disciplined the employee. Hills & Dales General Hospital, 360 NLRB No. 70 (April 1, 2014). In another decision issued on April 2, 2014, the NLRB invalidated a handbook provision which prohibited “discourteous or inappropriate attitude or behavior to passengers, other employees, or members of the public.” First Transit, Inc, 360 NLRB No. 72 (April 2, 2014). In both decisions, the NLRB found each employer violated Section 8(a)(1) of the National Labor Relations Act (“NLRA”) for unlawfully interfering with employee rights under the NLRA. These decisions again demonstrate that employers without unions or active union organizing are subject to the NLRA and that the NLRB will parse even the clearest and most reasonable employee handbook or work rule language to find a violation.
In Hills & Dales General Hospital, the non-unionized employer disciplined the employee for the offensive Facebook posting in violation of a handbook provision requiring employees to “represent Hills & Dales in the community in a positive and professional manner in every opportunity.” According to the NLRB, employees would reasonably conclude this paragraph prevented them from making negative remarks about the hospital in public. The NLRB explained that a rule requiring employees to represent the hospital in a “positive and ethical” manner would not have run afoul of the NLRA. However, the NLRB found that the word “professional” is a “broad and flexible concept as applied to employee behavior” and its inclusion in the provision rendered it unlawful on its face (although the NLRB did not address whether the discipline itself was unlawful).
In First Transit, where there was no discipline and some facility employees were unionized, the NLRB found numerous handbook provisions prohibiting theft, “poor work habits,” and “profane or abusive language where the language used is uncivil, insulting, contemptuous, vicious, or malicious” lawful. However, the NLRB found the provision prohibiting “discourteous or inappropriate” behavior unlawfully overbroad as, the NLRB concluded, employees would reasonably conclude it prohibited them from communicating about their employment. The handbook at issue in First Transit included a “Freedom of Association” provision affirming employee rights to organize a union and the employer’s pledge not to interfere with such activity. The employer argued that this language made clear to employees that the handbook terms did not restrict NLRA rights. However, when reviewing the Freedom of Association policy, the NLRB determined its placement was neither “prominent nor proximate” to the facially unlawful rules. In short, the NLRB concluded that employees could not reasonably be expected to apply the disclaimer to every policy in the 73-page handbook.
Although in First Transit the NLRB upheld a policy prohibiting “profane or abusive” language, both decisions highlight the wide range of employee speech the NLRB considers protected under the NLRA. Specifically, First Transit invalidated the prohibition on “discourteous and inappropriate” behavior because “no wording provide[d] a context limiting the rule to legitimate business concerns such as uncooperation [sic] with supervisors.” In Hills & Dales General Hospital, the NLRB invalidated the provision that it concluded prevented employees from making “negative comments about . . . team members” because that definition included managers.
The Hills & Dales General Hospital and First Transit decisions are the latest in the NLRB’s assertion of authority as an “Editor-in-Chief” of employer policies. In 2010, the NLRB found probable cause to issue a complaint when an employer disciplined an employee for calling her supervisor a “scumbag” on Facebook. American Medical Response of Connecticut, Inc., 34-CA-12576. In an Advice Memorandum concerning the case, the NLRB’s General Council concluded that an employee calling a supervisor a “scumbag” was protected activity because the NLRB “ha[d] found more egregious name-calling protected.”
These recent NLRB decisions demonstrate that employers must carefully review employee handbooks and workplace policies with an eye toward the aggressive parsing of the NLRB. Additionally, any employer, unionized or not, can face charges based on employment policies. Finally, while most reasonable people can agree that an employee who refers to co-workers as “douchebags” or to supervisors as “scumbags” has a damaging effect on the workplace, the NLRB may find that activity protected. As a result, all employers should carefully consider these issues and consult counsel before disciplining employees for similar misconduct.
*Patrick J. Hoban, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of private and public sector labor relations. For more information about the NLRB decision or labor & employment law, please contact Pat (pjh@zrlaw.com) at 216.696.4441.
In March 2011, a hospital issued an employee a written disciplinary warning for posting the following on Facebook: “Holy shit rock on [S!]. Way to talk about the douchebags you used to work with. I LOVE IT!!” In response, the employee in the non-union facility filed an unfair labor practice charge with the National Labor Relations Board (“NLRB”). On April 1, 2014, the NLRB upheld an administrative law judge’s decision and invalidated the employee handbook provision under which the hospital disciplined the employee. Hills & Dales General Hospital, 360 NLRB No. 70 (April 1, 2014). In another decision issued on April 2, 2014, the NLRB invalidated a handbook provision which prohibited “discourteous or inappropriate attitude or behavior to passengers, other employees, or members of the public.” First Transit, Inc, 360 NLRB No. 72 (April 2, 2014). In both decisions, the NLRB found each employer violated Section 8(a)(1) of the National Labor Relations Act (“NLRA”) for unlawfully interfering with employee rights under the NLRA. These decisions again demonstrate that employers without unions or active union organizing are subject to the NLRA and that the NLRB will parse even the clearest and most reasonable employee handbook or work rule language to find a violation.
In Hills & Dales General Hospital, the non-unionized employer disciplined the employee for the offensive Facebook posting in violation of a handbook provision requiring employees to “represent Hills & Dales in the community in a positive and professional manner in every opportunity.” According to the NLRB, employees would reasonably conclude this paragraph prevented them from making negative remarks about the hospital in public. The NLRB explained that a rule requiring employees to represent the hospital in a “positive and ethical” manner would not have run afoul of the NLRA. However, the NLRB found that the word “professional” is a “broad and flexible concept as applied to employee behavior” and its inclusion in the provision rendered it unlawful on its face (although the NLRB did not address whether the discipline itself was unlawful).
In First Transit, where there was no discipline and some facility employees were unionized, the NLRB found numerous handbook provisions prohibiting theft, “poor work habits,” and “profane or abusive language where the language used is uncivil, insulting, contemptuous, vicious, or malicious” lawful. However, the NLRB found the provision prohibiting “discourteous or inappropriate” behavior unlawfully overbroad as, the NLRB concluded, employees would reasonably conclude it prohibited them from communicating about their employment. The handbook at issue in First Transit included a “Freedom of Association” provision affirming employee rights to organize a union and the employer’s pledge not to interfere with such activity. The employer argued that this language made clear to employees that the handbook terms did not restrict NLRA rights. However, when reviewing the Freedom of Association policy, the NLRB determined its placement was neither “prominent nor proximate” to the facially unlawful rules. In short, the NLRB concluded that employees could not reasonably be expected to apply the disclaimer to every policy in the 73-page handbook.
Although in First Transit the NLRB upheld a policy prohibiting “profane or abusive” language, both decisions highlight the wide range of employee speech the NLRB considers protected under the NLRA. Specifically, First Transit invalidated the prohibition on “discourteous and inappropriate” behavior because “no wording provide[d] a context limiting the rule to legitimate business concerns such as uncooperation [sic] with supervisors.” In Hills & Dales General Hospital, the NLRB invalidated the provision that it concluded prevented employees from making “negative comments about . . . team members” because that definition included managers.
The Hills & Dales General Hospital and First Transit decisions are the latest in the NLRB’s assertion of authority as an “Editor-in-Chief” of employer policies. In 2010, the NLRB found probable cause to issue a complaint when an employer disciplined an employee for calling her supervisor a “scumbag” on Facebook. American Medical Response of Connecticut, Inc., 34-CA-12576. In an Advice Memorandum concerning the case, the NLRB’s General Council concluded that an employee calling a supervisor a “scumbag” was protected activity because the NLRB “ha[d] found more egregious name-calling protected.”
These recent NLRB decisions demonstrate that employers must carefully review employee handbooks and workplace policies with an eye toward the aggressive parsing of the NLRB. Additionally, any employer, unionized or not, can face charges based on employment policies. Finally, while most reasonable people can agree that an employee who refers to co-workers as “douchebags” or to supervisors as “scumbags” has a damaging effect on the workplace, the NLRB may find that activity protected. As a result, all employers should carefully consider these issues and consult counsel before disciplining employees for similar misconduct.
*Patrick J. Hoban, an OSBA Certified Specialist in Labor and Employment Law, practices in all areas of private and public sector labor relations. For more information about the NLRB decision or labor & employment law, please contact Pat (pjh@zrlaw.com) at 216.696.4441.
Tuesday, March 18, 2014
Good Ideas from USCIS: Who Knew? Form I-9 Employee Info Sheet now available
*By Helena Oroz
U.S. Citizenship and Immigration Services (USCIS) recently issued a Form I-9 Employee Information Sheet. The Information Sheet is intended as an employee reference for common Form I-9 questions, such as “Which documents do I need to show my employer?” and “Can I get in trouble if I lie on the form?”
The Information Sheet is available here in English and Spanish. Compared to the instructions on the actual Form I-9 (also an improvement over the old Form I-9), the Information Sheet communicates directly to the employee through a conversational question-and-answer format.
Federal law requires every employer to complete a Form I-9, Employment Eligibility Verification, for each new employee to verify his or her identity and authorization to work in the United States. (Reminder: all employers should be using only the newest edition of Form I-9, issued March 8, 2013.)
Additional guidance from USCIS for both employees and employers is available on its “I-9 Central” web site. This guidance seems clearer, more concise, and more user-friendly as compared to previous years, and even includes instructional I-9 video vignettes that employers can show to new employees.
While employers are not obligated to provide employees with the Information Sheet or any information apart from the Form I-9 itself, doing so may help both employers and employees by saving time and avoiding misunderstandings with respect to common I-9 questions. The chances of employees reading this one-pager over a nine-page Form I-9 are, mathematically speaking, quite good. It may not answer every question or lead to perfect communication in the workplace, but we think it’s a good start and a good idea.
*Helena Oroz practices in all areas of employment law and has extensive experience with Form I-9 compliance and auditing. For more information about the Form I-9 Information Sheet or other I-9 questions, please contact Helena at hot@zrlaw.com or 216.696.4441.
U.S. Citizenship and Immigration Services (USCIS) recently issued a Form I-9 Employee Information Sheet. The Information Sheet is intended as an employee reference for common Form I-9 questions, such as “Which documents do I need to show my employer?” and “Can I get in trouble if I lie on the form?”
The Information Sheet is available here in English and Spanish. Compared to the instructions on the actual Form I-9 (also an improvement over the old Form I-9), the Information Sheet communicates directly to the employee through a conversational question-and-answer format.
Federal law requires every employer to complete a Form I-9, Employment Eligibility Verification, for each new employee to verify his or her identity and authorization to work in the United States. (Reminder: all employers should be using only the newest edition of Form I-9, issued March 8, 2013.)
Additional guidance from USCIS for both employees and employers is available on its “I-9 Central” web site. This guidance seems clearer, more concise, and more user-friendly as compared to previous years, and even includes instructional I-9 video vignettes that employers can show to new employees.
While employers are not obligated to provide employees with the Information Sheet or any information apart from the Form I-9 itself, doing so may help both employers and employees by saving time and avoiding misunderstandings with respect to common I-9 questions. The chances of employees reading this one-pager over a nine-page Form I-9 are, mathematically speaking, quite good. It may not answer every question or lead to perfect communication in the workplace, but we think it’s a good start and a good idea.
*Helena Oroz practices in all areas of employment law and has extensive experience with Form I-9 compliance and auditing. For more information about the Form I-9 Information Sheet or other I-9 questions, please contact Helena at hot@zrlaw.com or 216.696.4441.
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