Employer Law Report

EEOC’s wellness rules to be finalized early 2016

The Equal Employment Opportunity Commission’s (EEOC) regulatory agenda indicated that it intends to finalize its two rules governing employer wellness programs under the Americans with Disabilities Act (ADA) and the Genetic Information Non-Discrimination Act (GINA) by February 2016. You can read about the proposed ADA changes here. The EEOC just recently published its proposal to amend the rules implementing GINA as they relate to employer wellness plans in late October, 2015. If adopted, these rules would allow an employer that offers a wellness program as part of a group health plan to provide limited financial and other incentives in exchange for an employee’s spouse providing information about his or her current or past health status. The proposed rule, however, would not permit any incentives to be provided in exchange for children’s current or past health information based on the theory that the possibility of discrimination against the employee based on genetic information is greater when the employer has access to information about the health status of the employee’s children versus the employee’s spouse. Read more about these proposed rules here. According to the EEOC, the proposed rule would provide a narrow exception to the general rule in GINA that prohibits incentives in exchange for an employee’s genetic information.

Overtime proposed rules delayed

The proposed rules on overtime issued by the Department of Labor (DOL) earlier this year will likely not be final until late 2016 according to Solicitor of Labor Patricia Smith, as reported by the Wall Street Journal. Employers had been expecting the rule to go into effect late 2015 or early 2016, the Journal said, but now that seems unlikely.

The proposed rules were released June 30 of this year and have received over 250,000 comments, which may explain why the agency is taking so long to finalize them. Many commentators believe that the agency will still seek to have the regulations implemented prior to a new president taking office because there is a risk that a new Republican president could undo the rule. If that’s the case, employers may have a short amount of time before the rules are finalized and when they become effective.

Employers should be getting ready now for various scenarios that may be implemented under the final rule. Although there is a possibility that the final rule might be revoked if a Republican wins the presidency next November, employers would be wise to prepare for all potential outcomes now.

Silence equals acquiesence, equals promissory estoppel claim

In Jennifer Trehar v. Brightway Center, Inc., the Seventh District Court of Appeals held that a promissory estoppel claim can lie even without an explicit promise—silence where an ordinary person would make a statement or take action.


Jennifer Trehar was employed at Brightway Center, a Christian non-profit, since 2010. In June 2012, she claimed she informed Brightway on two different occasions that she planned to move in with her boyfriend. She claimed that, on the first occasion, she was congratulated by her boss on the move. On the second occasion, she was granted permission to miss a work function in order to make arrangements for her boyfriend to move.

In July 2012, Trehar again informed Brightway of her move. However, this time Brightway responded by sending Trehar a letter suspending her for the month of July and providing her one month to determine if she wished to get married, stop living with her boyfriend, or be terminated. The letter cited the organization’s religious ideals as the basis for the decision. Trehar did not change her living situation and was terminated.

Trehar sued, alleging promissory estoppel, claiming that Brightway knew about her living arrangement in advance of her formally moving; approved of it on two different occasions; and assured her that she would remain employed. She claimed that she relied on those promises of continued employment and moved. Brightway claimed in response that it was aware Trehar was moving and that her boyfriend was also moving, but was unaware she would be living with her boyfriend and his children until just prior to sending the suspension letter.

Court Decisions

While Ohio is an at-will employment state, promissory estoppel is an exception to that doctrine. The elements necessary for a promissory estoppel claim are “(1) a clear and unambiguous promise, (2) reasonable and foreseeable reliance by the party to whom the promise is made, and (3) injury by the reliance by the party claiming estoppel.”

In this case, Brightway filed a motion for summary judgment on the basis that there was no specific and explicit promise of continued employment. The trial court agreed and dismissed the case.

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OSHA fines to increase almost 80%

For the first time since 1990, the Occupational Safety and Health Administration (OSHA) will increase its fines to reflect inflation. For willful and repeat citations, this will mean an increase in the maximum possible penalty from $70,000 to around $125,000. For serious citations, it will mean an increase in the maximum possible penalty from $7,000 to around $12,600. The Bipartisan Budget Act of 2015, signed into law by President Obama on November 2, allows OSHA a one time “initial adjustment” for inflation and then allows OSHA to adjust for inflation annually after that.

OSHA penalties are calculated from a number of factors including severity of the alleged violation, the likelihood of injury, the size of the employer, and the employee’s demonstrated good faith efforts to comply. This significant increase in the maximum allowable OSHA penalties is a good reason for all companies to revisit their programs for OSHA compliance and their safety policies.


NLRB General Counsel Advice Memo absolves employer for not bargaining over use of GPS devices to track employee

Wait…. What?

Yes, in Shore Point Distribution Co., Inc., the NLRB’s General Counsel’s Office issued an Advice Memorandum yesterday (dated October 15, 2015) in which it stated that an employer did not violate Section 8(a)(5) of the National Labor Relations Act by failing to bargain with union before installing a GPS device on an employee’s truck.

In March 2015, the employer became concerned that one of its employees was taking more time than other drivers to complete the same routes. It therefore hired a private investigator to follow and videotape the driver on his routes. The employer placed a GPS device on the employee’s truck to ensure that the investigator would be able to regain contact with the truck if he lost visual contact during the course of the surveillance. Over the course of his surveillance of the employee, the investigator personally observed the employee engaging in work rule violations including operating his truck in an unsafe and illegal manner, failing to follow specified delivery times, stealing time, and falsifying his daily log. Finally, after the GPS located the employee stopped in the employee’s hometown, he located the employee’s truck parked in the driveway at his home during work hours. Thereafter, the employer terminated the employee based on the investigator’s report. There is no indication that the employee was ever aware that the GPS device had been installed on his truck or that the employer had notified its employees that it might use GPS tracking for any reason in association with their employment.

Hard to see the NLRB’s General Counsel going along with this. Obviously, there are some other facts at play here.

First, the collective bargaining agreement contained work rules that prohibited drivers from “stealing time” and requiring that they adhere to Department of Transportation regulations mandating that drivers accurately account for their time on daily log records.

Second, the employer “has a practice of retaining a private investigator to follow an employee suspected of stealing time and using any results obtained through the investigator’s personal observations for disciplinary purposes.” The union was aware of this practice and “has no objection to it.”

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Employers must take their employees as they are – pre-existing conditions included

Ohio law has long held that an employee’s particular health conditions, personal frailties and peculiar susceptibilities do not prohibit the employee from having a compensable work injury when the injury occurred in the course of and arising out of the employee’s employment. Ohio courts do not deny an employee a compensable claim merely because the employee’s physical fitness at the time of the work incident rendered him more susceptible to the injury than an otherwise healthy individual.

Recently, an Ohio employer questioned the compensability of a workers’ compensation claim when an employee with pre-existing arthritis suffered a subsequent work-related injury. In Luettke v. Autoneum N. Am., Inc.,, the Sixth Appellate District found the injured worker sustained a compensable injury. In October 2006, Ruth Luettke (“Luettke”) fractured her left leg in a work-related fall. An MRI of her left knee demonstrated osteoarthritis. Thereafter, Luettke complained of occasional pain, but continued to work full duty. In August 2012, Luettke alleged that while holding a pry bar to open a dock plate, she put her weight on her left foot, turned and felt a snap in her left knee.  She sought to have a workers’ compensation claim recognized for the conditions of sprain of the left knee and tear of her quad tendon.   Both Luettke’s physician and the employer’s examining physician opined that Luettke suffered from pre-existing arthritis and that Luettke’s injury would not have occurred in an otherwise healthy individual. The Industrial Commission recognized the claim and the employer appealed to court.

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Second Circuit upholds NLRB finding that Triple Play Sports Grille unlawfully terminated employees for Facebook postings

Back in September of last year, we reported on an NLRB decision finding that a Connecticut sports bar, Triple Play Sports Bar & Grille, had unlawfully terminated two employees – one of whom commented on a former employee’s criticism of the employer’s handling of the tax withholding on employee paychecks and the other who clicked “Like” in response to that comment. This past week, the Second Circuit, on Triple Play’s petition for review, upheld the Board’s decision, in a case captioned Three D, LLC, d/b/a Triple Play Sports Bar & Grille v. NLRB.

In its decision, the Second Circuit held that the employees’ respective comment and “Like” were protected concerted activity under Section 7 of the National Labor Relations Act because they both related to ongoing employee concerns over the employer’s workplace tax withholding and their resulting tax liabilities. The court also concluded that the employees’ Facebook communications were not so disloyal or defamatory as to lose the protection of the Act. Specifically, the court found that the employees did not disparage the employer’s products or services and their communications were not “maliciously untrue.”

The court was not swayed by any profanity contained in the one employee’s comment because it was not made in the presence of or directed at customers and did not reflect the employer’s brand. According to the court, accepting Triple Play’s argument that the Facebook discussion took place “in the presence of customers” could lead to the undesirable result of chilling virtually all employee speech online. “Almost all Facebook posts by employees have at least some potential to be viewed by customers.” As a result, the court upheld the Board’s order requiring the employer to offer reinstatement and full back pay to the terminated employees.

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The use of criminal background checks to make employment decisions is not without peril

One of the first cases filed by the U.S. Equal Employment Opportunity Commission (EEOC) following its 2012 updated guidance on the use of arrest and conviction records in employment decisions has been resolved. Last month, a federal court in South Carolina approved a settlement in which BMW Manufacturing Co., LLC (BMW) agreed to pay $1.6 million and offer jobs to aggrieved African-American former employees and applicants. BMW had already voluntarily changed its criminal conviction policy.

The EEOC filed suit against BMW in 2013 claiming that BMW’s criminal conviction policy was not job related and consistent with business necessity and disproportionately screened out African Americans from employment. BMW used a contractor to provide logistics services at its facility in South Carolina. The workers who provided services to BMW were subject to criminal background checks consistent with the contractor’s policy, which reviewed only convictions from the prior seven years. When BMW switched contractors, the workers were told that they would need to re-apply for employment with the new contractor, and BMW instructed the new contractor to perform criminal background checks on all workers under BMW’s policy. BMW’s criminal convictions policy had no time limitation, excluding from employment all applicants with convictions in certain categories of crimes without regard to whether the conviction was a misdemeanor or felony, the age of the conviction, or the nature or gravity of the individual crime. One hundred incumbent workers, eighty percent of whom were African American, did not pass BMW’s inflexible criminal background check, including many who had worked for BMW for a number of years. All of these workers were denied employment with the new contractor.

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New Developments for Federal Contractors – New Executive Order on paid sick leave, final rule on pay transparency and new veterans benchmark

Paid Sick Leave

In conjunction with the Labor Day holiday, President Obama signed a new Executive Order requiring paid sick leave for employees of federal contractors and subcontractors. This executive order comes on the heels of a patchwork of state and local paid sick leave laws and failed efforts to enact any federal paid sick leave law for all employers. The Executive Order applies only to federal contractors and subcontractors—not other employers. It will take effect for covered contracts or subcontracts entered into or awarded after January 1, 2017.

This paid sick leave may be used for the employee’s own physical or mental illness, diagnosis or preventative care, care for a family member, or by victims of domestic violence, sexual assault, or stalking (including for any related counseling, relocation, or legal action). The definition of family member under the executive order includes persons in relationships equivalent of family relationships, not just blood relatives and spouses. Employees receive 1 hour of paid sick leave for every 30 hours worked (or up to 7 days or 56 hours per year). Unused sick leave will roll over from year to year and must be reinstated for any employee who quits or is separated and is rehired within 12 months of separation. Accrued paid leave is not required to be paid to employees upon termination. Leave must be requested 7 days in advance or as soon as practicable (for unpredictable leave). Employers may request certification for leaves of absence of 3 or more days, and employees have 30 days to provide the certification. No documentation is required to substantiate sick leave of less than 3 days.

Pay Transparency

The final rule on pay transparency prohibits federal contractors and subcontractors from discharging, or otherwise discriminating against, employees or applicants who inquire about, discuss, or disclose their compensation or the compensation of other employees or applicants. This prohibition is broader than the requirements of the National Labor Relations Act, enforced by the National Labor Relations Board (NLRB) because it applies to both non-management and management employees.   There is an exception for employees or applicants who make disclosure based on information learned by an employee in the course of his/her essential job functions (such as human resources, payroll, or benefits employees). This prohibition must appear in the EEO clause in federal contracts and subcontracts. A similar nondiscrimination clause must appear in employee handbooks and be disseminated to employees and applicants. Employees and applicants can make discrimination complaints with the Department of Labor if they believe they were discriminated against based on discussing, disclosing, or inquiring about pay.

This Final Rule, implementing EO 13665, takes effect on January 11, 2016 for contracts and subcontracts in excess of $10,000.

New Veterans Benchmark

OFCCP revised the veterans hiring benchmark from 7.2% to 7.0%. Federal contractors and subcontractors using the benchmark for 2015 affirmative action plans can begin using the lowered benchmark.