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Cases involving an equal opportunity harasser are usually entertaining, but Colston v. Cleveland Public Library, (6th Cir. Apr. 15, 2013) is also educational because it demonstrates how an employer can properly get rid of an equal opportunity harasser and defeat discrimination and harassment claims based on the harasser's conduct at the same time.

Plaintiff Mary Jane Colston was, and still is, a union security officer with the Cleveland Public Library ("CPL"). Ms. Colston alleged that the CPL, along with several of its employees, sexually harassed her, retaliated and discriminated against her because of her gender, and was liable to her for intentional infliction of emotional distress. She also charged the CPL with negligently hiring Melvin Abrams, the CPL's former Assistant Chief of Security, against whom the bulk of Ms. Colston's allegations were ultimately directed. The CPL and the individually-named defendants prevailed on all claims at the district court and Sixth Circuit court levels.

Here is what I found most interesting about this case. A person who harasses everyone, male or female, is not harassing or discriminating against someone because of gender. The standard for gender discrimination under Title VII and the Ohio Civil Rights Act, Ohio Revised Code 4412.02 is that to be actionable, the verbal or physical harassment must be "because of sex." Similarly, to establish a hostile work environment, a plaintiff must demonstrate that the harassment was "based on sex." In other words, a plaintiff seeking protection under the discrimination laws must affirmatively establish that he or she was "treated differently than similarly situated" individuals because of gender. If the same demeaning or derogatory conduct is directed at men and women alike, it is not "because of" or "based on" gender and is not actionable.

Ms. Colston cited a few different ways she suffered discrimination and/or a hostile work environment, but none were deemed actionable. Ms. Colston claimed that Mr. Abrams engaged in "unprofessional" behavior by using insulting and profane language and made comments about her physical appearance. Now, if Mr. Abrams had been speaking just to Ms. Colston, referring to just Ms. Colston's physical appearance, or using a gender-specific epithets like "bitch," the courts may have upheld these claims, but that is not what happened. Here, Ms. Colston admitted that Mr. Abrams was insulting and profane to all officers, male and female, and referred to them as "imbeciles" and "idiots," and that he commented on their personal lives and about their manliness and weight. Ms. Colston testified that Mr. Abrams "just basically emasculated the men right in front of me" and that he repeatedly made comments about the physical appearance of other male officers, including that they were overweight and looked sloppy in their uniforms. The good news for Mr. Abrams, and in turn the CPL, is that the courts found that no discrimination against Ms. Colston because of her gender and found that she was not subjected to an unlawful hostile work environment based on her gender.

The bad news for CPL is that it had a rogue, equal opportunity harasser – a bully – on its hands.

But...because it properly addressed the conduct of its equal opportunity harasser, it also defeated the remainder of Ms. Colston's claims. With respect to Ms. Colston's hostile work environment claim, the evidence demonstrated that every time Ms. Colston complained about Mr. Abrams, the CPL responded immediately with an investigation into the matter, which resulted in disciplinary action. In fact, after Ms. Colston’s first complaint, the CPL hired an independent investigator to investigate, which resulted in a five-day unpaid disciplinary sanction for Mr. Abrams. The second time Ms. Colston complained, the CPL hired another independent investigator to investigate.  That investigation led to Mr. Abrams being placed on administrative leave; however, he resigned before his pre-termination hearing. Because the CPL properly responded to all of Ms. Colston's complaints, the courts determined that she could not support a claim for hostile work environment.

The Takeaways: This case provides guidance to employers about how to properly respond to complaints of discrimination and harassment. In the event an equal opportunity harasser is identified, it is important that the employer investigate, document and discipline. Taking these steps promptly will help an employer not only identify and get rid of an equal opportunity harasser, but they will help protect against discrimination/harassment claims based on the equal opportunity harasser's conduct.

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Federal contractors and subcontractors should take notice that, in the last couple of years, the Office of Federal Contract Compliance Programs (OFCCP) has been pursuing a much more aggressive enforcement and regulatory agenda. Final revised rules on disability and veterans affirmative action are expected soon. Later in 2013, proposed new rules for construction contractors and gender discrimination are expected. We will post to this blog when these are available.

As we are awaiting these new regulatory frameworks, it should be noted that OFCCP has also been conducting more in depth and more aggressive compliance evaluations of federal contractors and subcontractors. Of note, OFCCP recently abandoned its prior framework for analyzing pay discrimination in favor of a much more flexible approach that permits it greater latitude in analyzing potential discrimination and in requesting documentation and data. [INSERT (See our recent post: OFCCP Signals Formal Change of Course on Pay Discrimination.)

Also of note, OFCCP’s planned compliance evaluations for fiscal year 2013 (October 1, 2012 – September 30, 2013) represent a significant 12% increase from fiscal year 2012. Consider this data on the number of compliance evaluations conducted or planned:

Also, OFCCP is boasting that the compliance evaluations it conducts today are much more in depth. From 2010 to 2011, OFCCP reported a 36.7% increase in audits closed with a financial remedy. For example, OFCCP recently released a press release regarding a $439,538 back pay settlement for nearly 2,000 female job applicants involving a subsidiary of Hormel Food Corp. (Clougherty Packing Co. – “Dodger Dog” hot dogs). The Company must also offer positions to 700 affected women applicants as positions become available.

With most contractors finalizing their calendar year 2013 Affirmative Action Plans and executing recruiting and outreach efforts for 2013 at this time, it becomes more important than ever to pay critical attention to affirmative action given the OFCCP’s recent activity.
 

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All too often it seems employers are entirely unaware of the steps they can take to proactively protect themselves from employment litigation. Instead, employers and their attorneys do not address potential issues until litigation has actually been threatened or filed, by which time preventative measures have likely become a moot point. Yet, the law is providing more and more innovative opportunities to strategically protect an employer in ways much cheaper than actual litigation. This protection can reduce an employer’s potential monetary exposure for labor and employment matters by either minimizing litigation or by placing an employer in a position of greater strength should litigation arise.

Written agreements signed by new hires is one of these innovative opportunities. Most employers are undoubtedly aware of the basic written agreements for new hires. For example, a written authorization to deduct from the employee’s final paycheck any debts owed to the company or the value of any company property not returned at termination. Another common example includes a basic non-disclosure agreement prohibiting the employee from disclosing the employer’s confidential information both during and after employment (including the all-important fee-shifting provision if an employer successfully pursues a claim against an offending employee). Some employers may also be aware of the more advanced examples such as continuing (as opposed to one-time) authorizations for background checks or a non-competition agreement. Finally, only a slim number of employers may be aware of one of the most advanced examples; namely, a statute-of-limitations waiver reducing the time to file a lawsuit under Ohio’s anti-discrimination law from six years to six months.

These examples just scratch the surface of how employers can use written agreements with new hires to protect themselves from litigation, unfair competition, and the a myriad of other issues that arise under federal, state, and local law. One new option that has now become increasingly available for employers is the class action waiver and arbitration agreement.

The current impetus for these types of agreements comes from the U.S. Supreme Court’s decision in AT&T Mobility LLC v. Concepcion, 131 S.Ct. 1740, 179 L.Ed.2d 742 (2011). There, the high court upheld an agreement between AT&T and a customer requiring claims by the customer to be arbitrated and requiring the customer to waive his or her right to a class action. The AT&T agreement also had a number of clever provisions strategically designed to reduce the cost and expense of any legal dispute. Specifically, (1) a requirement that the customer provide AT&T with 30 days to provide an offer of settlement before the customer could file for arbitration, (2) a requirement that AT&T need only pay arbitration costs for non-frivolous claims, (3) a provision stating that for claims of $10,000 or less, the customer may choose a form of expedited arbitration where the case could be heard via telephone or based upon written submissions only, and (4) a provision stating that either party could proceed in the very inexpensive and quick small claims court in lieu of arbitration.

Management-side labor and employment attorneys have built upon Concepcion’s approval of class action waiver and arbitration agreements. They have done so by incorporating the waiver and arbitration provisions into employment agreements with the specific purpose of avoiding class actions or collective actions (i.e., the Fair Labor Standards Act’s version of a class action) that can create substantial monetary risk for an employer. In particular, class action waivers and arbitration agreements can try to minimize that risk even where an employer admittedly erred under the law.

Take, for example, an employer who clearly failed to comply with the Worker Adjustment Retraining and Notification Act (WARN), which requires a covered employer to provide 60 days’ notice or 60 days’ pay to employees suffering what the law defines as a “plant closing” or a “mass layoff.” If one employee files suit alleging a violation of the WARN Act, the liability on back pay is 60 days’ worth (plus, of course, any penalties, costs, or attorneys’ fees available under WARN). However, if that employee files a class action, and there were 300 employees terminated and not provided notice or pay, then all of a sudden the employer is facing liability 300 times greater than on the individual claim. The other 299 employees may have never even thought to consult an attorney and may have never brought a lawsuit against the company, but because one employee did consult an attorney who filed a class action all 300 employees (assuming class certification by the court) are now all pursuing claims against the employer.

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This blog post was co-authored by Margaret M. (Peggy) Koesel and Tracey L. Turnbull.

A company may discard data, documents or records in the ordinary course of its business. But routine destruction of information that may be relevant to a government investigation or a lawsuit must be suspended and information must be saved as soon as possible after a party has notice that it must preserve evidence. A recent case from the district court for the Southern District of Ohio looks at the events that triggered a bank’s duty to save particular data considered relevant by its opponent and the consequences of its failure to stop the routine purging of that data on a timely basis.

In E.E.O.C. v. JP Morgan Chase, No. 2:09-cv-00864, the Equal Employment Opportunity Commission claimed that a bank treated a class of female mortgage consultants differently than their male counterparts by, among other things, directing more lucrative calls in the call queue to male employees based on the skills it assigned to each individual mortgage consultant. In an effort to establish this theory, the Commission asked the bank to produce “skill login data” for a five-year time period, claiming that a statistical analysis of that data would show discrimination.

After a disagreement over the scope of the data to be produced, the court ordered the bank to produce data from July 2006 to December 2009. But the bank had failed to preserve some of that data, allowing it to be purged as part of its routine destruction of any data of that kind that was over three years old. The bank’s destruction of ten months of the data led the Commission to request sanctions.

The court first focused on the pre-lawsuit events that triggered the bank’s duty to preserve the data because sanctioning the bank for destroying the data before it had notice it was required to save it would not be appropriate. The court pointed to a number of pre-lawsuit notices from the Commission that the bank should have known triggered its duty to suspend the bank’s automatic purging process, long before the Commission filed a class action lawsuit. These events included a notice from the Commission that it was investigating class allegations, a request for information from the Commission concerning allegedly unfair call distribution, and a class-wide cause determination, all of which the bank received before it started its automatic purge of the relevant data. The district court also found it “curious” the bank recognized that it should save the email of the female mortgage consultants while the charge of discrimination was pending, yet it took no steps to safeguard the login data at the same time. That failure ultimately allowed data from July 2006 to September 2007 to be automatically destroyed.

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The Sixth Circuit Court of Appeals reversed the Michigan district court's ruling in Keith v. County of Oakland, finding a deaf applicant's rights under the Americans with Disabilities Act ("ADA") may have been violated when Oakland County ("the County") revoked its job offer to hire him as a lifeguard.

Nicholas Keith, who was born deaf, trained and successfully completed the County's lifeguard training program in 2007. After receiving his lifeguard certification, Keith applied for a lifeguard position at Oakland County's wave pool. The job announcement required each applicant be at least 16 years of age and pass the County water safety test and lifeguard training program. The announcement also included a condition of employment which stated, "[a]ll persons hired by Oakland County must take and pass a medical examination from a county-appointed physician, at no cost to the applicant."

Recreation specialist Katherine Stavale offered Keith a part-time position and scheduled his medical examination. Keith and his mother met with Dr. Paul Work, D.O. shortly thereafter. Upon entering the examination room, Dr. Work stated, "[h]e's deaf; he can't be a lifeguard." Mrs. Keith asked, "[a]re you telling me you're going to fail him because he is deaf[?]". Dr. Work responded, "[w]ell, I have to." Dr. Work informed Ms. Stavale that Keith could not function independently as a lifeguard...unless he was "constantly accommodated."

After receiving Dr. Work's report, Ms. Stavale placed Keith's employment on hold, and contacted the client manager for aquatic safety and risk management. Ms. Stavale was directed to perform a job-task analysis to determine whether Keith could perform the job with or without reasonable accommodation. After preparing an outline of potential accommodations, Ms. Stavale concluded that Keith would successfully integrate into the lifeguard position. After reviewing Ms. Stavale's memo, the client manager still did not believe Keith could perform the job. Based on the advice from the client manager, Ms. Stavale revoked the offer of employment.

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In a recent decision in Chenzira v. Cincinnati Children’s Hospital Medical Center, Case No. 1:11-cv-00917, the U.S. District Court for the Southern District of Ohio in Cincinnati held that sincerely held beliefs in veganism could plausibly be considered religious beliefs protected against religious discrimination under Title VII of the Civil Rights Act of 1964 and Ohio state law. The Court rejected the argument that veganism was merely a social philosophy or dietary preference.

Sakile Chenzira was a customer service representative for Cincinnati Children’s Hospital for over 10 years. In 2010, the Hospital terminated Chenzira for her refusal to be vaccinated for the flu. As a vegan, she objected to flu shots because the flu vaccine is grown in chicken eggs, and vegans do not ingest any animal product or byproduct. Chenzira requested a religious accommodation to be excluded from the vaccine requirement but was denied and terminated. Prior to 2010, the Hospital had accommodated her request to forgo the flu vaccine.

Chenzira sued, alleging religious discrimination under Title VII and Ohio Revised Code (O.R.C.) Chapter 4112, as well as wrongful discharge in violation of public policy. The Hospital moved to dismiss. The Hospital argued that veganism is not a religion, but rather, a social philosophy or dietary preference not entitled to protection under Title VII or O.R.C. Chapter 4112. The Hospital relied on the Sixth Circuit’s decision in Spies v. Voinovich, 173 F.3d 398, which denied a prisoner abuse claim related to prison food based on the inmate being a Buddhist vegetarian. The Hospital also argued that her claim was barred because Chenzira failed to file her charge with the EEOC within 300 days of her termination, waiting 309 days after her termination to file the charge. The Hospital moved to dismiss the public policy/wrongful discharge claim on the grounds that Title VII and O.R.C. Chapter 4112 adequately provide a remedy for religious discrimination.

Judge S. Arthur Spiegel held that veganism may be entitled to protection as a religion because the definition of “religious practices” in EEOC regulations (29 C.F.R. § 1605.1) “include[s] moral or ethical beliefs as to what is right and wrong which are sincerely held with the strength of religious views.” He also gave some credit to Chenzira’s citation of biblical passages supporting veganism and Chenzira’s citation to them in requesting a religious accommodation from the Hospital. He also noted that it lends credence to her position that veganism is a religious belief because others espouse similar beliefs. Judge Spiegel distinguished the Sixth Circuit decision in Spies on the ground that the inmate’s dietary request was adequately met by providing a vegetarian diet, as the inmate himself conceded that a more restrictive vegan diet was not a requirement of his Buddhist faith. The Court did caution that it was only holding that it was “plausible” that Chenzira’s veganism was a religious belief entitled to protection under the law, not that she actually set forth a claim of religious discrimination. At the conclusion of discovery, her case still has to withstand a summary judgment challenge, which will not be based on the liberal “plausibility” standard.

As for the charge filing requirements, the Court held that her EEOC charge was timely filed because her EEOC intake questionnaire was completed within 300 days and was sufficiently detailed to be construed as a request for remedial action. It was clear from her intake questionnaire that she intended to file a charge and sought government assistance in remedying her situation. The Court relied on a 2008 U.S. Supreme Court decision, Federal Express Corp. v. Holowecki, 552 U.S. 389, holding that an intake questionnaire can be construed as a “charge” if it expresses intent to: file a charge, seek remedy with the EEOC, and notify the employer of the accusations (including all identifying and contact information for the employer).

The Court did dismiss the wrongful discharge claim as barred because Title VII and Ohio’s civil rights statute (O.R.C. Chapter 4112) adequately protect against religious discrimination.

As the title of this post makes clear, employers should be careful in immediately dismissing non-mainstream beliefs as not entitled to protection under federal and state law. The Court in Chenzira reaffirmed that the law protects moral and ethical beliefs not traditionally thought of as “religions” if they are held with the strength of religious views.
 

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In Dixon v. Univ. of Toledo et al., the Sixth Circuit Court of Appeals has held that a high-level human resources official who writes publicly against the policies her government employer charges her with creating, promoting and enforcing, is not engaging in protected speech. Crystal Dixon, an African-American woman, who was the acting Interim Associate Vice President for Human Resources at the University of Toledo ("the University") when she penned a riveting op-ed column rebuking comparisons between the civil-rights and gay-rights movements. The piece ultimately led to her termination.

On April 4, 2008, Toledo Free Press Editor-in-Chief Michael Miller wrote an editorial titled "Gay rights and wrongs." In his piece, Miller compared the gay rights movement to the civil rights movement and expressed concern that Medical College of Ohio employees who became University of Toledo employees following a 2006 merger were not offered domestic-partner benefits that were available to other University employees. Dixon responded to Miller's piece with her own op-ed column, "Gay rights and wrongs: another perspective," on April 18, 2008. Dixon rejected Miller's comparisons of the gay-rights and civil-rights movements stating,

"[a]s a Black woman who happens to be an alumnus of the University of Toledo's Graduate School, and employee and business owner, I take great umbrage at the notion that those choosing homosexual lifestyle are 'civil rights victims.' Here's why. I cannot wake up tomorrow and not be a Black woman. I am genetically and biologically a Black woman and very pleased to be so as my Creator intended. Daily, thousands of homosexuals make a life decision to leave the gay lifestyle as evidenced by the growing population of PFOX (Parents and Friends of Ex Gays) and Exodus International just to name a few...."

Dixon also responded to Miller's comments regarding health insurance, stating, "[t]he reference to the alleged benefits disparity at the University of Toledo was rather misleading....To suggest that homosexual employees on one campus are being denied benefits avoids the fact that ALL employees across the two campuses regardless of their sexual orientation, have different benefit plans."

Dixon was placed on paid administrative leave on April 21, 2008, as a result of her op-ed column. President Jacobs wrote a guest column in response to Dixon's op-ed column, on May 4, 2008. Jacobs repudiated Dixon's opinion on behalf of the University and emphasized the University's position on diversity. Jacobs also highlighted the various programs at the University aimed at expanding and supporting diversity.

Dixon's disciplinary hearing was held on May 5, 2008. Dixon read a prepared statement reiterating the beliefs stated in her op-ed column, and she stated she was speaking as a private citizen. She also claimed she had never discriminated based on sexual orientation, and accused the University of treating her differently than other employees. President Jacobs issued a termination letter to Dixon on May 8, 2008.

On December 1, 2008, Dixon filed suit in the U.S. District Court against the University, President Jacobs, and Vice President for Human Resources and Campus Safety William Logie, alleging First Amendment and other violations. The District Court granted the Defendant's motion for summary judgment. Dixon filed an appeal to the Sixth Circuit Court of Appeals.

The Court analyzed Dixon's claim of First Amendment Retaliation specifically focusing on whether her speech was protected. Dixon needed to show the following: 1) her speech touched on a matter of public concern; 2) that under the balancing test announced by the U.S. Supreme Court in Pickering v. Board of Education, her "free speech interests outweigh the efficiency interests of the government as employer"; and 3) that the speech was not made pursuant to her official duties." The parties agreed Dixon was speaking on a matter of public concern, but the University argued Dixon could not satisfy the Pickering requirement, and was speaking in her official capacity.

The University argued Dixon's speech fell within the presumption set forth by the Sixth Circuit Court of Appeals in Rose v. Stephens, which states "where a confidential or policymaking public employee is discharged on the basis of speech related to his political or policy views, the Pickering balance favors the government as a matter of law." The evidence established Dixon was delegated appointing authority and was responsible for recommending, implementing, and overseeing policy. Moreover, Dixon's comments implying that homosexuals should not be afforded the same protections as African-Americans is in direct contradiction to several University policies developed and promoted by the Human Resources Department. The Sixth Circuit found the University's interests outweighed Dixon's interest as a matter of law and affirmed the district court's grant of summary judgment.

Reminders
Government employers should understand that the First Amendment will not prevent them from disciplining employees serving in policy-making positions for public speech that contradicts the employer's policies. Such employers, however, should be careful to consider the disruption caused by the employee's speech before taking disciplinary action. 

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Gaglioti v. Levin Group, Inc. (6th Cir. Dec. 13, 2012), serves as a good reminder to employers to pin down their reasoning for terminating an employee at the start, and stick to it. In addition, all reasons for terminating an employee should be included in the termination meeting with the employee, or at the very least, at the EEOC charge stage, even if it might bruise the employee's ego. Any change or supplementation to the original reason can make put the entire termination decision seem made up and send the employer to trial. It is also imperative that employers know what their policies say.

In 2008, Levin Group hired Joseph Gaglioti as a staff accountant. Gaglioti was hired with full benefits, though the company claimed Gaglioti was hired as a temporary employee and his work limited to immediate projects. As part of his hire paperwork, Gaglioti filled out a medical insurance form and disclosed his wife's significant medical problems. The next year, Gaglioti filled out a new medical history form in connection with Levin Group's medical insurance plan renewal like all full time, benefit-eligible employees, and again, disclosed his wife's medical condition. While Gaglioti claimed he gave the form to the Comptroller's assistant, the Comptroller and the President claimed they never saw it. The next month, Gaglioti was informed he was being terminated. The reason given to him —and confirmed in an email — was that he was a temporary employee, and there was no work for him. During litigation, the President would supplement this and testify that Gaglioti's work was poor, and that he had decided to terminate Gaglioti in "early 2009". Notably, the record devoid and any evidence indicating that Gaglioti's performance had ever been an issue.

Gaglioti sued Levin Group for age and disability discrimination under state and federal law. He also sued for ERISA interference, but that claim will not be discussed here. The district court granted summary judgment for the employer on all claims and dismissed the suit.

Gaglioti's Age Discrimination Claims

The Sixth Circuit did not entirely agree with the district court. The court analyzed both claims under the McDonnell Douglas tri-partite burden shifting framework. With respect to his age discrimination claim, the court found that Gaglioti met his prima facie burden, which required that he show he was over the age of 40, discharged, qualified for the position, and replaced by or that his discharge permitted the retention of, a person outside the protected age class. Plaintiff easily met the first three elements. The more contentious element was the fourth as the evidence revealed that after Gaglioti's termination, Levin Group retain two younger staff accountants in a permanent role. This was sufficient for Gaglioti to meet his burden on the fourth element and move the case forward.

Turning to the employer's burden of persuasion, i.e., to identify a non-discriminatory reason for terminating Gaglioti, Levin Group offered three reasons: (1) Gaglioti's position was always intended to be temporary, and Gaglioti was terminated when his temporary assignment was completed; (2) there was no work for Gaglioti to do, meaning his termination was essentially a downsizing; and (3) that Gaglioti's performance was sub-standard.

To prove pretext, Gaglioti took issue with the all three reasons given by Levin Group. First, Gaglioti argued that each of Levin Group's three reasons were, at one point, asserted as the Company's sole reason for terminating him. His theory was that the Company had changed its reasons for firing him during the course of the litigation. The evidence demonstrated that at Gaglioti's termination, the sole reason given to him for his termination was the temporary nature of his position. At the EEOC stage, however, Levin Group claimed Gaglioti was terminated because there was no future need for Gaglioti's services — there was no mention of any performance issues. At the summary judgment stage during litigation, however, the Company argued that it was the combination of poor performance and temporary employment that caused it to terminate Plaintiff. The court found that the "moving-target nature of Levin Group's explanation ..., while perhaps casting a pall of suspicion over it actions" was not, by itself, enough to create an issue of fact because the Company's story was one that was "supplemented" rather than changed.

What did the employer in was its failure to pay attention to its own policies. Levin Group's employee manual defined "temporary employee" as one that did not get benefits, but Gaglioti did. With this, the court found that the evidence contradicted Levin Group's claim that Gaglioti was a temporary employee, and noted that this, "coupled with the prima facie evidence" that the employer retained two younger employees after Gaglioti was terminated, could lead a reasonable jury to conclude that this "'temporary employee' justification was crafted post hoc by [the Comptroller and the President] to cover an improper reason for firing him."

Other inconsistencies with Levin Group's story were also no help. For example, Levin Group argued that there was no work for Gaglioti to do, but the accounting department was larger when Gaglioti was terminated than when he was hired. And let's not forget, Levin Group hired two younger people on a full-time basis after it terminated Gaglioti. Then there's the issue of Gaglioti's performance ... of which there was zero documentation and no mention of any performance issues until after litigation ensued. The court noted that while the fact that the employer did not raise the issue of Gaglioti's performance until well into litigation "may not be enough to show a changing rationale, it would allow the jury to view the performance argument as a litigation strategy, as opposed to the real reason for the action." The court reasoned that this was "potentially enough for a jury to discount this argument." It also did not help that the Comptroller testified that Gaglioti's work performance "didn’t have anything to do with why he was fired" since inconsistent reasons given by key decision-makers can provide evidence of pretext. With this, the Sixth Circuit reversed the trial court and remanded the case on Gaglioti's age discrimination claims.

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So the question on everyone's mind when it comes to holiday parties: Will alcohol be served? For employers this is a big decision and, depending on where the holiday party is held and how it is contained, one that may come to expose an employer to liability. For the most part, whether an employer can be held responsible for alcohol-related incidents at or after company-sponsored events depends on the state in which the party is held and the circumstances.

First things first: If the event involves a business purpose that can be considered to have a direct effect on the commercial profitability of the business or if attendance is mandatory, the employer could find itself exposed to liability, so it is important to make attendance optional. Normally, however, merely attending an employer sponsored party will not expose the employer to liability for injuries that an intoxicated employee may cause once away from the premises.

In Ohio specifically, a social host, (i.e., the employer, in the case of an office holiday party) who provides alcohol on company premises is typically not liable to a third person subsequently injured by the intoxicated person. Ohio courts have refused to impose liability on a social host in a situation where a guest becomes intoxicated and injures a third party. Specifically, in Settlemeyer v. Wilmington Veteran's Post No. 49, 11 Ohio St.3d 127 (1984), the Ohio Supreme Court has held that a social host is not liable for injuries to a third-party that occur as a result of the negligence of an intoxicated social guest. Settlemeyer has been applied in the employer-holiday party context and been found controlling. See Gilkey v. Gibson, No. 98AP-1570, 2000 WL 4973 (10th App. Dis. Jan. 6, 2000); Knox v. Bell Optical Lab, Inc., No. 1145, 1989 WL 126857 (1st App. Dis. Oct. 24, 1989). In this context the courts typically have reasoned that the proximate cause of the injury is the consumption of the alcoholic beverage itself, not the act of furnishing the beverage. This is especially true when it concerns an adult guest; it’s a little different for minors, as set forth below. If the event is held at a restaurant or off-site, the vendors selling/providing the alcohol for profit may be liable for resulting injuries to third parties if they provide alcohol to noticeably intoxicated guests; however, the employer sponsoring the event generally has no liability.

When minors are involved, Ohio courts in some instances have found a furnisher of alcohol liable for injuries to a third person as a result of an intoxicated guest’s actions. These instances include cases where a person under 21 is provided beverages and when a liquor license holder knowingly violates the law relative to the sale of alcoholic beverages. In each such instance, the courts have determined that by enacting specific statutes that forbid the furnishing of alcohol to minors, the legislature meant business. Because these instances constitute statutory violations, Ohio courts have imposed liability on the social host and/or license holder in the event that the intoxicated minor causes injuries to a third party.

A minority of the states have adopted social host liability, in order for an employer to be found liable in one of these states, typically there must be an affirmative showing that the social host served alcohol to a person when the host knew or should have known that the person was intoxicated, and further knew that the intoxicated guest would be driving away from the event.

The problem for employers, even those in Ohio where there is no social host liability typically, is that there is no law that prohibits an intoxicated adult from suing a social host for injuries to that adult guest as a result of the intoxication. This means that if something happens to an employee or someone else due to the actions of an employer who became intoxicated at a company holiday party, the employer can still be named as a defendant in a lawsuit and spend money defending the suit.

If you decide to have alcohol at your company holiday party, here are some steps that might lessen the possibility of being held responsible for an employee's conduct after drinking too much:

• Don't Serve Minors: Make sure no minors are served. Check IDs, pass out wrist bands, and post signs that guests must be 21 in order to consume alcohol beverages. If fraternities can do it, so can you.
• Be Aware of Your State Law: Be familiar with your state’s laws regarding liability and alcohol at company-sponsored events.
• Make Attendance Optional: Make it clear to employees that attendance at a company-sponsored event is purely optional, not mandatory. This also means, keep the itinerary for the event social, not work related. Keep work-related events, like handing out of bonuses/awards or discussing yearly goals, for another day.
• Remind Employees of Policies: Remind employees of your policies regarding proper decorum. While you can encourage them to have fun, remind them that they are expected to act responsibly, which includes not drinking too much and then driving. With this, also remind salaried-exempt managers to keep an eye on employees even though technically it's not work time.
• Limit Consumption: Use a cash bar or drink ticket system to limit alcohol consumption.
• Take it Outside: Have the party at an off-site restaurant, party hall or hotel where the facility will serve the drinks. This will reduce the risk o employer liability. If the party is on-site, at a minimum hire a professional wait staff or bartenders so the alcohol is being served by non-company employees. Ask the bartenders/caterers to prepare low-alcohol mixed drinks or punches that look and taste as festive as their high-alcohol content counterparts. DO NOT have managers/supervisors/co-workers making and serving their colleagues/subordinates beverages.
• Be Careful with Your Choice of Beverages and Food. Provide a variety of non-alcoholic beverages and plenty of food. Stay away from sweet punches that contain alcohol, which make it difficult for employees to monitor how much alcohol they are consuming. Go easy on the greasy, salty or sweet foods, which tend to make people thirsty, and serve starchy and protein-heavy foods that slow the absorption of alcohol into the bloodstream. If possible, serve appetizers that are easy to eat while standing and mingling. Employees who have to choose between holding a drink and holding a plate of food may choose the drink only.
• Close the Bar Early: Close the bar well before the end of the event, no less than a half hour, but keep serving food.
• The More the Merrier: Consider opening the party to spouses/partners/significant others, which tends to reduce alcohol intake in addition to providing a possible designated driver.
• Plan Ahead: Discuss transportation ahead of time with employees and encourage them to coordinate rides with designated drivers. Another option: Arrange for taxis, a shuttle, or other transportation at the company's expense. Let employees know that transportation options are available so they can plan ahead. Announce during the party that transportation is available, even for employees who did not make an advance request.

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Religion is also a hot-button workplace issue in December because so many different religious groups celebrate different holidays in December. For example: Christians commemorate the birth of Jesus at Christmas; Buddhists celebrate Buddha's Enlightenment with Bodhi Day; Jewish people celebrate Hanukkah, the Festival of Lights; African-Americans celebrate Kwanzaa, Muslims celebrate Eid al-Adha, or the Feast of Sacrifice; Seinfeld enthusiasts celebrate Festivus, and there are many others.

Federal and state laws prohibit discrimination and/or harassment on the basis of religion. This means that an employer cannot treat persons of different religions differently or appear to favor one religion over another. As such, having a party that is focused on a single religious theme, i.e., a "Christmas" party, excludes employees who do not practice Christian beliefs. As such, employees should be mindful of varying cultural differences among their employees and determine a neutral way to celebrate this special time of year. Here are some tips:

• Keep Decor Wintery, Not Religious-Centered: In the office, its goodbye to the Christmas tree, the nativity scene and the menorah. Unless you allow all types of religious symbols during the holidays, its best to deck the halls with neutral themes, like wintery snowmen, snowflakes and colorful lights.
• Give Peas a chance! Some religious observances restrict diets or require fasting during certain periods. Do what you can to avoid holiday parties during times of fasting and offer food options that are sensitive to various religions and nationalities that are likely to be represented at your party.
• Music Makes the World Go Round: Music sets the tone of the party, and if done wrong your party can have two left feet. Music can be tough, especially with a workforce of varying ages, cultural backgrounds and/or religious beliefs. One suggestion is to avoid overly religious Christmas carols.
• Foster an Atmosphere of Inclusion not Cliques: Take steps to keep employees from hanging out with their workplace friends. Encourage employees to mix and mingle by assigning seats randomly and/or have everyone engage in an activity, like a gift exchange. Most importantly, make sure everyone feels welcome and included. Holiday parties should promote office morale and bolster workplace cohesion, not remind employees of high school.

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As much as everyone loves them, the holidays create increased risk of employer liability and can result in a long list of legal problems for an unprepared employer. As our holiday gift to you, we've put together our top five holiday headaches for employers, which will be provided to you in a week-long series starting today.

Numero uno on our list: Sexual harassment at the office holiday party. Who doesn't have at least one inappropriate office holiday party story? If you don't, you've at least heard a couple doozies. The mix of sparkly outfits, tasty snacks, free-flowing libations and people who typically spend their working hours together and you have a recipe for jaw-dropping, not to mention, litigious situations. For example, there's the uncomfortable flirtation, the inappropriate comment about someone's appearance or outfit, the misconstrued invitation, and the just-asking-for-problems mistletoe decoration, which should never be featured at a holiday party. And lest we forget, there is a whole host of problems that ensue when the office Santa keeps asking female employees to sit on his lap.

Holiday-related sexual-harassment lawsuits are not new and not unusual. Under federal and state law, employers have a legal obligation to prevent harassment in the workplace. This duty extends to work-sponsored events, like holiday parties and even extends to the appropriateness of gifts for a holiday gift exchange. When it does not abide by this duty, an employer can be vicariously liable for employee behavior that concerned sexual harassment committed in the course of employment. There is a bright side: generally, employers will not be vicariously liable for the actions of its employees if it can demonstrate it took reasonable steps to prevent the sexual harassment or that the employee did not use the employer's complaint procedures to alert the employer of the problem. Some cases on this subject have addressed comments with suggestive innuendos and some have been more overt. Take Grigaliunas v. Rockwell Intern. Corp. (defended by our own Charlie Warner), where the plaintiff alleged a co-worker kissed her at a holiday party for example. While that employer was lucky enough to get the case thrown out early by showing it took reasonable steps to correct the problem when notified, some employers aren't so lucky, and in any event, it costs a lot of money to get the case tossed out.

No matter how well planned or well-intended and despite an employer's best efforts to train their employees, office parties tend to encourage employees to behave in odd ways. This is despite an employer's best efforts to train their employees. Thus, employers are advised to remind their employees, not only of the company's anti-harassment policy, but to remind them that it applies to employer-sponsored parties and events. Here are some other tips to help keep your office Santa off the real one's "Naughty List":

• Review, Update, Remind: Review your employment handbook and, if necessary, update it so it expressly notes that employees are subject to the employer's anti-harassment policy at company-sponsored events. Once reviewed and updated, remind employees of the company's anti-harassment and reporting policies. Let them know that the policies apply to social and non-social events inside and outside the office equally and that they will be subject to discipline if they are involved in harassment during the holiday party. Don't forget to make sure your employees know this applies to their social media activities too ... just in case one of them decides to make a co-worker's dance with the lampshade the new YouTube sensation.
• Take a Top Down Approach: Start at the top and remind supervisors of the company's anti-harassment policies and what to do if they learn of or witness potential harassment.
• Caution Gifting: If there is going to be a holiday party gift exchange, employers should inform employees that gifts should be workplace appropriate. If necessary, employers should expressly state that employees are not to bring gifts/cards that contain derogatory images, language, innuendos or otherwise humorous gifts to which someone might take offense.
• The More the Merrier: Consider inviting your employees' spouses/partners/families. Their presence may change the dynamic, in a good way, and keep the inappropriate conduct at bay.
• Dress for Success: Consider implementing a dress code that maintains a professional environment, e.g., instead of "holiday attire," which could mean sparkly tube tops to some, keep it "business casual."
• Act Fast: Should all else fail and you find yourself dealing with a sexual harassment issue, act promptly! All acts of sexual harassment, even those that occur at a holiday party, should be taken seriously and dealt with properly. This includes a proper investigation and implementation of disciplinary procedures as necessary.

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In Alexander v. Trilogy Health Services, LLC, The Southern District of Ohio held that an employer terminating two pregnant employees in two months--coupled with the close proximity in time between the terminations and the employer learning of the pregnancies--created an inference of pregnancy discrimination.

Tasha Alexander was a nurse at a retirement community in Cincinnati. In April 2010, she received a glowing performance review. Approximately one month later, she informed her employer that she was pregnant. A co-worker also announced her pregnancy around the same time.

In July and August 2010, Alexander was disciplined three times and issued a “final written warning.” Evidence was presented that, around this time, members of management stated that they wanted to get rid of Alexander and that they were trying to build a paper trail for her termination. Prior to her pregnancy announcement, she had received only one item of discipline, which was removed from her file due to the passage of time.

In August 2010, she experienced pregnancy-related high blood pressure and was unable to complete one workday and could not report to work on the following day. She called the employer and faxed a note from her doctor stating the reason for her inability to work. She did so, however, less than four hours before her scheduled shift, in violation of the employer’s attendance policy. Two days later, she requested FMLA leave. The employer called her the next day and suspended her pending an investigation for her violation of the four-hour notice rule. Eventually, she was terminated for job abandonment, only three months after announcing her pregnancy. She never completed any FMLA paperwork because of the suspension and never reported to the employer’s premises for an investigatory interview because her doctor had not cleared her to work. She also testified that she believed her termination was inevitable.

In addition, her co-worker who had also announced her pregnancy around the same time as Alexander was terminated after receiving several disciplinary actions after telling her supervisors about her pregnancy. There was evidence that the employer had stated that it was “concerned” that two employees were going to be on maternity leave around the same time because it would create staffing problems. In addition, Alexander was able to point to four non-pregnant employees who were not terminated after they were late or absent with less than four hours notice.

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By now, you should know that the Equal Employment Opportunity Commission ("EEOC") has issued “Guidance on the Consideration of Arrest and Conviction Records in Employment Decisions”, which is designed to restrict criminal background checks by employers, but you may not know that enforcement responsibility for the Fair Credit Reporting Act ("FCRA") has been transferred from the Federal Trade Commission to the recently created Consumer Financial Protection Bureau ("CFPB").

The FCRA, of course, is the federal law that imposes requirements on employers who use third party Consumer Reporting Agencies ("CRA's") to obtain “consumer reports" (i.e., background check, reference check, credit check) and "investigative consumer reports" (i.e., a consumer report where information regarding character, general reputation, personal characteristics, etc is obtained through personal interviews) on prospective or current employees.

What this means for employers is that they should expect heightened scrutiny on their FCRA compliance. The FCRA requires employers who use CRA's to do their background checks to go through a four-step process, using federally-mandated forms. One of the CFPB's first steps in its role as chief enforcer of the FCRA, was to revise that forms which employers must use, effective January 1, 2013.

The three notices the CFPB revised, which are available in Appendices K, M and N to 12 C.F.R. part 1022, are summarized as follows:

• A Summary of Your Rights Under the FCRA: CRAs must provide this form to employers and employers must provide this form to prospective employees and current employees when either will be subject to an investigative consumer report or when a pre-adverse action notice is sent.
• Notice to Users of Consumer Reports: Obligations of Users Under the FCRA: CRAs must provide this form to their employer-clients.
• Notice to Furnishers of Information: Obligations of Furnishers Under the FCRA: CRAs must provide this notice to certain furnishers of information.

The forms CRAs and employers are to continue to use until January 1, 2013 are available in Appendices F, G and H to 16 C.F.R. part 698.

Below is a summary of the four steps and, more helpful, how the CFPB's changes to the FCRA impact each step and when the new notices are required:

Step 1: Certification to the Consumer Reporting Agency

A CRA may furnish a consumer report for employment purposes only if the employer certifies to the CRA, among other things, that:

• It notified the prospective employee or current employee clearly and conspicuously and in writing that a consumer report is being requested for employment purposes;
• It obtained writing authorization from the prospective employee or current employee allowing the employer to obtain a copy of the report;
• It will use the information for a "permissible purpose" only, this includes employment purposes;
• It will comply with the conditions for adverse action should adverse action be taken against the applicant; and
• Information from the consumer report will not be used in violation of any applicable Federal or State equal protection laws or regulations.

Once a CRA is engaged to conduct a consumer report, it must provide their employer clients with a copy of the Notice to Users of Consumer Reports: Obligations of Users Under the FCRA.

Step 2: Notice and Authorization from the Applicant

Next, an employer must inform the prospective employee or current employee that it might use information in his or her consumer report for decisions related to employment. The employer must also obtain written permission from the prospective employee or current employee and this must be in a clear and conspicuous manner.

In addition to the obligations above, if the employer wants an "investigative consumer report," as defined above, it must also inform the applicant that an investigative consumer report may be obtained. This must be done in a written disclosure that is mailed, or otherwise delivered, to the prospective employee or current employee not later than three days after the date on which the report is first requested. The notice must clearly and accurately disclose to the applicant in writing that an investigative consumer report may be made. This disclosure must include a statement informing the prospective employee or current employee of his or her right to request additional disclosures of the nature and scope of the investigation, and must include the A Summary of Your Rights Under the FCRA and that, upon the written request of the applicant made within a reasonable period of time after the disclosures required above the user must make a complete disclosure of the nature and scope of the investigation that was requested. Should an prospective employee or current employee contact the employer in writing, and request information about the nature and scope of the investigative consumer report, the employer must supply this information within five days of the date on which the employer received the prospective employee or current employee's request or the date on which the report was requested, whichever is later.

Step 3: Pre-Adverse Action Protocol

If an employer might use information from a consumer report, in whole or in part, to take an “adverse action” — it must give the prospective employee or current employee (1) a copy of the report; and (2) a copy of A Summary of Your Rights Under the FCRA before taking the adverse action.

If, however, the consumer report does not influence the employer's adverse action in whole or in part, the employer has no duty to forward a copy of the report of a summary of consumer rights to the applicant at the pre-adverse action stage.

The rights as explained in A Summary of Your Rights Under the FCRA include giving the prospective applicant or current employee the opportunity to contact the employer and the CRA to dispute or explain information in the report that the prospective applicant or current employee believes is inaccurate or incomplete to give the prospective applicant or current employee the opportunity to see the report that contains the information that is being used against them. If the report is inaccurate or incomplete, the prospective applicant or current employee then has the opportunity to contact the CRA to dispute or explain what is in the report.

Step 4: Adverse Action Protocol

If, after waiting the requisite amount of time, the employer decides to take an adverse action (i.e., deny the applicant's application for employment or terminate an employee) it must inform the prospective employee or current employee orally (though this is highly discouraged) or in writing, which can be electronically, of the adverse action and of the following, statutorily required information, that includes:

• The name, address, and phone number of the CRA that supplied the consumer report;
• A statement that the CRA that supplied the information did not make the decision to take the adverse action and cannot give any specific reasons for it; and
• A notice of the employee's right to dispute the accuracy or completeness of any information in the applicant's report and to get an additional free report from the company that supplied the credit or other background information if the applicant requests it within 60 days.

Takeaways

• Get Ready to Change Your Forms. Before January 1, 2013, when conducting criminal screens of applicants and employees, employers should start using the new FCRA Summary of Rights when they: (1) provide the form with required disclosures for investigative consumer reports; and (2) enclose it when they give the applicant or employee a "pre-adverse action" notice.
• Do not forget your state laws. Many states have their own laws governing this issue. Some are in line with the FCRA, however, some are not and have additional requirements for employers seeking to obtain background reports (e.g., California, Connecticut, Hawaii, Illinois, Maine, Maryland, Massachusetts, Minnesota, New Jersey, New York, Oklahoma, Oregon, Washington, and Vermont).
• Lastly, keep an eye on your state's laws on this issue, including "ban the box" laws that prohibit asking about criminal arrests on applications. New laws on this issue are popping up all the time. Take Vermont, for example, that passed Vermont Act No. 154, effective July 1, 2012, which added a new section to Vermont’s Fair Employment Practices statute prohibiting employers in Vermont from failing or refusing to hire or recruit; discharge; or for otherwise discriminating against an individual with respect to employment, compensation, or a term, condition, or privilege of employment because of the individual’s credit report or credit history or even inquire about an applicant’s credit report or history unless the position of employment involves access to confidential financial information and/or if the position of employment involves access to an employer’s payroll information. Or Indiana, whose House Bill 1033, also effective July 1, 2012, restricts the types of criminal history information employers and CRAs can obtain from Indiana state court clerks and the types of criminal history information that CRAs can report to employers in background reports.

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The Equal Opportunity Commission has issued a new fact sheet titled: Application of Title VII and the ADA to Applicants or Employees Who Experience Domestic or Dating Violence, Sexual Assault, or Stalking, which explains how employment decisions related to employees who are victims of domestic violence, sexual violence, or stalking might violate Title VII or the ADA. Because these laws do not expressly prohibit discrimination against those who experience domestic violence, sexual assault, or stalking, the potential discrimination and retaliation against these individuals may be overlooked, the Commission explained. The Fact Sheet does not establish new employee protections; rather, it is a reminder to employers that actions they take with respect to employees who are victims of such conduct can create liability.

The Commission illustrates its point by providing numerous examples of workplace situations involving applicants and employees who experience domestic or dating violence, sexual assault, or stalking in disparate treatment, disparate impact and retaliation cases that would trigger liability. Some of the examples provided in the Fact Sheet include:

Title VII

• An employer who terminates an employee after learning she has been subjected to domestic violence, because he fears the potential “drama battered women bring to the workplace.”
• A male applicant does not get a job after the decision maker who, believing only women can be true victims of domestic violence because men should be able to protect themselves, refuses to hire the male when he learned the applicant filed for a restraining order.
• A supervisor learns a subordinate has recently been subject to domestic abuse, and is now living in a shelter. Viewing her as vulnerable, he makes sexual advances, and when she refuses he terminates her.

ADA

• Discrimination. An employer learns an applicant was a witness in a rape prosecution and received counseling for depression. The employer decides not to hire the applicant based on a concern that she may require future time off for continuing symptoms or further treatment of depression.
• Discrimination. An employee has facial scarring from skin grafts, which were necessary after the employee was burned in an attack by a former domestic partner. When the employee returns to work after a lengthy hospitalization, co-workers subject the employee to frequent abusive comments about the skin graft scars, and the employee's manager fails to take any action to stop the harassment.
• Failure to Accommodate. An employee who has no accrued sick leave and whose employer is not covered by the FMLA requests a schedule change or unpaid leave to get treatment for depression and anxiety following a sexual assault. The employer denies the request because it “applies leave and attendance policies the same way to all employees.”

In addition to these examples, the EEOC reminds employers of the need to maintain the confidentiality of any medical information that it acquires from the employee and the unlawfulness of retaliating against any employee who asserts his or her rights under the ADA. All in all, the EEOC's guidance breaks no new ground, but provides a good reminder to employers. The examples provided actually are instructive regardless of whether the employee's victimization is domestic or sexual in nature.

Takeways:

1. Update Training Materials. Employers should update their training materials to include the EEOC's examples, or similar ones.
2. Recognize the Potential for Liability. Employers should recognize that situations involving applicants or employees who have been subjected to domestic violence, sexual violence, or stalking trigger their legal obligations and provide these applicants and employees legal protections.
3. Protections Under Other Federal and State Laws. Employers should also be aware that other federal laws, like the Family and Medical Leave Act, and state laws may be apply to employees who are victims of domestic violence, sexual violence, or stalking. For example, Ohio employers should be aware that the following laws apply:

Crime Victims: Employers may not discharge, discipline or retaliate against crime victims, victims' families or victims' representatives for participating in preparations for criminal or delinquency proceedings (at the prosecutor's request) or for attendance at criminal or delinquency proceedings (pursuant to subpoenas), if attendance is necessary to protect victims' interests. O.R.C. § 2930.18.

Witnesses: Employer are also prohibited from discharging (or threatening to do so), punishing or penalizing employees because of time lost from regular employment due to attendance at criminal proceedings pursuant to subpoena. O.R.C. § 2945.451.
 

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Senate Bill 383 is an extremely employer-friendly piece of legislation that was introduced earlier this week in the Ohio state Senate. The bill seeks to overhaul the Ohio's employee-friendly employment discrimination laws, statutory and common law, and proposes the following non-exhaustive list of significant amendments:

1. Limits Definition of Employer and Excludes Managers and Supervisors

Currently, the definition of "employer" in Ohio means "any person acting directly or indirectly in the interest of an employer." Thus, unlike under Title VII, Ohio law, as interpreted by the Ohio Supreme Court, subjects managers and supervisors to personal liability. This interpretation not only tends to scare managers and supervisors in Ohio that decisions they make may render them personally liable, but it allows plaintiffs to go to state court with their claims and avoid federal court jurisdiction, where summary judgment motions tend to be viewed more favorably. If passed, S.B. 383 would change the definition of "employer" to do away of individual liability for managers and supervisors for discrimination, retaliation and harassment in Ohio.

2. Limits Liability for Temporary or Seasonal Employers

The proposed definition of "employer" would further limit covered employers to those who employ "four or more persons each working day in each of twenty or more calendar weeks in the current or preceding calendar year." This "twenty or more calendar weeks" language is new and potentially would provide a way for temporary and seasonal employers to limit their exposure under R.C. Chapter 4112.

3. Limit the Statute of Limitations to 365 Days

Currently, individuals have six years to file most discrimination and retaliation claims in Ohio including claims based on race, color, religion, sex, military status, national origin, disability, age, and/or ancestry. As for age, this is a little more complicated and, in some cases, individuals have either 180 days or six years, depending on which of the four, count 'em, four ways the plaintiff chooses to bring their age discrimination claim. S.B. 383 seeks to create a 365-day statute of limitations for all employment discriminations claims, including claims for promissory estoppel, breach of an implied contract, or intentional infliction of emotional distress. Should this pass, Ohio would go from having one of the longest statutes of limitations to one of the shortest.

4. Unification of Age Discrimination Claims

As indicated above, individuals have four different ways to bring age discrimination claims against employers under current law:

1.  R.C. 4112.14(B), which requires an individual to file suit within six years but limits remedies to wages and benefits, reinstatement, costs, and attorneys’ fees;
2. R.C. 4112.02(N), which requires an individual to file suit within 180 days and provides the full range of remedies, including compensatory and punitive damages;
3. R.C. 4112.05, which allows an individual to file an administrative charge with the Ohio Civil Rights Commission ("OCRC"), but precludes the individual from filing a civil lawsuit for age discrimination; and
4. R.C, 4112.99, the catch-all provision that provides an independent civil action to seek redress for any form of discrimination identified in Chapter 4112, including age discrimination.

S.B. 383 would do away with these four distinctions and include age among the other protected classes subject to the same procedures, remedies and single statute of limitation.

5. Election of Remedies

Currently, except for age discrimination claims, individuals can file an administrative charge alleging discrimination and/or retaliation and a civil lawsuit. S.B. 383 would extend the election of remedies provision that currently only applies to age claims to all discrimination claims. Thus, if passed, individuals would have to elect between filing an administrative charge with the OCRC or a civil lawsuit in court. They could not do both like they presently can in all but age cases. Should individuals choose to proceed with the OCRC, the proposed amendment also seeks to prioritize mediation and conciliation.

6. Exclusion of Those Working in a Ministerial Capacity

Currently, it is unclear whether employees employed in a ministerial capacity are entitled to protections under R.C. Chapter 4112. Earlier this year the United States Supreme Court ruled in Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC that Title VII does not offer protection to employees working in a ministerial capacity. The proposed amendments to R.C. 4112.02 would make it clear that "religion" as a protected class excludes those working for religious organizations a ministerial capacity. This would clarify the split among Ohio courts and put Ohio in line with the Supreme Court's ruling on the issue in the Title VII context.

7. Faragher-Ellerth Defense to All Discrimination Claims

Currently, employers can raise an affirmative defense in hostile work environment cases that: (1) they exercised reasonable care to prevent and correct promptly any harassing behavior and (2) the plaintiff employee unreasonably failed to take advantage of the any preventive or corrective opportunities provided by the employer or to avoid harm otherwise. If the Bill passes, this affirmative defense would apply to all types of discrimination, not just harassment, which did not result in an adverse, tangible employment action against the employee. The legislation would allow employers to raise an affirmative defense as long as it exercised reasonable care to prevent or promptly correct the alleged unlawful behavior and the employee failed to take advantage of any corrective opportunities provided by the employer or to otherwise avoid the alleged harm.

8. Statutory Cap on Noneconomic and Punitive Damages

While this issue has never been squarely addressed by the Ohio Supreme Court, noneconomic and punitive damages in employment claims arguably are capped by Ohio's tort reform statute, R.C. 2315.18 (noneconomic) and 2315.21 (punitive). With respect to noneconomic damages under R.C. 2315.18(B)(2), they cannot exceed the greater of two hundred fifty thousand dollars or an amount that is equal to three times the economic loss to a maximum of three hundred fifty thousand dollars for each plaintiff in that tort action or a maximum of five hundred thousand dollars for each occurrence that is the basis of that tort action. Pursuant to R.C. 2315.21, punitive damages are capped for tort claims based on the size of the employer. Under the statute, however, there are only two categories, "small employers", which are those employers that employ not more than one hundred persons on a full-time permanent basis (unless classified by manufacturing sector by the North American industrial classification system) and "large employers". R.C. 2315.21 prohibits a court from entering judgment for punitive damages in excess of two times the amount of compensatory damages. However, if the defendant is a small employer or individual, the court cannot enter judgment for punitive or exemplary damages in excess of the lesser of two times the amount of the compensatory damages awarded to the plaintiff from the defendant or ten percent of the employer’s or individual’s net worth when the tort was committed up to a maximum of three hundred fifty thousand dollars.

The proposed change in S.B. 383 would cap punitive and noneconomic damages in discrimination suits based on the size of the employer, but amounts available would be even more limited than those allowed under Ohio's tort reform. For example, noneconomic and punitive damages would be capped in discrimination claims as follows:

• Employers that employ 4 – 100 employees capped at $50,000;
• Employers that employ 101 – 200 employees capped at $100,000;
• Employers that employ 201 – 500 employees capped at $200,000;
• Employers that employ 501+ employees capped at $300,000.

It is unclear how this bill will fare in the legislature, but one thing is clear, Ohio employers should put its passage on their holiday wish lists.

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Sandra Williams was a sales associate for a timeshare company in Virginia Beach. After the completion of a difficult sale, Williams’s supervisor slapped her on the buttocks. Williams reported the slap to management and complained that it offended her and embarrassed her. Upper management directed human resources to investigate. After the investigation, the Company concluded that the supervisor’s conduct was inappropriate but not a violation of the Company’s harassment policy. It was the only such incident involving the supervisor, and even Williams acknowledged that it was not sexual in nature. As a result, the supervisor was admonished about the behavior.

Just prior to the complaint, the Company had begun investigating Williams’s attendance. Two months later, Williams failed to report for work or call in to report her absences as required by the Company’s policy, and as a result, the Company terminated her. Williams sued in federal court in Virginia alleging that her termination was in retaliation for her complaint about the celebratory slap.

The Court first concluded that the slap was not severe or pervasive enough to constitute a hostile work environment. Second, the Court concluded that the complaint was not protected activity and could not support a retaliation claim, even though the employer internally investigated the complaint. The Court held that, even when a complaint results in “intensive internal scrutiny,” it is not automatically protected activity under the law, especially where, as here, the complaining employee did not believe the behavior was sexual in nature. Because no reasonable person would believe that one incident was sufficient to establish a sexual harassment claim, the internal complaint was not protected activity, and Williams’s claim for retaliation failed. In addition, the Court noted that Williams’s claim failed because she could not dispute that she failed to report for work or call in and did not present a doctor’s excuse for the absences until after her termination.

Similar to the holding in this case, the Sixth Circuit Court of Appeals, which has jurisdiction over Ohio employers, has held that internal complaints that do not specifically complain about harassing behavior being racial or sexual in nature are not protected activity, even if internally investigated. Batuyong v. Gates, 337 Fed.Appx. 451 (6th Cir. July 06, 2009).

What are the key takeaways? This case reiterates the well-established principle that one isolated incident is not sufficient to establish a hostile work environment based on sex. More importantly, employers can take some comfort that by investigating complaints of alleged inappropriate behavior in good faith does not automatically turn the complaint into protected activity.

The case is Williams v. Ocean Beach Club LLC, No. 2:11-cv-639 (E.D. Va. Sept. 25, 2012).
 

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Employers still wondering about the effects of providing a private area for nursing mothers to express breast milk are getting a little more clarity on the enforcement scheme of that law under a recent decision from a federal court in Iowa.

We kept you updated on the new requirements under the Affordable Care Act (ACA) for employers with nursing mothers and provided more detail earlier this year when the federal Department of Labor started enforcing it. However, there are still many unanswered questions about this law—the DOL has not yet issued any regulations, and it's still not quite clear how these requirements will interact with existing wage and hour law. One example is enforcement—may aggrieved employees sue in court or must they follow a different process?

It was this last question that the Northern District of Iowa recently addressed. In Salz v. Casey's Marketing Co., the employer provided an office area to its employee who needed to express breast milk during the workday. The employee was told that the office was private and secure, but she later discovered that a video camera was in the room. She told her employer about the camera, stating that she was concerned about the lack of privacy. Her employer then told her to put plastic bag over the camera and refused to provide any other accommodations, including disabling the camera. Because the employee remained uncomfortable knowing that the camera was still in use, she was unable to express as much milk as before to meet her infant's nutritional needs. The employee quit, then sued her employer for its alleged violation of the recent requirements to provide a private area to express breast milk and constructive discharge in retaliation for her complaints about the violation.

The court dismissed her claim for the alleged violation of the ACA requirements. Because the ACA provided no enforcement mechanism for its nursing mother provisions, the plaintiff was limited to the remedies under the Fair Labor Standards Act. The FLSA allows employees to sue only for unpaid wages, and she lost no wages as a result of the violation. Instead, the court said that an aggrieved employee must notify the DOL, who may then bring a suit to require the employer to comply—but, no damages would be available to the employee as a result of the underlying violation.

However, lost wages can result from retaliation against an employee who complains of her employer's violation of the requirements for nursing mothers. The court allowed this claim to survive on that basis.

This decision highlights two issues for employers: first, that employees may still sue in court if employers retaliate against them for complaining about violations of the ACA requirements; and second, although employees cannot sue for ACA violations directly, the DOL has the ability to investigate any complaints and can file suit to enforce the law. As new developments emerge in this area, we will keep you in the loop.
 

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The Ohio Court of Claims in Richard Warden v. Ohio Department of Natural Resources held that, at least for public employers, a policy against re-hiring retired employees had a discriminatory impact on age.

Richard Warden worked for the Ohio Department of Natural Resources in the Mineral Resources Management (MRM) Division for over 30 years before accepting a buyout and retiring. At the time, he was 51 years old. Following his retirement, he was awarded four one-year contracts for part-time work performing the same type of work that he performed before he retired. In 2010, MRM posted a full-time position performing work similar to the work Warden performed on a part-time contract basis, and Warden (who was 54 at the time) applied for the position. Warden was interviewed and received the highest overall score in the interview process. Warden was not hired, however, because it was discovered that MRM had a policy prohibiting re-hiring retirees to full-time positions. Retirees were limited to temporary project-driven contracts for less than 1000 hours, as Warden had been employed in the past. A 39 year old was selected for the position.

Warden sued alleging age discrimination under Ohio’s discrimination statute. Because Warden applied for state employment, the Ohio Court of Claims heard his case. (The Ohio Court of Claims does not hear cases involving private sector employment. ) The Court rejected his disparate treatment claim—alleging that the decision was actually motivated by Warden’s age—because a facially neutral policy restricting rehiring former employees motivated the decision, not Warden’s age. MRM presented evidence that the policy was motivated by a desire to avoid “double-dipping”—where employees retire and collect retirement benefits and are re-hired in the same or similar position.

The Court examined the policy under a disparate impact discrimination theory—alleging that the facially neutral policy has a harsher effect on older workers. The Court reasoned that, because only individuals over the age of 40 were eligible to retire under the early retirement policy, the no re-hire policy had a disparate impact on age. MRM argued that the negative public perception of double-dipping and public trust justified the policy. Yet there was evidence presented that, in some cases, double-dipping saved money because of increased productivity and decreased training costs, in addition to retirees sometimes accepting lower salaries after their retirement. Evidence was also presented that exceptions had been made to the policy in the past with no negative publicity. The Court concluded that MRM failed to show that the decision was based on a reasonable factor other than age.

This decision is limited to public employers, so, if you are a private sector employer, why should you care? Well, the rationale is equally applicable to these types of policies in the private sector. As always, employers should be careful in adopting policies that will, by their definition, affect only employees age 40 and over. There is always a risk that the policy will be viewed as having an adverse impact on older workers.

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Employer Law Report is pleased to introduce our readers to Brad Hughes, a partner in our Appellate Practice Group, who has written this guest blog article.

Next term, the Supreme Court may resolve a split among the circuits about who qualifies as a “supervisor” under Title VII, which prohibits employers from engaging in race-based discrimination. Vance v. Ball State University, Supreme Court Case No. 11-556 (certiorari materials available here on ScotusBlog).

As many readers of this blog will already know, employers can be held strictly liable for harassment inflicted by “supervisors.” But where only co-workers – not “supervisors” – are culpable, then the plaintiff must show that the employer has been negligent either in discovering or remedying the harassment. These standards emanate from the high court’s 1998 decisions in Faragher v. Boca Raton and Burlington Industries, Inc. v. Ellerth.

Because the difference between strict liability and negligence is so meaningful when the rubber hits the road in court, a number of judges have grappled with the distinction between “supervisors” and “co-workers.” In the real world, that distinction is not always as clear-cut as it might seem. In Vance, for example, the plaintiff was the only African-American employee in the catering department at Ball State. She filed reports about her colleagues’ offensive conduct and obtained a right-to-sue letter from the EEOC. Ball State prevailed on summary judgment, though, and the Seventh Circuit affirmed. Although Vance asserted that one of her harassing colleagues had the authority to tell her what to do, and did not “clock-in” like Vance or other hourly employees, the Seventh Circuit agreed that this did not create a material dispute of fact about whether Vance was being harassed by a “supervisor,” saying:

Under Title VII, a supervisor is someone with power to directly affect the terms and conditions of the plaintiff’s employment. That authority primarily consists of the power to hire, fire, demote, promote, transfer, or discipline an employee. We have not joined other circuits in holding that the authority to direct an employee’s daily activities establishes supervisory status under Title VII.

Vance v. Ball State University (7th Cir. 2011) (emphasis in original; internal citations omitted.)

When Vance appealed to the Supreme Court, she cast the issue as a split between the Second, Fourth, and Ninth Circuits (applying the broader view of “supervisor”) and the First, Seventh, and Eighth Circuits. She argued that the Seventh Circuit’s position seems at odds with the Supreme Court’s decision in Faragher, because one of the lifeguards who was deemed to be a “supervisor” in that case “plainly lacked” power over the harassment victim’s employment status. Opposing certiorari, Ball State contended that the high court had “previously denied a petition *** presenting the same asserted circuit split and the basic question presented here.” Apparently, the Supreme Court has decided that the time is ripe to try to bring some additional clarity to this recurring issue that has divided the circuits.

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Two of the more difficult reasonable accommodation requests that employers see are requests to be excused from shift and/or job rotation requirements. Last week, the federal Eighth Circuit Court of Appeals held in Kallail v. Alliant Energy Corporate Services, Inc. that an employer's shift rotation requirement was an essential job function that permitted the employer to deny an employee's request to be excused from the requirement as a reasonable accommodation for her Type I diabetes. In Kallail, the plaintiff was responsible for monitoring the distribution of electricity, gas, and steam throughout the company's service territory, scheduling and routing resources to respond to routine and emergency work, and handling outage and other emergency situations so as to restore service and maintain system integrity. To provide coverage 24 hours per day, seven days a week, the employer required the plaintiff and others in her position to work an irregular rotating schedule. The plaintiff, however, alleged that working the rotating schedule was causing her to experience erratic changes in blood pressure and blood sugar, which put her at a higher risk for diabetic complications and death.

Armed with a medical recommendation that she only be assigned to the day shift, the plaintiff sought a reasonable accommodation, which was denied. As an alternative accommodation, the company said it would consider reassignment “to another vacant position with a straight day shift for which she was qualified.” When informed of three available positions, the plaintiff rejected them because one required walking, which she was unable to do, one paid less than her current position, and one would have required her to relocate or to commute a significant distance to work. One month later, the plaintiff underwent leg surgery and was placed on FMLA leave. While on leave, she applied for another position that had a straight eight-hour day shift schedule and was two job grades higher than her current position. She was one of six applicants to receive an interview, but the company hired another candidate. Upon the expiration of her leave, the plaintiff returned to work in a temporary day shift assignment, but went back on – and remained on -- leave when she and the company were unable to find a mutually agreeable position into which she could transfer.

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Ondricko v. MGM Grand Detroit, LLC (6th Cir. Aug. 8, 2012), is a Title VII race and gender discrimination case that has it all – gambling, direct evidence of discrimination, vague employment polices, employer arguments that are directly inconsistent with its evidence, and a big lesson for employers: Don't lose sight of the ball. Every adverse employment decision can expose an employer to liability if done wrong, even ones against "white girls."

Kimberly Ondricko, a white female, was employed as supervisor with the MGM Grand Detroit casino ("MGM") when she was terminated for allegedly participating in a "bad shuffle." Ondricko had been employed by MGM since 2003. She worked her way from Dealer-Trainee to Dealer 1, to part-time Floor Supervisor, to full-time Table Games Supervisor in October 2005. As supervisor, Ondricko was responsible for supervising the dealers in the Pit.

In April 2008, Ondricko was supervising Vivian Baran, a dealer, who had one customer playing blackjack. Baran had an issue shuffling the cards due to a malfunction with the card shuffler that caused Baran to deal cards she had already dealt, which was not supposed to happen. Ondricko never left the table during the shuffle and informed her supervisor, the Pit Boss, about what had occurred. She was immediately suspended pending an investigation. The next day, Ondricko was terminated for violating an ambiguous conduct rule that provided: "What in the business judgment of MGM jeopardizes the efficiency or integrity of the gaming operation is prohibited."

So here's where it get complicated for MGM. Since 2004, at least six other supervisors had engaged in misconduct related to shuffle procedures – only two of whom were terminated. After MGM decided to terminate Ondricko, but before it informed Ondricko of its decision, Mike Hannon, Tables Games Assistant Shift Manager, spoke to Mike O'Connor, Vice President of Operations, about Ondricko and asked why Warren Black, a black male, was given a three-day suspension based on the violations of the same policy for approving a bad shuffle, but Ondricko was being terminated. O'Connor claimed it was because Black did not approve a bad shuffle, like Ondricko had. Black had approved a shuffle, stepped away from the table, after which a dealer sought to put unshuffled cards into play. Before the cards were dealt, however, a new dealer showed up, noticed the error and informed Black who advised the dealer to put shuffled cards into play.

During the conversation, O'Connor also brought up Nakeisha Boyd, a black female, who had a much worse disciplinary record than Ondricko, and who was terminated after supervising a mini-baccarat game where the dealer had trouble removing cards from the shuffler. Boyd assisted the dealer by removing the unshuffled cards and gave unshuffled cards back to the dealer to be put back into play. O'Connor brought up Boyd because he had just fielded questions from Boyd's attorneys who wanted to know how MGM intended to discipline Ondricko. Then, and for whatever reason, O'Connor added, "do you think I want to fire Kim, I didn’t want to fire Kim, how could I keep a white girl."

Ondricko sued for gender and race discrimination and the trial court threw both claims out on summary judgment. On appeal, the Sixth Circuit Court of Appeals reversed and remanded the case back to the trial court.

Ondricko's Race Discrimination Claim:
Ondricko argued that her race was a motivating factor in her termination, even though other factors, like the bad shuffle, also motivated her discharge. Therefore, the court reviewed Ondricko's claims using a mixed-motive analysis, which applies to cases where a plaintiff claims the adverse employment action is the result of a mixture of legitimate an illegitimate motives.

The court picked apart O'Connor's statement and concluded that a reasonable jury could conclude that Ondricko's race was a motivating factor in MGM's decision to terminate Ondricko. The statement was made by the decision maker; it occurred right after fielding questions from a fired black female employee's attorneys; and O'Connor flatly admitted that he did not want to fire Ondricko, but "how [could he] keep the white girl." Thus, it was reasonable for a jury to conclude that MGM was motivated by a desire to be racially balanced in its terminations for misconduct related to shuffling, and held that the statement was direct evidence of race discrimination.

With this, the burden shifted to MGM to prove that it would have terminated Ondricko even if it had not been motivated by impermissible discrimination. The court found that MGM failed to meet its burden because it based its decision to terminate Ondricko on an ambiguous policy and because it applied the guideline inconsistently to people of different races.

In coming to this conclusion, the court went back to the MGM's records regarding Black's three-day suspension for his shuffling issue and MGM's argument that Black was merely suspended because he did not "approve" a bad shuffle, like Ondricko did. The problem ... MGM's own company documents stated that Black was disciplined for "approving" a bad shuffle. (That's a big uh oh).

MGM attempted to further distinguish Ondricko's situation from Black by arguing that she actively participated in a bad shuffle. This argument, however, was just not logical. It rewarded Black for walking away from the table during a shuffle, which just so happened to also violate MGM's policy requiring supervisors to observe the entire shuffle, and disciplined Ondricko who stayed at the table. With this, the court reversed and remanded the case.

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Presume for a moment an employee complains to Human Resources that a co-worker's perfume makes her want to choke. The workplace sometimes brings us "closer" together and one worker's scent can be another worker's source of distraction or even discomfort. If the complaining employee's problem is just a matter of personal preference, then the employer has no legal duty to take action, but may want to explore a diplomatic way to resolve the dispute. On the other hand, a recent decision by the United States District Court for the Southern District of Ohio shows that, in some circumstances, this issue can result in a legal challenge.

In Core v. Champaign Cty. Board of County Commissioners, (S.D. Ohio No. 3:11-CV-00166), an employee sued the County under the Americans with Disabilities Act (ADA) and under Ohio disability discrimination law for not accommodating her request for a "fragrance-free" workplace policy. The employee suffered from severe asthma and chemical sensitivity to certain perfumes and other scents. She began experiencing difficulty breathing at work when co-workers in her proximity were wearing a perfume called "Japanese Cherry Blossom." According to the Complaint, her initial request that the employer ask employees to refrain from wearing that perfume went unheeded. Her symptoms became more severe and eventually she had to have emergency medical treatment.

Shortly after the employee sought medical treatment, co-workers began to mock her, including in Facebook posts making fun of her condition. She also alleges that employees began to wear the perfume intentionally around her and that the employer took no action to stop this conduct.

The employee presented a request to the employer signed by a nurse practitioner asking that co-workers be advised of the employee's sensitivity and that they be asked to avoid use of the perfume. The employer apparently communicated by email to employees asking that they not approach the employee personally, and instead communicate with her only by telephone or email. The employer also asked the employee to attempt to have face-to-face conversations with staff only in well-ventilated, open areas of the office.

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The Sixth Circuit Court of Appeals, sitting en banc, has decided that a worker suing under the Americans with Disabilities Act ("ADA") no longer must prove she was fired solely because of her disability, but instead need only show that her employer would have kept her "but for" her disability. Lewis v. Humboldt Acquisition Corporation, Inc.

Susan Lewis was employed as a registered nursed at Humboldt Acquisition Corporation, Inc., ("Humboldt") from July 2004 until March 20, 2006, at which time she was allegedly terminated for a profanity-laced outburst directed at her supervisors. Lewis filed a suit in federal district court for wrongful termination under the ADA. She claimed she was terminated because her medical condition made it difficult for her walk, and because she sometimes required a wheelchair.

Humboldt asked the court to instruct the jury that Lewis could only prevail on her ADA claim if her disability was the sole reason for her firing. Lewis, on the other hand, requested the court direct the jury to find in her favor if it found her disability was a motivating factor in her termination. The district court rejected Lewis' instruction, following the longstanding 6th Circuit precedent that a worker suing under the ADA must prove she was fired solely because of her disability. The jury ruled in Humboldt's favor.

Lewis first appealed to the 6th Circuit arguing the district court should have instructed the jury that her disability only had to be one motivating factor—the same test applied by most other federal circuits and applied in Title VII claims alleging discrimination based on race, color, religion, sex, and national origin. For the past 17 years, however, the 6th Circuit has required district courts to use the sole cause test. The Court first applied the "sole cause" requirement, as found in the Rehabilitation Act in a footnote in Maddox v. University of Tennessee, 62 F.3d 843 (6th Cir. 1995). The Court applied this reasoning since the ADA and the Rehabilitation Act paralleled each other.

The panel affirmed the district court's judgment, holding: "this Court cannot overrule the decision of another panel . . . unless an inconsistent decision of the United States Supreme Court requires modification of the decision or this Court sitting en banc overrules the prior decision." Lewis v. Humboldt Acquisition Corp., No. 09-6381, Sixth Circuit Court of Appeals (March 17, 2011).

Lewis filed a subsequent appeal, and on Friday, May 25, 2012, the Court issued a 9-7 en banc decision, in which it abandoned the "sole cause" test, but also rejected the "motivating factor" test championed by the plaintiff. The Court instead concluded that the "but for" test espoused in Gross v. FBL Financial Services, 129 S.Ct. 2343 (2009), an age discrimination case, in which the U.S. Supreme Court held that employees suing for age discrimination under the ADEA must show they would have kept their jobs "but for" their age, because the statutory language in the ADEA requires proof that the individual was discriminated against "because of" his age. The 6th Circuit majority concluded the same test should be applied to disability claims under the ADA which similarly requires proof of discrimination "because of" the individual's disability.

Because the Lewis jury was never given the opportunity to evaluate the evidence under the proper standard, the en banc decision remanded the case back to the district court for a new trial. Though employers in the Sixth Circuit have had the benefit of the "sole cause" standard for several years, the Sixth Circuit was alone among the other circuit courts in this interpretation of the ADA. Although the "but for" standard is more plaintiff friendly, it is certainly better than the "motivating factor" standard that the court could have imported over from Title VII.

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In Wymsylo v. Bartec, Inc., the Ohio Supreme Court unanimously ruled that the Ohio Smoke Free Workplace Act is constitutional and, in doing so, rejected a bar owner's claim that the penalties for violating the Smoke Free Workplace Act ("SFWA") are excessive and inappropriate
By way of background, in November 2006, 58% of Ohio voters passed the SFWA making Ohio the 12th state (the first in the Midwest) to protect all workers and the public from exposure to secondhand smoke in public places. The law impacts “public places” and “places of employment” in Ohio. Subject to certain exemptions, the SFWA prohibits "public places" and "places of employment" from permitting smoking in their establishments. To comply with the SFWA affected entities must:

• prohibit smoking;
• post “No Smoking” signs which include the telephone number 1-866-559-OHIO (6446) for reporting violations ─ sample signs can be downloaded and printed from the Ohio Department of Health's webpage; and
• remove all ashtrays and other smoking receptacles.

Enforcement of the law began on May 3, 2007 and provides that a daily fine for a violation of the SFWA "shall be not less than $100 and not more than $2,500". Fines are doubled for intentional violations. The text of the SFWA, which is codified at Ohio Revised Code Chapter 3794, is available here.

In Wymsylo, between July 2007 and September 2009, Zeno’s Victorian Village was cited on ten separate occasions by the Columbus City Health Department for smoking ban violations and assessed $33,000 in fines, none of which were paid. The bar currently owes $40,457 in fines and interest penalties for numerous smoking-ban violations and the state is threatening to seize and foreclose on the bar to get the money.

In challenging the fines, and the law itself, the owner of Zeno's Victorian Village argued that the fines levied upon the bar for violating the law were unduly oppressive, beyond the state's legitimate police powers and, as such, an unconstitutional "taking" of private property because it "confiscates a proprietor's control over indoor air" (yes, that quote is accurate.). Although not as creative as the first argument, the owner also argued that the Ohio Department of Health should be stopped from enforcing the law.

The high court disagreed with both contentions and found that the SFWA does not unreasonably interfere with property rights or amount to a taking because "the 'taking' of...indoor air space is not the type of taking contemplated by either the Fifth Amendment to the U.S. Constitution or the Ohio Constitution, Article I, Section 19." The Court went on and found that "[i]t is not unreasonable or arbitrary to hold responsible the proprietors of public places and places employment for their failure to comply with the Smoke Free Act" and noted that the bar owner's "own witness testified that most patrons who are asked to stop smoking readily do so."

With this decision, it looks like the SFWA is here to stay. If you as an employer or public property owner have been relaxed in complying with the SWFA's mandates, now would be a good time to ensure your facilities are compliant. It is also advisable that employers adopt a smoke-free policy that designates where employees may smoke, if at all.

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The recent decision out of Texas in Sechler v. Modular Space Corporation highlights a recurring issue for employers -- managing employees who return to work following rehabilitation for substance abuse. In Sechler, the plaintiff, a recovering alcoholic, was by all accounts an excellent employee for approximately 10 years until he experienced a relapse. He requested EAP services and, as a result received outpatient treatment for about a month.

Upon returning to work, he was asked to sign a "Return-to-Work” agreement, outlining the requirements with which he had to comply as a condition of his return to work. The Agreement specified that Sechler was to attend weekly Alcoholics Anonymous meetings and provide proof of attendance, as well as submit to at-will drug and alcohol screenings. He also agreed that a positive result on any screening would result in his termination.

Upon his return to work, Sechler asked that he be given permission to leave work early to attend his AA meetings, but was told he needed to schedule them on his own time. He then was scheduled for and passed a drug screening. A few weeks later, he then began exhibiting what his coworkers described as unusual behavior; that his speech was slurred and that he smelled of alcohol. One co-worker said that he thought he had seen Sechler go to the passenger side of his car and take a drink.

As a result, ModSpace scheduled Sechler for another screening and, out of a concern for his and others' safety, insisted that he not drive there himself. He refused to go unless he could drive himself to the screening. ModSpace's chief human resources officer, Sean McManus, then offered to pay for a taxi to take Sechler to the testing facility, which Sechler also refused. Because Sechler refused to allow someone to drive him to the facility, he could not produce a complying test result, and McManus made the decision to terminate his employment.

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Employers often defend against discrimination and retaliation claims by arguing that courts should not act like super human resources managers who second guess their employment decisions. A panel of the Sixth Circuit took that argument to heart in its May 8th decision in Seeger v. Cincinnati Bell Telephone Co., in which the court upheld summary judgment in favor of the employer on the ground that the employer had an "honest belief" that the plaintiff had engaged in disability fraud.

Tom Seeger was on FMLA leave for aback injury when he was spotted at the Cincinnati Oktoterfest by several of his co-workers. One of the employees contacted human resources to say at Seeger was able to walk 50 to 75 feet, seemingly unimpaired. During the employer's investigation, however, others remarked that Seeger seemed to to be in pain. The employer's investigation investigation also included an interview of Seeger and a review of his medical records, disability file and employment history. Seeger was suspended and was given an opportunity to submit a statement as well as a statement from his physician. After considering all of this information, the employer decided that Seeger's activity at Oktoberfest was inconsistent with his claimed disability and terminated him for disability fraud.

Seeger filed suit for interference with his FMLA rights and for retaliation in violation of the FMLA. With respect to the interference claim, the court concluded that Seeger had been given all of the FMLA leave he had requested since he had actually returned to full duty during the course of the investigation. With respect to the retaliation claim, the court noted the closeness in time between the FMLA leave and the termination, but concluded that CBT made a “reasonably informed and considered decision” before it terminated Seeger, and that Seeger has failed to show that CBT's decision-making process was unworthy of credence.

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In 1999, in Cleveland v. Policy Mgmt. Sys. Corp., the U.S. Supreme Court held that in order to avoid summary judgment in a disability discrimination case brought under the ADA, a plaintiff must provide a "sufficient" explanation regarding any conflicting statements made in a Social Security disability application.  According to the Supreme Court, that explanation must be "sufficient to warrant a reasonable juror's concluding that, assuming the truth of, or the plaintiff's good-faith belief in, the earlier statement, the plaintiff could nonetheless 'perform the essential functions' of her job, with or without 'reasonable accommodation.'"

Last week, in EEOC v. Greater Baltimore Medical Center, Inc., the Fourth Circuit federal appeals court rejected the EEOC's position that Cleveland does not apply in enforcement actions brought by the EEOC on behalf of an individual claimant.  While acknowledging that the EEOC has a governmental interest in an enforcement action that is not merely derivative of the individual claimant's interest, the court concluded that "this does not mean that a claimant's statements to other government agencies are somehow less relevant to an enforcement action on behalf of the claimant than they are for an action pursued by the claimant himself."

In concluding that the EEOC and the claimant in GBMC did not meet this burden, the Court noted multiple comments from the claimant indicating his total inability to work and his failure to notify the Social Security Administration of his agreement to notify it if his condition improved to the point where he would be able to return to work.  While noting that it "did not condone" and was "deeply concerned" about the employer's failure to reinstate the individual claimant when the medical evidence demonstrated he was capable of working, the court granted the employer's motion for summary judgment stating that it was constrained to do so based on the plain language of the ADA and relevant case law.

GBMC found that reliance on the Cleveland decision was a great litigation strategy to avoid potential ADA liability, but there may be another lesson for employers to take from the GBMC case prior to litigation.  When an employee is seeking reinstatement from a lengthy leave of absence, employers should make sure they know whether the employee has applied for benefits that may be inconsistent with the request to return to work.  Doing so will help inform any reasonable accommodation process and will help employers ensure that they do not return employees to work who may not be able to work safely.  

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The Equal Employment Opportunity Commission (EEOC) decided on April 20, 2012 that discrimination against an employee on the basis that they are transgender was the equivalent of sex discrimination under Title VII of the Civil Rights Act of 1964. Macy v. Holder, EEOC Case No. 0120120821. Title VII protects employees against discrimination on the basis of a several protected classes, including sex. While many states and municipalities include transgender and sexual orientation as protected classes, Title VII has not been interpreted to protect these individuals on this basis alone. Individuals must show that the discrimination was based on their sex, which is often shown by arguing that stereotypes about genders played a role in the decision making.

The claimant in this case, Mia Macy, was a police detective in the federal Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). Macy, then male, applied for a transfer within ATF. During the background check for the transfer, Macy informed the investigator that he was transitioning to a female. Five days after ATF learned this information, Macy was informed that the position was no longer available due to budgetary restrictions. Macy later learned that someone else had been hired for the position. Macy was later told that the other individual was hired because the individual was further along in the background check process. Macy believed that the other individual was chosen because of discrimination against Macy as a transgender person.

Macy filed a complaint with the EEOC alleging discrimination on the basis of “gender identity, change of sex, and/or transgender status.” ATF argued that this was not a recognizable claim under Title VII. Macy appealed to the EEOC for a determination. Initially, Macy also claimed sex discrimination on the basis of stereotyping, but that claim later was withdrawn. Courts have long-held that sex stereotyping—that an individual does not conform to the stereotypes for the male or female gender—is actionable.

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On April 25, 2012, the EEOC issued a new Enforcement Guidance memorandum focusing on potential race and national origin discrimination arising out of employer use of criminal background checks in making employment decisions. The Guidance discusses disparate treatment and disparate impact analysis under Title VII and concludes that the use of criminal background information may result in a violation of Title VII under either theory of discrimination. Specifically, the Guidance notes that a disparate treatment violation may occur when an employer treats criminal history information differently based on an applicant's or employee's race or national origin. Or, an employer's neutral policy (e.g., excluding applicants from employment based on certain criminal conduct) that disproportionately impacts individuals based on their race or national origin would violate Title VII if the policy is not job related and consistent with business necessity.

The Guidance addresses the differences between arrest and conviction records. With respect to arrest records, the Guidance states that the fact of an arrest does not establish that criminal conduct has occurred, and an exclusion based on an arrest, in itself, is not job related and consistent with business necessity. However, an employer may make an employment decision based on the conduct underlying an arrest if the conduct makes the individual unfit for the position in question. By contrast, a conviction record will usually serve as sufficient evidence that a person engaged in particular conduct, but according to the EEOC, under certain circumstances, there may be reasons for an employer not to rely on the conviction record alone when making an employment decision.

The Guidance spends the most time discussing the potential disparate impact arising out of criminal background checks. According to the Guidance, national data generally supports a finding that criminal record exclusions have a disparate impact based on race and national origin. As a result, the EEOC will scrutinize a criminal record exclusions. This does not mean that employers cannot demonstrate that the particular exclusion it utilizes will automatically be found to have a disparate impact based on race or national origin. Instead, the EEOC will assess relevant evidence in determining whether a disparate impact exists. For instance, the EEOC will look at applicant flow information, workforce data, criminal history background check data, demographic availability statistics and incarceration/conviction and other similar data for the relevant labor market. Therefore, the employer may demonstrate the lack of any disparate impact by showing that local statistics show that African Americans and/or Hispanics are not arrested or convicted at disproportionately higher rates in the geographic area from which it does its hiring.

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The EEOC recently issued a revised publication on the employment of veterans with disabilities. According to the EEOC, the publication reflects changes in the law made by the ADA Amendments Act of 2008 (ADAAA), which made it easier for persons, including veterans, to establish they meet the definition of “disability.” The wide range of impairments covered by the ADAAA include those that are often not well understood, including post-traumatic stress disorder (PTSD), major depressive disorder, and traumatic brain injuries, as well as deafness, blindness, partial or missing limbs, and mobility impairments. This is an issue that will become of increasing relevance as large numbers of veterans return from Iraq and Afghanistan.

Employers should be aware that the ADAAA and the Uniformed Services Employment Reemployment Rights Act (USERRA) protect disabled veterans from discrimination in different ways. USERRA requires employers to go further than the ADA by making reasonable efforts to assist a veteran who is returning to employment to become qualified for a job, whether or not the veteran has a service-connected disability, often through training or retraining. Veterans may have up to two years from the date of completion of service to return to their jobs or apply for reemployment under USERRA. USERRA also applies to all employers, regardless of size, whereas the ADA applies to employers with 15 or more employees. Employers may be required to accommodate a disabled veteran under USERRA where they would not otherwise be required under the ADAAA.

The link to the updated guide on employment of disabled veterans is: http://www.eeoc.gov/eeoc/publications/ada_veterans_employers.cfm

Highlighting some of the guidance provided by the EEOC:

• Employers may not make assumptions about the veteran’s ability to do the job based on the fact that the veteran has a disability rating from the U.S. Department of Veterans Affairs (VA).
• Employers may, for affirmative action purposes (in accordance with rules regarding applicant self-identification for federal contractors and subcontractors), ask applicants to voluntarily identify as a disabled veteran prior to making an offer. This is an exception to the ordinary rule prohibiting employers from asking for medical information prior to making an offer.
• Employers may also ask for suitable candidates from organizations that help veterans or veterans with disabilities find employment. Federal contractors and subcontractors are required to take affirmative action to employ and advance qualified disabled veterans.
• The ADAAA does not prohibit employers from giving special preference to veterans with disabilities, but employers may not discriminate against individuals with disabilities, including disabled veterans.
• Employers should keep in mind that some veterans with service-related disabilities may require reasonable accommodations during the application process.

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The Sixth Circuit's decision in Berryman v. SuperValu Holdings, Inc., clarifies that the "totality-of-the-circumstances" test used in hostile work environment cases does not have to be based on what the individually employee actually experiences, but rather what the individual employee is aware of.

In the case, eleven current and former SuperValu warehouse employees alleged that over a twenty-five year period, they were exposed to a racially hostile work environment that included vulgar graffiti, overtly racist comments by coworkers, and racially motivated pranks. The district court tossed out the employee's claims out finding that while the acts were reprehensible, they did not amount to a hostile work environment. The Sixth Circuit affirmed the lower court and in doing so clarified what can be considered in the "totality-of-the-circumstances" test.

By way of relevant background, to prevail on a hostile work environment claim, a plaintiff must show that his work environment was both objectively and subjectively hostile. In evaluating hostile work environment claims, courts look at the totality of the circumstances and consider things like the frequency of the discriminatory conduct; its severity; whether it is physically threatening or humiliating, or a mere offensive utterance; and whether it unreasonably interferes with an employee’s work performance.

Oftentimes plaintiffs want to rely on instances of discrimination/harassment that happened to other employees, but not to them personally. Whether or not the experiences of co-workers are relevant is a common dispute among counsel in defining the scope of discovery in these types of cases. On one end, plaintiffs typically argue that courts should consider all employees complaints in the aggregate to show a hostile environment, regardless of whether the individual plaintiff was actually aware of the other incidents or not. On the other, employers typically argue that courts should only consider the actual experience of the individual plaintiff.

The Sixth Circuit declined both approaches in favor of a middle-of-the-road approach and found that: "a plaintiff does not need to be the target of, or a witness to harassment in order for us to consider that harassment in the totality of the circumstances; but he does need to know about it." In coming to this conclusion, the court noted that an employer could create a hostile work environment by directing discriminatory acts or practices at a protected group of which the plaintiff is a member, and not just at the plaintiff personally. The decision, however, does make clear that a plaintiff does have to be aware of the allegedly discriminatory acts or practices directed at others in order to use such evidence in the plaintiff's individual case. Thus, for the plaintiffs to be able to use their collective experiences in the aggregate, they would have had to "marshal basic evidence to show that they were individually aware of the harassment experienced by other plaintiffs." Here they did not.

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The Ohio Court of Appeals for the Ninth Appellate District recently issued a decision that has potential to create more questions than answers when it comes to workers' compensation retaliation and disability discrimination law in Ohio.

While employed at Aldi, Maria Scalia injured her elbow. Her claim for workers' compensation was granted, and she was off work receiving workers' compensation benefits while her restrictions impaired her ability to perform her job. A year later, Aldi ordered an independent medical examination which found Ms. Scalia had reached maximum medical improvement, which resulted in the termination of Ms. Scalia's workers' compensation benefits. That medical examination also found that she could work without restrictions, even though Ms. Scalia's personal physician still had some restrictions in place. Shortly after her benefits were terminated, Aldi terminated her employment under its "no fault" attendance policy that required termination of any employee who had performed no work in the past 12 months.

Ms. Scalia claimed retaliation for participation in the workers' compensation system, wrongful discharge in violation of public policy, and violation of Ohio disability discrimination law because Aldi perceived her as having a disability and fired her for that reason.

What's the good news for Ohio employers?
The court found that Aldi's policy of terminating employees who had performed no work in the past 12 months to be "facially neutral" and that Scalia's termination was not "retaliation per se" for her participation in the Ohio workers' compensation system.

What's the bad news?
The court, in remanding Scalia's case back to the trial court, did not foreclose that Scalia could otherwise support a retaliation claim, saying that their conclusion of no retaliation per se "should not be interpreted to say that an employee can never allege a statutory retaliation claim based on action taken under an attendance policy, or that an employer's use of a facially neutral attendance policy can never be a pretext for retaliation."

Considering this, employers with these types of "no-fault" attendance policies should be mindful of the risks related to retaliation where all or even some of the days missed under the policy are due to protected types of activity or leave, including workers' compensation, FMLA, or leave provided as a reasonable accommodation under the ADA—particularly if application of the policy frequently involves consideration of absences covered by these types of statutes. Though courts in Ohio won't automatically find that application of such policies is retaliatory, employees who can show that protected activity (such as participation in the workers' compensation system) factored into the employer's decision are likely to succeed in getting their cases to trial. From the perspective of the workers' compensation retaliation claim under Ohio law, employers still should be protected so long as they apply the no fault attendance policy evenhandedly and consistently regardless of whether the employee was absent due to a workers' compensation injury.

As an aside, the Scalia decision also addresses technical distinctions between the definition of "disability" under Ohio discrimination law and the definition under the federal ADAAA. Rather than cause heads to explode dissecting the court's nuanced opinion on this issue, it is probably better to recognize that the ADAAA definition has become quite expansive and employers therefore will be better served in the vast majority of situations by assuming the employee with a physical or mental impairment has a "disability" and by addressing the reasonable accommodation question first.

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Employers in the healthcare industry may find that they no longer have affirmative action obligations as of 2012 as a result of the National Defense Authorization Act, signed into law on December 31, 2011.

TRICARE is the Department of Defense healthcare program for active duty and retired military personnel and their families. Prior to the National Defense Authorization Act, the Office of Federal Contract Compliance Programs (OFCCP) took the position that hospitals, pharmacies, and other healthcare providers providing care under TRICARE contracts had affirmative action obligations as “subcontractors” pursuant to Executive Order 11246, Section 503 of the Rehabilitation Act, and the Vietnam Era Veterans’ Readjustment Assistance Act. The National Defense Authorization Act expressly excludes hospitals, pharmacies, and other healthcare providers providing healthcare services to TRICARE participants from OFCCP jurisdiction, effectively overruling a 2010 Department of Labor decision holding that a hospital providing services under TRICARE was a federal subcontractor and related OFCCP guidance.

However, healthcare providers should not immediately abandon their federal affirmative action obligations without any other review of their contracts. It is possible that other contracts could subject them to affirmative action obligations (and OFCCP jurisdiction) as federal contractors or subcontractors, including those regarding contracts with the Veterans Administration, healthcare benefits for other federal workers, and receipt of Medicare Part C or D funds, which were not addressed by this legislation and which OFCCP has already asserted create affirmative action obligations.
 

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The U.S. Department of Labor Office of Federal Contracts Compliance Programs (OFCCP) has proposed a new rule requiring federal contractors and subcontractors to set a goal to have 7% of their workforce be individuals with disabilities. Presently, federal contractors and subcontractors are only required to set percentage numerical goals for areas of their workforces where women and minorities are found to be underrepresented based on an "Availability Analysis" conducted under OFCCP regulations. The 7% goal for persons with disabilities proposed by OFCCP would apply to each job group in the contractor’s workforce. It is not based on any calculation by the contractor of availability but is rather based simply on OFCCP's estimate of the percentage of the overall workforce that is disabled.

The proposed rule also imposes a requirement that contractors invite applicants to voluntarily self-identify as an individual with a disability at the hiring stage and the pre-offer stage, and to conduct an annual anonymous survey of its employee's inviting them to identify themselves as a person with a disability. The rule would also require contractors to maintain recruiting and hiring data concerning persons with disabilities.

The proposed rule also requires contractors to develop and implement written programs for handling requests for reasonable accommodation and to engage in specific types of outreach and recruitment efforts to recruit individuals with disabilities, and to make mandatory job opening listings with the nearest One Stop Career Center as is currently required for recruiting veterans.

A link to the the OFCCP's related FAQ's can be found here.

The proposed rule is open for comment until February 7, 2012.  

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Many employers may be surprised to learn that the ADA's prohibition of medical examinations treat alcohol tests differently from tests for illegal drugs.

Under the ADA, employers may not require employees to undergo medical examinations or inquiries unless they are job-related and consistent with business necessity. Unlike tests for illegal drug use, the EEOCs' enforcement guidance considers "blood, urine, and breath analyses to check for alcohol use" to be a medical examination under the ADA. Case law is sparse, but courts have generally followed the EEOC guidance.

So, if employers want to ensure their workers aren't under the influence of alcohol, what should they do? 

• The ADA allows employers to administer alcohol tests or other medical examinations where required by another federal law or regulation. An often-cited example is Department of Transportation (DOT) regulations that require safety-sensitive transportation employees undergo regular drug and alcohol testing.
• Even if their employees don't fall within an exception like the DOT regs, employers may still implement and enforce policies that prohibit employees from working under the influence of alcohol. They may administer alcohol tests to enforce such a policy when "job related and consistent with business necessity."
• Medical examinations like alcohol tests are job related and consistent with business necessity when the employer has objective medical evidence or reasonable suspicion that the employee's ability to perform his essential job functions is impaired, or the employee is a direct threat to himself or others.
• When conducting an investigation into an employee's use of alcohol on the job, an employer may always ask the employee if he has been drinking. If an employee admits to drinking in violation of the employer's policy, it may not be necessary to administer an alcohol test.

To stay within the strictures of the ADA when testing for alcohol use, employers are best-served by treating each situation case-by-case and avoiding blanket "one-size-fits-all" testing policies. Consideration should be given to the signs of the employee's impairment, any observed impact on their essential job functions or performance, and what else may explain his behavior beyond alcohol use. Internal guidance and training on the signs of alcohol impairment may also be appropriate.
 

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The recent Sixth Circuit case of McKelvey v. Secretary of United States Army highlights the plight of many disabled veterans returning to the civilian work force and presents a lesson for employers on how not to address those issues.

James McKelvey, an Army veteran who lost his right hand and suffered other serious injuries while trying to defuse a roadside bomb in Iraq in February 2004, returned to work at the Detroit Arsenal where he claimed his supervisors and co-workers at the armory constantly harassed him by calling him "cripple," and "worthless," and not assigning him an equal workload. McKelvey complained to two supervisors, the equal employment opportunity counselor, and a human resources specialist. McKelvey was told, "things aren't going to change." He was also told, "[All] I can tell you is if you don't like the way you're being treated, go find another job."

After McKelvey was offered a position with the Oakland County Sheriff's Department, he resigned from the armory on February 16, 2007.

In October 2007, McKelvey filed suit against the Secretary of the United States Army in federal district court, claiming failure to make reasonable accommodations, retaliation, hostile work environment and constructive discharge. The hostile work environment and constructive discharge claims survived summary judgment. Following a trial in October 2009, a jury ruled for McKelvey on both claims, awarding no compensatory damages on hostile work environment, but $4.4 million in front pay on the constructive-discharge claim.

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Employers frequently require a high school diploma as a condition of employment. Employers not only look to hire individuals who possess basic skills in reading, writing and math, but also believe that having a high school diploma demonstrates a level of maturity and perseverance.

That requirement seems reasonable -- except when it "screens out" individuals based on their protected status. For instance, the EEOC has long taken the position, upheld by the courts, that high school diploma requirements have an adverse impact on minorities and therefore can be used only when a high school diploma can be shown to be job related and consistent with business necessity.

On November 17, 2011, the EEOC posted an informal discussion letter on its website indicating that high school diploma requirements likewise may have a disparate impact on individuals with disabilities. According to the EEOC, some individuals with learning disabilities have difficulty passing end-of-course assessments and cannot obtain a high school diploma; therefore, they cannot obtain jobs which require the applicant have a high school diploma.

The EEOC considered the possible impact of high school diploma requirements under the ADA and provided the following advice to employers:

[I]f an employer adopts a high school diploma requirement for a job, and that requirement “screens out” an individual who is unable to graduate because of a learning disability that meets the ADA’s definition of “disability,” the employer may not apply the standard unless it can demonstrate that the diploma requirement is job related and consistent with business necessity. The employer will not be able to make this showing, for example, if the functions in question can easily be performed by someone who does not have a diploma.

Even if the diploma requirement is job related and consistent with business necessity, the employer may still have to determine whether a particular applicant whose learning disability prevents him from meeting it can perform the essential functions of the job, with or without a reasonable accommodation.

It may do so, for example, by considering relevant work history and/or by allowing the applicant to demonstrate an ability to do the job’s essential functions during the application process. If the individual can perform the job’s essential functions, with or without a reasonable accommodation, despite the inability to meet the standard, the employer may not use the high school diploma requirement to exclude the applicant.

The EEOC informal discussion letters are not binding as law and certainly are not binding on courts. There is room for good faith argument about whether the EEOC has properly applied the disparate impact theory of discrimination to this issue. Nevertheless, the discussion letter does indicate how the EEOC will likely rule in a charge on these facts. Therefore, employers are wise to evaluate whether a high school diploma really is necessary to perform the essential functions of any job for which it is being required. Even in those situations where the high school diploma requirement can be justified, employers will still need to consider in any case where a person is being excluded for not having a diploma and information is brought to light that a disability may be the reason whether a reasonable accommodation can be provided that would permit otherwise qualified individuals with disabilities to perform those essential functions.

Of course employers should continue to be cautious about the use of high school diploma and similar educational screening tools in light of the possibility of race discrimination claims.
 

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We previously have reported on the EEOC's increasingly aggressive agenda to expand the scope of its charge investigations by subpoenaing employer documents that far exceed any potential need. Fortunately, many federal courts have rejected these fishing expeditions. EEOC v. Loyola University Medical Center presents another good example.

In Loyola, the charging party filed a disability discrimination charge with the EEOC when she was asked to submit to a psychological evaluation as part of a fitness for duty examination ("FDE") that she was required to undergo in order to return to work from a medical leave. As part of its investigation, the EEOC issued a Request for Information ("RFI") from Loyola, which included:

1. a list of employees who were ordered by certain supervisors to take FDE's since January 2008,
2. the results of the evaluations and the types of testing performed on those individuals, and
3. the reasons each listed employee was required to submit to the FDEs.

Loyola promptly responded to the request and stated that only one employee had been required to submit to an FDE by the specified supervisors. However, Loyola, citing various federal and state privacy laws, refused to disclose the name of the individual, the results of the test, or the circumstances surrounding the request for the test.

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If you don't know the answer to this question with absolute certainty, you had better go back and check your policy. In Cracker Barrel v. Cincinnati Insurance Company, a Tennessee federal court concluded that the employer's EPLI policy provided neither coverage nor even a defense to a Title VII action brought against it by the EEOC. Why? The policy in question defined a "covered claim" as "a civil, administrative, or arbitration proceeding commenced by the service of a complaint or charge, which is brought by any past, present or prospective employees." The court read this provision literally and concluded that because the EEOC was not an employee, the complaint brought by it on behalf of the company's employees was not a covered claim.

Regardless of the correctness of this decision, employers need to review their EPLI policies to see how they define a covered claim. If it is not clear that the policy covers both claims brought by and claims brought on behalf of employees, then it makes sense to go back to the insurance broker to obtain clarification from the carrier on whether the latter type of claim falls within the definition. Because claims brought by the EEOC and other governmental agencies can be among the most expensive to defend, it is important for employers to know whether they are getting what they think they are paying for.

Hat tip to Michael Fox at employerslawyer@blogspot.com.
 

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More and more these days it seems like the obligations of being a lawyer, husband, father, son, sports fan, etc, get in the way of blogging. As a result, I end up accumulating a number of worthwhile topics for blog posts that end up in the discard pile. Twitter helps keep the backlog to a minimum, but I really don't know how many of you actually follow me @briandhallesq (hint, hint). So, while I am by no means committing to make this a regular feature of Employer Law Report, I will now clear – in no particular order -- my backlog for the month:

According to a Wall Street Journal article, a recent lawsuit seeks a declaration from the New York Department of Labor that putting a GPS tracker on an employee's family car to uncover time sheet violations was a violation of the state constitution's guarantee against unreasonable searches and seizures. According to the lawsuit, the monitoring continued during evenings, weekends and a family vacation. This won't turn out well for the employer.

An Ohio appellate court has upheld a physician's non-compete agreement that prohibited him from engaging in a hematology or oncology practice in his former employer's "primary service area." This decision continues the Ohio trend of upholding physician non-competes and Ohio courts have repeatedly rejected the argument that covenants are not enforceable against physicians solely because they impair patients’ choice.

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In a decision issued in July, the Sixth Circuit addressed the standard for a claim under the "associational" provisions of the Americans with Disabilities Act and affirmed summary judgment on plaintiff's claim that his employment was terminated due to his wife's disability.

The plaintiff was the highest ranking manager for Air Wisconsin at the Kalamazoo Airport. His wife suffered from various conditions, including a rare and debilitating auto immune disorder that required expensive treatment.

Plaintiff was terminated for poor performance based on failure to report security violations, supervise employees properly and stay within budget. In filing suit, he claimed that the termination was due to consideration of his wife's disability, which he alleged impacted his work performance and caused him to be inattentive at work.

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On July 6, 2011, the EEOC announced a settlement with Verizon of a nationwide class action lawsuit alleging that Verizon violated the ADA by refusing to make exceptions to its “no fault” attendance plans to accommodate employees with disabilities. According to the EEOC's press release, Verizon violated the ADA by failing to provide reasonable accommodations for people with disabilities, such as making an exception to its attendance plans for individuals whose “chargeable absences” were caused by their disabilities. Instead, the EEOC said, the company disciplined or terminated employees who needed such accommodations. In addition to requiring the payment of $20 million in monetary relief to affected employees, the Consent Decree filed with the federal district court in Maryland requires the company to revise its attendance plans, policies and ADA policy to include reasonable accommodations for persons with disabilities, including excusing certain absences.

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The much-awaited decision of the United States Supreme Court is here. Dubbed by Justice Scalia as "one of the most expansive class actions ever," the Supreme Court unanimously reversed the decision of the Ninth Circuit Court of Appeals which had affirmed the certification of a class of approximately 1.5 million current and former female employees alleging discrimination in pay and promotion. While the result was widely anticipated, the decision clarifies some key class action principles in a manner favorable to employers defending such cases.

Throughout the lengthy proceedings (the District Court certified a class in 2004), the employees claimed that at each of Wal-Mart's 3,400 stores managers had discretion over pay and promotion, that that discretion was exercised disproportionately in favor of men and also that Wal-Mart was aware of this disparity and failed to curb the managers' authority. They alleged that there was a strong and uniform "corporate culture" permitting bias against women that infected the decision making of every manager, thereby affecting every female employee in one common discriminatory practice. To prove these allegations, the employees relied on statistical evidence, anecdotal reports of discrimination and a sociologist's opinion that Wal-Mart's corporate culture made it vulnerable to gender bias.

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Last month, we reported on a Seventh Circuit case demonstrating the broad scope of the EEOC's investigative and supervisory powers. In that case, EEOC v. Konica Minolta Business Solutions U.S.A., Inc., the court upheld an EEOC subpoena seeking to obtain the production of hiring data from the employer in response to a charge alleging racial discrimination with respect to terms and conditions of employment and eventually discharge. Today, we report on a case that demonstrates that the EEOC's investigative and subpoena powers are not limitless.

In EEOC v. UPMC, Carol Gailey, the charging party, was terminated by The Heritage Shadyside on June 22, 2008, for exceeding her maximum available leave of absence. Heritage Shadyside is a wholly-owned subsidiary of UPMC Senior Communities, Inc., which in turn is a wholly-owned subsidiary of UPMC. Heritage Place employs 170 people while UPMC employs over 48,000 people. Ms. Gailey filed a charge with the EEOC alleging disability discrimination. In response, Heritage Shadyside filed a position statement and attached several UPMC policies, including the leave of absence policy, which provided the basis for termination. The EEOC then sent a request for information to UPMC – not Heritage Shadyside – requesting the identities of employees at "all facilities in the Pittsburgh region" who had been terminated pursuant to the UPMC leave and disability policies for the period July 1, 2008 "to the present." UPMC objected to the scope of the EEOC's request and the EEOC issued a subpoena for this information.

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Reversing a $43 million punitive damage award in the largest retaliatory discharge award in Ohio history, the Eighth District Court of Appeals held that the statutory limits or caps on non-economic and punitive damages are applicable to a retaliatory discharge action brought under the Ohio Civil Rights Act. Although this is good news for employers, there are still substantial non-economic and punitive damages available to employees who successfully establish a discrimination claim under Ohio law.

In Luri v. Republic Services, Inc., et al., an employer and two of its supervisors asked a facility manager to prepare a plan to discharge three of the oldest employees at the facility. The manager told his superiors that one of the employees had strong performance evaluations and a medical condition. After informing his superiors that he had concerns that age and disability discrimination lawsuits could result if they were discharged, the manager refused to fire them. Less than six month later, the employer fired the manager after his superiors imposed some "Improvement Directives," which they claimed he failed to meet.

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Last Friday, the Seventh Circuit Court of Appeals issued a decision in EEOC v. Konica Minolta Business Solutions U.S.A., Inc. that will embolden the EEOC's aggressive use of its investigatory powers to require production of evidence in a single employee charge that could support a more systemic investigation.

In Konica, a salesperson filed a discrimination charge with the EEOC alleging that, although he had been hired only eight months previous, he was subjected to different terms and conditions of employment and then ultimately discharged due to his race. During the course of its investigation into the charge, the EEOC learned through information produced by Konica that relatively few African Americans were employed at the facility where the charging party worked or at other locations in the Chicago area. In addition, the information provided by Konica suggested to the EEOC that the majority of the African American sales persons at the charging party's facility were on the same sales team. As a result, the EEOC requested and ultimately subpoenaed Konica records relating to its hiring practices for sales personnel at all of Konica's Chicago-area facilities. Konica asked the EEOC to revoke the subpoena and, when the EEOC refused, notified the EEOC that it was refusing to comply. Konica argued that the hiring data was irrelevant to the charge, which was directed at terms and conditions of employment and termination. The EEOC then filed an application with the federal court for an order enforcing the subpoena.

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On April 25, 2011, the Department of Labor's Office of Federal Contract Compliance Programs announced a proposed rule to increase the affirmative action obligations federal contractors and subcontractors owe to veterans. It was published in the Federal Register on April 26 to allow for a 60-day comment period and will likely generate significant discussion among both contractor and veterans groups.

Some of the changes simply clean up regulatory language which is no longer accurate and others clarify existing obligations. The most controversial changes, however, add some rather significant data collection, monitoring, recruitment and hiring obligations. As the DOL's news release summarized:

"The rule proposes requiring contractors to engage in at least three specified types of outreach and recruitment efforts each year. In addition, the proposed rule would require that all applicants be invited to self-identify as a "protected veteran" before they are offered a job. Increasing data collection on job referrals, applicants and hires, and requiring contractors to establish hiring benchmarks to assist in measuring the effectiveness of their affirmative action efforts also are proposed."

As we have previously reported, this Agency has become much more active under the Obama administration and previously indicated that this rule would be forthcoming. Unfortunately, even those businesses who are making substantial, good faith efforts to employ veterans may find the proposed recordkeeping and goal setting obligations unwieldy.

Those wanting a copy of the proposed rule can find it in the April 26, 2011 Federal Register or by going to this link. Porter Wright intends to file comments as an interested party in response to the proposed rule, so please let us know if you have any positive or negative input regarding the rule.

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Yesterday, the EEOC released its Final Rule implementing the American with Disabilities Act Amendments Act, which we discussed back in September 2008 and which was signed by President George W. Bush on September 25, 2008. The Final Rule, which runs 202 pages long, includes many revisions. But the most significant revisions as discussed in the EEOC's Fact Sheet are:

• The definition of disability should be interpreted broadly in favor of broad coverage of individuals, in direct contradiction to several Supreme Court decisions that had, according to Congress, too narrowly interpreted the definition of "disability;"
• The determination of whether an individual is disabled should not require an extensive analysis;
• The adoption of "rules of construction" that are to be used when determining whether an individual is "substantially limited" in performing a major life activity. Specifically, "substantially limits":
  • Does not mean an impairment that prevents or severely or significantly restricts a major life activity;
  • Is to be construed broadly;
  • Must be assessed on an individualized basis;
  • Must be assessed without regard to the ameliorative effects of mitigating measures, such as medication or hearing aids (with the notable exception of "ordinary eyeglasses or contact lenses" which may be considered); and
  • May include an impairment that is episodic or in remission if it would substantially limit a major life activity when active.
• A refocusing of the analysis of whether an individual was "regarded as" disabled form what the employer may have believed about the nature of the individual's impairment to how a person has been treated because of a physical or mental impairment (that is not transitory or minor); and
• The clarification that an individual must have an actual disability or a record of disability to qualify for a reasonable accommodation.

The express purpose of the ADAAA is to make it easier for an individual seeking protection under the ADA to establish that he or she has a disability within the meaning of the ADA. This purpose was not lost on employees and applicants. As we previously noted, the ADAAA resulted in an immediate increase in disability discrimination charges. We expect this trend to continue.

This makes it all the more important that employers engage in good faith in the interactive process to determine whether a reasonable accommodation exists for applicants or employees with alleged disabilities. The interactive process will often result in the discovery of workable accommodations, but perhaps more importantly it also frequently results in employees and applicants feeling satisfied that no reasonable accommodation actually exists. This satisfaction alone can significantly contribute to an individual's decision not to file a charge of discrimination.
 

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Yesterday, a panel of the Sixth Circuit announced its decision in Lewis v. Humboldt Acquisition Corp, an ADA case in which the court upheld the position of prior panels requiring an ADA plaintiff to establish that his or her disability was the “sole reason” motivating an adverse employment action. As Mark J. Chumley of the excellent Management Rights Blog noted yesterday, this puts the Sixth Circuit in the distinct minority of the appellate courts to consider the standard of proof on causation in an ADA case:

“Of the ten circuits to consider the causation issue, eight apply a 'motivating factor' (or 'substantial cause') test, under which a plaintiff must only show that a disability was a motivating factor of the adverse employment action.

However, the current law in the Sixth Circuit is that a plaintiff must show that his or her disability was the 'sole reason' for the adverse employment action; this is sometimes referred to as the 'solely' standard.”

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In a scenario that frequently occurs in workplaces across the country, Linda Buck, the vice president of human resources at Proctor Hospital, was asked to terminate Vincent Staub based on information contained in a report from his supervisors that accused him of violating the terms of a “corrective action” disciplinary warning. Relying on this accusation and her own review of Mr. Staub’s personnel file, Ms. Buck decided to terminate Mr. Staub’s employment. Mr. Staub protested to Ms. Buck that his supervisors were hostile to his military obligations as a member of the U.S. Army reserves, but rather than follow up on Mr. Staub’s concern with his supervisors, Ms. Buck simply conferred with another human resources staff member and adhered to her termination decision. Mr. Staub sued Proctor under the Uniformed Services Employment and Reemployment Rights Act of 1994 (“USERRA”) claiming that his discharge was motivated by hostility to his obligations as a military reservist. His contention was not that Ms. Buck had any such hostility but that his supervisors did, and that their actions influenced Ms. Buck’s ultimate employment decision. (This type of case has been referred to as a "Cat's Paw" case, based on an Aesop's fable involving a cat, a monkey, chestnuts and fire. Justice Scalia provides more information at footnote 1 of his majority opinion.)

A jury found that Mr. Staub’s “military status was a motivating factor in [Proctor’s] decision to discharge him,” and awarded $57,640 in damages. The Seventh Circuit reversed, holding that Proctor was entitled to judgment as a matter of law because Ms. Buck had relied on more than just the supervisors' advice in making her termination decision.

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Ohio Employment Practices Law:
Highlights from latest edition of "The" Book on Employment Law in Ohio
Wednesday, March 16, 2011
2:00 - 3:00 p.m. EST

Ohio Employment Practices Law - published by West - has become "the" important reference for Ohio employers. On Wednesday, March 16, 2011, editors Bradd Siegel and John Stephen will review highlights from the recently released 2010-2011 edition of this treatise that are most relevant for human resource professionals and in-house counsel, including the continued evolution of public policy claims; the clarification of pregnancy related obligations; and the practical impact of the ADAA upon employers.

Register Now!

Wednesday, March 16, 2011 from 2:00 p.m. - 3:00 p.m. EST

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The OFCCP has released a new directive – the Active Case Enforcement Directive (ACE)  – to replace the Active Case Management directive (ACM) which was rescinded by OFCCP in December 2010. The ACE procedures will result in more in-depth OFCCP audits and will greatly increase the chances of OFCCP making findings that are adverse to the companies they audit.

Under the ACE Directive, the OFCCP will conduct full desk audits of every contractor selected for a compliance evaluation. This is in contrast to the previous ACM procedure that required full desk audits only for every 25th contractor audited or for any contractor for which an abbreviated desk audit revealed indicators of potential class-wide, systemic discrimination. Under the ACE Directive, every 25th contractor audited will be selected for a full compliance review – desk audit, onsite review, and possible offsite analysis – regardless of the findings of the initial desk audit. This will generate far more full reviews than the old procedures, which required a full compliance review only of every 50th contractor or when there were indicators of class-wide or systemic discrimination.

At the beginning of every audit , OFCCP will contact the EEOC and State fair employment practices agencies to determine the nature, status, and outcome of any complaints filed against the contractor. The directive says OFCCP will expand this effort to also include gathering information from other federal enforcement agencies, such as OSHA and the Wage Hour Division, to determine if the employer has a history of violating other employment statutes that might be looked to as a possible indicator of discrimination.

Perhaps of greatest significance is the fact that OFCCP will now proceed to an onsite review where there are any "indicators of discrimination." In the past, other than doing an onsite of every 50th contractor, the agency did an onsite only where there were indicators in the desk audit of systemic or class-wide discrimination. Under the ACE Directive, an onsite will be triggered by indicators of any sort of discrimination. The Directive says that discrimination can be indicated by statistical indicators, anecdotal evidence, patterns of individual discrimination, patterns of systemic discrimination, patterns of major technical violations involving recordkeeping or failure to maintain an AAP, and indications of noncompliance with other labor and employment laws administered by other federal agencies. Stating that discrimination may be indicated by patterns of "major" recordkeeping violations or by non-compliance with other laws that have nothing to do with discrimination is a very aggressive and some might argue unfair approach. For example, the ACE directive says that a contractor's violation of wage hour laws can be an indicator of possible discrimination.

OFCCP has said that it intends to conduct fewer audits in the future but that those it does conduct will be more detailed and thorough. The procedures adopted in the ACE directive certainly confirm that when OFCCP calls on you for an audit in the future there is a far greater likelihood of a longer, more aggressive encounter with the agency.
 

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Updating our previous posts on Thompson v. North American Stainless, the Supreme Court yesterday reversed the Sixth Circuit’s en banc decision holding that an employee who claims he was fired in retaliation for his fiancé's complaint of sex harassment had an actionable retaliation claim under Title VII. The Supreme Court reversed the Sixth Circuit’s decision in a 8-0 opinion with Justice Scalia writing the unanimous decision.

The facts are as follows: A woman filed a sex discrimination charge with the EEOC. Three weeks later, the employer terminated the woman’s fiancé, who also was employed by the company. The fiancé filed his own EEOC charge and, eventually, a lawsuit, alleging that his termination was in retaliation for his fiancé’s EEOC charge. In response, the employer argued, among other things, that there is no cause of action under Title VII for retaliation against associated third-parties. The trial court agreed and dismissed the case. The plaintiff appealed, and the EEOC filed an amicus (“friend of the court”) brief in support of associational retaliation claims. In a 2-1 decision, a three-judge panel of the Sixth Circuit reversed, holding that “Title VII prohibit[s] employers from taking retaliatory action against employees not directly involved in protected activity but who are so closely related to or associated with those who are directly involved, that it is clear that the protected activity motivated the employer’s action.” The entire Sixth Circuit (en banc) reversed the three-judge panel holding in a close 10-6 vote that there was no cause of action for third-party or associational retaliation.

Yesterday, the Supreme Court reversed the Sixth Circuit’s en banc decision, agreeing with the plaintiff that Title VII’s provisions prohibiting retaliation were broad enough to include associated third-parties. The Supreme Court reasoned that Title VII’s anti-retaliation provisions were intended to protect against any employer action that may dissuade a reasonable worker from making or supporting a charge of discrimination—specifically emphasizing that this is an objective standard. The Court reasoned that it was “obvious” that a worker might be dissuaded from making or supporting a complaint of discrimination if she knew that her fiancé might be terminated as a result. The Court reasoned that hurting the fiancé was the means by which the employer intended to harm the female employee making the complaint of discrimination. The Court warned that retaliation against a mere acquaintance would not meet this standard but declined to identify specific relationships that would and would not be covered—holding that outside of close family relationships it would depend on the circumstances of each case to determine whether the plaintiff was in the "zone of interest."

Retaliation claims have long been a thorn in the side of employers, who too often make the mistake of transforming a meritless discrimination claim into a viable retaliation claim by the way they treat an employee who remains in their employ after complaining of discrimination. The Supreme Court's 2006 decision in Burlington Northern & Santa Fe Ry. Co. v. White made it easier for employees to prove retaliation and yesterday's decision in Thompson expands the list of potential retaliation claimants. With retaliation claims already on the rise as demonstrated by the EEOC's recent statistics, it is more important than ever that employers thoroughly and impartially evaluate any disciplinary scenario before taking adverse action to ensure that the discipline is free of any retaliatory motivation.
 

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There has been a lot of discussion lately about the EEOC's decision to sue Kaplan Higher Education Corporation on the grounds that its policy of using credit histories as part of its applicant screening process had a discriminatory impact on minorities. Also, as noted at the end of last year in the Delaware Employment Law Blog, Illinois just became the fourth state to prohibit employers from disqualifying candidates based on credit history and, as of last summer, 15 other states had similar legislation pending. Ohio's bill, which was introduced in 2009, never gained any traction. Though I continue to believe that an outright ban on employer credit history checks is overbroad, the Federal Trade Commission's Interim Report to Congress issued earlier this week provides another reason why employers should exercise considerable caution in doing such checks. 

The FTC's Interim Report demonstrates that the accuracy of credit history reports remains an open question. The FTC is in the process of a study that will have 1,000 random consumers review their credit reports with an "expert who will help identify potential errors on their reports. Participants will be encouraged to dispute errors that could affect their credit standing, and credit reports with alleged errors will be sent to Fair Isaac Corporation (FICO) for rescoring. The study will estimate the proportion of consumers who would find one or more material errors in their credit reports, and it will reveal the main types of errors, their frequency, and their impact on a consumer’s credit standing. Overall, the study will categorize errors by type and seriousness in terms of potential consumer harm."

It looks like we have quite a wait ahead of us before any conclusions are reached on the general accuracy of credit reports. According to the FTC, the data collection phase of the study will not be finished until October 2011, and the Commission’s next interim report to Congress, which is intended to provide a full analysis of the collected data, is not due until December 2012. In the meantime, both the EEOC's new aggressive approach to credit history checks and the rise of legislation outside of Ohio suggests that employers consider whether there is a business necessity for seeking credit history on employment candidates.

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According to statistics released by the Equal Employment Opportunity Commission (“EEOC”) earlier this week, the Agency received over 7% more charges in 2010 than it did the previous year—99,922 as compared to 93,277.  Indeed, the number of charges filed were up in every category.  The FY 2010 enforcement and litigation statistics, which include trend data, are available online here.

Such statistics are not surprising in light of the large number of layoffs that occurred in 2010, coupled with the difficulties terminated employees had in finding new employment in a down economy.  What is more interesting, however, is that, for the first time since the EEOC became operational in 1965, race was not the most prevalent category of alleged discrimination. Rather, retaliation under all statutes (36,258) surpassed race (35,890) as the most frequent basis for filed charges. This should serve as a clear reminder to employers that they must be particularly careful in dealing with employees who have filed charges or made internal complaints and understand that retaliation is prohibited even if the underlying charge or complaint lacks merit.

It is also noteworthy that, in the first year of its enforcement, the EEOC received 201 charges under the Genetic Information Nondiscrimination Act (“GINA”).  As employees become more familiar with the provisions of this Act, it is likely that the number of charges under it will increase considerably in years ahead.

There are signs that the economy will rebound in 2011, which would be a welcome relief to all who have felt its impact.  Of course, whether that actually occurs or not remains to be seen.  In the meantime, employers should be vigilant in making sure their employment decisions are nondiscriminatory because there is an increased likelihood in difficult economic times that these decisions will be challenged.

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According to a complaint filed this week in New York, two licensed massage therapists, Christina Scavo and Shannon O'Toole, claim that the New York Jets never called them back to provide therapy for the Jets after Scavo's husband called Favre to complain during training camp in 2008 that he had propositioned her by text message. O'Toole claims that she was blacklisted by the Jets because she introduced Scavo to the Jets. Neither plaintiff apparently complained to the Jets following the alleged proposition or at anytime while Favre was still playing for the Jets and there is no indication that Favre continued to proposition Scavo after her husband's call. 

But in October 2010, Deadspin.com reported the incident without naming the two women.  Thereafter, the team's "massage coordinator" allegedly sent text messages to Ms. Scavo attacking her for going to the press and not contacting her directly to handle the situation. She also reportedly told O'Toole that she would never work for the Jets again. If the plaintiffs' complaint correctly quotes her text messages to Scavo, the "massage coordinator" appeared to be unfazed by the allegations against Favre and also appeared to acknowledge that prior similar incidents had been handled internally by the Jets.

Of course, the Jets and Favre have been no strangers to these types of allegations recently, which only serves to enhance the plaintiffs' allegations of a hostile work environment. Nevertheless, there are some interesting twists to this case from a defense perspective. It appears that neither Scavo nor O'Toole actually were employed by the Jets so it is questionable whether a cause of action exists under the state, city and county laws upon which they base their Complaint. If a cause of action does exist, Plaintiffs' biggest hurdle would be their failure to report anything to Jets management for more than two years. Regardless, the allegations raise an important issue for employers. 

Specifically, employers need to re-examine their willingness sometimes to overlook inappropriate conduct by their "superstar" employees. Now, I am aware of no evidence that the Jets knew of Favre's apparent texting habits while he was employed there, but that fact would call into question the effectiveness of the Jets' communication of their sexual harassment policies -- particularly in light of prior allegations against Favre made by Jets' sideline reporter Jenn Sterger. If the Jets were aware of Favre's text messages, this situation very clearly demonstrates that an employer cannot afford to permit any employee, no matter how valuable they may be, to consider themselves above the law. Brett Favre's tenure in New York was very short-lived, but the Jets are still paying the price. 

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The Office of Contract Compliance (OFCCP), which enforces federal contractors’ and subcontractors’ affirmative action obligations, recently rescinded its 2003 ACM directive. The 2003 ACM or "Active Case Management" directive allowed for abbreviated desk audits where only the affirmative action plan and personnel data were reviewed. If no evidence of systemic discrimination was revealed (defined as discrimination affecting at least 10 employees or applicants), the evaluation would be closed. If such evidence was indicated, a full desk audit and possible onsite review would be launched. The ACM also mandated that a full desk audit be performed for every 25 contractors and a full onsite review for every 50 contractors.

Rescinding the ACM directive signals that desk audits may be more expansive in the future and that onsite reviews may become more common. However, the rescission may be just a formality. Many contractors found that some regional and local OFCCP offices had not been following the ACM directive for some time, but formally rescinding the ACM directive does signal that the agency intends to be more aggressive in its enforcement activity.  The OFCCP has yet to issue new procedures for desk audits and onsite reviews.

With a renewed focus on onsite reviews, the OFCCP will be able to expand its enforcement efforts to other areas of affirmative action, rather than just focus on what the statistics reveal.  For example, in an onsite review, the OFCCP can look at disabled accessibility issues, posting requirements, and interview workers.

We will update you if a new directive replacing the ACM is issued.

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Yesterday, the Sixth Circuit announced its decision in Jakubowski v. The Christ Hospital, Inc. which very well demonstrates the attention that employers need to pay to the interactive process when an employee approaches it for a reasonable accommodation for a disability.   

Jakubowski was a family medicine resident at Christ Hospital, which noted a number of deficiencies in his performance due to cognitive issues that were later diagnosed as Asperger’s.  Specifically, Jakubowski was having difficulty communicating his thoughts to people and processing what people communicated to him.  Upon receiving the Asperger’s diagnosis, Jakubowski’s attorney contacted the hospital proposing that it accommodate Jakubowski’s disability with “knowledge and understanding.”  In other words, Jakubowski believed that he could successfully continue his residency if the hospital employees were made aware of his condition and its symptoms and triggers.  He acknowledged that he would still need to improve his patient communication skills, but insisted he could do that on his own.

The hospital met with Jakubowski about the proposed accommodation, but advised him that it did not have sufficient resources to comply.  The hospital, however, offered to assist Jakubowski in finding a residency in pathology, a field that requires little or no patient interaction.  When the parties could not agree on an accommodation, Jakubowski was terminated and later filed a lawsuit.  During the course of discovery, Jakubowski presented expert testimony identifying many ways in which the hospital could have accommodated his Asperger’s that apparently had not been considered by either Jakubowski or the hospital.  In response, the hospital presented expert witnesses who offered opinions suggesting that Jakubowski's inability to communicate with other hospital employees and patients endangered the patients’ safety.  The U.S. District Court for the Southern District of Ohio granted the hospital’s motion for summary judgment, finding that Jakubowski was not “an otherwise qualified individual” entitled to the protections of the ADA and Ohio disability discrimination laws.

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In the day-to-day administration of their Ohio workers’ compensation programs, self-insured employers (or a TPA or law firm on their behalf) often will obtain a medical authorization from the injured worker and then obtain medical records as part of the employers’ medical investigation. Though the authorization is often limited to specific injuries or body parts, they are just as likely not to be so limited. In addition, despite HIPAA requirements, healthcare providers often produce records in excess of what has been authorized (presumably because they don’t want to take the time or effort to cull through the records and produce only what has been asked for.)  As a result, the records obtained frequently will include medical information wholly unrelated to the alleged workers’ compensation injuries and sometimes that information reveals genetic information, such as whether an individual had a test done to determine whether she is at greater risk for breast cancer.  Hospital records are notorious for including family history information that may reflect, for instance, that a parent died of cancer or a heart attack at a relatively young age, even when the individual went to the hospital only to have an injured knee looked at.

As a result, in the workers’ compensation context, employers are frequently obtaining genetic information even though they really haven’t asked for it.  Should the EEOC’s final rule on Title II of GINA then have any impact on employers’ approaches to their medical investigations conducted in the defense of workers’ compensation claims?  Though the rule states that GINA is not intended to “limit or expand the protections, rights, or obligations of employees or employers under applicable workers’ compensation laws,” does that language provide clearance to employers to obtain through its workers’ compensation administration what otherwise would be protected genetic information?  According to the EEOC, “genetic information” does not include the fact that an individual has a diagnosed disease, disorder, or pathological condition, so it is difficult (at least for me) to come up with examples of situations when an employer would need genetic information on an employee to assist in the defense of a workers’ compensation claim.  Therefore, one could argue that application of GINA to an employer’s medical inquiries and examinations for workers’ compensation purposes does not limit an employer’s rights or expand an employee’s protections under the workers’ compensation laws.

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Earlier this week, the EEOC issued its final rule implementing Title II of the Genetic Information Nondiscrimination Act of 2008 (GINA), which was published in the Federal Register on Tuesday, November 9, 2010. As promised, we are following up with our analysis of the EEOC’s new rule.

The proposed regulations were issued in March 2009 for public comment. Title II took effect almost a year ago on November 21, 2009, before the regulations were finalized. GINA prohibits the use of genetic information in employment decisions and restricts employers and other entities from requesting, requiring or purchasing genetic information. Title II also requires that genetic information be maintained as a confidential medical record, and places strict limits on its disclosure. 
 

GINA applies to an individual’s status as an employee, member of a labor organization, or participant in an apprenticeship program. The final rule, like the proposed rule, includes applicants and former employees in the definition of employee. 
 

The regulations clarify that they do not apply to an employer’s actions that do not pertain to an individual’s status as an employee, such as a law enforcement agency investigating criminal conduct, even where the subject of the investigation is an employee, or a healthcare facility providing a medical examination to an employee for the purpose of diagnosis and treatment unrelated to employment. 

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This morning, the EEOC announced its final rule to implement Title II of the Genetic Information Nondiscrimination Act of 2008, which is to protect job applicants, current and former employees, labor union members, and apprentices and trainees from discrimination based on their genetic information.  We will address the rule’s highlights in the next day or so.

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Earlier this week, we reported on a New York Times article about employer efforts to address the impact of prescription drugs in the workplace. The article profiled workers at the Dura Automotive Systems Inc. plant in Lawrenceburg, Tennessee who were terminated for testing positive for prescription drugs that Dura considered to raise safety issues. Yesterday, the Sixth Circuit handed down a decision in a case that challenged the company's drug testing policy. 

In that decision, the Court held that several of the workers could not challenge their terminations under that policy because they were not "qualified individuals with a disability" under the ADA. The employees had claimed that under Section 12112(b)(6), the drug testing policy constituted a “qualification standard, employment test, or other selection criteria” that “screen out or tend to screen out” persons with disabilities. But, the court held that “a straightforward reading of this statute compels the conclusion that only a ‘qualified individual with a disability' is protected from the prohibited form of discrimination described in subsection (b)(6)—the use of qualification standards and other tests that tend to screen out disabled individuals.” The Court distinguished Section (b)(6) the ADA from Section (d)(4), which provides that employers may not require a medical examination and shall not make inquiries of an employee as to whether such employee is an individual with a disability or as to the nature or severity of the disability, unless such examination or inquiry is shown to be job-related and consistent with business necessity. Many courts have held that an employee does not need to have an ADA-protected disability to pursue a lawsuit under Section (d)(4). 

The Sixth Circuit's decision is certainly good news for employers, particularly for those in Ohio, which lies within the Sixth Circuit. But in order to avoid lawsuits challenging the testing itself, employers must still be able to demonstrate that any drug testing for prescription drugs is not only job-related but also required by business necessity. In separate litigation brought by the EEOC against Dura, Dura apparently is attempting to defend its testing program based on evidence that suggests that the Lawrenceburg facility has a higher accident rate than other comparable facilities. In addition, the New York Times article suggests that there was evidence of drug use and sales going on at the plant.   It will be interesting to see how the Sixth Circuit addresses that issue if the EEOC case gets that far.

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The U.S. Department of Justice this week announced a settlement with Catholic Healthcare West and two subsidiaries over alleged document abuse violations related to hiring practices. The Justice Department determined that the employer violated the discrimination provisions of the Immigration Act by permitting native-born U.S. citizens to choose which documents to provide but demanding additional documents from non-citizens and naturalized citizens. While the law requires the employer to verify employment authorization, the employer may not discriminate against non-citizens or naturalized citizens.  The Justice Department alleged that by requiring additional documentation, the employer had crossed the line from verification to discrimination. 

The settlement included several provisions. Catholic Healthcare West agreed to pay $1,000 in back pay and offer employment to the individual who brought the claim and pay a $257,000 civil penalty to the government.  In addition, there were strict provisions for further monitoring of the employer's practices and records, with frequent reports to the Government over the next several years.  The key factor cited to justify the assessment of damages and the fine was that the employee was required to miss work to get the additional documentation. 

This settlement highlights the fine line that employers must walk on I-9 verification issues.  We have seen a steady increase over the past few years in the fines and penalties assessed against employers for the failure to properly verify new employees' authorization to accept employment.  This penalty was assessed against an employer who requested too many documents as part of that verification process.  The very expensive lesson that Catholic Healthcare West learned was that employers must verify each new employees' employment authorization but must be very careful to avoid a request for too much documentation, which will be considered unlawful discrimination. 
 

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Over the last week or so, two stories about drugs in the workplace caught my eye. First was the NY Times article on employer efforts to respond to the increasing use of prescription drugs in the workplace. The article appropriately addressed the conflict between employer needs to ensure a safe workplace and employee rights to privacy and the protections afforded by the ADA. As a result, some employers have begun testing employees for prescription painkillers and other prescription drugs and terminating employees that test positive. 

The second issue in the media this past week involved the disclosure that officials from the Houston Texans last month conducted a search of the team's locker room for evidence of performance enhancing drugs. Earlier this season, two Houston players had been suspended under the NFL's substance abuse policy. Surprisingly, neither the Texan players nor the NFLPA seem to have (at least publicly) complained about the search.  (You can read more about this story here.)

These two stories show the lengths to which employers are going to combat drugs in their workplaces. Before taking any drastic approaches towards addressing a drug problem in their workplace, employers would be wise to consult their labor and employment counsel to ensure that their approach is lawful.

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Last Wednesday, the EEOC held a public meeting at which it took testimony to address the perceived ills associated with the use of applicant credit histories in making hiring or other employment decisions. With unemployment at such high levels across the country, employer credit checks have come under greater scrutiny. Back in August, Illinois enacted the Employee Credit Privacy Act, which prohibits, with limited exception, an employer from using a person’s credit history in making employment decisions. 

As we reported last year, Ohio's legislature considered a credit check ban as well, but that bill went nowhere. The EEOC's press release can be accessed here and the panelist statements can be accessed here.

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In an earlier post, we discussed the type of case that lends itself to pre-filing or pre-discovery mediation. But unless the key motivating factors needed for pre-suit or pre-discovery mediation are present, mediating employment cases after early, limited discovery provides parties with one of the best chances for expeditious resolution. It allows everyone to reduce the time and the costs involved to resolve a litigated employment dispute.

As lawyers, we know that it may be difficult or next to impossible to evaluate a party’s claims or defenses without some discovery. For an employee, the employer usually has the relevant documents and witnesses in its control. The employee’s counsel often recognizes the importance of serving requests targeted at key documents and deposing at least one key witness or company representative. This allows an employee to assess the risk of continuing litigation and shows that commitment to pursing evidence to support the claims.

For employers, deposing the employee is often critical to its defense and assessing the suitability of settling a case in a mediated process. This may be essential in “he said, she said” cases where witness credibility may be dispositive. An employer may also use the deposition to show an employee that litigation may be a long and difficult road; or that there are some issues that the employee had not anticipated. 

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There are times when parties want to avoid litigation as a means for resolving a dispute. Some employment disputes are particularly well-suited to pre-filing or pre-discovery mediation. For example, in a case where the reputation of an individual or an organization is at stake, there is a great chance that early mediation will result in resolution. A party faced with disclosure of damaging information and the unavoidable publicity that may result, often sees a resolution in mediation as the best option. Pre-suit mediation is also favorable to the party possessing the damaging information since once a lawsuit is filed, it has lost some of its leverage. These type situations are ideal for pre-suit or pre-discovery mediation.

Another time pre-filing mediation is particularly fitting is when the remedy sought involves little money and is relatively easy to implement. Cases involving failure to accommodate under the ADA, failure to offer leave under the FMLA, or single-party claims under the FLSA are some examples. Here, pre-suit mediation is practical.

Pre-filing mediation may also enhance the possibility of resolution in disputes where there is or may be an ongoing relationship. This is true, for instance, in cases involving failure to accommodate or to offer leave, where the parties may want to continue the employment relationship.

Still another opportunity for pre-suit or pre-discovery mediation is when parties lack the financial or emotional wherewithal to see a case through. The parties may be aware of weaknesses in their claims or defenses, may have less than ideal witnesses, or may want to avoid costly discovery. There are virtually limitless concerns parties may have, including, avoiding disclosure of confidential medical records, comparator information or financial data. Mediation in situations like these can be especially cost-effective.

As mediators and mediation advocates, we know that every day great minds meet to resolve problems in mediation. But when to meet may have significant impact on the likelihood of resolution, so when litigation is threatened or anticipated, decision makers and their counsel should consider whether pre-suit or pre-discovery mediation is appropriate. Decision makers should weigh the benefits of early mediation against the risk and uncertainty of going forward, and then explore the opportunities and benefits pre-suit mediation offers. 
 

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The federal health care reform legislation passed in March of this year included an amendment to the Fair Labor Standards Act (FLSA), requiring employers to provide reasonable unpaid break time to nursing mothers to express breast milk for the nursing child. The requirement to provide breaks extends for one year after the child is born. The DOL has just released a fact sheet with general information about the requirements.

Briefly, the law requires that employers provide "reasonable break time... each time such employee has need to express milk." Employers must provide a private location, free from intrusion, other than a bathroom, for purposes of the break.

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As an update to my earlier post on the Sixth Circuit's decision on third party or associational retaliation claims, the United States Supreme Court has agreed to review this decision.

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Employers may want to pay attention to recently introduced H.B. 470. The Bill was introduced by Representative Stephen Dyer (D-43rd District) and co-sponsors Mark Okey (D-61st District), John Domenick (D-95th District), Raymond Pryor (D-85th District), and Robert Hagan (D-60th District) on March 23, 2010. H.B. 470 would create a cause of action against employers that discriminate against individual job applicants or employees because they smoke tobacco. If enacted, H.B. 470 would prohibit employers from refusing to hire individuals or otherwise discriminating against individuals with respect to the terms, conditions, and privileges of employment because they smoke tobacco. The bill does not impact an employer’s ability to establish policies prohibiting smoking “or smelling like tobacco smoke” during work hours.

The bill does not explicitly include any private remedies for the applicant who is not hired or the employee who is fired. Instead, any employer who violates this provision is subject to civil liability and is subject to escalating fines, including (1) $25,000 for the first offense, (2) $50,000 for the second offense, and (3) $100,000 for each subsequent offense. 

H.B. 470 is still in the early stage of the legislative process. However, we will continue to keep you updated if the bill gains any traction.

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On February 19, 2010, the Second Circuit Court of Appeals vacated a district court decision and reversed JetBlue Airways’ favorable summary judgment in a case brought by a former customer service supervisor who complained to her supervisor, who was also the alleged harasser, about a hostile work environment because other avenues of complaint may have appeared to be futile.

The employee alleged that over a seven-month period her supervisor made several remarks about wanting to massage or suck on a woman’s breasts, remarked about going home so that his wife could attend a “sex toy” party and asked a female coworker whether she had “gotten enough loving” over the weekend. Other employees testified that the supervisor grabbed female crewmembers, that he frequently made inappropriate comments and gestures, and that he stared at them as if he was mentally undressing them.

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In response to two U.S. Supreme Court decisions, the U.S. Equal Employment Opportunity Commission (EEOC) has released for public comment a proposed rule construing the “reasonable factor other than age” (RFOA) defense under the Age Discrimination in Employment Act (ADEA). 

In Smith v. City of Jackson and Meacham v. Knolls Atomic Power Company, the Supreme Court held that the RFOA defense acts as a complete bar to disparate impact liability where an employer demonstrates that its facially neutral policy or practice, which had a disparate impact on older workers, was based on a reasonable factor other than the plaintiff’s age. Although the RFOA defense operates similarly to Title VII’s business necessity defense, this defense under the ADEA has traditionally been more “employer-friendly” because it preserves an employer’s right to make reasonable business decisions while protecting older workers from facially neutral employment criteria that arbitrarily limit their employment opportunities without requiring a showing of business necessity.

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In Thompson v. North American Stainless LP, in a rehearing by the Sixth Circuit en banc, the full Sixth Circuit held that, in order for a third-party to claim retaliation based on the protected activity of another, the third party must have actually engaged in protected activity of his own. In doing so, the Sixth Circuit joined the Third, Fifth, and Eighth Circuits in so ruling.

In Thompson, a woman filed a sex discrimination charge with the EEOC.  Three weeks later, the employer terminated the woman’s fiancé, who also was employed by the company. The fiancé filed his own EEOC charge and, eventually, a lawsuit, and alleged that his termination amounted to retaliation for his fiancé’s EEOC charge. In response, the employer argued, among other things, that there is no cause of action under Title VII for retaliation against associated third-parties. The trial court agreed and dismissed the case. The plaintiff appealed, and the EEOC filed an amicus (“friend of the court”) brief in support of associational retaliation claims.

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 Yesterday, the EEOC released its charge statistics report for its 2009 fiscal year, which ended on September 30, 2009. Not surprisingly, during an economically difficult period, the statistics show a near record number of charges filed -- 93,277 -- which is second only to the 2008 fiscal year when 95,402 charges were filed.

As usual, sex and race discrimination charges led the pack, but they also showed a slight decline from the previous fiscal year. Somewhat surprisingly, during a period that saw extensive reductions-in-force, age discrimination charges were significantly down. On the other hand, disability discrimination and retaliation charges showed the sharpest increase, both numerically and statistically.

The increase in disability discrimination charges likely can be tied directly to the enactment of the Americans with Disabilities Act Amendments Act (ADAAA) which makes it significantly easier for applicants and employees to establish that they have a protected disability. Employers can reduce the likelihood of being targeted for a disability discrimination charge by recognizing this new reality and engaging in good faith in the interactive process to determine whether a reasonable accommodation exists for applicants or employees with alleged disabilities. Frequently, the give and take of the interactive process if conducted in good faith will either result in finding an accommodation that both sides can live with or demonstrating to the applicant or employee's satisfaction that no reasonable accommodations actually exist. Remember, the ADA, even as amended by the ADAAA, still does not require the employer to provide applicants or employees with the accommodation they want -- only a reasonable one.

With respect to retaliation charges, as we have preached in previous posts both here and here, employers must be careful to treat employees who have filed discrimination charges or lawsuits as they would treat any other employee -- no better, no worse. In fact, the U.S. Supreme Court's decision in Crawford v. Metro. Gov’t of Nashville and Davidson County early in the 2009 term held that the retaliation protection provided by Title VII extend to employees who speak out about discrimination during the employer’s investigation into another employee’s internal complaint of discrimination. The Crawford decision, therefore, underscores employers' need to protect themselves from potential retaliation cases in this context as well by following up on any employees who claim "me too" in the course of internal discrimination investigations.

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The EEOC has revised its "Equal Employment Opportunity is the Law" poster. This new version reflects current federal employment discrimination law (including the Americans with Disabilities Act Amendments Act of 2008). The poster was revised to add information about the Genetic Information Nondiscrimination Act of 2008, which becomes effective November 21, 2009. The revised poster also includes updates from the Department of Labor.

Follow this link to obtain the new poster.

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When the Ohio Supreme Court agreed to hear the appeal in Allen v. Totes/Isotoner, it was widely expected that the Court would address the question of whether Ohio's pregnancy discrimination laws required employers to allow a woman who is breastfeeding to take unscheduled lactation breaks. Instead, a fractured court rendering five separate opinions (as well as the conclusion of Justice Lanzinger that she would have dismissed the appeal as having been improvidently accepted) dodged the question. 

The per curium opinion, which was joined in only by Justices Lundberg Stratton, O'Donnell and Cupp, upheld summary judgment in favor of Isotoner on the ground that Isotoner terminated Ms. Allen for what she agreed were unauthorized breaks from her work station. As a result, the per curium decision stated that it was unnecessary for the Court to address the issue of whether discrimination due to lactation was prohibited by Ohio's discrimination laws.

Justice O'Donnell then wrote separately in an opinion joined by Justices Lundberg Stratton and Cupp to emphasize his view that in light of the facts in the Allen case, any opinion of the Court on the question of whether "discrimination due to lactation" would have been an improper advisory opinion.

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CNN.com is reporting that a group of Philadelphia policemen and women have filed a class action lawsuit in federal court against the Philadelphia police department for race discrimination on the ground that the department allegedly permitted its white officers, including some of supervisory rank, to maintain a private website that allegedly was used as a forum for racially offensive comments. It is alleged that the website created a hostile work environment, in part, because it was both accessed and discussed in the workplace. Although the police department has disavowed any responsibility for the website, which was password protected, questions necessarily will arise regarding whether the department had knowledge of the content on the website and acquiesced to it and whether it permitted the site to be operated during work time. Even if the department can establish it did not sanction or condone the website, the lawsuit still raises a number of interesting issues as to the extent to which an employer can be held liable for discriminatory and/or harassing conduct of its employees by supervisors while they all are off duty.

We don't know whether the police department had a policy regulating its officers' internet access, either on duty or off duty. Such a policy, if it exists and was enforced, might support the department's attempt to distance itself from the racially-charged comments on the website. Similarly, the content and enforcement of its policy against harassment will undoubtedly be scrutinized in the months ahead. As it stands, the department faces what looks to be an arduous legal battle. In addition, the department undoubtedly will need to take action internally to ensure that any future employment decisions, such as promotions and terminations, aren't tainted by the allegations in this complaint.

Here is a link to the CNN article: http://www.cnn.com/2009/CRIME/07/17/police.racism.lawsuit/index.html, which appropriately warns that the complaint -- to which it links -- may be highly offensive to some.

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On July 15, 2009, the EEOC published “Understanding Waivers of Discrimination Claims in Employee Severance Agreements,” a document directed to employees facing layoffs. The publication is not apparently intended to change existing regulations, but rather to summarize the legal requirements for severance agreements under the ADA, Title VII, the Equal Pay Act, and, separately, the Age Discrimination in Employment Act.

As noted by the EEOC’s summary, in order to minimize the risk of potential litigation, many employers provide laid-off employees with optional severance agreements, by which employees may obtain certain compensation or benefits in exchange for releasing the employer from liability. The EEOC document specifically addresses the validity of such releases, and it is therefore useful reading for employers as well.

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Generally, the firing of a professional sports team's general manager is not going to raise my interest as an employment lawyer, but the comments made by the owner of the Chicago Blackhawks after Dale Tallon was fired certainly piqued my interest. Those hockey fans in the audience may know that Tallon's firing came shortly after the NHLPA filed a grievance claiming that he failed to send out timely qualifying offers to players that were restricted free agents. Rather than risking those players becoming unrestricted free agents, Tallon quickly signed them to long term contracts that probably aggravates the team's salary cap issues in the near term and ultimately may cost the team more money.

In an effort likely designed to deflect attention from this blunder, Rocky Wirtz, the Blackhawks owner, is quoted by MSNBC.com as follows regarding Tallon's replacement: Asked what Bowman, who's in his ninth year with the Blackhawks, brings to the job that Tallon didn't, Wirtz said: "He's 36, Dale is 58. We always want younger people. What he brings is a system in place to get better," Uh oh.

Fortunately for the Blackhawks as it relates to Tallon's situation, the recent Supreme Court decision in Gross v. FBL Financial Services probably saves them from a potential claim of age discrimination. As reported previously, Gross holds that a plaintiff bringing an ADEA disparate-treatment claim must prove, by a preponderance of the evidence, that age was the “but-for” cause of the challenged adverse employment action. Here, John McDonough, the Blackhawks president who appears to have been the driving force behind the termination, acknowledged that Tallon probably would not have been fired if not for the free agent incident. For future reference, however, the Blackhawks may want to keep tabs on Congress, which already has announced that it will hold hearings directed at overturning the Gross decision.

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On June 29, 2009, the Supreme Court addressed a provocative question about the current state of workplace diversity in the United States. In the controversial Ricci v. DeStefano decision, the Court determined by a vote of 5-4 that only in very narrow circumstances can public employers engage in disparate-treatment discrimination to avoid violating the disparate impact provision of Title VII of the Civil Rights Act. In order to make a race-conscious preventative decision, an employer must have a strong basis in evidence that a given selection method was deficient and that discarding that method’s results is necessary to avoid creating a disparate racial impact.

Title VII protects employees from two types of discrimination based upon race, color, religion, sex, and national origin: intentional acts of discrimination (disparate treatment), and facially neutral policies and practices that have a disproportionate adverse effect on minorities (disparate impact).   If an employee makes a prima facie showing of disparate impact discrimination, the burden then shifts to the employer to prove that the practice in question is job related and consistent with business necessity. Even if the employer meets this burden, a plaintiff may still succeed by showing that the employer refuses to adopt an available alternative employment practice that has a lesser disparate impact and serves the employer’s legitimate needs. Ricci posed the question of under what circumstances an employer may take race-conscious action to avoid disparate-impact liability given this statutory scheme.

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One month ago, we discussed a bill introduced in the Ohio General Assembly to prohibit discrimination on the basis of sexual orientation and gender identity and expression. Representative Barney Frank (D-Mass.) recently introduced a similar bill in Congress to prohibit employment discrimination on the basis of sexual orientation and gender identity, The Employment Non-Discrimination Act of 2009, H.R. 2981. This bill, which has been referred to committee, defines “gender identity” as “the gender-related identity, appearance, or mannerisms or other gender-related characteristics of an individual, with or without regard to the individual’s designated sex at birth.” This language is similar to the proposed definition of “gender identity and expression” under the Ohio bill. This proposed bill, like the Ohio proposal, also includes broad protection of “actual or perceived” sexual orientation. The language in the proposed federal statute limits potential claims under the Act to disparate treatment and retaliation actions only, expressly excluding disparate impact claims. The procedures and remedies for violations of the Act are the same as those provided under Title VII. The proposed federal statute, like the proposed Ohio statute, expressly excludes religious organizations that are exempt from Title VII’s religious discrimination provisions.

The proposed federal statute, in contrast to the Ohio proposal, directly addresses grooming standards and restroom, shower, and changing facility usage. Under the federal proposal, employers may deny, on the basis of gender identity, employees access to changing areas or showers where being seen unclothed is “unavoidable”—if the employer provides “reasonable access” to adequate facilities “not inconsistent with the employee’s gender identity” determined at the time of employment or when the employee notifies the employer that he/she is undergoing/has undergone gender transition. The federal proposal also allows for reasonable dress and grooming standards—provided the employer allows employees who are undergoing, or who have undergone, gender transition to adhere to the standards for the gender to which the employee transitioned or is transitioning. 

We’ll provide updates as additional information becomes available.

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So-called “mixed motive” cases, where there is evidence of unlawful bias but also evidence of a legitimate, nondiscriminatory reason for an employment action, have generated a great deal of debate over the applicable burden of proof. In 1989, a divided U.S. Supreme Court held in Price Waterhouse v. Hopkins that, once a plaintiff has proven that unlawful animus was “a motivating factor” in an employment decision, the burden of proof shifts to the defendant to prove that it would have taken the same action even absent the unlawful animus. This approach was essentially ratified by Congress when it approved certain amendments to Title VII in enacting the Civil Rights Act of 1991. But, because Price Waterhouse applied to a claim under Title VII, and federal age discrimination claims fall under the Age Discrimination in Employment Act (ADEA), which was not similarly amended by the Civil Rights Act of 1991, the burden of proof applicable to mixed-motive ADEA cases has remained in dispute.

On June 18, 2009, the U.S. Supreme Court resolved this dispute in Gross v. FBL Financial Services, holding that the burden of proof for an ADEA claim remains with the plaintiff at all times, even in a mixed-motive case. The Court’s 5-4 decision relied heavily on the differences in statutory framework between the ADEA and Title VII in distinguishing the result in Price Waterhouse. The majority opinion, written by Justice Thomas, pointed out that the ADEA required the plaintiff to prove that he was demoted “because of” his age and that there is no statutory basis to shift the burden of proof to the defendant simply because the plaintiff produced some evidence that age was one motivating factor in the decision. The plaintiff still retained the burden of proof to demonstrate that he would not have been demoted “but for” his age.

 
With Congress all too willing these days to enact legislation overturning employment law decisions of the Supreme Court that displease it, it will interesting to see how long the holding in Gross stands. 

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In April 2008, I reported that a divided three-judge panel of the Sixth Circuit in Thompson v. North American Stainless LP held that an employee may sue for retaliatory acts against him by his employer in response to protected activity by a related employee—a close friend or family member. This decision was in contrast to the decisions of the Third, Fifth, and Eighth Circuits rejecting associational retaliation claims. After rehearing en banc by the Sixth Circuit (by the entire court), the Court joined its sister circuits in rejecting a cause of action for associational retaliation in a narrowly-divided opinion.

In Thompson, a woman filed a sex discrimination charge with the EEOC. Three weeks later, the employer terminated the woman’s fiancé, who it also employed. The fiancé filed his own EEOC charge and, eventually, a lawsuit, and alleged that his termination amounted to retaliation for his fiancé’s EEOC charge. In response, the employer argued, among other things, that there is no cause of action under Title VII for retaliation against associated third-parties. The trial court agreed and dismissed the case. The plaintiff appealed, and a divided three-judge panel of the Sixth Circuit reversed and held that Title VII provides a cause of action for retaliation in response to a related employee’s protected activity. The court defined this new cause of action stating, “Title VII prohibit[s] employers from taking retaliatory action against employees not directly involved in protected activity but who are so closely related to or associated with those who are directly involved, that it is clear that the protected activity motivated the employer’s action.” (Emphasis added.) In so holding, the panel closely examined the Supreme Court’s definition of “retaliation”—that which would “dissuade[] a reasonable worker from making or supporting a charge of discrimination.” (Quoting the U.S. Supreme Court’s decision in Burlington Northern and Santa Fe Railway Co. v. White, 126 S.Ct. 2405 (2006).) 

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Last week, a United States District Court Judge for the Eastern District of Pennsylvania issued one of the few decisions thus far to analyze the reach of the Lilly Ledbetter Fair Pay Act.  In Rowland v. CertainTeed Corp., 2009 U.S. Dist. LEXIS 43706, Judge Schiller held that the Ledbetter Act’s extension of the statutory time period for claiming pay discrimination does not apply to a failure-to-promote case. In so holding, Judge Schiller reasoned that Congress limited the Ledbetter Act to claims of “discrimination in compensation.” 

Under the Ledbetter Act, an unlawful employment practice occurs “when a discriminatory compensation decision or other practice is adopted, when a person becomes subject to a discriminatory compensation decision or other practice, or when a person is affected by application of a discriminatory compensation decision or other practice, including each time wages, benefits, or other compensation is paid, resulting in whole or in part from such a decision or other practice.” 29 U.S.C. § 626(d)(3) (2009). This legislation followed the Supreme Court’s decision in Ledbetter v. Goodyear, which limited Ledbetter’s claim to adverse actions taken within 300 days of filing the EEOC Charge.  

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The Ohio Supreme Court held yesterday that a discharged employee is barred from pursuing an action for age discrimination under R.C. § 4112.99 when the discharge has been arbitrated and was found to be for just cause. More specifically, the Court concluded that R.C. § 4112.14(C), which prohibits age discrimination lawsuits if an arbitrator upheld a discharge for just cause, applies to age discrimination claims brought under § 4112.99. So if a Plaintiff files a lawsuit under § 4112.99, even though this provision does not mention arbitration proceedings, the state age discrimination claim may still be prohibited by § 4112.14(C). Meyer v. UPS, Inc., 2009-Ohio-2463. 

In Meyer, the plaintiff, Robert Meyer, was fired from his employment with UPS. The grievance filed by Mr. Meyer over his discharge was denied, and his discharge was upheld by a panel of union members and company management. Mr. Meyer filed a complaint in state court alleging workers compensation retaliation and amended the complaint to add state claims for age discrimination. Under Ohio law, a plaintiff may choose between several age discrimination statutes, including § 4112.02(N), § 4112.14, or § 4112.99. These statutes provide different damages to a plaintiff and arguably are covered by different statutes of limitations. Section 4112.14 is the only one that refers to arbitration. In this case, Mr. Meyer chose to file his claim under § 4112.99.
 

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Ever wonder if you can require an employee to split the costs of mandatory arbitration? The Sixth Circuit reinforced its 2003 en banc decision that allows for cost-splitting provisions in arbitration awards in the decision it issued Tuesday in the case of Mazera v. Varsity Ford Services, LLC et al. Of course, the court’s decision is not simply an affirmation that cost-splitting provisions are okay—rather, it is an affirmation that the validity of these provisions must be assessed on a case-by-case basis.

In this case, Omari Mazera was fired from his job as a car porter at Varsity Ford Services, LLC (“Varsity”). Mazera filed a lawsuit alleging that Varsity had discriminated against him on the basis of his race and disability; he also moved the district court to declare that the arbitration provision in Varsity’s employee handbook was unenforceable. 

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On May 12, Representatives Stewart and McGregor introduced into the Ohio House of Representatives H.B. 176 to add “sexual orientation or gender identity and expression” to the list of protected classes under Chapter 4112, Ohio’s anti-discrimination statute, and R.C. 4111.17, which prohibits wage discrimination. Interestingly, the bill limits the statutes’ coverage for the two new classes only —sexual orientation and gender identity and expression—to government employers and employers employing 15 or more persons (as opposed to the four or more persons required for other protected classes). [R.C. 4112.01(2).] 

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We have been receiving more and more questions from human resources professionals asking how the ADA might impact their preparation for a potential pandemic flu. Now the EEOC has issued technical guidance on the topic, focused primarily on employers’ rights to make medical inquiries and require medical examinations of applicants and employees.  With respect to applicants, the EEOC notes that the ADA operates normally to preclude all disability-related questions and medical exams until after a conditional offer has been made.  With respect to current employees, who can be required to respond to medical inquiries or undergo medical exams only if they are job-related and consistent with business necessity, however, the EEOC recommended a model survey of employees that could be issued to all employees in preparation for a pandemic. The model survey is reprinted below:

ADA-Compliant Pre-Pandemic Employee Survey:

Directions:   Answer “yes” to the whole question without specifying the reason or reasons that apply to you.  Simply check “yes” or “no” at the bottom.

In the event of a pandemic, would you be unable to come to work because of any of the following reasons:
 

    If schools or day-care centers were closed, you would need to care for a child; 

    If other services were unavailable, you would need to care for other dependents;

    If public transport were sporadic or unavailable, you would be unable to travel to work,  and/or:

      If you or a member of your household fall into one of the categories identified by CDC as being at high risk for serious complications from the pandemic influenza virus, you would be advised by public health authorities not to come to work (e.g., pregnant women; persons with compromised immune systems due to cancer, HIV, history of organ transplant or other medical conditions; persons less than 65 years of age with underlying chronic conditions; or persons over 65).

Answer:   YES __________   NO __________
 

The EEOC’s guidance also clarifies its position that employers may enforce rules requiring employees to behave in a hygienically appropriate manner to avoid the spread of the flu, to wear personal protective gear such as face masks, and to require employees to work from home.
 

In a separate release cryptically titled “Employment Discrimination and the 2009 H1N1 Flu Virus (Swine Flu),” the EEOC reminds us that Title VII “prohibits employment discrimination on the basis of national origin, for example, discrimination against Mexicans.” The “guidance” states nothing else as it relates to Title VII. Presumably, the EEOC wants to remind employers not to direct any employment actions at workers of Mexican descent out of a fear or concern that they may be more likely to carry the H1N1 flu virus.

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Yesterday, the U.S. Supreme Court heard oral arguments in Ricci v. DeStefano, a case in which several white and Hispanic New Haven firefighters claim that they were discriminated against when the city refused to certify promotion test results based on a concern that the test may have been flawed.  Attorneys for the firefighters contend that the city improperly refused to certify the test results because the test did not generate a sufficient number of African-American candidates for promotion. Attorneys for the city contend that the city properly took a second look at the validity of the test when it appeared to have had an impermissible disparate impact on African-Americans in violation of Title VII and then refused to certify the test results when it discovered flaws in the validity of the test and the testing process.

During yesterday’s argument, Justice Souter expressed concern that, unless the city has the flexibility to reconsider its test results, it may be placed in "a damned if you do, damned if you don't” situation. Any decisions the city based on the test results would be a likely target for litigation under either a claim of disparate treatment (the firefighters’ claim in this case) or a claim of disparate impact (the likely claim of African-American promotion candidates had the test results been certified). This dilemma results, as Justice Scalia noted, in putting the disparate treatment and disparate impact models of discrimination "at war with one another."

When this decision is announced, it undoubtedly will raise a firestorm of controversy.  We will be there to let you know what it all means.

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Ohio State Senator Ray Miller (D), 15th District, has introduced Senate Bill 91, which would prohibit discrimination by an employer against any person because of that person's credit history. In short, the bill would amend Ohio's discrimination laws to include the use of "a person's credit rating or score or consumer credit history as a factor in making decisions regarding that person's employment, including hiring, tenure, terms, conditions, or privileges of employment, or any matter directly or indirectly related to employment."

Though the bill may be well intended, it creates in its current form bad policy for the State of Ohio. There certainly are many jobs out there where an individual's creditworthiness should have no impact on their ability to successfully perform the functions of their job. On the other hand, certain jobs, such as those that require handling or accounting for the employer's or the public's money, do appear to require at least some consideration of the individual's ability to manage money. The individual's own personal credit history may be an appropriate indicator of the person's ability to do those kinds of jobs. The EEOC, which enforces Title VII and other federal discrimination laws, as well as the federal courts, have recognized that employer credit checks can have an unlawful disparate impact against racial and ethnic minorities, but they permit employers to defend the practice by establishing that the individual's creditworthiness is job related for the position in question and consistent with business necessity. S.B. 91, however, contains no similar exception based on job-relatedness and instead absolutely prohibits employment decisions based on an individual's credit information. As a result, S.B. 91, in its current form, is another unnecessary and unrestrained limitation on Ohio businesses' ability to manage their workforce and to compete in our currently dismal economy.

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On April 1, 2009, in a 5-4 decision, the United States Supreme Court clarified an issue of confusion among lower courts when it held that “a collective-bargaining agreement that clearly and unmistakably requires a union member to arbitrate ADEA claims is enforceable as a matter of federal law.” 

The case, 14 Penn Plaza, LLC v. Pyett, No. 07-581, 556 U.S. ___ (2009), is a marked departure from established precedent in some jurisdictions and welcome news for employers who often prefer to present their cases to an arbitrator, rather than a jury. 

Until 14 Penn Plaza, the Supreme Court’s direction regarding the enforceability of a provision in a collective bargaining agreement that required a union member to arbitrate a statutory discrimination claim was not clear. In an earlier decision discussing whether an employee could be compelled to arbitrate a statutory discrimination claim, Alexander v. Gardner-Denver, 415 U.S. 36 (1974), the Court found that the provision at issue did not expressly require arbitration of a member’s statutory rights, so the employee could not be precluded from bringing statutory claims in a judicial forum.

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 The Ohio Fifth District Court of Appeals last week released an opinion in Nursing Care Mgmt. of Am., Inc. v. Ohio Civ. Rights Comm’n, that upheld the Ohio Civil Rights Commission’s determination that an employer unlawfully terminated an employee on the basis of pregnancy when the employer terminated the employee because she required pregnancy-related disability leave but had not met the minimum length of service requirements for maternity leave under the employer’s leave policy. In the decision, the Fifth District sets forth a rule requiring employers to provide maternity leave for a “reasonable period of time” and then reinstate the employees to their former positions—or positions of like status and pay—regardless of the employers’ policies on disability or maternity leave or whether the employees qualify for leave under the federal Family and Medical Leave Act (FMLA). 

Facts:

In Nursing Care, employee Tiffany McFee, who was already pregnant at the time of her hire, requested leave for a pregnancy-related medical disability after being employed only eight months. Under the policy of her employer, Pataskala Oaks, employees were eligible for 12 weeks of leave after one year of service. Employees with less than one year of service were not eligible for leave. Keep in mind as well that the FMLA only guarantees an employee 12 weeks of unpaid family or medical leave after an employee has 12 months of service—provided the FMLA applies to the employer and the other FMLA requirements are met. As a result, Pataskala Oaks terminated Ms. McFee’s employment because she did not qualify for leave. The termination came approximately one week after her request for leave and three days after she gave birth. 

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A termination within three months of an employee’s EEOC charge, combined with a claim that the employer increased its scrutiny of that employee after his charge was filed was enough to prevent summary judgment--even where the employer had refrained from terminating the employee at its first opportunity following his charge. Hamilton v. GE.

Jarrett Hamilton sued GE alleging that he was terminated in retaliation for filing an age-discrimination charge with the EEOC approximately three months earlier. He claimed that after he filed the charge, the company intensified its scrutiny of his work.  Of course, he filed the charge while on a 30-day suspension that had been agreed to after he had been terminated while under a Last Chance Agreement (LCA). The Company did not fire him when the first opportunity to do so arose after he filed the charge but later terminated him for what it said was unacceptable conduct, including refusing work directions from a supervisor and using “unacceptable foul and abusive language.”

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In a press release issued yesterday, the Equal Employment Opportunity Commission (EEOC) reports that, in its fiscal year 2008 (October 1, 2007 – September 30, 2008), there was a 15 percent increase in the number of employment discrimination charges filed against employers. The 95,402 charges filed are more than the number of charges filed in any other one-year period in the history of the agency. The greatest percentage increase was in age discrimination charges, up 28.7 percent from the previous year. Sex discrimination charges were up 14 percent, and race charges were up 11.2 percent. There was a smaller percentage increase in disability charges (9.7 percent), but with the recently-passed amendments to the Americans with Disabilities Act, employers will likely see a significant increase in disability charges in fiscal year 2009. 

The steep increase in discrimination charges was no doubt fueled, in part, by job losses in the beginning stages of the economic recession. The continued down-turn of the economy in the last quarter of 2008 and early months of 2009 makes it almost certain that the number of discrimination charges will continue to increase.

So what does all of this mean for you as an employer? To begin, it is far more likely that employers will be sued or will face discrimination charges as employees are laid off or face other adverse employment actions. An economic reduction-in-force will, very possibly, generate charges or lawsuits. All too often, employers do not exercise the care needed with the decision-making leading up to a reduction-in-force. Careful attention to the process and documentation in the early stages, however, can make legal challenges less likely to occur and can make those that are filed more easy to defend. 

As we’ve discussed before, employers should develop and document a sequential approach from the very earliest stages of the decision-making leading up to a reduction-in-force. Key steps in that approach include:

• Reorganizing or eliminating job duties; 
• Selecting the employees best-qualified to perform remaining job duties;
• Establishing criteria for termination or lay-off decisions that are based on legitimate business reasons;
• Documenting the selection criteria, procedure, and decisions;
• Conducting a statistical review to identify any disproportionate impact on protected class employees and, if a disproportionate impact is shown, carefully reviewing decisions to assure that they are supported by legitimate business considerations.

After these steps have been taken, the company should consider payment of severance to and securing signed release agreements from those who are terminated. It is a mistake, though, to presume that all terminated employees offered severance will sign release agreements and therefore give short shrift to the initial decision-making and documentation steps. All it takes is one terminated employee who refuses to sign a release and, instead, files a charge or a lawsuit to negate the savings of the reduction-in-force through the cost of defense, settlement, or an adverse judgment.

Even if your company is not currently in a reduction-in-force mode, careful attention to all employment decisions is essential to reduce the risk of discrimination charges. Things like frank and candid communication in performance reviews and active involvement by human resource personnel in all adverse employment actions can make it far easier to defend later decisions to terminate in a reduction-in-force. 

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On March 2, 2009, the Equal Employment Opportunity Commission (EEOC) issued proposed rules to implement Title II of the Genetic Information Nondiscrimination Act (GINA).

GINA, which was signed into law on May 21, 2008, prohibits health insurers and employers from discriminating on the basis of genetic information. The EEOC is responsible for developing implementing regulations by May 21, 2009 for Title II, which applies to private and government employers. (See former blog post on May 21, 2008 entitled “Dream of GINA Now a Reality”). Generally, Title II prohibits employers from discharging, refusing to hire, or otherwise taking adverse employment action against applicants or employees based on their genetic information. It also prohibits employers from intentionally acquiring genetic information about applicants and employees. Title II of the Act will become effective on November 21, 2009. 

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On January 29, the Lilly Ledbetter Fair Pay Restoration Act was the first bill signed into law by President Obama. As discussed in prior blog entries, the new law gives a employee or former employee the right to file a charge of discrimination within 180 days (or 300 days in some states, including Ohio) of their most recent paycheck. The Act overturns a U.S. Supreme Court decision holding that the statute of limitations started to run as soon as an employee received his or her first unfair paycheck. Under the new law, each new paycheck alleged to be discriminatory extends the statute of limitations for an additional 180 (or 300) days. 

The new law will significantly impair the ability of companies to defend claims about old pay decisions in federal court, especially for those employers who have forgotten or have not retained documentation as to why a given pay decision was made in the first place.

To read our client alert on this new law, click here.

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Earlier this week, the U.S. Supreme Court released an opinion in Crawford v. Metropolitan Government of Nashville and Davidson County, Tennessee. In this case, the employer, a school district in Tennessee, conducted an internal investigation into allegations of sexual harassment against its employee relations director, Mr. Hughes. Employee interviews were conducted in connection with the investigation. When the plaintiff, Ms. Crawford, was interviewed, she informed the school district that Mr. Hughes had sexually harassed her. Following the investigation, the school district took no action against Mr. Hughes but fired Ms. Crawford, alleging embezzlement.

Ms. Crawford filed suit against the school district, claiming that she was retaliated against in violation of Title VII of the Civil Rights Act of 1964. Title VII, which prohibits sexual discrimination and harassment, also makes it unlawful for “an employer to discriminate against any employee who . . . has opposed any practice made an unlawful employment practice by this subchapter.” The school district’s motion for summary judgment was granted by the district court and upheld by the Sixth Circuit Court of Appeals on the grounds that Ms. Crawford did not “oppose” the sexual harassment because she did not proactively complain about it or file a charge with the EEOC, but merely responded to questions asked during an internal company investigation.

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On Monday, December 15, 2008, the City of Columbus modified its ordinances related to discrimination (Chapter 2331 of the Columbus City Codes). The modifications add five new protected classes to the employment discrimination ordinance: age, disability, gender identity or expression, familial status, and military status. 

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Numerous news reports suggest that President-Elect Obama will name California Congresswoman Hilda Solis (D. Cal.), who was a co-sponsor of the Employee Free Choice Act, as his administration’s Secretary of Labor. Both the SEIU and the AFL-CIO have issued press releases enthusiastically responding to this news. Those of you who are curious or wary about this selection may wish to visit her website at http://solis.house.gov

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The Sixth Circuit weighed in on an issue that has split the federal courts and has joined the Seventh and Ninth Circuits in holding that disabled former employees lack standing to sue under Title I of the Americans with Disabilities Act. McKnight v. Gen. Motors Corp., No. 07-1479 (6th Cir., Dec. 4, 2008). The Court found that three General Motors Corp. retirees lacked standing under the ADA to challenge the reduction of their pension benefits when they started receiving Social Security disability benefits. 

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National banks may be missing out on a defense available to them against certain state-law employment claims brought by terminated bank officers. In particular, the National Bank Act (NBA) allows national banks to dismiss officers “at pleasure, and appoint others to fill their places.” This provision has been interpreted to mean that state-law tort and contract wrongful discharge claims by terminated bank officers are preempted and, thus, subject to dismissal. See, e.g., Boesch v. Champaign National Bank, Case No. 24014 at 6 (9th App. Summit Cty., June 30, 2008); Schweikert v. Bank of America, Case No. 06-2137 (4th Cir. April 1, 2008).

The NBA preemption defense applies, however, only when a bank’s board of directors makes the termination decision or delegates the authority to do so and then ratifies the decision. The board’s ratification need not occur before or on the termination date, but it needs to occur as promptly afterward as possible.

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President Bush signed the ADA Amendments Act (S. 3406) into law Thursday, September 25. The new provisions, intended to clarify and strengthen protections Congress intended to guarantee in the original ADA, go into effect on January 1, 2009. For more information on the provisions of the new law and what the law means for employers, please read our previous postings where these issues are discussed in more detail.

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The decision in a recent federal court case against the United States Library of Congress shows clearly the risk an employer takes when making employment decisions based on a person’s gender identity. In Schroer v. Billington, D.D.C., Case No. 05-1090, September 19, 2008, the Library of Congress was found guilty of sex discrimination under Title VII when it withdrew a job offer just after the Library became aware that the person being hired – Diane Schroer – was undergoing medical treatments to change her sex from male to female. Ms. Schroer is a decorated military veteran and had been hired for a terrorism research analyst position at the Library. Shortly after being hired, she disclosed the fact that she was undergoing sex change treatments, and the Library of Congress told her the next day that she would not be a “good fit” for the job.

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On Wednesday, September 17, by voice vote, the House of Representatives approved the Senate version of the ADA Amendments Act (ADAAA) (S.3406), which the Senate had unanimously approved last week. The White House immediately issued a statement that President Bush looks forward to signing the bill into law. Once signed, the ADAAA will take effect on January 1, 2009.

The Senate bill differed slightly from the previously passed House version. For employers, the most significant difference between the two bills is the decision to eliminate a definition for “substantially limits,” which was included in the House bill. Instead, the new bill directs the EEOC to abandon its current regulation – a regulation that the bill specifically finds too restrictive – and to create a new rule that provides broader coverage.  

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As previously reported, many federal contractors will be required to file their first annual VETS-100A report by September 30, 2009 based on a final rule issued earlier this year.  In order to complete the new report, federal contractors covered by the new rule must start collecting the required data no later than August 31, 2008. 

The VETS-100A, like the VETS-100, requires a federal contractor to have 12-months of data collected.  The 12-month period must end on a date between July 1 and August 31, 2009.  Likewise, this means that the contractor must begin collecting the data between July 1 and August 31, 2008.  If you are a federal contractor, and if you will be required to fill out the new VETS-100A form, you should either already be collecting data or must start collecting it before August 31. 

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The U.S. House of Representatives overwhelmingly passed the ADA Amendments Act, H.R. 3195, by a vote of 402-17. The bill would amend the Americans with Disabilities Act (ADA) and reject several U.S. Supreme Court decisions that have narrowed the scope of the ADA’s protection. If enacted, the bill would be effective January 1, 2009.

The intent of the bill is to restore the broad scope of protection available under the ADA.  The legislation includes the following key provisions:

• The definition of disability is to be construed broadly.
• Clarifies the definition of “disability” by:
  • Defining “substantially limits” to mean materially restricts (rather than the current standard of prevents or severely restricts);
  • Defining “major life activity” broadly and including within that definition “major bodily functions”;
  • Clarifying that an impairment substantially limits one major life activity does not have to limit any other major life activities;
  • Clarifying that impairments that are episodic or in remission are disabilities if they would substantially limit a major life activity when active;
  • Prohibiting consideration of the ameliorative effects of mitigating measures in determining whether an individual has a disability; 
  • Stating that an individual does not have to establish that the impairment limits or is perceived to limit a major life activity under “regarded as” disabled provisions. 
• Provides that employers are not required to provide reasonable accommodations to employees who are “regarded as” disabled.

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In Kentucky Retirement Systems v. EEOC, No. 06-1037, 2008 WL 2445078 (U.S. June 19, 2008), the Supreme Court recently held that “where an employer adopts a pension plan that includes age as a factor” (in determining eligibility for retirement with pension benefits), and the employer subsequently “treats employees differently based on pension status,” the plan does not automatically violate the Age Discrimination in Employment Act (ADEA). Rather, the Court held that the plaintiff challenging such a policy must show that the differential treatment was “actually motivated” by age. In a 5-4 decision — with a rather strange alignment of the justices — the majority, which consisted of Justices Breyer (who authored the opinion), Stevens, Souter, and Thomas and Chief Justice Roberts, reversed the Sixth Circuit’s en banc ruling striking down the pension plan as facially discriminatory.

[This post serves as a follow up to my earlier posts on March 26, 2008 and January 2, 2008 regarding the decision in Erie County Retirees Association v. County of Erie by the Third Circuit upholding the EEOC’s rule allowing employers to coordinate retiree healthcare benefits with Medicare benefits, effectively resulting in equal total benefits between younger retirees and older Medicare-eligible retirees but unequal amounts spent on the two groups’ benefits because a portion of the Medicare-eligible retirees’ payments come from Medicare.]

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Employers with federal contracts worth $100,000 or more entered into on or after December 1, 2003 will now be required to file a new form, VETS-100A, with the Veterans’ Employment and Training Service (VETS). Covered federal contractors must begin collecting the new information this summer and file their first annual reports on the VETS-100A form by September 30, 2009. 

Employers working on federal contracts of $25,000 or more that predate December 1, 2003 must continue to file the VETS-100 form. Some employers with contracts falling into both categories will be required to file both forms, although VETS predicts that most contractors will file either the VETS-100 form or the VETS-100A form but not both. Modifications of pre-December 2003 federal contracts made on or after December 1, 2003 create new contracts. Contractors subject to such modified contracts need only track and report under the new VETS-100A form for the modified contract – and only if the contract meets the $100,000 threshold.

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In CBOCS West, Inc. v. Humphries, the Supreme Court held 7-2 that under 42 U.S.C. §1981, retaliation itself is a form of prohibited discrimination when contractual rights are at stake, even though §1981 does not include the word “retaliation.” Although this particular issue had been addressed by several appellate courts, the Supreme Court had never addressed the question squarely.

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After more than a decade of effort, supporters of the Genetic Information Nondiscrimination Act (GINA) were finally granted their wish. Passed overwhelmingly by the Senate (95-0) and House (414-1), GINA was signed into law today, May 21, 2008, by President Bush. Title I prohibits genetic discrimination in the area of health insurance while Title II ensures nondiscrimination in the employment arena.

Employers have plenty of time to bring their plans and workplaces into compliance. The Act’s group health plan provisions are effective for plan years beginning one year after enactment. The employment provisions become effective 18 months after enactment – November 21, 2009.

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It may seem odd to include a statement in an employment application or offer that limits the time that an employee has to file legal claims that may arise later in the employment relationship. Recent case law, however, suggests that it is something that all employers should consider and decide if it is appropriate for their business and their employees.

In the last three years, a line of case law has developed in Ohio and the Sixth Circuit that allows employers to limit the time period by which employees must bring claims arising from their employment. The cases all involved employers that included in their employment applications a provision stating that, by signing the application and subsequently accepting employment, the employee agreed to bring all claims arising out of the employment relationship within a certain period of time—a time period that is shorter than statutory limits. Some of the applications stated that any claims had to be filed within a period of time as short as six months.

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This is an update to my prior post on January 2, 2008 regarding retiree healthcare benefits.

A legal battle dating back to 2000 regarding retiree benefits came to a close recently.  In 2000, the Third Circuit ruled that treating Medicare-eligible retirees differently than younger retirees violated the Age Discrimination in Employment Act (ADEA).  This prompted the EEOC to issue an exemption to the ADEA allowing employers to reduce or eliminate retiree healthcare benefits for Medicare-eligible retirees, while providing higher levels of benefits for those retirees who are not Medicare-eligible.  The American Association of Retired Persons (AARP) challenged the EEOC's authority to issue this rule.  The district court and Third Circuit rejected AARP's challenge. 

Recently, the U.S. Supreme Court, as anticipated, declined to hear AARP's appeal on this issue.  This means that, absent Congressional action amending the ADEA, employers can now provide retiree healthcare benefits and coordinate those benefits with Medicare without fear of violating the ADEA.

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On March 5, 2008, the EEOC announced that employment discrimination charges increased by nine percent in 2007. This represents the largest one-year increase since 1993. Race discrimination continued to be the most commonly filed charge, followed by retaliation charges, which, for the first time, surpassed sex/gender discrimination charges. Employers also faced a record 5,587 pregnancy discrimination charges – 14 percent more than the prior record, which was set in 2006. In fact, most of the major charge categories saw double-digit percentage increases in 2007. As a result of these large increases, the EEOC recovered $345 million in monetary relief for charging parties, a 26 percent increase over the amount recovered in 2006.

These statistics can be explained just as easily by a heightened awareness of the law among employees, an increasingly diverse workforce, and increased job cuts as a result of a slow economy as by an actual rise in workplace discrimination and/or retaliation. Nevertheless, EEOC Chair Naomi Earp suggested that the statistics show that “[c]orporate America needs to do a better job of proactively preventing discrimination and addressing complaints promptly and effectively.”

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The Age Discrimination in Employment Act (“ADEA”) expressly states that a civil action cannot be filed until 60 days after a charge alleging unlawful discrimination has been filed with the EEOC. A primary rationale behind the charge-filing requirement is to allow the EEOC an opportunity to resolve the dispute by informal methods. To that end, the EEOC has developed a specific form, labeled “Charge of Discrimination.” In a decision issued yesterday, though, the U.S. Supreme Court held that a plaintiff should have been allowed to pursue her ADEA claim even though she did not file a formal charge with the EEOC until after she filed her court complaint. In Federal Express v. Holowecki, the Court ruled that plaintiff’s “Intake Questionnaire, and attached six-page affidavit was sufficient to satisfy the ADEA’s charge-filing requirement. The Court reached this conclusion even though the EEOC neither assigned a charge number nor informed Federal Express that a charge had been filed.

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Ellen Mendelsohn sued Sprint under the Age Discrimination and Employment Act of 1967 (ADEA). In support of her claim, she sought to introduce testimony by five former Sprint employees who also claimed age discrimination even though none worked in Mendelsohn’s group or under the supervisors in her chain of command. Moreover, none of those witnesses heard any discriminatory remarks from Mendelsohn’s supervisors. Before the trial, Sprint moved to exclude the testimony, arguing that it was irrelevant to the central issues in the case because the employees were not similarly situated to Mendelsohn and the testimony would cause unfair prejudice. The District Court excluded the evidence and ruled that Mendelsohn could offer only evidence of discrimination against employees who were similarly situated to her, meaning that those employees had the same decision maker/supervisor and that there was temporal proximity.

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On December 20, 2007, Governor Strickland signed into law the “Ohio Veterans Package” (Sub. H.B. 372), which is intended to support members and veterans of the armed services. Among other things, the Act exempts the estates of service men and women who die in active service from certain probate fees, exempts retired military personnel pay for military service from the Ohio income tax, and designates Interstate Routes 70 and 71 in Ohio as the “Purple Heart Trail.”

Perhaps the most significant change made by the statute - particularly for Ohio employers - is the addition of “military status” to the list of protected classes under R.C. 4112.02. This change means that employers are prohibited from discriminating against employees based on their military status in the same way that they are prohibited from discriminating on the basis of race, color, religion, sex, age, national origin, ancestry, or disability. The Act defines “military status” as “service in the uniformed services,” including voluntary or involuntary service in the U.S. armed forces, full-time National Guard duty, and duty or training for the Ohio Organized Militia. Questions sure to arise under this new legislation are whether it applies only to current military status, as opposed to veteran status, and whether, in light of the statute’s ban on publishing advertisements for employment that indicate a preference as to military status, it will bar employer preferences in favor of individuals based on their military status.

According to the Ohio Legislative Service Commission’s status report, the Act goes into effect on March 24, 2008. In anticipation of this effective date, Ohio employers are advised to add “military status” to the list of protected classifications in their EEO statements and nondiscrimination/anti-harassment policies.

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In July 2007, the Fourth Circuit Court of Appeals held in Progress Energy v. Taylor, 493 F.3d 454 (4th Cir. 2007), that, under the Department of Labor’s (DOL’s) regulations and the Family and Medical Leave Act (FMLA), employees cannot waive their rights under the FMLA in a private agreement, such as a severance agreement.  To waive FMLA rights, the Fourth Circuit held that the agreement must first be court- or DOL-approved.  Progress Energy, supported by several other business groups, appealed the decision to the U.S. Supreme Court, citing a split between the Fourth and Fifth Circuits.  On January 14, 2008, the Supreme Court asked the DOL to submit its view on the issue.  This type of request is often a signal that the Supreme Court will review the decision. 

The background of the case is relatively simple.  Taylor, the employee, was terminated by Progress Energy as part of a reduction in force in which past performance evaluations were used to determine which employees to terminate.  Taylor received poor performance evaluations after several health-related absences that Progress Energy determined were not FMLA protected.  Although Taylor tried to have the evaluations changed, she was unsuccessful.  Upon her termination, Taylor and Progress Energy entered into a severance agreement where Taylor received $12,000 in exchange for waiving all rights to litigate.  The agreement did not specifically mention Taylor’s rights under FMLA, but it referenced rights under “other federal laws.”

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On December 26, the EEOC announced a new rule that makes it easier for employers to help retirees maintain adequate healthcare benefits.  In particular, employers that provide retiree healthcare benefits may coordinate those benefits with Medicare benefits without engaging in age discrimination based on the difference in ages between younger non-Medicare-eligible retirees and older Medicare-eligible retirees.

In today’s employment landscape, fewer employers provide retiree benefits.  This forces many retired employees to rely solely on Medicare benefits to cover increasing healthcare costs—at best, a difficult situation.  As a result, many employers are searching for viable ways to continue to provide healthcare benefits to retirees.  The most common and cost-effective way for companies to do so is for employers to coordinate employer-provided benefits with benefits provided by Medicare.  This is accomplished by:

1. supplementing the benefits provided by Medicare up to a specified level of coverage;
2. offering benefits after retirement but only until the retiree becomes Medicare-eligible; or
3. some combination of the two.

Although these approaches seem reasonable, courts questioned their legality under the Age Discrimination in Employment Act.  In Erie County Retirees Association v. County of Erie, a controversial decision issued in 2000 by the U.S. Court of Appeals for the Third Circuit, the practice of treating Medicare-eligible retirees differently than younger retirees was found to violate the ADEA.  In that case, the court held that the health insurance benefits provided to Medicare-eligible retirees and younger retirees must cost the employer the same amount.  Not surprisingly, most retiree healthcare plans violated the ADEA because employers typically spend significantly less on retiree benefits when those benefits only supplement Medicare’s coverage.  Faced with the prospect of spending more money for retiree benefits, many employers considered reducing or eliminating retiree healthcare benefits for both Medicare-eligible and younger retirees.

Perhaps recognizing the dilemma posed to employers that try to do right by their retirees, the Third Circuit recently provided an out: The court ruled that, notwithstanding the Erie decision and objections by the American Association of Retired Persons (AARP), the EEOC has the authority under the ADEA to enact regulatory exceptions to the ADEA's provisions.  Accordingly, the EEOC’s new rule provides an exemption from the ADEA for the longstanding employer practice of coordinating retiree benefits with Medicare coverage.  Employers and labor groups alike support the new rule.

AARP appealed  to the United States Supreme Court the Third Circuit's decision regarding whether the EEOC has authority to create the exception to the ADEA.  It seems unlikely that the Supreme Court will agree to hear this appeal.  If it does and decides in favor of AARP (this is unlikely), the rule's new exception to ADEA will not take effect.

The Supreme Court, however, has heard oral argument in a related case that will likely impact this area.  In Kentucky Retirement System v. EEOC, the Supreme Court considered "whether any use of age as a factor in a retirement plan is 'arbitrary' and thus renders the plan facially discriminatory in violation of the Age Discrimination in Employment Act."  The case involves disability retirement benefits and normal retirement benefits in which service years or a combination of age and service years determines eligibility for both, and thus, age is an indirect factor in determining eligibility.  The Supreme Court will decide if this plan violates the ADEA.  This may or may not impact the decision in Erie.

Bottom line for employers: The ADEA no longer poses an obstacle for employers that wish to treat retirees equitably by supplementing Medicare benefits for Medicare-eligible retirees and providing greater benefits for non-Medicare-eligible retirees.

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As further proof that no good deed goes unpunished, one Ohio appellate court has held that an employer’s affirmative action plan (AAP) may be used against it to prove discrimination. Strange as it may seem, the court’s decision highlights the risks associated with invalid AAPs and gives employers everywhere reason to reevaluate their efforts on this front.

In a reverse race and gender discrimination case, the Montgomery County Court of Appeals held that a public employer’s affirmative action plan could amount to direct evidence of employment discrimination at trial if the plan is found invalid under Title VII of the Civil Rights Act and the Equal Protection Clause of the Constitution. Mitchell v. Lemie 2007-Ohio-5757.

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The importance of leaving your personal life at home–particularly if it involves a penchant for pornography–is amply highlighted by the Second Circuit’s decision in Patane v. Clark, No. 06-3446 (2nd Cir. Nov. 28, 2007).  In Patane, the court upheld a female college secretary’s right to pursue a hostile work environment claim under Title VII and state discrimination laws based on her male supervisor’s pornographic video and website viewing habits.  Apparently oblivious to the development of sexual harassment law over the last 40 years or so, the supervisor–who happened to be the chair of the college’s Classics Department–allegedly viewed sexually-explicit videotapes for one to two hours every day on his office television, which was visible to his secretary through a glass partition.  He also left pornographic videos scattered across his office floor, viewed pornographic websites on his secretary’s work computer, and required her, as a part of her secretarial duties, to open his mail, which–you guessed it–included pornographic videotapes that the supervisor had delivered to his office.

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Last month, the Ohio Civil Rights Commission (OCRC) approved new maternity leave regulations requiring all Ohio employers having 4 or more employees to give each pregnant employee up to 12 weeks paid or unpaid maternity leave, regardless of whether the employee is in her first year of employment and regardless of whether she has previously exhausted any other leave that might have been available to her for non-maternity purposes. On Monday, December 3, 2007, the Joint Committee on Agency Rule Review (JCARR) voted 9-1 to reject the Commission’s proposal.

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Retaliation claims have long been some of the most difficult for employers to defend. What’s more, they become nearly impossible to avoid once employees engage in protected activity; almost any decision an employer makes after that point – short of pay increases and promotions – may prompt a disgruntled employee to challenge the decision as an act of retaliation. A recent Ohio Supreme Court case, however, provides some comfort to employers in this difficult area of the law.

On December 12, 2007, the Ohio Supreme Court held in Green-Burger v. Temesi, 2007-Ohio-6442, that it is not per se – or automatically – retaliatory for an employer to file a lawsuit against a current or former employee after the employee engages in protected activity. In its first consideration of the issue, the Court held that “the filing of a lawsuit by an employer against an employee or former employee who has engaged in a protected activity is not per se retaliatory.” Even more importantly, the Court ruled that, “if an employer can demonstrate that a lawsuit against an employee who has engaged in a protected activity is not objectively baseless, the suit shall be allowed to proceed,” and any attempts by the Ohio Civil Rights Commission (OCRC) to pursue a retaliation case against the employer will be stayed.

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