Employer Law Report

New test should increase employer ability to create unpaid internship positions

Many employers allow students to intern in their workplaces so that the students can gain exposure to real world work, learn about a particular industry or career, or earn credit hours towards their degree requirements. If these interns are unpaid, however, employers risk liability for failure to pay minimum wage and overtime under the Fair Labor Standards Act (FLSA). Employers that enter into these arrangements without careful consideration of the FLSA risk lawsuits from former interns and United States Department of Labor (DOL) investigations.

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Sixth Circuit upholds termination of human resources employee for employment application misrepresentations and performance deficiencies

Agreeing with the district court’s assessment that “résumé misrepresentations by a senior human resources professional represent an infraction so egregious as to defy correction by mere counseling or other lesser discipline,” the 6th Circuit on April 23, 2018, rejected an appeal from a summary judgment order on claims of pregnancy, race, and age discrimination and retaliation in Bailey v. Oakwood Healthcare, Inc..

Michelle Bailey, a 40 year old African-American woman, was fired from her position as a senior staffing professional at Oakwood Healthcare, Inc. (Oakwood) on the day she returned from a three-month maternity leave. During her maternity leave, her supervisor had identified deficiencies in her work performance that prompted the supervisor to go back and review her qualifications. When she checked, she found what Ms. Bailey acknowledged in deposition were “embellishments” on her employment application. In notifying Ms. Bailey of her termination, Oakwood relied on both the deficiencies and the misrepresentations. Ms. Bailey later sued, claiming that she was fired because of her pregnancy, her race and her age as well as in retaliation for concerns she had expressed about the rejection of employment applications of certain African-American candidates for employment at Oakwood prior to her maternity leave. The district court granted summary judgment in Oakwood’s favor on each of these counts. Continue Reading

Ohio court whittles away at employers’ defense of voluntary abandonment of employment in workers’ compensation cases

In Ohio, it has been a long-standing principle that an employee injured at work could lose eligibility for temporary total disability compensation in a workers’ compensation claim when the employee is terminated by the employer for violation of a written work rule. The written work rule must define clearly the prohibited conduct, identify the conduct as a dischargeable offense, and was known or should have been known by the employee.

However, a recent court decision by the Franklin County Court of Appeals in State ex rel. Demellweek v. Indus. Comm, is limiting this defense for employers. In its ruling, the court held that employers will not be entitled to use the voluntary abandonment doctrine as a defense when the employer terminates an employee for a minor infraction. Continue Reading

Recent Supreme Court decision holds that FLSA exemptions are to be construed fairly

Many thanks to Arslan Sheikh for his assistance in preparing this post.

In a decision issued on April 2, 2018 the Supreme Court of the United States held in Encino Motorcars, LLC v. Navarro that service advisors at an auto dealership are exempt from the Fair Labor Standards Act’s (FLSA) overtime pay requirement. Most importantly, the Court also rejected the 9th Circuit’s holding and Department of Labor policy that FLSA exemptions should be construed narrowly. Instead, courts should apply a fairness test to determine whether a particular job is covered under the exempt classifications of the act. As a result, employers should be aware of this recent decision and consider how it may apply to them. Continue Reading

Sixth Circuit holds that Title VII prohibits discrimination based on transgender and transitioning status notwithstanding the employer’s religious objections

Employers cannot discriminate against employees based on their transgender or transitioning status, despite (at least in some cases) the employer’s sincere religious objections. Those are the key takeaways of the 6th Circuit’s landmark decision in EEOC v. R.G. & G.R. Employers who are subject to Title VII, particularly those in the 6th Circuit (i.e., Kentucky, Michigan, Ohio and Tennessee), should review their policies to ensure that they comply with this decision.

In EEOC v. R.G., the Equal Employment Opportunity Commission (EEOC) filed suit under Title VII after a Michigan funeral director, Aimee Stephens, was fired because of her intent to transition from male to female. The owner of the funeral home, Thomas Rost, is a lifelong Christian who believes that employing a transgender funeral director will make him complicit “in supporting the idea that sex is a changeable social construct rather than an immutable God-given gift.” Rost also believes that employing a transgender funeral director will distract his clients and interfere with their healing process, will interfere with his calling to serve God by ministering to grieving people, and will pressure him to leave the funeral industry and end his ministry.

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Wage and Hour Division announces pilot limited “amnesty” program

The U.S. Department of Labor’s Wage and Hour Division (WHD) has announced a new nationwide pilot program, called the Payroll Audit Independent Determination (PAID) program, which is designed to facilitate resolution of potential overtime and minimum wage violations under the Fair Labor Standards Act (FLSA). According to the WHD’s website describing the program, the program’s primary objectives are to resolve wage and hour claims expeditiously and without litigation, to improve employers’ compliance with overtime and minimum wage obligations and to ensure that more employees promptly receive any owed back wages.

WHD states that it will implement this pilot program nationwide for approximately six months. At the end of the pilot period, WHD will evaluate the effectiveness of the pilot program, as well as potential modifications to the program to determine its next steps. Continue Reading

Second Circuit holds that Title VII prohibits sexual orientation discrimination

In a landmark decision, the 2nd Circuit Court of Appeals in Zarda v. Altitude Express, Inc., en banc, became the second federal appellate court to hold that Title VII of the Civil Rights Act of 1964 (42 U.S.C. § 2000e-2(a)), which makes it unlawful for employers to discriminate on the basis of sex, also prohibits discrimination on the basis of a person’s sexual orientation. It appears that the defendant does not intend to seek Supreme Court review. Therefore, employers subject to Title VII, particularly those in the Second Circuit (i.e., Connecticut, New York and Vermont), should know about this opinion and consider how and whether it may apply to them.

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ADA public accommodations law reform on its way?

Yesterday (Feb. 15, 2018), The U.S. House of Representatives passed a bill, the ADA Education and Reform Act (HB 620), that would impose new requirements on plaintiffs before they file a lawsuit. Places of public accommodations, including websites and apps, would have 6 months to bring their place of public accommodation into compliance before a claimant could file a lawsuit seeking injunctive relief and attorneys’ fees.

Any employer who is also a place of public accommodation knows that lawsuits under the Americans with Disabilities Act (ADA) Title III have long posed a problem for businesses. Businesses want to comply but are often unaware of minor issues of noncompliance at their facilities. This law, if it passes the Senate and is signed by President Trump, would allow businesses notice of the alleged issues of noncompliance and a grace period to fix the issues before they would face potential liability for attorneys’ fees and costs.

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USCIS Administrative Appeals Office issues important non-precedent decisions on wage level determinations for H-1B petitions

Beginning in the summer of 2017, employers began to see an increase in Requests for Evidence (RFE) from USCIS on H-1B petitions alleging that the occupation was not a specialty occupation because the employer assigned a level 1 wage. Two recent decisions from the Administrative Appeals Office (AAO) indicate that this may no longer be an concern.

Some background to this issue is helpful. The H-1B visa is available for foreign nationals who will be performing services in a specialty occupation. The specialty occupation is a field that requires a specific educational background as a minimum qualification to perform the duties of the position. The statute also imposes an obligation to pay the “prevailing wage” or the actual wage, whichever is higher, as a measure to protect U.S. workers against unfair competition from foreign workers willing (or coerced) to work for substandard wages. The employer may calculate the prevailing wage by using the data provided by the Bureau of Labor Statistics for occupations and locations nationwide. The Department of Labor has issued guidance on how to determine which of the four wage levels provided in the data should be selected, based upon the normal requirements for the occupation compared to the employer’s requirements for the specific position.

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NLRB discards Obama-era decisions

After Republicans regained control of the majority seats on the National Labor Relations Board (NLRB or the board) for the first time in nearly nine years, the majority has swiftly reset the board’s tone. Recently, the NLRB has been busy taking steps to undo some of the more labor and employee friendly standards and opinions that were implemented under the Obama Administration. The result is a return to what many employers would consider to be a common sense approach. Continue Reading

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