WIRTW #85

Last week, Bozeman, Mont., began requiring all job applicants to provide a list of all “current personal or business websites, web pages, or memberships on any Internet-based chat rooms, social clubs or forums, to include but not limited to:  Facebook, Google, Yahoo, YouTube.com, MySpace, etc,” including their user names, other login info, and even their passwords. The Delaware Employment Law Blog and the California Employment Law Report have the details. Just as quickly, World of Work reports, the city reversed course and got rid of this awful practice. for other news in the world of background checks and employee screening, I recommend the Employeescreen IQ Blog on a background check that should have been done, and the Connecticut Employment Law Blog, on the risks of doing one incorrectly.

In the last couple of weeks, I’ve written a lot about social networking (Do you know? Facebook and Twitter and blogs, oh my! What is social networking and why should you care? and Drafting a social networking policy: 7 considerations). Kris Dunn, The HR Capitalist, has his own take on the issue.
Steph Gregor, in the Columbus, Ohio, Other Paper, writes on workplace lactation rights (and quotes me).

Dan Schwartz at the Connecticut Employment Law Blog has a good, basic lesson on “cloud computing.”

Jay Shepherd at Gruntled Employees, on why you shouldn’t nickel-and-dime your employees.
LaborPains notes that even the unions cannot agree that the mandatory arbitration provisions of the EFCA are a good idea.

Mike Elk at Today’s Workplace comments that he stopped drinking Yuengling beer because it is no longer a union shop (politics would never come between me and my favorite beer).

At HR Observations, Michael Haberman observes that labor unions are bad.

The FMLA Blog points out that just because an employee happens to be on FMLA leave does not mean that he or she cannot be fired.
Walter Olson’s Overlawyered reports that per a settlement, UPS will now permit the hard-of-hearing to drive certain trucks.

Mitchell Rubenstein at the Adjunct Law Prof Blog, on whether keystroke monitoring of employees’ computers violates federal law.

Another week brings us news of more new pending federal workplace laws. The Warren & Hays Employment Blog discusses the Family Friendly Workplace Act, which would allow for comp time in lieu of overtime. The Washington Labor & Employment Wire reports on another attempt at the Employment Non-Discrimination Act, which would add protections for actual or perceived sexual orientation or gender identity to Title VII.

Hector Chichoni at the Florida Employment & Immigration Blog thoroughly dissects the issues that could arise when layoffs hit employees with H-1B visas.

Ann Bares at Compensation Force tackles the issue of the lingering effect of furloughs.

Darcy Dees at Compensation Cafe opines on leveraging flexible work schedules as rewards for good employees.

WIRTW is taking next Friday off to celebrate our nation’s freedom, and will return on July 10 with a supersized two-week edition.

Workplace smartphone etiquette – smartphones versus smart use

When I started my first legal job during law school, the biggest distraction was  minesweeper on my desktop PC. Today, distractions are bigger, sleeker, and much more available. And, they have unshackled themselves from the desktop. Stop and think about the last meeting you attended when someone wasn’t fiddling with a Blackberry, iPhone, or other PDA.

In Sunday’s New York Times, Alex Williams takes up the etiquette debate of PDAs and corporate meetings:

As Web-enabled smartphones have become standard on the belts and in the totes of executives, people in meetings are increasingly caving in to temptation to check e-mail, Facebook, Twitter, even (shhh!) ESPN.com.

But a spirited debate about etiquette has broken out. Traditionalists say the use of BlackBerrys and iPhones in meetings is as gauche as ordering out for pizza. Techno-evangelists insist that to ignore real-time text messages in a need-it-yesterday world is to invite peril….

The phone use has become routine in the corporate and political worlds — and grating to many. A third of more than 5,300 workers polled in May by Yahoo HotJobs, a career research and job listings Web site, said they frequently checked e-mail in meetings. Nearly 20 percent said they had been castigated for poor manners regarding wireless devices.

Despite resistance, the etiquette debate seems to be tilting in the favor of smartphone use, many executives said. Managing directors do it. Summer associates do it. It spans gender and generation, private and public sectors.

At Gruntled Employees this morning, Jay Shepherd asks, “Does your company need a smartphone policy?” Here’s my two cents. If we are going to provide employees the technology to stay connected 24/7, and expect them to be available 24/7 because of this technology, we should trust them to be responsible with it. Technology has conditioned customers and clients to expect immediate responses to questions and problems. So, if an employee is spending some time during a meeting responding to a client, this responsiveness should be lauded, not legislated via a policy. On the other hand, if an employee is reading about the Cavs’ acquisition of Shaq, maybe the problem is with the meeting itself and not the employee.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

When is a failure to accommodate an employee’s religion actionable?

If an employee approaches your HR department and asks for an accommodation for his or her religion, you might think that your company has an automatic obligation to provide the accommodation. Reed v. United Auto Workers (6th Cir. 6/23/09) [PDF], suggests otherwise.

In Reed, a union member claimed that the UAW discriminated against him because of his religion by failing to reasonably accommodate his religious objection to financially supporting the union.

Under Title VII employers (and labor unions) have a statutory obligation to reasonably accommodate the religious observances of its employees, short of incurring an undue hardship. To establish a failure to accommodate claim, an employee must show: (1) that s/he holds a sincere religious belief that conflicts with an employment requirement; (2) s/he has informed the employer about the conflict; and (3) s/he was discharged or disciplined for failing to comply with the conflicting employment requirement. If an employee makes this showing, the employer (or, in this case, labor union) can avoid liability by showing that it could not reasonably accommodate the employee without undue hardship.

Reed’s claim failed because he could not show that he was discharged or disciplined as a result of his religious belief: “Unless a plaintiff has suffered some independent harm caused by a conflict between his employment obligation and his religion, a defendant has no duty to make any kind of accommodation.”

The next time you are faced with an employee requesting a workplace accommodation for some religious belief, do not necessarily assume that the accommodation is owed. The employee’s religious belief may not be sincere, the accommodation might be unreasonable and pose an undue hardship, or, as was the case in Reed, the failure to provide the accommodation may not result in any discipline or discharge. 

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Do you know? Handling a chronically ill employee

In the June 19 New York Times, Lesley Alderman provided chronically ill employees some practical information on how to protect their jobs while coping with a chronic illness. Employers also have to protect themselves from liability in the same situation. Two laws govern employees with chronic illnesses: the Family and Medical Leave Act and the Americans with Disabilities Act. It is crucial for employers to understand how these two laws intersect and interact.

The FMLA allows for 12 weeks of unpaid leave for, among other circumstances, an employee’s own serious health condition. A serious health condition is defined as illness, injury, impairment, or physical or mental condition that requires inpatient care or continuing treatment by a health care provider. Only those who have been employed for at least a year, and who have worked a minimum of 1,250 hours in the preceding year, are covered by the FMLA.

Unlike the FMLA, the ADA covers employees on day-one of employment. The ADA also differs from the FMLA in the scope of injuries and illnesses it covers. The FMLA merely requires a serious health condition that prevents the employee from working on a temporary basis (typically at least three days). The ADA, however, requires that the employee must have a current, chronic medical condition that substantially limits one or more major life activities on an ongoing basis. The ADA does not have a leave requirement, although it does require employers to reasonably accommodate employees’ disabilities. Under the ADA, once an employer learns that an employee might need a reasonable accommodation to perform the essential functions of the job, the employer must engage the employee in an interactive process to determine what that reasonable accommodation might be. An extended leave of absence, beyond the FMLA’s 12 weeks, might be reasonable accommodation, depending on the illness or injury, the nature of the job, and the employer’s needs.

The biggest mistake an employer can make is to terminate an employee automatically upon the expiration the FMLA-leave entitlement, without giving any consideration to whether that employee is covered by the ADA and whether a temporarily extended leave or other temporary job restructuring will enable that employee to remain employed.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Have you thought about these four issues before you fired that employee?

BLR’s HR Daily Advisor recently published a helpful checklist of the 10 Questions You Must Ask Before Firing (part 1 and part 2). I have synthesized the list into four key considerations:

1. Have you followed your own documents? There are several documents that inform the employment relationship – handbooks and other policy manuals, and contracts, both with individual employees and union agreements. Any well-written handbook should have a disclaimer that it is not a contract, that it is not binding on the company, and that the employee should not rely on it as such. Companies should nevertheless be careful to ensure that if it deviates from a policy, it has a good reason to do so an a history of similar deviations in similar circumstances. Union agreements have their own unique set of issues. Does the contract allow for termination? If so, are there rules or processes that must be followed? Are you acting out of an anti-union animus?

2. Have you been consistent? Consistency is paramount in any employment decision, and will go a long way to dispelling inferences of discrimination. Consistency looks at how you treated similarly-situated employees in similar circumstances. Two special circumstances merit mention. Retaliation is the single biggest employment practices risk facing employers today. If an employee has recently engaged in protected activity, triple-check to make sure the rest of your house is in order before terminating. In Ohio, pregnant employees gain special rights on their first day of employment, and have to be given their job back the expiration of maternity leave.

3. Do you have a well-documented business reason for the termination? When an employer relies on undocumented accounts of misconduct to support a termination, it is fair for a court or jury to infer that those accounts were created post-termination and question their legitimacy. So, have all performance and other problems with the employee been documented? Has the employee signed off on the record, or has it been documented that the employee refused to sign?

4. Have you been fair? This is the most important reason. Lawyers spend months, and sometimes years, preparing their case for trial. A trial lasts days, sometimes weeks. During that trial, the jury will hear from countless witnesses and see myriad documents. Every piece has been carefully laid out by the attorneys to make the most persuasive presentation possible. Jury instructions will be carefully drafted to ensure that the jury is given the correct law to apply to the case in reaching its decision, And, that jury will listen to bits and pieces and retain even less. At the end of day, no matter what the jurors are told, I believe that in most cases, the decision will come down to one fundamental question – was the employee treated fairly? If that juror, or his or her wife, child, or parent, was treated as the plaintiff was treated, would that juror believe he or she had gotten a fair shake, or was mistreated? At the end of the day, how you answer this question will most likely signal how you decision will be judged.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

WIRTW #84

Last week I posted a clip from one of my favorite movies, Office Space. This week, Dan Schwartz at the Connecticut Employment Law Blog teaches that had Milton engaged in protected activity before Lumbergh moved his desk downstairs to storage B, he could have filed a retaliation claim instead of taking out his anger by burning down Initech. (If you don’t know what I’m talking about, run, don’t walk, and rent Office Space now).

Jay Shepherd, of Gruntled Employees, thinks its pretty lousy to let employees know about layoffs via voicemail.

Two opposing views on arbitration under the Employee Free Choice Act: the Chamber Post, on why it’s wrong to arbitrate first contracts, and Today’s Workplace, on why it’s wrong to favor arbitration of workplace claims but not arbitration of collective bargaining agreements.

The Email Fail Blog points out why you might want to think twice before you send that racist email from a work computer.

The Word on Employment Law with John Phillips discusses some common legal traps that await employers that furlough employees. Do you want more information on these traps for the unwary? Take a look at Do you know? Mandatory unpaid time off may affect salaried employees’ exemptions.

Eric Welter at the Laconic Law Blog has information on how the ADA treats alcoholism.

Richard Bales at the Workplace Prof Blog reports that the EEOC voted to issue regulations implementing the ADA Amendments Act.

Dennis Westlind at World of Work reports that President Obama will extend job benefits to the same-sex partners of federal employees.

Michael W. Casey, III, of the Florida Employment & Immigration Blog, provides his top 10 considerations for implementing a layoff.

Rod Satterwhite, at Suits in the Workplace, on voice recognition technology as a reasonable accommodation under the ADA.

The Labor & Employment Law Blog reports on a $1.6 million fee award awarded to two employees who successfully defended a trade secret theft case brought by their former employer.

Electronic Discovery Law digests a recent case in which an employee was punished for destroying a laptop after his termination.

Employment Law Bits, on female workplace bullying.

Finally, a couple of posts on corporate wellness programs: Where Great Workplaces Start shares some ideas on how to implement a wellness program. The Iowa Employment Law Blog reminds employers not to discriminate when administering such a program. 

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

No buts about it: Supreme Court rejects mixed motives for age discrimination cases

Employees have three traditional methods to prove intentional discrimination: (1) direct evidence (comments that evidence a discriminatory animus made by a decision-maker in close temporal proximity to the challenged employment decision); (2) indirect evidence (which uses the McDonnell Douglas burden-shifting formula); and (3) a mixed-motive (discrimination was a motivating or a substantial factor in the employer’s action, and the employer cannot show that it would have taken the same action regardless of that impermissible consideration).

This morning, in Gross v. FBL Financial Services, Inc. [PDF], the Supreme Court held that there is no such thing as a mixed-motive in age discrimination cases under the ADEA. To succeed on an disparate treatment claim under the ADEA, a plaintiff must now prove that age was the “but-for” (that is, the only) cause of the challenged adverse employment action:

We hold that a plaintiff bringing a disparate-treatment claim pursuant to the ADEA must prove, by a preponderance of the evidence, that age was the “but-for” cause of the challenged adverse employment action. The burden of persuasion does not shift to the employer to show that it would have taken the action regardless of age, even when a plaintiff has produced some evidence that age was one motivating factor in that decision.

Because age discrimination plaintiffs must now prove “but for” causation, it is more important than ever for employers to meticulously document employees’ performance problems and other disciplinary action. A well-documented personnel file will make it that much more difficult for a plaintiff to prove that age was the sole reason motivating the termination or other action.

Proposed law would grant working moms breastfeeding rights

Last year, I wrote that even though Ohio has one of the country’s most liberal breastfeeding laws, it likely does not protect a mom’s workplace lactation rights. Moreover, few courts have protected breastfeeding and expressing breast milk under current workplace sex discrimination laws.

A potential new federal law could change all that. Identical bills have been introduced in the House and Senate that would require employers to accommodate working moms’ breastfeeding needs at work. The Breastfeeding Promotion Act [PDF] would make three significant changes to existing laws:

• Amend Title VII to include lactation (breastfeeding or the expression of milk) in the definition of sex discrimination.

• Amend the Fair Labor Standards Act to require that employers provide “reasonable break time for an employee to express breast milk for her nursing child for one year after the child’s birth”, and make “reasonable efforts to provide a place, other than a bathroom, that is shielded from view and free from intrusion” for an employee to express breast milk.

• Amend the Internal Revenue Code to provide a tax credit for employers that provide an appropriate workplace environment for employed moms to breastfeed or express milk.

It’s difficult to say how much traction the BPA has, but this bill is definitely one that warrants watching.

[Hat tip: World of Work]

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Do you know? “Salting” the wounds of labor organizing

“Salting” is a common organizing tactic used by labor unions. It refers to union organizers applying for jobs with non-union employers. The organizers then attempt to organize the employer’s workforce from the inside. In addition to organizing, the salts also try to inflict economic harm on the targeted employer by triggering unfair labor practice charges and resulting back pay liability. Salting is one the more underhanded methods of organizing used by labor unions.

In Toering Electric Co. [PDF], the Bush-era NLRB attempting to limit the ability of unions to salt non-union workplaces. It ruled that an applicant for employment must be genuinely interested in seeking to establish an employment relationship with the employer in order to qualify as an "employee" under the meaning of the National Labor Relations Act, and thus be protected against hiring discrimination based on union affiliation or activity.

Although they face an uphill battle, Congressional Republican are attempting to put another nail in salting coffin. The Truth in Employment Act of 2009 would amend the National Labor Relations Act so that an employer would not be under any obligation to “employ any person who seeks or has sought employment with the employer in furtherance of other employment or agency status.” The Congressional findings contained in the bill make it clear that this intent of this measure is to end salting once and for all:

The tactic of using professional union organizers and agents to infiltrate a targeted employer’s workplace, a practice commonly referred to as ‘salting’, has evolved into an aggressive form of harassment not contemplated when the National Labor Relations Act was enacted and threatens the balance of rights which is fundamental to the system of collective bargaining of the United States. Increasingly, union organizers are seeking employment with nonunion employers not because of a desire to work for such employers but primarily to organize the employees of such employers or to inflict economic harm specifically designed to put nonunion competitors out of business, or to do both. While no employer may discriminate against employees based upon the views of employees concerning collective bargaining, an employer should have the right to expect job applicants to be primarily interested in utilizing the skills of the applicants to further the goals of the business of the employer.

Given the party affiliation of both houses of Congress and the White House, the Truth in Employment Act will likely go nowhere. It’s introduction, though, is a good reminder to non-union employers that salting remains a legitimate threat, especially in today’s pro-union environment.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Examining our prejudices

As my wife and I were loading our kids into the car for a trip to Lowe’s last Thursday night, we noticed someone we didn’t recognize talking to our neighbors across the street. As we were getting into our car, the man crossed the street and approached us. He was in his early twenties and casually, but neatly, dressed. He was carrying a packet of papers in his hand, and began rambling about running track, a trip to England, and selling magazine subscriptions. He handed me his packet of papers to look at, which ended up being a bunch of handwritten notes of magazine titles. When I told him that we already bought subscriptions from our nieces and nephews, he changed his story to something about soliciting used books for his mom. Needless to say, my spidey sense started tingling. I quickly finished gathering my family into the car, excused ourselves, and drove off. I also called the police. Apparently, I wasn’t the only person skeeved out by this guy, because the police already had a description and two squad cars on the way.

I’ve neglected one fact from this story. The particular person who made me nervous enough to call the police happened to be African American. Given his weird behavior, shifting purposes for going door-to-door, and lack of legitimate handouts, I’d like to think I would have reacted the same way no matter his race, especially in light of our neighborhood’s diversity. But, I am left wondering if his race added to my level of discomfort.

Most people do not set out to discriminate. In my career, I’ve come across very few employers that made a conscious decision to fire someone because of their race. Yet, no matter how enlightened and progressive we like to think that we are, we all harbor life experiences and prejudices that shape our behavior. Those prejudices don’t make us bigoted or racist; they just make us human.

Businesses get themselves in trouble when they believe they aren’t capable of discrimination. The key to avoiding potential liability is to recognize that we are all capable of discriminating. That recognition allows us to examine the prejudices that could lead to disparate treatment and hopefully avoid it. Something to think about the next time you hire or fire someone.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

WIRTW #83

Every now and then a story slips through the cracks. Such is the case with Lima v. State, decided this week by the Ohio Supreme Court, in which the Court ruled that cities cannot enforce residency requirements as a condition of employment. The Cleveland Law Library Weblog has more information.

If the following headline doesn’t make you throw-up your breakfast, nothing will: Former Employee Wins $4.1 Billion. That is not a typo. The award really was $4.1 Billion. World of Work has the gory details of what can go wrong when you terminate a really high earner.

Two states have enacted legislation permitting parents unpaid leave to attend their children’s school activities. Colorado (via the Colorado Employment Law Blog) and Nevada (via the Workplace Prof Blog).

Meanwhile, Compensation Cafe offers a good list of potential new federal employment laws on the horizon.

Dan Schwartz at the Connecticut Employment Law Blog reminds employers that discrimination cases often hinge on whether the employer is consistent in its explanations.

Molly DiBianca at the Delaware Employment Law Blog digests recent polling data on office romances.

Michael Moore at the Pennsylvania Labor & Employment Blog discusses the important issue of who is a “management-level employee” for purposes of imputing harassment liability to an employer.

Christopher McKinney at the HR Lawyer’s Blog reports on chronic fatigue syndrome as an ADA-protected disability.

George’s Employment Blawg offers up a plaintiff-side opinion on male sexual stereotyping at work.

Discriminations talks about the disparate impact theory of, well, discrimination.

Finally, The Word on Employment Law with John Phillips draws some employment law lessons from Sesame Street.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Big verdict underscores importance of background checks

One would think that businesses with whom people entrust children or the elderly would conduct routine criminal background checks of its employees. In fact, in Ohio, it’s the law. At least one employer, however, an assisted living facility in Newport News, Virginia, unknowingly hired an employee with a long criminal history, including assault and battery. On May 28, a jury found the facility liable for failing to exercise reasonable care in hiring the former felon. The lawsuit involved the employee’s sexual assault of a resident. The ex-employee has been criminally charged with five forcible sodomy counts, three carnal knowledge counts, and one abuse and neglect count. For these acts, the jury awarded the abused resident $750,000 in damages.

There is a good lesson for all employers to learn from this example. Backgrounds checks are inexpensive. The potential exposure from hiring an employee with a criminal history, however, is large. Do your bottom line and the safety of your employees a favor and consider implementing routine criminal background checks for all employees. For information on how to use this information without running afoul of EEO laws, I recommend EEOC targets use of arrest and conviction records.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Drafting a social networking policy: 7 considerations

I could draft a perfect social networking policy using only a few words: “Be mature, be ethical, and think before you type.” Ultimately, you may decide that such brevity is what you want for you business. For the sake of completeness, though, I offer seven thoughts to consider when drafting a social networking policy.

1. How far do you want to reach? Social networking presents two concerns for employers – how employees are spending their time at work, and how employees are portraying your company online when they are not at work. Any social networking policy must address both types of online use.
   
2. Do you want to permit social networking at work, at all? It is not realistic to ban all social networking at work. For one thing, you will lose the benefit of business-related networking, such as LinkedIn. Without turning off internet access or blocking certain sites, a blanket ban is also hard to monitor and enforce.
   
3. If you prohibit social networking, how will you monitor it? Turning off internet access, installing software to block certain sites, or monitoring employees’ use and disciplining offenders are all possibilities, depending on how aggressive you want to be and how much time you want to spend watching what your employees do online.
   
4. If you permit employees to social network at work, do you want to limit it to work-related conduct, or permit limited personal use? How you answer this question depends on how you balance productivity versus marketing return.
   
5. Do you want employees to identify with your business when networking online? Because this blog is affiliated with my law firm, Kohrman Jackson & Krantz, I am cognizant that everything I write reflects on my partners and my business. Employees should be made aware that if they post as an employee of your company, the company will hold them responsible for any negative portrayals. Or, you could simply require that employees not affiliate with your business and lose the networking and marketing potential Web 2.0 offers.
   
6. How do you define “appropriate business behavior?” Employees need to understand that what they post online is public, and they have no privacy rights in what they put out for the world to see. Anything in cyberspace can be used as grounds to discipline an employee, no matter whether the employee wrote it from work or outside of work. There should be consequences for any information that negatively reflects on your business.
   
7. How will social networking intersect with your broader harassment, technology, and confidentiality policies? Employment policies do not work in a vacuum. Employees’ online presence, depending on what they are posting, can violate any number of other corporate policies. Drafting a social networking policy is an excellent opportunity to revisit, update, and fine-tune other policies.
   

For more information on social networking, revisit yesterday’s post -- Do you know? Facebook and Twitter and blogs, oh my! What is social networking and why should you care?

Do you know? Facebook and Twitter and blogs, oh my! What is social networking and why should you care?

Cave drawings were likely the earliest form of social networking. Today people tweet their thoughts for the world to see. In between we’ve had instant messaging, MySpace, Facebook, and blogs. The next several big things are already being hatched by some students at Stanford or MIT. Online social networking is here to stay – the only change will be in what form it takes.

According to a recent survey conducted by Deloitte, 22% of employees say that they use some form of social networking five or more times per week, and 15% of employees admit they access social networking while at work for personal reasons. Yet, only 22% of companies have a formal policy that guides employees in how they can use social networking at work.

Before we can figure out what to do about these exploding media at work, we first need to know exactly what we are dealing with. So, for the uninitiated, the following is a short lesson on the various types of social networking that are likely being accessed from your workplace right now.

• Blogs: Blog is short for weblog. Blogs either provide commentary on news or a particular subject (such as the Ohio Employer’s Law Blog), or serve as an online diary. Most are text-based, but blogs can also focus on art, photos, videos, and audio (you may have heard of podcasts). There are hundreds of millions of blogs on the internet, many updated as often as every day.
  
• Facebook: Facebook started as an online tool for college and university students to connect with each other. It has since expanded to allow anyone over the age of 13 with a valid email address to open a free account. It is loosely organized into a variety of networks based on schools, location, employers, charities, and other causes. Connections are known as “friends.” People update with short written blurbs about what they’re doing, pictures, video, and the like. Users can also post on friends’ pages. If you’re not on Facebook, I guarantee someone you know is. In fact, Facebook has over 200 million registered users. Even my mom has a Facebook page.
  
• LinkedIn: LinkedIn is an online network for professionals. It allows people to search and connect via alma mater, location, employer, or various user-created groups. It has over 41 million members.
  
• Twitter: Twitter is latest big-thing in social networking. It is what is known as “micro-bloggings.” “Tweets” are text-based posts of up to 140 characters, displayed on the user’s profile page and delivered to followers, other users who have subscribed.
  

Employers have three options to try to regulate social networking by employees at work: 1) turn off their internet access; 2) institute progressively harsher discipline against employees caught Facebooking or tweeting at work; or 3) draft a reasonable policy that recognizes the intersection of technology in the workplace and employees’ lives, and establishes reasonable baseline expectations about what is and is not acceptable use at work. Only the latter option makes any real sense.

Tomorrow, we’ll explore the pieces and parts that comprise a useable social networking policy. Until then, feel free to follow my 140 character thoughts on Twitter @jonhyman.

Let’s start the week with a laugh

So much of the news is doom and gloom, I thought I’d start everyone’s week with a little humor from one of my all-time favorite movies, Office Space. If you haven’t seen it, it’s definitely worth queuing on Netflix. Besides being hilarious, it offers an excellent glimpse in how not to manage employees.

Back to more substantive stuff tomorrow, I promise.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

BREAKING NEWS: En banc panel of 6th Circuit reverses prior holding in Thompson v. North American Stainless and rejects associational retaliation claims

There are many types of relationships among employees in a workplace besides being co-workers. Many employees develop close friendships. Many businesses employee individuals from the same family – parents and their children, siblings, cousins, etc. Some employees work with their spouse. And some friendships develop into more, leading to dating, engagement, and even marriage.

Suppose an employee files a charge with the EEOC, and three weeks later, that employee’s fiancée is fired? Does the fiancée have a retaliation claim? Despite the fact that the fiancée engaged in no protected activity of his own, early last year in Thompson v. North American Stainless, the 6th Circuit permitted the employee to proceed with a retaliation claim by recognizing a claim for associational retaliation:

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).

This morning, an en banc panel of the same court overturned its prior holding and expressly rejected this theory of associational retaliation.

Significantly, Thompson does not claim that he engaged in any statutorily protected activity, either on his own behalf or on behalf of Miriam Regalado…. By application of the plain language of the statute, Thompson is not included in the class of persons for whom Congress created a retaliation cause of action because he personally did not oppose an unlawful employment practice, make a charge, testify, assist, or participate in an investigation….

We must look to what Congress actually enacted, not what we believe Congress might have passed were it confronted with the facts at bar. For the reasons we have laid out, it was not “absurd” for Congress to limit the class of persons who are entitled to sue to employees who personally opposed a practice, made a charge, assisted, or participated in an investigation. Our interpretation does not undermine the anti-retaliation provision’s purpose because retaliation is still actionable, but only in a suit by a primary actor who engaged in protected activity and not by a passive bystander.

Retaliation continues to be of the most dangerous employment-law risks to face employers. By limiting this potential liability, this decision is a huge win for Ohio businesses. Employers no longer have to worry about how close of a relationship is close enough for a potential retaliation claim. As far as retaliation is concerned, employers need only worry about employees who actually engage in their own protected activity. Isn’t that enough for employers to worry about? 

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

WIRTW #82

I have a confession to make. I’ve never watched an episode of Jon & Kate Plus 8. I know that I am confessing to being a pop-culture Neanderthal. I guess I can live with that. This week, the Pennsylvania Labor Department launched an investigation into whether the show violates child labor laws. Michael Moore at the Pennsylvania Labor & Employment Blog and Jeffrey Hirsch at the Workplace Prof Blog have the details. For more information on child labor laws generally, check out Jennifer Hays’s thoughts at the Warren & Hays Blog.

I have another confession to make. I had been working on a piece that draws some lessons on talent management from the Cavs’s crushing loss in the Eastern Conference Finals. The HR Capitalist beat me to it.

During a White House press conference earlier this week, White House Press Secretary Robert Gibbs offered what can best be described as lukewarm support for the Employee Free Choice Act. LaborPains.org details his comments. Meanwhile, Michael Fox at Jottings by an Employer’s Lawyer reminds everyone that card check is only one of three key parts of the EFCA. In other labor law news, Michael Maslanka at Work Matters draws three important lessons from a recent viewing of Norma Rae.

BLR’s HR Daily Advisor ran a two part series this week on how to avoid lawsuits during a RIF: Part One and Part Two.

The Word on Employment Law with John Phillips, on playing hardball with former employees.

Patrick Smith at the Iowa Employment Law Blog talks about the legal risks in asking exempt employees to take time off for economic reasons. For my thoughts on this issue, see Do you know? Mandatory unpaid time off may affect salaried employees’ exemptions.

Employment Law Bits has information on potential paid sick leave legislation.

Wage Law itemizes some of Supreme Court nominee Judge Sonia Sotomayor’s more important employment law opinions.

Ann Barnes at Compensation Force details a recent survey of severance pay and other separation policies.

Jay Shepherd at Gruntled Employees thinks Twitter will kill annual employee performance reviews.

The Laconic Law Blog reports on a decision out the D.C. Circuit discussing the distinctions between employees and independent contractors.

Becky Regan at Compensation Cafe lists 7 considerations for an effective sales plan.

Finally, I Hate People...But It's Nothing Personal reminds everyone that while it’s easy to hate lawyers, “savvy lawyers save your company time, aggravation and money.” Well said.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

3 lessons in handling workplace harassment

Gallagher v. C.H. Robinson Worldwide (6th Cir. 5/22/09) [PDF] offers an excellent example of how businesses get themselves into trouble by failing to actively and effectively police workplace offensive conduct.

Julie Gallagher began working at C.H. Robinson Worldwide, a Cleveland trucking company, in September 2002. She held an office job at CHR, working with two dozen other employees in a relatively small office. She quit CHR after only four months. In the interim, she claims that she was subjected to repeated sex-based harassment and offensive conduct, including:

• The prevalent use of foul language by mostly male coworkers who openly and loudly referred to female customers, truck drivers, coworkers and others as bitches, whores, sluts, dykes and cunts.
• The frequent display of pornographic websites and magazines.
• Co-workers who shared nude pictures of their girlfriends in different sexual poses.
• Male co-workers who daily traded sexual jokes and engaged in graphic discussions about their sexual liaisons, fantasies, and preferences.
• One co-worker angrily called her a “bitch” on several occasions.
• Male co-workers called her fat, a “heifer” with “milking udders,” and “moo”ed at her. 

Gallagher admitted that she did not avail herself of CHR’s formal harassment policy and complaint mechanism, but did sometimes complain to the branch manager, Greg Quast, to no avail.

The trial court granted CHR’s summary judgment motion and dismissed Gallagher’s case. The 6th Circuit, however, reversed and sent the case back for trial. Why? And what can employers learn from this case?

1. Offensive conduct can be “based on sex” whether or not it is directed at a woman. In this case, most of the complained of harassment was not directed at Gallagher, but was explicitly sexual and degrading of women in general. Such conduct is actionable whether or not the complaining employee is specifically targeted. The lesson: Employers should not ignore harassment complaints just because the complaining employee was only subjected to general workplace misconduct.

2. A jury could conclude that the harassment was severe and pervasive: “Considering the totality of the circumstances …, the conclusion is inescapable that a reasonable person could have found the Cleveland office—permeated with vulgar language, demeaning conversations and images, and palpable anti-female animus—objectively hostile.” The lesson: Businesses are not fraternity houses, and employers that allow frat-like antics to permeate the workplace will often find themselves on the losing end of a harassment lawsuit.

3. The branch manager should have taken greater steps to correct or remedy the harassment: “It is true that Gallagher did not report all of her concerns to Quast and did not necessarily characterize all of her complaints as sexual harassment complaints. Still, when the conduct Gallagher did report to Quast is considered alongside the pervasive conduct Quast himself witnessed, it can hardly be denied that there is a genuine fact issue as to what Quast, and therefore C.H. Robinson, knew or should have known.” The lesson: Once management knows or should know of inappropriate conduct (whether by a complaint or otherwise), it cannot borough its head in the sand, but must undertake a reasonable investigation and implement prompt remediation if warranted.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Ohio Supreme Court confirms 180-day statute of limitations for most age discrimination claims

Ohio has what can best be described as a disjointed statute for age discrimination claims. Chapter 4112 of the Ohio Revised Code has four different provisions that cover age discrimination:

4112.14(B)	While a six-year statute of limitations applies to claim under this section, it provides limited remedies – lost wages and benefits, reinstatement, costs, and attorneys’ fees.
4112.02(N)	An age-discrimination claim under this section must be brought within 180 days of the alleged unlawful practice. Unlike 4112.14(B), it allows for the full list of available remedies, including compensatory and punitive damages.
4112.05	Allows for an individual to file an administrative charge with the OCRC, but acts as an absolute bar to filing a civil action in court for age discrimination.
4112.99	Provides an independent civil action to seek redress for any form of discrimination identified in Chapter 4112, including age discrimination.

 

In January 2008, the Hamilton County Court of Appeals held, in Meyer v. United Parcel Serv., Inc., that 4112.99 creates its own independent cause of action for age discrimination, which is subject to its own six-year statute of limitations. At the time, I argued that the Meyer case was an anomaly, and that the conventional 180-day statute of limitations for claims under 4112.02(B) was likely still good law. Yesterday, the Ohio Supreme Court agreed with my instincts and reversed the Meyer decision. In Meyer v. United Parcel Serv., Inc. (6/2/09) [PDF], the Ohio Supreme Court held that 4112.99 does not create its own cause of action, but instead any age claim brought under 4112.99 is merely subject to the specific provisions of 4112.02 and 4112.14.

Thus, a plaintiff only has 180 days to pursue an age claim and seek full remedies. Thereafter, any age claim brought up to six years hence would be restricted to 4112.14(B)’s limited damages. A plaintiff can still plead an age claim under 4112.99, but ultimately will have to elect either 4112.02 or 4112.14 as the statute under which the claim is being brought.

While Meyer may not break new ground, employers should nevertheless breathe a sigh of relief that the appellate court’s anomalous opinion was reversed. Employers will continue to enjoy Ohio’s very short window for individuals to seek a full slate of damages for age discrimination. 

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Do you know? Sexual orientation and gender identity discrimination

It strikes me as appalling that in the year 2009 there are still minority groups against whom it remains legal to discriminate. An employer can blatantly state that the reason for an employee’s termination is that employee’s sexual orientation, with little risk of legal repercussion. Recognizing this anachronism, some courts have permitted claims by creative attorneys under Title VII for sexual stereotyping. Such recognition, however, varies from judge to judge and court to court, with no uniformity or certainty.

If the Ohio legislature has its way, however, this type of discrimination will end. House Bill No. 176 seeks to add “sexual orientation, gender identity and expression” to the categories of protected classes against whom it is illegal to discriminate in employment decisions in Ohio. Under the statute as proposed, “Sexual orientation” would include “actual or perceived heterosexuality, homosexuality, or bisexuality,” and “gender identity and expression” would include the gender-related identity, appearance, or expression of an individual regardless of the individual’s assigned sex at birth.” The latter is much more controversial than the former, and will also likely be the subject of vigorous debate in Washington D.C. over a potential federal ban of the same types of discrimination.

Many companies have already made the personal decision to prohibit these types of discrimination. For those that have not, if sexual orientation and/or gender identity discrimination becomes illegal policies will have to be rewritten and employees and management will have to be retrained. Keep watching this space for further updates on this important issue.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Confidentiality of personnel records help protect employers from defamation liability

Most people are not confrontational by nature. Maybe that is why many employers are lax about accurately documenting employees’ performance problems. People like to give others the benefit of the doubt, not make waves, and not hurt feelings. It only becomes a problem when an employee becomes an ex-employee and files a lawsuit. At that point, it becomes difficult to explain why an employee with good performance reviews and scant written discipline was fired for performance problems.

One thing that businesses should not have to worry about from negative information in employees’ personnel files is defamation liability. Outlaw v. Werner (Cuyahoga County 5/21/09) [PDF] involved a patient who sued her doctor for defamation based on negative information written in her chart. In affirming the dismissal of her defamation claim, the court commented that defamation liability cannot be premised on information that is kept confidential. Most employers would agree that employees’ personnel files are confidential. Indeed, not even the employee has a right to see his or her own file. Nevertheless, it is not a bad idea to build a policy into your handbook making clear that personnel files are confidential.

For more on the importance of accurately documenting employees’ performance histories and problems, take a look at the following posts from the archives:

• A textbook example in handling a problem employee.
• ‘Tis the season… for employee theft.
• Failure to document performance problems dooms employer's defense.
• Penny-wise, pound-foolish employment practices.
• And finally, Document, document, document!

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

WIRTW #81

This week’s top labor and employment story is undoubtedly President Obama’s nomination of Judge Sonia Sotomayor to the U.S. Supreme Court. For coverage of this historic event, read the thoughts of my fellow bloggers: Compensation Cafe; Connecticut Employment Law Blog; HR Lawyer’s Blog; Jottings By An Employer’s Lawyer; The Word on Employment Law with John Phillips; Warren & Hays; and World of Work.

I recently discovered an excellent blog on workplace conflict and corporate cultures -- I Hate People...But It's Nothing Personal. For a good idea of what this blog is all about, I recommend their post on management checking out employees’ Facebook pages.

Also on the topic of social networking, Anne Barnes’s Compensation Force discusses management efforts to regulate this exploding media.

This week also brings us a couple of interesting posts on sexual harassment. Mindy Chapman’s Case in Point talks about how to handle same-sex harassment complaints. On.point reports that a judge has reduced a sex harassment verdict from $100,000 to $26,500 to account for the plaintiff’s habit of exposing her own genital piercing to co-workers.

In age discrimination news, Jennifer Warren at the Warren & Hays Blog suggests that younger employees are being more greatly affected by the recent wave of layoffs. Patrick Smith at the Iowa Employment Law Blog reports on the rise of age claims and provides some practical tips on how to avoid them.

It looks like federally mandated paid sick leave is becoming more and more likely, at least according to Michael Haberman’s HR Observations and Michael Moore’s Pennsylvania Labor & Employment Blog.

Nick Fishman at the Employeescreen IQ Blog discusses background screening in a down economy.

Your HR Guy talks about why exit interviews don’t work.

World of Work reports on a Montana Supreme Court decision which held that exotic dancers are employees and not contractors.

Smooth Transitions shares some thoughts on how to prosecute a trade secret claim against an ex-employee.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

A cautionary lesson in litigation management

10 years ago, an Atlanta restaurant fired its highest ranking female manager. Last month, a federal jury finally dismissed her sexual harassment case. The latest verdict was the third handed down by a federal jury in the last five years. In the interim:

• The employer won the first jury trial in 2004.
• The employee appealed, and the 11th Circuit sent the case back down for retrial, but ordered a mediation before case could be retried.
• At the second trial, the employee won a $2.05 million verdict.
• This time, the employer appealed, and the 11th Circuit again sent the case back down for retrial, with yet another court-ordered mediation.
• Facing insurmountable defense costs and having to post a bond to secure the multi-million dollar verdict on appeal, the restaurant went into bankruptcy.

Law.com quotes the plaintiff’s lawyer, Edward D. Buckley III: “The moral of the story is that there is real value to settling these kinds of cases for both parties. That is something that there were many occasions when it could have occurred, but unfortunately it didn't. The 11th Circuit urged us to engage in meaningful settlement discussions. At least one of the district judges involved in the case urged us [to settle] and tried to facilitate that. Unfortunately, it didn't happen.”

Let this case serve a lesson for all businesses. This case spun out of everyone’s control – the lawyers and the parties. If everyone had put emotion aside (and their is no doubt that three trials and two appeals over 10 years is fueled purely by anger or spite, and not common sense and reason), the plaintiff would have realized that a guaranteed something is better than a roll of the dice, and the employer would have realized that paying a settlement is better than losing everything on principle.

I’m not arguing that the parties should have caved as soon as the case was filed. Indeed, some cases can only be resolved by a trial. After that trial, however, the parties should have listened to the court and viewed the verdict for what it was -- an opportunity to settle, not a reason to fight on.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

The (im)morality of layoffs?

Money, not morality, is the principle commerce of civilized nations.

--Thomas Jefferson

In the May 24 New York Times, ethicist Randy Cohen argues that it is unethical for American businesses to engage in mass layoffs:

These days such mass layoffs are sadly unsurprising, but are they ethical?… They are not, at least until more benign tactics have been exhausted….

To deprive thousands of people of their livelihood can have a catastrophic effect on them, their families and their communities. For a company to get through a recession, suffering may be unavoidable, but ethical management means minimizing that hardship, spreading the pain equitably and bearing some responsibility for its consequences….

Before adopting the ethics of the overcrowded lifeboat, before tossing thousands of non-millionaires over the side, gentler — and more equitable — methods must be tried. Everyone’s hours might be reduced, diffusing the pain. Dividends to stockholders can be eliminated. Pay cuts can be instituted company-wide, with the deepest reserved for the highest paid (that is, those most able to endure them).

Mr. Cohen is selling employers short. I work with a lot of companies, many of which have, with much regret, been forced to downsize their workforces in the past few months. I can assure you it is never a decision taken lightly, or without careful deliberation. Certainly, layoffs are an opportunity for employers to shed some dead weight. Many good employees are also impacted, though. Those businesses that can offer economic help to severed employees do so, in varying sized packages. Others have considered alternate plans, such as furloughs, alternate work schedules, or wage reductions.

For some businesses, however, whether because of the need of their operations or the composition of their workforces, layoffs are the only viable option. A paycheck for some is better than a paycheck for none.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Do you know? When it is lawful to take deductions from an employee’s pay?

For an employer to claim that an a professional, administrative, or executive employee is “exempt,” and therefore ineligible to receive overtime compensation, the employee must be salaried. An employee is paid on a salary basis when the employee receives the same amount of pay each pay period, without any deductions.

Despite the general rule against deductions from salaries, the Department of Labor’s rules permits employers to make deductions without risking an employee’s exemption in seven specific instances:

1. When an exempt employee is absent from work for one or more full days for personal reasons, other than sickness or disability.   
   
2. For absences of one or more full days occasioned by sickness or disability (including work-related accidents) if the deduction is made in accordance with a bona fide plan, policy or practice of providing compensation for loss of salary occasioned by such sickness or disability.   
   
3. While an employer cannot make deductions from pay for absences of an exempt employee for jury duty, attendance as a witness, or temporary military leave, the employer can offset any amounts received by an employee as jury fees, witness fees, or military pay for a particular week against the salary due for that particular week.
   
4. For penalties imposed in good faith for infractions of safety rules of major significance.    
   
5. For unpaid disciplinary suspensions of one or more full days imposed in good faith for infractions of workplace conduct rules imposed pursuant to a written policy applicable to all employees.  
   
6. For any time not actually worked during the first or last week of employment.
   
7. For any time taken as unpaid FMLA leave.
   

It is critical for businesses with salaried employees to familiarize themselves with these rules. A mistaken deduction could prove costly. Generally speaking, if an employer makes a deduction from the amount paid, the exemption will be lost during the time period during which the improper deduction was made. The lost exemption does not only apply to the affected employees, but also to all employees in the same job classification working for the same managers responsible for the actual deduction.

The Department of Labor also provides a safe harbor for employers that have a clearly communicated policy that prohibits the improper pay deductions, and which includes a complaint mechanism, reimburses employees for any improper deductions, and makes a good faith commitment to comply in the future.

Before you implement a policy or practice of docking the pay of salaried employees, it is best to consult with experienced employment counsel to evaluate employees’ job classifications and exemptions, to examine the proposed deductions, and to review or draft an appropriate safe harbor policy.

WIRTW #80

This week’s most popular topic is the Supreme Court’s AT&T v. Hulteen [PDF] decision. That case held: “An employer does not necessarily violate the PDA when it pays pension benefits calculated in part under an accrual rule, applied only pre-PDA, that gave less retirement credit for pregnancy than for medical leave generally.” I agree with Michael Fox that “[i]f the case had gone the other way, it is possible to imagine how it could have had broad ramifications. However, given its narrow holding, it seems unlikely to be very important beyond its impact on the parties.” For more details and commentary, click over to the following laundry list of employment blogs: California Workforce Resource Blog, Connecticut Employment Law Blog, Daily Developments in EEO Law, Delaware Employment Law Blog, Labor & Employment Law Blog, LawMemo Employment Blog, Nolo’s Employment Blog, SCOTUS Blog, Workplace Prof Blog, and World of Work.

Social networking and its impact in the workplace continue to be a hot topic among employment bloggers:

• Where Great Workplaces Start suggests that employees maintain separate on-line profiles for their personal and professional lives.

• BLR’s HR Daily Advisor provides a concise primer on workplace web 2.0 issues.

• HR World discusses the natural disconnect between employers and employees on the issue of social networking.

• The ABA Journal reports on the legal issues of Twitter.

• Dan Schwartz at the Connecticut Employment Law Blog compiled a list of 10 employment law twitterers to follow.

• For those that tweet, you can follow me @jonhyman.

In related news, Robert Ambrogi at the Legal Blog Watch notes that a New Zealand judge has okayed service of process by Facebook.

Sindy Warren at the Warren & Hays Employment Blog discusses the recent trend in courts protecting transgendered employees.

Donna Seale’s Human Rights in the Workplace gives the following very good advice – have regular harassment training.

Natalie Beck at the Employeescreen IQ Blog talks about the dangers that lurk when companies skip background checks.

Kris Dunn, The HR Capitalist, gives his very pro-business take on the EFCA’s binding arbitration requirements.

The Iowa Employment Law Blog lists some challenges HR will face this year.

Fair Labor Standards Act Law suggests that employers read the fine print in their EPL policies to check if wage and hour claims are covered. My guess, based on past experience, is that they are not.

Frank Roche’s KnowHR Blog asks, “How do you handle weirdos at work?”

Finally, Texas attorney Michael Maslanka at Work Matters quotes the Talmud for some words to live by for employers and employees alike: “What is hateful to you, do not to your fellow man. This is the law: all the rest is commentary.” In other words, follow the golden rule and all else should fall into place.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Supreme Court’s expanded pleading rules give employers added tool to combat lawsuits

Today, I am going to get a little academic, but I promise I’ll bring it back around at the end with some practical information for employers.

Two years ago, in Bell Atlantic Corp. v. Twombly [PDF], the U.S. Supreme Court ruled that to state a legal claim and survive a motion to dismiss, a legal pleading (the initial filing in a lawsuit) cannot simply recite the elements of a cause of action or make an unsubstantiated conclusion, but must set forth a claim that is “plausible on its face.” The Court explained:

Federal Rule of Civil Procedure 8(a)(2) requires only “a short and plain statement of the claim showing that the pleader is entitled to relief,” in order to “give the defendant fair notice of what the … claim is and the grounds upon which it rests. While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff’s obligation to provide the “grounds” of his “entitlement to relief” requires more than labels and conclusions, and a formulaic recitation of a cause of action’s elements will not do. Factual allegations must be enough to raise a right to relief above the speculative level on the assumption that all of the complaint’s allegations are true. (internal citations omitted).

For example, in discrimination case, I sometimes see complaints that simply say, “X was terminated because of his race in violation of Title VII.” While Twombly was an antitrust case, if it’s rationale extended to employment cases these types of pleadings would not suffice. Twombly, however, left open the question of whether it applied beyond the antitrust arena.

Earlier this week, the Supreme Court decided Ashcroft v. Iqbal [PDF], which extended the Twombly pleading rules to an unlawful detention case. In the wake of the Court’s expansion of Twombly outside the antitrust context, it is likely that its pleadings requirements will apply in all civil litigation. In other words, a discrimination plaintiff should no longer be able to simply speculate that discrimination occurred, or make bald, unsubstantiated conclusions. A discrimination plaintiff will have to plead sufficient, specific facts to at least put the employer on notice of what is alleged to have actually happened.

The Ashcroft decision has three big practical implications for employers:

1. Employees will be required to file much more detailed complaints, and employers will know at the earliest stages of the lawsuit exactly what is being alleged. Employers will no longer have to engage in expensive discovery just to learn the theory of the plaintiff’s case.

2. Employers will be able to make more accurate analyses of cases earlier. Earlier analysis of a case’s strengths and weaknesses will allow employers to decide early in the litigation whether a case is worth fighting, or should be settled earlier. Thus, companies should save defense costs.

3. More lawsuits should be dismissed for failing to state a claim. In theory, the less meritorious lawsuits will fall by the wayside, saving businesses the cost of defending nuisance lawsuits.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.

Alternative compensation plans pose wage and hour risks

Employees can be paid in many different ways: an hourly rate, an annual salary, by commission, by piece, a flat rate, with additional established or discretionary bonuses, or in some combination of any of the above. The more creative an employer becomes in how it compensates its employees, the more risks it takes under the wage and hour laws. Baden-Winterwood v. Life Time Fitness, Inc., decided earlier this week by the 6th Circuit, provides a good illustration of how certain alternate compensation schemes can jeopardize employees’ exemptions and render an employer liable for unpaid overtime.

Life Time Fitness paid its employees a pre-determined, semi-monthly base salary, in addition to monthly bonus payments based on year-to-date performance as set forth in a written bonus plan. For the years 2004 and 2005, the bonus plan permitted Life Time Fitness to make deductions from employees’ salary to recover prior bonus overpayments. In 2006, it amended the plan to provide that while it could still make semi-monthly salary deductions for overpayments, “[o]n an annual basis, in no case will the Guarantee Pay be lowered.”

The Sixth Circuit found that the 2004 and 2005 plans violated the FLSA, which does not permit salary deductions “for the reduction of guaranteed pay under a purposeful, incentive-driven bonus compensation plan.” Because the deductions were illegal, the employer could not claim the benefit of the FLSA’s exemptions for its employees during those years.

The loss of the exemptions in this case opened the employer to significant exposure for unpaid overtime. If you are considering implementing an alternate compensation scheme for your employees, also consider a review by experienced employment counsel to avoid a similarly expensive wage and hour miscue.

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Presented by Kohrman Jackson & Krantz, with offices in Cleveland and Columbus.

For more information, contact Jon Hyman, a partner in our Labor & Employment group, at (216) 736-7226 or jth@kjk.com.