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Legal Briefs for HR

Posted on July 3, 2013

Welcome to Legal Briefs for HR, an update on employment issues sent to over 5000 individual HR professionals, in-house counsel and business owners plus HR and legal professional organizations (who have been given permission to republish content via their newsletters and websites), to help them stay in the know about employment issues.  Anyone is welcome to join the email group . . . just let me know you’d like to be added to the list and you’re in!  Back issues are posted at www.munckwilson.com under Media Center/Legal Briefs and you can also join the group by clicking on “Subscribe.”  


It’s almost the Fourth of July, so declare your independence from these employer headaches:


1. Breaking News– The Obama administration announced today that it would delay for a year, until 2015, the Affordable Care Act mandate that employers provide coverage for their workers or pay penalties.


2. Who’s the Boss?– In 1998, the Supreme Court announced the standard for employer liability under Title VII when a supervisor harassed a nonsupervisory employee in its Ellerth and Faragher decisions.  If the harasser was not a supervisor, it was a negligence standard and there was no employer liability unless the employer knew or should’ve known about the misconduct and failed to take a prompt and effective remedial response.  The standard that applied to cases involving a harassing supervisor were much tougher, especially where a tangible job detriment had occurred.  The employer was strictly liable for a supervisor’s harassment if there had been a tangible employment detriment (e.g., fired, demoted, pay cut). The employer was presumed liable for a supervisor’s harassment, but could avoid such liability if it could successfully assert the affirmative defense.  That defense required proof that the employer was reasonable in its efforts to prevent and quickly respond to harassment AND show that the aggrieved employee had not availed him or herself of the employer’s investigative and remedial measures.  Great, but it was unclear who was a supervisor and who was not.  That was the question before the Supreme Court in Vance v. Ball State University (U.S. 6-24-13).  The Supremes decided a supervisor is one who has been empowered by the employer to take tangible employment actions such as hiring, firing, transferring to significantly different tasks, promoting or other decision that causes a significant change in benefits.  Those with lesser roles, such as allocating duties and commenting on job performance, are not supervisors for purposes of Title VII vicarious liability.  The Court strongly renounced the standard applied by the EEOC in its enforcement guidance as “a study in ambiguity.”  Oh yes, they did.


3. Retaliation Rejiggered– The Supreme Court had more good news for employers, in a case that examined what was necessary to establish a Title VII retaliation claim.  Back in 1991, Congress set the standard so that plaintiffs could prevail on a discrimination claim by showing unlawful bias was a motivating factor in the adverse employment action at issue, but courts have been split over whether that was the correct standard to use in retaliation cases.  Those inconsistent views tend to bubble up to the Supreme Court eventually and did, in University of Texas Southwestern Medical Center v. Nassar (U.S. 6-24-13), where it was decided that a plaintiff bringing a Title VII retaliation claim must show that the adverse employment action (e.g., fired, demoted, pay cut) would not have happened “but for” the employer’s improper, retaliatory motive.  In other words, if there is a legitimate, non-retaliatory reason for the action taken, the employer can win even if there was also some improper motive.  This case provides another reminder that good documentation of poor performance, erratic attendance and flouting of work rules will be essential to defeating a retaliation claim.


4. Recess Appointment Update– The Supreme Court has accepted the NLRB’s request to review the decision of the D. C. Circuit in the Noel Canning case, which declared President Obama’s so-called recess appointment of three new members to the NLRB as unconstitutional (because the Senate was not in recess at the time).  The appeal should be heard during the next term of SCOTUS, which begins on October 7, 2013.


5. DOMA Undone– The Supreme Court determined that the Defense of Marriage Act’s section  3 exclusion of state-sanctioned same-sex marriages from the federal definition of marriage is unconstitutional.  U.S. v. Windsor (U.S. 6-26-13).  There is much to be unwrapped here, since that impacts more than 1,100 federal statutes which affect “spouses” but let’s start with employee benefits and the thirteen states and D.C. which recognize those marriages. In those jurisdictions, employers will now offer health insurance benefits on the same tax-preferred basis as was done for opposite-sex married folks. This should also open the door to enrolling same-sex spouses in flexible spending plans that are used to pay for health and dependent care.  ERISA-governed retirement plans in those jurisdictions should now offer the same surviving spouse benefits as were afforded to opposite-sex married folks.  There will be a lot more to come, so stay tuned.


6. What’s Up (With That), Doc?– Employers let out a collective moan on June 18, with a press release from the American Medical Association stating it now recognizes obesity as a disease.  Many wonder if that pronouncement will open the floodgates of ADA requests for accommodation and/or claims of employment discrimination.   In that same press release, they also noted the health risks of prolonged sitting and encouraged employers to offer alternatives to sitting, such as standing work stations and isometric balls. 


7. The Posthumous Poster – Last month, LB4HR relayed that D.C. Circuit Court of Appeals struck down the NLRB’s pending rule which would’ve required most employers to display a poster about employee rights under the NLRA.  The Fourth Circuit (MD, NC, SC, VA, WV) has now joined in and agrees with that decision in striking down the requirement, although their rationale is a bit different than that used by their sister court.  Chamber of Commerce v. NLRB (4thCir. 6-14-13).  Would any other jurisdictions like to join in on this party?


8. Got Milk?  – The 5thCircuit reversed summary judgment for the employer, in a Title VII case involving a woman who was discharged while on maternity leave and whose requests to express breast milk, once she returned to work, were denied.  The EEOC filed suit on Donnicia Venters behalf and the lower court found that firing for lactation is not sex discrimination under Title VII and that lactation is not a pregnancy-related condition under the Pregnancy Discrimination Act amendment of Title VII.  The 5thCircuit disagreed with both concepts, reversed and remanded for a new trial.  EEOC v. Houston Funding II Ltd. (5thCir. 5-30-13). 


9. Summertime Reminders



  1. Interns– College and high school students are on break and looking for work.  Some are willing to work for no pay, just to get the work experience and maybe, just maybe, impress you enough to offer them future employment.  As tempting as the siren song of free labor sounds, in most cases . . . don’t!  Refresh yourself on the requisites of a unpaid internship on Fact Sheet #71, as posted by the U.S. Department of Labor at www.dol.gov/whd/regs/compliance/whdfs71.pdf. .

  2. Kids – The FLSA does allow employers to pay youths under the age of 20 a subminimum wage of $4.25 hour for up to 90 calendar days or until he/she turns 20, whichever occurs first.

  3. Hot Workers– Although not every state has a statute like CA’s (which requires employers to provide breaks with shade and cool water for those who work outside), OSHA takes the position that employers’ general duty to provide a workplace free from recognized hazards includes managing exposure to extreme heat.  If you want to go high tech, OSHA is offering a smartphone app which combines heat index info from NOAA with the individual’s precise location to determine a heat risk index, and suggests measures to avoid heat-related illness.  The app is available at www.osha.gov/SLTC/heatillness/heat_index/heat_app.html.

  4. The Other Kind of Hot Workers–  As the amount of skin revealed increases in proportion to rising summer temperatures, employers with a dress code that requires a professional appearance may need to send out some gentle reminders.

  5. Be Careful Out There – Texas Department of Public Safety/TX DOT reports that Independence Day traditionally ranks among the deadliest holiday periods on Texas highways as a result of alcohol-related crashes.  Whether you are hosting employer-sponsored picnics, ball games and similar gatherings or your employees are out on their own, remind them to avoid driving while impaired and be on the look-out for those who ignore common sense and do it anyway.

  6. Tax Holiday – Texans, mark your calendar for August 9 to 11, when you can avoid sales tax on most clothing, footwear, school supplies and backpacks priced under $100.   This equates to a savings of $8.25 on every $100 you spend.

10. Save the Date – If you like to immerse yourself in two days of labor and employment presentations, please join me in San Antonio for the Texas Association of Business and the SHRM Texas State Council 2013 ER Symposium on July 18 and 19!  Yours truly will provide a wage and hour update on July 18.  The agenda and registration info is posted on the websites of both hosting organizations, at www.txbiz.org and http://texas.shrm.org.


11. Stated Differently– Here are some hot topics for you multi-state employers:



  1. Connecticut – The Connecticut Personnel Files Act is amended, effective Oct. 1, 2013, to [1] specify that employers have seven business days to comply with an employee request to peek at his or her file; [2] the employee is entitled to a copy of the file; [3] employers have ten business day to comply with a similar request from a former employee who has been gone for one year or less and it’s OK to mail a copy rather than arranging a meeting; [4] employers who create a written disciplinary action must provide the subject employee with a copy of the warning within one business day; [5] employers who issue a written termination notice must provide it to the subject employee “immediately” upon termination of employment; [6] each written performance evaluation, disciplinary action or termination notice must include a statement that should the employee disagree with the content of the notice, the employee may provide a written rebuttal and such statement will be included with the employer’s document, whenever it is transmitted or disclosed from the file. Note that [4] and [5] do not require employers to create a written form if that is not their normal procedure . . . they only apply if there is a written document prepared.  Fines for violators are $500 for first violation and $1000 for any subsequent violation.  See SB 910 for actual language of the bill.

  2. Connecticut –Effective October 1, 2013, an employee who is presented with a non-compete agreement as a condition of continued employment after a merger or acquisition must be provided with a written copy of the agreement and at least seven calendar days in which to consider the agreement.  If these requisites are not  satisfied, the non-compete agreement is void.  The employee can waive the seven-day period, but must do so in a writing that is separate from the non-compete agreement, which specifies the right being waived and must be signed by the employee before execution of the non-compete agreement.  There are some bugs to be worked out here . . . it’s not clear whether employees bound by existing non-compete agreements must be provided with a fresh one, plus the seven days to think about it.

  3. Delaware –Effective June 19, 2013, gender identity is a class protected from discrimination in employment, housing, public works contracting, public accommodations and insurance.

  4. Illinois –The Illinois Appellate Court held that in order for there to be adequate consideration to enforce a post-employment non-compete covenant, the subject employee must have been employed by that prior employer for two years or more.  Fifield v. Dealer Services Inc. (IL App June 2013).

  5. New York (New York City) –The New York City Council overrode Mayor Bloomberg’s veto, to enact the Earned Sick Time Act.  It will take effect April 1, 2014 if the NYC economy is deemed to be as good or better than it was in January 2012 & that determination will take place on Dec. 16, 2013.  If the economy is not up to snuff, they will re-evaluate every six months.  Once it takes effect, it applies to employers with 20+  employees who work within NYC and will provide one hour of paid sick time for every 30 hours worked.  That threshold drops to 15+ employees 18 months after the law takes effect. Smaller employers must still provide the same amount of time off, but it can be without pay. The amount of time off provided is capped at 40 hours per employee, per calendar year.  The time off can be used for the employee’s own illness/injury, that of a family member or closure of the place of business or the employee’s child’s school or childcare provider, by order of a public official due to a health emergency.  New hires must be given written notice of their rights under this law, when employment begins and there is a poster requirement.

  6. Texas –Effective Sept. 1, 2013, employers have a new defense against some (but not all) negligent hiring and retention claims, where the hired individual is an ex-offender.  The defense will not be available where the prior offense was committed while performing duties that are substantially similar to the current job; where there was sexually violent offense; or for any offense listed in Section 3g, Article 42.12 of the Texas Code of Criminal Procedure, which lists offenses such as murder and aggravated robbery.

12. For the Birds – If you like being tweeted and want breaking news on employment law changes (and the occasional random cheer for K-State), follow me on Twitter.  I’m at @amross.


 


Until next time,


Audrey E. Mross
Labor & Employment Attorney
Munck Wilson Mandala LLP
600 Banner Place
12770 Coit Road
Dallas, TX  75251


972.628.3661 (direct)
972.628.3616 (fax)
214.868.3033 (iPhone)
amross@munckwilson.com

www.munckwilson.com


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