PTSD - A Primer

Posted 10:02 PM by Michael Fox

For any employer facing a lawsuit where the employee is claiming post traumatic stress disorder, Dr. Joni Johnston's article sets forth some of the basics of the diagnoses and some of the ways it is sometimes abused.

Comments: Post a Comment

Probably Not the Time To Be Pushing the White Collar Regs with the DOL

Posted 9:42 PM by Michael Fox

Or I would bet that is what Siemens Building Technologies of Seattle is thinking as they prepare to write $1.2 million in checks for unpaid overtime. The DOL, which has not been getting the best press for its efforts in trying to revise the decades old exemption regulations, did not overlook the opportunity for a little publicity of another kind in its press release discussing the settlement. Beware the Ides of March, and a regulatory enforcement agency under the publicity gun.

Comments: Post a Comment

What If You Didn't Know What the Minimum Wage Was, and No One Could Tell You?

Posted 3:43 PM by Michael Fox

Well then you would probably be a restaurant owner in New Mexico. Confusion on what to pay for tipped employees is in a legislative muddle in the Land of Enchantment. The Albuquerque Business Journal has the story. The most amazing part of the story? From the state administrator:

There haven't been any claims by workers for the higher wage in the two years that the mistake has been law, but that could change. "It's a potential problem and almost any day someone is going to come in with a wage claim, having been paid $2.12 an hour and wanting $2.57 from their employer," Bachelor says.

Any bets on how long after this article is widely circulated that it takes?

Comments: Post a Comment

In Case You Didn't Catch This In Time for Casual Friday

Posted 2:44 PM by Michael Fox

USA Today had a good article on the change of dress in today's workplace, Even on Casual Friday, don't dress for sex-cess.

Comments: Post a Comment

Has Anyone Thought of the Possible Connection Between the Litigation and the Outsourcing

Posted 2:41 PM by Michael Fox

Forbes reports on a $600,000 settlement between a Japanese company and its staffing company in a suit brought by the EEOC on behalf of temporary Filipino employees who had been discharged, Forbes.com: Sega, Spherion settle U.S. ethnic bias case. What caught my eye was the following (my emphasis added):

The 18 plaintiffs had been temporary workers placed by Spherion in Sega's game-testing department. Ironically, those jobs were all outsourced to India within a year of the dismissals, EEOC attorney William Tamayo said.

Anyone but me wonder about the connection between the litigation and the outsourcing? Talk about irony!

Comments: Post a Comment

Jerks In The Workplace - Disturbing, But Sound Advice

Posted 2:31 PM by Michael Fox

Although I just skimmed the article, it seems the bottom line conclusion on dealing with jerks is basically, just learn to live with it, because being total jerks - you aren't going to change them! Although you would have hoped for some nefarious answer that would have advocated stronger more satisfactory medicine for them, this is probably much more realistic. Check out the story aptly headlined, Why jerks get ahead in the workplace. The best solution may be a zero tolerance policy or as it is sometimes called, a "no jerk" rule. That goal loses out if not strongly enforced. The presence of a more than a handful of jerks is likely to have a disproportionate impact on the collective behavior of the group, and certainly not for the better as anyone who has seen it happen can attest.

Comments: Post a Comment

Age Discrimination and Adverse Impact - Supreme Court Will Decide

Posted 1:21 PM by Michael Fox

For the second time, the Supreme Court has taken a case that raises the issue of whether or not adverse impact cases can be brought under the Age Discrimination in Employment Act. Last time the Court ducked after oral argument and found that the writ had been 'improvidently granted.' Unlikely to do that this time. The grant was teed up as both sides basically said that it was an appropriate case if the court wanted to take up the issue. And it is a big issue, particularly for reductions in force and benefits. For some background see the story in the New York Times. The underlying case is from the 5th Circuit's determination that disparate impact is not available in age cases. Our initial report was here.

And congratulations to Tom Goldstein and his students at the Stanford law clinic who are counsel for the petitioner as mentioned here.

Comments: Post a Comment

Saturday, March 27, 2004

7th Cir. Articulates Rationale For Judging Employer Conduct In Light of 'Competition for Employees'

Posted 7:55 PM by Michael Fox

Although not remarkable for its ultimate holding (finding a denial of disability benefits is not an abuse of discretion when supported by medical opinion), the 7th Circuit, as it frequently does, uses simple language to articulate a concept often overlooked by other courts and policy makers: employers' conduct should be viewed in light of their economic need to obtain the best employees from the market place. The money quote here:

After all, the Mercantile Exchange has no reason to deceive its employees about the quality of fringe benefits on offer; that would just besmirch its reputation and make it harder to hire good people in competition with other financial institutions.

Leipzig v. AIG Life Insurance Company (7th Cir. 3/25/04) [pdf].

Several years ago, testifying before the Texas legislature on behalf of TAB against, yet another, poorly drafted piece of legislation, I tried to make the point that there was something to be said for not mandating every conceivable positive action by an employer, so that those who voluntarily took progressive steps could distinguish themselves in the marketplace for talent. Clearly, I would have had a more understanding audience with members of the 7th Circuit Court of Appeals.

Comments: Post a Comment

7th Cir. Finds Fact Questions In WARN Act Case

Posted 7:29 PM by Michael Fox

There are not that many WARN act decisions, and even fewer dealing with attempts where the employer did not provide the notice because of business circumstances that were not reasonably foreseeable at the time the WARN notice should have been provided. Here, a hog slaughtering operation's were shut down by the USDA's refusal to allow their products to be shipped. After several pages stating the facts, which made me feel both sorry for the owners who seemed to be trying to do the right thing and losing lots of money in the interim as well as the USDA which seemed serious about protecting the country's meat supply, the Court found that a fact question exists, so it reversed the summary judgment for the employer. Pena v. American Meat Packing Corp. (7th Cir. 3/25/04) [pdf]. The issue for the fact finder was whether or not a reasonable, similarly situated business person would have not foreseen the likelihood of being shut down based on the past notices of performance problems. And the consequences are not insubstantial as there were 350 plaintiffs who got no notice.

If you think about it, the decision is not very supportive of an entrepenurial system as in this case it may very well penalize an unsophisticated businessperson who may with the best of intentions thought he could push forward and survive, only to be pulled up short by governmental action.

Comments: Post a Comment

Wednesday, March 24, 2004

Why An Employer's Response to the EEOC Is Important - Hernandez Wins This Round with Raytheon

Posted 5:00 PM by Michael Fox

When we last visited Hernandez v. Raytheon, we thought that even though the Supreme Court basically punted, and sent the case back, based on the evidence in the Court's opinion, the employer might have a good chance under the disparate treatment analysis. See our report here. This was the case where Raytheon (in its Hughes Missile division) had refused to rehire Hernandez because he had been terminated for having failed a drug test. The Company had argued in the Supreme Court that the termination was based on its unwritten policy of not re-hiring employees who had been terminated for violation of a company rule.

In an unhappy turnaround for the company, there was more to the evidence of the case. Yesterday the 9th Circuit reversed the summary judgment using a disparate treatment analysis, thus correcting the flaw that caused the temporary victory by the employer at the Supreme Court. Hernandez v. Hughes Missile Systems (9th Cir. 3/23/04) [pdf]. And to make matters worse, the Court found its evidence to deny the summary judgment and of possible pretext by comparing the company's EEOC position statement with the position it took in the course of litigation:

Further, a finder of fact could reasonably infer that Hernandez's history of addiction, not an oral policy, actually motivated Bockmiller's decision not to re-hire him. In Raytheon's written explanation to the EEOC of its reasons for refusing to consider Hernandez's application it admitted that the refusal to re-hire was based on Hernandez's history of substance abuse.4 See Position Statement, infra, p. 3581 ("[Hernandez's] application was rejected based on his demonstrated drug use while previously employed and the complete lack of evidence indicating successful drug rehabilitation.").Raytheon's first mention of its purported "unwritten policy" of uniformly refusing to re-hire individuals previously fired for misconduct occurred after EEOC reconciliation efforts had terminated, and Hernandez had brought this action against the company. From the fact that Raytheon has provided conflicting explanations of its conduct, a jury could reasonably conclude that its most recent explanation was pretextual. See E.E.O.C. v. Sears Roebuck & Co., 243 F.3d 846, 853 (4th Cir. 2001) ("[A] factfinder could infer from the late appearance of [the employer?s] current justification that it is a post-hoc rationale, not a legitimate explanation for [its] decision not to hire [the employee].") ... (emphasis added)

Ouch! And the employer's attempts to lay the blame elsewhere met with little success as noted in footnote 4:

4 Raytheon now attempts to disavow its admission by asserting that it was drafted by an uninformed part-time employee and, therefore, Raytheon and Medina cannot be held accountable for its contents. The attempted disavowal serves at best to raise a question of fact, particularly as Medina testified in his deposition not only that he signed the statement after having read it, but that the information in it was correct.

Ouch again. I have often said it is unfortunate but true, that you must present the same argument in your initial response to an EEOC charge, that you intend to present if the case ever goes to trial. And apparently that rule holds true, even if you manage to get the case to the Supreme Court.

Labels: EEOC

Comments: Post a Comment

Democrats Win Today's Overtime Battle

Posted 1:02 PM by Michael Fox

Even as I was writing about the continuing fight over the OT amendments, the Senate battle was being fought. According to the AP story, the Republicans were unable to shut off debate on the amendment which had been added to a major trade bill. Since both sides want to pass the trade bill, it will be interesting to see who blinks. Senate Majority leader Bill Frist apparently switched his vote to no, which allows him to have the matter reconsidered later. Stay tuned.

Comments: Post a Comment

Vote on Murray Offering Not Yet Getting Much Press; Overtime Reg Fight Back In the News

Posted 12:47 PM by Michael Fox

Given the substantive impact of Senator Patty Murray's amendment to a bill that will be voted on this week, reported here last week, it is somewhat amazing how little attention it has gotten from the mainstream media. Although easy to miss something, a quick on-line search shows only comments from Paul Kersey, a fellow at the Heritage Foundation, Domestic Violence Amendment Is Unnecessary and Burdensome and a piece in the National Review Online. Fortunately, they both note that the passage of such momentous legislation without more study is not a good idea. From e-mail communications I have received I know that the HR community is mobilized to educate the Senate on the dangers of the bill in its current form. Hopefully that will convey the message.

Another contentious employment law issue is once again front and center in the Senate, with a vote scheduled for today on an amendment to block the DOL's attempt to amend the white collar exemptions of the wage and hour law. It is now being offered to a broad business tax relief bill, needed to avoid additional trade sanctions from other countries. Already, these regulations which were scheduled to be released this month have had numerous legislative ups and down. The Washington Post has the details of the latest fight.

As might be expected in an election year, both political parties are trying to stake out the most advantageous position for the presidential campaign. Unfortunately, both of these issues are extremely complex and can substantially impact employers and thus the economy. Sound bites and sound bite thinking, and are really not the best policy, but for the time being, looks like what we will get.

Comments: Post a Comment

Sunday, March 21, 2004

Illiteracy Not Sufficient To Defeat Arbitration Agreement Under Mississippi Law

Posted 6:48 PM by Michael Fox

This is not an employment decision, but an issue that occasionally arises where an employer requires an arbitration agreement as a condition of employment. Applying Mississippi state law the 5th Circuit overruled a district court's denial of a motion to compel arbitration because the plaintiff was illiterate. Washington Mutual Finance Co. v. Bailey (5th Cir. 3/19/04) [pdf]. Citing an old but still good Mississippi Supreme Court decision, the Court found there could not be two laws of contracts, one for the educated and one for the uneducated. I think most states would take a similar view.

Labels: arbitration

Comments: Post a Comment

Wage & Hour Reminder for Employers With Multiple Facilities

Posted 2:40 PM by Michael Fox

Would have been nice if the Penn Health System could have been reminded earlier as it cost them $250,000 in an agreement with the DOL for overtime wages that had not been paid. According to the story in the Philadelphia Business Journal, the problem was that when employees worked in different facilities, there hours were not combined so that they were not paid for overtime when their hours exceeded 40.

Comments: Post a Comment

The Million Dollar Verdict Returns - $1.13 Million for Sexual Harassment in N.H.

Posted 2:18 PM by Michael Fox

One normally associates Muzak with peace and quiet, more boring than excitement, but according to a former employee at least one manager had more exciting things in mind. Citing instances of sexually provocative remarks, inappropriate touching and sexual advances during a business trip, Kerry Bono, a $200,000 a year salesperson sued Muzak for sexual harassment and retaliation. Following a two week trial, the jury award of $1.13 million is a record for a New Hampshire sexual harassment verdict according to Bono's lawyer who is quoted in the story in the Union Leader.

This is the first million dollar verdict I have seen in awhile, although there is also a report this week end of a R1-million judgment for a sexual harassment case from South Africa. Although assuming my currency conversion is correct that is only $150,150 in US dollars, according to the report it is the first time that the highest court in South Africa has recognized such a claim. Whether it is rands or dollars, these are good reminders to employers what can happen inside a courtroom.

Labels: MDV

Comments: Post a Comment

Ahead of the Statutory Curve - Big Business vs. Sexual Orientation Bias

Posted 2:09 PM by Michael Fox

Although there is no federal prohibition against discrimination on the basis of sexual orientation, 357 of the Fortune 500 companies now have such prohibitions in their equal employment policies according to The Journal News story, Gay workers find greater gains in workplace. Some will see this as support for extending the prohibition to all employers of a certain size, while others will say it shows Congressional action is not needed. Regardless, my guess is that at some point, we will have such legislation.

Comments: Post a Comment

Wednesday, March 17, 2004

Expansion of FMLA and Title VII to Victims of Domestic and Sexual Violence Up For Vote Next Week

Posted 5:02 PM by Michael Fox

Back to the sausage grinder of politics in a presidential election year. Next week the Senate has agreed to take up a bill greatly desired by the pro-life movement. Although it has passed the House on several occasions, including this session, it has never been voted on in the Senate. See the story at LifeNews for some of the history on that legislation.

The key for employers however is that two amendments are to be offered, including one by Senator Patty Murray from Washington, known as the "Paul and Sheila Wellstone Domestic Violence Prevention Act," named for the late Minnesota Senator and his wife, who with others perished in a plane accident. A copy of the text of the amendment and an analysis of its impact can be found on the Working For the Future website, the home of the coalition trying to reform the FMLA. Rather than doing that, the coalition is now faced with fighting what is going to be a very difficult political vote in this election year.

Although domestic violence is certainly a problem and one that does need to be addressed by both the employer community and Congress it should be done in a much more organized fashion than passing a complex, expansive bill in the middle of an election year. The legislation would cover victims of sexual and domestic violence, which is defined to include "an individual who has been a victim of domestic or sexual violence and an individual whose family or household member has been a victim of domestic or sexual violence." Those protected would be entitled to Title VII type protection against discrimination, FMLA type leave and a liberalization of requirements for unemployment.

Normally, such an expansive piece of legislation would be subject to much more scrutiny which would allow potential problems to be surfaced, negotiated and compromised. But in the world of partisan politics as played, particularly in an election year, this will apparently be an up or down vote, with no amendments to Senator Murray's amendment being permitted. That may ultimately be its downfall as one need look no further than the definition of those covered to see if Congress passes the bill in this form it will almost certainly be extending these new protections to individuals who commit domestic violence since in a large number of cases, they will be an "individual whose family or household member has been a victim of domestic or sexual violence."

This is too important an issue to be rushed through in such a manner. It might be wise for employers to make sure that their Senators understand their position on this bill.

Labels: FMLA

Comments: Post a Comment

Tuesday, March 16, 2004

Arbitrator Has No Power To Compel Pre-Hearing Production of Documents By 3rd Party

Posted 10:03 PM by Michael Fox

In what it found to be a straight forward case of statutory interpretation, the 3rd Circuit holds that the Federal Arbitration Act does not grant an arbitration panel the right to issue pre-hearing subpoenas for documents to a 3rd party. Hay Group, Inc. v. EBS Acquisition Corp. (3rd Cir. 3/12/04) [pdf]. In so holding, the Court noted it was differing with the 8th Circuit which had held that such power existed and the 4th Circuit which held that such power existed where a "special need" is found. All is not lost for the party needing the documents however as Judge Cherthoff in his concurrence outlined a way to obtain the documents within the confines of the FAA:

Under section 7 of the Federal Arbitration Act, arbitrators have the power to compel a third-party witness to appear with documents before a single arbitrator, who can then adjourn the proceedings. This gives the arbitration panel the effective ability to require delivery of documents from a third-party in advance, notwithstanding the limitations of section 7 of the FAA. In many instances, of course, the inconvenience of making such a personal appearance may well prompt the witness to deliver the documents and waive presence.

Any guess what the next step will be?

Labels: arbitration

Comments: Post a Comment

Doffing & Donning, Walking & Waiting - A Hit At the Chicken Plant

Posted 9:42 PM by Michael Fox

While it almost sounds like a '50s rock and roll tune, it really is central language from a modern day appellate court dealing with the Portal to Portal Act, a substantive amendment to the Fair Labor Standards Act. In Tum v. Barber Foods, Inc. (1st Cir. 1/10/04) [pdf], the 1st Circuit after granting plaintiffs' motion to reconsider and the supporting amicus brief filed by the Secretary of Labor, still affirmed a lower court judgment in favor of the employer.

This case deals with taking on and off protective equipment required by the employer or by governmental standard. Here while finding the "doffing and donning" was integral to the work, the jury also found that the time spent (which it found in minutes and seconds) was also de minimis. The second part was the court's rejection of the plaintiffs' and Secretary's argument that the time spent waiting for the issuance of equipment and the walking after the equipment was issued, or required equpment donned should also be counted. The Court, including a concurring opinion laying out the history of the Portal to Portal Act, said no. Although these cases don't arise often, in the industries where they do the liability can be substantial. This is both a solid win for the employer and a good place to gain an overview on a complex niche of the wage and hour law.

Comments: Post a Comment

Back To Work - With An Interesting Commentary On the Why of the Jobless Recovery

Posted 11:15 AM by Michael Fox

After a few days at the Hacienda de los Santos, a truly wondrous place for a few days of rest and relaxation, I now have a mountain of email and other work to plow through. But in my beginning scanning I happened on a great quote in Janell Grenier's Benefits Blog from a column in Sunday's Philadelphia Inquirer discussing the reasons for the uneasy foundation for the relationship between employers and employees. The comment that caught my eye:

Here's a news flash: Employers don't really want to pay for your kid's orthodontia. They don't like the hassle of setting up and funding your retirement plan, and they'd just as soon not live with the worry that you'll leave crumbs in the computer, spill company secrets to a competitor, or sue over some infraction of the labor laws.

The article provides great food for thought, including the statement, "there ought to be ways we can make employment a less entangling commitment, without compromising workers' welfare." Unlikely, but certainly thought provoking, especially for those of us who in large part owe our living to the entanglement.

Comments: Post a Comment

Wednesday, March 10, 2004

Blogging Siesta Oncoming

Posted 12:08 PM by Michael Fox

Blogging will be slim to non-existent for a few days as I will be traveling to and in Alamos, Mexico for the next several days. I don't know much about the location except it is known as one of the Colonial Gems of the Sierra Madres and the bar at the hotel where we are staying has more than 400 different kind of tequilas. Need I say more.

Comments: Post a Comment

Don't Lose Your Favorite TV Anchor To A Non-Compete

Posted 11:46 AM by Michael Fox

That would seem to be the idea behind a bill working its way through the Kentucky legislature. The Lexington Herald Leader story reports on HB 677, which would preclude covenants not to compete for broadcast employees. The bill passed the committee and now goes onto the full house. Interesting approach to single out one particular profession. Texas of course has done that with its non-compete statute, where non-competes for physicians are not banned, but must contain a buy-out clause.

Labels: competing employees

Comments: Post a Comment

Tuesday, March 09, 2004

In Its Own Inimitable Way, 7th Cir. Clearly Articulates Notice Requirement for FMLA Leave

Posted 5:21 PM by Michael Fox

An employee who merely asked to be home with his pregnant wife, ultimately was terminated. The dispute was over whether he had invoked his right to an FMLA leave. In question was what the court noted was the quid pro quo for the difficulty caused the employer by unscheduled leaves, a requirement that notice be provided 30 days in advance when possible, or if 30 days notice is impossible, as soon as is practicable. In Aubochon v. Knauf Fiberglass, Gmbh (7th Cir. 3/8/04) [pdf] Judge Posner made clear what the case was about:

So that the scope of our holding is clear, we emphasize that the employee’s duty is merely to place the employer on notice of a probable basis for FMLA leave. He doesn’t have to write a brief demonstrating a legal entitlement. He just has to give the employer enough information to establish probable cause, as it were, to believe that he is entitled to FMLA leave. That is enough to trigger the employer’s duty to request such additional information from the employee’s doctor or some other reputable source as may be necessary to confirm the employee’s entitlement. 29 C.F.R. §§ 825.302(c), .303(b), .305(d); Cavin v. Honda of America Manufacturing, Inc., 346 F.3d 713, 723-24 (6th Cir. 2003). The note from Mrs. Aubuchon’s obstetrician indicating that she was having “complications” would have sufficed, despite the absence of details, had Aubuchon submitted it to Knauf before the company acted on his request for leave.

And when an employee doesn't meet that minimal straight forward test, and is absent more than allowed by the employer's rules, his termination is proper. It matters not, that with proper notice there might have been an entitlement to the leave.

Labels: FMLA

Comments: Post a Comment

2 Week Error - Maybe $700,000 Worth, Or Why You Need A Good Immigration Lawyer

Posted 10:28 AM by Michael Fox

Especially now where rules are no doubt more carefully scrutinized as immigration, outsourcing and homeland security are a potent and powerful combination. Just how complicated, and potentially expensive an immigration screw up can be is seen in this story from the El Paso Times on the possible consequences of hiring a group of Filipino teachers 2 weeks early.

Comments: Post a Comment

FY 2003 at the EEOC - A Statistical Look

Posted 10:01 AM by Michael Fox

Check out the EEOC's press release detailing charges and enforcement actions for the government fiscal year that ended 9/30/03. Here is the summary of charges filed, with the percentage being of the total number of charges filed:

RACE 28,526 35.1%
SEX/GENDER 24,362 30%
RETALIATION 22,690 27.9%
AGE 19,124 23.5%
DISABILITY 15,377 18.9%
NATIONAL ORIGIN 8,450 10.4%
RELIGION 2,532 3.1%
EQUAL PAY 1,167 1.4%

Of interest, retaliation is approaching the percentage of the largest substantive discrimination claims and the relatively small portion of charges based on religion, notwithstanding increased attention to that issue in the last few years.

Labels: EEOC

Comments: Post a Comment

Monday, March 08, 2004

Employers With Multiple Locations Dodge A Bullet On Benefit Plans Courtesy of the 1st Cir.

Posted 6:31 PM by Michael Fox

A well written brief can make an impression on a court, and you definitely get the opinion that occurred from today's decision in Candelaria-Ramos v. Baxter Healthcare Corp. of Puerto Rico, Inc. (1st Cir. 3/8/04) [pdf]. The basic argument was that when Baxter adopted a change to its pension plan that made it more advantageous for longer serving employees to retire, it discriminated against its Puerto Rican employees because it did not adopt the same version for its Puerto Rican operation. The Court carefully considers the plaintiffs' counsel's argument that there was at least a fact question on the issue of intentional discrimination, and you can tell is impressed by the argument made by counsel. Ultimately however, it disagrees and upholds the district court's grant of summary judgment. Part of its basis is an example of the common sense knowledge that it is so important that courts possess and use. To the allegation that Baxter had not presented accurate documentation of certain internal meetings, the Court noted:

anyone familiar with corporate decision-making culture would not be surprised that the remnants would be nothing more than agendas, scattered references in summaries and minutes, and a few memories secured by depositions.

Perhaps even more importantly, the Court refused to apply a disparate impact analysis, finding it precluded by the wording of Title VII itself:

It is true that disparate impact liability can be imposed regardless of whether an employer possesses an intent to discriminate, Watson v. Fort Worth Bank & Trust, 487 U.S. 977, 987 (1988), but Title VII also says:

Notwithstanding any other provision of this subchapter, it shall not be an unlawful employment practice for an employer to apply different standards of compensation, or different terms, conditions, or privileges of employment pursuant to a bona fide seniority system . . . or to employees who work in different locations, provided that such differences are not the result of an intention to discriminate because of race, color, religion, sex, or national origin. 42 U.S.C. § 2000e-2(h) (2000) (emphasis added).

In other words, different treatment in different locations is permissible absent an intent to discriminate.

Absent that finding, employers with multiple locations could easily have found themselves having to frequently justify differing pay and benefit plans against not only claims of intentional discrimination, but the much more difficult and time consuming claims of disparate impact.

Comments: Post a Comment

Thinking of Leaving Your Job Soon - Some Good Advice

Posted 12:46 PM by Michael Fox

Don't. Well actually that's not the advice, but given all the negative talk about job loss and failure to create new jobs would seem to make some sense. But, more realistically as the market does improve there is probably a lot of built up movement about to take place. If you are part of it, this article from the Cincinnati Enquirer has some common sense advice on steps to take when it is time to move on.

Comments: Post a Comment

Saturday, March 06, 2004

Standard for Suing A Union Officer Addressed By 5th Circuit

Posted 12:53 PM by Michael Fox

When a Southwest Pilot and member of the Southwest Airline Pilots Union sought to sue three of the officers of the union for breach of fiduciary duties under Title V of the Labor Management Reporting and Disclosure Act, 29 U.S.C. §501(a), the Court had to address for the first time what must be shown to meet the pre-requisite "good cause" requirement contained in §501(b). Hoffman vs. Kramer (5th Cir. 3/5/04) [pdf]. (Totally unrelated to Kramer v. Kramer, starring Dustin Hoffman.)

The Court established the following five point test for satisfying the good cause requirement:

To sum up, the substance of the “good cause” requirement of §501(b) requires a few essential steps for district courts to take beyond Rule 12(b)(6) in evaluating applications for leave to sue union officials. First, the court must determine that the alleged misconduct directly relates to the duties enumerated in § 501(a). Second, because of the derivative nature of an applicant’s suit, the court must satisfy itself that the applicant seeks remedies that would realistically benefit the union as the collective bargaining representative of its members and/or the membership of the union. Third, the application must allege facts that will support a conclusion that the alleged breaches of § 501 were presented to the union. Fourth, the applicant must make a showing that the union’s refusal to act on the breaches presented to it was objectively unreasonable in the ways we have earlier discussed. Finally, after the court is satisfied that these conditions are met, the plaintiff must convince the court by the allegations of the verified application, or affidavit or otherwise, that some evidence exists, disputed or not, that will support the claims of a breach of fiduciary duty under § 501(a).

Having set out the requirements, the Court then concludes that they are not met in this case.

Comments: Post a Comment

5th Cir. Answers Some Arbitration Questions in FLSA Context

Posted 12:36 PM by Michael Fox

The pro-arbitration stance of courts continues as the 5th Circuit affirms a lower court's upholding of a challenged arbitration program. Carter v. Countrywide Credit Industries, Inc. (5th Cir. 3/5/04) [pdf]. In doing so they answered some open questions about arbitration programs, although unfortunately, they did not always cite the exact terms of the plan.

First they rejected the argument that the agreement was not enforceable because it precluded them from bringing a class action. Relying on Gilmer, an age discrimination case, which means it has the same class action provision as the FLSA, the court nixed this argument. After the Supreme Court's decision in Bazzle last term, discussed here, most thought that it implied that employers would have the power to bar class actions, and this confirms it in the 5th Circuit at least under the FLSA and the ADEA. Secondly, it rejected the argument of plaintiffs that the restricted discovery was unconscionable. Again their source was Gilmer. Although not citing what the restrictions were the court held the burden was on the plaintiffs to demonstrate that the discovery provisions “will prove insufficient to allow claimants . . . a fair opportunity to present their claims.” A forum selection provision that required the hearing in the district where they worked was found reasonable, at least for these particular plaintiffs.

The court also affirmed the lower court's severance of a fee splitting procedure, although doing so on slightly different grounds. The 5th Circuit found that the unilateral offer of the company to pay all but a $125 filing fee was sufficient to moot the issue, since these plaintiffs would not be able to make the individualized showing required by the Supreme Court that the fees would be so onerous as to prohibit them from pursuing the arbitration.

All in all, yet another strong affirmation that reasonable arbitration programs will be upheld.

Labels: arbitration

Comments: Post a Comment

Friday, March 05, 2004

"Utterly Baseless" Charge of Discrimination Not Protected Activity Even Under the Participation Clause

Posted 8:12 AM by Michael Fox

Students of the law of retaliation know that there are two kinds of protected activity under Title VII (and some other statutes). Under the "opposition cause" an employee is protected merely for voicing his opposition to a prohibited practice, even if that opposition is never raised as part of a formal charge. By contrast the "participation clause" protects employees who file a charge of discrimination, or somehow participate in the process of a formal charge as by testifying, providing evidence etc. As a general rule, there has always been more protection afforded "participation" than "opposition," in order to encourage employees to feel free from retaliation when they file a charge. In Matson v. Caterpillar (7th Cir. 3/4/04) [pdf] the 7th Circuit ventures further than any other federal appeals court has gone in holding that filing a formal charge of discrimination, if it is "utterly baseless", is not protected activity. Thus Mattson's termination because he filed a charge with the EEOC and the state agency could not be the basis for a successful claim of retaliation.

Before employers go overboard with what really is a rather remarkable ruling, the Court itself cautions:

We emphasize that this decision sets a low bar for receiving Title VII protection. Protection is not lost simply because an employee is mistaken on the merits of his or her charge. Protection also is not lost if an employee drafts a complaint as best he or she can but does not state an effective legal claim. Cf. Sias v. City Demonstration Agency, 588 F.2d 692, 695 (9th Cir. 1978) (expressing concern that if protection turns on the merits of an employee’s claim, participation under Title VII “would be severely chilled”); Pettway v. American Cast Iron Pipe Co., 411 F.2d 998, 1005 (5th Cir. 1969) (explaining that the participation clause must offer broad protection because individuals draft charges as best they can “without expert legal advice” in challenging “huge industrial employer[s] in this modern day David and Goliath confrontation”). However, the unique circumstances of this case present us with a complaint that is not only unreasonable and meritless, but also motivated by bad faith. Against this factual backdrop, we find that Mattson’s claim is not deserving of protection under the participation clause of Title VII. The paucity of case law on point illustrates the rarity of such claims as well as the limited nature of our holding.

The facts of the case back it up. Matson, an electrician, first filed an internal complaint against his female supervisor that on one occasion when she stood close to him (required because of the environment where they worked) her breast brushed against his arm and one time she reached around him to get a clipboard. In the internal investigation he admitted that he did not think that she was attracted to him and that the contact might have been inadvertent. The investigator concluded that there was no merit to the charge and he was warned that filing false charges of harassment could lead to discipline including termination. (The supervisor was also cautioned to be careful in how close she stood to people.)

Notwithstanding the warning, 3 months later Mattson filed a charge with the EEOC and the Illinois agency, based on these same facts. Still he was not terminated until a co-employee provided the following information:

Hollis submitted a signed affidavit in which he stated that Cone’s breast did not touch Mattson. Hollis further stated that Mattson had told him that Mattson’s goal was to get Cone “out of here any way possible.”

Although an important, and certainly intellectually honest, not to mention correct, decision, it is extremely limited.

Labels: retaliation

Comments: Post a Comment

Thursday, March 04, 2004

Follow Up From Yesterday - Link to the Proposed Rule on Definition of Applicant

Posted 11:54 AM by Michael Fox

Here is the post in today's federal register, FR Doc 04-4090. The agencies involved are soliciting written comments on the proposal prior to May 3, 2004.

Comments: Post a Comment

Wednesday, March 03, 2004

A Primer on "At Will" Employment

Posted 1:59 PM by Michael Fox

For anyone who has been confused why if employees are at will, there are so many employment lawsuits, here is a good primer, with a California slant, from the East Bay Business Times.

Comments: Post a Comment

$1.4 Million Award - Arbitration Can Sometimes Be Painful

Posted 1:51 PM by Michael Fox

Although judging from the comment of the losing CEO, "The arbitrator’s award was about what we anticipated. We’re glad it’s over, and we continue to focus on providing our clients the best brokerage, management and e-mail services available in the list industry," maybe it was not all that bad. Still you wonder if it wasn't just putting a good face on it. Where arbitration is final and binding, what else can you do? See the story in the trade paper, Direct Marketing News.

Labels: MDV

Comments: Post a Comment

A Health Care Provider's Nightmare - Woman's Health Info Shows Up In Custody Dispute

Posted 1:39 PM by Michael Fox

Fellow Texan and blogger, Jeanne Pi has a report of a situation that strikes fear into the heart of every health care employer (and I speak from experience, their lawyers), the employee who abuses their position of trust to delve into the medical records of someone else. You can check out the post here. In reality it does not happen all that often, but when it does by the time you find out, one can almost never put the genie back in the bottle.

Comments: Post a Comment

Federal Arbitration Act Does Not Confer Jurisdiction - Not To Compel or Vacate

Posted 1:02 PM by Michael Fox

So says the 5th Circuit in Smith v. Rush Retail Centers, Inc. (5th Cir. 3/3/04) [pdf]. The Court notes that they are only acting consistent with the concept of a court of limited jurisdiction, and are joining:

The Second, Sixth, Seventh, Ninth, Eleventh, and District of Columbia Circuits [which] have held that § 10 of the FAA does not confer federal jurisdiction and that there must be an independent basis for federal jurisdiction before a district court may entertain a petition to vacate an arbitration award.

Although in the past the jurisprudence surrounding arbitration was somewhat arcane, it is becoming more mainstream. Here, the defendant didn't challenge jurisdiction, but the magistrate did. Find diversity (and $75,000 in controversy, see 9th Circuit view on that here), a federal question, or go to state court.

Labels: arbitration

Comments: Post a Comment

3 Years In the Making - Who is an Applicant?

Posted 12:39 PM by Michael Fox

Coming tomorrow to the Federal Register nearest you will be the long awaited proposed regulation defining an applicant for many job related purposes. SHRM is happy with the general approach according to their press release. The overview from SHRM on the critical issue of communications received via the Internet:

The proposed regulations suggest three criteria for an individual using the Internet for job seeking purposes to be considered an "applicant": the employer has acted to fill a particular position, the individual has followed the employer's standard procedures for submitting applications, and the individual has indicated an interest in the particular position.

If you subscribe to the BNA's Daily Labor Report you can get a look at the regulation in today's edition.

Comments: Post a Comment

Tuesday, March 02, 2004

Rule 68 Offers of Judgment - Attorneys Fees Included Under Title VII, And State Law As Well

Posted 7:58 PM by Michael Fox

After a suit was filed raising claims under Title VII and the NYC ordinance prohibiting discrimination, the defendant extended a Rule 68 offer of judgment for $15,000 "inclusive of all costs available under all local, state or federal statutes accrued to date." Plaintiff accepted and then his counsel immediately sought $35,000 plus in attorneys' fees. The district court found that under Title VII attorneys' fees are part of costs so that they were covered by the $15,000. However, the definition under the New York statute was different, so the court awarded $17,000 under that statute. Wrong said the appellate court. Wilson v. Nomura Securities International, Inc. (2nd Cir. 3/2/04) [pdf]. Since the work for all the claims was truly indivisble, it was not appropriate to award separate attorneys' fees since they were compensated for in the original offer. It was not all good news for defense counsel however, as the dissent was somewhat less than charitable:

[T]he Court deems the parties to have settled the Plaintiff's claim for attorney's fees under municipal law by agreeing to a payment "inclusive of costs." Because that ruling imports into the word "costs" a meaning that it does not have under applicable municipal law and unjustifiably rewards the Defendants for their counsel's inattention to careful drafting, I respectfully dissent.

Ouch!

Labels: attorneys fees

Comments: Post a Comment

Putting A Personal Touch On A Soldier Returning Home

Posted 3:16 PM by Michael Fox

Those returning from serving in National Guard or other reserve units are protected by USERRA and often times from an employment lawyer's perspective, that's what we think about. Today's article from Captain Jason Thorne of the Indiana Army National Guard and soon to be returning to Reilly Industries, Inc. in Indianapolis, puts a personal touch on the issues citizen soldiers face in transitioning from one role to another. The WSJ article is a good one, Back to the 'Day Job': A Reservist Reflects. And a good reminder for all of us.

Comments: Post a Comment

NY, LA, ID and TN Employers On Notice - National Guard Call Up May Impact You

Posted 12:47 PM by Michael Fox

TalkLeft: 18,000 More National Guard Called Up for Iraq has the Washington Post story on the call up of 18,000 National Guard troops from these four states.

Comments: Post a Comment

Monday, March 01, 2004

More On References, Or Rather, the Lack Thereof

Posted 1:51 PM by Michael Fox

The Christian Science Monitor article, Would you hire this man? uses Charles Cullen, a New Jersey nurse who has admitted killing 40 people, as the poster boy for the problems that occur because of company policies (based on lawyers' advice) to give only neutral information. Although there is a legitimate point to be made about the hindrance to the flow of information, there is also a danger that if you are the employer who chooses to give out negative information, you dramatically increase the chances of a lawsuit. And it is not just defamation, there is also the exposure for retaliation claims if the employee engaged in any protected activity, such as filing a charge of discrimination.

In many ways, the situation reminds one of the the philosophical problem of "the commons," where each herdsman grazing cattle on a common pasture has incentive to act in a selfish way, even though when all do it hurts the common good. When each employer remains mute, they act in their own best interest, notwithstanding that the employer community as a whole may suffer from a lack of good information.

Comments: Post a Comment

California Decision Making It All or Nothing For Arbitration Raises Concerns

Posted 8:49 AM by Michael Fox

Although it was not the first decision in California to raise the possibility, an intermediate appellate court's ruling that an employer who attempts to reserve to itself the right to take certain actions to court, usually trade secret or competition related, may void the entire arbitration agreement is getting a lot of attention, including this story [subscription required] from the East Bay Times. The case is Abramson v. Juniper Networks (CA - 6th App. Dist. 2/6/04) [pdf].

Labels: arbitration

Comments: Post a Comment

Home