I. ADEA

Dumb & Dumber. Dumb & Dumber. Take note: You, too, can learn a lot from a dummy.

In January of 2002, a company kicked off a series of dumb employment decisions when it took work station chairs from three employees, whose ages ranged from early to mid-50s, and forced them to stand for eight hours daily while allowing younger, similarly-situated employees to sit to perform their jobs. Even after the company was presented with letters from the employees' doctors, advising the company to return the original work chairs to the employees because of the pain they were experiencing from standing, the company still refused to give the chairs back. After several weeks of refusing to return the chairs, the company gave the older employees, as replacements, high stools with minimum padding and no leg, back or arm supports. This dumb decision triggered the employees to retrieve their original work chairs from the storage room. However, once the company discovered that the employees were using their old work chairs, the company removed the chairs a second time and gave them to the younger employees to use–the dumbest move of all.

As you could have guessed, this half-baked scheme to get rid of the older workers backfired against the company. The employees, each of them having worked for the company and its predecessor for more than 30 years, filed an age discrimination lawsuit against the company in federal court. The company sought the dismissal of the employees' claim by arguing that the employees did not sufficiently allege a discrimination claim, because the "allegedly discriminatory act"–the removal of stools–did not constitute an adverse employment action.

The district court did recognize that generally, adverse employment actions involve significant economic or responsibility-altering impact, like failing to promote, hiring, firing, reassignment or reducing an employee's pay or benefits. However, the district court opined that "working in the face of unnecessary physical pain and injury most certainly puts one at a material disadvantage in any employment situation." Accordingly, the court held that the employees' claims of changed working conditions, which caused them pain or injury, may constitute an adverse employment action and therefore, the employees could proceed with their claim of age discrimination.

As you can see, relatively "small" employment decisions, which seem genius in theory, may really be dumb when put into practice. Furthermore, they have the potential of being unlawful and quite costly. Thus, the morale of the story is: don't be a dummy!

FYI. As of January 16, 2004, a new regulation concerning the rights of charging parties under the Age Discrimination in Employment Act (ADEA) went into effect. The Equal Employment Opportunity Commission (EEOC) issued a new regulation, which states that complainants can file private lawsuits on pending age discrimination complaints 60 days after filing charges with the EEOC regard-less of the EEOC's progress in processing their cases. As a result, an employee does not need to wait for the EEOC's notice of dismissal of the charge before proceeding with a private civil suit.

II. FLSA

Changes Are Ahead. If you haven't heard already, on April 20, the Department of Labor issued the long-awaited changes to the Fair Labor Standards Act (FLSA) regulations. These new regulations revise both the salary and duties tests used to determine who is entitled to overtime under the law.

The new rules increase the earnings requirement, mandating overtime for employees earning less than $455 a week or $23,660 annually. Furthermore, the regulations clearly state that "blue collar" workers and certain occupational groups, such as police, firefighters and other public safety "first responders" are entitled to overtime.

The new rules replace what is commonly known as the "long and short duties" tests with a "standards duties" test to determine whether employees earning between $23,660 and $100,000 are exempt from the FLSA overtime requirements. The final rules also contain a separate test to determine whether highly paid employees–those earning more than $100,000–are entitled to overtime, despite their compensation level.

Also of great significance, the final regulations permit employers to dock the pay of salaried employees on daily intervals, instead of weekly intervals, for violating company rules without risking the employees' exempt status. However, discipline for violating company rules, such as sexual harassment, drug/alcohol, and violence policies, must be imposed pursuant to a written policy applicable to all employees.

Assuming Congress does not act in a way that would change or hinder its implementation, the DOL's final version will go into effect on August 23, 2004.

Be Warned – You Are A Target For Plaintiff's Lawyers. With workers' compensation, tort and medical malpractice reform eating into the Plaintiff's lawyers' income stream, some of our distinguished brethren are altering course to try to recoup some lost earnings by bringing lawsuits against employers for alleged overtime and minimum wage violations. Sometimes it is a disgruntled employee or former employee who initiates the suit, but more often than not the attorneys attempt to bring collective action suits in which a large group of employees who are subject to the same corporate wide policy are grouped together in a special kind of class action. One was filed recently against a multi-branched bank in Texas. The allegations were that the employer knew the employees were actually starting to work before their assigned starting time (doing such things as making coffee or answering the phone) but the employer did not pay the employees for such time. But the even more risky ones involve suits challenging whether certain salaried employees are actually exempt from overtime. Such cases involve: managers at fast food restaurants who spend a lot of their time working side by side with the other employees (even where such managers have authority to hire, fire, order the food, handle the funds, etc.); store managers at nationwide stores (who spend much of their time selling to customers rather than handling their subordinates); bank officers (who do not have two full time employees reporting to them and have limitations on their authority to make loans). These type cases will increase with the new regulations substantially upping the minimum salary requirement and tightening up a little bit on the required duties for each of the white collar exemptions. You may need to have a check-up to see if you can survive the coming attack.

III. ADA

The Postmaster Sends Itself To Court. Off to court the United States Postal Service must go, since the Sixth Circuit found that a genuine fact issue existed as to whether it failed to reasonably accommodate an employee's disability and whether its alleged failure could have lead to the employee's resignation. When the employer was informed that an employee's doctor restricted her to work eight hours per day, 40 hours a week, because of her rheumatoid arthritis, the employer made the accommodations. However, upon assuming a supervisory position, the employee was allegedly told by the employer that her medical accommodation would no longer apply. In her new position, the employee was forced to work long stretches of over 40-hour weeks with few or no days off. The employee requested that she be allowed to delegate certain job duties that prolonged her work hours. The employer allegedly denied this request despite having allowed her predecessor to delegate the same responsibilities to a subordinate employee. Eventually, the demands of her job caused the employee pain and exhaustion and consequently, she resigned.

The employee sued her employer, claiming that she had been discriminated because of her disability when the employer failed to reasonably accommodate her disability, in violation of the Rehabilitation Act (which applies to federal government employees). The employee also argued that her voluntary resignation was an adverse employment action, as it constituted a constructive discharge. For an employee's termination of employment to be determined a constructive discharge by a court, the working conditions must be so difficult or unpleasant that a reasonable person in the employee's shoes would have felt compelled to resign. The lower court dismissed the employee's claim, finding the employee did not suffer an adverse employment action because her working conditions would not have forced a reasonable person to resign.

However, the Sixth Circuit disagreed. It determined that a reasonable jury could conclude that the employer "could foresee that [the employee] would be compelled to quit her job in order to preserve her health" since it "knowingly and deliberately turned its back" on her. Additionally, the court rejected the employer's reasoning that it refused the employee's request to delegate duties because she was aware of the job requirements before accepting the position. It stated: "a qualified individual with a disability does not waive her right to an accommodation in the form of a modification of job duties simply by being apprised of the job duties before she commences work…[if so], it is difficult to see how a disabled individual ever would be entitled to a reasonable accommodation, since people are usually aware of what their duties will be before they start a job."

Even though this case was brought under the Rehabilitation Act, it is equally applicable to situations triggering your duties under the Americans with Disabilities Act (ADA). Thus, when a disabled employee is promoted, the duty to make reasonable accommodation continues. Failure to reasonably accommodate a disability, as you can see, may ultimately send the employee packing, which in turn, may send you to the courtroom.

IV. TITLE VII

Show Me The Money. In 2000, certain Houston employees filed a lawsuit against their employer under Title VII of the Civil Rights Act of 1964 and 42 U.S.C. Section 1981, alleging it discriminated against them on the basis of their race. One of their claims was that they were denied promotions and pay increases because they were Black. On appeal, the Fifth Circuit reversed the district court's dismissal, finding that in making its decision the district court ignored the employer's "Balanced Workforce Initiative" or "BWF" – a program implemented in the 1990s to insure that all racial and gender groups were proportionately represented at all levels of the company. The Fifth Circuit found that the employer's affirmative action program alone "was sufficient to constitute direct evidence of a form or practice of racial discrimination."

To achieve a "racially balanced" workforce, the employer produced reports listing the actual and desired racial compositions of each office. The reports indicated that Blacks were overly represented and Whites were under represented in the employer's Houston office. Therefore, the general manager in the Houston office directed the Houston office to create its own BWF reports to remedy the disproportionate racial representation. The Houston BWF reports were quite explicit in their racial goals for each job and grade level. Furthermore, notes and evaluations made by the employer's senior staff indicated that managers were evaluated on how well they complied with the BWF objectives. The employees also presented statistical data showing the employer subsequently reduced the percentage of Black employees in the Houston office. In light of this evidence, the Fifth Circuit concluded that a "reasonable jury could find that the employer considered race in fashioning its employment policies and that because the plaintiffs were Black, their employment opportunities were limited."

Achieving workplace diversity is often times a balancing act. Therefore, when instituting affirmative action policies or complying with already existing policies, it is necessary for employers to ensure that these policies are in compliance with the law and to seek legal advice, because compelling adherence to an affirmative action goal could lead to potential liability.

Keep Your Hands To Yourself. To put it simply, don't hit an employee. Sounds really easy not to do, right? But unfortunately, these things happen in the workplace. As a matter of fact, the Supreme Court of Iowa was presented recently with a situation where a restaurant supervisor hit an employee, which resulted in the employee's death. The restaurant supervisor and the employee had become friends. Angry and upset with the employee for telling management that he had an affair with a female employee, the supervisor decided the only way the employee could regain his trust was to take a chest shot. The employee agreed to take the chest shot and the supervisor punched him. Sadly, the employee suffered a cardiac arrhythmia, collapsed, and died. The employee's estate sued the employer for retaliation in violation of Title VII. The estate characterized the chest shot as retaliation for reporting the supervisor's harassment of an employee. The Supreme Court of Iowa agreed, holding that the chest shot could be construed as an adverse employment action attributable to the employer.

Accommodate Religiously. Like many companies, an employer included in its handbook a "Diversity Policy," which outlined the company's philosophy and goals regarding diversity in the workplace, and a "Certificate of Understanding" all employees were required to sign, acknowledging their agreement and compliance with the Diversity Policy. One employee, a devout Christian, brought to his supervisor's attention that his religious beliefs would not allow him to adhere to one sentence in the policy, which read: "Each person…is charged with the responsibility to fully recognize, respect and value the differences among all of us." The employee also wrote a letter to the human resources (HR) manager, explaining that he was fully prepared to comply with the underlying principles of the Diversity Policy. But, because the Bible deemed some behavior and beliefs as sinful, he could not value such behavior or beliefs without compromising his own beliefs. Accordingly, he could not sign the Certificate of Understanding, agreeing to abide by the challenged language, if it literally required him to value a particular belief or behavior the Bible deemed sinful.

The HR manager, employee, and his supervisor met to discuss the employee's inability to sign the Certificate. During the meeting, the HR manager and supervisor explained to the employee the importance of the Diversity Policy and that in order to keep his job he had to sign the Certificate. But, at no time during the meeting, did they discuss the meaning of the problematic language or what obligations, if any, it imposed on the employees. Nor did the HR manager gather any information about the employee's concerns regarding the challenged language. Even when the employee attempted to discuss how the language would apply to his beliefs regarding "neo-Nazi skinheads," the HR manager refused to engage in the discussion, characterizing it as a "philosophical debate." The employee again told the HR manager that without further clarification of the language, he would not be able to sign the Certificate. The HR manager refused to clarify the challenged language and refused the employee's request to figure out a way to work around the challenged language. The employee then declined to sign the Certificate and the HR manager terminated the employee immediately thereafter.

The employee filed a religious discrimination claim under Title VII, alleging that the employer discriminated against him on account of his religious beliefs. The court ruled in the employee's favor, awarding him over $200,000 in compensatory and emotional distress damages because the employer made no effort to accommodate reasonably the employee's religious beliefs. Title VII mandates an employer to reasonably accommodate an employee's religious beliefs unless the proposed accommodations would cause the employer an undue hardship. The court even noted that had the employer taken the time to explain the policy and its obligations, or figure out exactly the employee's concerns, the two parties could have probably reached common ground without having to change the policy language. The court did not explain how enforcement of a policy statement, which does not violate the religious protections of Title VII, would be a violation of Title VII itself.

V. ARBITRATION

The Arbitrator Must Have Overslept Too. An arbitrator recently reinstated an employee who violated the company's attendance policy when she failed to arrive to work on time because she overslept. The arbitrator ruled that the company should have allowed the 20 minutes she was late as FMLA protected leave because she had been taking care of her sick mother a portion of the night before. Amazingly, the arbitrator ruled "oversleeping is a qualified event when it is directly tied to the grievant's status as a protected care-giver."

As do many, the company had an attendance policy that required employees to contact their supervisors at least one hour before their shift if they were going to miss work. The grievant failed to follow the company's attendance policy, as she called merely 10 minutes before her shift. Moreover, when she called she simply told her supervisor she would miss the start of her shift because she overslept. Because she stated that her tardiness was a result of oversleeping, the company counted her tardiness as an "occurrence" under its policy. Given that occurrence exceeded her allotted occurrences for the year, her employment was terminated. Shortly after her termination, the employee explained that she overslept because of the exhaustion she experienced taking care of her sick mother the previous evening. Nevertheless, the termination stood.

Despite the undisputed fact that the attendance policy was applied fairly and evenhandedly, the arbitrator woke up the company by ruling that the time the grievant was tardy should have been designated FMLA leave. He explained that since the grievant was her mother's designated caregiver, any time spent caring for her mother was a qualifying event under FMLA. However, the arbitrator skirted the fact that the grievant was not caring for her mother at the time she was supposed to be at work and held that the time spent recovering from her duties as a caregiver was a qualifying event under FMLA. The arbitrator dreamed that FMLA coverage "is for a state of being, a role being served, not the actual act of administering to the patient at all times."

It's OK To Get High On Your Own Time? Recently, Arbitrator Franckiewicz (remember to strike him from your next panel) okayed an employee's recreational use of illegal drugs. An employer had a written Drugs and Alcohol Policy requiring employees on extended leave for more than four weeks to undergo drug and alcohol testing before returning to work. Employees had an option of taking the drug test during the week at the company's facilities or on the weekend at a local healthcare facility. After having been on leave for five or six weeks, the Sunday before he was to return to work, an employee provided the healthcare facility with a specimen for the required drug test. The employee tested positive for marijuana. The employer suspended him for five days and subsequently terminated the employee. However, the arbitrator ruled that the termination was not just even though he found no credible reason why the employee tested positive for marijuana other than the fact that he ingested it.

Apparently, the arbitrator condoned the employee's recreational drug use, stating: "even if an employee on an extended absence does ingest illegal drugs, what an employee does on his own time is his own business, unless that conduct implicates the employment relationship." In light of this rationale, the arbitrator found by not permitting the employee to return to work, the employer did not provide the employee's illegal drug use an opportunity to affect his employment. The arbitrator also noted that even though the employee tested positive on his day off does not necessarily mean that the employee would have tested positive on his scheduled return date (since drugs metabolize over time). Therefore, the arbitrator decided the employee's termination was a tad bit premature and without just cause. The employee was reinstated under one condition: he could not return to active employment until he tested negative for drugs!

VI. NLRA

NLRB Tug O' War.
For almost 30 years, to allow a representative or to not allow a representative has been a constant question before the National Labor Relations Board (NLRB). The NLRB has gone back and forth as to whether non-unionized employees are entitled to have a fellow employee present during investigatory interviews when the employee believes disciplinary action may occur. In 1975, the U.S. Supreme Court determined that unionized employees were entitled to union representation during such investigatory interviews, and, thus, came the birth of what we commonly know as Weingarten rights (based on the name of the case). In 1982, the NLRB extended these same rights to non-unionized employees. Three years later, the NLRB reversed course, holding that non-unionized employees do not have Weingarten rights. Fifteen years later, the NLRB reversed course again, renewing its interest in providing Weingarten rights to non-unionized employees. This year, the NLRB has, once again, changed its mind, holding that non-unionized employees do not possess Weingarten rights. The NLRB noted that non-unionized employees have the right to request coworker representation during investigatory interviews, but the employer is not obligated to grant this request.

Union Organizational Activity Since Our Last Newsletter. Nine petitions for certification have been filed by unions. Two petitions for decertification have been filed by management. Ten elections have been held, of which five have been won by management.

Firm News. Neel & Hooper, P.C. is pleased to announce that Grae Griffin has joined the firm as a new associate. He graduated from the University of Kansas in 1994 and received his law degree from the University of Tennessee in 2001. Grae has been practicing in Atlanta, Georgia for the last three years in the boutique labor/employment law firm of Fisher & Phillips LLP.

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The Quarterly Update is a newsletter providing recent items of interest to our clients in the various areas of employment law. While the Update is to alert you to potential new problem areas or changes in the law, it is not to be considered legal advice or a legal opinion. Such can only be given after careful consideration of the facts unique to any situation. The contents of this newsletter are copyrighted and may not be used without express written consent of Neel & Hooper, P.C.

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