Tuesday, June 30, 2009

GM bankruptcy hints at risks to non-unionized employees

The judge presiding over the General Motors bankruptcy last week denied an application by the General Motors Retirees Association (GMRA) to form a benefits committee that would advocate for the beleaguered car manufacturer's salaried retirees in the bankruptcy proceedings. The company, ruled the judge, had the right, pre-bankruptcy, to modify or terminate the retirees' health and life insurance benefits and the retirees cannot now challenge that right.

"While I do understand the importance of this to the retirees," said U.S. Judge Robert Gerber, "I can't guarantee the retirees rights that they don't have outside of bankruptcy."

But not all the GM retirees have been left to fend for themselves. The hourly retirees who comprise the majority of GM's retirees have been, and continue to be, represented by the United Auto Workers. Those employees will have a voice in the future of the auto company and their benefits; indeed, the UAW is now one of the largest shareholders in the “new” GM. The salaried retirees, who worked as engineers, clerks and project managers, stand to lose two-thirds of their benefits, including the total elimination of dental, vision and long-term disability coverage. These retirees are not guaranteed any input whatsoever and have been forced to turn to Congress for protection.

This ruling raises several issues. Is it just that one group of retirees will disproportionately sacrifice? What, if anything, can Congress do to protect these retirees? Would offering anything beyond basic protections to the retirees only feed the perception among big industry that the government will step in to correct their mistakes? And why would unions not use this as an example in their organizing drives?

Proponents of the Employee Free Choice Act have long argued that employers take extraordinary means to thwart organizing. They further argue that now, more than ever, employees need the strength of a union to protect them. Whatever the reasons for the non-unionized nature of the GMRA retirees, it is indisputable that they are receiving poorer treatment than their unionized counterparts.

Retirees were always going to have to make sacrifices in order for GM to eventually emerge as a profitable company. All retirees will, in fact, experience cuts to their benefits. But the non-unionized retirees will, by far, have the worst of it. To paraphrase George Orwell, all retirees will suffer equally, but some will suffer more equally than others.

Monday, June 29, 2009

Refusal to certify exams in order to avoid race-bias claims was discriminatory, High Court rules

The City of New Haven, Connecticut, violated Title VII when it tossed the results of firefighters’ promotion exams on the premise that certifying the results would lead to disparate impact litigation, ruled the US Supreme Court. The case has been even more closely watched because of the role that Judge Sonia Sotomayor, the Obama Administration’s nominee for the announced Supreme Court vacancy, played in the appeals court’s decision below that upheld the city’s actions. (Ricci v DeStefano, Dkt Nos 07-1428, 08-328, June 29, 2009, to be reported at 92 EPD ¶43,602)

Background. The city refused to certify the exam results when it appeared no black or Hispanic applicants would be eligible for promotion to the rank of Lieutenant and no black applicants and, at most, two Hispanic applicants would be eligible for promotion to the rank of Captain. Expressing a fear of possible litigation from nonpromoted, nonwhite applicants if the results were certified, the city refused to certify the exams and no promotions were made. Eighteen candidates, 17 white and one Hispanic, filed suit under Title VII and other federal and state laws alleging the refusal to certify was racially discriminatory.

A federal district court granted the defendants’ motion for summary judgment, holding the defendants’ motivation to avoid making promotions based on a test with a racially disparate impact, even in a political context, does not, as a matter of law, constitute discriminatory intent, and, therefore, such evidence is insufficient for plaintiffs to prevail on their Title VII claim.”

The Second Circuit Court of Appeals affirmed the decision in an unpublished order that was later withdrawn and replaced with a per curiam opinion (91 EPD ¶43,235) and an order denying a rehearing and rehearing en banc with written concurrences and a dissent (91 EPD ¶43,236). The Supreme Court granted cert on January 9, 2009.

Supreme Court ruling. The High Court noted that under Title VII, before an employer can engage in intentional discrimination for the asserted purpose of avoiding or remedying an unintentional, disparate impact, the employer must have a strong basis in evidence to believe it will be subject to disparate-impact liability if it fails to take the race-conscious, discriminatory action. Here, all the evidence showed the city rejected the test results because the higher scoring candidates were white, wrote the Court. “Whatever the city’s ultimate aim – however well intentioned or benevolent it might have seemed – the city made its employment decision because of race. The city rejected the test results solely because the higher scoring candidates were white. The question is not whether that conduct was discriminatory but whether the city had a lawful justification for its race-based action.”

Using the strong-basis-in-evidence standard, the Court found no substantial basis in evidence that the exams were deficient. After laying out the detailed steps taken to develop and administer the exams, the Court rejected the city’s claims that the exams were not job-related and consistent with business necessity, noting the assertions were “blatantly contradicted” by the record that also included “painstaking analyses of the questions asked to assure their relevance to the captain and lieutenant positions.” The city “turned a blind eye to evidence that supported the exams’ validity,” wrote the Court.

The city could not disregard the exams solely because it feared litigation from black or Hispanic applicants. “Fear of litigation alone” cannot justify an employer’s “reliance on race to the detriment of individuals who passed the examinations and qualified for promotions,” concluded the Court. Such action was impermissible under Title VII and the petitioners were entitled to summary judgment. The High Court determined it “need not” decide the underlying constitutional question. Accordingly, the Second Circuit’s opinion was reversed and the cases were remanded for further proceedings consistent with this opinion.

The 5-4 decision was written by Justice Kennedy, who was joined by Chief Justice Roberts and Justices Scalia, Thomas and Alito. Justice Scalia filed a concurring opinion. Justice Alito filed concurring opinion joined by Justices Scalia and Thomas. Justice Ginsburg filed a dissent joined by Justices Stevens, Souter and Breyer.

Friday, June 26, 2009

Monitoring “keystrokes” a privacy issue, or just good business practice?

Interested in monitoring your employees’ computer-related movements? Worried your employer might be watching “too closely” while you are sitting in front of your computer? In Brahmana v Lembo, N.D. Cal. May 20, 2009, one employee, one employer and a federal trial court in California are about to at least decide if monitoring down to the very keystroke violates privacy rights, or at least those rights under the Electronic Communications Privacy Act (ECPA). This law sets out the stipulations for the access, use, disclosure, interception and privacy protections of electronic communications.

The employee in the case alleged that his employer unlawfully monitored his computer keystrokes in order to obtain the password to his personal email account, and the employee bolstered this argument by alleging that the employer knew information that was never shared and could have only been known by reading his personal emails. According to the employee, his employer used monitoring tools such as local area network analyzers and key loggers to record his keystrokes when he entered his email password, in violation of the ECPA. The employer sought a dismissal of this claim

The Ninth Circuit Court noted that gaining access to stored electronic information does not violate the ECPA; however, the Act is implicated when electronic communications are “intercepted” during transmission. The court therefore reasoned that the employee’s allegations were “… sufficient to render plausible the claim that [the employee’s] communications were monitored in some way, but they do not specify whether the particular means of monitoring might monitor keystrokes that had actually affected interstate commerce,” as required by the statute. Because some means of the alleged monitoring may constitute a violation of federal law, the employee’s complaint was not dismissed.

As this case proceeds, the impact its final decision delivers will most certainly prove to have a powerful effect on both employer and employee. On the one hand, employees today often rely heavily on their workplace computer, and the Internet has proven to be both a valuable working tool, as well as an “escape” during the workday. On the other hand, while employers know a happy employee is a productive employee, “productivity” is always the key, and most employers want employees working, not surfing, and so the use of monitoring software seems to be one way to curb excessive Internet use.

Moving forward, the employer’s defense will provide an idea of what it did or did not do, and whether it actually monitored keystrokes and intercepted private information, and whether this was a violation of the ECPA. But a question that may not get posed, but is certainly on the minds of both employer and employee is: If this type of monitoring is legal, does an employer have carte blanche to monitor an employee’s computer use, and if so, how will that impact the workplace?

Wednesday, June 24, 2009

The latest lesson on the “ordinary meaning” of a critical preposition

The US Supreme Court on June 18, 2009 gave us a new lesson on the “ordinary meaning” of the words “because of.” Construing this critical preposition in the text of the Age Discrimination in Employment Act (ADEA), a five-Justice majority concluded the statute’s requirement that an adverse employment action was taken “because of” age means that “age was the ‘reason’ that the employer decided to act.” (Gross v FBL Fin Servs, Inc, USSCt, Dkt 08-441). Thus, held the majority, to establish a disparate treatment claim under “the plain language” of the ADEA, “a plaintiff must prove that age was the ‘but-for’ cause of the employer’s adverse decision.” Age bias must be the sole cause, not just one cause.

Of course, as we all know, reasonable minds can differ. And in this case, four Justices had an entirely different take on the meaning of those two little words: “The most natural reading of this statutory text prohibits adverse employment actions motivated in whole or in part by the age of the employee,” wrote Justice Stevens, joined by Justices Souter, Ginsburg and Breyer, dissenting. Acknowledging the majority’s correct citation of the dictionary definition of the controversial preposition – “‘by reason of’ or ‘on account of,’” – Justice Stevens emphasized in a footnote that the dictionary does not define “because of” as “‘solely by reason of’ or ‘exclusively on account of.’”

In a separate dissent authored by Justice Breyer and joined by Justices Souter and Ginsburg, the Justices declare: “The words ‘because of’ do not inherently require a showing of ‘but-for’ causation.” These three dissenting Justices found no reason to read the disputed preposition to require “but-for” causation.

Then there’s the matter of the meaning ascribed to the same two words in the High Court’s Price Waterhouse v Hopkins decision (49 EPD ¶38,936). Justice Stevens reminded the Gross Court that the words “because of” in the earlier plurality opinion concerning a Title VII sex-bias claim meant “that gender must be irrelevant to employment decisions.” “As we made clear, when ‘an employer considers both gender and legitimate factors at the time of making a decision, that decision was because of sex,’” Justice Stevens wrote.

I know– different Court, different Justices – only three of the Court’s current Justices were on the Court in 1989 when Price Waterhouse was decided. Still, it seems that the “ordinary meaning” of the words “because of” would not have changed so much in the ensuing 20 years. After all, the majority in Gross relied on definitions obtained from dictionaries published in 1966 and 1933.

In any event, I suspect the confusion over this recent lesson on the “ordinary meaning” of this critical preposition will soon be irrelevant. Relying on its narrow construction of the words “because of,” the High Court closed off to age-bias plaintiffs the mixed-motives route (available in Title VII cases) that would enable proof of employment discrimination when the prohibited bias was at least one, but not the only, motive for an adverse action. With so many older individuals in the workforce and the increased incidence of age-bias claims, I don’t think this higher standard for age-bias claims will remain the law for long. The 29-percent increase in EEOC age bias charges filed in 2008 over those filed in 2007 – a 48-percent jump from the number filed in 2005 – should provide enough momentum for Congress to take action.

Monday, June 22, 2009

Hospitals were subcontractors subject to OFCCP jurisdiction

The Department of Labor's Administrative Review Board (ARB) has recently held that three hospitals were federal subcontractors subject to the equal employment opportunity and affirmative action obligations enforced by the Office of Federal Contract Compliance Programs (OFCCP), rejecting the hospitals’ assertion that the ARB’s 2003 decision in OFCCP v Bridgeport Hospital (ARB Case No 00-034; CCH OFCCP FEDERAL CONTRACT COMPLIANCE MANUAL ¶21,603) required a contrary ruling. In OFCCP v UPMC Braddock (DOL ARB, No 08-048, May 29, 2009), the US Office of Personnel Management (OPM) had a contract with UPMC Health Plan to provide medical coverage to US government employees. In turn, each of the three hospitals had an agreement with UPMC Health Plan to provide medical products and services covered by UPMC Health Plan. 

In Bridgeport Hospital, the Blue Cross/Blue Shield Association (Blue Cross) entered into a contract with OPM to provide health insurance to federal employees; Blue Cross then entered into a contract with Blue Cross of Connecticut to provide health insurance for federal employees in Connecticut, thus making Blue Cross of Connecticut a federal subcontractor. Subsequently, Bridgeport Hospital entered into a contract with Blue Cross of Connecticut to provide medical services and supplies to members of Blue Cross of Connecticut for a one-year period. The ARB found that Bridgeport Hospital was not a subcontractor because Blue Cross' contract with OPM did not require Blue Cross to provide its policy holders with medical care. 

Following Bridgeport Hospital, many experts thought that hospitals would not generally qualify as subcontractors subject to OFCCP jurisdiction (see e.g. “NELI experts Fox, Biermann discuss recent OFCCP developments” in CCH OFCCP FEDERAL CONTRACT COMPLIANCE MANUAL Newsletter, December 5, 2003). But, in UPMC Braddock, the ARB distinguished Bridgeport Hospital:

"Unlike Blue Cross, the UPMC [Health Plan] is more than an insurer," the ARB stated, noting that the UPMC Health Plan is an HMO that contracts with individual physicians, medical groups, and hospitals to provide benefits including medical services and supplies and surgical and anesthesia services, emergency services, mental health and substance abuse services, prescription drug benefits, and dental benefits. "Unlike Bridgeport Hospital, [the hospitals in the present case] contracted to provide 'a portion of the [the UPMC Health Plan's] obligation' to provide medical services and supplies under its contract with OPM," the ARB wrote. 

Friday, June 19, 2009

Another Circuit Court rules on validity of two-member NLRB decisions

This week, the Second Circuit ruled in support of well over 100 two-member NLRB decisions. The tally now stands at 3-1. The issue: whether a quorum of the Board can be constituted with just two of five members under Section 3(b) of the NLRA.

Joining the First and Seventh Circuits, the court, in Snell Island SNF v NLRB, believed the Board's view "is a reasonable interpretation of the statute. Indeed, we commend the NLRB for its conscientious efforts to stay 'open for business' in the face of vacancies that it did not create and for which it lacked the authority to fill."

As noted in Workplace Prof Blog, a decision from the Eighth Circuit will be forthcoming, making the issue even more destined for the Supreme Court. A Petition of Certiorari has already been filed in New Process Steel by the law firm Greenberg Traurig, P.A. "The D.C. Circuit [in Laurel Baye Healthcare v NLRB] correctly held that the NLRA does not permit the board to function with only two members. We believe that the Seventh Circuit's decision is an incorrect interpretation of the act," said Joseph W. Ambash, one of the attorneys representing New Process.

Here is a rundown of the cases on the matter to date.

For the Board:

And against:

Wednesday, June 17, 2009

Is federal anti-discrimination protection for breastfeeding women in workplace on the horizon?

Numerous states have provided women who breastfeed in the workplace with protection from discrimination while federal anti-discrimination protections have been absent. That may change, thanks to legislation recently introduced by New York Representative Carolyn Maloney (D). The Breastfeeding Promotion Act of 2009 (H.R. 2819) would amend the 1964 Civil Rights Act to provide anti-discrimination protections for women who breastfeed in the workplace. The Act would also require employers to provide a private space, other than a bathroom, where a woman can express breast milk and amends the Internal Revenue Code to provide employers up to $10,000 credit for expenses incurred.

“‘The Breastfeeding Promotion Act’ recognizes both scientific fact and the way Americans live now; human milk is the best nutrient for new babies—and most mothers have to go back to work during a child’s first year, when breastfeeding is most important,” Rep. Maloney said on June 11th during the announcement of the bill’s introduction.

“This bill will bring breastfeeding mothers under the protection of the 1964 Civil Rights Act, require employers with over 50 employees to provide a private space and unpaid time off during the workday for mothers to express milk, and sets standards for breast pump manufacture. It also provides for tax incentives for employers that establish private lactation areas in the workplace and tax credits for nursing mothers,” she said.

A similar bill (S. 1244) was introduced in the Senate by Oregon Senator Jeff Merkley (D).

“It’s not every day we have the opportunity to enact legislation that is so clearly a win-win for families and our nation. Making it easier for moms to breastfeed means we have healthier babies, stronger families and happier workers,” Sen. Merkley said. “I championed Oregon’s breastfeeding bill two years ago. I’m excited to see Oregon’s contribution to a nationwide movement embraced by Representative Maloney and all those who have long advocated the purely common sense notion that breast milk is best.”

Monday, June 15, 2009

$86 million judgment reversed in Starbucks’ tip-pooling suit

Is a Starbucks shift supervisor who works alongside baristas considered as just part of a customer service team when it comes to taking a cut of the pooled tips? Apparently so, a California appeals court ruled (Chau v Starbucks Corp, CalCtApp, June 2, 2009) when it recently reversed an $86 million judgment against Starbucks in a class action suit in which the trial court found the coffee chain violated state law by including the supervisors in tip pools.

The lower court’s ruling, the appellate court reasoned, was improperly based on a line of decisions addressing an employer’s authority to mandate that a tip given to an individual service employee must be shared with other employees. It noted that Starbucks’ shift supervisors are part-time employees who perform all the duties of a barista, along with having responsibility for additional tasks, including supervising and coordinating employees within the store. There is no decisional or statutory authority prohibiting an employer from allowing a service employee to keep a portion of the collective tip, the court said, in proportion to the amount of hours worked, just because the employee also has supervisory duties.

While acknowledging that sec. 351 of the Labor Code, which Starbucks was found to have violated, was enacted to prevent employees from having to give up their earned gratuities as a condition of employment, the court concluded that it was undisputed in this case that the tipping public intended to collectively tip both the baristas and the shift supervisors for their work as a “team.”

Friday, June 12, 2009

Don’t believe the hike, say opponents of minimum wage increase

Hold off on that next minimum wage hike, urged David Neumark, a professor of economics at the University of California, Irvine, in an opinion piece in today’s Wall Street Journal.

The federal minimum wage is scheduled to increase to $7.25 per hour in July, from the current rate of $6.55. It’s the last in a three-step increase in the minimum wage rate enacted under the Fair Minimum Wage Act of 2007, a happier time — economically speaking — when the nation’s unemployment rate stood at a modest 4.5%. The 2007 rate hike, the first in ten years, broke the longest stretch without an increase since the Fair Labor Standards Act (FLSA) was passed in 1938. But now, "with the aggregate unemployment rate at 9.4%, the teen unemployment rate exceeding 22%, and the unemployment rate for black teens nearing 40%, next month's increase seems like the worst timing possible," Neumark wrote. He warns that the 11% minimum wage increase will lead to the loss of an additional 300,000 jobs among teens and young adults — "on top of the continuing job losses the recession is likely to throw our way."

"Minimum wages, like most public policies, confront us with trade-offs," Neumark notes. "An employed, low-skilled worker who keeps his job earns a slightly higher wage. But a worker who loses his job, or a labor-market entrant or unemployed worker who cannot find a new job, pays a much higher cost."

It’s a debate that has raged for decades: Does a minimum wage increase boost the wages of our lowest-paid workers, or does it put them out of work? It depends on whom you ask.

Minimum wage hikes increase consumer spending, says the Economic Policy Institute, a nonprofit think tank, citing a study by economists at the Federal Reserve Bank of Chicago. The organization claims the first two increases in July 2007 and July 2008 will have generated an estimated $4.9 billion of spending by July 2009, and that the coming rate hike will bring in another $5.5 billion over the following year. The results demonstrate that an increase in the minimum wage benefits not only low-income workers, but boosts consumer spending and the broader economy as well, the Economic Policy Institute says.

Hogwash, counters the Employment Policies Institute. (The similarly named think tanks have been sparring on the issue for years.) The Employment Policies Institute has long asserted "the time-tested economic consensus" that minimum wage hikes lead to job loss for low-skilled employees. Responding to the most recent study, Kristen Lopez Eastlick, its senior research analyst, said university-conducted economic research "overwhelmingly runs counter" to the Economic Policy Institute’s claims. Various studies continue to affirm that increases in the minimum wage are poorly targeted to benefit low-wage families, as Census Bureau data shows the average family income of minimum wage employees is nearly $45,000 a year.

"In fact, the federal minimum wage hike has priced employees out of the workforce, and based on recent data from the Bureau of Labor Statistics, it’s the low and unskilled workforce — especially minority teens — who are getting hit the hardest."

On the other hand, the Fiscal Policy Institute and Policy Matters Ohio reported a few years ago that, since 1997, states with higher minimum wages have generally performed as well or better economically than states with lower minimums. The findings were consistent, the groups said, with "a growing body of economic research that has called into question the long-held prediction that a higher minimum wage will reduce the number of jobs or the number of hours worked by low-wage workers."

To be sure, when enacted in 1938, the FLSA’s purpose was to grow jobs. The overtime provisions of the Act intended to spread the job wealth by making it costlier for employers to work their current employees more than 40 hours in a workweek. But the legislation also sought to eliminate labor conditions that were seen as detrimental "to the maintenance of the minimum standard of living necessary for health, efficiency, and general well-being of workers." (29 U.S.C. 202(a)). Thus, the minimum wage. There was a floor below which no American worker should be expected to work, Congress reasoned. It is the friction between these two competing goals, perhaps, that has led to the discord we see today.

In the end, Neumark laments: "I do not expect President Obama or congressional Democrats to give up their long-held support for a higher minimum wage." Indeed, the minimum wage hike is likely a done deal. But the battle over its wisdom will rage on.

Wednesday, June 10, 2009

With paid leave for federal employees possible, are private sector employees next?

With the current economic outlook looking bleak, more and more private businesses are looking to trim payroll and cut staff in order to stay afloat. However, certain programs advancing in Congress, like the Federal Employees Paid Parental Leave Act (H.R. 626), seem to defy those cost-cutting trends as it would add, not subtract, costs. The Congressional Budget Office has estimated it could cost as much as $938 million from fiscal 2010 to fiscal 2014.

The Act, which passed the House by a vote of 258-154 on June 4, 2009, would provide paid parental leave benefits to all federal employees. It would provide all federal employees with four weeks of paid parental leave for the birth or adoption of a child, and would allow employees to use accrued sick or annual leave instead of the 12 weeks of leave guaranteed to them under the Family and Medical Leave Act.

Representative Carolyn B. Maloney (D-NY), a supporter of the bill, recently said that "families and family values are a top priority for President Obama and with his signature, our workforce will soon have comparable standards to professional private sector employees—and the rest of the industrialized world." Whereas, Representative Darrell Issa, (R-Calif), who offered an amendment to H.R. 626 that was defeated—as it did not provide employees with paid parental leave—posted a video on YouTube outlining his opposition to the bill, calling it yet another government bailout.

For the private employer, one issue comes to mind: Will passage of H.R. 626 begin the process of required paid leave for private sector industries? Private sector employees must be wondering what Rep. Maloney means by “comparable standards to professional private sector employees,” as most private businesses do not provide paid parental leave beyond vacation pay. In fact, only California, Washington and New Jersey currently have family leave insurance programs, and Washington just delayed for three years (S.B. 6158), from October 2009 until October 2012, implementation of the state's paid family leave insurance law.

If eventually signed into law, H.R. 626 would provide federal employees with another job-related “perk,” and it would certainly have private sector employees clamoring for the same kind of paid leave. How it would affect the bottom line is the critical issue. Private businesses have raised cost issues with the FMLA ever since it was passed into law (i.e., costs associated with giving employees time off, costs of litigating FMLA claims), and the FMLA only requires unpaid leave. Add paid leave to the equation, along with tough economic times, and there may be even more cost-related issues as private businesses look to trim even more staff, or even “close shop” altogether.

Monday, June 8, 2009

If a presumption falls in the woods and there’s no one there to hear it…

This has flown somewhat under the radar, but Montana has statutorily reversed the underlying presumption of the employment at-will doctrine. Under Montana's Wrongful Discharge from Employment Act, MONT. CODE ANN. § 39-2-901 et seq., subject to statutory exceptions, employers must have just cause before discharging at-will employees. In a recent, unpublished, 9th Circuit case, Johannsen v. Nike Inc., No. 08-35040 (9th Cir. June 2, 2009), a sales representative claimed that her company expanded her territory to such an extent that she could not reasonably cover it, resulting in a constructive discharge lacking just cause. The plaintiff won at trial and Nike appealed the denial of judgment as a matter of law.

In affirming the lower court’s verdict, the Ninth Circuit looked to the Act, which defines constructive discharge as an employee’s voluntary termination of employment stemming from a situation created by an act or omission of the employer, one so intolerable that a reasonable person would find voluntary termination to be their only reasonable alternative. Under the Montana Act, however, an employer's refusal to promote the employee or improve terms and conditions of employment does not constitute such an action. The district court found that Nike admitted that the job as expanded was not workable and that the plaintiff’s territory had to be adjusted, but Nike failed to work with the plaintiff to design a more reasonable territory within a reasonable time frame.

The court also ruled that the employee had no reasonable alternative to resigning, as Nike failed to either negotiate with her, or respond to her complaints until after her resignation. Finally, the court held that the Act’s "terms and conditions" language did not apply because -- in contrast to failing to improve conditions -- Nike positively worsened the plaintiff's working conditions. The court found that the Act's "terms and conditions" language bars only those claims predicated on an employer's failure to improve conditions beyond the status quo; it does not exclude allegations that conditions have worsened past the point that a reasonable person would find them intolerable.

While the case itself seems to be a relatively run-of-the-mill constructive discharge case, what strikes me as interesting is how little attention the Ninth Circuit drew to the reversal of the employment at-will doctrine. Now, the legislation isn’t all that new, but it is still somewhat surprising that the court didn’t really remark upon this provision of the Act. Montana is traditionally viewed as a politically “red” state, which may account for the lack of outcry. Still, as labor and employers battle for the upper hand in these economically difficult times, it may be worth watching whether other state legislatures will feel pressure to adopt similar laws.

Friday, June 5, 2009

Don’t shoot yourself in the foot by asking applicants about their guns

Job applicants have legal rights under federal and state laws even before they become employees, which is why employers must be careful about what questions they ask applicants during the hiring process. Employers should avoid certain questions because they cannot discriminate in the hiring process based on the applicant’s race, national origin, sex, pregnancy, age, disability, genetic information or religion. State laws may also specify additional protected classes, such as sexual orientation or gender identity. But what about gun ownership? Is that a protected category? Well, it is in Oklahoma.

A law that took effect May 22 prohibits Oklahoma private and public employers from asking job applicants whether or not they own or possess a firearm. Private employers violating the law would be guilty of a misdemeanor, punishable by a fine of up to $1000. Public employers and public officials violating the law would be acting outside the scope of their employment and accordingly barred from seeking immunity under the Governmental Tort Claims Act.

Were Oklahoma applicants facing a barrage of questions about gun ownership? Where did this come from? Sponsored by Rep. Rex Duncan (R-Sand Springs), the bill was introduced in direct response to question 59 in a seven-page, 63-item questionnaire given to Obama Administration job applicants. It asked about gun ownership, including registration information, usage and whether the gun had caused any personal injuries or property damage. The law comes only a few months after the Tenth Circuit’s decision holding that OSHA does not preempt “guns-at-work” amendments to Oklahoma’s Firearms Act and the Oklahoma Self-Defense Act permitting employees to store guns in their locked vehicles on company property.

Quick to respond, the NRA supports the Oklahoma law and is taking the Obama Administration to task over the questionnaire. Why are such questions even necessary, the NRA asks, explaining that if misuse of a gun results in applicants having a criminal record, that would be disclosed in other questions—about criminal investigations, arrests, charges or convictions—asked in the questionnaire. (Note that because arrests and investigations alone aren’t reliable evidence that a person has actually committed a crime, employers shouldn’t reject applicants solely because of a prior conviction unless they can demonstrate a relationship between the conviction and the job requirements).

Peter Hamm, Communications Director for the Brady Center, wonders if the Oklahoma law is simply a “solution in search of a problem.” Are such questions really commonplace in the hiring process of most employers?, asked Hamm, who confirmed that the Brady Center does not ask applicants questions about gun ownership, even if the Obama Administration is vetting applicants differently.

While Oklahoma is the first to recognize gun ownership as a prohibited class, it may not be the last. Senator Jim DeMint (R-SC) has declared his intent to enact federal “legislation to prohibit this type of discrimination,” according to ABC News. What does all this mean? First and foremost, all employers should remember to ask applicants only questions that relate directly to their qualifications and ability to do the job. But, for now, Oklahoma employers had better train their staff not to ask applicants about hunting, target or skeet shooting or any other activities that might include gun ownership.

Wednesday, June 3, 2009

EEOC wrestles with social networking sites in proposed GINA regulations

The EEOC has joined the ranks of those who are trying to figure out exactly how the Internet – personal and social networking websites, in particular – fit into the antidiscrimination landscape. In March, the EEOC posted its proposed regulation implementing Title II of the Genetic Nondiscrimination Act of 2008 (GINA), specifically requesting comments concerning the “commercial and publicly available” exception to GINA’s prohibition against employer requests, requirements or purchases of genetic information about an employee or his or her family member.

GINA’s exception comes into play “where an employer purchases documents that are commercially and publicly available (including newspapers, magazines, periodicals, and books, but not including medical databases or court records) that include family medical history.” (Sec. 202(b)(4)). The proposed reg expands on the sources excepted from the prohibition by adding “through electronic media, such as information communicated through television, movies, or the Internet.” (29 CFR Part 1635.8(b)(4)). The agency invited comments about sources similar to those identified in the statute, such as personal websites or social networking sites, which might contain family medical history that should be included either among the excepted sources or the prohibited sources, such as personal websites or social networking sites.

Some comments pointed out the obvious: that personal websites, blogs and social networking sites are widely used by the public and, thus, should fall within the commercially and publicly available sources exception. Others were more nuanced and focused on the type of access required or the likelihood the site would contain genetic information, rather than a private vs. public distinction. Where the site is limited by group membership, requires an individual to permit access or has a likelihood of containing genetic information, the exception should be unavailable under this model. Still others suggested that the exception should not apply where there is specific intent to search for information about a particular individual or family member – otherwise, the exception would swallow the rule. As one commenter put it, “the regulation must regulate conduct and not simply selected sources of information.”

Moreover, excluding searches of medical databases and court records from the exception doesn’t go far enough, according to some commenters. Covered entities should be prohibited from engaging in conduct that will knowingly or likely lead to collection of genetic information, including Internet searches for personal information about employees and their families. Thus, covered entities should not be allowed to search for information about employees or applicants or their family members on social networking sites because of the likelihood that family history information will be included, under this theory.

Concern that covered entities would purchase consumer lists and profiles containing medical information made available by the large and lucrative consumer databroker industry was also expressed by some commenters. To prevent against acquisition of genetic information under the guise that it was incidentally obtained from a consumer databroker, this source of information should be treated in the same manner as medical databases, and thus, not subject to the exception, these commenters opine.

It’s worth mentioning that the EEOC’s proposed regulation also includes a confidentiality provision stating that although genetic information acquired through publicly available sources is not considered confidential genetic information, it may not be used to discriminate against an individual. (Sec. 1635.9(a)(4)).

Nonetheless, it would seem that a cautious, and perhaps skeptical, approach to the issue may be warranted. According to Market Watch, studies show that more than 40 percent of employers have trolled Facebook and other social networking sites to obtain information about applicants. Moreover, when they discover negative information on these sites, more than 80 percent of employers factor that information into their hiring decisions. When Title II of GINA takes effect on November 21, 2009, there will be one more factor for employers to take into consideration, or not.