Wednesday, January 26, 2011

9th Circuit Expands Reach of WARN Act, Defines "Voluntary Departure"

The Worker Adjustment Retraining Notification Act (“WARN”) is a law that requires "covered employers" (usually those with 100 or more employees) to give 60 days’ advance notice before ordering a “plant closing” or “mass layoff.” A "plant closing" is the permanent or 30-day or longer shutdown of a single employment site resulting in an “employment loss” for 50 or more employees. A "mass layoff" is a reduction in force creating an employment loss in any 30-day period for a substantial proportion of the workforce, but at least 50 employees. If a "covered employer" fails to give proper notice under the WARN act, the penalty is back pay and benefits for the period of the violation (i.e., up to 60 days), which can be devastating to an employer if, for example, they had to pay out for 125 employees who each earn $1,000/week (125 x $1,000 x 8 weeks= $1,000,000.00).

A recent decision from the Court of Appeals for the Ninth Circuit involved a chain of automobile dealerships, Gee West, that only gave 11 days' notice to its 150 employees in the Seattle, Washington area. Employees immediately stopped reporting for work in substantial numbers, presumably to seek replacement employment. By the date of closure, only 30 employees remained. Gee West argued that the 120 employees who abandoned employment after the announcement of the impending closing had voluntarily departed, thereby excluding them from WARN’s application only to employees experiencing an “employment loss.” Gee West argued that not only did those 120 employees not qualify for WARN damages, but that, with only 30 employees experiencing an employment loss on the plant closing date, there were insufficient affected employees to trigger Gee West’s WARN notice obligations. The 9th Circuit saw it quite differently.

The 9th Circuit held that employees who separate from employment because the business is closing have not “voluntarily departed” within the meaning of WARN. Instead, because at the time notice was required they could reasonably have been expected to experience an “employment loss” upon closure of the business, they must be counted to reach the WARN notice threshold and are eligible for WARN damages to the extent notice was not given. However, the 9th Circuit also held that some employees who depart after insufficient notice of an impending plant closing or mass layoff could still be voluntary departees excluded from WARN coverage. The court cited as examples persons who leave during the notice period because of pregnancy, health, or a better job opportunity. By extension, persons who separate by retirement (instead of resignation) for reasons unrelated to the notice of impending plant closure or mass layoff would also not be counted against the WARN notice threshold or be eligible for WARN damages. These exceptions are fact-intensive and must be determined on a case-by-case basis in the trial court. The employer would have the evidentiary burden of proving the exceptions.

The case is Collins v. Gee West Seattle LLC, Case No. 09-36110 (9th Cir., filed Jan. 21, 2011).

Tuesday, January 25, 2011

9th Circuit Makes it Harder for Employers to Recover Attorney's Fees in Frivolous Claims in Multi-Count Suits

A recent decision by the Court of Appeals for the Ninth Circuit has held that even if an employer carries its burden of showing that some of a plaintiff’s claims are “frivolous, unreasonable or without foundation”—itself no easy task—the employer can only recover those fees “exclusively” attributable to defending against the frivolous claims. What this means is that, for example, if an attorney spends time preparing for or attending a deposition or hearing, or drafting a motion, pertaining to both frivolous and non-frivolous claims, the employer cannot recover any fees for that work, even on a pro rata basis.

In the case, the plaintiff filed a complaint alleging ten separate claims for relief and the district court, after all ten were resolved through dispositive motions, found that five of the ten counts were frivolous. From the Nixon Peabody story on the opinion:
The employer—which had incurred over $315,000 in attorney’s fees in total—sought recovery of approximately $10,000 in fees specifically attributable to the frivolous claims, over $250,000 in “general fees” (i.e., fees not allocated to any particular claim), and over $50,000 in non-taxable costs (i.e., expenses from computerized legal research, factual investigation, and photocopying). The district court then calculated the amount attributable to the frivolous claims by taking the “general fees” and dividing them equally across the plaintiff’s ten claims, and then “allocating to each claim for which it determined fees to be appropriate one-tenth of the total general fees.” It then reduced that number by half to take the plaintiff’s financial hardship into account. With respect to costs, the district court used a similar formula, awarding a prorated amount of defendants’ requested expenses based on whether or not costs were recoverable for the specific frivolous claim at issue.

The Ninth Circuit reversed and remanded for a new fees and costs determination. It stated that federal law encourages plaintiffs to bring civil rights claims, in part, by making the recovery of attorney’s fees by a successful plaintiff “a matter of course,”
while making the recovery of attorney’s fees by a successful defendant much more difficult.
Thus, employers on the West Coast have some serious hurdles when defending against a complaint that throws ""everything and the kitchen sink," so to speak. However, I do not think this decision will incentivize plaintiff attorneys to pile on frivolous claims just to induce settlement because there can still be repercussion for an attorney who intentionally files frivolous claims without due diligence. At the end of the day it does no one any good to file claims that will eventually get dismissed and simply wastes precious time and resources.

The case is Harris v. Maricopa County Superior Court, Case No. 09-15833.

Former TapouT Employee Awarded $3.2 Million in Wage Case

A former TapouT sales representative, Michelle Thomas, was awarded $2.4 million in punitive damages by a Los Angeles jury after previously being awarded $840,000 in compensatory damages, bringing her total award to more than $3.2 million in her wage & hour (and maybe wrongful termination?) claim against the MMA apparel company. From the Beverly Hills Courier story on the verdict:

The punitive damages phase was triggered when the panel concluded that TapouT acted with malice toward Thomas, who filed her suit in October 2008.

She maintained that she was not paid the commissions she was promised and was denied overtime for working as many as 70-plus hours some weeks during her eight months on the job.

Thomas also testified that employees were told to pay out of their own pocket for any television subscriptions needed to view the company's show on the Versus cable network, called "TapouT," as well as pay-per-view Ultimate Fighting Championship bouts.

Thomas said she was roundly criticized by a supervisor for not watching one required program on her birthday. She was fired in June 2008.

Defense attorney Gail F. Montgomery told jurors that TapouT sales representatives were entitled to time off instead of overtime because of their employee classifications.

She said Arika Helton, TapouT's national sales manager, testified Thomas never complained to her about not being paid overtime.

I am not entirely sure why the article labels this a "wrongful termination." Nevertheless, major verdict and victory for the plaintiff!

Chicago Car Salesman Fired for Wearing Green Bay Packer Tie

In yet another story of at-will employment gone awry comes the story of a Chicago-area car salesman who decided, perhaps in bad judgment, to wear a Green Bay Packer tie to work in the wake of the Chicago Bears loss to the Packers this past Sunday. The salesman, John Stone, wore the tie as part of a fashionable outfit for the day intended to be good-natured but his boss, Jerry Roberts, did not see it that way and told Stone that he had two options: take off the tie or get the hell out of his store (he might not have framed it exactly like that). For some reason, Stone decided not to undo the tie. So, Roberts fired him.

When asked why he fired Stone over something relatively benign, Roberts responded:
“(The tie) makes it harder to sell cars in what’s already a competitive sales environment.

“We spend $20,000 a month on advertising with the Bears on WBBM during the season, and we have Bears players including Corey Wootten driving loaner vehicles, and here was a salesman openly undoing that work.”

That's just how at-will employment works. This salesman's rights were not violated, so far as I can tell, and now he has to search for another job because he refused to take off a certain tie. Very unfortunate.

Thursday, January 20, 2011

7th Circuit Rules Oral "Right to Sue" from EEOC is Not Sufficient to Start 90-Day Period

In order for someone to pursue an employment claim in federal court a notice of dismissal rights, known as the "right to sue" letter, mailed to them by the Equal Employment Opportunity Commission (EEOC) is required first. Once a complainant receives this letter, they then only have 90 days to file suit in federal court or forever hold their peace. What happens if a complainant does not receive the right to sue letter that the EEOC has sent out? The Court of Appeals for the Seventh Circuit got a chance to rule on such a situation.

In DeTata v. Rollprint Packaging Products, Inc., No. 10-1596, the complainant, Sherry L. DeTata, filed a sexual harassment charge with the EEOC with the assistance of an attorney, Jewell Bracko, an attorney with the American Civil Rights Trust. Once the EEOC decided it was not going to represent DeTata, it promptly prepared and mailed out her right to sue letter in March 2009 except they mailed it to Bracko--three times. The letters were returned each time as undeliverable. DeTata did not find out about her dismissal rights until April or May 2009 when she called the EEOC to inquire about her case. Therefore, the EEOC re-issued her a right to sue letter in June 2009. DeTata then filed a pro se suit in federal court on Aug. 18, 2009, alleging sexual harassment and retaliation. The employer moved to dismiss claiming the suit was filed more than 90 days after the March 2 right to sue letter. The district court granted the motion, concluding that the 90-day period began to run, at the latest, when DeTata learned by phone that her complaint had been dismissed. DeTata appealed, and the 7th Circuit vacated the district court’s order in an opinion by Judge Diane P. Wood.

Noting that other circuits have held that oral notice may begin the 90-day period, the 7th Circuit declined to hold that oral communication may qualify as statutory notice. But neither did it hold that oral communication can never qualify. Instead, the court concluded that, even if it could, it would not be sufficient in this case. From the Wisconsin Law Journal who carried the story:
In 29 C.F.R. 1601.28(e), the EEOC identified four requirements for a notice of a complainant’s right to sue: authorization to the aggrieved person to bring a civil action under title VII within 90 days from receipt of such authorization; advice concerning the institution of such civil action by the person claiming to be aggrieved, where appropriate; a copy of the charge; and the Commission’s decision, determination, or dismissal.

The court found, “There is no evidence in this case that the EEOC’s oral communication to DeTata met any of the first three requirements. Most importantly, there is nothing in the record to suggest that the EEOC ever told DeTata when her 90-day clock began to run.”

The court found this requirement particularly important because the limitations period is so short.

Finally, the court rejected [the employer’s] argument that the notice sent to[DeTata's attorney] was sufficient, because Bracko was DeTata’s attorney. The court found that it was unclear from the record in what capacity [the attorney] was assisting DeTata.
Lesson to be learned: take the EEOC's right to sue notice seriously. Stay in touch with the EEOC on the status of your complaint. Though complainant's in the 7th Circuit may have slightly more protection, such is not the case for people in other circuits.

Wednesday, January 19, 2011

4th Circuit Rules on Computation of Unpaid Overtime in FLSA Cases

In a case that started out as a dispute over whether the plaintiffs were exempt under the administrative exemption under the Fair Labor Standards Act (FLSA), the Court of Appeals for the Fourth Circuit received a chance to rule on how unpaid overtime compensation should be computed. With respect to unpaid overtime compensation, the FLSA states:
Any employer who violates the provisions of [29 U.S.C. § 206 or § 207] shall be liable to the employee or employees affected in the amount of their unpaid minimum wages, or their unpaid overtime compensation, as the case may be, and in an additional equal amount as liquidated damages. 29 U.S.C. § 216(b).
On remand, the district court cited and used the Supreme Court's decision in Overnight Motor Transportation Co. v. Missel, 316 U.S. 572 (1942) to determine whether the appropriate overtime premium was 50% or 150% of that regular rate for all hours worked over 40. The district court held that 50% is the answer and the 4th Circuit agreed. In doing so, the 4th Circuit noted that they were joining four other circuits: "The First, Fifth, Seventh, and Tenth Circuits all have determined that a 50% overtime premium was appropriate in calculating unpaid overtime compensation under 29 U.S.C. § 216(b) in mistaken exemption classification cases, so long as the employer and employee had a mutual understanding that the fixed weekly salary was compensation for all hours worked each workweek and the salary provided compensation at a rate not less than the minimum wage for every hour worked."

"Willfulness" was the other issue in this appeal and the 4th Circuit held that a genuine issue of material fact exists and the matter was remanded back down to the district court for a trial on the issue of willfulness.

The case is Desmond v. PNGI Charles Town Gaming, (4th Cir. 1/18/11).

NLRB Weekly Summary of Cases

For the week of January 10-14, 2011.

Monday, January 17, 2011

California Court Rules Employee's Emails to Attorney NOT Privileged If Sent from Workplace!

I routinely tell clients not to email me from their workplace and to always use private email and this recent case out of a court of appeals in California illustrates exactly why. Plaintiff Gina Holmes was working as an assistant to the CEO of Petrovich Development Co. LLC, Paul Petrovich. During the infancy (no pun intended) of her employment, Holmes became pregnant and apparently a strain in her employment relationship developed which caused her to hire a lawyer while at work. Apparently, Holmes became upset that Petrovich was forwarding her emails to others in the organization and quit, claiming, inter alia, constructive discharge, discrimination, and harassment. Most of Holmes' claims were dismissed except for the intentional infliction of emotional distress and invasion of privacy claims, which the jury found for in favor of the defendants. Holmes then appealed claiming that the trial court should not have allowed Petrovich to use the emails she sent to a lawyer seeking a referral, in which she explained her situation, but the California court of appeals disagreed:

Although a communication between persons in an attorney-client relationship "does not lose its privileged character for the sole reason that it is communicated by electronic means or because persons involved in the delivery, facilitation, or storage of electronic communication may have access to the content of the communication" (§ 917, subd. (b)), this does not mean that an electronic communication is privileged (1) when the electronic means used belongs to the defendant; (2) the defendant has advised the plaintiff that communications using electronic means are not private, may be monitored, and may be used only for business purposes; and (3) the plaintiff is aware of and agrees to these conditions. A communication under these circumstances is not a “„confidential communication between client and lawyer‟” within the meaning of section 952 because it is not transmitted “by a means which, so far as the client is aware, discloses the information to no third persons other than those who are present to further the interest of the client in the consultation . . . .” (Ibid.)


When Holmes e-mailed her attorney, she did not use her home computer to which some unknown persons involved in the delivery, facilitation, or storage may have access. Had she done so, that would have been a privileged communication unless Holmes allowed others to have access to her e-mails and disclosed their content. Instead, she used defendants‟ computer, after being expressly advised this was a means that was not private and was accessible by Petrovich, the very person about whom Holmes contacted her lawyer and whom Holmes sued. This is akin to consulting her attorney in one of defendants‟ conference rooms, in a loud voice, with the door open, yet unreasonably expecting that the conversation overheard by Petrovich would be privileged.


Thus, the lesson to be learned whether this is the law of your land or not and whether or not a particular employer uses a monitored electronic system is to simply tell your clients to avoid communicating with lawyers, or anyone else really, using workplace electronic devices because such communications may not be private or privileged.

The case is Holmes v. Petrovich Development Company LLC.

Sunday, January 16, 2011

Q: If I am fired from my job am I automatically disqualified from receiving unemployment compensation?

A: Not necessarily.

As an attorney who has handled over 100 unemployment compensation hearings, the most common issue I deal with is whether a claimant was "discharged for misconduct connected with employment." Probably a close second is whether a claimant was "discharged for failure to notify the employer of absenteeism and tardiness." Just as a layoff would qualify a claimant for benefits, so too would a termination that isn't for "misconduct."

The standard for what constitutes "misconduct" in Wisconsin arose in Boyton Cab Co. v. Neubeck, 237 Wis. 249, 259-60, 296 N.W. 636 (1941):

[T]he intended meaning of the term "misconduct" ... is limited to conduct evincing such wilful or wanton disregard of an employer's interests as is found in deliberate violations or disregard of standards of behavior which the employer has the right to expect of his employee, or in carelessness or negligence of such degree or recurrence as to manifest equal culpability, wrongful intent or evil design, or to show an intentional and substantial disregard of the employer's interest or of the employee's duties and obligations to his employer.

To put that language in lay terms, it means an employee cannot intentionally behave or commit acts in violation of the type of behavior that is to be expected of an employee. So, for example, if you're a janitor and continuously neglect to take the trash out, this could be considered misconduct which would disqualify you from receiving benefits. Every case differs and that is the reason why the Wisconsin Department of Workforce Development routinely holds appeal hearings on this issue because the same janitor who neglected to take the trash out may have had a good reason(s) which should allow for benefits.

Boyton Cab further states that:

On the other hand mere inefficiency, unsatisfactory conduct, failure in good performance as a result of inability or incapacity, inadvertencies or ordinary negligence in isolated instances, or good-faith errors in judgment or discretion are not to be deemed "misconduct" within the meaning of the statute.

So, if the janitor simply had too many other duties and responsibilities and limited time resulting in unreasonable expectations, this could be considered "failure in good performance as a result of inability or incapacity," which should result in a qualification for benefits.

There are numerous other reasons why a termination would result in disqualification from unemployment benefits but misconduct issues are the biggest as employer and employee often disagree over whether the termination was deserved and that then leads to contested unemployment benefits.

Saturday, January 15, 2011

Wisconsin Republicans to Introduce Legislation to Help UW Staff Avoid Unionization

Back in 2009 four unions petitioned the Wisconsin Employment Relations Commission (WERC) to reclassify 486 UW System employees from "academic staff" to "classified staff" which would put them into existing collective bargaining units. In response, last month the UW Board of Regents filed a lawsuit in Dane County Circuit Court asking that the Wisconsin Employment Relations Commission be ordered to stop moving forward with plans to hold job reclassification hearings. Now, four Republican Wisconsin lawmakers, Rep. Steve Nass (R-Whitewater), Sen. Glenn Grothman (R-West Bend), Sen. Alberta Darling (R-River Hills) and Rep. Robin Vos (R-Rochester), are vowing to introduce legislation that would prevent WERC from making these reclassifications.

The Milwaukee Journal Sentinel has a very short article on this story.

Friday, January 14, 2011

NLRB Tells AG's in Four States that Secret-Ballot Amendments are Preempted by Federal Law

This past election cycle four states, Arizona, South Carolina, South Dakota, and Utah, had ballot measures that would ban card check legislation--that is, sought to preempt the controversial Employee Free Choice Act (EFCA). In response to this, the National Labor Relations Board (NLRB) has advised the Attorney Generals in those four states these amendments conflict with federal labor law and therefore are preempted by the Supremacy Clause of the U.S. Constitution.

From the press release:

The states were also advised that the Board has authorized the Acting General Counsel to file lawsuits in federal court, if necessary, to enjoin them from enforcing the laws.


Under the 1935 National Labor Relations Act, private-sector employees have two ways to choose a union: They may vote in a secret-ballot election conducted by the NLRB, or they may persuade an employer to voluntarily recognize a union after showing majority support by signed authorization cards or other means.

The state amendments prohibit the second method and therefore interfere with the exercise of a well-established federally-protected right. For that reason, they are
preempted by the Supremacy Clause of the U.S. Constitution. Further details are available on this page, including a fact sheet prepared by the NLRB and copies of the advisory letters.

Staffing Agencies, Employers Covertly Violating Anti-Discrimination Laws

Laura Bassett has a very disturbing article on the Huffington Post about how employers and staffing agencies are getting around labor and anti-discrimination laws and the difficulty in proving it--unless a whistleblower comes forward. The article also touches on the other recent trend of job postings requiring an applicant to currently be employed to be considered. From the article:
"A lot of it's under the radar," Bob Rose, a supervisory trial attorney for the federal Equal Employment Opportunity Commission, said. "We had a case in Buffalo where a number of former full-time employees at a staffing firm came forward to tell us about how the agency complied with these discriminatory requests, using codewords for whites and codewords for blacks internally to mask some of it. If an employer submits a profile sheet to a staffing agency, we see them use a code on it so the employee who ends up filling the job knows, 'Oh, I can't send blacks,' or 'I can't send women.' There are all kinds of violations going on."
...

A 53-year-old executive recruiter named Nick, who asked that his full name be withheld to protect his job, told HuffPost he has worked for major U.S. staffing firms since 1990. As an industry insider, Nick said, he became privy to the many ways companies and staffing firms sidestep labor laws.

"There's a lot of dirty stuff going on, a lot of hush-hush discrimination, I can assure you," he said. "As a recruiter, you get an HR director on the phone, and they tell you point blank, 'We want somebody in this age bracket, or this particular gender, currently has a job. We don't want to see a resume from anyone who's not working.' It happens all the time."

The article then discusses the potential problem with criteria requiring an applicant to be currently employed in that it potentially has a disparate impact on certain protected classes of people like minorities who are more likely to be unemployed for various reasons. There's already been at least one big lawsuit with a huge settlement payout because of discriminatory practices that were caught and proven and it's probably only a matter of time before an employer or staffing agency gets in trouble for the "must be employed" requirement.

Wednesday, January 12, 2011

Employer's Facebook Posts Sparks Lawsuit

Usually it's an employee's Facebook posts that get them in trouble but not at a popular suburban Pittsburgh sports bar. A former waitress, Audra Harris, filed a complaint with the EEOC alleging that tavern managers failed to take action when Harris filed a complaint with human resources against a manager in late September for uttering a sexual slur against her. Harris said a week later she found threatening comments on tavern owner Deborah Maggio's Facebook page that she believes were aimed at her. Harris resigned the next day, charging the Facebook postings were retaliation for her complaint.

I expect to see many, many more claims like this because of the way people use Facebook and how it has managed to severely blur the line between personal and professional in the workplace. Facebook is a website that allows people to communicate except, unlike spoken words, often times comments are left for all to see and be discovered as if we all recorded our conversations.

The Pittsburgh Tribune-Review has more on the story.

Tuesday, January 11, 2011

Employer Found Liable for Damages for Accessing Former Employees' Personal Emails

A district court in New York held that an employer who accessed two former employees' personal email accounts during an investigation after the employees quit are liable for damages under the federal Stored Communications Act (SCA), even if they suffered no actual damages. Since no actual damages need to be shown, the court also held that the calculation of statutory damages ($1,000 per violation), generally is based on the number of times the “electronic communications facility” (or personal e-mail account, e.g., Hotmail) is accessed, not the number of emails accessed. Furthermore, noting the SCA targets the unauthorized access of an electronic communication facility (not the e-mails themselves), and because there was nothing to indicate the number of times each of the four accounts were accessed over the short nine-day period, the court found four violations.

The case is Pure Power Boot Camp Inc. v. Warrior Fitness Boot Camp LLC.

3rd Circuit Rules Private Employers Permitted to Reject Applicants Based on Past Bankruptcy Filing

Many people, including many employment attorneys, are unaware that Section 525 of the Bankruptcy Code provides individuals with protection from discriminatory treatment as a result of having filed for bankruptcy. The actual section reads:

a.…[A] governmental unit may not…deny employment to, terminate the employment of, or discriminate with respect to employment against, a person that is or has been a debtor under this title or a bankrupt or a debtor under the Bankruptcy Act…

b.No private employer may terminate the employment of, or discriminate with respect to employment against, an individual who is or has been a debtor under this title, a debtor or
bankrupt under Bankruptcy Act…

However, subsection (b) does not include the same "deny employment to" provision that subsection (a) does regarding governmental units which is what led the Court of Appeals for the Third Circuit to recently rule that the differences in the plain language of Section 525(a) and Section 525(b) indicate an intentional decision of Congress to distinguish between the prohibited conduct of governmental and private employers. Therefore, the court said, Section 525(b) cannot be read broadly to prohibit private employers from denying employment based on past or present bankruptcy.

The 3rd Circuit is the first court to issue an opinion on this issue and more circuits may be likely to follow given the economic situation of many people in this country and the soar in bankruptcy filings that occurred in the past several years.

The case is Rea v. Federated Investors, No.2 -09-cv-01205 (3d Cir. Dec. 15, 2010).

NOTE: The 3rd Circuit is not the court of appeals that covers Wisconsin. Therefore, Wisconsin residents who feel they have been discriminated against because of their previous bankruptcy filings still have a course of action until the 7th Circuit or Supreme Court of the United States rules otherwise.

NLRB Weekly Summary of Cases

For the week of January 3-7. Includes a case out of Milwaukee!

Monday, January 10, 2011

Employment Case Law Update

--Ames v Home Depot USA, Inc., 7thCir.: an employee who was terminated for showing up to work under the influence of alcohol lost her Family Medical Leave Act (FMLA) and Americans with Disabilities Act (ADA) claims as the Court of Appeals for the Seventh Circuit upheld summary judgment. With respect to plaintiff's FMLA claim, the Court held that plaintiff failed to establish that she was entitled to leave under her burden to show FMLA interference when she missed work because of her alcohol problems because she could not show that her condition qualified as a serious health condition.
With respect to plaintiff's ADA claim, the Court held that the plaintiff failed to show that her alcoholism is an ADA disability because there is no evidence in the record that it substantially limited her major life activities.

--Walls v Miracorp, Inc., DKan: defendant's motion for summary judgment denied. Defendant employer unsuccessfully attempted to argue that they are not an "employer" under Title VII and that the plaintiff was not an "employee." In a nutshell, the defendant tried to argue that they did not have 15 or more employees to be liable under Title VII and in order to figure out the amount of employees the defendant had during the relevant time, the court used the payroll test. The Supreme Court has made clear that a name that appears on the payroll should not count toward the fifteen-employee threshold if that person is not an “employee” under traditional principles of agency law. Merely appearing on payroll does not count one toward an employer's employee count as the plaintiff attempted to argue. However, after applying the test, the court found the plaintiff presented enough evidence that the employer had 15 or more employers during the relevant time to proceed in her Title VII claim.

--Noble v Genco I, Inc., SDOhio: Defendant's motion to to dismiss granted in part, denied in part. Although a former employee’s claims for racial discrimination and retaliation in contravention of public policy were dismissed, the employee’s amended complaint alleging retaliation by the employer based on its allegedly providing negative job references was allowed to proceed. The defendant asserted that the retaliation claim should also be dismissed because the references given were not false but the court noted that the defendant pointed to no precedent within the jurisdiction adopting the false reference rule.

Friday, January 7, 2011

DOL Secretary Holis Issues Optimistic Statement on U.S. Employment Situation

Department of Labor Secretary Hilda L. Solis issued a statement in the wake of the new year with a highly optimistic tone on the state of the employment situation in the United States. From the DOL press release:
"The American economy has come a long way in the last two years. In the month President Obama was inaugurated, the economy lost nearly 800,000 jobs. In 2010, every single month posted private sector job growth, with well over a million jobs added throughout the year. And job growth has occurred in a broad range of industries, led by professional and business services, leisure and hospitality, and health care. Furthermore, business and consumer spending are growing, with manufacturing activity and disposable income for American families on the rise.
...
"Protecting the Affordable Care Act is a large part of that commitment. Now is not the time to play politics with the health of Americans and the health of the economy. The law provides all Americans the freedom to make career choices without having to worry about losing their health insurance when changing jobs. Repealing this law would deny millions of Americans that choice. Repeal would also take health insurance away from 30 million Americans, it would allow insurance companies to boost their profits at the expense of our citizens, and it would add at least a trillion dollars to the deficit. In addition, the law includes a tax credit for small businesses to cover up to 35 percent of premium costs of their employees. In 2014, this rate coverage will increase to 50 percent. Repealing the law will make it more expensive for small businesses burdened by rising health care costs to cover their employees.

"A new year and a new Congress usher in a shared responsibility to work together to create economic prosperity for all Americans. The fact is that almost one in 10 people in the labor force are still without a job. And that is where the Labor Department — and this administration — remain focused because the American people are looking to their government for commonsense leadership during these difficult times. While the employment situation is clearly improving, my mission remains the same: to create good and safe jobs for everyone. It is what the American people are counting on and a goal we will continue to keep at the forefront of everything we do."

7th Circuit Rules Former State Prosecutors Cannot Sue for Age Discrimination

Three former assistant prosecutors in the State’s Attorney Office in Cook County, Illinois were terminated in 2007 and then filed age discrimination suits under the Age Discrimination in Employment Act (ADEA). On appeal before the Court of Appeals for the Seventh Circuit, the court held that the prosecutors are, by definition, policymakers, and are therefore exempted from coverage of ADEA, thus, dismissing the actions. The Wisconsin Law Journal has an article on the ruling:

The ADEA gives immunity to states and their political subdivisions from suits by certain employees. Among the employees excluded from the ADEA are “appointee[s]on the policymaking level.”

The court concluded that all of Illinois’ Assistant State’s Attorneys are appointees on the policymaking level and therefore not within the coverage of the ADEA.

Under the 7th Circuit’s ADEA precedent, an employee is an appointee if “the position held by the individual authorizes, either directly or indirectly, meaningful input into
governmental decision-making on issues where there is room for principled disagreement on goals or their implementation.”

The court derived this test from Supreme Court cases permitting termination of individuals holding policymaking positions based on political affiliation. Elrod v. Burns, 427 U.S. 347 (1976).


The prosecutors argued they were not policymakers, and that, looking at their actual job functions and duties, each held a “low-level position.”

The court acknowledged that, in some cases, where an employee’s role is uncertain, it is for the jury to decide whether the employee is a policymaker.

But the court found that the duties of the prosecutors are clearly defined by precedents interpreting Illinois law, and render them policymakers.

The case is Opp v. Office of the State’s Attorney of Cook County, Nos. 09-3714, 09-3923 & 10-1060.

Thursday, January 6, 2011

Connecticut Case Displays Importance of Paying Attention to Technical Requirements of Statutes

As an attorney who primarily focuses on employment matters, I often find myself in a situation where I am either talking with a potential client or employer's counsel about the merits of a case and it isn't long into discussion where it finally comes up that perhaps the employer isn't subject to a particular statute. For example, not every employer is subject to Family and Medical Leave Act (FMLA) requirements if they do not have the requisite minimum amount of employees during a given time period. A case out of Connecticut displays how not paying attention to such technical statutory requirements can be quite detrimental (and embarrassing).

A woman filed suit in Connecticut court alleging violations of both Connecticut state employment laws as well as violations of Title VII. Because of the federal law counts, the matter was moved into federal court and then the defense moved for summary judgment upon the completion of discovery arguing that no more than 5 people were employed during the relevant times. Title VII requires that an employer employ 15 or more employees in each of 20 or more weeks in a year. The defense successfully proved they did not and the federal district court granted summary judgment dismissing the Title VII claims and remanded the leftover state charges to state court where those may also be dismissed if similar requirements are also present.

Lesson to be learned: pay attention to technical requirements ASAP.

The case is Jacobson v. Int't Tours & Events LLC.

Illinois Attorney Faces Ethics Complaint After Joining Union to Collect Benefits

An Illinois attorney, John P. Cooney, is facing an ethics complaint after he allegedly joined the United Brotherhood of Carpenters and Joiners Union just to receive benefits when he was not in fact a tradesman. Cooney merely worked as a lawyer for a carpentry and siding contractor. He joined the United Brotherhood of Carpenters and Joiners and collected $130,000 in medical and prescription claims over a nearly five-year period, the complaint alleges. He is accused of conduct involving dishonesty, fraud, deceit or misrepresentation.

Hat Tip: Legal Profession Blog

Wednesday, January 5, 2011

Employment Case Law Update

--Martin v PepsiAmericas, Inc., 5th Cir.: The 5th Circuit reiterated its bright-line rule that set-offs and counterclaims are not permissible in FLSA suits in holding that an employer may not set off the value of benefits that it paid out under a severance agreement against a claim for overtime wages under the FLSA.

--Mann v Heckler & Koch Defense, Inc., 4th Cir.: The 4th Circuit affirmed the lower court's decision to dismiss the Plaintiff's False Claims Act retaliation case. Plaintiff failed to make out a case for False Claims Act (“FCA”) retaliation action against his former employer because the Court found that his actions fell outside the scope of FCA protection because the conduct the plaintiff opposed involved nothing more than non-fraudulent statements made by the employer during the course of a contractual bidding process.
In upholding the lower court's decision, the court noted the three-prong test in qui tam retaliation cases and ultimately ruled that the plaintiff could not meet the distinct possibility standard because of one undeniable fact: there was no fraud. Therefore, based on the facts known to Mann at the time of his conduct, there was no reasonable possibility that his efforts could lead to a viable FCA action. The plaintiff made other arguments to show he engaged in "protected activity" but those too failed.

--Anfinson v FedEx Ground Package System, Inc., WA Court of Appeals: In an issue of first impression, a Washington State Court of Appeals ruled that a jury instruction that distinguished between employees and independent contractors by focusing on whether an employer has the right to control the details of an individual’s performance of work incorrectly stated the law and that that the economic realities test used by the majority of federal circuits is the proper test for determining whether a worker is an employee under Washington’s Minimum Wage Act (MWA).

NLRB Weekly Summary of Cases

For the week of December 27-31, 2010.

Tuesday, January 4, 2011

7th Circuit Rules Medical Evidence Not Necessary in Disability Discrimination Claim

The Court of Appeals for the Seventh Circuit delivered quite the present to plaintiff's attorneys this year in its ruling in Equal Employment Opportunity Commission v. Autozone, Inc., No. 10-1353. The EEOC alleged that AutoZone violated the Americans with Disabilities Act (ADA) in three ways: first, by failing to accommodate the plaintiff's physical limitations from March 2003 until September 2003; second, by discriminatorily denying the plaintiff the opportunity to work after September 2003; and third, by terminating him in retaliation for filing charges against the company. The district court granted summary judgment for AutoZone on the first claim, finding that the EEOC had not shown that the plaintiff had a disability within the meaning of the ADA as is required to demonstrate a failure to accommodate. A jury later ruled in favor of AutoZone on the discriminatory treatment and retaliation claims. The district court then denied the EEOC's motion to alter the judgment and for a partial new trial.

On appeal, the 7th Circuit had to decide whether the EEOC was required to present medical testimony to prove that the plaintiff was disabled within the meaning of the statute. They held that medical evidence was not necessary and precedent supports that conclusion. The court's analysis is quite in depth and shows that the plaintiff clearly presented enough evidence, without having to produce "medical evidence," that he was disabled within the meaning of the term in the ADA. The court also distinguished precedent Autozone attempted to use where medical evidence was required and showed that in those cases the plaintiff hadn't provided enough non-medical evidence to support an ADA claim.

Sunday, January 2, 2011

Lawsuit Claims Wisconsin Doctor Fired Over Potential Redeployment

The Milwaukee Journal Sentinel has a very short article about an emergency room doctor, David Merritt, at Black River Memorial Hospital in western Wisconsin who was terminated after he told hospital officials he might be redeployed in February. Merritt has filed a lawsuit against the hospital and is seeking reinstatement at the hospital, back pay and other damages.

The article is very brief and doesn't get into specifics of the lawsuit but Merritt more than likely filed a claim under the Uniformed Services Employment and Reemployment Rights Act (USERRA) which is federal legislation that protects the job rights of individuals who voluntarily or involuntarily leave employment positions to undertake military service or certain types of service in the National Disaster Medical System. USERRA also prohibits employers from discriminating against past and present members of the uniformed services, and applicants to the uniformed services.