Showing 89 posts from 2011.

Private Employer may Consider Bankruptcy Status in Hiring

April 1, 2011 by Hinshaw & Culbertson LLP

An applicant sued her employer, alleging that it discriminated against her when it refused to hire her because of her bankruptcy status. The U.S. Court of Appeals for the Fifth Circuit dismissed the applicant’s claim, holding that Section 525(b) of the Bankruptcy Code does not prohibit private entities from engaging in discrimination in hiring on the basis of bankruptcy status. The court held that the standard set forth for private employers in Section 525(b) differs from that set out for public employers in Section 525(a) of the Bankruptcy Code. Section 525(a) provides that the government is not permitted to “deny employment to, terminate the employment of, or discriminate with respect to employment against” any individual on the basis of his or her bankruptcy status. However, Section 525(b) of the Bankruptcy Code states only that “no private employer may terminate the employment of, or discriminate with respect to employment against” any individual on the basis of his or her bankruptcy status. The court explained that Congress’ exclusion of the words ”deny employment to” in Section 525(b) for private employers was intentional and purposeful. Private employers must remember that they may consider bankruptcy status in hiring decisions, but not when terminating employees. However, public employers should be aware that considering bankruptcy status in any employment decision will impose liability on the employer.

Employee’s Sleep Apnea not a Qualifying Disability Under the ADA

April 1, 2011 by Hinshaw & Culbertson LLP

A registered nurse suffered from sleep apnea and was repeatedly late for work as a result. The employee allegedly informed his employer that he was having difficulty sleeping and disclosed his suspicions regarding the possibility of having sleep apnea. The employee was subsequently given a verbal warning for excessive tardiness. The employee continued to arrive late, resulting in a suspension without pay and a threat of termination. These measures remedied the employee’s tardiness issue. However, months later, the employee had a verbal altercation with another co-worker and mentioned fatigue due to sleep apnea as one of several reasons. After being asked if he needed some time off to deal with his sleep apnea issues, the employee informed the employer that his “heart and soul were not in this job anymore.” The following day he was terminated. Subsequently, the employee received medical confirmation that he suffered from severe obstructive sleep apnea syndrome. He sued the employer under the Americans with Disabilities Act of 1990 (ADA) and the Pennsylvania Human Relations Act. The employer argued that the employee was not disabled under the ADA. The U.S. Court of Appeals for the Third Circuit agreed, and held that the employee was not a “qualified individual with a disability.” The court ruled that the employee’s sleep apnea did not “substantially limit” a major life activity because there was little evidence that the employee’s sleep was severely disrupted and the employee conceded that his sleep apnea did not impair his ability to do his job. Employers may take adverse action against employees who are performing inadequately, but must ensure that adverse action is never based on an employee’s disability. Additionally, with the recent issuance of the final regulations implementing the ADA Amendments Act (ADAAA), employers should be mindful that many conditions not previously considered “disabilities” under the ADA may now qualify and in most situations, employers should proceed cautiously by engaging in a good faith interactive process with their employees.

Employers bear Burden of Proving a Legitimate Business Reason Existed for Denying Employee Reinstatement Following FMLA Leave

April 1, 2011 by Hinshaw & Culbertson LLP

A city employee took Family and Medical Leave Act (FMLA) leave as a result of suffering from multiple chemical sensitivity. When the employee was medically cleared to return to work, the employer refused to reinstate her because it could not guarantee that the workplace was safe in light of the employee’s chemical sensitivity. A few months later, the employee was terminated. The employee sued, alleging that the employer violated the FMLA when it failed to reinstate her following her FMLA leave. Under the FMLA, an employee has a “limited right to reinstatement.” Specifically, the regulations implementing the FMLA provide that “if an employee is unable to perform an essential function of the position because of a physical or mental condition . . . the employee has no right to restoration. . . .” The trial court held that in order to prevail, the employee had to prove that she was denied reinstatement without reasonable cause. The U.S. Court of Appeals for the Ninth Circuit rejected that holding and found that under the FMLA, the burden is on the employer to prove that it had a legitimate reason for failing to reinstate the employee. Employers should always be able to articulate a legitimate business reason for denying reinstatement to employees who take FMLA leave. By ensuring that such a reason exists, employers will be able to defend against any subsequently filed lawsuit.

Employer’s Statements During Title VII Conciliation Process Cannot Create Oral Contract

April 1, 2011 by Hinshaw & Culbertson LLP

A group of employees filed charges with the U.S. Equal Employment Opportunity Commission (EEOC), alleging that their employer violated Title VII of the Civil Rights Act of 1964, as amended (Title VII), by discriminating against them because of their race. The EEOC initiated an informal “conciliation process” to attempt to resolve the dispute between the employer and the employees. After two weeks of negotiations, the employer withdrew from the process. The EEOC sued, alleging that the employer had verbally agreed to settlement terms before it withdrew. The agency argued that “[w]hat was ‘said or done’ during conciliation must be revealed to determine the existence of an oral agreement.” The U.S. Court of Appeals for the Fifth Circuit rejected the EEOC’s argument and held that disclosure of what the employer said during conciliation would be contrary to the plain language of Title VII’s confidentiality provision, which provides that “[n]othing said or done during and as a part of [the conciliation process] may be made public by the [EEOC].” Moreover, revealing the employer’s statements would conflict with the purpose of the confidentiality provision, which is to encourage employers to participate in voluntary settlements. Employers should be aware that any statements made during a Title VII “conciliation process” will remain confidential and cannot be disclosed in a subsequent action.

Supreme Court Holds FLSA Retaliation Provision Protects Oral Complaints

April 1, 2011 by Hinshaw & Culbertson LLP

An employee verbally complained to his employer about the location of the employer’s time clock. He contended that the employer unlawfully denied employees compensation for time spent donning protective gear required for the job by placing the time clock away from the dressing area. The employee “raised a concern” with his supervisor and expressed that “it was illegal for the time clocks to be where they were.” He further asserted that he “was thinking about starting a lawsuit about the placement of the time clocks.” The employee was subsequently terminated. The employee sued, arguing that he was terminated in retaliation for “filing a complaint,” in violation of the Fair Labor Standards Act’s (FLSA) anti-retaliation provision. The employer argued that the anti-retaliation provision, which covers employees who have “filed any complaint,” only protects employees who have made a written complaint relating to the FLSA. The U.S. Supreme Court rejected the employer’s argument, holding that the FLSA’s anti-retaliation provision extends to oral complaints, such as those made by the employee. The Court found that the anti-retaliation’s purpose is to prevent “fear of economic retaliation from inducing workers quietly to accept substandard conditions.” That purpose would be inhibited if the FLSA only protected written complaints because some workers may be unable to reduce their complaints to writing. Furthermore, oral methods of receiving complaints, such as hotlines, would be ineffective and the use of informal workplace grievance procedures would be discouraged. Accordingly, the Court construed the “filed any complaint” provision broadly to cover oral as well as written complaints. Employers should note the Supreme Court’s ruling that the FLSA’s anti-retaliation provision affords the same protections as to oral complaints concerning alleged FLSA violations as it does for written complaints, and ensure that employees are not subject to adverse employment actions for making such complaints by either mode of communication.

EEOC Issues Final Regulations Implementing the ADA Amendment Act

April 1, 2011 by Hinshaw & Culbertson LLP

On March 24, 2011, the U.S. Equal Employment Opportunity Commission (EEOC) released long-awaited final regulations implementing the ADA Amendments Act (ADAAA). The ADAAA became effective on January 1, 2009. The final regulations implement the legislative intent of the ADAAA to make it easier for individuals with disabilities to obtain protection under the Americans with Disabilities Act (ADA). The ADAAA emphasizes that the primary focus in ADA cases should be on whether employers complied with their obligations under the statute and whether discrimination occurred, not whether individuals are disabled under the law. The regulations maintain this focus by retaining the broad definition of “disability.” More ›

Forum-Selection Clause in Employment Agreement Enforced in Title VII Case

April 1, 2011 by Hinshaw & Culbertson LLP

An employee signed an employment agreement with her employer. The agreement set the terms and conditions of the employee’s employment and included the following forum-selection clause: “The parties agree that all claims or causes of action relating to or arising from this Agreement shall be brought in a court in the City of Richmond, Virginia.” The agreement also included a choice of law provision designating Virginia law as controlling. Subsequently, the employee was terminated and she sued in Florida. The employee alleged that the employer unlawfully terminated her after she announced that she was pregnant, and that she was fired in retaliation for objecting to her employer’s unlawful conduct. The U.S. Court of Appeals for the Eleventh Circuit dismissed the employee’s claims because they were brought in an improper venue. The court held that all claims arising directly or indirectly from the employee’s employment relationship with the employer had to be brought in a court in Richmond due to the forum-selection clause in the employment agreement. This case exemplifies how forum-selection clauses allow employers to defend against potential lawsuits in the state they prefer.

Employee’s Leave in Order to go on “Faith Healing” trip not Protected Under FMLA

March 4, 2011 by Hinshaw & Culbertson LLP

An employer approved intermittent Family and Medical Leave Act (FMLA) leave for an employee to take care of her husband, who suffered from serious medical conditions. After three years of taking intermittent leave, the employee submitted a request to take a seven-week leave to travel with her husband on a faith-healing pilgrimage to the Philippines. The employer denied the leave based on an FMLA certification from the husband’s doctor stating that he was “presently . . . not incapacitated,” despite also receiving a doctor’s note indicating that the employee’s leave was needed so that she could physically assist her husband on the pilgrimage. When the employee failed to respond to the employer’s requests for her to return to work, the employer terminated her. The employee sued, asserting that the faith-healing pilgrimage constituted medical care under the FMLA, and that the employer’s actions constituted interference with her right to leave and retaliation in violation of the FMLA. The U.S. Court of Appeals for the First Circuit rejected the employee’s claims because: (1) no conventional medical treatment was provided to the employee’s husband during the trip; (2) the employee’s husband saw no doctors on the trip; and (3) during the trip, the employee and her husband prayed, went to Mass, spoke with others on the pilgrimage, and visited other churches and family. The court concluded that FMLA leave to care for an immediate family member does not extend to vacations during which no medical care is provided. The fact that the employee provided physical and psychological care to her husband was incidental to the vacation. This case serves as reminder that FMLA leave is meant for employees with serious health conditions or who care for a family member with a serious health condition. Accordingly, employers need not grant FMLA leave requests where the leave sought is actually a vacation.

Sick Leave Buy-Back must be Included in Calculation of “Regular Rate” for Overtime

March 4, 2011 by Hinshaw & Culbertson LLP

A city allowed employees who had accumulated a minimum amount of unused sick leave to sell it back to the city. The city did not, however, include buy-back payments when determining the regular rate of pay for purposes of calculating overtime pay. Under the Fair Labor Standards Act (FLSA), overtime hours must be compensated at a rate not less than 1.5 times the “regular rate” at which an employee is paid. The term “regular rate” includes “all remuneration paid” to an employee, with a few exceptions. The U.S. Courts of Appeals for the Sixth and Eighth Circuits are split on whether a sick leave buy-back payment must be included within an employee’s regular rate for overtime purposes. Noting the split, the U.S. Court of Appeals for the Tenth Circuit agreed with the Eighth Circuit and the U.S. Department of Labor in holding that such a payment must be included within the regular rate calculation. In so doing, the court stated that sick leave buy-backs represent compensation for additional service or value received by the employer and are analogous to attendance bonuses. Consequently, such payments must be included within the regular rate calculation. Interestingly, in the same opinion, the court held that vacation buy-backs do not need to be included within the regular rate calculation. Ultimately, this case demonstrates the complexities inherent in complying with wage and hour laws and that employers must carefully consider how the payment of bonuses and other forms of additional compensation impact the calculation of overtime payments to employees.

Search

Subscribe via Email

RSSSubscribe via RSS
TwitterFollow us on Twitter/X

Blog Editors

Blog Contributors

Archives