PA Employment Law

"Split Happens:" 3rd Circuit Finds Supervisors at Public Agencies Can Be Personally Liable for FMLA Violations

2012-02-01T10:00:00.000-05:00

Yesterday, in the case of Haybarger v. Lawrence County Adult Probation and Parole, the Third Circuit Court of Appeals determined, for the first time in this Circuit, that supervisors who work at public agencies can be held personally liable for violations of the Family and Medical Leave Act (FMLA).

The facts of this case and the analysis employed by the Court in reaching its decision are not overly exciting. In short, Debra Haybarger worked as an office manager for Lawrence County Adult Probation and Parole, and suffered from Type II diabetes, heart disease and kidney problems. Her health problems forced her to miss work often for medical appointments, and the Director of the Adult Probation and Parole, William Mancino, expressed dissatisfaction with Haybarger's frequent illness-related absences. Mancino informed Haybarger that she needed to "cut down" on the days she was taking off and began to ask her why she needed to visit the doctor so much. Haybarger was then formally disciplined by Mancino for her frequent medical absences and eventually terminated by the Adult Probation Office on Marcino's recommendation. Haybarger then sued Lawrence County, Lawrence County Adult Probation and Parole and Marcino for various employment law violations, including the FMLA.

After a complex procedural history, which saw many of Haybarger's claims dismissed, Marcino sought to have Haybarger's FMLA claims against him dismissed as well, arguing that the statutory language of the FMLA did not allow for personal liability. After engaging in a thorough (and none-too-thrilling) parsing of the operative statutory language that defines who is an "employer" under the FMLA, the Third Circuit concluded that this definition includes an individual employed by a public agency who (1) exercises supervisory authority over a complaining employee and (2) was responsible, either in whole or in part, for the alleged FMLA violation. The Third Circuit then examined the specific facts in this case and concluded that enough evidence existed to allow a jury to conclude that Marcino fit this definition as it related to Haybarger.

What really makes this case interesting and important (aside from the fact that this issue had never been decided by the Third Circuit before), is that it widens a Circuit-split that previously existed on this question. In its decision, the Haybarger Court noted that the Sixth and Eleventh Circuits had already arrived at the opposite conclusion - that the FMLA does not permit individual liability for supervisors at public agencies. Additionally, the Eleventh Circuit has similarly held that there is no individual liability for public officials under the FMLA because "an individual officer lacks sufficient control over an employee's employment." The Haybarger Court, however, rejected these rationales and instead chose to follow the lead of the Fifth Circuit, which had previously concluded that individual liability under the FMLA can attach to supervisors at public agencies.

So, we now have at least three Circuits finding no grounds for individual public supervisor liability, and at least two that have taken the opposite tack. With that schism, it seems likely (if not inevitable) that the U.S. Supreme Court will now have to take up this question and determine it once and for all. As they say in show business, "stay tuned folks... there's more after this."

You can read the full Third Circuit opinion in Haybarger v. Lawrence County Adult Probation and Parole here: http://www.ca3.uscourts.gov/opinarch/103916p.pdf

US Supreme Court: First Amendment Bars Discrimination Suits By Ministers Against Religious Employers

2012-01-12T09:44:00.000-05:00

Yesterday, in the case of Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC, the U.S. Supreme Court, for the first time, adopted and sanctioned the "ministerial exception" rule that has been utilized by the Federal Courts of Appeals for 40 years, which provides that the Free Exercise and Establishment Clauses of the First Amendment prohibit ministers, priests, and other religious individuals from suing their ecclesiastical employers for employment discrimination. In short, the Court held that the First Amendment's prohibition on the government's establishment of religion and its guarantee of free exercise and worship prohibit such lawsuits because religious organizations are free to choose which ministers they want to lead and guide their congregation, without interference or the threat of forced-reinstatement or monetary damages imposed by the courts or the government.

This case centered around Cheryl Perich, who was a "called" teacher of students from kindergarten to eighth-grade for the Hosanna-Tabor Church. The Church has two categories of teachers that it employs: "called" teachers and "lay" teachers. "Called" teachers are required by the Church to complete certain academic requirements, including an eight-class course of theological study at a Lutheran college or university, an endorsement of the teacher's local Church district, and the successful passage of an oral examination by Church faculty. Once these requirements are met, the teacher may be "called" by the congregation, upon which the teacher formally receives from the Church the title of "Minister of Religion, Commissioned." "Lay" teachers, on the other hand, are not required to be Lutheran or to be trained by the Church. The Church only appoints "lay" teachers when no "called" teachers are available.

Perich, as a "called" teacher, had completed all of the above requirements, and taught both religious and secular curriculum to her students at the Church. Her duties also involved activities such as leading students in prayer exercises daily, attending weekly school-wide chapel services and even leading those chapel services approximately twice each year.

In June of 2004, Perich was diagnosed with narcolepsy, and began the 2004-2005 school year on disability leave. On January 25, 2005, Perich notified the school principal that she was ready to return to work. The principal, however, informed Perich that the school had already contracted with a "lay" teacher to fill Perich's position, expressing concern that Perich would not be able to return to the classroom. On January 30, the Church held a congregation at which the school's administrators concluded that Perich was physically unable to return to her job either that school year or the next, and requested that Perich resign from her position as a "called" teacher.

Perich refused to resign and produced a note from her doctor indicating that she would be physically able to return to work on February 22, 2005. On that date, Perich arrived at the school and the principal asked her to leave. Later that day, the principal telephoned Perich and told her that she was likely going to be fired. Perich responded that she had contacted an attorney and intended to pursue her legal rights.

On April 10, 2005, a congregation of the Church was convened, and voted to rescind Perich's call in light of the "regrettable" actions that had occurred in February. The next day, the school board terminated Perich's employment on the grounds of "insubordination and disruptive behavior," and because of the damage she had done to her "working relationship" with the school by "threatening to take legal action."

Perich then filed a Charge of Discrimination with the EEOC, alleging that she had been terminated from her employment in violation of the Americans with Disabilities Act (ADA). Perich claimed that the Church had unlawfully retaliated against her for threatening to file a lawsuit under the ADA in February of 2005.

In a unanimous 9-0 decision, the Supreme Court held that Perich's suit, which originally sought reinstatement to her position as a "called" teacher, or alternative damages for back-pay, front-pay and punitive damages, was barred by the First Amendment's ministerial exception. Chief Justice John Roberts, in writing for the Court, engaged in detailed examination of the history and origination of the First Amendment's Free Exercise and Establishment Clauses, and found that they had been adopted against the backdrop of the British Crown's historical interference and control over the appointment of ecclesiastical ministers.

The Court also noted that its own past decisions have reinforced the rule that governmental actions that have the effect of contradicting or interceding in a religious organization's decision as to who shall serve as a minister and under what conditions or circumstances, are unconstitutional under the First Amendment. The same holds true, the Court concluded, with employment discrimination actions brought by ministers against their former religious employers. The Court held that: "[r]equiring a church to accept or retain an unwanted minister, or punishing a church for failing to do so, intrudes upon more than a mere employment decision. Such action interferes with the internal governance of the church, depriving the church of control over the selection of those who will personify its beliefs. By imposing an unwanted minister, the state infringes the Free Exercise Clause, which protects a religious group's right to shape its own faith and mission through its appointments."

Finding that Perich was clearly a minister under the facts and circumstances surrounding her acceptance as a "called" teacher, and the fact that both Perich and the Church had held her out to the public as a minister during the years of her employment, the Supreme Court dismissed Perich's claim for retaliation under the ADA as unconstitutional.

You can read the Supreme Court's full opinion in Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC here: http://www.supremecourt.gov/opinions/11pdf/10-553.pdf

Filming Co-workers In Partial State of Undress is Bad.... In Case You Didn't Know

2011-10-14T16:34:00.000-04:00

In the legal world, common sense and the law do not always go hand-in-hand. Sometimes what seems practically logical or predictable will not be legally sustainable (or vice-versa). But, on those rare occasions when the law and common sense can exist side-by-side without destroying each other like sparring gladiators, it can be refreshing.

This is one of those moments. In the recent case of Jane Doe v. Luzerne County, the Third Circuit Court of Appeals reversed a trial court's dismissal of a claim brought by a deputy sheriff who alleged that her supervisors and co-workers in the Luzerne County Sheriff's office violated her Right to Privacy under the Fourteenth Amendment when they surreptitiously videotaped her partially nude, showed the video and still photographs to other co-workers in the department, and then stored the files on a county computer where any county employee who had access to the network could find and view them. The district court had thrown out Jane Doe's Right to Privacy claim, finding that while the actions of Doe's supervisor and co-worker in making the video, were "likely ill-conceived and definitely poorly executed," they did not "fall within the zone of privacy protected by the Fourteenth Amendment." (Yes, you read that correctly).

One day, Jane Doe, a Luzerne County deputy sheriff, and her partner entered a residence to serve a bench warrant, only to discover the inside of the residence strewn with garbage and at least one dead animal (a cat) observed on the floor. Doe and her partner soon found themselves crawling with fleas. They radioed back to the Sheriff's Department for instructions on how to handle the flea exposure, and were told to proceed to a local Emergency Management Building (EMB), and wait there in their police cruiser until EMB personnel could construct a temporary decontamination shower and until their supervisors arrived.

After arriving at the EMB, Doe and her partner were met by Arthur Bobbouine, Chief Deputy of the Department and Deputy Ryan Foy, both of whom were Doe's supervisors. Foy brought a video camera and immediately began to film Doe and her partner, who were still sitting in their police cruiser with the windows rolled up. Foy testified that he was videotaping the proceedings for training purposes, and both Bobbouine and Foy instructed Doe and her partner that they had to remain inside the cruiser until the decontamination shower was constructed.

Unfortunately, the EMB personnel were unable to construct the decontamination shower, so Bobbouine instructed Doe and her partner to drive to a nearby hospital, which was equipped with a decontamination facility. After getting to the hospital and sitting in the cruiser for another forty-five minutes (as ordered), Doe finally entered the hospital with Foy videotaping her the entire way. Doe testified that throughout her time in the cruiser, both at the EMB and the hospital, and during her walk into the hospital, she repeatedly asked Foy to stop filming, but he refused, stating it was for training purposes.

Doe proceeded to the decontamination shower room, closed the door behind her, undressed and showered without incident. When she finished showering, however, she noticed that there were no towels in the decontamination area - only a roll of thin tissue paper, of the kind that covers examination tables in doctors' offices. A female Sheriff's Deputy, Joyce, instructed Doe through the closed door to wrap the hospital paper around her private areas so that Joyce could enter the room, examine Doe and ensure that all of the fleas had been removed. Doe wrapped the paper around her private areas, but testified that either the paper itself was semi-transparent, and/or that her wet body caused the paper to become semi-transparent after she wrapped it around herself.

Joyce entered the decontamination room, and closed the door behind her, but was unable to lock it, as the door was not equipped with a lock. With Doe standing with her back to the door, Joyce began to inspect Doe for fleas. Doe testified that at this point, most of her back, shoulders and legs were completely exposed, with only the semi-transparent paper wrapped around her buttocks and breasts.

As Joyce was examining Doe for fleas, Foy opened the door to the decontamination room approximately one foot and began surreptitiously filming Doe. Doe was then startled to hear Bobbouine's voice behind her saying "What's that shit all over your back?" in a reference to Doe's back tattoo. Doe instinctively turned, saw the two men and yelled at them to leave the decontamination room. Doe later testified that the video captured someone saying that he could see her "boobies," and that somebody should grab something to "cover [Doe] up." Doe also testified that her buttocks were visible through the wet paper and that Bobbouine had made a statement (also allegedly captured on video) that he "could see [Doe's] ass."

Joyce again closed the door to the decontamination room behind the men, and finished her examination of Doe. After which, Doe left the hospital in scrubs.

Later that same day, Foy uploaded the video he took of Doe onto his County work computer and showed the footage to several male and female officers. At least one officer testified that Foy had displayed a still image of Doe's bare buttocks. Foy then saved several still images (including one showing the tattoo on Doe's back) and the video he took that day in a public computer file, entitled "Brian's ass," which Doe testified could have been viewed by anyone who had access to the Luzerne County computer network. Of the two still images Foy saved that depicted Doe, both showed the visible outline of her buttocks, covered only by thin, wet hospital paper.

Doe sued the County, claiming that the actions of Foy and Bobbouine violated not only her Right to Privacy under the Fourteenth Amendment, but also her right to be free from unreasonable searches and seizures under the Fourth Amendment. Doe also claimed that the County was liable for an alleged failure to train their officers.

On appeal, the Third Circuit held that, on these facts, the district court committed error by dismissing Doe's Right to Privacy claim. While noting that "the issue of whether one may have a constitutionally protected privacy interest in his or her partially clothed body is a matter of first impression in this circuit," the Court unambiguously found that "Doe had a reasonable expectation of privacy while in the Decontamination Area, particularly while in the presence of members of the opposite sex," and that the facts did not "support the assertion that Doe expressly or implicitly consented to Bobbouine and Foy opening the door or filming the events inside the Decontamination Area." The Court noted that there was also a dispute of material fact as to which of Doe's body parts were exposed to Bobbouine and Foy - Doe had presented evidence that her unexposed breasts and buttocks were revealed to Bobbouine and Foy, while the County had argued that only Doe's back, shoulders, arms and legs were exposed. As such, the Court determined that dismissal of Doe's claim in light of this factual dispute was improper.

The Court also found that the following factors all weighed in favor of finding a Right to Privacy for Doe under these circumstances: (1) the video and pictures may have included images of Doe's exposed breasts and/or buttocks; (2) the potential harm to Doe of dissemination of non-consensual disclosure of those images or video over the Internet was great; (3) the context of the disclosure of the video and images at her work and to her co-workers could increase the harm suffered by Doe; and (4) there were inadequate safeguards imposed against non-consensual disclosure because Foy had uploaded the video and images to a public file where anyone with network access could view them.

Consequently, the Court remanded the case back to the trial court and allowed Doe's Right to Privacy claim to continue.

So, in case anyone out there was fuzzy on this issue, videotaping your co-workers partially nude is a no-no.

You can read the Third Circuit's full opinion in Doe v. Luzerne County here: http://www.ca3.uscourts.gov/opinarch/103921p.pdf

Legal Challenge to Haverford Township Anti-Discrimination Ordinance Continues

2011-10-10T09:04:00.000-04:00

Back on February 15, I reported on the new anti-discrimination ordinance passed by Haverford Township in Delaware County, PA, which not only makes it illegal for employers doing business in Haverford Township to discriminate against employees or applicants on the grounds of sex, religion, race and national origin, but also added sexual orientation, gender identity and gender expression as protected classes - something that neither Pennsylvania nor the Federal Government has yet to do.

Since then, a Haverford Township resident, Fred Teal, has filed a lawsuit challenging the validity of that Ordinance, arguing it is illegal because the Township allegedly failed to follow the proper procedures in adopting it. Mr. Teal has also argued that two of the Haverford Township Commissioners should have recused themselves from the proceedings surrounding the adoption of the Ordinance because they have homosexual relatives.

The Delaware County Daily Times is reporting that on September 27, 2011, Judge Pagano of the Delaware County Court of Common Pleas overruled the Township's preliminary objections to Mr. Teal's action, which means that for the moment, the lawsuit will continue. The Township must now file an Answer to Mr. Teal's Complaint.

You can read the full story from the Delaware County Daily Times here: http://delcotimes.com/articles/2011/10/10/news/doc4e92630eb4ce5699604790.txt?viewmode=fullstory

In Title VII Cases, Sometimes It's All About the Numbers. . .

2011-10-04T09:44:00.000-04:00

On September 28, 2011, in the case of Meditz v. City of Newark the Third Circuit Court of Appeals found that the trial court had improperly dismissed a lawsuit against the City of Newark, which alleged that the City's residency requirement for its non-uniformed employees was unlawful under Title VII because it created an employment bias against white, non-Hispanic applicants. The Court of Appeals held that the trial court had failed to properly evaluate and consider the weight of the statistical evidence that had been presented by the plaintiff. In April of 2007, Gregory Meditz, a white male who resided in neighboring Rutherford, New Jersey, applied for a non-uniformed job with the City of Newark. Meditz was turned down for the job because he did not live in the City of Newark, and thus did not qualify for employment under a City Ordinance that required all non-uniformed City personnel to live within the City limits. Meditz sued, claiming that the City's residency requirement for its non-uniformed employees was discriminatory and unlawfully barred him from qualifying for a non-uniformed job with the City. Specifically, Meditz argued that the residency requirement worked a disparate impact on white, non-Hispanic job applicants because the racial make-up of the population of Newark did not reflect the racial make-up of the surrounding labor market. In support of his claims, Meditz produced statistical data that he gathered from publicly available sources, which revealed that in 2007, only 9.4% of the non-uniformed employees of the City of Newark were white, non-Hispanic, while 28.31% of the City's uniformed employees (who are not subject to a residency requirement) were white, non-Hispanics. Meditz also compared the statistics of the racial composition of the City's non-uniformed employees with the racial composition of the non-uniformed employees from the County of Essex, which maintained its County seat within the City of Newark. This comparison showed that 42.96% of the non-uniformed employees who worked for the County were white, non-Hispanics. Meditz also introduced evidence that in 2005, the percentage of white, non-Hispanics that constituted the non-uniformed employees of Essex County and 5 neighboring counties, ranged from 48.09% to 86.49%, with the percentages of white, non-Hispanics employed in the private labor force in those same counties being only slightly lower. The trial court, however, granted the City's motion for summary judgment, and tossed Meditz's lawsuit, concluding that "these statistics, standing alone, do not constitute sufficient evidence of a significantly discriminatory hiring pattern."On appeal, the Third Circuit reversed, finding that the trial court had misapplied the law and had failed to lend the appropriate weight to Meditz's statistical evidence. Specifically, the Court held that "Meditz offered statistical evidence showing that the percentage of white, non-Hispanics employed by Newark was lower than the population of white, non-Hispanics in the general population of Newark. Meditz also offered statistics showing the percentage of white, non-Hispanics in surrounding areas both for the general population and for the private and government work forces. Finally, Meditz offered evidence of the percentage of white, non-Hispanics employed by the Essex County government in Newark. Out of all these percentages, the lowest was the percentage of white, non-Hispanics employed by the City of Newark. This compilation of statistics supported Meditz's claim that white, non-Hispanics were under-represented in Newark's non-uniformed work force." This case provides an excellent illustration of how a disparate impact theory of discrimination under Title VII can be invaluable tool for an individual who believes he or she has been subjected to unlawful discrimination, because in these cases, evidence of discriminatory intent or bias on behalf of the employer is not required. All that a plaintiff needs in order to be successful is to establish a differential employment outcome or treatment that is based upon race, sex, religion, or national origin, which can be proven through statistical analysis and statistical deviations. After all, the numbers don't lie. You can read the Third Circuit's full opinion in Meditz v. City of Newark here: http://www.ca3.uscourts.gov/opinarch/102442p.pdf

Supervisor who is terminated for asking subordinates for a loan is not entitled to unemployment compensation

2011-08-25T08:40:00.002-04:00

In Weingard v. Unemployment Compensation Board of Review, No.: 2729 C.D. 2010 (Pa. Cmwlth. 8/10/2011), the Commonwealth Court held, in a matter of first impression, that a supervisor who is fired for requesting a substantial loan from a subordinate is not entitled to receive unemployment compensation, even if the employer does not have a specific rule prohibiting the solicitation of loans in the workplace. The Court held that such a request constitutes a disregard of the standards of behavior an employer has a right to expect from its employees.

In this case, Weingard learned that a co-worker was selling a motorcycle for $1,000.00 and he wanted to buy it. But, due to his poor credit history, Weingard knew that he would be unable to obtain a loan from a bank. So, Weingard asked his supervisor for a $1,000.00 loan and was turned down. Weingard then asked five other employees - at least one of whom was Weingard's subordinate - if he could borrow the $1,000.00 and was similarly rejected. One of the employees who was supervised by Weingard complained to Weingard's supervisor about Weingard's request to borrow money, indicating that it made her uncomfortable. The employer conducted a three-week investigation into the matter, after which it terminated Weingard for his requests to borrow money, deeming such an action to be "coercive."

The employer's handbook did not contain any specific rules regarding the lending or borrowing of money between supervisors and subordinates, but did prohibit employees from "operating or acting in any manner that is contrary to the best interests of Employer."

Weingard then filed for unemployment compensation benefits. The Unemployment Compensation Referee granted benefits to Weingard, finding that the employer had failed to meet its burden to establish the existence of a rule regarding the lending or borrowing of money between supervisors and subordinates, and that a violation of that rule could result in termination.

On appeal, the Unemployment Compensation Board of Review reversed, holding that the employer had in fact established the existence of a policy that prohibited Weingard from acting in a manner that was contrary to the employer's best interests. The Board thus denied Weingard unemployment compensation benefits.

The Commonwealth Court affirmed the decision of the Board that denied Weingard unemployment compensation benefits, but did so on different grounds. The Court found that employer's general policy that prohibited employees from "operating or acting in any manner that is contrary to the best interests of Employer," was "so general as to be meaningless to this appeal." The Court held that the Board committed error when it found that Weingard had knowingly violated this vague standard because "[Weingard] testified that he did not know there was a policy prohibiting him from soliciting loans from co-workers, and he did not believe that asking another employee for a loan harmed Employer's interest in any way. Employer provided no evidence to the contrary." Thus, the Court found the Board's conclusion that Weingard had committed willful misconduct by knowingly violating a work rule, was erroneous.

The Court nevertheless determined that Weingard was ineligible to receive unemployment compensation benefits. Examining for the first time whether a supervisor's request of a substantial loan from a subordinate constitutes willful misconduct, the Court found that in asking to borrow $1,000.00 from a subordinate, "[Weingard] used his position of authority in an unseemly way. He may not have used overt threats or direct coercion, but that fact is not dispositive of the issue. [Weingard] held the upper hand in the relationship with the employees he supervised. . . There is an unspoken, and implicit, coercion when a boss makes a request for a significant loan of an employee under his supervision." Therefore, the Court concluded that while Weingard may not have violated a specific written rule of his employer regarding money-lending between employees, his conduct "violated the standards of behavior his Employer had a right to expect," from its employees, which constituted willful misconduct that disqualified him from receiving unemployment compensation benefits.

The moral of the story? If you need a loan, go to a bank.

You can read the WeingardCourt's full opinion here: http://www.courts.state.pa.us/OpPosting/Cwealth/out/2726CD10_8-10-11.pdf

Vote for "Pa Employment Law" as one of ABA's top 100 blawgs for 2011!

2011-08-20T10:06:00.000-04:00

The American Bar Association is one again compiling its list of the top 100 legal blogs in the country and is looking for nominations.

If you like "Pa Employment Law" then please take a few minutes and vote!

Just click on this link: http://www.abajournal.com/blawgs/blawg100_submit/, fill out the short form and click submit!

Thanks!!

Think supervisors and employers are immune from retaliation claims because employee discipline is recommended by an internal review committee? Think again.

2011-08-18T16:04:00.000-04:00

In McKenna v. City of Philadelphia (8/17/2011) the Third Circuit Court of Appeals held that the Philadelphia Police Department's use of an internal disciplinary review committee to recommend an officer's termination did not insulate that officer's supervisor, or the City itself, from charges of unlawful retaliation and termination. In so doing, the Court analyzed and applied the recent decision of the U.S. Supreme Court in Staub v. Proctor Hospital, in which the Court held that an employer may be held liable for unlawful discrimination based upon the discriminatory motivation of an employee who influenced, but did not make, the ultimate adverse employment decision. (To read more about the Staub decision, see my earlier post on this blog here: http://paemploymentlaw.blogspot.com/2011/03/us-supreme-court-adopts-cats-paw-theory.html

McKenna involved a former Caucasian Philadelphia police officer, Raymond Carnation, who testified that he used to work in a police squad that experienced significant internal racial tensions. Shortly after Sgt. John Moroney was named as the permanent supervisor of Carnation's squad, Carnation complained to Moroney of the issues involving racial tensions within the squad. Carnation also complained to the local district commander, Captain William Colarulo, about the racial tensions. When nothing appeared to be happening to change the environment within the squad, Carnation told Colarulo that he thought Moroney was condoning racism by failing to address the issues Carnation had complained of. Carnation also told Moroney that he thought Moroney was contributing to the problems by failing to take action.

As a direct consequence of making these complaints, Carnation testified that he was subjected to retaliation, such as being assigned unassisted duty in dangerous neighborhoods in unpleasant weather conditions. In another instance, Carnation testified that Colarulo told him that if Carnation filed an EEOC complaint, Colarulo would make Carnation's life "a living nightmare," and ordered Carnation to apologize for making his previous accusations.

In May of 1997, Carnation attempted to call Moroney at the district, in order to speak with him. Carnation received a telephone call back from Colarulo, who ordered Carnation to "not call Sgt. Moroney." The next Saturday, however, Carnation called Moroney and spoke with him about his concerns surrounding the racial issues in the squad. The next day, Carnation called Colarulo, who was off duty and on vacation for the Memorial Day holiday, and told Colarulo that he had spoken to Moroney and resolved many of his concerns, but still wanted to schedule a meeting between all three of them. Colarulo refused to schedule a meeting.

After the Memorial Day holiday, Colarulo served Carnation with disciplinary papers relating to the phone calls that had been placed over the weekend, and brought charges of insubordination, using profane or insulting language to a superior officer, and neglect of duty for failing to comply with oral orders of a superior, against Carnation.

As per Philadelphia Police Department procedures, the charges were then sent to an internal disciplinary board called the "Police Board of Inquiry" or "PBI." The PBI is a three-member panel of police officers, which listens to the evidence before it and then decides what proper sanction, if any, that it will recommend to the Police Commissioner, who holds the power to impose any recommended sanctions.

Carnation pled "not guilty" to the charges against him, and a hearing was held before the PBI, at which Carnation was represented by private counsel, and testified on his own behalf, as did Colarulo. The PBI found Carnation guilty of all three counts brought by Colarulo and, on its own initiative, added a fourth charge of conduct unbecoming an officer. The PBI then recommended Carnation's termination to the Police Commission, who approved the same.

Carnation subsequently filed suit against the City of Philadelphia, alleging unlawful retaliatory termination in violation of Title VII. The jury found that Carnation's termination constituted illegal retaliation that stemmed from his protected activity of complaining about racial discrimination to Colarulo and Moroney during the Memorial Day weekend, and awarded Carnation $2,000,000.00 in compensatory damages.

The City appealed from the district court's decision upholding the jury verdict, arguing that the City could not be held liable for any retaliatory animus held by Colarulo against Carnation, as a matter of law, because Carnation's termination was not carried out by Colarulo. Rather, Carnation's termination was carried out by a separate, internal disciplinary board that made its recommendation to dismiss Carnation only after receiving testimony and evidence in an unbiased, neutral due-process hearing.

The Court of Appeals disagreed and affirmed the jury's verdict against the City. The Court rejected the City's arguments that the use of the PBI insulated the City and Colarulo from liability as a matter of law. Specifically, the Court recognized that in Staub, the Supreme Court held that the test for analyzing whether an employer can be held liable for the discriminatory or retaliatory animus of a non-decisionmaker was not whether the non-decisionmaker exerted "singular influence," over the eventual adverse employment action, but rather whether the non-decisionmaker's animus was the "proximate cause," of the adverse employment action suffered by the employee. The Third Circuit noted that "proximate causation requires only some direct relation between the injury asserted and the injurious conduct alleged and excludes only those links that are too remote, purely contingent, or indirect." The Court held that the record in this case was insufficient to establish that the PBI's role in Carnation's dismissal rose to such a superseding level that it rendered any retaliatory animus harbored by Colarulo remote, purely contingent or indirect. Rather, the Court held that on the evidence presented, the jury was justified in finding that Colarulo's retaliatory animus "bore a direct and substantial relation to Carnation's termination and that the PBI's recommendation was not independent and was foreseeable." This conclusion was further supported by the Staub decision, in which the Supreme Court itself noted that "[a] supervisor's biased report may remain a casual factor if [an] independent investigation takes it into account without determining that the adverse action was, apart from the supervisor's recommendation, entirely justified. . ."

This case illustrates that, following the rule set forth by the Supreme Court in Staub, an employer cannot rely upon the use of an internal disciplinary review process to always insulate it from liability for discrimination or retaliation under Title VII, even when the individuals who participate in the review process have no relation to the employee or to the supervisor who may have recommended disciplinary action.

To read the Third Circuit's full opinion in McKenna v. City of Philadelphia, click here: http://www.ca3.uscourts.gov/opinarch/093567p.pdf

U.S. Supreme Court: Wal-Mart Class Action Too Big; No Commonality

2011-06-20T15:47:00.001-04:00

In the closely watched case of Wal-Mart Stores, Inc. v. Dukes, et al., the U.S. Supreme Court on Monday torpedoed what would have been the largest class-action lawsuit in American history against the nation's largest private employer.

In a 5-4 decision, the Court held that the proposed class, which would have consisted of approximately 1.5 million current and former female employees of Wal-Mart, who have alleged the presence of a corporate culture of gender and sex discrimination against women, failed to meet the "commonality" requirement for permissible class certification.

"Commonality" is a prerequisite set forth in the Federal Rules of Civil Procedure, which requires that there exist "questions of law or fact common to the class," before a group may properly be certified as a class. One of the tests by which commonality may be established is by setting forth "significant proof" that an employer "operated under a general policy of discrimination."

In short, the majority held that significant proof of a "general policy of discrimination" on behalf of Wal-Mart was entirely absent in this case. The majority noted that not only was plaintiff's sociological expert unable to provide a definitive opinion on this issue, but also that Wal-Mart's corporate policy is to provide each of its local supervisors with discretion over employment matters - a policy that is, by definition, the opposite of having the type of uniform employment practice that is needed to establish commonality for purposes of class certification.

The majority also held that the plaintiffs had failed to identify and challenge a specific employment practice that was alleged to be discriminatory and which was common to all 1.5 million class members.

The Court's decision to deny certification in this case is significant in that it will have a significant impact upon future discrimination claims against large employers, undoubtedly making it harder for plaintiffs to achieve class-status. Class-actions are, in many instances, the only real vehicles by which discriminatory policies or actions by large or multi-national employers can be successfully challenged. As compared to small, individual claims, class-actions with numerous class members often carry with them the prospect of very large verdicts that can quickly change (or destroy) a corporate image and bottom-line. Additionally, the economics of many discrimination claims (such as wage-and-hour claims) are simply not worth an attorney's time or money prosecuting on behalf of a single employee, as the potential recoverable damages often cannot justify the time and expense necessary to prevail through trial. Unfortunately, if class-actions now become harder to certify and maintain following this case, the sad truth is that many instances of discrimination or employment law violations may simply go unchecked or unchallenged.

You can read the Supreme Court's full opinion in Wal-Mart Stores, Inc. v. Dukes, et al. here: http://www.supremecourt.gov/opinions/10pdf/10-277.pdf

U.S. Supreme Court: Complaints By Public Employees Under Constitution's "Petition Clause" Only Protected If Related To Matters of Public Concern

2011-06-20T15:16:00.000-04:00

In Borough of Duryea v. Guarnieri, the U.S. Supreme Court held that a public employee who makes a complaint to a governmental employer under the "Petition Clause" of the U.S. Constitution is only protected from retaliation where the petition involves a matter of public concern. This decision harmonizes public employee complaints under the First Amendment's "Petition Clause" with prior Supreme Court decisions involving public employee complaints under the First Amendment's "Free Speech" clause.

The First Amendment to the U.S. Constitution protects "the right of the people. . . to petition the Government for a redress of grievances," (called the "Petition Clause") as well as the people's right to "freedom of speech (called the "Speech Clause)." This case concerned the extent to which public employees are protected by the Petition Clause when they make routine complaints to governmental employers.

Guarnieri was a police chief for a local borough in Pennsylvania, who filed a union grievance against the borough, challenging his termination. Following a subsequent arbitration, Guarnieri was ordered to be reinstated by the borough. After his reinstatement, borough council issued 11 written directives to Guarnieri concerning the performance of his duties. Guarnieri then filed a lawsuit against the borough, arguing that his original union grievance was a "petition" that was protected by the First Amendment's Petition Clause, and that the 11 directives that were subsequently issued by borough council were issued illegally in retaliation for Guarnieri's protected activity in filing a petition.

Diverging from the decisions of other Circuits, the Third Circuit Court of Appeals agreed, and held that Guarnieri's petition (in the form of his union grievance), was protected under the Petition Clause, even if the content of that petition did not address a matter of public concern.

The U.S. Supreme Court disagreed, and reversed the decision of the Third Circuit. In a 7-2 decision, with Justice Thomas filing a concurring opinion and Justice Scalia filing an opinion concurring in part and dissenting in part, the Court held that in order to find protection for complaints to governmental employers filed under the Petition Clause, public employees must be petitioning about a matter of public concern. The majority opinion noted that public employees who complain to their governmental employers enjoy protection from retaliation under the First Amendment's Speech Clause only where their complaints involve "matters of public concern," as opposed to matters of "purely private concern." Given this premise, the majority found no distinguishing reason to treat a public employee's "petition" to a government employer under one section of the First Amendment differently from a public employee's "speech" under a different section of the First Amendment.

Therefore, the Court's majority laid down the following rule: "If a public employee petitions as an employee on a matter of purely private concern, the employee's First Amendment interest must give way, as it does in speech cases. When a public employee petitions as a citizen on a matter of public concern, the employee's First Amendment interest must be balanced against the countervailing interest of the government in the effective and efficient management of its internal affairs. If that balance favors the public employee, the employee's First Amendment claim will be sustained. If the interference with the government's operations is such that the balance favors the employer, the employee's First Amendment claim will fail even though the petition is on a matter of public concern."

You can read the Supreme Court's full decision in Borough of Duryea v. Guarnieri here: http://www.supremecourt.gov/opinions/10pdf/09-1476.pdf

U.S. Supreme Court: States May Revoke Business Licenses of Employers Who Knowingly Hire Illegal Aliens

2011-06-15T08:46:00.000-04:00

In the recent decision of Chamber of Commerce v. Whiting (5/26/2011) the U.S. Supreme Court upheld an Arizona law that: (1) allows the state to revoke the business licenses of private employers who knowingly or intentionally employ unauthorized aliens; and (2) requires all private employers to use the federal "E-Verify" system to confirm the immigration status of their employees. Following this decision, any other state in the nation may, if it chooses, adopt an employer-licensing law that provides for the same requirements and penalties as the Arizona statute.

The "Legal Arizona Workers Act of 2007" allows Arizona courts to suspend or revoke any necessary business licenses of private employers within Arizona if an employer knowingly or intentionally employs an unauthorized alien. The Act also requires that every private employer, after hiring a new employee, "shall verify the employment eligibility of the employee," using "E-Verify," which is federal internet database maintained by the federal government that allows an employer to receive basic information relating to an employee's work-authorization status. Use of the E-Verify system under federal level is strictly voluntary, as the Secretary of Homeland Security is expressly prohibited from requiring any person or entity outside of the federal government from participating in the E-Verify program.

The U.S. Chamber of Commerce and various other business groups sued various Arizona public officials charged with administering the Legal Arizona Workers Act of 2007, arguing that the law's provisions were both expressly and impliedly preempted by federal immigration law. After examining the statutory text and operations of both the federal immigration law and the Legal Arizona Workers Act, a 5-3 majority of the Court determined that nothing in the federal immigration law prevented Arizona from adopting, implementing and enforcing the Legal Workers Act as it had.

Going forward, the majority's sanction of the provisions of the Legal Arizona Workers Act opens the door for any other state that wishes to adopt the same manner of enforcement scheme, to pass their own statutes that are identical to Arizona's, without concern over whether it is constitutionally permissible to do so. Whether any states will choose to follow suit and create the same type of license-revocation sanction as exists under Arizona law for an employer's knowing and intentional employment of unauthorized aliens, remains to be seen.

You can read the Court's full opinion in Chamber of Commerce v. Whiting here: http://www.supremecourt.gov/opinions/10pdf/09-115.pdf

U.S. Supreme Court: Oral Complaints Are Sufficient To Invoke Anti-Retaliation Provisions of the Fair Labor Standards Act

2011-03-24T09:09:00.000-04:00

In Kasten v. Saint-Gobain Performance Plastics Corp., 09-834 (3/22/2011),the U.S. Supreme Court held that the anti-retaliation provision of the Fair Labor Standards Act (FLSA) protect employees who make oral complaints to an employer, when "a reasonable, objective person would have understood the employee to have put the employer on notice that the employee is asserting," his or her rights under the FLSA. This decision settles a disagreement that had existed among the Circuit Courts of Appeals as to whether oral complaints were sufficient, or whether the FLSA required an employee to file a written complaint before he/she could be protected from retaliation.

By way of background, the FLSA generally provides that employers that fall within its scope must pay non-exempt employees overtime pay at a rate of one-and-one-half the employee's regular rate of pay, for all hours that an employee works in excess of 40 in any week. Section 215(a)(3) of the Fair Labor Standards Act makes it illegal for an employer: "to discharge or in any manner discriminate against any employee because such employee has filed any complaint or instituted or caused to be instituted any proceeding under or related to [the FLSA], or has testified or is about to testify in such proceeding, or has served or is about to serve on an industry committee." 29 U.S.C. 215(a)(3). As mentioned above, the Courts of Appeals have been in disagreement as whether the phrase "filed any complaint," requires a formal written complaint, or encompasses informal oral complaints as well.

In this case, the employee, Kasten, had made various oral complaints to his employer about the physical location of time-clocks in his place of employment, which were located between the area where Kasten and his other co-workers would put on and take off their work-related protective gear, and the area where they performed their job duties. Kasten believed that this placement prevented the workers from receiving credit for time that they spent "donning and doffing" their required protective gear, which is a violation of the FLSA. Kasten claimed to have made repeated oral complaints about the time-clock location to his employer in accordance with the employer's internal grievance procedure, and orally complained to his shift supervisor that "it was illegal for the time clocks to be where they were," because of the employer's exclusion of "the time you come in and start doing stuff." Kasten also complained to a member of the HR department that if the location of the time clocks "were to get challenged," in court, the employer "would lose." He also told his lead operator that the location was illegal and that he "was thinking about starting a lawsuit about the placement of the time clocks."

Kasten alleged that these complaints led his employer to discipline, and ultimately, terminate him.

The lower courts had dismissed Kasten's claims of retaliation, holding that the FLSA did not protect "oral" complaints, but required an employee to file written complaints to an employer before he/she could take advantage of the FLSA's anti-retaliation provision.

The U.S. Supreme Court disagreed, and held that the FLSA's anti-retaliation provision protects both oral and written complaints. Finding that the text of the FLSA itself did not provide a conclusive answer to this issue, the Court's majority looked to the purpose and history of the FLSA, and concluded that limiting complaints by employees to only formal written complaints, would undermine the legislative purpose and intent of the Act, which was originally meant to protect illiterate and uneducated manufacturing laborers. The majority also noted that restricting complaints to only those in writing would prevent the Government agencies from using hotlines, interviews and other methods of receiving complaints from employees.

However, the Court did not go so far as to offer protection to all oral complaints, recognizing that the FLSA does require fair notice of alleged violations to be given to employers. Therefore, the majority held that while "fair notice" does not necessarily have to be in writing, an oral complaint will only be deemed to be "filed" under the anti-retaliation provision of the FLSA when "a reasonable, objective person would have understood the employee to have put the employer on notice that the employee is asserting," his or her rights under the FLSA. Under the facts of this case, the majority determined that Kasten's oral complaints to his employer and supervisors met this objective test, and thus allowed Kasten's suit to proceed.

You can read both the majority and dissenting opinions in Kasten v. Saint-Gobain Performance Plastics Corp., here: http://www.supremecourt.gov/opinions/10pdf/09-834.pdf

Store Manager Is FLSA Exempt, Says Employer. Not So Fast, Says Court.

2011-03-07T09:59:00.000-05:00

In Pierce v. Dolgencorp, Inc., the U.S. District Court for the Middle District of Pennsylvania held that a Store Manager's claim that she was owed unpaid overtime wages under the Fair Labor Standards Act (FLSA) could be sent to a jury for determination. In so doing, the Court rejected the employer's arguments that the Store Manager had to be classified as an "executive employee" as a matter of law.

Cindy Pierce was originally hired by Dollar General as a cashier in 1998. In 2001, she was promoted to Store Manager, and continued to work in that capacity until June or July of 2003. As a Store Manager, Pierce was the only salaried employee and the only employee who was classified as "FLSA exempt" by Dollar General.

As a Store Manager, Pierce had at least one Assistant Store Manager (ASM) and one clerk, and managed a store budget of over 200 hours per week. When she was first hired as Store Manager, Pierce earned $355.77 per week. By April, 2002, she was earning $423.08 a week, and understood that her salary was meant to compensate her for however many hours she worked. Pierce's ASM was paid $6.20 per hour. Pierce testified that she usually worked 50 to 60 hours a week, and sometimes as much as 65 hours a week. As Store Manager, Pierce interviewed and hired employees without approval from her District Manager, trained employees, disseminated and enforced corporate policies, evaluated employee performance, disciplined employees, fired and promoted employees, ensured store security and safety, monitored sales, damages, employees and hours, directed employees' work assignments and scheduled employees' hours. Pierce 30%-50% of her time performing paperwork, and it took her 5-6 hours just to complete the employees' work schedules. Pierce was unquestionably the store's leader.

On the other hand, Pierce testified that she spent 4 - 6 hours everyday stocking shelves and on "truck days," (which occurred about twice a week) Pierce and her ASM spent 75% of her time unloading and inventorying the delivery to the store. It would normally take two days to have delivery items unloaded and stocked on store shelves. She also ran the store registers when needed. Pierce had to request permission to take days off from her District Manager, and the store layout was dictated by a "planogram," that was created and disseminated by the District Manager. Pierce testified that she did not have discretion to set up the store as she would have liked. Pierce also spent 5 - 6 hours a week sweeping the floors and doing other non-managerial work. Pierce received excellent reviews in the area of "payroll control," which she attributed to her personally working more hours and not hiring extra employees.

In June of 2003, Pierce resigned from Dollar General because of stress associated with her job. In March of 2004, she made claims against Dollar General for unpaid overtime wages.

Dollar General (a.k.a. Dolgencorp, Inc.), argued that Pierce was not entitled to overtime pay for the period in which she served as Store Manager because she was properly classified as an "executive" employee, which is exempt from the overtime requirements of the FLSA. Dollar General argued that as Store Manager, Pierce's primary duty was management, and that she spent most of her time engaged in management work. Dollar General filed a Motion for Summary Judgment on this point, seeking dismissal of Pierce's claims.

The District Court disagreed, and held that Pierce had presented enough evidence to allow a jury to determine whether she spent most of her time performing managerial or non-managerial work. Specifically, the Court found that: (1) based on her testimony, a jury could determine that Pierce spent 25% - 30% of her time doing paperwork, and the remainder of her time performing manual labor; (2) a jury could conclude that Pierce's non-managerial work, such as unloading trucks, stocking shelves and running the registers, was more valuable to Dollar General than her managerial duties, because it saved Dollar General the expense of having to hire additional employees to perform the same work, evidenced by the fact that Dollar General refused to grant her more employees for her budget; and (3) when the respective hourly rate of pay of Pierce and her ASM is compared, a jury could find that Pierce was actually paid comparatively less than her ASM for an equivalent amount of hours (approximately 96% of her ASM's salary). Therefore, the District Court denied Dollar General's Motion and held that Pierce's claims must be determined by a jury.

The lesson to be learned from this case is clear: job titles are not everything. Just because someone holds a "manager" position does not mean that that individual is automatically exempt from the overtime pay requirements of the FLSA. Indeed, as this case shows, even performing some managerial tasks and duties in the course of employment does not entitle an employer to rely upon an "executive" exemption in every instance. As the District Court noted, the focus in these types of cases will be on the employee's "actual day-to-day activities, as opposed to generic job descriptions or performance evaluations." Things are not always as they seem at first glance.

US Supreme Court Adopts "Cat's-Paw" Theory In Military Discrimination Case

2011-03-02T09:06:00.001-05:00

In Staub v. Proctor Hospital, decided on March 1, 2011, the U.S. Supreme Court held, in the context of a case involving an employer's alleged violation of the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA), that "if a supervisor performs an act motivated by antimilitary animus that is intended by the supervisor to cause an adverse employment action, and if that act is a proximate cause of the ultimate employment action, then the employer is liable under USERRA." The significance of this opinion is two-fold: First, the Court through this opinion has explicitly sanctioned the applicability of "cat's-paw" theories of liability in an employment discrimination context. Second, there is nothing in the language of this decision that would suggest that the Court's analysis in this case is strictly confined to cases arising under USERRA. To the contrary, the Court itself acknowledges in the majority opinion that the operative statutory language of the USERRA, which prohibits an employer from denying employment or the benefits of employment to any person on the basis of that individual's membership in or obligation to a branch of the military, is "very similar to Title VII." As such, employees can now rely on this decision to advance "cat's-paw" theories of liability against employers in the traditional discrimination cases arising under Title VII.

In this case, Vincent Staub worked as a medical technician for Proctor Hospital under 2004 when he was terminated for allegedly violating a "Corrective Action" disciplinary warning that had been placed in his employment file by his supervisors, Janice Mulally and Michael Korenchuk.

While employed at Proctor, Staub was a member of the U.S. Army Reserve, which required him to attend drill one weekend per month and to train full time for two to three weeks per year. At Staub's subsequent employment discrimination trial, the jury determined that both Mulally and Korenchuk were hostile to Staub's military obligations. Specifically, Mulally had scheduled Staub for additional shifts without notice so that he would "pay back the department for everyone else having to bend over backwards to cover his schedule for the Reserves," and Mulally had also informed one of Staub's co-workers that Staubs's "military duty had been a strain on the department," and asked that co-worker to help her "get rid of" Staub. Korenchuk referred to Staub's obligations to the Reserves as "a bunch of smoking and joking and a waste of taxpayers' money," and was aware that Mulally was "out to get" Staub.

In January of 2004, Mulally issued Staub a "Corrective Action" disciplinary warning for purportedly violating a company rule that required him to stay in his work area whenever he was not seeing a patient. This warning required Staub to report to either Mulally or Korenchuk when he had no patients or when his patient testing was completed. Staub contended at trial that the company rule allegedly invoked by Mulally did not exist, and that even if it did, he did not violate it.

On April 2, 2004, one of Staub's co-workers complained to Proctor's vice-president of human resources, Linda Buck, and to Proctor's chief operating officer, Garrett McGowan, about Staub's unavailability and abruptness. McGowan directed Korenchuk and Buck to create a plan that would "solve Staub's availability problems." Before such a plan could be put in place, however, Korenchuk informed Buck that Staub had left his desk without informing a supervisor, in violation of his January Corrective Action notice. Relying upon this accusation (which Staub contended was entirely false), Buck reviewed Staub's personnel file and terminated him. Staub's termination notice stated that Staub had been terminated for violating the directive contained in Mulally's January Corrective Action notice.

Staub challenged his termination through Proctor's internal grievance procedures. Staub contended that his termination was improper because Mulally had fabricated the allegation underpinning the January Corrective Action notice due to her hostility towards his military obligations. Buck did not follow up with Mulally with respect to Staub's allegation, and did not reverse Staub's termination.

Staub then sued Proctor claiming a violation of the USERRA, alleging that his termination was illegal as it was motivated by hostility towards his U.S. Army Reserve obligations. Specifically, Staub argued that although Buck herself (who had actually terminated Staub), held no such hostility, Mulally and Korenchuk clearly did, and that "their actions influenced Buck's ultimate employment decision." Staub's claim proceeded to a jury trial, where the jury found in his favor and awarded him $57,640.00 in damages.

On appeal, the Seventh Circuit Court of Appeals reversed, holding that a "cat's-paw" theory of liability, such as the one that Staub had advanced in this case, could not be maintained unless the non-decisionmaker had exercised "singular influence," over the actual decisionmaker so that the decision to terminate was the "product of blind reliance." The Seventh Circuit held that since the evidence in this case showed that Buck was not "wholly dependent" upon either Mulally's or Korenchuk's advice, Staub had no cause of action under USERRA.

In a unanimous decision with two Justices concurring in the judgment, the Supreme Court reversed. The Court noted recognized that when creating a tort action under federal law, Congress "adopts the background of general tort law," including the concept of "proximate cause." In claims for intentional torts, for example, the Court noted that in order to be found liable, an individual must intend not only "the act itself," but "the consequences of the act." Therefore, adopting these tenets and applying them to the operative language of the USERRA statute, the Court held that: "if a supervisor performs an act motivated by antimilitary animus that is intended by the supervisor to cause an adverse employment action, and if that act is a proximate cause of the ultimate employment action, then the employer is liable under USERRA." As such, in order to prevail in such actions, a plaintiff cannot hold an employer liable simply by showing that the ultimate decisionmaker relied upon information that was (unbeknownst to the decisionmaker) prompted by discrimination. Rather, the plaintiff must prove that the originator of that discriminatory information created the information with the intent that such information would cause the plaintiff to suffer an adverse employment action.

The Court rejected Proctor's suggestion that the Court adopt a rule that a decisionmaker's independent investigation and rejection of an employee's allegations of discriminatory animus can insulate an employer from liability, as such an action would negate the effects of any prior discrimination. The Court held that "we are aware of no principle in tort or agency law under which an employer's mere conduct of an independent investigation has a claim-preclusive effect. Nor do we think the independent investigation somehow relieves the employer of 'fault.' The employer is at fault because one of its agents committed an action based on discriminatory animus that was intended to cause, and did in fact cause, an adverse employment decision." The Court also rejected Justice Alito's suggestion that an employer should be held liable only when it "should be regarded as having delegated part of the decisionmaking power to the biased supervisor."

While it reversed the decision of the Seventh Circuit, the Court explicitly left two questions unanswered: First, the Court expressed no opinion as to whether an employer could be held liable under such a "cat's-paw" theory of liability if a co-worker, rather than a supervisor, committed a discriminatory action that influenced a subsequent adverse employment action. Second, the Court acknowledged that in this case, Staub took advantage of Proctor's internal grievance procedures after having been terminated, but refused to comment on whether Proctor would enjoy an affirmative defense to liability had Staub not done so. Therefore, one is likely to see these issues being litigated in the lower courts in the future.

You can read the Supreme Court's full opinion in Staub v. Proctor here: http://www.supremecourt.gov/opinions/10pdf/09-400.pdf

Proposed House Bill Would Prohibit Disclosure of Prior Criminal Convictions on Employment Applications in Pennsylvania

2011-02-18T10:43:00.000-05:00

House Bill 747, which was introduced in the Pennsylvania General Assembly on February 17, 2011, would amend the Pennsylvania Human Relations Act (Pennsylvania's Title VII / ADA / ADEA equivalent), to prohibit employers with more than four employees in Pennsylvania to require job applicants to disclose criminal histories on employment applications, unless the job being applied for has predetermined security regulations established by the Federal or State Governments.

Pennsylvania law already limits the manner in which an employer may use a job applicant's criminal history record. In deciding on whether or not to hire a job applicant, an employer may only consider the applicant's prior felony or misdemeanor convictions to the extent that those convictions "relate to the applicant's suitability for employment in the position for which he has applied," and must notify a job applicant in writing if the decision not to hire the applicant was based "in whole or in part on criminal history record information."

Anti-Discrimination Ordinance Adopted In Haverford Township

2011-02-15T09:03:00.000-05:00

At its February 14, 2011 Board of Commissioners' meeting, Haverford Township in Delaware County, PA, adopted a new anti-discrimination ordinance, which provides broader protections against employment and other types of discrimination than the current federal and state anti-discrimination laws.

Like Title VII, the Americans with Disabilities Act, the Age Discrimination in Employment Act and the Pennsylvania Human Relations Act, the new Haverford Ordinance prohibits employment discrimination within the Township on the traditional bases of race, color, religion, ancestry, age, sex, national origin, handicap or disability and the use of a support animal.

Unlike its federal and state counterparts, however, the new Haverford Township Ordinance also prohibits discrimination on the basis of sexual orientation, gender identity and gender expression. The term "gender identity" is defined as "the gender(s), or lack thereof, a person self-identifies as, whether or not based on biological fact or sexual orientation." The term "gender expression," refers to "the manner in which a person's identity is communicated or perceived by others, through appearance, behavior, or physical characteristics that may be in accord with, or opposed to, one's physical anatomy, chromosomal sex, or sex at birth, and shall include, but is not limited to, persons who are undergoing or have completed sex change."

The prohibitions on employment discrimination under the new Ordinance encompass all those employer actions that are currently prohibited by the Pennsylvania Human Relations Act (which, in turn, takes most of its prohibited practices from the federal case law that has developed under Title VII), against any of the protected classes listed above.

The Haverford Township Anti-Discrimination Ordinance applies to every employer that has four or more employees within the Township.

This Ordinance also establishes an 11-member Human Relations Commission for Haverford Township, which is charged with enforcing the provisions of the Ordinance. The Commission has the authority to order affirmative action by an employer to correct or compensate for employment discrimination, such as ordering back pay, the hiring, promotion or reinstatement of an aggrieved employee, and the making of reasonable accommodations. The Commission may also assess a civil penalty against any employer who violates this Ordinance up to a maximum amount of $5,000.00, along with an award of attorneys' fees to a successful employee. Attorneys fees for an employer who prevails in any complaint made against it under this Ordinance may also seek attorneys fees, but only if it can prove that the complaint was brought in bad faith. Any order of the Human Relations Commission is appealable to the Court of Common Pleas of Delaware County.

If you are an employer in Haverford Township with four or more employees, or if you work for an employer in Haverford Township with four or more employees, and want to discuss your rights or obligations under this new Ordinance, please call the law office of Eckell, Sparks, Levy, Auerbach, Monte, Sloane, Matthews & Auslander, P.C., at 484-842-0363 or 610-565-3700, to speak with Michael Davey, Esq..

Michael Davey Interviewed By "Easy Small Business HR" - Podcast Now Available For Download!

2011-02-11T08:57:00.001-05:00

I recently had the pleasure of being interviewed by Dianne Austin, who runs a great informational website called "Easy Small Business HR," which is focused on employment and HR issues that confront small businesses. Our interview covered topics such as the top 3 employment law issues that employers need to be mindful of, the most common complaints that employees level against their employers and actions that get employers into trouble. I had a great time giving the interview and answering Dianne's questions, and I hope everyone gets a chance to listen to the podcast and receive some valuable and helpful information.

You can download the interview directly from Dianne's website at http://easysmallbusinesshr.com/2011/02/esbhr-podcast-interview-employment-law-advice-michael-davey-esq/ Or, you can find the interview on iTunes by searching for "Easy Small Business HR Podcast," as well as on Easy Small Business HR's Twitter and Facebook pages.

Thanks again Dianne!

"Marital Status" As A Protected Class Under the PA Human Relations Act? Maybe.

2011-01-27T14:34:00.001-05:00

On January 26, 2011, Senate Bill 280 was introduced into the Pennsylvania General Assembly, which would amend the Pennsylvania Human Relations Act (PaHRA) to prohibit discrimination, including employment discrimination, on the basis of an individual's "marital status." The proposed bill defines "marital status" as referring to whether an individual is "single, married, divorced, separated or widowed."

If S.B. 280 is passed, all of the employment practices that the PaHRA currently prohibits with respect to race, color, religious creed, ancestry, age, sex, national origin, handicap or disability, would be extended to reach one's "marital status," as well. This would mean that an employer would be prohibited under the PaHRA from: (1) refusing to hire an individual because of his/her marital status; (2) firing an individual because of his/her marital status; (3) otherwise discriminating against an individual because of his/her marital status; (4) inquiring into an employee's, or prospective employee's, marital status; and (5) asking questions about an individual's marital status on any application for employment, just to name a few.

And, given the fact that the courts in Pennsylvania have traditionally employed identical analyses when interpreting the provisions of Title VII and the PaHRA, one wonders whether this proposed addition would also permit a claim for hostile work environment based upon one's marital status? So, as a "head's up" to any married men (or women) out there who work in an office full of bachelors (or bachelorettes) who are forced to listen to constant stories of wild singles parties, drunken weekend "conquests" and happy-hour strip-club campaigns, keep an eye on this legislative gem - you may actually find yourself being a member of a "protected class" before too long.

You can read the full version of S.B. 280 by going to the PA General Assembly website at by going to the PA General Assembly website at http://www.legis.state.pa.us/index.cfm

Bill To Raise State Minimum Wage Introduced in PA Senate

2011-01-26T08:35:00.004-05:00

On January 24, 2011, Senate Bill 235 of 2011 was introduced in the PA State Senate, which calls for an annual cost-of-living increase in the state minimum wage beginning on January 1, 2012 and continuing every January 1 thereafter. The amount of the cost-of-living increase would be calculated by applying the percentage change in the Consumer Price Index for all Urban Consumers in Pennsylvania, New Jersey, Delaware and Maryland, using the most recent 12-month period figures that have been officially submitted to the U.S. Department of Labor, Bureau of Labor Statistics. S.B. 235 also provides that the Secretary of Labor and Industry would be responsible for setting the actual percentage increase and the minimum wage amounts each year.

Pennsylvania's Minimum Wage was last increased in 2009 and is currently $7.25 per hour, equivalent to the Federal Minimum Wage.

S.B. 235 was introduced by State Senator Christine Tartaglione (D-Philadelphia) and other sponsors. You can read the full text S.B. 235 by going to the PA General Assembly website at http://www.legis.state.pa.us/index.cfm

U.S. Supreme Court - Government Employers May Ask "Reasonable Questions" in Employment Background Investigations

2011-01-25T14:45:00.000-05:00

On January 19, 2011, in the case of NASA v. Nelson, et al., the U.S. Supreme Court held that governmental employers are permitted to ask "reasonable questions," during employee background investigation checks without running afoul of employees' constitutional privacy rights.

This case concerned an employee background check process employed by NASA, consisting of two questionnaire forms. The first asked whether an employee had "used, possessed, supplied, or manufactured illegal drugs in the last year," and if so, then required the employee to describe the details of any "treatment or counseling received." Employees were also required to sign a release authorizing the Government to obtain personal information about employees from schools and past employers. The second form then asked open-ended questions about whether NASA had "any reason to question," an employee's "honesty or trustworthiness," or whether an employee had "adverse information," concerning an employee's "violations of the law," "financial integrity," "abuse of alcohol and/or other drugs," "mental or emotional stability," "general behavior or conduct," and "other matters." If an employee checks "yes" to any of those categories, the form required a further written explanation.

Various NASA employees sued, claiming that NASA's subjecting them to this employment background check process violated their constitutional right to "informational privacy." The District Court refused the employees' request for a preliminary injunction, but the Ninth Circuit Court of Appeals reversed, holding that with respect to the first form, NASA's requirement that an employee disclose drug treatment and counseling furthered no legitimate government interest and was thus likely unconstitutional. With respect to the second form, the Ninth Circuit determined that the open-ended questions asked by NASA were not narrowly tailored to meet the government's interests in verifying the employees' identities, and thus, likely violated the employees' constitutional rights.

In granting certiorari, the U.S. Supreme Court had the opportunity, for the second time in two years, to address the available breadth of privacy rights that may, or may not, be held by individuals who are employed in the public sector. One year ago, the Supreme Court had a similar opportunity in City of Ontario v. Quon, 130 S. Ct. 2619 (2010), which concerned whether a SWAT officer had a reasonable expectation of privacy in the content of text messages he had sent over a city-issued pager. In Quon, however, the Supreme Court specifically avoided any issues concerning employee privacy rights under the Fourth Amendment, but instead opted to resolve the case by holding that any search of the officer's text messages conducted by the City was reasonable, and thus, could not be a violation of the Fourth Amendment. For a thorough analysis of this case, see my earlier post entitled "U.S. Supreme Court Side-Steps Questions of Employee Privacy in Electronic Communications," from June 18, 2010..

In Nelson, however, the Supreme Court took the same tack as it did in Quon and once again avoided discussion concerning the thorny issues involving the privacy rights of public employees in the workplace. Instead, the Court stated that "we will assume for present purposes that the Government's challenged inquiries implicate a privacy interest of constitutional significance." That being said, however, the Court then proceeded to overrule the decision of the Ninth Circuit, and held that "whatever the scope of this [privacy] interest, it does not prevent the Government from asking reasonable questions of the sort included on the [NASA forms] in an employment background investigation that is subject to the [federal] Privacy Act's safeguards against public disclosure."

In so holding, the Supreme Court reaffirmed the long-standing tenet that "the Government has a much freer hand in dealing with citizen employees than it does when it brings its sovereign power to bear on citizens at large." The Court also recognized that the types of questions being challenged in this case were "part of a standard employment background check of the sort used by millions of private employers," that "the Government itself has been conducting employment investigations since the earliest days of the Republic," and that "[s]tandard background investigations similar to those at issue here became mandatory for all candidates for the federal civil service in 1953." As such, the Court recognized that the federal government has an interest in performing background checks on its employees and that "[r]easonable investigations of applicants and employees aid the Government in ensuring the security of its facilities and in employing a competent, reliable work-force."

The Court rejected out of hand the employees' claims that the Government's broad authority in regulating and managing its affairs should not apply with as great a force to them, as they were "contract employees," not civil servants. The Court found this argument placed form over substance, holding that "the Government's interest as 'proprietor' in managing its operations . . . does not turn on such formalities," and noting that on the record before it, there was no relevant distinctions between the duties performed by NASA's civil servants and its contract employees.

Against this back-drop, the Court held that the questions asked by NASA on the two employment background check forms were "reasonable, employment-related inquiries that further the Government's interests in managing its internal operations." Specifically, the Court noted that the Government has a "good reason to ask employees about their recent illegal-drug use," namely, to ensure that it will have its "projects staffed by reliable, law-abiding persons who will efficiently and effectively discharge their duties." With this legitimate purpose, the Court determined that the form's follow-up questions concerning any treatment or counseling for illegal-drug use was also a reasonable method by which the Government could separate out those individuals who have taken steps to address and overcome their illegal drug problems, and use this as a mitigating factor in making employment decisions. In the Court's words, this "is a reasonable, and indeed humane, approach. . ."

The Supreme Court also rejected outright the employees' argument that the Government "when it requests job-related personal information in an employment background-check, has a constitutional burden to demonstrate that its questions are necessary or the least restrictive means of furthering its efforts."

The Court also held that the open-ended questions that so troubled the Ninth Circuit Court of Appeals, were in fact "reasonably aimed at identifying capable employees who will faithfully conduct the Government's business," and similar in type and scope to employment background questions frequently used by employers in the private sector.

Lastly, the Court recognized that any privacy interests held by the employees here were further protected by the fact that the NASA forms were governed by the federal Privacy Act, which allows the Government to maintain records about an employee "only to the extent the records are relevant and necessary to accomplish a purpose authorized by law," and requires "written consent before the Government may disclose records pertaining to any individual."

Therefore, in light of the Privacy Act's nondisclosure requirements, coupled with the fact that the questions posed on the two NASA forms "consist of reasonable inquiries in an employment background check," the Court held that NASA's background process did not violate any "constitutional right to informational privacy."

In a notable concurring opinion, Justice Scalia (joined by Justice Thomas), stated that he would have decided the case "on simpler grounds." Specifically, that "[a] federal constitutional right to 'informational privacy' does not exist." This concurrence may be a gloomy portent of how the Supreme Court may examine the issue of public-employee privacy rights in electronic communications when, and if, the Court ever decides to take it up.

You can read the full version of the Court's opinion here: http://www.supremecourt.gov/opinions/10pdf/09-530.pdf

U.S. Supreme Court Recognizes Third-Party Retaliation Claims Under Title VII

2011-01-25T10:36:00.000-05:00

On January 24, 2011, the U.S. Supreme Court held, in the closely-watched case of Thompson v. North American Stainless, LP that Title VII's anti-retaliation provision permits "third-party retaliation claims."

Prior to 2003, Eric Thompson and his fiance, Miriam Regalado were employees of North American Stainless (NAS). In February of 2003, NAS was notified by the EEOC that Regalado had filed a charge alleging sex discrimination. Three weeks later, Thompson was fired by NAS.

Thompson then filed his own charge with the EEOC, claiming that NAS had terminated him in order to retaliate against Regalado for her filing a sex discrimination charge with the EEOC. The district court dismissed Thompson's claim, holding that Title VII did not permit third-party retaliation claims. The Sixth Circuit, after a rehearing en banc, affirmed the dismissal of Thompson's claim, holding that he had not engaged in any statutorily protected conduct under Title VII.

On appeal, the Supreme Court reversed, and held that Thompson has a viable retaliation claim under Title VII. First, the Court noted that "we have little difficulty concluding that if the facts alleged by Thompson are true, then NAS's firing of Thompson violated Title VII." The Court reaffirmed that "Title VII's antiretaliation provision must be construed to cover a broad range of employer conduct," and that this provision "prohibits any employer action that might well have dissuaded a reasonable worker from making or supporting a charge of discrimination." Given this basis, the Court stated that "[w]e think it obvious that a reasonable worker might be dissuaded from engaging in protected activity if she knew that her fiance would be fired."

While recognizing that third parties are protected from retaliation under Title VII, the Court refused "to identify a fixed class of relationships for which third-party reprisals are unlawful," but re-emphasized that the standard for judging harm under the anti-retaliation provision "must be objective."

The more difficult question facing the Court was whether Thompson had standing to sue NAS within Title VII's category of a "person claiming to be aggrieved." First, the Court specifically rejected the argument that Title VII's "person claiming to be aggrieved," language automatically grants any individual who suffers harm under Title VII Article III standing in every instance. But, the Court also rejected NAS's opposite argument that Title VII's "person claiming to be aggrieved," language refers only to the employee who is engaged in the protected activity. As such, the Court settled on a middle-ground approach and adopted the "zone of interests" test that has been applied to determine whether a person "adversely affected or aggrieved," has Article III standing to sue under the Administrative Procedure Act. This test states that a plaintiff may not sue unless he/she "falls within the zone of interests sought to be protected by the statutory provision whose violations forms the legal basis for his complaint." The Court described this test as prohibiting Article III standing "if the plaintiff's interests are so marginally related to or inconsistent with the purposes implicit in the statute that it cannot reasonably be assumed that Congress intended to permit the suit."

Applying this test to Thompson, the Court had little trouble concluding that Thompson fell within the "zone of interests" protected by Title VII. Specifically, Thompson was an employee of NAS and Title VII is meant to protect employees from employer's unlawful actions. The Court also noted that Thompson was not "an accidental victim of retaliation - collateral damage, so to speak, of the employer's unlawful act. To the contary, injuring him was the employer's intended means of harming Regalado. Hurting him was the unlawful act by which the employer punished her." As such, the Court found that Thompson was "well within the zone of interests sought to be protected by Title VII," and permitted his claim to proceed.

You can read the full version of the Supreme Court's opinion here: http://www.supremecourt.gov/opinions/10pdf/09-291.pdf

Superior Court Decision Reveals Legal Discord Over Claims of Intentional Inference With Contractual Relations By At-Will Employees

2011-01-25T09:43:00.001-05:00

In the non-precedential decision of Haun v. Community Health Systems, Inc., et al., No.: 2350 EDA 2009 (PA Super. 12/20/2010), the Pennsylvania Superior Court affirmed a ruling by the trial court, which dismissed an at-will employee's claims for intentional interference with contractual relations. The dissenting opinion, however, shows that this area of Pennsylvania law is still arguably unsettled.

By way of backgroun, Richard Haun served as the Chief Financial Officer at Phoenixville Hospital from June, 2007 until November 12, 2008. Haun was an at-will employee in his position as CFO.

On August 23, 2007, Haun's wife gave birth to premature twins at Phoenixville Hospital. The twins were taken to the Neonatal Intensive Care Unit at Phoenixville Hospital, and while in the Unit, one of the twins became disconnected from an IV line. This caused extensive blood loss to the baby, which in turn, resulted in severe and irreversible injury to the baby's central nervous system.

Shortly thereafter, Haun and his wife filed a medical malpractice suit against Phoenixville Hospital, its corporate parents and a number of the doctors and nurses of Phoenixville Hospital.

Five days after being served with the suit, the Interim President for the corporate hospital defendants sent an email to the CEO of Phoenixville Hospital, instructing the CEO to have a discussion with the Chief Counsel for the corporate hospital defendants about the possibility of terminating Haun's employment. On November 12, 2008, the CEO of Phoenixville Hospital and the Phoenixville Hospital Human Resources Director met with Haun and informed him that he was being fired from the hospital because he was "an adversary of the company and it's too much risk." Haun was then immediately escorted from the building and was denied the opportunity to collect his personal effects.

After being fired from Phoenixville Hospital, Haun filed a second suit against the Hospital and its corporate parents, alleging, among other claims, wrongful termination in violation of public policy and intentional inference with contractual relations. The corporate defendants filed objections seeking dismissal of his intentional interference claim, arguing that Pennsylvania law does not recognize such a cause of action for a current at-will employee. (The defendants also filed an objection seeking to dismiss Haun's wrongful termination claim, which was denied by the trial court and affirmed on appeal. For a full discussion of this claim, see my previous post).

The trial court dismissed Haun's claim, and on appeal, this decision was affirmed by the Superior Court.

Specifically, the Superior Court looked to its previous panel decision in Hennessy v. Santiago, 708 A.2d 1269 (Pa. Super. 1998), which held that an at-will employee may not sue a third-party for intentional interference with an existing at-will employment contract. Rather, the Hennessy Court held that a cause of action for intentional interfence exists only with respect to prospective at-will employment relationships, not with presently existing at-will employment relationships. Therefore, relying upon the Hennessy decision, the Superior Court in this case upheld the dismissal of Haun's claim, noting that he was clearly a current at-will employee at the time of his termination.

The dissenting opinion, however, raises a compelling argument that the Hennessy decision was wrongly decided, as being in conflict with previous Superior Court decision. First, the dissent noted that in the prior case of Curran v. Children's Service Center, 578 A.2d 8 (Pa. Super. 1990), another panel of the Superior Court unequivocally held that "a cause of action for intentional interference with a contractual relationship may be sustained even though the employment relationship is at-will." And, having been decided before Hennessy, the dissent reasoned that Curran was the correct statement of the law and should be followed.

Additionally, the dissent notes that the decision in Curran relied upon Comment g of Section 766 of the Restatement (Second) of Torts, which explicitly addresses contracts that are terminable at-will. Moreover, the Pennsylvania Supreme Court expressly adopted Section 766 in Thompson Coal Co. v. Pike Coal Co., 412 A.2d 466 (Pa. 1979). Comment g states that an at-will employee has an interest in future relations between the employee and the employer, but has no legal assurance of them. For that reason, an interference in that interest would be closely analogous to interference with prospective contractual relations - a cause of action that has already been recognized and sanctioned for at-will employment in Pennsylvania. The dissent noted that the Hennessy Court failed to address either Section 766, Comment g, or the Curran decision, and as such, its reasoning should be viewed circumspectly.

The Pennsylvania Supreme Court has not yet rendered a decision addressing whether an at-will employee may maintain a claim for intentional interference with contractual relations against a third-party. But, the dissent in Haun sets forth a compelling argument that emphasizes the apparent lack of decisional consistency and clarity from the Superior Court on this issue. In such cases, it is usually only a matter of time before the Supreme Court recognizes the need to step in and settle the law. Hopefully, we will see a decision by the Supreme Court on this issue sooner rather than later.

Superior Court Allows Claim For Wrongful Discharge By Former Hospital Executive

2011-01-25T09:12:00.001-05:00

In the non-precedential decision of Haun v. Community Health Systems, Inc., et al., No.: 2350 EDA 2009 (PA Super. 12/20/2010), the Pennsylvania Superior Court affirmed and adopted the decision of the trial court, which refused to dismiss a wrongful discharge claim filed by a former hospital executive.

Richard Haun served as the Chief Financial Officer at Phoenixville Hospital from June, 2007 until November 12, 2008. Haun was an at-will employee in his position as CFO.

On August 23, 2007, Haun's wife gave birth to premature twins at Phoenixville Hospital. The twins were taken to the Neonatal Intensive Care Unit at Phoenixville Hospital, and while in the Unit, one of the twins became disconnected from an IV line. This caused extensive blood loss to the baby, which in turn, resulted in severe and irreversible injury to the baby's central nervous system.

Shortly thereafter, Haun and his wife filed a medical malpractice suit against Phoenixville Hospital, its corporate parents and a number of the doctors and nurses at Phoenixville Hospital.

Five days after being served with the suit, the Interim President for the corporate hospital defendants sent an email to the CEO of Phoenixville Hospital, instructing him to have a discussion with the Chief Counsel for the corporate hospital defendants about the possibility of terminating Haun's employment. On November 12, 2008, the CEO of Phoenixville Hospital and the Phoenixville Hospital Human Resources Director met with Haun and informed him that he was being fired from the hospital because he was "an adversary of the company and it's too much risk." Haun was then immediately escorted from the building and was denied the opportunity to collect his personal effects.

After being fired from Phoenixville Hospital, Haun filed a second suit against the Hospital and its corporate parents, alleging, among other claims, wrongful termination in violation of public policy. The corporate defendants filed objections seeking dismissal of this claim, arguing that Haun had failed to plead any recognized public policy exception to Pennsylvania's employee at-will doctrine.

The trial court overruled this objection, holding that Haun had established a good-faith argument that his dismissal violated public policy. Specifically, the trial court found that the public policy of Pennsylvania favors allowing the victims of medical malpractice to seek adequate compensation and also favors parents asserting legal claims on behalf of their children. The trial court held that these precepts supported Haun's allegations that his termination for assisting his child in seeking compensation for alleged medical malpractice violated a clear mandate of public policy.

On appeal, the Superior Court agreed with the reasoning and analysis of the trial court, and adopted the trial court's discussion of this issue as its own.

Haverford Township Anti-Discrimination Law Passes First Procedural Hurdle

2011-01-12T09:09:00.000-05:00

On Monday, January 10, the Board of Commissioners of Haverford Township, Delaware County, PA narrowly approved a first reading of a controversial anti-discrimination ordinance, which if passed, would prevent employment discrimination (as well as discrimination in housing, public accommodation and commercial property) within the Township based not only upon race, color, religion, sex, nationality and disabilities, but also upon sexual orientation. Employment discrimination on the basis of sexual orientation is currently not protected under either the Pennsylvania Human Relations Act or Title VII. The ordinance would also establish a local human relations commission of volunteer citizens, which would be authorized to mediate claims and the power to impose fines up to $10,000.00 and award attorneys fees.

Read the full story from the Delaware County Daily Times here: http://www.delcotimes.com/articles/2011/01/12/news/doc4d2d20d058351959102883.txt?viewmode=default

Ever Filed For Bankruptcy? Don't Put It On Your Resume.

2010-12-20T10:19:00.001-05:00

On December 15, 2010, in the case of Rea v. Federated Investors, No.: 10-1440, the Third Circuit Court of Appeals held that the federal Bankruptcy Code does not prohibit a private employer from refusing to hire an applicant solely because that applicant had previously filed for bankruptcy.

The plaintiff in this case, Dean Rea, had filed for bankruptcy in 2002 and his debts were discharged in 2003. In 2009, Rea applied for employment with Federated Investors, a private company. After an interview, it initially appeared that Rea would be hired by Federated Investors. Rea was later informed, however, that Federated Investors had refused to hire him because he had previously been in bankruptcy.

Rea then filed suit, arguing that section 525(b) of the Bankruptcy Code (11 U.S.C. 525(b)) prohibited discrimination against an individual solely because he or she is or has been a debtor in bankruptcy. Specifically, section 525(b) directs, in pertinent part, that:

"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 the Bankruptcy Act, or an individual associated with such debtor or bankruptcy, solely because such debtor or bankrupt -- (1) is or has been a debtor under this title or a debtor or bankrupt under the Bankruptcy Act. . ."

The District Court dismissed Rea's case, holding that the language of Section 525(b), above, does not prohibit an employer from refusing to hire an applicant on the basis of a previous bankruptcy.

On appeal, the Third Circuit agreed, and affirmed the dismissal of Rea's case. Specifically, the Court looked at the language of Section 525(b) quoted above, which is directed to private employers, and compared it to the language set forth in Section 525(a), which is directed to governmental agencies. The Court noted that the texts of Sections 525(a) and 525(b) are nearly identical, but not completely. The Court noted that Section 525(a) provides that a governmental unit shall not "deny employment to, terminate the employment of, or discriminate with respect to employment against," a person that is or has been in bankruptcy, but that Section 525(b) lacks any such language concerning "denying employment to." The Third Circuit held that the omission of the phrase "deny employment to," by Congress in Section 525(b) was intentional, and effect must be given to this important difference. As such, the Court reasoned that by intentionally omitting the phrase "deny employment to," in Section 525(b), after having specifically included it in Section 525(a), Congress did not intend to prohibit a private employer from refusing to hire an applicant because of that applicant's previous or current bankruptcy.

You can view the Third Circuit's full opinion here: http://www.ca3.uscourts.gov/opinarch/101440p.pdf

Eastern District of PA: ADA Claim For Failure To Provide Disabled Employee With A Cell Phone May Be Sent To A Jury

2010-12-16T10:10:00.001-05:00

In the case of Boandl v. Geithner, No.: 09-4799 (E.D. Pa. 11/2/2010), the U.S. District Court for the Eastern District of Pennsylvania held that a jury was permitted to hear the claims of Richard Boandl, a disabled former IRS Revenue Agent, in which he alleged that the IRS had failed to engage in the interactive process required by the Rehabilitation Act and the Americans with Disabilities Act (ADA), when his immediate supervisory summarily denied his verbal request to provide him with a cell phone to assist him in the performance of his investigative duties.

At a young age, Boandl had been infected with polio, and as a result, has been disabled for most of his life. He has a severe limp, cannot stand for more than a few minutes at a time, and requires the use of a cane to walk short distances and a wheelchair to travel distances of more than twenty yards. Boandl had been employed as a Revenue Agent with the IRS from 1983 until 2004.

In late 2003, Boandl spoke to his immediate supervisor and requested that the IRS issue him a cell phone as a reasonable accommodation for his disability. Boandl alleged that he needed a cell phone to assist in his investigative duties, which required traveling outside his office to locate tax non-filers and visit witnesses. Boandl told his supervisor that because of his disability, it was difficult for him to repeatedly have to get in and out of his car, walk and stand while in the process of trying to locate, and then use, a working pay phone while out of the office. Boandl alleged that his supervisor immediately denied his request. Boandl then emailed a copy of his cell phone request to his supervisor on or about December 11, 2003. On January 20, 2004, Boandl's supervisor provided him with a written memorandum officially denying his request for a cell phone on the basis that the IRS did not issue cell phones to any employees holding Boandl's position, and that the ability to be able to return phone calls while in the field was not an essential function of Boandl's position.

In denying the government's subsequent Motion for Summary Judgment on this issue, the Court found that Boandl had produced sufficient evidence that would allow a jury to conclude that the IRS had failed to engage in the interactive process required by the Rehabilitation Act and the ADA because Boandl's supervisor had summarily denied his oral request for an accommodation. Moreover, the Court noted that the IRS' stated reason for denying Boandl' request, i.e., that the need to return phone calls while in the field was not an essential function of his position, was not the sole reason for Boandl's cell phone request. Rather, Boandl had specifically alleged that he had investigative duties while out of the office, such as locating non-tax filers and locating witnesses, which required the use of a cell phone. The Court held that because the government had failed to present any evidence that these tasks were not essential functions of Boandl's job, it was not entitled to summary judgment on this claim. Therefore, a dispute existed over whether the tasks identified by Boandl were essential functions of his position, which was required to be resolved by a jury.

The lesson that employers and HR specialists need to take away from this case is that summarily denying requests for accommodation under the ADA or the Rehabilitation Act is never good practice. Rather, each request, even if it may facially appear to not require an accommodation, should be given its due consideration and analysis. A summary denial of any request for accommodation, especially one that is made verbally, can leave an employer exposed to a claim for failure to engage in the required interactive process.

Western District of PA Dismisses Title VII and ADA Claims for Insufficient Facts

2010-12-16T09:13:00.000-05:00

In the case of Robuck v. Mine Safety Appliances Co., No.: 2:10-cv-00763 (W.D. Pa. 11/3/2010), the U.S. District Court for the Western District of Pennsylvania dismissed claims of retaliation under Title VII and the ADA due to the employee's failure to plead sufficient factual allegations. While the arguments behind Robuck's claims here may have been admittedly weak from a plaintiff's perspective, this case serves as an important reminder of the importance that needs to be paid by a plaintiff's attorney to fact-pleading in the aftermath of the now infamous Twombly and Iqbal decisions.

The employee, Dennis Robuck, claimed to suffer from hypertension that required him to avoid stress and to take long walks on a regular basis, which he often did on his lunch break. He also alleged to have a problem with a female co-worker, Ruth Protzman, who apparently also took walks during her lunch break, as well. Robuck alleged that he made every attempt to avoid Ms. Protzman, and even the employer admitted that up until February of 2007, it had made every effort to keep Robuck and Ms. Protzman separated. One of the ways in which it did this was to allow Ms. Protzman to take her lunch hour at 11:30 AM, while Robuck took his lunch hour at 12:00 PM.

In February of 2007, however, the employer changed Robuck's lunch hour to 11:30 AM. Robuck alleged that the employer failed to accommodate him by changing his lunch hour back to 12:00 PM, despite his continuing complaints. Robuck also alleged that he had made numerous complaints to his supervisor, stating that the employer had given priority to Ms. Protzman over Robuck when attempting to separate them.

On October 29, 2007, Robuck was terminated by his employer, and subsequently received a letter from the employer indicating that had been discharged for willfully disregarding workplace rules.

Robuck subsequently filed suit, alleging that the reason given by the employer for his termination was pretextual, and that he was actually terminated for walking on a road on which the employer believed Ms. Protzman might also have been walking on at the same time. Robuck insisted, however, that Ms. Protzman was not even walking on the road at that time and that she was not even at work on the date of his alleged offense. Robuck alleged retaliation on the basis of sex in violation of Title VII, and retaliation in violation of the ADA.

The employer filed a motion to dismiss, arguing that Robuck had failed to allege sufficient facts to sustain claims of retaliation under either Title VII or the ADA. The District Court agreed, and dismissed both claims. With respect to Robuck's claim that he was treated less favorably by his employer than Ms. Protzman, the Court held that the only real facts alleged by Robuck in his Amended Complaint related to his ongoing dispute with Ms. Protzman and the employer's attempt to keep them apart, which was thwarted by a change in lunch schedule. However, the Court found that "[Robuck's] allegations are little more than generalized complaints of unfairness which do not and cannot constitute protected activity." While Robuck alleged that the employer "always gave priority," to Ms. Protzman, he failed to set forth any facts to "support his conclusory allegation that he complained of sex discrimination to his supervisor or anyone else." Moreover, the Court recognized that "[Robuck's] Amended Complaint is similarly vague in that [the employer's] alleged favoritism towards Ms. Protzman could have been motivated by any number of factors which are not protected under Title VII."

With respect to Robuck's ADA retaliation claim, the Court noted that while "[Robuck] alleges that [the employer] has discriminated against him as a result of his previous complaints of discrimination based on [his] disability . . . [Robuck] . . . provides no indication that he ever mentioned his disability during his discussion with his supervisor . . . or anyone else. Therefore, [Robuck] did not explicitly or implicitly plead that his alleged disability was the reason for the unfairness in which he complains. Accordingly, such complaint does not constitute 'protected activity' to constitute a prima facie case of retaliation." Therefore, the Court dismissed Robuck's ADA claim as well.

Had more care been taken by Robuck's counsel in drafting the Amended Complaint in this case, so as to include more specific facts, circumstances and events, it is possible that the Court would not have dismissed it at a 12(b)(6) stage. At the very least, getting past the pleadings and into active discovery may have allowed Robuck to garner some leverage in which to settle the case. But, a sloppy and imprecise Amended Complaint here served no other purpose but to get Robuck's Title VII and ADA retaliation claims dismissed at the outset. It should also be noted that Robuck received no sympathy from the Court with respect to his request to be allowed to file a Second Amended Complaint to correct these deficiencies. As of the date of the Order dismissing these claims, the Court noted that this case had been in litigation for nearly three years. Given that length of time, the Court held that "[Robuck] and his counsel have had ample time and the necessary means to secure and plead facts to support his claims," and as such, allowing Robuck the opportunity to file a Second Amended Complaint would be, in the Court's own words, "futile."

The lesson is clear - pay close and careful attention to your factual pleadings. The more, the better.

Final EEOC Regulations Under GINA Published

2010-11-30T08:20:00.000-05:00

Below is a link to the Final EEOC Regulations under GINA, which were published on 11/9/2010 and become effective January 1, 2011.

http://www.federalregister.gov/articles/2010/11/09/2010-28011/regulations-under-the-genetic-information-nondiscrimination-act-of-2008#p-3

PA Supreme Court: In-Home Nurses Entitled To Overtime Pay

2010-11-24T09:31:00.000-05:00

On November 17, 2010, in the case of Bayada Nurses, Inc. v. Commonwealth of Pennsylvania Dept. of Labor and Industry, No.: 67 MAP 2008, the Pennsylvania Supreme Court held that under the Pennsylvania Minimum Wage Act of 1968 (PMWA), an employer that provides in-home nursing care to individuals is not exempt from paying its nurses overtime pay under the "domestic services," exemption to the PMWA.

The general rule under the PMWA is that an employer in Pennsylvania must pay its employees a minimum wage plus overtime for hours worked in excess of 40 hours per week. However, the PMWA provides for a number of exemptions to this general rule, including the "domestic services exemption," found at 43 P.S. section 333.105(a)(2). This section provides that a Pennsylvania employer is exempt from the minimum wage and overtime provisions of the PMWA for "domestic services in or about the private home of the employer." A subsequent regulation promulgated by the Pennsylvania Department of Labor and Industry interpreting this statutory provision defined "domestic services" as "work in or about a private dwelling for an employer in his capacity as a householder, as distinguished from work in or about a private dwelling for such employer in the employer's pursuit of a trade, occupation, profession, enterprise or vocation." 34 Pa. Code section 231.1(b). In other words, under the Department's regulation, the only employers who qualify for the "domestic services" exemption to the PMWA are those that employ individuals for work in or about a private dwelling that the employer itself owns or possesses. In other words, according to the Department, work sought to be exempted has to be performed for an employer in his or her capacity as a householder.

In this instance, the Department notified Bayada Nurses, Inc., that it would be performing a wage and overtime audit. Bayada Nurses, Inc., is a Pennsylvania corporation that offers nursing care, personal care, physical therapy and rehabilitation to pediatric, adult and geriatric clients. Bayada employs licensed nurses, registered nurses and home health care aides. Bayada paid its home health care aides an hourly wage, with each hour of service billed to the client. Bayada did not, however, pay those aides overtime. Upon being notified of a potential audit by the Department, Bayada filed a petition seeking a declaration that: (1) challenged the validity of the Department's regulation as improperly limiting the scope of the domestic services exemption; (2) Bayada's clients were "employers" for purposes of the PMWA, such that Bayada and its clients could both take advantage of the domestic services exemption; and (3) the domestic services exemption of the PMWA should be interpreted consistently with the exemptions of the federal Fair Labor Standards Act (FLSA).

The Supreme Court rejected all of Bayada's arguments, and held that: (1) the Department's regulation interpreting the term "domestic services" to exclude those employers who are not householders themselves was consistent with the plain statutory language of the PMWA; (2) Bayada was not entitled to take advantage of the domestic services exemption because in providing aides to clients, Bayada was not a "householder" employer; and (3) the domestic services exemption should not be read consistently with the FLSA because the FLSA sets a federal "floor" for minimum wage and overtime requirements, and states are free to adopt more restrictive (i.e., more employee-friendly) laws and requirements. Since the domestic services exemption to the PMWA, as interpreted by the Department, is more restrictive and employee-friendly than the exemptions set forth in the FLSA, consistency of interpretation was not warranted, and the PMWA domestic services exemption was not pre-empted by federal law. In upholding the reasonableness of the Department's regulation in the first issue, the Supreme Court held that the Department's regulation of "domestic services," which limited the exemption to only those employers who are "householders," was not inconsistent with the plain language of the PMWA, in that "the unambiguous language [of the domestic services exemption] in the statute focuses on one type of employer - a householder."

The impact of this decision will extend well beyond the facts and circumstances of this case. In upholding the Department's application of the domestic services exemption to only those instances where an employee is performing work for his/her employer in the employer's capacity as a "householders," the Pennsylvania Supreme Court sanctioned a rather bright-line rule. Going forward, it would seem that every business in Pennsylvania that provides some manner of "work in or about a private dwelling," will now required to pay its employees overtime for hours worked in excess of 40 per week, unless that employer also owns the private dwelling where the work is being performed. And, given the Department's rather broad definition of "domestic services," as encompassing "all work in or about a private dwelling," this rule would apparently also extend to professions such as landscapers, maids, and cleaning services, and perhaps even to electricians, plumbers, painters, and the like. Therefore, employers in these types of businesses in Pennsylvania who may have been relying upon the "domestic services" exemption to justify a non-payment of overtime to hourly wage workers, need to take another look at their books.

You can read the Pennsylvania Supreme Court's full Opinion here: http://www.courts.state.pa.us/OpPosting/Supreme/out/J-105-2009mo.pdf

2nd Update from "FMLA Insights": GINA and certification forms

2010-11-17T08:22:00.001-05:00

A second update to the article on GINA and certification forms that was posted on "FMLA Insights." 2nd Update: GINA and certification forms

Update: Does GINA really require you to change your certification form?

2010-11-13T10:23:00.000-05:00

Here is an update on an article that I shared yesterday from "FMLA Insights":
Update: Does GINA really require you to change your certification form?

FMLA Insights: GINA Rules Require New Disclosures In Requests For FMLA Certification

2010-11-12T14:20:00.000-05:00

This is a helpful article posted by "FMLA Insights" on the new GINA regulations that become effective January 10, 2011, which require employers seeking medical certifications in support of leave or accommodation requests to provide new disclosures. GINA Rules Require New Disclosures In Requests For FMLA Certification

Classifying Construction Workers as Independent Contractors Will Soon Become More Difficult In Pennsylvania

2010-11-09T14:24:00.002-05:00

On October 13, 2010, Pennsylvania Governor Ed Rendell signed into law House Bill 400 of 2009, otherwise known as the new "Construction Workplace Misclassification Act." This Act sets forth specific criteria that now must be met before individuals employed in the construction industry in Pennsylvania may be classified as "independent contractors" for purposes of workers' compensation and unemployment compensation.

Specifically, an individual who works in the construction industry can only be classified as an "independent contractor" for purposes of workers' compensation and unemployment compensation where the following three conditions are met:

(1) the individual must have a written contract to perform those services

(2) the individual must be free from control or direction over the performance of such service both in the written contract and in fact; and

(3) the individual must be customarily engaged in an independently established trade, occupation, profession or business.

The Act subsequently sets forth a detailed list of multiple factors that must be met before an individual can meet the third prong of the above test, i.e., the "customarily engaged in an independently established trade," prong.

Additionally, the Act provides that an employer's failure to withhold federal or state income taxes or failure to pay unemployment compensation contributions or workers' compensation contributions with respect to an individual's pay shall not be considered a factor in determining whether an individual is an employee for purposes of workers' compensation or unemployment compensation.

An employer who fails to appropriately classify an individual as an employee under this Act faces an array of possible penalties, ranging from a criminal misdemeanor charge for an intentional violation, to a $1,000.00 summary offense, or administrative enforcement, which can entail significant fines and the issuance of a stop-work order for a construction site.

The Act also prohibits an employer from retaliating against any individual for exercising his/her rights under the Act, and creates a "rebuttable presumption" of retaliation when any "adverse action," is taken against an individual within 90 days of that person's exercise of rights under the Act.

While the Act appears to create a private right of action for an individual to report an employer's non-compliance with the Act (individuals who suspect non-compliance are authorized to file a complaint), there is no provision that allows for the collection of monetary damages, costs, or attorneys' fees. However, the Act does provide that if any individual alleges noncompliance by an employer, and does so in good faith, then that individual "shall be afforded the rights provided by this Act, notwithstanding the person's failure to prevail on the merits."

The Construction Workplace Misclassification Act becomes effective on February 13, 2011. All businesses in Pennsylvania engaged in the construction industry that have individuals working for them need to review their current employee/independent contractor classifications in order to ensure compliance with these new rules before the effective date.

You can read the final version of the Construction Workplace Misclassification Act here: http://www.legis.state.pa.us/CFDOCS/Legis/PN/Public/btCheck.cfm?txtType=HTM&sessYr=2009&sessInd=0&billBody=H&billTyp=B&billNbr=0400&pn=4289 (the sections that are not lined-out are the provisions of the bill that have been signed into law).

Federal Court Allows Age and Gender Discrimination Claims Against Rite-Aid To Proceed

2010-10-26T09:07:00.001-04:00

In Lazzaro v. Rite Aid Corporation, 09-cv-1140 (W.D. Pa. 8/17/2010), the U.S. District Court for the Western District of Pennsylvania permitted age and gender discrimination claims filed against Rite Aid Corporation under the Age Discrimination in Employment Act (ADEA), Title VII and the Pennsylvania Human Relations Act (PHRA), to proceed to trial.

Plaintiff, Joann Lazzaro, a 55 year old female, had worked for Rite Aid and its predecessor companies for thirty-six years, beginning on June 20, 1972. She began her career with Brooks/Eckerd stores, and transitioned to Rite Aid after Rite Aid acquired Brooks/Eckerd. After her Brooks/Eckerd store was closed in October of 2007, Lazzaro was transferred as Store Manager to a Rite Aid store located in Wilkinsburg, PA.

In February of 2008, Jeff Suriano, a 37 year old male, became Lazzaro's supervisor when he was made the Rite-Aid District Manager responsible for the Wilkinsburg store. During his first visit to the Wilkinsburg store, Suriano stated to Lazzaro that he thought she was retiring, noting that she had worked there for 30 years. Lazzaro corrected him, noting that it would be thirty-six years in June. In turn, Suriano commented "that's almost as long as I have been born," and further mentioned that he "swore he heard that she was retiring," on at least two other subsequent occasions.

On March 24, 2008, five of Lazzaro's family members, none of whom were Rite Aid employees, assisted Lazzaro in the Wilkinsburg store by helping her prepare the store for its upcoming inventory. Lazzaro claimed that she told Suriano about this, who said he would "look the other way this time." Suriano, however, denied having any conversations with Lazzaro about her family members working at the Wilkinsburg store. On March 25, Suriano gave Lazzaro a "Written Notice" as a result of the Wilkinsburg store's poor inventory performance.

On May 5, 2008, Suriano and Lynne Shawley, Rite Aid's Human Resources Manager, met with Lazzaro to discuss the Wilkinburg store's poor inventory performance. At this meeting, Suriano raised the issue of Lazzaro's family members working in the Wilkinsburg store. Lazzaro admitted that she had her family members perform work at the Wilkingsburg store, but stated that Suriano knew that it was happening. Suriano again denied having any knowledge of Lazzaro's family members working at the Wilkinsburg store prior to March 24, 2008. During this meeting, Shawley also commented to Lazzaro that she had heard that Lazzaro was "always complaining about aches and pains," and that she "was very slow to catch on to the new Rite Aid system." At the close of the meeting, Shawley informed Lazzaro that an investigation would be conducted regarding the extent to which she permitted her family members to work at the Wilkinsburg store.

Later, at Shawley's request, Lazzaro provided a written statement that approximated the amount of time her family members had worked at the Wilkinsburg store. Shawley then suspended Lazzaro for her alleged misconduct, but did not suspend Suriano for his alleged knowledge of Lazzaro's family members working at the Wilkinsburg store.

On June 2, 2008, Shawley submitted a recommendation to the Senior Resources Manager for Rite Aid that Lazzaro be terminated. Subsequent discussions between and among upper-level Human Resources individuals and management for Rite Aid Corporation approved Shawley's recommendation. At Shawley's instruction, Suriano called Lazzaro on June 3, 2008 and informed her that she had been terminated.

Following Lazzaro's termination, Rite Aid transferred a 25-year-old male to fill the Store Manager position at the Wilkinsburg store that had been vacated by Lazzaro. During her previous thirty-six years of employment, Lazzaro had never received any disciplinary action or performance warnings from Rite Aid or its predecessors.

On November 21, 2008, Lazzaro filed an EEOC charge against Rite Aid, alleging age and gender discrimination. Following the filing of Lazzaro's EEOC charge, Rite-Aid terminated at least four other store mamagers, aged 45, 37, 55 and 47, for permitting individuals who were not Rite Aid employees to perform work at their respective stores. Rite Aid then replaced these terminated store managers with individuals who were aged 27, 24, 34 and 57.

In her subsequent lawsuit, Lazzaro claimed that her discipline and termination were discriminatory actions against her based upon her age and/or gender, and that Rite Aid's reasons for terminating her were mere pretext. Rite Aid filed a motion for summary judgment, arguing that it had legitimately and properly terminated Lazzaro for permitting non-employees to work at the Wilkinsburg store and that Lazzaro had failed to establish any evidence of discrimination.

The District Court denied Rite Aid's motion for summary judgment, and permitted Lazzaro's claims to proceed to a jury. Contrary to Rite Aid's assertions, the Court held that Lazzaro had submitted enough conflicting evidence that could allow a jury to determine that Rite Aid's proffered reasons for terminating Lazzaro were mere pretext. Specifically, the Court noted that: (1) during Suriano's first visit to the Wilkinsburg store, he had made comments about Lazzaro retiring and about her age; and (2) during the May 5, 2008 meeting, Shawley had made comments about Lazzaro complaining about aches and pains and being "slow to catch on to the new Rite Aid system." The Court also found that there existed a factual dispute as to whether or not Suriano actually knew that Lazzaro's family members were working at the Wilkinsburg store. The Court noted that the determination of this factual dispute could allow a jury to draw reasonable inferences as to whether Lazzaro's disparate treatment was meritorious, and could enable them determine whether Rite Aid treated Suriano, a younger male, differently than Lazzaro, an older female.

The Court also pointed to the fact that Lazzaro was the first store manager fired for allowing non-employee family members to work at her store. And, there was no evidence offered to establish that Rite Aid had a policy prohibiting non-employees from volunteering their services, nor any Rite-Aid policy that permitted immediate termination for allowing such an activity.

Ultimately, the Court concluded that it was the jury's job to determine whether Rite Aid was using terminations for violations of an unwritten company policy as pretext, thus promoting the inference that a pattern of terminations existed where older store managers were being replaced with younger ones. Put another way, "[s]imply providing the Court with evidence that defendant has terminated other store managers for the same reason as [Lazzaro] in no way legitimizes a pattern of termination that a reasonable fact-finder may otherwise conclude is pretext."

Third Circuit: Employer Who Fired Workers For Poor Performance While Allegedly Engaging In Discriminatory Training Methods May Be Liable For Discrimination

2010-10-25T17:03:00.001-04:00

In Grassmyer, et al. v. Shred-It USA, Inc., No.: 09-3876 (3d. Cir. 8/25/2010), the Third Circuit Court of Appeals held that in a sex discrimination claim under Title VII, a plaintiff can rebut an employer's allegedly nondiscriminatory reason for terminating the plaintiff due to poor performance, by setting forth evidence that the employer failed to provide plaintiff the same training and assistance opportunities available to other employees of the opposite sex.

In Grassmyer, three plaintiffs, all female, sued their former employer, Shred-It USA, Inc., claiming that Shred-It illegally discriminated against them on the basis of their sex, in violation of Title VII. Two of the plaintiffs had been fired by Shred-It for failing to meet specifically designated monthly sales quotas. The third plaintiff resigned claiming that she had been constructively discharged. All three plaintiffs admitted that they had failed to perform the minimum monthly sales quotas required of them. Nevertheless, the plaintiffs claimed that Shred-It had discriminated against them when it: (1) did not terminate male sales representatives who were performing comparably or worse than the plaintiffs; (2) applied sales quotas unevenly among male and female sales representatives; and (3) discriminated on the basis of sex in matters such as training, territory assignments and performance requirements.

The trial court dismissed plaintiffs' claims, finding that over the five previous years, Shred-It had terminated seven male sales representatives and only four female sales representatives, and this fact would thus prevent any rational jury from finding that plaintiffs were terminated because of their gender. The trial court also found that plaintiffs' allegations of discrimination with respect to the allocation of sales territories was not actionable due to the undisputed fact that the plaintiffs were unable to meet their sales quotas, and also concluded that the plaintiffs failed to present any evidence whatsoever that the actions by Shred-It with respect to training opportunities "occurred because of invidious gender discrimination."

On appeal, the Third Circuit reversed the trial court's ruling that plaintiffs had failed to set forth a viable sex discrimination claim against Shred-It. Specifically, the Court recognized that the plaintiffs had introduced testimony that conflicted with the evidence set forth by Shred-It as to how training programs and opportunities were provided and how sales territories were assigned. The Third Circuit held that Shred-It's reason for terminating two of the plaintiffs - failure to meet their minimum required sales quotas - did not automatically become legitimate and non-discriminatory simply because plaintiffs' performance failure was undisputed. Rather, the plaintiffs had introduced sufficient evidence to allow a jury to conclude that the reason why plaintiffs had failed to meet their required sales quotas was because they were improperly denied training opportunities and superior sales territories that were provided by Shred-It to its similarly situated male employees. The Court reaffirmed the rule that an employer who discriminates on the basis of a protected class by failing to provide an employee with sufficient training, cannot then automatically escape liability under Title VII by subsequently terminating that employee for poor performance.

The Court also rejected the trial court's reliance upon Shred-It's past termination record of both male and female sales representatives, noting that "Shred-It's past employment statistics say nothing about the training and territory allocations of the male and female sales representatives who were terminated over the last five years or whether Shred-It otherwise discriminated against women in ways that affected their ability to meet the sales quotas, as is alleged here." Furthermore, the Court recognized that even if Shred-It's past employment statistics conclusively demonstrate no past discrimination of women, that would not immunize Shred-It from all present and future claims of discrimination.

The Third Circuit's full opinion in Grassmyer may be read here: http://www.ca3.uscourts.gov/opinarch/093876np.pdf

Federal Court Dismisses ADA and FMLA Claims Against Wal-Mart

2010-10-25T09:55:00.003-04:00

On August 26, 2010, in the case of Stoppi v. Wal-Mart Transportation, LLC, No.: 3:09-cv-916 (M.D. Pa. 2010), District Judge James M. Munley dismissed plaintiff's claims of employment discrimination and harassment against Wal-Mart Transportation under the Americans with Disabilities Act (ADA), but allowed plaintiff's claims of retaliation under the ADA and Family Medical Leave Act (FMLA) to proceed.

Plaintiff, Kimberly Stoppi, was hired by Wal-Mart Transportation, LLC in 2006 as a Driver Coordinator/Router position. Stoppi had been diagnosed with bipolar disorder in her early thirties, but did not reveal her diagnosis to Wal-Mart at the time she was hired.

Prior to November of 2007, Stoppi spoke with her supervisor and asked to be seated away from a window while she adjusted her medication, because taking her medication weakened Stoppi's eyesight and made her hands unsteady. Stoppi testified that her supervisor refused this request and insisted that she perform one-hundred percent or take a leave of absence. Other supervisors repeated this instruction and Stoppi instead stopped taking her medication, and suffered as a result.

Wal-Mart granted Stoppi a leave of absence related to her medical condition in November 2007 until December 2007. When Stoppi returned to work in December of 2007, there was a vacancy in a management position in the facility. A Human Resources Manager for Wal-Mart told Stoppi of the position and asked her if she wanted to interview for the job. While Stoppi was allegedly enthusiastic about applying for the position, Wal-Mart chose not to grant Stoppi an interview. Stoppi contended that she was well-qualified for the position, had nearly five years of transportation experience, had trained new employees and was already in a management position. Stoppi also argued that the employees who did receive interviews lacked the experience in transportation that she had - one had worked for a bingo hall prior to working for Wal-Mart and another had worked in a dentist's office. Wal-Mart contended that Stoppi lacked recent supervisory or management experience, and that it exercised business judgment in choosing to interview other employees with more relevant experience. Ultimately, Wal-Mart did not fill the management position.

After her return to work in December of 2007, Stoppi also claimed that she had been subject to a hostile work environment because of her disability. Specifically, Stoppi referenced five incidents: (1) on December 27, 2007, a driver commented in the breakroom in front of Stoppi that workers can get a "mental leave" at Wal-Mart; (2) on January 13, 2008, another driver saw Stoppi crumple a piece of paper and asked if she was having a "bipolar moment"; (3) Stoppi had heard other workers talking about taking medications, "looney bins" and "going postal" around the workplace; (4) In November of 2008, a driver asked Stoppi if she had forgotten to "take her pill," and in December, the same driver told Stoppi "I see you took your prozac"; and (5) in March of 2008, Stoppi's coworker gave her a coffee mug with the character "Dopey" on it. Stoppi did not report all of these incidents to management or complain about inappropriate comments, as she felt that Wal-Mart would not remedy the situation. Stoppi did complain to one of her managers about the "Dopey" mug, who laughed when Stoppi complained. Stoppi also contended that Wal-Mart's Human Resources Department "leaked" the information concerning her illness to her supervisors.

Stoppi filed claims against Wal-Mart for (1) discrimination under the ADA, (2) harassment under the ADA, and (3) retaliation under the ADA and FMLA. Under her first claim, Stoppi alleged that Wal-Mart discriminated against her because of her disability when it refused to grant her an interview for a position for which she was clearly qualified. Under her second claim, Stoppi alleged that the various comments and actions by the drivers and coworkers set forth above created a hostile work environment that was detrimental to her. Finally, Stoppi claimed that Wal-Mart's failure to grant her an interview and promote her to the vacant management position constituted retaliation for her earlier requests for accommodation and her subsequent medical leave.

The Court granted Wal-Mart's motion for summary judgment on Stoppi's first two claims, and dismissed them. With respect to Stoppi's ADA discrimination claim, the Court held that Stoppi had failed to establish an adverse employment action necessary for a discrimination claim, because it was undisputed that Wal-Mart did not promote anyone. Relying upon a prior decision by the Third Circuit, which held that a plaintiff who did not receive a non-existent employment position could not establish a case of Title VII retaliation, the District Court held that since Wal-Mart had ultimately decided not to fill the vacant management position at all, any failure to grant Stoppi and interview cannot constitute an adverse employment action, as a matter of law.

With respect to Stoppi's claim for harassment under the ADA, the District Court held that while Stoppi may have considered the comments by the Wal-Mart employees to be "hostile," the conduct was not objectively severe enough for a jury to find the existence of a hostile environment. The incidents that Stoppi complained of amounted to an infrequent few over a two-year period, and Stoppi did not point to any evidence that this conduct unreasonably interfered with her job performance.

The District Court, however, permitted Stoppi's retaliation claims under the ADA and FMLA to proceed, holding that Stoppi's argument that the stated reasons for refusing to interview her for the vacant management position were mere pretext, could be accepted by a reasonable jury. Wal-Mart's claim was that Stoppi was denied an interview because she allegedly lacked recent supervisory experience, but Stoppi introduced evidence that those who actually were interviewed had less supervisory experience than she did. As such, the Court held that a jury could find that the stated reason for Wal-Mart's employment decision - Stoppi's lack of experience - was not the real reason. Thus, the Court permitted Stoppi's retaliation claim to proceed.

PA Superior Court: Restrictive Covenants Survive Purchase of Membership Equity Interests of LLC

2010-10-19T09:32:00.001-04:00

In Missett v. HUB International Pennsylvania, Inc., 2010 PA Super 178 (9/23/2010), the Pennsylvania Superior Court held that when a Limited Liability Company (LLC) sells all of its membership equity interests to another business entity, a restrictive covenant (or covenant not to compete) that was previously entered into by an employee of the LLC, will survive without the need for specific assignment language in the restrictive covenant.

In HUB International, Christopher Missett became employed by Clair Odell Insurance Agency, LLC ("Clair Odell") as a salesperson in the company's benefits department. In this capacity, Missett originated business for Clair Odell, negotiated with potential clients and worked with existing clients to meet their coverage and services needs. In 2000, Missett entered into an agreement with Clair Odell that contained a non-solicitation clause, which prevented Missett from soliciting Clair Odell's clients or prospective clients for two years following the date of his termination.

In 2001, Citizens Financial Group ("Citizens") purchased the membership interests of Clair Odell, and changed the name of the company to Citizens Clair Insurance Company, LLC ("Citizens Clair"). In December of 2002, Missett entered into a second Agreement that amended and restated the original 2000 Agreement, and which contained the same confidentiality and non-solicitation provisions as the 2000 Agreement.

In 2006, HUB U.S. Holdings, Inc. ("HUB U.S.") entered into a Purchase and Sale Agreement with Citizens, in which it acquired all of the issued and outstanding membership equity interests of Citizens Clair. The name of the company was then changed to Hub International Pennsylvania, LLC ("HUB Pa"). The Purchase and Sale Agreement required the companies to abide by the terms of any existing employment agreements that were attached as exhibits. Missett's 2002 Agreement was specifically included as an exhibit to the Purchase and Sale Agreement.

Missett was terminated on April 29, 2008. The stated reason for his termination was that HUB Pa did not want to pay his high commission schedule.

Missett subsequently initiated litigation seeking to enjoin HUB Pa from enforcing the non-solicitation agreement and requesting a declaration from the court that his 2002 Agreement was unenforceable. Missett argued that pursuant to the Pennsylvania Supreme Court's decision in Hess v. Gebhard & Co., Inc., 808 A.2d 912 (Pa. 2002), a restrictive covenant not to compete that is contained in an employment agreement is not assignable to a purchasing business entity in the absence of a specific assignability provision, where the covenant is included in the sale of assets. While Missett's Agreement in this case did contain an assignment provision, it limited such an assignment only to "affiliates" of the company, of which HUB Pa was not. As such, (according to both Missett and the trial court below), the non-solicitation provision of the 2002 Agreement was unenforceable by HUB Pa.

The Superior Court disagreed, reversed the trial court's decision in favor of Missett, and remanded the case for further proceedings. The Court held that the Supreme Court's decision in Hess was distinguishable and not controlling, because the reasoning in Hess was clearly premised upon a "sale of assets" of a corporation, as opposed to the sale of stock. The Superior Court noted that other decisions from the Superior Court and from the federal bench, namely J.C. Ehrlich Co., Inc. v. Martin, 979 A.2d 862 (Pa. Super. 2009), Siemens Medical Solutions Health Services Corp. v. Carmelengo, 167 F.Supp.2d 752 (E.D. Pa. 2001) and Zambelli Fireworks Manufacturing Co., Inc. v. Woods, 592 F.3d 412 (3d. Cir. 2010), all recognized that under Pennsylvania law, a transfer of a corporation's stock does not destroy the corporate entity, because "a corporation is an entity irrespective of, and entirely distinct from, the persons who own its stock." In other words, even when a corporation's stock is purchased by an outside entity and the name of the corporation is changed, the corporate entity nevertheless remains the same. The Superior Court held that "the structure of a sale of equity membership interests," of an LLC is "akin to a sale of stock rather than an asset sale," and therefore, the reasoning of Ehrlich, Carmelengo and Zambelli were applicable and controlling.

As such, the Superior Court concluded that because HUB Pa had acquired Citizens Clair via the purchase of Citizen Clair's membership equity interests, and not by purchasing its assets, no assignment provision was required in order for HUB Pa to enforce the terms and provisions of Missett's 2002 non-solicitation Agreement.

You can read the Superior Court's full opinion in HUB International here: http://www.superior.court.state.pa.us/opinions/a16035_10.pdf

PA Superior Court Affirms Award of $210,704.79 in Attorneys' Fees Under Wage Payment & Collection Law

2010-10-11T11:20:00.000-04:00

In Ambrose v. Citizens National Bank of Evans City, No.: 10-3156 (Pa. Super. 9/17/2010), the Pennsylvania Superior Court held that the Wage Payment and Collection Law permits a trial court to make an award of attorneys fees incurred by a successful plaintiff in defending against an employer's counterclaim, where that counterclaim is "inextricably intertwined" with plaintiff's wage claim.

In Ambrose, the plaintiffs sued their former employer under the Pennsylvania Wage Payment and Collection Law, arguing that the employer failed to pay to plaintiffs commissions that were due, and sought compensation, interest, liquidated damages and attorneys fees. The employer filed a counterclaims, alleging unfair competition, breach of fiduciary duties and conspiracy. After trial, the lower court found in favor of the plaintiffs and awarded them $210,704.79 in attorneys fees. Specifically, the trial court determined that employer's counterclaims were without merit, and were pursued by employer for the purpose of intimidating plaintiffs into dropping their wage claims.

Employer appealed, arguing that the trial court committed multiple errors, such as: (1) awarding attorneys' fees to plaintiffs for work performed in defending against employer's counterclaims; (2) including in its calculation of attorneys fees the work performed by plaintiffs' attorneys on appeal; and (3)awarding an unreasonable sum of attorneys' fees.

The Superior Court rejected employer's arguments and affirmed the trial court's award of the attorneys' fees. Specifically, the Superior Court held that the trial court's inclusion of the time plaintiffs were forced to spend defending employer's counterclaims was properly counted in calculating the award of attorneys' fees, because employer's counterclaims were "inextricably intertwined," with plaintiffs' wage claims so as to fall under the fee-award provision of the Wage Payment and Collection Law. The Court also held that awarding attorneys fees for work performed through the appeal process was also proper because including such fees furthers the legislative purposes behind the Wage Payment and Collection Law of making employees who are denied compensation whole. Finally, the Court held that the employer had failed to introduce sufficient evidence to challenge the reasonableness of the hourly rates or fees that were submitted by the plaintiffs and relied upon by the trial court in calculating the final award of attorneys' fees.

Consequently, the Court affirmed the trial court's award of $210,704.79 in attorneys fees against the employer.

The Superior Court's full opinion can be read here: http://www.superior.court.state.pa.us/opinions/A09027_10.pdf

Commonwealth Court: Preschool Teacher Fired For Leaving Child Unattended For Four Minutes In Violation of Employer's 100% Supervision Rule Not Entitled To Unemployment Compensation Benefits

2010-10-11T10:28:00.000-04:00

In Oliver v. Unemployment Comp. Bd. of Review, No.: 1798 C.D. 2009 (Pa. Cmwlth. 9/1/2010), the Commonwealth Court affirmed a finding of the Unemployment Compensation Board of Review that denied claimant unemployment compensation benefits after claimant was fired from a preschool for violating the school's 100% child supervision policy.

The claimant was a preschool teacher. On February 26, 2009, claimant took her group of six children from the playroom to an outdoor play area. The employer had a policy that a teacher must supervise all of the children in her charge at all times, without exception (the "100% supervision policy"). After claimant had taken her children to the outdoor play area, claimant's supervisor noticed that one child had remained behind in the playroom. She retrieved the child and brought him to the claimant. The supervisor asked claimant how many children she had, and the claimant stated that she had six. The supervisor responded that "no ... you have five, because here is your sixth one." The supervisor reported the incident to claimant's superiors, and claimant was terminated that day for violation of the 100% supervision policy.

Claimant subsequently applied for unemployment compensation benefits, arguing that she had made an honest mistake in violating the 100% supervision policy, and as such, her actions could not constitute "willful misconduct." Claimant testified that when she brought the children outside, she had not realized that one had remained behind in the playroom because she had been distracted by falling into a piece of play equipment in the playroom. Claimant also testified that the child was only left alone for approximately four minutes. Claimant also stated that she was aware of employer's 100% supervision rule, and admitted that she had received a verbal warning for violating that policy back on February 13, 2009. The Unemployment Compensation Board of Review did not find claimant's testimony to be credible, and instead concluded that claimant had engaged in willful misconduct when she violated employer's 100% supervision rule.

On appeal, the Commonwealth Court affirmed the decision of the Board of Review denying claimant's application for benefits. The Court noted that the Board is the ultimate fact-finding body and is empowered to resolve all conflicts of evidence and determine the credibility of witnesses and the weight of the evidence. The Court recognized that the Board had found claimant's testimony internally inconsistent and not credible, and as such, the Court was not empowered to disturb that finding. However, the Court also noted that even if the claimant did stumble and accidentally lose track of the child, she admitted to not counting the children when she first brought them outside, as was required under the employer's 100% supervision policy. As such, even if her actions in losing track of the child constituted an honest mistake, it did not justify claimant's violation of employer's 100% supervision policy. The Court thus held that claimant had violated her employer's rule without establishing good cause for doing so and the Board of Review did not err in denying claimant's application for unemployment compensation benefits.

The Commonwealth Court's full opinion can be read here: http://www.aopc.org/OpPosting/Cwealth/out/1798CD09_9-1-10.pdf

Commonwealth Court: Claimant Entitled To Unemployment Compensation Benefits After Leaving Work While Upset

2010-10-11T09:23:00.001-04:00

In Procyson v. Unemployment Comp. Bd. of Review, No. 1771 C.D. 2009 (Pa. Cmwlth. 9/22/2010) , the Pennsylvania Commonwealth Court reversed a finding by the Unemployment Compensation Board of Review that denied unemployment compensation benefits to a claimant due to a finding that the claimant had voluntarily quit her job after abruptly leaving following comments made by claimant's supervisor about claimant's job performance that made claimant visibly upset.

Claimant worked full-time for her employer from 11/2007 through 11/2008, when she was injured in a biking accident, which caused her to miss five weeks of work. Claimant then returned to work on a part-time basis with medical restrictions. During both her absence from work and her part-time schedule, the employer's general manager hired her brother to fill in for claimant's missed time. In early January of 2009, claimant was cleared by her doctor to return to work full-time. While at work on January 9, 2009, claimant called the general manager and requested to return to a full-time schedule. The general manager told claimant that she would have to talk to some other people, including employer's president, about claimant's request for a return to a full-time schedule. The general manager then told claimant that both she and the pharmacist agreed that the general manager's brother was able to do claimant's job faster than the claimant.

Claimant became very upset about these comments, and began to cry. She then gathered her belongings, called the pharmacist "two-faced," and left. The pharmacist followed claimant through the building and into the parking lot, telling claimant "don't leave like this." Claimant shouted back "no, leave me alone," and left. At no time did claimant ever say "I quit."

Claimant then reported for her next scheduled shift on Tuesday, January 13, 2009. When she arrived at work, she was called to the president's office, who (according to claimant) accused claimant in a loud voice of yelling and screaming in the store the previous Friday. The president then told claimant that she was fired, should leave and never come back.

Claimant then applied for unemployment compensation benefits, and was denied. At a hearing before the Referee, the Claimant admitted that she had walked out without completing her shift, but denied she had quit. Rather, she explained that she went home because she did not want the customers to see her upset and crying. Claimant testified that she loved her job and would never quit.

The Referee denied claimant unemployment compensation benefits, finding that claimant had abandoned her position and did not take reasonable steps to preserve her employment. Similarly, the Board of Review found that claimant had voluntarily terminated her employment on January 9, 2009 when she walked out of work while giving her employer "no inkling that she intended to return." The Board of Review also found that claimant's walking out of work because of comments by claimant's supervisor about her job performance did not constitute "necessitous and compelling reasons to quit."

On appeal, the Commonwealth Court reversed, and found that claimant was entitled to unemployment compensation benefits. Specifically, the Court emphasized that Pennsylvania law requires "evidence of a conscious intention to abandon a job," and that claimant "never expressed such a conscious intention." The Court agreed with claimant's argument that "the fact that a claimant leaves work before the end of a shift does not, in itself, establish an intent to quit." Here, the Court found that claimant was attempting to return to work full-time when the altercation occurred, and that on the day in question, she never said "I quit." And, while claimant did leave work on Friday January 9, she attempted to return to work for her next scheduled shift on Tuesday January 13. The Court noted that it was not reasonable to infer that by not calling her employer during her scheduled days off, claimant had expressed an intent to quit. Rather, the Court recognized that the employer "had the opportunity to contact the employee, but chose, instead, to drop Claimant from the Tuesday schedule without calling her." The Court held that by returning to work the following Tuesday, claimant "acted to preserve the employment relationship." The Court ultimately determined that it was the actions of the president in firing claimant on Tuesday January 13, which terminated claimant's employment, not her leaving work the Friday before. As such, the claimant was entitled to unemployment compensation benefits.

The Commonwealth Court's full opinion is available here: http://www.aopc.org/OpPosting/Cwealth/out/1771CD09_9-22-10.pdf

Third Circuit Rejects Application of Fair Pay Act To Failure-To-Promote Claims

2010-10-04T12:38:00.001-04:00

On October 1, 2010, in the case of Noel v. The Boeing Company, No.: 08-3877, the Third Circuit Court of Appeals held, in a case of first-impression, that the provisions of the Lilly Ledbetter Fair Pay Act of 2009 (FPA) do not apply to discrimination claims under Title VII, even when an alleged failure to promote an employee results in lower compensation being paid to that employee as a consequence.

By way of background, Congress passed the FPA in direct response to the U.S. Supreme Court's decision in Ledbetter v. Goodyear Tire & Rubber Co., Inc., in which the Court held that an employer's alleged discriminatory decision that resulted in an employee's pay being set at a certain rate, constituted a "discrete act" of discrimination under Title VII, which triggered the running of the statute of limitations. In Ledbetter, for example, Ms. Ledbetter had been employed at Goodyear from 1979 until 1998. At trial, she proved that throughout her employment, her supervisors evaluated her poorly because of her sex, which resulted in her receiving lower pay than if her evaluations had been free of discrimination. She also proved that these discriminatory pay decisions affected her pay throughout the course of her employment, resulting in a salary that was less than her male peers. In dismissing her case as barred by Title VII's statute of limitations, the U.S. Supreme Court held that her claims for sex discrimination began to run when Goodyear made the alleged discriminatory evaluations. The Court rejected Ms. Ledbetter's argument that a distinct and seperate claim against Goodyear actually accrued each time she received a paycheck that was less than it should have been because of the discriminatory decisions she complained about.

In direct response to this decision, Congress passed the FPA, which amended Title VII. Now, each paycheck that stems from an alleged discriminatory compensation decision or pay structure constitutes a "tainted, independent employment-action that commences the administrative statute of limitations." In other words, if an employee is not receiving "equal pay for equal work," as a consequence of an employer's discriminatory employment decision or policy, then each paycheck received by the employee constitutes a discrete discriminatory action that carries with it its own administrative statute of limitations.

In Noel, the Third Circuit was asked to apply the provisions of the FPA to an employee's claims that his employer discriminated against him by failing to promote him to a position for which he was qualified. Specifically, Noel claimed that his employer's failure to promote him because of discriminatory reasons occurred in July and September of 2003. But, Noel did not file an administrative claim with the EEOC until March of 2005, well after the exhaustion of his 300-day administrative statute of limitations period. Noel argued on appeal that the district court improperly dismissed his case because the provisions of the FPA operated to renew his claims for failure-to-promote everytime he received a paycheck that was lower than it should have been as a consequence of that non-promotion.

The Third Circuit disagreed and affirmed the dismissal of Noel's claims. First, the Court held that Noel was pursuing a failure-to-promote claim, as opposed to a discrimintation-in-compensation claim. The Court noted that Noel did not allege a nexus between his employer's decision not to promote him and any resultant disparate compensation, nor did he allege that he received less pay than his white peers for work performed at the same grade level. Noel simply argued that he was denied his promotion for discriminatory reasons; but, had he received that promotion in the absence of discrimination, he would have received more pay. In other words, Noel never argued that he did not receive "equal pay for equal work."

The Court also looked to a decision from the D.C. Circuit Court of Appeals, and held, as a matter of law, that the FPA does not apply to failure-to-promote claims. The Court determined that the intent of Congress in passing the FPA was to address a particular type of discriminatory compensation decisions, which are often concealed and not discovered until long after Title VII's 180 or 300-day limitations period has expired. Promotion decisions, on the other hand, are discrete employment actions in and of themselves, which are readily ascertainable eitehr at the time they are made, or shortly thereafter. And, because the FPA was passed in direct response to the U.S. Supreme Court's decision in Ledbetter, the Court saw no reason to expand the scope of the FPA beyond claims for disparate compensation.

A copy of the Third Circuit's full opinion in Noel can be found here: http://pacer03.ca3.uscourts.gov/opinarch/083877p.pdf

Federal Court Rejects Employer's Claim of "Rolling" FMLA Policy and Allows Employee's FMLA Suit To Go To Trial

2010-09-14T10:07:00.003-04:00

In a recent decision handed down in the case of MacFarland v. Ivy Hill, No.: 09-cv-2246 (E.D. Pa. 7/28/2010), the U.S. District Court for the Eastern District of Pennsylvania denied an employer's motion for summary judgment in a claim brought against it by a former employee who alleged that he was terminated in violation of his leave rights under the Family Medical Leave Act (FMLA). The issue before the court was whether the employee's FMLA leave expired on April 8, 2008, or sometime thereafter.

Plaintiff, Alan MacFarland, was an employee of Ivy Hill, who was eligible for FMLA leave. On October 23, 2007 Mr. MacFarland took two weeks of FMLA leave through November 7, 2007. In January of 2008, Mr. MacFarland suffered a stroke and requested FMLA leave, which listed his anticipated date of return as April 8, 2008. Plaintiff later testified that he told Ivy Hill that his April 8, 2008 doctor's appointment in which he was to recieve clearance to return to work, had been rescheduled for April 16, 2008. Plaintiff also testified that he was never informed by Ivy Hill that he would be terminated if he did not return to work by April 8, nor was he ever told by Ivy Hill that he was not eligible for additional FMLA leave past April 19, 2008.

Mr. MacFarland did not report to work on April 8, 2008, and on April 10, Ivy Hill terminated Mr. MacFarland for failing to do so. Mr. MacFarland sued, alleging improper interference with his FMLA leave rights. Specifically, Mr. MacFarland argued that he was entitled to 12 weeks of FMLA leave beginning in January of 2008, i.e., 12 weeks per calendar year, and as such, the FMLA leave following his stroke did not expire until well after April 8, 2010.

Ivy Hill argued that it employed a "rolling" FMLA period for the company, which did not run on a calendar-year basis, but provided that an employee's available FMLA leave would be counted backwards from the first date the employee took approved FMLA leave. So in this case, for example, Ivy Hill maintained that Mr. MacFarland's 12-week FMLA allowance was properly calculated beginning with his two-week FMLA leave from October 23 through November 7, which left Mr. MacFarland with 10 weeks of FMLA leave remaining when he went out in January, 2008. Therefore, his FMLA leave for his stroke would have expired on April 8, 2010.

The Court rejected Ivy Hill's argument, finding that despite its claims, Ivy Hill had failed to introduce any evidence establishing its official policy concerning FMLA leave time. While it appeared that Ivy Hill had employed a "rolling" method of calculating Mr. MacFarland's FMLA leave time, it did not produce "any evidence that demonstrated that this policy was officially chosen or that it was the policy that was applied to all employees." The Court noted that Mr. MacFarland also testified that he was never specifically informed by Ivy Hill that his FMLA leave would expire on April 8, nor that his leave could not be extended. In denying Ivy Hill's motion for summary judgment, the Court noted that while an employer is free to determine the twelve-month period in which its employees are eligible for their 12 weeks of FMLA leave, if the employer fails to make a selection, the method of calculation that is most favorable to the employees will be applied.

Therefore, an employer needs to make sure that if it chooses to select the method of calculation for eligible employees' FMLA leave, its selection needs to be properly documented and applicable to all employees. An employer should also make sure that it informs all of its employees of the selection and get employees to acknowledge that they have been so informed of the selection.

Third Circuit Clarifies Definition Of "Commissions" Under FLSA

2010-09-07T22:27:00.002-04:00

In Parker v. NutriSystem, Inc., the Third Circuit was asked to rule on the validity of the compensation plan offered by NutriSystem to its call-center employees. In holding that NutriSystem's employee compensation plan did not violate the Fair Labor Standards Act (FLSA), the Court clarified what constitutes a "commission" for purposes of the FLSA.

NutriSystem's plan compensated its call-center employees using one of two methods: (1) an hourly rate of $10/hour with overtime work compensated at $15/hour; or (2) payment of a flat-rate for each NutriSystem meal plan sold to consumers, which varied from $18 to $40 depending upon the time of day the meal plan was sold and whether such a sale was completed by an incoming or outgoing call. The majority of the employees in NutriSystem's call center were compensated using this second method.

The FLSA provides for an exception for employees in the retail or service industries whose compensation is more than one and one-half times the federal minimum wage and at least half of which represents commissions on goods or services. The plaintiffs, NutriSystem call-center employees, filed suit against NutriSystem arguing that the "flat-rate" payment option described above violated the FLSA because it did not constitute a "commission." Specifically, the plaintiffs argued that in order to be a "commission" under the FLSA, payments received by employees must be based upon the final cost to the consumer. Since the flat rates under the NutriSystem plan were based upon the times of day the sales were completed and whether those sales were originated via incoming or outgoing calls, the payment method did not constitute "commissions."

The Third Circuit disagreed, and held that so long as flat-rate payments made to an employee based on sales are proportionally related to the charges passed on to the consumer, those payments may be considered "commissions" for purposes of the FLSA. The Court specifically refused to adopt a test that required a "commission" under the FLSA to be strictly based on a percentage of the end cost to the consumer.

In this case, the Court held that because NutriSystem's flat-rate plan constituted a "commission" under the FLSA because: (1) the payments available to call-center employees were proportionally related to the costs of the various meal plans charged to consumers; (2) the plan clearly made compensation under the plan contingent upon sales made by call-center employees;(3) under the public policy goals of the FLSA it was reasonable for NutriSystem to offer different commissions depending upon the time of the sale and whether the sale was the result of an incoming or outgoing call, because such a pay structure encouraged staff to take undesirable shifts and work harder on closing sales on outgoing calls; and (4) the purposes of the FLSA were not offended by NutriSystem's flat-rate plan, because the call-center employees at issue were not the lower-income employees the FLSA was enacted to protect, employees must meet certain goals in order to be eligible to earn higher payment rates, and working long hours in a call-center does not carry with it the same danger of fatigue, health risks or accidents that can occur to manual labor employees.

You can read the Court's full opinion here: http://www.ca3.uscourts.gov/opinarch/093545p.pdf

Third Circuit Upholds Ban On Islamic Religious Head Scarves For Prison Guards

2010-08-09T09:44:00.002-04:00

In the case of EEOC v. The GEO Group, Inc., No.:09-3093 (8/2/2010) , the Third Circuit Court of Appeals held that a uniform policy mandated in the George W. Hill Correctional Facility in Delaware County, PA, which prohibits prison guards from wearing Muslim head coverings, called khimars, in the prison did not constitute religious discrimination under Title VII.

Relying upon its previous decision in Webb v. City of Philadelphia, 562 F.3d 256 (3d. Cir. 2009), the Court deferred to the arguments made by the prison that allowing any headwear to be worn by prison guards, including khimars, would constitute a substantial security risk to individuals in the prison and that any policy allowing such headwear to be worn but switched or checked at various security checkpoints, would be implausible and time consuming. The Court noted that with respect to decisions involving security and safety, it would "not substitute our judgment for that of correction facility officials." As such, the Court held that the prison's ban on all religious headwear in this instance did not constitute religious discrimination under Title VII.

You can read the full text of the Court's opinion by clicking here: http://www.ca3.uscourts.gov/opinarch/093093p.pdf

Third Circuit: Complaining About ERISA Violations When No One Asks? You Can Lose Your Job.

2010-07-01T11:13:00.001-04:00

On June 24, 2010, the Third Circuit Court of Appeals held, in the case of Edwards v. A.H. Cornell and Son, Inc., that unsolicited internal complaints by employees about alleged employer violations of ERISA are not protected under ERISA's anti-retaliation provision. In so doing, the Court held that the employer's termination of its HR manager after she made complaints to her supervisors about alleged ERISA violations by the employer that she had uncovered, was not illegal.

The plaintiff, Shirley Edwards, was the HR director for A.H. Cornell and Sons, Inc.. In early 2009, she discovered that A.H. Cornell was allegedly engaging in numerous ERISA violations, such as allegedly administering the group health plan on a discriminatory basis, misrepresenting to some employees the cost of coverage in order to dissuade employees from opting in, and enrolling non-citizens in its ERISA plans by providing false social security numbers and other fraudulent information to insurance carriers. Edwards objected to and complained about these alleged violations to her supervisors. As a result of her complaints, she was fired.

Edwards then filed suit, claiming that her termination was illegal under the federal ERISA law, which makes it unlawful for an employer "to discharge, fine, suspend, expel or discriminate against any person because he has given information or has testified or is about to testify in any inquiry or proceeding," relating to ERISA or group health plans. Edwards argued that her complaints about A.H. Cornell's alleged ERISA violations fell squarely within the protection of this provision, and as such, her subsequent termination was illegal.

The Third Circuit disagreed, and held for the first time that the ERISA "whistleblower" protection language quoted above only applies when the complaining employee does so in the context of an "inquiry or proceeding," and that the phrase "inquiry or proceeding" is limited to formal actions, not unsolicited day-to-day complaints made in the course of one's employment. The Court noted that, in this case, Edwards' complaints to her supervisors were not requested or asked for, and were unconnected with any internal or external investigation or probe. Rather, Edwards made her complaints by her own choice in her role as the HR representative. And, in doing so, was clearly not "testifying" or "giving information" in the context of a formal hearing or process. As such, Edwards' complaints did not fall under the protection of the ERISA anti-retaliation provision, and offered her no protection for continued employment.

If you are an HR representative in Pennsylvania, be aware of the fact that you can now be terminated or otherwise disciplined for complaining to a supervisor or manager about alleged ERISA violations in your company, unless your complaints are made in the context of a formal inquiry or proceeding. The troubling part about this case is that it practically allows for no recourse by a conscientious HR representative to remedy or complain about such conduct by their employer that the HR representative discovers, if he or she is truly interested in keeping his or her job. Based solely upon the language of the ERISA statute, the Court's legal logic in this case is intellectually sound. But, the practical implications and repurcussions of the Court's holding are decidedly less so. Hopefully, Congress will take note of this decision, along with the other Circuits that have addressed this same issue, and amend the ERISA law to clearly prohibit retaliation even in such informal circumstances. Until that day, however, my advice to all HR representatives or other employees who find themselves in this quandry? Tread lightly. And, be careful what you complain about and who you complain to.

You can read the Court of Appeals' Opinion in Edwards v. A.H. Cornell and Son, Inc., here: http://pacer03.ca3.uscourts.gov/opinarch/093198p1.pdf

Dept. of Labor Holds That Same-Sex Couples Have FMLA Rights For Child Leave

2010-06-29T12:38:00.001-04:00

In a decision published on June 22, 2010, the U.S. Department of Labor formally clarified that the phrase "a parent standing in loco parentis," to a child for purposes of FMLA leave encompasses all individuals who exercise day-to-day responsibilities to care for and financially support a child, regardless of that person's biological relationship to the child.

An eligible employee may request FMLA leave for the birth of a son or daughter or to care for a son or daughter with a serious health condition. The FMLA statute defines "son and daughter" as including within its scope "a child of a person standing in loco parentis." The DOL regulations further define "in loco parentis" to include those indiviuals who provide day-to-day care and financial support for a child. In its June 22 decision interpreting this regulation, the Department formally stated that "employees who have no biological or legal relationship with a child may nonetheless stand in loco parentis to the child and be entitled to FMLA leave." In providing examples of this interpretation, the Department stated that "an employee who will share equally in the raising of an adopted child with a same sex partner, but who does not have a legal relationship with the child, would be entitled to leave to bond with the child . . . because the employee stands in loco parentis with the child." The Department also noted that in situations where a child's biological parents divorce and then each remarries, the two biological parents and the two non-biological step-parents would all have "equal rights to take FMLA leave to care for the child."

The Department also noted that when an employer has questions as to whether an employee's relationship is covered under the FMLA, the employer may require the employee to provide "reasonable documentation or statement of the family relationship."

A link to the full Department of Labor decision can be found here: http://www.dol.gov/whd/opinion/adminIntrprtn/FMLA/2010/FMLAAI2010_3.pdf

U.S. Supreme Court Side-Steps Questions of Employee Privacy In Electronic Communications

2010-06-18T08:51:00.004-04:00

On June 18, 2010, the U.S. Supreme Court handed down its opinion in the case of City of Ontario v. Quon, a matter that has been closely watched by labor and employment lawyers across the country, who were expecting the first pronouncement or analysis by the High Court into the scope and boundaries of employee expectation of privacy in electronic communications in the workplace. Unfortunately, all those who were anxiously awaiting guidance in this age of rapidly advancing technology or the advent of new legal principles for the techno-age, will be disappointed. In a unanimous decision, the Supreme Court intentionally (and conspicuously) side-stepped all troubling and contentious issues swirling around privacy of electronic communications in the workplace, and instead chose to resolve this case on much narrower grounds, by simply holding that under the Court's existing precedents, the government employer in Quon did not violate the employee's Fourth Amendment rights when it audited his text message transcripts because the search that was conducted was reasonable and well within Constitutional limits.

Briefly, the Quon case involved a civil action filed by Quon, a member of the City of Ontario SWAT team, against the City of Ontario and various government officials, alleging violations of the Fourth Amendment to the U.S. Constitution (right to be free from unreasonable searches and seizures), and other claims based on federal and California law, after the City police department conducted an audit of two-months of Quon's text message transcripts in order to determine whether Quon was sending text messages about non-work related matters during working hours. Specifically, the City had issued text-messaging pagers to all of its SWAT team members in order to enable them to respond more quickly to emergencies. The pagers came with a text-messaging plan that allowed a maximum number of text characters to be sent each month. At the time that the pagers were issued, the City had in place an electronic communications policy, which stated that the City had the right to monitor all network activity, including email and Internet activity without notice, and that the users of the network had no expectation of privacy in any communications sent over the City's network. While the text messages that were sent via the SWAT pagers were transmitted by a third-party wireless carrier rather than over the City's network, the SWAT members were told on at least one occasion that the text messages would be treated by the City the same as emails, and thus, would be subject to the City's electronic communication policy.

A few months after the pagers were issued, Quon was approached by a supervisor, who told Quon that he had exceeded his monthly text message character allotment, and that an overage charge was being charged to the City. Quon's supervisor told Quon that if he simply paid for the overage charge, the supervisor would not conduct an audit of Quon's text messages to see whether the texts were work-related or not. Quon agreed and paid for the overage himself.

After many subsequent months of incurring overage charges, Quon's supervisor decided that he was "tired of being a bill collector," and ordered an assistant to retreive the text messaging transcripts for Quon and some other officers for purposes of auditing the content and usage of the text messages being sent during work hours. Two months of transcripts were received by the City, and it proceeded to redact all text messages sent by Quon outside his scheduled work shifts for those months, and instead, looked only at the content of those messages sent during work hours. The City discovered that during work hours in August of 2002, Quon had sent 456 text messages, only 57 of which were work-related. On an average workday, Quon would send or receive 28 messages, of which only about 3 were related to police business. Many were sexually explicit, as well. Quon was allegedly disciplined for violating internal police rules following this audit.

Quon then filed suit, claiming that the City's search of his text message transcripts constituted a violation of his Constitutional right to be free from unreasonable searches under the Fourth Amendment. Quon maintained that the City's electronic privacy policy had been abrogated by the City when his supervisor began a practice of not auditing Quon's text messaging on a monthly basis, so long as Quon paid for any related overage charges. Quon argued that this practice then created an expectation for him that the content of his text messages were private and protected. The 9th Circuit Court of Appeals, below, had agreed with Quon and held the search unconstitutional.

When the Supreme Court first agreed to hear this case, it was expected that the Court's ultimate decision would involve an analysis of the interplay between electronic communications in today's world, the privacy expectations that employees may have in sending or receiving such electronic communications versus an employer's expectation of an efficient work environment. Yet, the Supreme Court avoided all of these thorny issues, and simply held that, based upon the facts of this case, that the City's search was reasonable under the Fourth Amendment, and therefore permissible. In so doing, the Court explicitly assumed that: (1) Quon had a reasonable expectation of privacy in the text messages sent on the pager provided to him by the City; and (2) the principles applicable to a government employer's search of an employee's physical office apply with the same force to when the employer intrudes on an employee's privacy in the electronic sphere.

Other than these two assumptions (which were accepted by the Court solely for purposes of deciding this case), the Court explained its reasons for side-stepping any questions regarding the nature of electronic communications themselves as follows:

"The Court must proceed with care when considering the whole concept of privacy expectations in communications made on electronic equipment owned by a government employer. The judiciary risks error by elaborating too fully on the Fourth Amendment implications of emerging technology before its role in society has become clear. . . Prudence counsels caution before the facts in the instant case are used to establish far-reaching premises that define the existence, and extent, of privacy expectations enjoyed by employees when using employer-provided communication devices. . . Rapid changes in the dynamics of communication and information transmission are evident not just in the technology itself but in what society accepts as proper behavior. As one amici brief notes, many employers expect or at least tolerate personal use of such equipment by employees because it often increases worker efficiency. . . Another amicus points out that the law is beginning to respond to these developments, as some States have recently passed statutes requiring employers to notify employees when monitoring their electronic communications. . . At present, it is uncertain how workplace norms, and the law’s treatment of them, will evolve."

The Court continued its dance around these thorny issues by noting that: "the Court would have difficulty predicting how employees’ privacy expectations will be shaped by those changes or the degree to which society will be prepared to recognize those expectations as reasonable . . . Cell phone and text message communications are so pervasive that some persons may consider them to be essential means or necessary instruments for self-expression, even self identification. That might strengthen the case for an expectation of privacy. On the other hand, the ubiquity of those devices has made them generally affordable, so one could counter that employees who need cell phones or similar devices for personal matters can purchase and pay for their own. And employer policies concerning communications will of course shape the reasonable expectations of their employees, especially to the extent that such policies are clearly communicated. A broad holding concerning employees’ privacy expectations vis-à-vis employer-provided technological equipment might have implications for future cases that cannot be predicted. It is preferable to dispose of this case on narrower grounds."

Therefore, while many of us in the legal community were anxiously awaiting the Supreme Court's weighing-in on these emerging issues of electronic communications, employee privacy, and employer interests, it seems that we will have to wait a bit longer.

In the meantime, perhaps Congress should give iPhones to all of the Justices and their Clerks.

You can read the full Supreme Court opinion in Quon here: http://www.supremecourt.gov/opinions/09pdf/08-1332.pdf

U.S. Supreme Court: Employee May Challenge Employer's Use of Discriminatory Policy Even If Policy Itself Was Not Challenged When Adopted

2010-05-25T16:56:00.000-04:00

In Lewis v. City of Chicago, No.: 08-974 (May 24, 2010), the U.S. Supreme Court held that under Title VII, an employee may challenge an employer's use of an alleged discriminatory employment policy even if the employee failed to administratively challenge the alleged discriminatory policy at the time it was adopted by the employer.

Lewis involved a class-action lawsuit that was filed by 6,000 fire-fighters against the City of Chicago, alleging that the City's policy for hiring fire-fighters from a pool of candidates who took a written examination was discriminatory under Title VII, as it worked a disparate impact against African-Americans. Specifically, the City adopted a policy whereby all individuals who scored at least 89 out of 100 points on the written exam would be placed in one pool of candidates, while individuals who scored between 65 and 88 on the written exam would be placed into a second pool. As the City had the need to fill vacant fire-fighter positions, it randomly chose candidates from the 89-100 score pool first, until that pool was exhausted. The City admitted that this system, which it formally and publically adopted on January 26, 1996, was discriminatory.

However, while the City admitted that the policy was discriminatory, no claims of discrimination were ever filed against the City before the EEOC within 300 days of the City's adoption of the policy. However, on March 31, 1997, a charge of discrimination was filed before the EEOC by an individual who was a member of the 65-88 score candidate pool, alleging discrimination by the City through the use of the policy.

The City moved to dismiss the case, arguing that because none of the plaintiffs ever challenged the legality of the policy within 300 days of when the City publically adopted it, the plaintiffs' suit alleging discrimination as a consequence of that policy was thus time-barred. The City further claimed that while the policy was admittedly discriminatory when adopted in 1996, since no challenge to its validity was made within 300 days after its adoption, its legality could no longer be questioned.

The Supreme Court disagreed and held that the plaintiffs stated a valid cause of action. Justice Scalia, writing for a unanimous Court, held that the disparate impact prohibition contained within Title VII plainly bars the "use" of a particular employment practice that causes a disparate impact. Therefore, the plaintiffs here were able to challenge the legality of the City's actual implementation of the alleged discriminatory policy, not just its adoption. As it was undisputed by all the parties that the City had "used" the policy to hire fire-fighters exclusively from the 89-100 score candidate pool within 300 days of when plaintiffs filed their charge of discrimination, the Supreme Court held that dismissal of plaintiffs' case was improper.

A copy of the Supreme Court's full opinion can be found here: http://www.supremecourt.gov/opinions/09pdf/08-974.pdf

New FLSA Amendment in Health Care Reform Bills Requires "Reasonable Break Time" for Nursing Mothers

2010-04-13T13:44:00.001-04:00

Included within the two health care reform bills signed into law by President Obama on March 23 and March 30, 2010, was an amendment to the Fair Labor Standards Act, which requires employers to provide nursing mothers with "reasonable break time" to pump breast milk for up to one year after the birth of a child.

This new FLSA provision does not define what constitutes a "reasonable" break time, or what seperate penalties may be imposed for an employer's failure to provide such time. The amendment does provide for a exemption for employers with less than 50 employees, if the employer can show that the requirements would impose an "undue hardship."

It is expected that the Department of Labor will be promulgating regulations sometime in the future to guide employers in the application and interpretation of this requirement.

Third Circuit Holds That Difficulty Getting To Work Because of Disability May Require Accomodation Under ADA

2010-04-09T09:19:00.000-04:00

On April 8, 2010, the Third Circuit Court of Appeals in the case of Colwell v. Rite Aid Corporation, No.: 08-4675, held that under certain circumstances, an employer may be required under the Americans with Disabilities Act to accomodate an employee's disability-related difficulties in getting to and from work. Specifically, the Court determined that a shift-change, which is requested by a disabled employee in order to ease that employee's ability to commute, would be a type of accomodation required under the ADA.

In Colwell, the employee worked as a cashier for defendant, Rite Aid Corporation. As a matter of personal preference, her available shift hours were from 9:00 AM to 2:00 PM or 5:00 PM to 9:00 PM. Shortly after her hire date, the employee was diagnosed with a medical condition in her left eye that eventually caused her to go blind in that eye. Although the employee was still able to see out of her right and perform all of her duties at work, she informed her supervisor that her partial blindness made it dangerous and difficult to drive at night. Employee provided her supervisor with a note from her doctor, in which it was recommended that employee not drive at night. Employee then requested from her supervisor that she only be assigned day-shifts because she could not drive at night, and because public transportation was not an option for her, as the bus stopped running at 6:00 PM and no taxis were available. Employee's supervisor refused, telling employee that to assign her only day shifts would not be fair to other employees. Following that refusal, employee was forced to have her family members shuttle her to and from work for her night-shifts, which she claimed created a hardship for her family.

Employee filed suit, claiming that Rite Aid had failed to provide her with a reasonable accomodation under the ADA by failing to modify her work schedule. The trial court entered an order dismissing employee's accomodation claim, ruling that because employee did not require any accomodation to perform her job duties once at work, the accomodations employee sought had nothing to do with her work environment or the circumstances in which she performed her work. Thus, Rite Aid had no duty to accomodate employee's commute to and from work.

On appeal, the Third Circuit disagreed, and reversed the trial court's ruling on this issue. Specifically, the Court rejected the trial court's reasoning that "commuting to and from work falls outside the work environment," holding that "the reach of the ADA is not so limited." Rather, the Court noted that the ADA specifically defines the term "reasonable accomodation," to include "modified work schedules" - the exact type of accomodation requested by employee in this instance. Contrary to the trial court's determination, the Third Circuit held, as a matter of law, that "under certain circumstances the ADA can obligate an employer to accomodate an employee's disability-related difficulties in getting to work, if reasonable. One such circumstance is when the requested accomodation is a change to a workplace condition that is entirely within an employer's control and that would allow the employee to get to work and perform her job."

The Court cautioned, however that "our holding does not make employers responsible for how an employee gets to work," but noted that, in this instance, the employee was not asking for help in getting to or from work - rather, she was only requesting a shift-change that would ease her ability commute.

EEOC Cautions Against Use of Credit Checks To Screen Job Applicants

2010-04-07T11:56:00.000-04:00

In March, the Equal Employment Opportunity Commission released a legal opinion letter on its website cautioning that the use of credit checks by employers to screen job applicants could be unlawful under federal discrimination laws, if the use of credit checks results in a disproportionate exclusion of women or minority candidates for consideration of employment. The use of credit checks would only be permissible under those circumstances if the employer is able to demonstrate that the credit check process is needed for the employer to operate safely and efficiently. But, as the opinion letter also points out, at least one EEOC attorney has already testified that credit checks have not been shown to be a valid measure of job performance.

A link to the opinion letter can be found here: http://www.eeoc.gov/eeoc/foia/letters/2010/titlevii-employer-creditck.html

Lay Testimony May Supplement Medical Testimony in FMLA Cases

2010-03-11T17:19:00.000-05:00

In Schaar v. Lehigh Valley Health Services, Inc., the Third Circuit Court of Appeals held, in an FMLA suit concerning the denial or applicability of FMLA leave, that an employee may use his/her own lay testimony to supplement the medical testimony of a health care professional in order to allow a jury to ultimately determine whether the employee was suffering, or had suffered, from a "serious health condition," at the time the FMLA leave was requested or taken.

The Court of Appeals noted, however, that contrary to the rules in the Fifth and Ninth Circuits, in an FMLA case concerning a "serious health condition," lay testimony of the employee by itself is insufficient to allow the employee's claim to proceed to a jury.

At-Will Employee May Sue For Wrongful Termination When Fired In Retaliation For Complaining About Drug-Testing Violations

2010-03-08T10:59:00.000-05:00

The U.S. District Court for the Middle District of Pennsylvania has ruled that an at-will employee may sue his/her former employer for wrongful termination where the employee is terminated in retaliation for making complaints about his/her employer's or supervisor's failure to comply with Federal and State mandatory drug-testing requirements, where such requirements have been adopted for the protection of the safety of the public at large.

In Oliveri v. U.S. Food Service d/b/a North Star Foodservice, District Judge James M. Munley dismissed Defendant/employer's Motion to Dismiss plaintiff's complaint where plaintiff, at-will employee, alleged that his termination by employer was unlawful in violation of the public policy of Pennsylvania. Defendant/employer was a commercial trucking company, which was required by federal regulations to perform random drug-testing on its commercial truck drivers. Defendant had employed plaintiff as a manager of transportation, an "at-will" position. During the course of his employment, plaintiff discovered that his immediate supervisor was delaying or excusing testing on several drivers, all in violation of federal regulations. Plaintiff complained to other supervisors in the company, but to no avail. Finally, plaintiff contacted an anonymous hotline that Defendant/employer maintained to allow employees to make complaints, reciting his supervisor's violations of the federal drug-testing requirements. The next day, plaintiff's supervisor told plaintiff that he knew plaintiff had complained to the hotline and terminated his employment.

Plaintiff sued Defendant/employer, alleging that despite his status as an "at-will" employee, his termination was in violation of the public policy of Pennsylvania. The Court agreed, holding that Pennsylvania courts have recognized that highway safety and the regulation of commerical trucks are significant matters of public policy, and that Pennsylvania has specifically adopted by reference the federal drug-testing regulations for commerical truck drivers that plaintiff claimed were violated by his supervisor. Therefore, the Court allowed plaintiff's claim of wrongful termination to proceed.

Helicopter Pilots Entitled to Overtime Pay in Pennsylvania, New Jersey & Delaware

2010-03-08T09:49:00.000-05:00

Commerical helicopter pilots in Pennsylvania, New Jersey or Delaware, are now entitled to mandatory time-and-a-half overtime pay for all hours worked in excess of 40 during a single workweek.

In Pignataro v. Port Authority of New York and New Jersey, the Third Circuit Court of Appeals held that helicopter pilots did not qualify for the "learned professional" exemption under the federal Fair Labor Standards Act, because the skills and training necessary to obtain a helicopter pilot's certification and license did not require "advanced knowledge that is customarily acquired from a prolonged course of specialized instruction." Thus, helicopter pilots who work more than 40 hours a weeks are entitled to mandatory overtime pay.

In reaching this conclusion, the Court of Appeals noted that jobs that traditionally fall within the "learned professional" exemption are those that require academic degrees from a college or university. Helicopter pilots, however, are not required to have academic degrees or spend a significant amount of time in the classroom. Rather, the majority of pilots' instruction takes place in the air, logging in-flight hours and undergoing in-flight instruction. And, the Court noted that a helicopter pilot's passing of practical and written tests do not qualify as the type of "prolonged court of specialized intellecutal instruction and study," that is required under the federal regulations in order for an employee to qualify for the "learned professional" exemption.

Court Allows Gender Hostile Work Environment Claims To Proceed To Jury

2009-12-02T10:20:00.000-05:00

In Hiltabidel v. Uniontown Newspapers, Inc., No.: 2:08-cv-409 (W.D. Pa. 2009), the Court allowed plaintiff's allegations of a hostile work environment based upon her gender to proceed to a jury. The Court held that genuine issues of material fact existed with respect to whether comments made regarding plaintiff's attractiveness made by her supervisor, along with what plaintiff categorized as inappropriate requests and placement in inappropriate situations by her supervisor were severe and pervasive enough to constitute a hostile work environment under Title VII.

Plaintiff was a female sales representative for the defendant and had the responsibilities of selling advertising on the defendant's internet websites. The following facts were undisputed: (1) in March of 2007, plaintiff accompanied her supervisor to a meeting with a male potential client at the bar of a restaurant in Uniontown and that during the meeting, the customer sat next to plaintiff, his leg made contact with her leg early in the meeting and his arm was draped around plaintiff's chair for the duration of the meeting; (2) after the March, 2007 meeting, plaintiff requested not to meet with potential customers in restaurants again; (3) in April, 2007, plaintiff's supervisor asked her to have dinner with an employee of a Philadelphia newspaper that was conducting an on-site visit with the defendant; (4) on more than one occasion, plaintiff's supervisor shared comments with her that he either received or overheard the opinion that plaintiff was an attractive woman; (5) on one occasion, plaintiff's supervisor asked her to accompany him on an overnight business trip, which she declined;(6) on April 23, 2007, plaintiff approached the manager of a different department of the defendant employer and expressed her opinion that conducting a meeting with a customer in a bar was inappropriate; and (7) plaintiff resigned her position in June, 2007.

The defendant employer did not dispute these incidents, but argued that the supervisor never directed sexual conduct or behavior towards plaintiff, that the bodily contact complained of at the March, 2007 meeting was incidental, and that the remainder of plaintiff's complaints were innocuous incidents that were insufficient to give rise to a claim of a hostile work environment.

Plaintiff also complained of defendant's requirement that plaintiff be accompanied on appointments with potential clients by a sales representative from a different department. Defendant argued that this was intended to assist plaintiff and relieve her of having to "cold-call" potential clients. Plaintiff argued that this requirement was made in response to her complaints and was intended to reduce of efficacy of her position.

Court Rejects Hostile Work Environment Claim Based On Racial Comments and A Text Message

2009-12-02T09:47:00.000-05:00

On November 23, 2009, in the case of Griffin v. Harrisburg Property Services, Inc., No.: 1:CV-08-1655 (M.D. Pa. 2009), District Judge Sylvia H. Rambo dismissed plaintiff's claim of a hostile work environment that was brought after plaintiff, a male African-American security employee, was subjected to two racially charged comments by his supervisor, a caucasian male, and also received racially explicit text message from that same supervisor. Shortly after receiving the text message, plaintiff reported the incidents to a different supervisor, who conducted an investigation, granted plaintiff's request for a location transfer, placed a final warning in the commenting supervisor's employment file, and conducted an in-house diversity training session.

The Court held the the evidence of two racial comments and one racially explicit text message was sufficient to establish a claim for intentional harassment based on race that was severe or pervasive, and which had a detrimental effect on the plaintiff. But, despite this finding, the Court dismissed plaintiff's claim because: (1) there was no evidence that the supervisor had relied upon his employment authority or that the company had aided him in any way while making his derogatory comments; and (2) in conducting its investigation, placing a final warning in the supervisor's file, granting plaintiff's transfer request, and conducting an in-house diversity session, the employer had taken appropriate remedial actions that were reasonably calculated to remedy the harassment. The Court held that these facts were sufficient to insulate plaintiff's employer from liability of the supervisor's actions under Title VII.

GINA Arrives!

2009-12-02T08:40:00.000-05:00

The "Genetic Information Nondiscrimination Act of 2008" (GINA) went into effect last week, on November 21, 2009. GINA covers all private, state and local government employers who employ fifteen (15) or more employees, and prohibits such employers from: (1) taking any adverse employment action against an employee or prospective employee because of genetic information; or (2) limiting, segregating, or classifying employees in any way because of genetic information, which would deprive or tend to deprive the employee of employment benefits or which would adversely affect the employee's work status. With some limited exceptions (such as for use in an employer-offered health or wellness program), GINA also prohibits covered employers from requesting, requiring or purchasing genetic information about their employees or the family members of employees.

"Genetic information" under GINA is defined relatively broadly, and refers to information about an employee's genetic tests, genetic tests of an employee's family members, or the manifestation of a disease or disorder in family members of an employee. Note also, that the term "family member" of an employee is defined under GINA as "any individual who is a first-degree, second-degree, third-degree or fourth-degree relative" of an employee, i.e., an employee's parent, grandparent, great-grandparent, and great-great-grandparent.

For violations of GINA by an employer, the statute provides for various damages and remedies such as compensatory damages for future monetary losses, emotional distress, pain, suffering, inconvenience, mental anguish, punitive damages, attorneys' fees and expert witness fees. GINA does not allow for the recovery of backpay or interest on backpay.

The provisions of GINA are enforced by the EEOC. For more information on GINA's requirements and prohibitions, visit the EEOC website at http://www.eeoc.gov/laws/types/genetic.cfm

Court Refuses To Dismiss Claim of Pregnancy Discrimination

2009-11-06T08:00:00.000-05:00

In Armstrong v. Greenwood Gaming and Entertainment, Inc., No.: 09-1321 (E.D. Pa. 10/21/2009), Senior Judge Louis H. Pollak, denied Defendant, Greenwood Gaming and Entertainment, Inc.'s motion to dismiss Plaintiff's allegations of pregnancy discrimination.

Plaintiff, a thirty-seven year old female, sued her employer, alleging that while she was pregnant, a manager at her workplace told plaintiff that if she lost her baby due to heavy lifting, she could "spread her legs and pop out another one," and also told Plaintiff that if she became pregnant again, he would punch her in the stomach. Plaintiff also claimed that she was denied a pay-raise that was given to non-pregnant employees.

Plaintiff went on maternity leave from October 2007 to January, 2007, but was terminated from her employment on February 1, 2008, for an alleged violation of workplace rules. Plaintiff contended that the stated reasons for her termination were pretextual, as certain male employees had committed similar violations in the past, but had suffered no adverse consequences.

The District Court refused to dismiss Plaintiff's complaint, holding that the above allegations were sufficient to allow Plaintiff's case to proceed through discovery. The Court also refused to dismiss Plaintiff's claim for punitive damages, holding that on these facts a jury "might infer the requisite nefarious attitude from defendant's action in discharging plaintiff right after her maternity leave."

RICCI v. DeSTEFANO: A TROUBLESOME BURDEN FOR EMPLOYERS

2009-11-03T10:47:00.000-05:00

On June 29, 2009, the United States Supreme Court, in a 5-4 ruling, decided the much-anticipated discrimination case of Ricci v. DeStefano, 129 S.Ct. 2658 (2009) and held that Title VII prohibits an employer from engaging in intentional discriminatory practices for the purpose of avoiding or remedying an unintentional disparate impact, unless the employer has 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,” being complained of. In other words, an employer whose decision or policy unintentionally causes a disparate impact under Title VII, may not engage in any “curative” discriminatory practices in order to obviate the impact unless the employer can produce strong evidence that it will be subject to a disparate impact claim if it does nothing. Even though the Court’s decision holds firm to the unambiguous statutory mandates of Title VII, and thus is analytically sound, the practical effect that this ruling may have on employers going forward may be less than logical and indeed, may be downright burdensome.

The dispute in Ricci centered on a promotional examination for firefighters that was administered by the City of New Haven, Connecticut. In 2003, New Haven found itself with seventeen vacant officer positions within the City’s fire department. To fill these vacancies, New Haven administered a comprehensive promotional examination, consisting of both a written and an oral test. Ultimately, the examinations were taken by 118 firefighters with requisite service credentials. Of these 118 applicants, sixty-eight candidates were white, twenty-seven were black, and twenty-three were Hispanic. Fifty-six examinees passed the tests – forty-one whites, nine blacks and six Hispanics. The City’s civil service rules required the City to fill each vacancy by choosing one candidate from the top three scorers on the list of passing examinees, which meant that the eight available lieutenant positions would be filled entirely by white applicants, and that seven white candidates and two Hispanic candidates would be eligible for promotion to the seven vacant captain positions.

After seeing the statistical disparity in the results of the promotional examinations, some officials of the City of New Haven, including the City’s attorney, began to express their concerns that the tests had discriminated against minority candidates and urged the City to reject the results, claiming that the test results reflected a “statistical demonstration of a disparate impact,” which would subject the City to a discrimination claim under Title VII, if not rejected. Many of the firefighters who took the exam, however, argued that the results were fair and should be allowed to stand. Ultimately, the examination results were not accepted.

The firefighters thereafter sued the City under Title VII, claiming that when the City rejected the test results in order to alleviate a perceived disparate impact on the minority candidates, the plaintiffs themselves had suffered an adverse employment decision due to their race - an action clearly in violation of Title VII. In response, the City argued that “they cannot be held liable under Title VII’s disparate-treatment provision for attempting to comply with Title VII’s disparate impact bar.” Ricci at 19.

Writing for the majority of the Court, Justice Kennedy recognized that “[t]he City’s actions would violate the disparate-treatment prohibition of Title VII absent some valid defense,” and that notwithstanding “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.” Ricci, at 19-20. Having recognized that the City’s decision to reject the test results was, in and of itself, a patent violation of Title VII, the Court noted that “the question is not whether that conduct was discriminatory but whether the City had a lawful justification for its race-based action.” Id.

To answer this question, the majority turned to the Court’s Fourteenth Amendment Equal Protection jurisprudence and adopted a “strong basis in evidence” standard to govern these types of employer decisions. Under this test, “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 a disparate-impact liability if it fails to take the race-conscious, discriminatory action.” Id. at 26. Importantly, this test is an objective one, and will not necessarily be resolved in favor of the employer, even when the employer maintained a subjective motivation or belief that it was taking action in order to avoid committing disparate-impact liability. Id. In short, the majority found that on the record before it, the City of New Haven was unable, as a matter of law, to establish “an objective, strong basis in evidence to find the tests inadequate, with some consequent disparate-impact liability in violation of Title VII.”

In practice, the new “strong basis in evidence” defense that was enunciated by the Court’s majority places the burden on the employer to essentially prove, almost as if it were the plaintiff, that the policy or decision sought to be remedied or avoided actually resulted in an impermissible disparate impact in violation of Title VII. While the burden of proof on an employer seeking the protection of this defense was not precisely described by the majority in such terms, it was made quite clear that more than a mere showing of a disparate impact is required. Specifically, the majority opinion stated that “a prima facie case of disparate-impact liability – essentially a threshold showing of a significant statistical disparity . . . and nothing more – is far from a strong basis in evidence that the City would have been liable under Title VII . . .” Id. at 28. And, the majority was unequivocal in noting that “fear of litigation alone cannot justify an employer’s reliance on race to the detriment of individuals . . .” Id. at 33.

The consequences of an employer’s reliance on this defense should be obvious. In order to avoid liability for a racially motivated, albeit subjectively well-intentioned employment decision, undertaken to cure a different perceived discriminatory action, an employer is now forced to establish and produce sufficient evidence of its own liability for a disparate-impact violation under Title VII. For an employee, who is a member of the “disparate-impact” class, nothing could be more desirable than having the employer produce and argue evidence of its own Title VII disparate-impact transgression. Moreover, the employer who is actually successful in establishing a “strong basis in evidence” defense and avoiding a disparate treatment claim, has now almost assuredly left itself wide-open for liability on the disparate-impact claim. On the other hand, in those situations where the employer is unable to meet the evidentiary threshold of the “strong basis in evidence” defense, liability for the employer’s disparate-treatment decision is almost assured. And, consider what would happen if the employer finds itself litigating both a disparate-treatment and a disparate-impact suit at the same time – how does the employer go about mounting a credible defense to one without jettisoning its ability to prevail in the other?

Despite the legal and statutory foundation for the Court majority’s ruling, it appears that in practice, the Ricci test that is now applicable in such discrimination lawsuits under Title VII, may work more of a zero-sum game for employers than was perhaps intended or desired, with liability almost certainly resulting from one position or another. Therefore, an employer who attempts to remedy or alleviate a previous employment practice or decision it believes, in good-faith, may work a disparate-impact (even through such a practice or decision may have been made without any malice or discriminatory intent whatsoever), will find itself forced into a “damned-if-you-do, damned-if-you-don’t,” situation as a consequence of the framework set forth by the Ricci case. Therefore, both employers and their counsel must be cognizant of such a situation, including the consequences thereof. After all, in the landscape of discrimination claims following the Ricci decision, preparation may well be the only real defense an employer can muster.

3rd Circuit - Independent Contractors May Bring Discrimination Claims under 42 U.S.C. Section 1981

2009-11-03T10:25:00.000-05:00

On September 11, 2009, the Third Circuit Court of Appeals held, for the first time in this jurisdiction, that an independent contractor may properly bring an action for discrimination against the entity with which he or she contracted, pursuant to 42 U.S.C. section 1981.

42 U.S.C. section 1981 provides that "All persons within the jurisdiction of the United States shall have the same right in every State and Territory to make and enforce contracts, to sue, be parties, give evidence, and to the full and equal benefit of all laws and proceedings for the security of persons and property as is enjoyed by white citizens, and shall be subject to like punishment, pains, penalties, taxes, licenses, and exactions of every kind, and to no other."

Independent contractors have historically been unable to seek and enjoy the protections of employment discrimination laws such as Title VII and the Pennsylvania Human Relations Act, because the scope and application of these laws is strictly limited to those individuals who are "employees." With this decision, however, independent contractors within the jurisdiction of the Third Circuit are able to enjoy a modicum of protection and bring a cause of action on the basis of discrimination that occurs within the context of the independent contractor relationship.

3rd Circuit - Accrued "Comp" Time" Counts Towards FMLA Leave

2009-11-03T09:22:00.000-05:00

On September 23, 2009, the Third Circuit Court of Appeals in Erdman v. Nationwide Ins. Co., held that "comp" time (or "compensatory" time) that is accrued by an employee for overtime hours worked, may be included towards the 1,250 minimum hours of service needed to be eligible for Family Medical Leave, where enough evidence exists to show that the employer had either actual or constructive knowledge that the employee was accruing "comp" time hours.

In this case, the plaintiff, Brenda Erdman, sued her former employer, Nationwide Insurance Company, alleging that she was terminated from her position in 2003 in retaliation for requesting FMLA leave in order to care for her daughter, who has Down Syndrome. Nationwide argued that Erdman was fired for unrelated behavioral problems, such as allegedly using profanity on a phone call that was being monitored for quality control.

Before the trial court, Nationwide moved to dismiss Erdman's FMLA claim, alleging that she had not accrued the requisite 1,250 hours of service over the previous 12 month period necessary to become eligible for FMLA leave in the first place. Erdman calculated that she had accrued 1,298.25 hours within the relevant time period, which included "comp" time hours that she accrued from extra work performed at home in 2002. Nationwide disputed the inclusion of Erdman's "comp" time hours, arguing that in 2002, it had no knowledge, either actual or constructive, that Erdman had been working extra hours and accruing "comp" time, and that in February, 2003, Erdman's supervisor specifically told Erdman that she could no longer use extra hours for "comp" time. Nationwide also pointed to a conversation between Erdman and her former supervisor, wherein Erdman was told to "put in the hours that you're supposed to put in and nothing more than that." The trial court agreed with Nationwide and excluded Erdman's "comp" time from the FMLA hours calculation.

On appeal, the Third Circuit disagreed, and vacated the dismissal of Erdman's FMLA claim. The Court of Appeals held that on the evidence presented, a reasonable jury could conclude that Nationwide did, in fact, possess actual or constructive knowledge that Erdman was accruing "comp" time in 2002. The Court held that the conversation relied upon by Nationwide in which Erdman was told to only "put in the hours that you're supposed to put in," was not supportive of Nationwide's position, as it made no specific reference to "comp" time accrual. The Court also pointed to an email that was sent by Erdman to her supervisor during the relevant period, in which Erdman sought to clarify whether she was still authorized to work extra hours for "comp" time, but to which she received no reply. On this evidence, the Court of Appeals concluded that Erdman's FMLA claim should should have been sent to a jury, to determine whether Nationwide intended to prohibit all out-of-the-office work, or whether Nationwide had only intended to preclude Erdman from earning overtime, while still allowing her to accrue "comp" time.

Welcome to PA Employment Law Blog!

2009-11-02T10:04:00.000-05:00

Welcome all!

This is a blog that will discuss new developments in employment law in Pennsylvania. As a lawyer in the suburban Philadelphia area, my goal is to not only provide updates on recent case law and legislation in this area for those in the legal profession, but also to provide practical advice and information for both employers and employees alike. I will do my best to update this blog as frequently as possible, so visit often!

If anyone has any specific questions about anything posted on this blog, feel free to email me at mdavey@eckellsparks.com or call me at (610) 565-3700.

Also, make sure to visit our firm's website at www.eckellsparks.com for all of your legal needs in and around the Philadelphia area!

Enjoy!

~Michael J. Davey, Esq.
Eckell, Sparks, Levy, Auerbach, Monte,
Sloane, Matthews & Auslander, P.C.
344 West Front Street
Media, PA 19063
(610) 565-3700
mdavey@eckellsparks.com
www.eckellsparks.com