© 2011 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Recent Developments in Employment Law Joint Triad HR Leadership Conference May 17, 2011 Presented

© 2011 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED.

Recent Developments in Employment LawJoint Triad HR Leadership Conference

May 17, 2011

Presented by:Alexander L. Maultsby

Smith Moore Leatherwood LLP300 North Greene Street, Suite 1400

T: (336) 378-5331F: (336) 433-7460


Hot Topics 2011

• Legislative / Regulatory

– ADA Amendments

– Genetic Information Nondiscrimination Act

– DOL Enforcement


Hot Topics 2011

• Courts / Litigation

– Retaliation Claims

– Class Actions

– Discrimination


Cold Topics

• Not Developing . . .

– Immigration Reform

– Free Choice Act

– Employee Nondiscrimination Act (sexual orientation)


Disabilities

• The Americans with Disabilities Amendments Act of 2008

– Signed by President Bush on September 1, 2008

– Effective January 1, 2009

– Regulations issued March 25, 2011


Meaning of “Disability”

• Physical or mental impairment that substantially limits a major life activity

• Record of such impairment

• Regarded as having such impairment


Disabilities

• “Major Life Activity”

– Statutory List = the “ings”• “working”

– Major Bodily Functions• e.g., immune system, cell growth, neurological,

endocrine, reproductive, respiratory, digestive, circulatory, etc.


Disabilities

• “Substantially Limits” – no longer means “severe” or “significantly restricted”

• Do not consider Mitigating Measure (other than eyeglasses or contact lenses)

• Conditions that are Episodic or in Remission

• “Disability” = Interpret Broadly


EEOC Estimates

Impact of Amendments:

• 1 million more workers covered and protected

• 12-38 million disabled workers have had their coverage clarified

• 2-6 million more requests for reasonable accommodations

• $60-$180 million cost of new accommodations


Genetic Information

• Genetic Information Nondiscrimination Act

– Signed by President Bush on May 21, 2008

– Regulations issued on November 9, 2010


Genetic Information

• Employers of 15 or more

• Prohibits employers from requesting, requiring or purchasing genetic information

• Enforced by EEOC


Genetic Information - What Is It?

• Family medical history

• Results of any genetic test of employee or family member

• Fact that such person sought or received genetic services

• Genetic information about fetus carried by such person


Genetic Tests

• “Analysis of human DNA, RNA, chromosomes, proteins, or metabolites that detects genotypes, mutations, or chromosomal changes”

– Tests for genetic variant for:• Huntington’s• Breast Cancer• Sickle Cell Anemia• Spinal Muscular Atrophy• Fragile X Syndrome


Not Genetic Tests

• Tests for

– HIV / AIDS– Pregnancy– Alcohol / Drug– Cholesterol


Not Genetic Information

• Medical information on current illness (e.g., ability to work limited by Huntington’s)

• ADA and FMLA discussions are “present”


Employment Physicals


Exceptions . . .

. . . to the Rule Against Acquiring Genetic Information

• Inadvertent (water cooler; doctor’s note)

• FMLA certification for family member

• Wellness programs


Safe Harbor for Inadvertent Disclosures

The Genetic Information Nondiscrimination Act of 2008 (GINA) prohibits employers and other entities covered by GINA Title II from requesting or requiring genetic information of an individual or family member of the individual, except as specifically allowed by this law. To comply with this law, we are asking that you not provide any genetic information when responding to this request for medical information. "Genetic information," as defined by GINA, includes an individual's family medical history, the results of an individual's or family member's genetic tests, the fact that an individual or an individual's family member sought or received genetic services, and genetic information of a fetus carried by an individual or an individual's family member or an embryo lawfully held by an individual or family member receiving assistive reproductive services.


Wellness Programs

• May involve use of genetic information

• Must have prior, voluntary, knowing and written authorization

• Genetic information may be provided by employee to healthcare provider (and vice-versa)

• Only aggregated information may be provided to the employer


Health Benefits

• Cannot use genetic information to make decisions as to whether individual can participate

• Health benefits are a term or condition of employment

• Cannot refuse to hire or terminate due to anticipated health costs

• Title 1 limits use of genetic information in setting premiums and providing coverage


GINA = Confidentiality

• Safeguard Genetic Information

• It is illegal to disclose genetic information to third parties

– Segregate it

– Require a specifically worded court order

– A subpoena for “personnel file” or “all employment files” is insufficient


Remedies

• Same as Title VII

• Hiring, reinstatement, promotion

• Back pay, compensatory / punitive damages

• Damage caps $ 50,000 (under 100 employees)

$300,000 (over 500 employees)

plus attorney’s fees


DEPARTMENT OF LABOR

INITIATIVES


2011 Focus

• Independent Contractors

• Wage Payment


Independent Contractors

The DOL says:

• 3.4 million workers misclassified

• $3.72 billion in lost tax revenue

• 60% of all businesses use independent contractors

• Fits with goals of healthcare reform


Independent Contractors

Where it matters:

• Wage payment

• Workers’ Compensation and Health Insurance

• Payroll Taxes

• Employment Laws– 42 U.S.C. § 1981

• Union Organizing and Collective Bargaining


Leased Employees v. Independent Contractors

• With Leased Employees

– Employment Exists

– Someone Handles Compensation, Benefits, Taxes

– Joint Employer Issues


Employees v. Independent Contractors

The Controlling Factor is . . .



The Controlling Factor is . . .

Control



• IRS Divides “Control” into 3 categories:

– Behavioral Control – Who Instructs? Who Trains?

– Financial Control – Compensation? Expenses?

– Relationship of the parties – Contract? How does it end?



• Relationship of Parties –

Facts to Consider:

– What does the Contract say?– Tax treatment / Benefits treatment– How is the Worker discharged?– Is the relationship Indefinite?– Is the work “regular business activity?”



• Other Factors:

– Work is part-time

– Work is not “on-site”

– Hours are flexible


Courts and Litigation in 2011

• Class Actions

• Retaliation

• Discrimination


Class Actions

• Purposes

– Efficiency / Lower Costs

– Remove disincentives of small individual recoveries

– Prevent unfair benefit for early filers

– Synthesize outcomes


Class Actions

• Requirements:

– Common questions of law or fact “predominate” over individual issues

– Claims of representatives are typical of claims of the class

– Very big class (impractical for all to participate)


Class Actions

• Most Common Claims:

– Discrimination

– Misclassification

– Wage and Hour


Class Actions

• Dukes v. Wal-Mart

– Favoring men over women in promotion and wage decisions

– 1.5 million women at 3400 stores since 1998 at any level

– Will it be “certified” by the U.S. Supreme Court


Class Actions

• Wage and Hour Claims

– 80% of all class actions by employees

– Major plaintiffs’ firms are on the prowl


Wage and Hour – Critical Areas

• Exempt v. Non-Exempt

• Automatic deductions (breaks, meals)

• Telecommunications / Remote Work

• Early and late “punching”

• “Corrections” by supervisors


Wage and Hour

• Hefty Exposure

– 3 year look-back

– Multiplication for number of employees affected


Wage and Hour

There’s an app for that??


Retaliation

• Retaliation claims have surpassed race claims as the most frequently filed EEOC charge.

Retaliation Race

36.3% 35.9%

and growing and flat


The Problem with Retaliation Claims

• Difficult for employers to defend

• Most adverse decisions will look retaliatory

• Claims stand on their own

• More likely to survive pretrial motion and result in trial


Anti-Retaliation Laws

• Title VII of the Civil Rights Act of 1964

• Age Discrimination Employment Act

• Equal Pay Act

• Americans with Disabilities Act

• Family and Medical Leave Act

• Fair Labor Standards Act


Elements of a Claim

• Protected activity

• Adverse action

• Causal connection between protected activity and adverse action


Protected Activity: Opposition

• EE explicitly or implicitly communicates a belief that ER’s activity was unlawful discrimination

– Based on reasonable and good faith belief

– Manor of opposition must be reasonable


Protected Activity: Opposition

• Examples– Threatening to file a charge or other formal complaint

alleging discrimination

– Complaining to anyone about alleged discrimination against oneself or others

– Refusing to obey an order because of a reasonable belief that it is discriminatory

– Requesting reasonable or religious accommodations


Protected Activity: Participation

• Filing a charge, testifying, assisting with or participating in any manner in the statutory process (e.g., investigations, proceedings, hearing, lawsuits)

– Protected whether or not underlying discrimination charge is valid or reasonable


Adverse Action: The Law Today . . .

• Burlington Northern & Santa Fe Railway Co. v. White – U.S. S.Ct. 2006

– Prohibits any employer action that

well might dissuade a reasonable

worker from making or supporting a charge of discrimination.”

“[U]nlike a substantive provision” of Title VII, prohibited actions need not “affect terms and conditions of employment.”


Who May Claim Retaliation?

• Thompson v. North American Stainless, January 24, 2011 (Scalia)

• Unlawful to retaliate against someone “because he has made a charge.” (Title VII)

• But, “a person claiming to be aggrieved . . . by the unlawful employment practice” may sue.

• Thus, anyone “aggrieved,” not simply the person who complained.


Thompson: “Me and My Fiancé”

• The Court concluded:

– You might not engage in protected conduct if you think it means your fiancé will be fired.


Where Does It End

• Family Members – “almost always”

• Mere Acquaintance – “almost never”

• Supreme Court: “We decline to identify a fixed class of relationships for which third-party reprisals are unlawful.”


Preventing Retaliation: The Best Defense is a Good Offense

• Policies Specifically Prohibit Retaliation

(not just the EEO policy)

– Establish procedures for reporting

– Publicize / Post / Train

– Emphasize zero tolerance



• Appropriately Respond to Complaints

– Immediately investigate the underlying complaint

– Maintain confidentiality for underlying complaint (to the extent practicable)

– Focus on fixing the problem (“effective remedial action”)

– Document



• Close the Loop

– Record Reminder: No Retaliation

– Check In• Proactively monitor for 6 months• Coach Supervisor



• Train Supervisors to Maintain Incident File

– Record of good and bad incidents

– Complete while details fresh

– Review with Employee without waiting for formal appraisal


Subsequent Discipline

• Make good paper• Clear expectations• Reference patterns of behavior• Reference prior warnings, notices• Include any positives• Do not reference protected activity• Future consequences


Subsequent Discipline

Follow Policy to the Letter


Discrimination

• Same as it ever was

• Cat’s Paw Theory– Staub v. Proctor Hospital


Courts Expect Employers To . . .

• Avoid effects of biased supervisors

• Separate when possible

• Rely on objective, second sources

Documents

© 2011 Smith Moore Leatherwood LLP. ALL RIGHTS RESERVED. Recent Developments in Employment Law Joint Triad HR Leadership Conference May 17, 2011 Presented