Employment Law
Thank you for visiting our Employment
section. Below you will find articles and other information
in reference the the field of Employment and Labor Law. We have
listed the titles to articles we feel would be of interest to
employers. You will find the corresponding articles under the
list of titles.
Family Medical Leave Act Record-Keeping Requirements.
Focus on Sexual Harassment
Workers' Compensation: Are Your Workers
Classified Properly?
Binding Arbitration of Employment Disputes
Hostile Work Environment Not Limited to
Sex
Microsoft Decision Shows Risk of Using
Independent Contractors
Avoiding Workplace Violence
Employee Handbooks: A Tool To Use In Avoiding
Employment Litigation
FMLA
RECORD-KEEPING REQUIREMENTS
A jury in Virginia recently awarded
$313,000 pursuant to the Family and Medical Leave Act (FMLA)
to a worker who was fired after he took leave to have surgery
for a brain tumor. This verdict constitutes the largest award
yet under the Act.
The
size of this verdict should prompt every employer to evaluate
their compliance with the provisions of the Act. The greatest
pitfall for employers is the requirement that employers designate
absences covered under the Act as FMLA leave and to notify employees
in writing of the designation. In the event the employer fails
to designate FMLA leave properly or fails to notify the employee
of the designation, the employer cannot count that leave time
against the employee's 12-week entitlement. That means that
an employer who believes that it has lawfully terminated an
employee who has taken more than 12 weeks of leave, may be instead
liable for backpay and frontpay to the discharged employee.
Under
regulations promulgated by the Department of Labor interpreting
the FMLA, an employer must inform an employee within two business
days after an employee requests leave covered by the FMLA as
to whether the leave will be counted against the employee's
12-week entitlement. The burden is on the employer to determine
whether the FMLA applies even if the worker does not ask for
"FMLA leave." In other words, the employer is required
to determine whether or not each and every absence is covered
by the FMLA. It is only necessary for the employee to provide
enough information to put the employer on notice that the leave
may be for an FMLA-qualified reason. It is thus essential that
employees who maintain attendance records be trained to identify
which absences would be covered under the FMLA and to obtain
additional information from employees where it is not clear
that the absence is covered under the FMLA. For example, it
may be necessary to ascertain whether the employee is under
the care of a doctor or has stayed overnight in the hospital.
The employer may initially make
the designation orally, but it must be confirmed in writing.
The Department of Labor has promulgated a form called the Employer
Response to Employee Request for Leave which can be used by
employers to designate absences as FMLA leave.
The Family and Medical Leave Act
requires employers with fifty or more employees to provide workers
with up to 12 weeks of leave per year because of the birth or
adoption of a child; to care for a parent, spouse or child with
a serious health condition; or if an employee is unable to work
due to serious health condition. A serious health condition
is one in which initially the employee is ill for at least three
calendar days under the care of a physician or requires an overnight
stay in a hospital. Subsequent absences due to a serious health
condition can be a single day or even a portion of a day and
still be covered under the FMLA. An employer has the right to
demand medical certification from its employees to verify the
existence of a serious health condition. Again, the Department
of Labor has provided a form called the Certification of Physician
Form which can be used by employers to obtain verification.
Companies with "no-fault "
attendance policies must take particular care to ascertain whether
absences are covered under the FMLA before counting them against
employees pursuant to these policies. Company attendance records
should clearly indicate which absences are covered under the
FMLA and which are not.
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Focus
on Sexual Harassment
A recent jury verdict imposing
over $7,000,000 in punitive damages upon one of the nation's
largest law firms in a sexual harassment case focused attention
on the need for companies to protect themselves from this kind
of exposure. According to a survey, the number of companies
reporting one or more sexual harassment incidents among their
employees increased from 35 percent in 1991 to 65 percent in
1993.
It has been our experience that
the implementation of a clear and specific policy prohibiting
such harassment, the adoption of procedures for handling such
complaints, and the adoption of a training program for supervisors
can be effective in preventing sexual harassment lawsuits from
being filed. It is significant that in the aforementioned case,
the actual damages were slight but the jury awarded the punitive
damages because of the law firm's failure to respond to previous
complaints about the offending partner.
Employers cannot assume that it
will not happen to them. The defense of "only joking around"
has not found favor with investigators of these complaints.
Under the 1991 Civil Rights Law, jury trials are now available
on Title VII claims of sexual harassment and compensatory and
punitive damages may be awarded in addition to lost wages and
benefits. If we can assist in helping your firm develop sexual
harassment policies and procedures, please feel free to call
upon us.
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Workers'
Compensation: Are Your Workers Classified Properly?
Workers' compensation rates are
determined by classifying employees and charging rates that
are dependent on the comparative risks inherent in the job classifications.
Thus, a company pays higher premiums for a construction worker
or a window washer than it would for an accountant or secretary.
However, not all such distinctions are so clear cut. A recent
case involved the contention of a State Insurance Fund
that employees who were classified as receptionists were actually
security guards. Needless to say, there was a great disparity
between the rates for the two classifications. There are
cases of audits conducted by State Insurance Funds and other
workers' compensation insurance carriers who have sought what
they claimed to be substantial underpayments arising from misclassifying
employees to less risky job classifications. In a few situations,
the employer discovered that it was due money because its employees
had been misclassified.
We recommend that employers conduct
their own self-audit to determine if their employees are classified
properly prior to the conduct of any audit by their State Insurance
Fund or other insurance carrier. We can assist your company
in conducting such a self-audit.
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Binding
Arbitration of Employment Disputes
As a result of the United States
Supreme Court decision in Gilmer v. Interstate/Johnson Lane
Corp., more employers are including in their employment agreements
with employees provisions mandating compulsory arbitration of
age, sex, race, religious, national origin, and disability bias
claims.
In Gilmer, the Supreme Court held
that an employee was required to arbitrate his claim of age
discrimination pursuant to an employment agreement which specifically
included in its arbitration clause statutory claims of age discrimination.
For such an agreement to be enforced,
it is necessary for the clause to be carefully written to include
as many potential claims as possible.
Employers prefer arbitration of
employment discrimination claims because of the reduced legal
fees involved in defending such claims in arbitration as opposed
to court. Moreover, arbitration eliminates the threat of excessive
jury verdicts.
To date, Gilmer has not yet been
applied to a collective bargaining agreement. However, it is
likely that if an arbitration clause in a collective bargaining
agreement were to expressly provide for arbitration of such
employment discrimination, deferral to arbitration would be
required.
If you are interested in implementing
a program mandating binding arbitration of employment disputes,
please do not hesitate to contact us.
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HOSTILE
WORK ENVIRONMENT NOT LIMITED TO SEX
Most companies are aware of the
fact that sexual harassment can take one of two forms: quid
pro quo in which advancement or continuation in the company
is contingent on sexual favors; and hostile environment which
can result from abusive comments, offensive jokes, or visible
pornography. A recent decision by the United States Court of
Appeals for the Sixth Circuit highlights the fact that a hostile
work environment that violates the law does not have to be based
on sex. In this case, the court held that a hostile environment
age discrimination case can be brought under the Age Discrimination
in Employment Act. To establish such a claim, the employee must
show that the harassment was based on age and that it unreasonably
interfered with work performance and created an objectively
intimidating, hostile, or offensive work environment.
Accordingly, employers who are
on guard to avoid a hostile environment based on sex must also
be on guard to prevent a hostile environment based on age, religion,
race, national origin, disability, etc. Just as a sexual jokes
can create a hostile environment, so can ethnic jokes. In this
regard, it should be noted that two black employees at Morgan,
Stanley & Co. recently filed suit against the firm alleging
that the firm created a hostile environment by permitting e-mail
to be transmitted that contained vile and offensive racial remarks.
According to the complaint, when they complained about the e-mail,
they were threatened with demotion and termination.
A hostile work environment based
on race played a key role in a case in California where a jury
returned a verdict of $11.1 million to a former sales employee
of Pitney Bowes who had resigned after numerous instances of
harassment including incidents where co-workers made racial
remarks.
In order to avoid this kind of
suit, it is necessary for employers to extend their anti-sexual
harassment policies to cover other kinds of prohibited harassment.
This includes providing a procedure by which employees can complain,
without retaliation, of such harassment, the prompt investigation
of such complaints, and appropriate remedial action at the conclusion
of such investigations. Companies who have such policies and
comply with them can usually avoid exposure to harassment claims.
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MICROSOFT
DECISION SHOWS RISK OF TREATING EMPLOYEES AS INDEPENDENT CONTRACTOR
In recent years, companies have
sought to avoid providing benefits and the consequences of the
numerous employment statutes by treating workers as independent
contractors or by leasing workers from other companies. However
the recent decision by the United States Court of Appeals in
Vizcaino, et al. v. Microsoft Corp., as well as actions
by numerous administrative agencies, show that the supposed
benefits of these practices can prove to be illusory, and employers
who engage in these practices can be subject to substantial
exposure.
In the Microsoft case,
the company had supplemented its core staff with individuals
called "freelancers" who were engaged when Microsoft
needed to expand its workforce to meet the demands of new product
schedules. These freelancers were fully integrated into its
workforce. They worked on the same teams with regular employees,
shared the same supervisors, performed identical functions and
worked the same hours. However, they did not receive the same
employee benefits that regular employees received. All of these
individuals were told when they were hired that they would not
be eligible for benefits and signed agreements in which they
acknowledged being independent contractors and being responsible
for all taxes, withholding, social security, insurance and other
benefits. The court concluded that these individuals were, in
fact, employees entitled , under ERISA, to the same benefits
that the regular employees enjoyed.
This decision indicates that if
individuals are treated in every respect as employees, the mere
fact that they are designated as "independent contractors"
will not establish such status. In order to establish "independent
contractor" status, companies must show that the individuals
involved have the right to control the manner and means by which
they perform their work. This can include setting their own
hours, the right to refuse assignments, the right to subcontract
work, or the right to work for other companies. Many administrative
agencies also require some evidence that the individual has
some investment in equipment and the ability to sustain both
a profit and a loss.
Companies who lease employees from
other companies who anticipate immunity to the various employment
statutes may also be surprised. Even though leased employees
may be on the payroll of another company, that does not preclude
them from being considered the employees of the lessor company.
A lessor company and a lessee company can be joint employers
where the lessor company retains control over the terms and
conditions of employment of the leased employees. In determining
joint employer status, the National Labor Relations Board will
look at such factors as supervision of the workers, ability
to hire and fire, involvement in day-to day labor relations,
establishing wage rates, promoting and disciplining. The bottom
line is that if these leased employees are treated the same
as your regular employees, they will be legally deemed to be
your employees as well as those of the leasing company. The
National Labor Relations Board recently conducted oral argument
on cases involving joint employer issues where leased employees
were utilized. It is anticipated that the NLRB will issue decisions
which will broaden the rights of these leased employees to organize
and otherwise be treated in the same way as the regular employees
of these companies.
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AVOIDING
WORKPLACE VIOLENCE
The statistics are startling: Each
year almost one million people are injured in the United States
as the result of violence taking place in the workplace. Sixteen
percent of all violent crime in this country occurs in the workplace.
Workplace violence is the leading cause of fatalities in the
workplace for women and the second leading cause of death for
men in the workplace. An average of twenty employees are the
victims of homicide in the workplace each week. More than half
of all workers fatally injured on the job in the New York Metropolitan
area die as the result of a violent act, the highest rate in
the country and double the national rate..
In light of these statistics, it
is not surprising that state and federal governmental entities
are attempting to address this issue. The United States Department
of Labor Occupational Safety & Health Administration (OSHA)
is seeking to hold employers responsible for workplace violence
under some circumstances. In furtherance of this objective,
it has promulgated Guidelines for Preventing Workplace Violence
for Health Care and Social Service Workers and has circulated
for discussion and comment a draft of Guidelines for Workplace
Violence Prevention Programs for Night Retail Establishments.
OSHA has targeted these two industries for their first
efforts in this area because a disproportionate number of violent
incidents occur in these industries. Nearly two-thirds of all
non-fatal assaults occur in the health care industry--primarily
encounters between patients and nursing staff. The OSHA guidelines
cite several factors which put workers in the health care industry
at increased risk: prevalence of handguns around patients and
their families; the increasing number of acute and chronically
mentally ill patients now being released from hospital without
follow-up care; the availability of drugs or money at hospitals,
clinics, and pharmacies; low staffing levels; isolated work
with clients during examinations or treatment. Workplaces in
the night retail industry including taxicab establishments,
liquor stores, gas stations, grocery stores, jewelry stores,
hotels/motels and eating/drinking places have the highest rates
of homicide in the nation. The draft guidelines for the night
retail industry identify six factors that increase the risks
of homicide in the workplace, all of which are usually present
in night retail establishments: (1) exchange of money with the
public; (2) working alone or in small numbers; (3) working late
night or early morning hours; (4) working in high-crime areas;
(5) guarding valuable property or possessions; (6) working in
community settings.
Both sets of guidelines address
only the issue of violence inflicted by third parties, such
as robbers or muggers, against employees. They do not address
the issue of co-worker violence. These guidelines advocate the
establishment of a violence prevention program. The elements
of such a program include (1) management commitment and employee
involvement, (2) worksite analysis, (3) hazard prevention and
control, and (4) safety and health training. Each prevention
program should also include recordkeeping and evaluation.
Although the guidelines are currently
only advisory and failure to adopt them does not constitute
an automatic violation of OSHA, employers can be cited under
the general duty clause of the Act if violence is a recognized
hazard in their establishments and they do nothing to prevent
it.
The New York State Legislature
is also considering legislation dealing with the workplace violence
issue. One bill would create an exception to the workers' compensation
law in order allow employees who are sexually assaulted in the
workplace due to derelict or negligent hiring practices of their
employer to recover all damages commensurate with their injury.
This proposed legislation is a response to a case where an employee
at Saks Fifth Avenue was raped by a security guard who had been
hired by Saks notwithstanding a previous conviction for sexual
assault. If enacted into law, this would require employers to
become more diligent checking into the backgrounds of its job
applicants before offering them employment. The other pending
bill would permit employers to seek injunctive relief on behalf
of employees who have been the victims of violence in the workplace
or who have been the recipients of credible threats of violence
which can reasonably be construed to be carried out in the workplace.
This would be particularly applicable of victims of domestic
violence.
Clearly, workplace violence is
going to constitute a new responsibility for employers. Employers
who wish to establish a workplace violence prevention program
should make sure that the following elements are included:
1. Pre-employment screening.
A background check to determine if there are any relevant prior
criminal convictions should be performed. However in performing
such an investigation, it is important to bear in mind that
under Title VII of the Civil Right Rights Act, employment decisions
based on arrest records are unlawful since they have
a disparate impact on protected groups. Similarly, pre-employment
inquiries as to the mental disability of a job applicant is
generally prohibited under the Americans with Disabilities Act.
However, an employer may screen out applicants who pose "a
direct threat to the health or safety of other individuals in
the workplace". A "direct threat" is defined
as a "significant" risk to the health or safety of
others that cannot be limited by reasonable accommodation. An
employer must meet very specific and stringent requirements
to establish the existence of a direct threat. The assessment
of risk must be based on objective medical or other factual
evidence regarding a particular applicant. In addition, the
employer must consider whether the risk can be eliminated or
sufficiently alleviated by reasonable accommodation.
Checking with prior employers should
be done even though it will probably prove to be a frustrating
experience. Most employers, in order to avoid exposure to defamation
suits, will provide only a neutral reference verifying only
dates of employment, classification, and salary levels without
making either any positive or negative comments about the employee's
job performance.
2. Training. Managers must
be trained on appropriate ways to handle employee terminations
and discipline. In addition, they must be trained to spot employees
who are potentially violent so that preventive action can be
taken. Such preventive action may include referral of an employee
to an employee assistance plan (EAP).
3. Establishment of Worker-Management
Safety Committees. Avenues of communication should be opened
to allow workers to suggest methods of improving security and
warn of potentially violent situations.
4. Creation of Clear Rules Relating
to Employee Conduct. The employer should promulgate a written
policy of zero-tolerance for workplace violence, verbal and
nonverbal threats, and related conduct.
5. A Comprehensive Security
Plan. Such a plan should include a procedure for dealing
with incidents; the assignment to an individual of responsibility
for maintaining security in the workplace; and establishing
a liaison with law enforcement representatives.
Statistics are unavailable to verify
whether the adoption of such measures will in fact reduce the
likelihood of workplace violence. However, it is clear that
employers who fail to take such measures may be exposing themselves
to OSHA citations and negligent hiring lawsuits.
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EMPLOYEE
HANDBOOKS : A TOOL TO USE IN AVOIDING EMPLOYMENT LITIGATION
A variety of factors have contributed
to the explosive growth of employee lawsuits. New laws such
as the Civil Rights Act of 1991, which gave employees the right
to jury trials in federal discrimination lawsuits, have encouraged
unhappy ex-employees to file suit. As the stakes have increased
in this litigation, so have the costs of defending these suits.
Companies do not have to be passive and stand back and just
allow these suits to happen. Rather, companies can be pro-active
and adopt programs that can minimize the chances of employee
lawsuits and minimize the costs and exposure of such lawsuits
when they do happen.
One of the tools that a company
can adopt is the creation of an employee handbook. By setting
forth policies in black and white, an employee handbook eliminates
ambiguities that can lead to litigation. For example, if the
employee handbook contains an explicit policy on procedures
for employees to follow if they wish to complain of sexual harassment,
an employee cannot claim they did not know there was a procedure
to investigate such complaints. If an employee fails to utilize
such internal procedures before filing suit, the lawsuit will
in most circumstances be dismissed. Similarly, if an employee
handbook sets forth what is considered prohibited employee conduct,
an employee cannot claim that such conduct was not prohibited
or that he did not know that such conduct was prohibited.
It is not sufficient for an employer
to merely draft a handbook, distribute it to the employees and
then put it in a drawer. It is essential that the policies set
forth in the handbook be followed consistently. In fact, an
employer's failure to comply with its own handbook can be considered
to be evidence of disparate treatment or discriminatory motive
in an employee lawsuit. It is also necessary for supervisors
to be trained about the provisions of the handbook and employment
laws, in general, so that your company will not inadvertently
commit violations of the various employment laws. Disciplinary
incidents must be consistently documented in writing to establish
that any particular employee was not singled out for violations
of any particular policy.
Many companies are wary of employee
handbooks because they are concerned that they create employment
contracts. This is not a valid concern. Under Louisiana law,
employers will not be bound by a properly-drafted handbook.
The only exception to this rule exists where the handbook contains
a provision which expressly limits the employer's right to terminate
the employee and there exist special circumstances which show
the employee's detrimental reliance on that provision.
There is no doubt we live in difficult
and litigious times. Any termination of an employee today can
lead to a federal lawsuit. However, companies do have the choice
of lighting a candle instead of just cursing the darkness. The
adoption of an employee handbook in conjunction with progressive
disciplinary policies, supervisor training, consistent documentation
of disciplinary action can reduce the chances that your company
will be involved in an expensive lawsuit.
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For more information on Employment Law
please e-mail us at:
info@panalaw.com
