Labor and Employment Law

BELCHATOW POLAND - MAY 02 2013: Modern white keyboard with colored social network buttons.

By A. Edward Hardin, Jr.

Social media use by employees, and employers’ social media policies, continue to appear in the legal headlines.  Much of the recent news coverage has touched on action by the National Labor Relations Board (NLRB) and its assessment of employer social media policies.  However, recent legal action in Pennsylvania does not address the NLRB and its actions, but returns to somewhat traditional litigation.  The Charlotte Observer recently reported on a lawsuit filed by two American Airlines flight attendants who claimed they were subjected to sexual and gender harassment through social media.  The plaintiffs alleged that they reported the conduct to human resources, but that American Airlines failed to take action, and failed to enforce its own social media policy.  Although the allegations include the use of technology as tools of alleged abusive behavior, the underlying employee conduct appears to be typical of the kind of conduct that leads to litigation.  For more on the suit, click here.

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By Erin Kilgore and Scott Huffstetler

As with any change in administration, this is a time of uncertainty.  One example is the rights of transgender individuals to access certain restrooms in the workplace, which, based on recent events, will likely continue to be a source of uncertainty for many employers.

Federal law does not expressly prohibit discrimination based on transgender status.  Title VII is the federal employment law that prohibits discrimination based upon “sex” (among other protected characteristics).  The EEOC and some courts have interpreted “sex” under Title VII to include “gender identity.”  Under that interpretation, transgender individuals could be protected under Title VII.  Other courts have refused to adopt an expansive interpretation of “sex” and have left it to Congress to create transgender employee protections legislatively.

A case filed by a transgender male student against the Gloucester, Virginia school board over his use of the boys’ restroom, G.G. ex rel. Grimm v. Gloucester Cty. Sch. Bd., was on the trajectory to provide guidance on the issue of restroom access.  Grimm filed suit seeking to use school restrooms that aligned with his gender identity, rather than the restroom that corresponded with his birth sex.  Additional background information regarding the Grimm case can be found here.  Grimm is not a Title VII case, but concerns a different federal law, Title IX, which governs protections for students and employees in educational settings.  Although different laws, courts often look to Title VII to interpret Title IX, and, at times, vice versa.  Therefore, many predicted a decision in the Grimm case would have ripple effects into the employment arena and implications beyond restroom access issues.

However, on Monday, the Supreme Court announced it would not hear the case, and the case was sent back to the lower court.  That announcement came in the wake of a February 22, 2017 joint memorandum issued by the Department of Justice and the Department of Education, which revoked the Obama administration’s federal guidelines on transgender students’ use of restrooms.  As a result, the case law remains unsettled.  Employers should be aware of how the courts in their jurisdiction(s) interpret Title VII, as well as any state laws, regarding transgender rights and structure their policies and practices accordingly.

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By Jessica C. Engler

The IRS has sent an urgent alert to employers this month that a W-2 phishing scam that many companies fell victim to in 2016 is back in full force for 2017. The IRS warns that this scam is emerging earlier this year and is targeting school districts, tribal organizations, and nonprofits in addition to businesses.

The “W-2 Scam” is carried out by persons who disguise (“spoof”) an email to make it look like it came from a top executive or the receiver’s business colleague. The dummy email is sent to (typically) the organization’s accounting and human resources department, and will ask for a list—or the copies themselves—of the company’s W-2 tax forms, employee’s dates of birth, and Social Security Numbers. If the unsuspecting victim responds with this information, the sender can use this data to file false tax returns, generate revenue on the black market, and perpetuate identity theft.

While this email can take many forms, some example phrasing for the email includes:

  • “Please send me the individual 2016 W-2 (PDF) and earnings summary of all W-2s of our company staff for a quick review”
  • “Hope you had a nice weekend. Do you have PDF copies of the employee’s W-2s? Could you please send to me for a quick review?”
  • “I need you to email me the list of individual W-2 copies of all employees’ wages and income tax statements for 2016 tax year in PDF file format for quick review. Prepare the list and send to me ASAP. I will brief you more about this later.”

The IRS warning indicates that these phishing emails are also including requests for wire transfers this year.

The Security Summit (which comprises the IRS, state tax agencies, and members of the tax industry) recommend that employers and employees stay vigilant of this threat. Employers may consider doing additional training with employees on recognizing these phishing emails.

The IRS instructs any organization that receives a W-2 scam to forward that email to phishing@irs.gov and place “W2 Scam” in the subject line. Organizations that receive the scams or fall victim to the scam can file a complaint with the Internet Crime Compliance Center (IC3), which is operated by the Federal Bureau of Investigation. Organizations should also consider contacting an attorney with experience in data management to assist in the response to affected persons.

Day

By Michael D. Lowe

Last week, thousands of employees throughout the county skipped work as part of “a day without immigrants” demonstration. The employees were protesting the Trump administration’s recent actions regarding immigration. The stated intent was to negatively impact the nation’s economy in an effort to highlight the contributions of immigrant labor. Restaurants were the primary target. Businesses from New York to San Francisco were forced to temporarily close as employees either failed to report to work or “walked out.” In many cases, the protesting employees included both immigrants and their co-workers.

Several employers embraced the protests and promised not to discipline the participating employees. However, many employers took the opposite approach. According to various media reports, hundreds of employees in a number of different cities were terminated after they refused to report to work. With reports that additional demonstrations are likely, employers should prepare for the possibility that one or more employees might choose to participate.

As an initial matter, an employer should communicate its expectations to its employees in advance of any demonstration. If possible, this communication should be documented by internal memo, email, or even text message. Employees should also be reminded of any applicable attendance policies.

While the refusal to report to work is a legitimate non-discriminatory basis to terminate an employee, an employer must be consistent in its response. An employer that terminates some employees, while excusing the absences of others, may face a claim of disparate treatment. Those employers with a unionized workforce should consult labor counsel with regard to any collectively bargained rights.

Finally, affected employers should prepare for media coverage and press inquiries. The demonstrations have already garnered international attention as the debate regarding the Trump administration’s immigration policies shows no signs of slowing down. Employers should clearly define who within its organization may respond to media inquiries and what information will be shared. Any comments made following an employee’s termination will almost certainly be used in any resulting legal action.

Accessibility computer icon

By Price Barker, Brian Carnie, and Michael Lowe

Disability access lawsuits have become a cottage industry and they have found their way into Louisiana, Texas and Arkansas.  Most are brought by the serial litigants working with same law firm.  These plaintiffs visit a business for the primary purpose of discovering an Americans with Disabilities Act (ADA) accessibility violation and then file a federal court lawsuit without giving the property owner, tenant or business advance notice of their complaint or an opportunity to fix the problems.

Now we are seeing a growing trend of “drive by” or “Google” disability access lawsuits.  The tag “drive-by” lawsuit came about due to accusations in many of these cases that either the plaintiff, or their lawyer, simply drove by the business, observed an alleged violation, and then filed suit.  The tag “Google lawsuit” arose from the belief of several business owners who have been sued that the ADA violations (such as the failure to have a lift seat at a hotel swimming pool) were discovered using Google earth.  In “drive-by” or “Google” lawsuits, the plaintiff almost always seeks attorneys’ fees, expert witness fees, and other litigation costs, as well as other concessions from the business they have sued.  Under federal law, business owners often have to pay both sets of attorneys’ fees, and if they do not settle, or make the corrections to their property demanded in the suit, it may end up costing them many thousands of dollars more, leading to accusations that these suits are simply money-making ventures for the plaintiff bar.

The ADA was passed by Congress in 1990.  Every private business in the United States open to the public must comply with the ADA.  This includes restaurants, bars, convenience stores, hospitals, hotels, shopping centers, and other retail locations.  The accessibility requirements of the ADA are very specific, and extensive.  There are thousands of requirements to be found in the 275-page ADA manual, which has specific requirements for things such as the slope and length of wheelchair ramps, the location and signage for handicap parking spots, and the height and location of door handles, sinks, toilets, and grab rails.

ADA access litigation is not limited to parking lots, sidewalks, restrooms and other alleged physical barriers in a “brick and mortar” establishment.  A growing number of lawsuits are being filed claiming that the business’ Web site does not provide adequate accessibility to the visually or hearing impaired.  Since 2010, the United States Department of Justice (DOJ) has delayed issuing specific regulatory guidance directly addressing the accessibility standards for commercial Web sites.  That does not mean that businesses do not have to try to comply with the general requirements of the ADA, nor does it prevent DOJ enforcement or suits by private plaintiffs.

Numerous ADA access lawsuits have been filed in federal court in Shreveport.  One of the recently filed claims is a class-action filed by a registered sex offender against a local municipality, claiming that the office where he is required to register as a sex offender is now violating the ADA by not providing him with a sign language interpreter.

So what should a business owner do to avoid this expensive headache?  A good starting point is to make your business an unattractive target.  Visit your location to see if there are any obvious ADA violations that would catch the attention of a “drive-by” plaintiff.  For example, look for un-ramped entrance steps, poorly maintained routes from handicap parking spaces to the entrance, handicap parking spaces with no access aisle, and observe the slope of your handicap parking spaces.  If you can see a slope, it is probably non-compliant.  And if you can see the slope, you can bet the plaintiff driving by will too.

 

Man's Hands Signing Document --- Image by © Royalty-Free/Corbis

By Scott Huffstetler

Today, the United States Supreme Court decided to consider three decisions involving class-action waivers in employee arbitration agreements.  As background, many employers require employees to sign arbitration agreements.  In these agreements, employees give up the right to sue their employer and agree that all employment related claims will be subject to arbitration.  Many of these agreements contain class-action waivers, in which employees will agree only to bring employment related claims against the employer individually.  Essentially, by signing these agreements, employees waive their right to start or join class or collective actions.  These waivers are particularly important given the recent increase in class or collective employment suits brought against employers under the Fair Labor Standards Act (FLSA) and anti-discrimination laws.  These suits can be very costly and frustrating for employers.  The federal Fifth Circuit, which is the appeals court for federal courts in Louisiana, Mississippi, and Texas, upheld such a class-action waiver in NLRB v. Murphy Oil.  However, in two separate cases, the Seventh and Ninth Circuits, which are the appeals courts for federal courts in Illinois, Indiana, Wisconsin, Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, and Washington, held that such waivers violate the National Labor Relations Act’s (NLRA) protection of concerted activity.  The inconsistent law in this area has been troubling for employers with arbitration agreements, especially those operating in multiple jurisdictions.  Hopefully, the Supreme Court’s decision will provide needed clarity for employers who opt to have these agreements.

 

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By R. Lee Vail, P.E., Ph.D.

On November 18, 2016, the Occupational Safety and Health Administration (“OSHA”) issued a final rule “revising and updating its general industry standards on walking-working surfaces to prevent and reduce workplace slips, trips, and falls, as well as other injuries and fatalities associated with walking-working surface hazards.” 81 Fed. Reg. 82494 (Nov. 18, 2016) .  Regulations related to Walking-Working Surfaces are located at 29 C.F.R. 1010 Subpart D. Included in the rule are requirement relating to floors, ladders, stairways, runways, dockboards, roofs, scaffolds, and elevated work surfaces and walkways. The new rule incudes:

  • new design, performance, and use requirements for fall protection system to reflect advances in technology and industry best practices;
  • added flexibility to utilize personal protection systems (e.g., fall arrest, travel restraints, and work positioning systems) in lieu of guardrails;
  • harmonization of general industry and construction system and equipment requirements;
  • incorporation of provisions from recently adopted standards, included but not limited to requirements from Appendix C (Mandatory) of the Powered Platforms for Building Maintenance; and
  • incorporation of requirements from national consensus standards (e.g., Workplace Walking/Working Surfaces and Their Access, ANSI/ASEE A1264.1-2007, Personal Fall Systems, ANSI/ASSE Z359.1-2007, and Window Cleaning, ANSI/IWCA 1-14.1-2001.

This rule generally becomes effective and enforceable on January 17, 2017. Several of the requirements are not effective until a later date.

clock1

By Scott Huffstetler and Ed Hardin

In the wake of yesterday’s news that a Texas federal judge issued a nationwide injunction halting the FLSA overtime regulations, scheduled to become effective December 1, 2016, many employers are asking “what now.”  The answer will continue to develop.  For now, though, here are some initial things to keep in mind:

  1. Realize that the regulations scheduled to go into effect on December 1, 2016 are now halted nationwide.  This means that for the time being, the minimum salary threshold remains at $23,660 a year ($455 per week).
  2. Realize that this decision is not final and is subject to change.  The federal court only issued a preliminary injunction.  The next procedural step (if the parties choose to continue) is for discovery to be conducted, a trial on the merits, and a decision on whether a permanent injunction should be issued.  It is possible the judge could change his decision at the permanent injunction stage of the case.  Regardless of the outcome at that stage, appeals will be available to the U.S. Court of Appeals for the Fifth Circuit and the U.S. Supreme Court.  Although this scenario is less likely in the Fifth Circuit, with the passing of Justice Antonin Scalia, it is possible that the U.S. Supreme Court could ultimately rule in the U.S. Department of Labor’s favor.  Of course, that assumes the Department continues to pursue this matter and continues to pursue official enactment of the regulations.  Recall that the Department is an executive agency, which after January, will be under President-Elect Donald Trump.  Given the differences between President Barack Obama and President Trump’s labor initiatives, it is possible that President-Elect Trump will instruct the Department not to continue pursuing this case.  There are many variables and all of these scenarios will take months, or even years, to play out.  The point is the case needs to be monitored and employers need to be prepared for the different scenarios.
  3. Realize that not all the changes that may have been made in response to the new regulations related to the salary basis test.  Many employers used the change in the regulations to address other components of the FLSA that were not affected by the ruling, such as classifications.  To the extent changes like this were made, they were not altered by the ruling.

As is easily seen, the outcome of this saga remains to be seen.  For now, employers can be thankful this Thanksgiving for a reprieve from what was about to become a major change in the FLSA.

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By Erin Kilgore, Ed Hardin, and Brian Carnie

A federal district judge in Texas has entered a nationwide injunction which prevents the U.S. Department of Labor’s new FLSA minimum salary level rule from going into effect on December 1, 2016.  Prior to today, the DOL’s new rule would have nearly doubled the minimum weekly salary required in order to be exempt under the so-called white collar exemptions (the executive, administrative and professional employee exemptions).

The court found that the Department of Labor exceeded its authority when it issued the final rule in May 2016.   The court also found that the Department of Labor ignored Congress’s intent by raising the minimum salary level such that it supplants the duties test.  The court’s preliminary injunction ruling will preserve the status quo until the court makes additional determinations related to the Department of Labor’s authority and the final rule’s validity.

Until further notice, the minimum salary threshold remains at $23,660 a year ($455 per week).  Stay tuned for further analysis.

aca

By Brian R. Carnie

On Friday, November 18, 2016, the IRS announced an automatic extension of the Affordable Care Act deadlines for distributing the 1094-B/1095-B and 1094-C/1095-C forms to employees. This relief gives applicable employers an additional 30 days (from January 31, 2017 to March 2, 2017) to deliver these forms to employees. This relief only applies for the 2016 reporting year.

The IRS did not change the deadlines for filing the Forms 1094 and 1095 with the agency. The deadline for filing these forms by mail is February 28, 2017. Employers filing electronically have until March 31, 2017.

Similar to 2015, the IRS also announced it would not penalize employers for incorrect or incomplete forms for 2016 as long as they make good faith efforts to comply. This relief is not available for covered employers who fail to timely file the forms. Although there is much talk about repealing and replacing the ACA once the new administration takes office, until Congress acts (which likely won’t happen until after the 2016 reporting deadlines have passed) we recommend that employers comply with the current requirements to avoid unnecessary penalties or fines.

Stay tuned for future anticipated changes!