LEGAL AND LEGISLATIVE UPDATE ON EMPLOYMENT LAW
Bob Gregg
phone: (608) 283-1751
fax: (608) 283-1709
rgregg@boardmanlawfirm.com
Bob Gregg
January, 2010
LEGISLATION AND ADMINISTRATIVE ACTION
COBRA subsidy extended. The COBRA subsidy enacted by the American Recovery and Reinvestment Act of 2009 (ARRA) has been amended and extended as of December 19, 2009 by the Department of Defense Appropriations Act, 2010 (DOD Act).
- An Assistance Eligible Individual (AEI) is now entitled to15 months of the subsidy.
- The previous requirement that the individual had to lose coverage on or before December 31, 2009, has been modified so that now the qualifying event, which makes a qualified beneficiary eligible for COBRA continuation coverage, must occur on or before February 28, 2010.
- Any individual who was an AEI on or after October 31, 2009, or who experienced a qualifying event (consisting of termination of employment-both voluntary and involuntary) relating to COBRA continuation coverage on or after October 31, 2009 through December 19, 2009, will have to be provided with notice by February 17, 2010 of the changes made to the COBRA subsidy by the DOD Act.
- Any individual who experienced a qualifying event after December 19, 2009, will have to be provided with the COBRA election notice in the normal time frame, and that notice must contain the information regarding the changes made to the COBRA subsidy by the DOD Act.
- Any individual who lost the subsidy because the previous nine (9) months of qualification expired prior to December 19, 2009, must receive notice by February 17, 2010 of the changes made to the COBRA subsidy by the DOD Act. This notice must also advise the individual of the right to make retroactive COBRA subsidy payments to maintain his or her COBRA continuation coverage. To do so, the individual must make the retroactive payment(s) by February 17, 2010, or, if later, within 30 days after the required notice is provided.
- Any individual who paid the full premium, and who would have been eligible for the COBRA subsidy had the changes to the COBRA subsidy by the DOD Act been available sooner, must receive a refund or a credit against future premiums. [For more information or questions, contact Cliff Bobholz.]
OFCCP promises more audits. Government contractors can expect a stepped-up audit program. The OFCCP's 2010 budget has a 25% increase, for the purpose of doubling Affirmative Action Plan compliance reviews.
LITIGATION
The Legal Update includes new developments and matters of interest throughout the United States. Be aware that our various federal circuit courts reach somewhat differing conclusions. So a federal court decision in another part of the country, and especially a different state's court decision, may not quite be "the law" in your jurisdiction. Some courts lead the way; others lag behind. The Legal Update lets you see the overall trends and compare them with your jurisdiction. Wisconsin is part of the Federal Seventh Circuit (Wisconsin, Illinois and Indiana).
Case of the Month:
The Importance of Posting Notices
Employee who saw posters had no excuse for late filing. An employee did not follow the proper process for filing a Rehabilitation Act complaint with the EEOC in the proper time frame. He claimed excusable neglect. However, he then admitted he had seen the EEO posters on the workplace bulletin board. The court ruled that since the posters described the proper process and time for filing complaints, the employee had the opportunity to know what he should have done, whether he actually read the posters or not. Thus, his failure to file on time was not excusable, and the case was dismissed. Gaillard v. Dept. of Veteran Affairs (11th Cir., 2009). [This case illustrates the importance of maintaining prominent posters and also of explaining those posters and related company handbook policies during new employee orientation. Have people sign off that they have seen key posters and policies. One of the prime causes of "preventable liability" is the failure to prominently post and update state and federally-required posters.]
Technology
A similar area to posting notices is keeping handbooks and policies up to date and designed to protect the organization. The following case illustrates the problem of not having the right policy.
Weak computer policy prevents company from suing ex-employee for continuing to access business information. The 9th Circuit Court dismissed the Computer Fraud and Abuse Act suit brought against a company's ex-employee. While employed, the company had provided the person with passwords to access information from his home computer. After he quit, he continued to access company information and used it in his new consulting business to refer clients to other competing businesses. In the ensuing suit, the court found the company had a weak IT policy. There was no prohibition against downloading information onto a home computer, no requirement to return or delete information after use or upon termination, and the company had neglected to void the password when the employee resigned. Thus, the court decided that the ex-employee had committed no violations warranting a suit. LVRC Holdings v. Brekka (9th Cir., 2009).
discrimination
Jurisdiction
EEOC granted nationwide subpoena for local beard complaint. Two Muslim plaintiffs alleged they were refused hire as drivers due to UPS's refusal to allow them to wear religiously-required beards in "public contact" positions at its Rochester, New York location. The EEOC decided to expand its investigation of the complaint into a nationwide review of UPS's religious accommodation of dress codes, and issued a subpoena for information regarding all UPS operations. The company challenged the subpoena as overbroad for a locally-filed complaint. The court disagreed and ruled to enforce the subpoena. The EEOC is not restricted by a specific complaint. It has the right to investigate discrimination in either a narrow or broad manner at its discretion. If an issue comes to attention due to a localized complaint, the EEOC can broaden the scope of its inquiry and its anti-discrimination enforcement. EEOC v. United Parcel Service (2nd Cir., 2009). [UPS has a corporate policy regarding religious accommodation and exemption from its no-beard policy. There is an allegation that the local HR specialists may have not paid heed to the corporate policy. Now the entire company is under investigation. This is a good reminder that any organization should monitor and train to assure that managers in all branches are following the policies.]
Age
Throwing water vs. physical contact -- not similarly situated. Two employees were disciplined for an altercation. The two got into a loud and profane argument in the restroom. The 25-year-old threw water on the other and was suspended. The 45-year-old swung and hit the water-thrower, and was fired. She sued for age discrimination, claiming the younger employee was treated more favorably. The court dismissed the case, finding the behaviors were not similar. The older employee's behavior was more serious and deserved a greater level of discipline. Johnson v. Interstate Brands Corp. (6th Cir., 2009).
National Origin
Asians are not all alike. The 11th Circuit Court of Appeals reversed a district court's dismissal of a Taiwanese plaintiff's race/national origin discrimination case. The plaintiff, a professor of Taiwanese origin, had been discharged. However, he was replaced by a person of Asian-Indian origin. The district court ruled that since his replacement was also in the EEO category of "Asian-Pacific Islander" he could show no discrimination, and dismissed the case. The Appellate Court unanimously rejected that view. National origin is clearly not an everyone from the same continent is all alike issue. Race, too, can differ within a continent. The district court's interpretation was clearly erroneous. Chang v. Alabama Agric. and Mech. University (11th Cir., 2009).
Race
$1.2 million for racial harassment. A jury awarded $1.2 million to six African American steel mill employees. The jury found they had been racially harassed. The case included evidence of lynching reenactments, racial slurs over the company radio system, a variety of other racial insults, and the company store's sale of items bearing the company name with the Confederate flag, which continued after the company received complaints regarding that symbol. Bennett v. Nucor (E.D., Arkansas, 2009). The 4th Circuit Court of Appeals has also certified a class action race discrimination suit against Nucor at an east coast facility.
Sex
Failure to respond to request for raise is adverse action which extends statute of limitations indefinitely. Cases are beginning to be decided under the Lilly Ledbetter Fair Pay Act which creates a "forever" statute of limitations. Once an adverse pay action occurs, each successive pay check (or retirement account check) is a continuing violation of that action. The standard 300-day Title VII statute of limitations for filing suit is not applicable. Mikula v. Allegheny County of Pennsylvania (3rd Cir., 2009) involved an employee's request for a pay raise. The supervisor made no response. Much later the employee filed her sex discrimination case alleging unequal pay. The county defended, claiming that no actual decision had been made denying any request. The court disagreed, ruling that non-response to a pay raise request is a denial and has the same no-raise effect as a formal denial; thus, it is a "compensation decision" which fits into the Ledbetter Act's continuing violation provision.
Disability
Vacuuming and laundry are major life activities. A Rehabilitation Act plaintiff was able to survive a summary judgment challenge to whether her cancer treatments qualified her as "disabled" by being "substantially limited in a major life activity." Under the ADA's Amendments Act, the court interprets the law in a more inclusive manner. The cancer treatments caused significant pain and fatigue, and made it difficult or impossible to keep up with basic household tasks such as vacuuming, laundry, etc. The court ruled that these are tasks necessary for living in a healthy environment and "are part of the major life activity of caring for oneself." Therefore, her case on constructive discharge was allowed to proceed to trial. Pinegar v. Dept. of Veteran Affairs (M.D., Pennsylvania, 2009).
Interactive process not necessary when no accommodations exists. The ADA requires employee and employer to engage in interactive dialogue and exploration to consider reasonable accommodations, to enable a disabled employee to perform a job, or maintain employment in an available alternative position. However, no exploration is required when no accommodation is available. An employee's respiratory sensitivity to the chemicals in her work rendered her unable to continue the present job. She requested the accommodation of being placed in a different job in a different location where there were no chemicals. However, no such job was open. Since the ADA does not require either creation of a new job nor bumping existing employees out of their jobs to make way for a disabled employee, no accommodation existed. Therefore, there was no requirement for the company to further engage in a meaningless exercise of discussing a non-existent position. McBride v. Bic Consumer Products Mfg. Co. (2nd Cir., 2009).
Independent Contractors -- Disability
Independent contractor can sue under Rehabilitation Act. Independent contractors are not employees and, thus, do not have standing to sue under the employment laws such as Title VII or the ADA. However, the Federal Rehabilitation Act is broader. It incorporates all of the ADA's Title I employment requirements relating to discriminatory discharge, and allows independent contractors to sue for the termination of their contractor status. Fleming v. Yuma Regional Medical Center (9th Cir., 2009) involved a hospital in which the physicians were independently contracted. An anesthesiologist was diagnosed with MS. The Medical Center drafted a contract addendum which provided that it did not have to, and would not, engage in any reasonable accommodations, based on the doctor's non-employee/contractor status. The doctor claimed "constructive discharge" and filed suit under the Rehabilitation Act. The court denied the Medical Center's motion for summary judgment and validated the independent contractor's right to sue over the "discharge."