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Homeland Security Department way out of line
June 30, 2006 by Ross Runkel at LawMemo
Congress told the Department of Homeland Security to come up with a "human resources management system." They did. One that is unlawful and bizarre according to the DC Circuit, which upheld an injunction against parts of the system.
Here's what the Department of Homeland Security did: Adopted a formal regulation (the "Final Rule") that
- defines the scope of collective bargaining for DHS unions
- channels some disputes through the Federal Labor Relations Authority (FLRA)
- creates a Homeland Security Labor Relations Board
- assigns an appellate role to the Merit Systems Protection Board (MSPB)
The DC Circuit held:
- The Final Rule unlawfully reserves to the DHS the right to unilaterally abrogate collective bargaining agreements that are lawfully negotiated and executed pursuant to the human resources management system.
- The Final Rule violates the federal statute by limiting the scope of bargaining to employee-specific personnel matters (e.g., discipline, discharge, promotion) and not extending it to other terms and conditions of employment.
- The DHS exceeded its authority by imposing onto the Federal Labor Relations Authority (FLRA) (an independent agency) a novel appellate function, defining FLRA jurisdiction, and dictating FLRA standards of review.
- Two issues were not ripe for review:
- A claim that DHS was not authorized to change the standard by which MSPB might mitigate a penalty for employee misconduct
- A claim that funneling bargaining disputes to the Homeland Security Labor Relations Board does not provide neutral adjudication
The case: NTEU v. Chertoff (DC Cir 06/27/2006)
My view: Crass overreaching by the Department of Homeland Security, clearly exposed in the court opinion written by labor law expert Judge Harry Edwards.
More commentary: D.C. Cir.: Homeland Security Personnel Rules Violate Workers' Rights at Workplace Profs Blog.
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Airport security company is under NLRB jurisdiction
June 29, 2006 by Ross Runkel at LawMemo
A company that provides passenger and baggage screening services pursuant to a contract with the Transportation Security Administration is subject to the National Labor Relations Board's jurisdiction.
Firstline Transportation Security, Inc (347 NLRB No. 40 - 06/28/2006).
The Board split 4-1. Details: NLRB Law Memo 06/29/2006.
Rejecting national security concerns, the Board said:
"The Board has been confronted with issues concerning national security and national defense since its early days. Our examination of the relevant precedent reveals that for over 60 years, in times of both war and peace, the Board has asserted jurisdiction over employers and employees that have been involved in national security and defense. We can find no case in which our protection of employees' Section 7 rights had an adverse impact on national security or defense."
Seems right to me.
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Independent contractor? or Employee?
June 23, 2006 by Ross Runkel at LawMemo
W2? or 1099? That is the question. Is that worker an independent contractor, or an employee? The IRS is quite interested because it makes a big difference.
Strategic HR Lawyer tipped me off to the following recent fact sheet from the IRS, quoted here in full:
IRS Reminds Businesses to Classify Workers Correctly
FS-2006-21, June 2006
The rash of natural disasters that have hit the United States in the last several months have caused many businesses to hire additional workers to help them meet increased demand for their goods or services. These businesses must make sure they treat their workers properly to make sure everyone can meet their tax obligations.
Most workers fall into two categories:
- Independent contractors
- Common-law employees
The main factor a business must use in determining how to classify its workers is the degree of control the business has over its worker. The more control the business has over a worker; the more likely it is that the worker is an employee rather than an independent contractor.
A business must base its determination as to whether a worker is an employee or an independent contractor on all facts and circumstances of its relationship with the worker. Businesses can use Form SS-8, Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding, to have the IRS make the determination.
It is critical that the business correctly determine whether the individuals providing services are employees or independent contractors. An employer must withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wages paid to an employee. In addition, other tax issues, including the provision of certain employee benefits, depend upon the proper classification of workers.
A business generally does not have to withhold or pay any federal taxes on payments to independent contractors. However, independent contractors are subject to self-employment tax and should plan accordingly.
If a business incorrectly classifies a worker, the business could be subject to penalties.
There may be relief for employers who want to correct any errors they may have made by classifying an employee as an independent contractor.
IRS Headliner 152, IRS Offers Tips on How to Correct Misclassification of Employees, contains additional information about correcting worker classification.
Also, additional information about worker classification and classification correction are in:
- Publication 15-A, Employer’s Supplemental Tax Guide
- Publication 1779, Independent Contractor or Employee brochure.
- Publication 1976, Independent Contractor or Employee? Section 530 Employment Tax Relief Requirements
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Burlington Northern v. White - Title VII retaliation - analysis
June 22, 2006 by Ross Runkel at LawMemo
What kind of employer actions can be retaliation under Title VII? Burlington Northern v. White (US Supreme Court 06/22/2006) gives these answers.
Basic rule:
"We conclude that the anti-retaliation provision [Section 704] does not confine the actions and harms it forbids to those that are related to employment or occur at the workplace. We also conclude that the provision covers those (and only those) employer actions that would have been materially adverse to a reasonable employee or job applicant. In the present context that means that the employer's actions must be harmful to the point that they could well dissuade a reasonable worker from making or supporting a charge of discrimination."
- No link to employment is needed.
Unlike Title VII's basic anti-discrimination section (703), the anti-retaliation section (704) has different language and a different purpose. Section 703 prohibits discrimination with respect to conditions of employment, but Section 704 has "no such limiting words." Section 703 prevents injuries based on who people are (based on sex, race, etc.), while Section 704 is based on what people do (e.g., filing an EEOC charge or complaining to management). Limiting Section 704 retaliation to employer actions that are work-related or employment-related would not achieve Section 704's purpose.
Examples:
- Rochon v. Gonzales, 438 F. 3d 1211 (DC Cir 2006). Retaliation against FBI agent took the form of the FBI's refusal, contrary to policy, to investigate a death threat against the agent.
- Berry v. Stevinson Chevrolet, 74 F. 3d 980 (10th Cir 1996). Employer filed false criminal charges against a former employee.
- Material adverse action. In order to "separate significant from trivial harms," the Court requires the employee to show that the employer's action was "materially adverse." This will exclude "petty slights or minor annoyances."
- Reaction of a reasonable employee. The Court adopted an objective standard, so an individual employee's "unusual subjective feelings" will not be relevant. The focus is on the materiality of the employer's action and "the perspective of a reasonable person in the plaintiff's position."
Examples:
- Changed job duties. In the Burlington case, the employer changed the employee's duties, however the duties were still within her job description. The job description did not matter. What mattered was that the new job was dirtier, harder, less prestigious, and perceived by other employees as being worse.
- Temporary suspension. In the Burlington case, the employee was suspended for 37 days, and then reinstated with back pay. The Court said a reasonable employee would find a month without a paycheck to be a "serious hardship."
- Schedule change. Might not matter to many employees, but "may matter enormously to a young mother with school age children."
- Refusal to invite to lunch. Usually trivial, but exclusion from a weekly training lunch might well deter a reasonable employee from complaining.
My view: This Court understands how to read a statute.
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Burlington Northern v. White - Title VII retaliation has broad definition
June 22, 2006 by Ross Runkel at LawMemo
The US Supreme Court has adopted a broad definition of retaliatory actions under Title VII, interpreting Section 704 as applying to actions that "could well dissuade a reasonable worker from making or supporting a charge of discrimination."
The Court said:
We conclude that the anti-retaliation provision [Section 704] does not confine the actions and harms it forbids to those that are related to employment or occur at the workplace. We also conclude that the provision covers those (and only those) employer actions that would have been materially adverse to a reasonable employee or job applicant. In the present context that means that the employer’s actions must be harmful to the point that they could well dissuade a reasonable worker from making or supporting a charge of discrimination.
Burlington Northern v. White (US Supreme Court 06/22/2006).
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Systemic compensation discrimination - new regs
June 21, 2006 by Ross Runkel at LawMemo
US Department of Labor's Office of Federal Contract Compliance Programs has published formal standards for interpreting the anti-discrimination requirements of Executive Order 11246, with the focus on systemic compensation discrimination.
Key features:
- (1) Adopts the EEOC's method for determination which employees are similarly situated - similarity of work, level of responsibility, skills, and qualifications.
- (2) Relies on multiple regression statistical analysis.
- (3) Considers both statistically significant compensation disparities and anecdotal evidence.
- (4) Describes voluntary guidelines for self-evaluation, and provides incentives for using them.
Full text: Final Interpretive Standards For Systemic Compensation Discrimination Under Executive Order 11246 (06/16/2006)
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3rd - Ministerial exception case will be re-heard.
June 20, 2006 by Ross Runkel at LawMemo
In a May 24 opinion a three-judge panel of the 3rd Circuit refused to dismiss a Title VII suit brought by a church chaplain against her church employer. The panel adopted a "carefully tailored version of the ministerial exception."
The judges were split 2-1. The author of the majority opinion had died prior to the date the case was filed. Lots of folks wondered whether a dead judge's vote could count, and whether the opinion would hold up.
Now the 3rd Circuit has vacated the panel judgment issued May 24, and referred the case for rehearing. One of the original panel members has died and another has recused, so two new judges have been appointed. Petruska v. Gannon University (3rd Cir 06/20/2006).
The May 24 opinion (now vacated): Petruska v. Gannon University (3rd Cir 05/24/2006).
Full text of the latest order:
A majority of the active judges having voted, it is ordered that the petition is GRANTED. The Clerk of this Court is directed to VACATE the judgment of this Court filed May 24, 2006, and to refer the case to the panel for panel rehearing. Because Judge Edward R. Becker has died and circumstances have arisen which require Judge Richard L. Nygaard to recuse, Judge Morton I. Greenberg and Judge Robert E. Cowen, who were selected by random lottery by the Clerk, are assigned with Judge D. Brooks Smith to a panel to rehear and determine the case.
My previous comments on this case:
- Ministerial exception limited in Petruska v. Gannon University
- Ministerial exception - the end is coming
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NLRB takes aim at arbitration clause
June 19, 2006 by Ross Runkel at LawMemo
Did you think the NLRB would hold that a mandatory arbitration policy adopted by a non-union employer violated the National Labor Relations Act?
That's what they did in U-Haul Company of California (NLRB 06/08/2006) (2-1).
Primary reasoning: "because the employees would reasonably construe the broad language to prohibit the filing of unfair labor practice charges with the Board."
The case is important because the Board held the arbitration policy on its face was an unfair labor practice, even though there was no proof that anybody had ever been deterred from utilizing the NLRB's processes.
The employer made agreement to an arbitration policy a condition of employment or continued employment. The policy states that it:
. . . applies to all ... employees, regardless of length of service or status and covers all disputes relating to or arising out of an employee’s employment with [the employer] or the termination of that employment. Examples of the type of disputes or claims covered by the [Arbitration Policy] include, but are not limited to, claims for wrongful termination of employment, breach of contract, fraud, employment discrimination, harassment or retaliation under the Americans With Disabilities Act, the Age Discrimination in Employment Act, Title VII of the Civil Rights Act of 1964 and its amendment, the California Fair Employment and Housing Act or any other state or local anti-discrimination laws, tort claims, wage or overtime claims or other claims under the Labor Code, or any other legal or equitable claims and causes of action recognized by local, state or federal law or regulations. [Emphasis added.]
The NLRB put its focus on the bold language.
The majority said:
We recognize that the language in the arbitration policy does not explicitly restrict employees from resorting to the Board’s remedial procedures. However, the breadth of the policy language, referencing the policy’s applicability to causes of action recognized by “federal law or regulations,” would reasonably be read by employees to prohibit the filing of unfair labor practice charges with the Board. Plainly, the employees would reasonably construe the remedies for violations of the National Labor Relations Act as included among the legal claims recognized by Federal law that are covered by the policy. Thus, we find that the language of the policy is reasonably read to require employees to resort to the Respondent’s arbitration procedures instead of filing charges with the Board.
The decision was 2-1, with Member Wilma B. Liebman and Member Peter C. Schaumber in the majority, and Chairman Robert J. Battista dissenting.
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Drinking in a public place while in uniform
June 17, 2006 by Ross Runkel at LawMemo
Postal Service regulations forbid drinking in a public place while in uniform. OK. What's a "public place"?
How about a Veterans of Foreign Wars (VFW) post?
The USPS thought so when it fired Gary Gose.
Understand that the VFW is a private club, and in order to get in to the place where Gose was drinking you had to be a member.
Undaunted, the USPS proposed that a "public place" is anywhere that Postal Service customers can be found.
Not so, says the US Court of Appeals for the Federal Circuit. That's an unreasonable interpretation. Gose v. US Postal Service (Fed Cir 06/14/2006).
So Gose is back carrying your mail.
He's probably not at the VFW. It seems that all of this got started when 30 people signed a complaint letter. I assume it was signed by folks who drink without being in uniform.
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Inflatable rats featured in NLRB General Counsel report
June 16, 2006 by Ross Runkel at LawMemo
NLRB Law Memo says:
General Counsel Ronald Meisburg has issued his first report on cases decided on a request for advice or on appeal from a Regional Director's dismissal of unfair labor practices, plus requests for Board authorization for injunction proceedings under Section 10(j).
Cases include a General Counsel decision to ask the NLRB to modify a 2001 holding that contract language standing alone is sufficient to establish a Section 9(a) relationship in the construction industry, a decision on whether a union's display of an inflatable rat is a secondary boycott, and a proposed remedy for an employer unilaterally implementing surveillance cameras.
Get the whole thing here: Report on Case Developments January through March 2006 (06/15/2006)
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Workers compensation is not an employee benefit plan
June 15, 2006 by Ross Runkel at LawMemo
When Howard Delivery Service went bankrupt, it owed Zurich American Insurance $400,000 on account of unpaid workers compensation insurance premiums.
Zurich filed a creditor's claim, asserting that the premiums were entitled to priority on the ground that they were unpaid "contributions to an employee benefit plan" under 11 USC Section 507(a)(4).
The US Supreme Court held (6-3) that workers compensation premiums fall outside the priority allowed by Section 507(a)(4). Howard Delivery Service v. Zurich American Ins (US Supreme Court 06/15/2006)
| Employment Law Memo notified its readers about this case on 06/15/2006, shortly after it was decided. |
The Supreme Court said such premiums are more appropriately bracketed with liability insurance premiums (e.g., motor vehicle, fire and theft) than with contributions made for fringe benefits that complete a pay package (e.g., pension plans, group health, life, disability).
Interesting logic: The primary reason is that workers compensation regimes provide something for employees (payments for injuries) and also something for employers (avoiding tort litigation and large judgments).
The dissent's logic: workers compensation insurance qualifies as an "employee benefit plan" because it clearly provides benefits to employees.
Interesting combination of Justices:
Majority: Ginsburg, Roberts, Stevens, Scalia, Thomas, Breyer.
Dissent: Kennedy, Souter, Alito.
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Employment law verdict reports
June 13, 2006 by Ross Runkel at LawMemo
In my law practice days I liked knowing what juries were doing with cases similar to mine.
For employment lawyers, there is a new publication providing information about jury verdicts in employment law cases in federal courts.
- Publication: The Labor & Employment Verdict Reporter
- Sample: 1 LEVR 1 (July 2006)
- Format: Monthly. Print or pdf file via email
- Publisher: Jury Verdict Publications
- Publisher's description:
The Labor & Employment Reporter is a new publication that fills a labor and employment void regarding verdict results -- we publish more verdict results than anyone -- in our premiere issue, we've chronicled fifty-eight labor and employment verdicts from all over the country. These aren't settlements or mediations -- these are jury trial results from federal court throughout the U.S. involving discrimination, retaliation, harassment and other employment civil-rights and tort claims.
My source: Workplace Prof Blog - New Newsletter
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Ministerial exception - the end is coming
June 12, 2006 by Ross Runkel at LawMemo
It's too early to announce the demise of the ministerial exception, but the smell of death is in the air. The US Supreme Court will be the final executioner.
The majority rule - the ministerial exception
Typical facts: A church employs a minister. ("Minister" includes ordained ministers, music directors, and teachers, but not clerks and janitors.) The minister sues the church claiming a violation of Title VII (sex harassment, gender discrimination, race discrimination, retaliation) or a violation of the Age Discrimination in Employment Act (ADEA).
Most courts apply the ministerial exception, resulting in the case being dismissed. They say courts can't touch these cases without running afoul of the religion clauses in the 1st amendment. It does not matter whether the church had a religious basis for making its decision.
This majority rule has been around for decades, and recently got a ringing endorsement from Judge Posner in Tomic v. Catholic Diocese (7th Cir 04/04/2006). He's a smart judge, and I have a lot of respect for his work.
Why the ministerial exception is wrong.
The ministerial exception is supposed to protect the church's freedom of religion and to prevent an establishment of religion, as required by the 1st amendment. However, courts apply the ministerial exception even when the church has not asserted that the case has anything to do with religion. As I've said before (Ministerial exception: putting churches above the law):
Courts that apply the ministerial exception are granting the church a blanket "hands-off" rule that makes no distinction between whether the church's actions are religiously based or not. Makes no sense. If the church has a religious reason for its action, then it should be shielded by the Free Exercise clause. When the claim is something like sex harassment, and that has no grounding in the religion, then there should be no free exercise problem. I see little force in the Establishment clause in these cases because there is no more entanglement than there would be in an ordinary assault-and-battery case.
Courts going the other direction
A minority of courts are rejecting the ministerial exception. See:
- Ministerial exception limited in Petruska v. Gannon University
- Ministerial exception: putting churches above the law
The final outcome
Courts that follow the ministerial exception will continue the error of their ways. It will take action by the US Supreme Court to put it to an end. I expect that Court (some day) will recognize that the 1st amendment does not give the church a blanket defense, and will construct a more sophisticated solution to reconciling Congress' anti-discrimination statutes with the 1st amendment.
My suggestion is to follow the holding in Petruska v. Gannon University (3rd Cir 05/24/2006) (2-1):
We adopt a carefully tailored version of the ministerial exception. Where otherwise illegal discrimination is based on religious belief, religious doctrine, or the internal regulations of a church, the First Amendment exempts religious institutions from Title VII. In such cases, restricting a church’s freedom to select its ministers would violate the Free Exercise Clause by inhibiting the church’s ability to express its beliefs and put them into practice. Furthermore, questions about religious matters would pervade litigation, entangling courts in ecclesiastical matters and violating the Establishment Clause.
But where a church discriminates for reasons unrelated to religion, we hold that the Constitution does not foreclose Title VII suits. Employment discrimination unconnected to religious belief, religious doctrine, or the internal regulations of a church is simply the exercise of intolerance, not the free exercise of religion that the Constitution protects. Furthermore, in adjudicating suits that do not involve religious rationales for employment action, courts need not consider questions of religious belief, religious doctrine, or internal church regulation, a process that would violate the Establishment Clause by entangling courts in religious affairs.
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Appearance of bias at the NLRB
June 10, 2006 by Ross Runkel at LawMemo
In nine cases the NLRB has exposed an ALJ's practice of writing decisions by copying from briefs filed by the General Counsel. Last week seven got sent back for re-assignment to a different ALJ.
An utter waste of time and money for the Board, the parties, the other ALJs, and the taxpayers.
In NLRB cases, trials are held in front of administrative law judges - ALJs. High standards of competence and integrity are crucial.
For the latest seven cases, see NLRB Law Memo 06/09/2006.
For an excellent discussion of these developments, see Workplace Prof Blog - An ALJ Who Really Needs a Good Clerk, written by Professor Jeff Hirsch.
Jeffrey M. Hirsch, Associate Professor of Law, University of Tennessee College of Law. Professor Hirsch joined the UT law faculty in August 2004 after working for four years in the Appellate Court Branch of the National Labor Relations Board in Washington, D.C. He received a J.D. degree from New York University in 1998 and, following graduation, was a judicial clerk for the Honorable Haldane R. Mayer on the U.S. Court of Appeals for the Federal Circuit and the Honorable Robert R. Beezer on the U.S. Court of Appeals for the Ninth Circuit. While in law school, Professor Hirsch received the ABA/BNA Prize for excellence in labor and employment law and the Seymour M. Goldstein Prize for academic excellence in labor relations. His scholarly work has been published in the Seton Hall Law Review, the Fordham Law Review, and the New York University Environmental Law Journal.
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Supreme Court picks its own issues
June 08, 2006 by Ross Runkel at LawMemo
Did you notice that the US Supreme Court decided two employment law cases on Monday by making them turn on an issue that the litigants did not present to the Court?
Whitman v. Department of Transportation (US Supreme Court 06/05/2006):
The litigants thought the issue was whether the Civil Service Reform Act confers federal court jurisdiction. That was the issue decided by the 9th Circuit, and that's what the parties briefed and argued. After the arguments, the Court ordered the parties to file supplemental briefs. When the case was decided, the Court said that everybody got the issue backwards (my term). The question was not whether the Civil Service Reform Act confers jurisdiction, but whether it removes the jurisdiction granted by 28 USC Section 1331.
Further, the Court indicated that this issue depended in part on whether the employee's allegations state a "prohibited personnel practice." Although both parties had already agreed that it did, the Court said it would not allow the parties to agree to jurisdiction, so that issue now has to be resolved afresh.
Mohawk Industries v. Williams (US Supreme Court 06/05/2006):
The litigants focused on whether a corporation could be an "association-in-fact" for purposes of civil RICO. I should make clear that Williams' attorney complained to the Supreme Court that this issue had not been raised properly, so I was not surprised that the Court dismissed the writ of certiorari "as improvidently granted."
The surprise was that the Court then remanded the case for reconsideration in light of Anza v. Ideal Steel Supply Corp (US Supreme Court 06/05/2006). That was a surprise because Anza raised the question of whether the defendant's substantive statutory violation was the proximate cause of the plaintiff's injury. Proximate cause wasn't briefed at all by the parties in the Mohawk case.
How to explain this?
My theory is that the Court is searching for ways to decide cases in such a way as to maximize the probability of getting a unanimous or near-unanimous vote.
I applaud the Court for its goal. After all, the Court issued a unanimous opinion in an abortion case in January. Ayotte v. Planned Parenthood (US Supreme Court 01/18/2006).
I thought the Court was right on the money in Whitman, because the litigants lost sight of how the basic jurisdiction statute works.
I thought the Court acted in a bizarre manner in Mohawk when it sent the case back to decide an issue that wasn't even on the horizon.
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EEOC hits FedEx with broad subpoena
June 07, 2006 by Ross Runkel at LawMemo
EEOC is investigating FedEx on charges of a pattern and practice of discriminating against African-Americans and Latinos in promotion.
FedEx refused to comply with an administrative subpoena, and EEOC has gone to court to enforce the subpoena. Details in the EEOC press release - EEOC Investigating FedEx on Charges of Companywide Race, National Origin Discrimination.
The claim against FedEx is that it uses a cognitive ability test known as a Basic Skills Test for promotion from the entry-level position of handler to positions of customer service agent, ramp transporter driver, or courier.
The claim is that this test has an adverse impact on African-Americans and Latinos, and discriminates against them in violation of Title VII.
Claims like this require complex statistical evidence, much of which must come from the employer's own records. See Disparate impact #20 from Employment Law 101.
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$48.9 Million In EEOC-Verizon Pregnancy Bias Settlement
June 07, 2006 by Ross Runkel at LawMemo
12,326 women will share in a $48,900,000 settlement between EEOC and Verizon Communications.
Sounds big. It comes to less than $4,000 per individual.
This followed lawsuits filed by EEOC against two of Verizon's predecessors: NYNEX and Bell Atlantic.
The suits alleged that the companies violated Title VII of the 1964 Civil Rights Act, the Pregnancy Discrimination Act of 1978, the Equal Pay Act of 1963, and the Civil Rights Act of 1991, by denying female employees service credit related to pregnancy and maternity leaves of absence taken between July 2, 1965 and April 28, 1979, and care for newborn children leaves of absence taken between July 2, 1965 and December 31, 1983.
EEOC's press release: Class Of Women To Receive $48.9 Million In EEOC-Verizon Pregnancy Bias Settlement.
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Mohawk Industries v. Williams - Wow, what happened?
June 05, 2006 by Ross Runkel at LawMemo
In US Supreme Court arguments in April, the big issue was whether a corporation (Mohawk, the employer) could be part of a RICO "enterprise" known as an association-in-fact enterprise.
Today the Court announced that it would not decide that question. Mohawk Industries v. Williams (US Supreme Court 06/05/2006).
Instead, the Court sent the case back to the 11th Circuit for reconsideration in light of Anza v. Ideal Steel Supply Corp (US Supreme Court 06/05/2006).
In the Mohawk case, Williams and other hourly employees alleged that their employer's violation of the immigration laws allowed the employer to depress wages for its legal hourly employees, in violation of the federal RICO statute.
In the Anza case, the Supreme Court held that a RICO plaintiff alleging mail fraud must prove that the alleged violation was the proximate cause of the plaintiff's injury, which requires "some direct relation between the injury asserted and the injurious conduct alleged."
Ideal Steel Supply Corp and National Steel Supply were competitors. Ideal claimed that National failed to charge sales tax to cash-paying customers and filed false tax returns by mail, creating a chain of events that caused a decrease in Ideal's business and market share. The Supreme Court held that a RICO plaintiff alleging mail fraud must prove that the alleged violation was the proximate cause of the plaintiff's injury, which requires "some direct relation between the injury asserted and the injurious conduct alleged."
If the Anza case is applied to the facts of the Mohawk case, it would seem that plaintiffs have to prove that Mohawk's alleged violation of the immigration laws was the proximate cause of a reduction in wages for Mohawk's employees.
OK, that's fine, because the RICO statute clearly requires that.
What I fail to understand is why the Supreme Court remanded on that specific issue, when the arguments (both oral arguments and in briefs) did not deal with it.
I think I see why the Court did not want to decide the issue of whether a corporation can be part of an "association-in-fact" enterprise. After all, it wasn't argued in the 11th Circuit, and was virtually conceded in the trial court. The Supreme Court doesn't like to spend its time resolving such issues.
OK, lawyers, dust off your "proximate cause" notes from law school.
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EEOC v. Alamo - Can't fire Muslim for wearing scarf
June 03, 2006 by Ross Runkel at LawMemo
Alamo Car Rental fired a Muslim employee for refusing to take off her head scarf during the holy month of Ramadan.
Guess what? That violated Title VII, which requires that an employer provide a reasonable accommodation for an employee's religious practices.
- The case: EEOC v Alamo Rent-A-Car (D. Ariz. 05/26/2006)
- EEOC press release describing the case: Alamo Car Rental Guilty of Religious Bias Federal Court Rules in EEOC Lawsuit
EEOC described the case this way:
Prior to being fired, charging party Bilan Nur had worked for Alamo since 1999. EEOC’s lawsuit asserted that the company had permitted her to wear a head covering for religious reasons during Ramadan in 1999 and 2000. However, following the tragic events of September 11, 2001, Alamo refused to permit Ms. Nur to observe this particular religious belief during December of 2001.
Alamo claimed that it told Ms. Nur that the company dress code prohibited wearing of a scarf. Notwithstanding Alamo’s representation, the EEOC found that the company had no such policy. When Ms. Nur refused to remove the religious garment, Alamo disciplined, suspended and terminated her employment following consultation with regional level human resources officials and in-house counsel.
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Herrera today, gone tomorrow
June 02, 2006 by Ross Runkel at LawMemo
Strange. The 10th Circuit filed an opinion on Tuesday and withdrew it on Wednesday.
The order:
The opinion entered in this matter on May 30, 2006, is withdrawn. The appeal shall be restored to pending status.
The case: Herrera v. Lufkin Industries (10th Cir 05/30/2006, 05/31/2006).
Findlaw has dutifully scrubbed the original opinion off its web site. We've captured the original 05/30/2006 opinion.
I thought the case was pretty ordinary. Some racist comments which the court thought were not pervasive or serious enough to create a legally actionable offensive work environment.
Employment Law Memo provided this summary:
Herrera sued the employer, asserting claims for (among other things) hostile environment race-based harassment under Title VII, breach of contract, and intentional infliction of emotional distress (IIED). The trial court granted summary judgment in favor of the employer on the first two claims, and judgment as a matter of law in favor of the employer on the third. The 10th Circuit affirmed, concluding that 1) the alleged conduct was not sufficiently "severe or pervasive" to constitute actionable harassment under Title VII; 2) Herrera's employee handbook didn't constitute a contract, and Herrera wasn't constructively discharged even if there had been a contract; and 3) the conduct underlying Herrera's IIED claim was not sufficiently extreme and outrageous to support that claim.
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ERISA, bigamy, and choice of laws
June 01, 2006 by Ross Runkel at LawMemo
What if the beneficiary of an ERISA plan dies leaving two spouses? Who gets the loot?
It can depend on which state's law applies.
In DaimlerChrysler Corp v. Durden (6th Cir 05/26/2006) an ERISA pension plan beneficiary died, leaving two spouses, and the plan sued for a declaration of who was the "surviving spouse" under the plan.
| Employment Law Memo notified its readers about this case on 05/31/2006. |
- The plan document provided that Michigan law should apply.
- The 6th Circuit held that Ohio law should apply.
The court applied the Restatement (2nd) of Conflicts of Laws, and found that
- Ohio had the most significant relationships to both marriages, both spouses, and the decedent
- Applying Michigan law (which presumes the validity of the second marriage) would be contrary to a fundamental policy of Ohio law (which presumes the continuation of the first marriage
- Michigan has no interest in which marriage is declared valid
The DISSENT would apply Michigan law because that was the decision of the parties and would result in greater uniformity, simplicity, clarity, and efficiency.
More comments on this case:
The ERISA Blog - SIXTH CIRCUIT DISREGARDS CHOICE OF LAW PROVISION IN PENSION PLAN TO DECIDE SURVIVING SPOUSE ISSUE
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Editor: Ross Runkel, Professor of Law Emeritus. email Ross@LawMemo.Com, Phone 503-399-8028. Copyright LawMemo, Inc.
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