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Effective immediately, FMLA covers care for member of armed forces
January 30, 2008 by Ross Runkel at LawMemo

Amendments to the Family and Medical Leave Act of 1993 (FMLA) are effective on January 28, 2008.

The National Defense Authorization Act for FY 2008 (NDAA) was signed by the President January 28. Section 585 amends the FMLA to permit a "spouse, son, daughter, parent, or next of kin" to take up to 26 workweeks of leave to care for a

"member of the Armed Forces, including a member of the National Guard or Reserves, who is undergoing medical treatment, recuperation, or therapy, is otherwise in outpatient status, or is otherwise on the temporary disability retired list, for a serious injury or illness."

The NDAA also permits an employee to take FMLA leave for "any qualifying exigency (as the Secretary [of Labor] shall, by regulation, determine) arising out of the fact that the spouse, or a son, daughter, or parent of the employee is on active duty (or has been notified of an impending call or order to active duty) in the Armed Forces in support of a contingency operation." By its express terms, this provision of the NDAA is not effective until the Secretary of Labor issues final regulations defining "any qualifying exigency."

DOL web site, including link to full text: http://www.dol.gov/esa/whd/fmla/NDAA_fmla.htm



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Three nominees to NLRB
January 27, 2008 by Ross Runkel at LawMemo

President Bush has announced his intention to nominate three lawyers to the NLRB, which now is limping along with only two Members. [White House Announcement]

Thanks to Michael Fox for tipping me off on this. His reaction/prediction is here: NLRB Back to Full Strength? By No Means a Sure Thing

The nominees:

  1. Robert J. Battista (Republican), whose previous term expired December 16.

  2. Dennis P. Walsh (Democrat), whose previous term expired December 31.

  3. Gerard Morales (Republican), a partner in the Snell & Wilmer law firm.

The following biographical information is from the Snell & Wilmer web site:

Gerard Morales

Partner

Labor/Employment/Construction Law - Representation in employment related matters, including wrongful termination, employment discrimination, arbitration and other alternative dispute resolution proceedings. Extensive experience in NLRB unfair labor practice trials, and union elections matters, collective bargaining, labor law issues affecting the construction industry, the Hispanic labor force and cross boarder employment, wage and hour compliance, corporate policy development, and administrative proceedings before state and federal regulatory agencies, including the Equal Employment Opportunity Commission, U.S. Department of Labor, and National Labor Relations Board.

Employee Benefits Law - Representation with respect to collectively-bargained employee benefit funds.

International - Representation of U.S. companies in negotiating lease and distribution agreements, joint ventures and other arrangements in Mexico.

Recognitions & Awards

Named Southwest Super Lawyer by Law & Politics Magazine (2007)
Chambers USA, America's Leading Lawyers for Businesses, The Client's Guide (2005)
The International Who's Who of Management, Labour & Employment Lawyers (2006)

Personal

Born La Habana, Cuba

Memberships & Activities

Chairman (2005), Associated General Contractors, Labor and Employment Law Council
Lex Mundi, Labor and Employment Law Committee
American Bar Association, Labor and Employment Law Sections
Hispanic National Bar Association, Region VI past president
AAA Panel of Arbitrators, Member
National Law Center for Inter-American Free Trade, Board Member
ALI-ABA Labor Law of NAFTA program, Chair
ALI-ABA Faculty Employee Benefits Course
ALI-ABA Labor Employment Advisory Panel

Other Professional Experience

Field Attorney with the National Labor Relations Board

Presentations & Publications

• Adjunct Professor, University of Arizona College of Law (2001-2002)

• Field Attorney, National Labor Relations Board

• Labor Law Enforcement in Mexico, co-author, National Law Center for Inter-American Free Trade

• Frequent speaker and contributor of articles on employment-related topics

• Contributing author of Employee Benefits Law, ABA Section of Labor and Employment Law

• How to Take a Case before the NLRB, Chapter Editor, ABA Section of Labor and Employment Law

• Associated General Contractors Labor and Employment Law Symposiums, presenter ABA Labor Section Committee on Practice and Procedure ALI-ABA Labor and Employee Benefits Courses of Study, Lecturer

Community Involvement

National Law Center for Inter-American Free Trade, Board of Directors
ALI - ABA Faculty

Education

Tulane University (M.B.A. and J.D.)
Stetson University (B.A., Political Science/Economics)

Court Admissions

United States Supreme Court
Supreme Courts of Arizona, Louisiana, Nevada, Texas, and the District of Columbia
United States Court of International Trade

Languages Spoken

Spanish



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Mike Maslanka: Dealing With Dysfunctional Counsel
January 26, 2008 by Ross Runkel at LawMemo

You've been there. The lawyer on the other side takes no prisoners, runs to the courthouse whenever their hair gets mussed up, and otherwise engages in grandstanding, hyperbole, and other unprofessional conduct they must have picked up from bad TV shows.

What to do?

Michael P. Maslanka has written Dealing With Dysfunctional Counsel, which has some answers. We reproduce it here from the January edition of In-House Texas.

The article is written for general counsel.

Mike suggests that GC use their positions as bully pulpits to urge judges to be judges.

He also has some cute advice that he derives from two of my favorites: Muhammad Ali and Buddha.

Michael P. Maslanka is an employment law expert who manages Ford & Harrison's Dallas, Texas office, and is an all-around nice guy.



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Whistleblower was offered $5,000, recovered $3,000,000
January 26, 2008 by Ross Runkel at LawMemo

According to the lawyer for Nancy Olipares, the employer's lawyer offered no more than $5,000 to settle her whistleblower claim. Olipares' lawyer had offered to settle for $75,000.

A jury said it was worth more than $3,000,000.

Source: Honolulu jury awards $3M to city ex-official, in The Honolulu Advertiser.

I heard about this from Michael Fox, of course. He has a thing for million dollar verdicts. MDV in the Aloha State from Jottings By An Employer's Lawyer.



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Sarbanes-Oxley: An explanation from the 5th Circuit
January 25, 2008 by Ross Runkel at LawMemo

Allen v. Administrative Review Board (5th Cir 01/22/2008) is a must-read case for anyone involved with Sarbanes-Oxley whistleblower cases.

Allen filed a complaint with the Department of Labor against the employer, asserting a whistleblower claim under the Sarbanes-Oxley Act. An administrative law judge dismissed the complaint. The Administrative Review Board (ARB) affirmed that decision, which became the final order of the Secretary of Labor. The 5th Circuit affirmed.

The Act prohibits a publicly traded company from retaliating against an employee who reports information to a supervisor "regarding any conduct which the employee reasonably believes constitutes a violation" relating to one of six enumerated categories.

The court concluded that "an employee's reasonable belief must be scrutinized under both a subjective and objective standard." The court noted "[t]he 'objective reasonableness' standard applicable to [Sarbanes-Oxley Act] whistleblower claims is similar to the 'objective reasonableness' standard applicable to Title VII retaliation claims." The court also noted, however, "[w]e have previously declined to address whether the 'reasonable belief' element of a Title VII retaliation claim includes both a subjective and objective component."

The court determined ultimately that Allen did not act based on a reasonable belief and hence did not engage in protected activity under the Act.

For two good comments on this case, see:




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4th Birthday
January 24, 2008 by Ross Runkel at LawMemo

Happy 4th Birthday to us.


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Medical marijuana law gives no protection from the boss
January 24, 2008 by Ross Runkel at LawMemo

Gary Ross got fired because his drug test was positive for marijuana. He was using marijuana to treat chronic back pain, doing so on the advice of his doctor.

Ross sued his former employer claiming disability discrimination and claiming wrongful discharge in violation of public policy.

He relied on California's Compassionate Use Act of 1996, which gives an individual some protections from criminal prosecution when using marijuana for medical purposes on the recommendation of a physician.

Only one problem, according to the California Supreme Court. The Compassionate Use Act was not designed to have any impact on employment law. The whole idea of the statute was to protect certain users from criminal prosecution. So Ross lost, and the boss won.

The case: Ross v. Ragingwire Telecommunications (California Supreme Court 01/24/2008).

Early blog comments:

California Supreme Court: No Accommodation for Medical Marijuana from What's New in Employment Law?

CA Supreme Court: Ragingwire affirmed from Storm's California Employment Law.



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Supreme Court takes three employment law cases
January 19, 2008 by Ross Runkel at LawMemo

US Supreme Court granted certiorari in three employment law cases on January 18, 2008)

Retaliation: Is cooperating with internal investigation protected activity?

Crawford v. Metropolitan Government of Nashville
Details, briefs: http://www.lawmemo.com/supreme/case/Crawford/

Crawford claimed she was discharged because she cooperated in her employer's investigation of sexual harassment complaints against another employee. No EEOC charge had been filed prior to the investigation. Title VII Section 704(a) protects an employee from retaliation because the employee "has opposed" an unlawful employment practice or "participated in any manner in an investigation ... under this chapter." The 6th Circuit held that Crawford was not protected by either the "opposition" clause or the "participation" clause. Her petition for certiorari presents the following question: "Does the anti-retaliation provision of section 704(a) of Title VII of the 1964 Civil Rights Act protect a worker from being dismissed because she cooperated with her employer's internal investigation of sexual harassment?"

ADEA: Burden of persuasion in establishing "reasonable factors other than age."

Meacham v. Knolls Atomic Power Laboratory
Details, briefs: http://www.lawmemo.com/supreme/case/Meacham/

The Age Discrimination in Employment Act (ADEA) prohibits employment practices that have an unjustified disparate impact on older workers, Smith v. City of Jackson, Miss., 544 U.S. 228 (2005), but also provides that it "shall not be unlawful for an employer . . . to take any action otherwise prohibited . . . where the differentiation is based on reasonable factors other than age." The question presented in the petition for certiorari is: "Whether an employee alleging disparate impact under the ADEA bears the burden of persuasion on the "reasonable factors other than age" defense, as held by the Second Circuit in this case in conflict with the decisions of other circuits and a regulation of the Equal Employment Opportunity Commission."

ERISA: Judicial review when administrator both decides claims and pays claims.

MetLife v. Glenn
Details, briefs: http://www.lawmemo.com/supreme/case/MetLife/

The Supreme Court will decide two issues: (1) Whether the Sixth Circuit erred in holding, in conflict with two other Circuits, that the fact that a claim administrator of an ERISA plan also funds the plan benefits, without more, constitutes a "conflict of interest" which must be weighed in a judicial review of the administrator's benefit determination under Firestone Tire & Rubber v. Bruch, 489 U.S. 101 (1989)? (2) If an administrator that both determines and pays claims under an ERISA plan is deemed to be operating under a conflict of interest, how should that conflict be taken into account on judicial review of a discretionary benefit determination?"



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ADA accommodation case taken off Supreme Court docket
January 15, 2008 by Ross Runkel at LawMemo

Huber v. Wal-Mart Stores, Inc. has been settled by the parties, and removed from the list of cases that the Supreme Court will decide this year.

It raised an interesting issue: Whether the ADA requires an employer to reassign a disabled employee to a vacant position for which she is qualified, or merely permits the employee to apply and compete with other applicants for the vacant position.

Here is how the issue was stated in Huber's petition for certiorari:

Title I of the Americans with Disabilities Act of 1990, 42 U.S.C. § 12111 et seq. (ADA), requires employers to "mak[e] reasonable accommodations to the known physical or mental limitations of an otherwise qualified individual with a disability." 42 U.S.C. § 12112(b)(5)(A). The statute expressly lists "reassignment to a vacant position" as a "reasonable accommodation." Id. § 12111(9)(B). The Equal Employment Opportunity Commission (EEOC) has issued regulations implementing that definition, 29 C.F.R. § 1630.2(o)(2)(ii), and it has interpreted those regulations to provide that "[t]he employee does not need to be the best qualified individual for the position in order to obtain it as a reassignment." The questions presented are:

1. If a disability prevents an employee from performing the essential functions of his or her current position, does the ADA require:

(a) that the employer reassign the employee to a vacant, equivalent position for which he or she is qualified, as the Tenth and District of Columbia Circuits have held; or

(b) that the employer merely permit the employee to apply and compete with other applicants for the vacant, equivalent position for which he or she is qualified, as the Seventh and Eighth Circuits have held?

The facts:

Pam Huber had worked as an order-filler until she became disabled. She sought, as a reasonable accommodation, reassignment to a router position which was vacant and for which she was qualified. The employer did not automatically reassign her to the router position, but required her to apply and compete with other applicants. The employer filled the router position with a non-disabled person who was the most qualified applicant, and placed Huber in a less desirable janitorial position.

Huber sued under the Americans with Disabilities Act (ADA); the trial court granted summary judgment for Huber; the 8th Circuit reversed; the US Supreme Court granted certiorari to review the 8th Circuit judgment. Now the case has been dismissed.

Huber's position was that the employer should have automatically reassigned her to the router position without requiring her to compete with other applicants. The employer's position was that it has a nondiscriminatory policy of hiring the most qualified applicant, and that giving the router position to the most qualified applicant does not violate the ADA.



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Supreme Court takes "class of one" case
January 11, 2008 by Ross Runkel at LawMemo

This morning the US Supreme Court announced that it will decide whether, in the context of employment, there can be a "class of one" under the equal protection clause.

Engquist v. Oregon Dept of Agriculture [Details]

The ("liberal") 9th Circuit rejected a legal theory that many other circuits have adopted. It's the class-of-one idea that you can win an equal protection case even though you're not claiming to be in a multi-member class such as is involved in race and sex discrimination.

Enquist was laid off from her state job. She sued her public employer under several theories and won a jury verdict based on two constitutional theories and on intentional interference with contract. The 9th Circuit reversed on the equal protection claim.

Equal protection for a class of one? 9th Circuit said "No."
Engquist v. Oregon Dept of Agriculture (9th Cir 02/08/2007) (2-1 vote).

The jury found liability under the equal protection clause because the defendants "intentionally treat[ed] the plaintiff differently than others similarly situated with respect to the denial of her promotion, termination of her employment, or denial of bumping rights without any rational basis and solely for arbitrary, vindictive, or malicious reasons." This was done on a theory that Engquist was a "class of one."

The 9th Circuit held, as a matter of first impression, that a class-of-one theory is not applicable to public employees. Following Village of Willowbrook v. Olech, 528 US 562 (2000), the 9th Circuit has applied the class of one theory to regulatory land use cases, and other Circuits have applied it to public employment decisions.

The court concluded that the rights of public employees are not as broad as the rights of ordinary citizens, the need for review under equal protection analysis is "thin" due to other legal protections enjoyed by public employees, and "prohibiting arbitrary public employer actions would also upset long-standing personnel practices."

Looks like the expedited briefing schedule imposed by the Supreme Court will give them time to hear oral arguments in April, and decide the case before the summer recess.



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9th Circuit grants stay of injunction against San Francisco Health Care Security Ordinance
January 09, 2008 by Ross Runkel at LawMemo

Golden Gate Restaurant Assoc v. San Francisco (9th Cir 01/09/2008)
Trial court opinion: http://www.lawmemo.com/docs/ca-nd/GoldenGate_order.pdf

The 9th Circuit issued a 34 page decision staying an injunction that had been entered by a district court. The effect of the stay is to allow San Francisco to implement its Health Care Security Ordinance pending appeal of the district court's order. The lower court had concluded that the Ordinance is preempted by the Employee Retirement Income Security Act (ERISA).

The Ordinance's effective date is January 1, 2008. It requires private employers with 20 or more employees to make heath care expenditures of specific amounts per hour of work. The Ordinance sets out a number of non-exclusive qualifying health care expenditures, such as contributions to health savings accounts, direct reimbursement to employees for some of the expenses incurred in the purchase of health care services, payments to third parties for the purpose of provided health care services, costs incurred in the direct delivery of health care services, or payments by the employer to the City “to be used on behalf of covered employees.”

United States District Court for the Northern District of California held that the Ordinance is preempted by ERISA because it (1) it has an impermissible connection with employee benefit plans and (2) its expenditure requirements make unlawful reference to employee benefit plans.

The 9th Circuit gave three primary reasons for allowing San Francisco to enforce the Ordinance during the appeals process: (1) The City showed not only a probability of success on the merits, but also a "strong likelihood of success on the merits." (2) "The balance of hardships tips sharply in favor of the City." (3) "The public interest is served by granting a stay."

My view: The 9th Circuit is correct. It's not a question of whether the Ordinance is a wise one. It's a question of whether ERISA strips local governments of their ordinary powers. Employers who have ERISA plans can comply with the Ordinance without making any changes to their ERISA plans.

Other bloggers have their say:




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Age discrimination, retirement plans, and the Supreme Court
January 09, 2008 by Ross Runkel at LawMemo

Today the US Supreme Court hear oral arguments in Kentucky Retirement Systems v. EEOC [Click here for briefs, link to transcript, etc.].

EEOC sued claiming that a disability-retirement-benefits plan for state and county employees violates the Age Discrimination in Employment Act (ADEA). The trial court granted summary judgment for defendants on the ground that EEOC did not establish a prima facie case; the 6th Circuit, en banc 10-4, reversed.

The KRS disability-retirement-benefits plan disqualifies employees who are still working from receiving disability-retirement benefits if they have already reached normal retirement-benefit age at the time they become disabled. The plan also calculates disability retirement benefits in such a way that an older employee who is eligible to receive disability benefits receives fewer benefits - in the form of lower monthly benefit payments - than a younger disabled employee receiving disability-retirement benefits who is similar to the older disabled employee in every relevant factor other than age.

The 6th Circuit held that (1) EEOC established a prima facie case because the plan is facially discriminatory on the basis of age and (2) when a plan is facially discriminatory a plaintiff does not need additional proof of discriminatory animus to establish a prima facie claim of disparate treatment.

The US Supreme Court granted certiorari to review the 6th Circuit's judgment.

If you want to see what Paul Secunda at Workplace Prof Blog gleaned from the transcript of the Supreme Court argument, go to Oral Argument Transcript Analysis of Kentucky Retirement Systems v. EEOC.

My view: Extremely difficult to predict the outcome, but three things make me tilt toward the EEOC's position:

  1. Kentucky is relying to some extent on an argument that their plan is not "arbitrary." OK, fine. The problem with that argument is that the word "arbitrary" does not appear in the portion of the statute that EEOC relies on, so it's not really relevant whether the plan is arbitrary or not. "Arbitrary" appears in the preamble only.
  2. The plan expressly uses age as a criterion. Where I come from, that makes the plan facially discriminatory on the basis of age. Any counterargument to that is really going to have to make mincemeat out of the English language.
  3. All EEOC is trying to do is establish a prima facie case. If EEOC wins on that one issue, Kentucky still has the opportunity to defend its plan based on defenses that the statute allows.




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Bush's NLRB Legacy: #5 of 12
January 09, 2008 by Ross Runkel at LawMemo

Card-based recognitions must allow 45 day window for rival petitions. #5 in a series of 12 significant actions by the Bush Board.

Dana Corporation, 351 NLRB No. 28 (September 29, 2007) (3-2)

When a majority (more than half) of employees have signed cards authorizing a union to represent them, an employer has the option of either (a) recognizing the union based on the cards or (b) requiring that there be an NLRB-conducted secret ballot election. In this case, the employer voluntarily recognized the union.

The issue for the NLRB was how to set up a "recognition bar" that would bar any election proceedings for a reasonable period of time to allow the union and the employer time to negotiate a contract.

In Dana Corporation, the NLRB modified the recognition bar rules for card-based recognitions, whether or not the voluntary recognition is pursuant to a neutrality or card-check agreement. Board's modified recognition bar:

"No election bar will be imposed after a card-based recognition unless (1) employees in the bargaining unit receive notice of the recognition and of their right, within 45 days of the notice, to file a decertification petition or to support the filing of a petition by a rival union, and (2) 45 days pass from the date of notice without the filing of a valid petition. If a valid petition supported by 30 percent or more of the unit employees is filed within 45 days of the notice, the petition will be processed."

My view:

There are two "normal" ways for a union to become recognized: winning a secret ballot election, and being recognized voluntarily based on recognition cards. Board Members have for a long time disagreed about the extent to which each method actually furthers the statutory goal of "employee free choice."

The new rule in Dana Corp continues to allow card-based recognition, and continues to allow for a recognition bar, while also allowing a brief period of time during which there can be a challenge as to whether there really is majority support for the union.

The new rule is opposed by unions that do not want to go through a period of election campaigns, and who believe that recognition cards are trustworthy. The new rule is supported by employers who believe that recognition cards often are signed under pressure or by employees who haven't been exposed to any counter-arguments.




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Bush's NLRB Legacy: #4 of 12
January 07, 2008 by Ross Runkel at LawMemo

Employee misconduct discovered through employer's unlawful conduct. #4 in a series of 12 significant actions by the Bush Board.

Anheuser-Busch, Inc., 351 NLRB No. 40 (September 29, 2007).

The Board reaffirmed its 2004 holding that the NLRA prohibits the Board from granting a make-whole remedy to employees disciplined or discharged for misconduct discovered as a result of unlawful conduct by their employer.

The employer uncovered evidence that employees were engaging in misconduct, including possible use of illegal drugs, in informal break areas on the roof of a building, so the employer installed a hidden surveillance camera on the roof and another camera inside an elevator motor room. The use of hidden surveillance cameras was a change in the employer's operations, and the employer did not notify the Union of its decision to install the cameras.

The cameras observed 16 employees engaging in misconduct. After discontinuing the surveillance, the employer notified the Union that it had been using the cameras. The Union protested the failure to provide notice and an opportunity to bargain over the installation of the cameras.

The employer interviewed each of the 16 employees. Before each interview, the Union advised the employee that the Respondent had videotaped the employee’s conduct; each employee then admitted engaging in the observed misconduct.

The employer discharged 5 of the 16 employees. Each of the discharged employees had violated the Respondent’s rules by using illegal drugs (marijuana) at work. The employer suspended the remaining 11 employees, and issued “last chance” agreements to 7 of them. All of the suspended employees had violated Respondent’s rules by entering a restricted area and by being away from an assigned work location for an extended time period. Some of the suspended employees had also violated the Respondent’s rules by sleeping on duty or by urinating on the roof.

The Board found that the employer violated Section 8(a)(5) by failing to give the Union notice and an opportunity to bargain before installing the hidden surveillance cameras.

The Board rejected the argument that the employees, who were disciplined based solely on the employer's unquestionably unlawful use of hidden surveillance cameras, are entitled to make-whole relief (reinstatement and back pay).

The NLRB majority relied primarily on Section 10(c), which provides:

"No order of the Board shall require the reinstatement of any individual as an employee who has been suspended or discharged, or the payment to him of any back pay, if such individual was suspended or discharged for cause."

My view: This decision carries forward earlier decisions in which the NLRB found liability and granted a remedy for unlawful employer conduct, but refused to overturn discipline when the evidence against the employee was derived from that unlawful conduct. The decision is, however, an extension of the earlier cases.



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Bush's NLRB Legacy: #3 of 12
January 04, 2008 by Ross Runkel at LawMemo

At-will strike replacements are "permanent" replacements.

#3 in a series of 12 significant actions by the Bush Board.

Jones Plastic & Engineering Co., 351 NLRB No. 11 (September 27, 2007) (3-2).

It has long been the rule that when there is an economic strike (as opposed to an "unfair labor practice strike") the striking employees have a right to get their jobs back at the end of the strike unless the employer has hired "permanent replacements."

In Jones Plastic there was an economic strike, and the employer hired replacements who signed the following form:

I [name of replacement] hereby accept employment with Jones Plastic & Engineering Company, LLC, Camden division (hereafter “Jones Plastic”) as a permanent replacement for [name of striker] who is presently on strike against Jones Plastic. I understand that my employment with Jones Plastic may be terminated by myself or by Jones Plastic at any time, with or without cause. I further understand that my employment may be terminated as a result of a strike settlement agreement reached between Jones Plastic and the U.S.W.A. Local Union 224 or by order of the National Labor Relations Board.

The NLRB held that these replacements were "permanent" replacements, meaning that they displaced the striking employees.

The Board announced that at-will employment status does not detract from an employer's otherwise valid showing that it has permanently replaced striking employees. The Board overruled Target Rock, 324 NLRB 373, 374 (1997), enfd. 172 F.3d 921 (D.C. Cir. 1998), to the extent it is inconsistent with that principle.

My view:

The Board did not change the basic rule that an economic striker loses the right to reinstatement if he or she is permanently replaced.

The issue was whether a replacement who is hired "at-will" (meaning that the replacement was not guaranteed continued employment and could be fired for any reason) should be categorized as "permanent." The majority of the Board concluded that an at-will replacement in fact displaces a striking employee.

It appears that the majority is drawing a line between "permanent" as opposed to "temporary." Thus, if replacements are told that they have a job only so long as the strike continues, they are not permanent and the strikers will get their jobs back.



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Punitive damages without an award of compensatory damages.
January 03, 2008 by Ross Runkel at LawMemo

Abner v. The Kansas City So RR (5th Cir 01/02/2008)

Eight African American employees sued claiming a work environment hostile to race, in violation of Title VII and 42 USC 1981. A jury returned a verdict finding the employer liable, awarded no compensatory damages, and awarded $125,000 in punitive damages. The 5th Circuit affirmed.

The evidence, which extended over a ten year period, indicated that the employees were subjected to racial graffiti, a noose hanging outside a door, racially derogatory comments, and discriminatory assignments. The jury found that supervisors caused and/or failed to properly respond to this racially derogatory behavior.

(1) The court held that a punitive damages award under Title VII and Section 1981 need not be accompanied by compensatory damages. This was based on the "plain language" of the statute, the legislative history, and the purpose of punitive damages. Any concern about unbounded jury discretion is directly addressed by the statutory cap on punitive damages. Due to the statutory cap, it is not necessary for a trial court to award "ceremonial" nominal damages of $1 to each plaintiff.

(2) The court rejected the employer's argument that an award of punitive damages violates due process under the test in BMW of North America v. Gore, 517 US 559 (1996), saying that "the three-factor Gore analysis is relevant only if the statutory cap itself offends due process." As with cases in which punitive damages accompany nominal damages, "a ratio-based inquiry becomes irrelevant."

(3) The court held that it was proper to allow the plaintiffs to testify about conduct over a ten year period. National Railroad Passenger Corp v. Morgan, 536 US 101 (2002) said that if "an act contributing to the claim occurs within the filing period, the entire time period of the hostile environment may be considered." To the extent that there was testimony outside of the ten year period, it did not cause prejudicial error.



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Bush's NLRB Legacy: #2 of 12
January 03, 2008 by Ross Runkel at LawMemo

Employee use of employer's email: no-solicitation rules and a definition of "discrimination"

#2 in a series of 12 significant actions by the Bush Board.

The Guard Publishing Company, d/b/a The Register Guard, 351 NLRB No. 70 (December 16, 2007) (3-2).

The employer had a policy that prohibited employees from using the employer's email system for any "non-job-related solicitations." Employees used email regularly for work-related matters. Employees also used email to send and receive personal messages such as baby announcements, party invitations, and the occasional offer of sports tickets or request for services such as dog walking. However, there is no evidence that the employees used email to solicit support for or participation in any outside cause or organization other than the United Way, for which the employer conducted a periodic charitable campaign.

Holding (1):

An employer does not violate the National Labor Relations Act (NLRA) by maintaining a policy that prohibited employees from using the employer's email system for any "non-job-related solicitations."

This is consistent with previous holdings by the Board, saying that employers have a right to limit the use of employer-owned things such as bulletin boards, copy machines, telephones, and so on. An employer can limit the use of such things to business-related activities. For the majority, email is no more than the modern version of bulletin boards and copy machines.

Holding (2):

The employer did not unlawfully "discriminate" within the meaning of the National Labor Relations Act. The majority adopted the reasoning of the United States Court of Appeals for the Seventh Circuit, noting that in two cases involving the use of employer bulletin boards, the court had distinguished between personal nonwork-related postings such as for-sale notices and wedding announcements, on the one hand, and "group" or "organizational" postings such as union materials on the other. See Fleming Companies v. NLRB, 349 F.3d 968, 975 (7th Cir. 2003), denying enf. to 336 NLRB 192 (2001); and Guardian Industries Corp. v. NLRB, 49 F.3d 317, 319-320 (7th Cir. 1995), denying enf. to 313 NLRB 1275 (1994). The Board majority found that the court's analysis, "rather than existing Board precedent, better reflects the principle that discrimination means the unequal treatment of equals." The majority overruled the Board's decisions in Fleming, Guardian, and other similar cases to the extent they were inconsistent with its decision here.

My view:

The first holding (allowing a no-use rule) is consistent with previous holdings by the Board, saying that employers have a right to limit the use of employer-owned things such as bulletin boards, copy machines, telephones, and so on. An employer can limit the use of such things to business-related activities. For the majority, email is no more than the modern version of bulletin boards and copy machines.

The second holding (the definition of "discrimination") is a major new policy decision. The majority of the Board adopted a definition that has never been adopted by the Board in the past, and has been adopted by only one of the federal Circuit Courts. This will allow employers much greater flexibility to ban the use of email, (and phone, copy machine, bulletin board) for organizing purposes while allowing employees to use it for other non-business purposes.



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2.5 MILLION for harrassing one employee
January 03, 2008 by Ross Runkel at LawMemo

Here's the EEOC press release:

EEOC Says African American Electrician Subjected to ‘N-Word’ and Threats of Lynching at Worksites Across the Country

HONOLULU -- The U.S Equal Employment Opportunity Commission (EEOC) today announced a major settlement of a race discrimination and retaliation lawsuit against Lockheed Martin, the world’s largest military contractor, for $2,500,000 and other relief on behalf of an African American electrician who was subjected to a racially hostile work environment at several job sites nationwide – including threats of lynching and the “N-word.”

The monetary relief for former Lockheed employee Charles Daniels is the largest amount ever obtained by the EEOC for a single person in a race discrimination case, and one of the largest amounts recovered for an individual in any litigation settlement by the agency. Additionally, the Bethesda, Md.-based company agreed to terminate the harassers and make significant policy changes to address any future discrimination, the EEOC said at a press conference in Hawaii.

The EEOC’s suit, filed in August 2005, alleged that Daniels was subjected to severe racial harassment while working on military aircrafts as part of a field service team in Jacksonville, Fla., Whidbey Island, Wash., and Oah’u, Hawaii. The EEOC charged that Daniels was the target of persistent verbal abuse by coworkers and a supervisor whose racial slurs and offensive language included calling him the “N-word” and saying “we should do to blacks what Hitler did to the Jews” and “if the South had won then this would be a better country.” Daniels was also subjected to multiple physical threats, such as lynching and other death threats after he reported the harassment. Despite its legal obligations, Lockheed failed to discipline the harassers and instead allowed the discrimination against Daniels to continue unabated – even though the company was aware of the unlawful conduct.

Commenting on the settlement, Daniels said: “As an armed forces veteran who swore to defend the rights and interest of Americans around the globe, I find it sad that the U.S. government had to sue its largest defense contractor Lockheed Martin -- whose slogan is ‘We never forget who we’re working for’ -- to protect my rights here at home!”

Daniels added, “I am pleased that we stood up for justice, because it should help all hard-working Americans of every race and gender to know that we have rights and protections guaranteed under the laws of this nation.”

EEOC Regional Attorney William Tamayo said, “This is a very good resolution because Lockheed Martin agreed to terminate and permanently bar Daniel’s harassers from employment. It sends a powerful message that racism cannot and must not be tolerated.”

Raymond Cheung, the EEOC attorney who led the government’s litigation effort, added, “To combat the harassment and threats faced by Mr. Daniels is at the heart of why the EEOC was created. Despite concerns of retaliation, this man had the courage to stand up and make public what happened to him, in an effort to ensure that it would not happen to anyone else. It has been a once-in-a-lifetime honor to work on this case.”

The litigation and consent decree were filed by the EEOC under Title VII of the Civil Rights Act in the U.S. Court for the District of Hawaii (U.S. Equal Employment Opportunity Commission v. Lockheed Martin, CV-05-00479).

EEOC Honolulu Local Office Director Timothy Riera praised the agency’s lead investigator in the case, Gloria Gervacio, and said: “The overt harassment to which Mr. Daniels was subjected in Hawaii represents some of the most severe misconduct this office has come across. It is imperative that employers here take proactive measures to ensure that discrimination complaints are taken seriously and that all employees work in an environment free of harassment.”

Racial harassment charge filings with EEOC offices nationwide have more than doubled since the early 1990s from 3,075 in Fiscal Year 1991 to approximately 7,000 in FY 2007 (based on preliminary year-end data). Additionally, race remains the most frequently alleged basis of discrimination in charges brought to the EEOC, accounting for about 36% of the agency’s private sector caseload.

On Feb. 28, 2007, EEOC Chair Naomi C. Earp launched the Commission's E-RACE Initiative (Eradicating Racism And Colorism from Employment), a national outreach, education, and enforcement campaign focusing on new and emerging race and color issues in the 21st century workplace. Further information about the E-RACE Initiative is available on the EEOC’s web site at http://www.eeoc.gov/initiatives/e-race/index.html



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Bush's NLRB Legacy: #1 of 12
January 02, 2008 by Ross Runkel at LawMemo

Weingarten rights: non-union employees do not have them.

#1 in a series of 12 significant actions by the Bush Board.

IBM Corp., 341 NLRB No. 148 (06/09/2004) (3-2)

A " Weingarten right" is the right of an employee to have a union representative present when called in by the employer for an investigative interview, where the employer is investigating alleged wrongdoing by the employee.

This right was recognized by the Board and given approval by the US Supreme Court in the 1970's. Since then the Board has gone back and forth on the question of whether to extend similar rights to employees in the non-union sector.

In IBM Corp. the Board returned to the rule that Weingarten rights are available only for unionized employees.

My view:

As a matter of legal theory, the Weingarten principle has always rested on a thin reed. That thin reed originally was tied to the fact that the employee's request for the presence of a representative could be traced back to the original union organizational effort, and perhaps to the bargaining that resulted in a collective bargaining agreement. Therefore, this decision returns the theory to its roots, flimsy as they might be. As a matter of practicality, of course, the nonsense is that unionized employees who can (and often do) by contract require the presence of a representative do not need a statutory right, and the non-union employees are the ones with the need. Law, however, is often driven by theory rather than practicality.

This case does not mean that the statute as a whole does not apply to non-union employees. Non-union employees continue to have all their other statutory rights.



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No BFOQ in ADA cases
January 02, 2008 by Ross Runkel at LawMemo

The 9th Circuit, in an en banc opinion, has rejected application of Title VII and ADEA bona fide occupational qualifications (BFOQ) in ADA cases.

Bates v. UPS (9th Cir 12/28/2007) (en banc) (3-2)

Bates sued the employer for violation of the Americans with Disabilities Act (ADA) alleging unlawful exclusion from driving vehicles of 10,000 pounds or less if hearing impaired. The trial court found in favor of Bates. The 9th Circuit reversed.

The employer imposed the Department of Transportation (DOT) hearing standard for vehicles in excess of 10,000 pounds to vehicles of 10,000 pounds or less. The court considered the claim that an employer's safety qualification standard discriminated against otherwise qualified persons with disabilities, and the showing required of an employer to successfully assert the business necessity defense to the use of such a qualification.

Because the employer linked hearing with safe driving, the court concluded that the employer bore the burden to prove that nexus as part of its defense to the use of the hearing qualification standard; however, Bates bore the ultimate burden to show he was qualified to perform the essential function of safely driving a vehicle of 10,000 pounds or less. The court remanded for Bates to prove he was a qualified individual.

The court rejected the adaptation of the Title VII and the Age Discrimination in Employment Act (ADEA) bona fide occupational qualifications (BF0Q) safety standard requirement into the ADA context, where there was no BFOQ defense as such in the ADA (overruling Morton v. United Parcel Service, Inc., 272 F3d 1249 (2001)). Relying on statutory provisions of the ADA's version of the business necessity defense, the court stated the employer must show:

(1) "job-relatedness" by demonstrating that the qualification standard fairly and accurately measures the individual's actual ability to perform the essential functions of the job;

(2) "consistent with business necessity" by demonstrating that the disputed qualification standard substantially promotes the business's needs; and

(3) "performance cannot be accomplished by reasonable accommodation" by demonstrating either that no reasonable accommodation currently available would cure the performance deficiency or that such reasonable accommodation poses an undue hardship on the employer.

The DISSENT would require the employer bear the burden of showing, if it desired to adopt as a threshold requirement a minimum hearing level such as the DOT standard, that it can establish under the business necessity test that deaf applicants as a group who do not meet that requirement cannot drive vehicles of 10,000 pounds or less safely.



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