Mandated Paid Safe Days

Protect employeesThere are many unanticipated, unfair reasons why employees miss work and suffer lost pay, lost opportunities, and even disciplinary action. There are an equal number of emotionally compelling reasons to protect employees in these instances. But does that mean employers should be required to provide protection?

In the cases of serious health conditions for immediate family members, employee disabilities, and society’s military needs, for example, the question has been answered in the affirmative. We have national laws (and in many instances state laws) to address these situations. But what about mandated paid leave for something perhaps more difficult to determine with particularity: instances of domestic violence?

The Seattle City Council has passed a new ordinance requiring among other things that businesses operating within the City and that have 5 or more employees provide paid “safe days” to employees in the City who are victims of domestic violence. The ordinance goes into effect in September 2012.

The amount of paid leave is set on a scale depending on an employer’s size. Smaller employers with 5 to 249 employees are required to grant 56 hours of paid leave. Employers with 250 or more employees must provide 72 hours of paid leave. An employer’s employees are counted for purposes of determining eligibility whether or not the employees work within the City.

An employer with leave policies that provide at least the requisite levels of paid leave generally will satisfy the ordinance if the employer permits use of the leave for instances of domestic violence.

Other urban municipalities are expected to follow Seattle’s lead. But as goes the West Coast, so goes the rest of the nation? Doubtful.

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An Example of Administrative Exemption Error

Administrative ExemptionA few posts below, we discussed employer’s periodic over-reliance on the overtime exemption for administrative employees under the Fair Labor Standards Act. As noted, among the four primary exemptions under that act, we have found that employers most frequently misapply this exemption.

A recent federal appeals court decision highlights this point. In Whalen v. J.P. Morgan Chase & Co., the U.S. Court of Appeals for the Second Circuit held that a loan underwriter at J. P. Morgan Chase was not exempt from overtime entitlement under the administrative exemption.

J.P. Morgan Chase maintained that its loan underwriters were covered by this exemption because they met the minimum salary requirement, performed office work directly related to the general business operations, and exercised the requisite discretion and independent judgement. The trial court agreed, but the appeals court reversed that decision.

Central to the appeals court’s decision, the loan underwriter performed his duties according to detailed guidelines provided by the employer. He had no meaningful discretion to depart from those guidelines on his own. Thus, the appeals court said that the loan underwriter exercised no real independent judgment and discretion, which are key components of the exemption. Instead, the appeals court concluded that he was primarily involved in the “production” of the employer.

An employee primarily involved in the employer’s production of goods or its provision of the services it offers, in most cases, will not meet the requirements of the administrative exemption.

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The Military Spouse’s Residency Relief Act

Military SpousesThe new Military Spouse’s Residency Relief Act may raise questions for many employers about the tax treatment of wages for the spouses of active duty military personnel. The MSRRA could have a particularly notable impact in military heavy states like Virginia.

In short, the MSRRA exempts from state income tax the wages of the spouses of military personnel who move into a state to be with their service member spouse, even if that state otherwise would impose an income tax on the employee. The wages the employee earns will be exempt from state withholding. Additionally, even if the military spouse is outside the United States, the employee’s earnings are exempt from state withholding so long as the service member’s absence is in compliance with military orders.

The Act, as we understand it, is effective for any state or local income tax return beginning with a tax year that covers November 11, 2009.

(To ensure compliance with IRS requirements, readers are advised that any tax advice contained in this overview of the MSRRA was not intended to be used, and cannot be used, for the purpose of avoiding penalties under the Internal Revenue Code or applicable laws, or promoting, marketing or recommending to another party any matter addressed herein.)

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Gender Explicit Language Is Enough for Hostile Environment Case

Women-and-sexual-harassment-at-the-workplaceThe Eleventh U. S. Circuit Court of Appeals, in Reeves v. C. H. Robinson Worldwide, Inc., recently gave the go-ahead for a woman’s hostile work environment claim based on the pervasive use of sexually explicit language in the workplace. Of particular interest in the case, the offensive language was not directed at the claimant.

The claimant worked as a transportation sales representative for a shipping company. She was the only woman working in the sales area with six male co-workers. The work spaces were open cubicles. The sales workers could overhear each other.

The use of sexually crude and offensive language in the sales area was daily. Sexual jokes and comments and derogatory references to women (such as “f_ _ _ing b_tch”) were prevalent and casually used. The claimant overheard the men frequently discussing sexual antics of all kinds.

The men also listened to a raunchy morning radio program each day that routinely discussed , erotic behavior, the breast size of female celebrities, and similar topics. The claimant was told she could change the radio station, but each time she did, the men changed the station back.

The claimant sought help from immediate supervisors and formally complained to upper management, but the atmosphere in the workplace did not change. The claimant then resigned her employment and initiated legal action alleging sexual harassment. The trial court surprisingly (to my thinking) granted summary judgment for the employer, dismissing the case, finding the offensive language was not directed at the claimant based on her sex and therefore was not actionable.

Hostile Environment

The appeals court reversed the trial court’s ruling. It recognized that offensive language need not be targeted at the claimant in order to support a hostile environment claim. Indeed, the Supreme Court has clearly established that race-based conduct which materially alters an employee’s job is illegal even if the conduct is not directed at the individual in question. Gender-based conduct, actionable under the same statute, should not be analyzed differently.

Incredibly, some commentators have criticized this decision on First Amendment free speech grounds. Such criticism ignores the well established legal principle that offensive language concerning protected characteristics can be restricted, particularly in private workplaces. Employees are not free to make pervasive race or -based comments in the workplace. -based comments are no different. The workplace rarely, if ever, can be viewed as a public podium for unfettered free speech.

Ultimately, there is no legal substitute for employers to have a strong policy against this kind of workplace behavior, to enforce the policy, and to stop such conduct before it pervades the workplace.

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Meal Break Risks Under Federal Wage Laws

Wages LawMissed meal breaks in the workplace are coming under increasing legal scrutiny.

To be clear, an employee has no absolute entitlement to a meal break under federal wage laws (although this may be different under some state laws). But, if an employee is given a meal break period, either the employee must be completely relieved from his or her duties for more than twenty minutes, or the employee must be paid for the break time.

In many instances, employers unintentionally fail to pay employees for compensable meal breaks. In this day of pressure to raise workforce productivity, many employees are called to return to work temporarily during a break, disrupting the time during which the employee is supposed to be completely relieved of duties. As a result, the actual break period does not last the requisite uninterrupted time, and thus the employee legally should be paid. Some employers simply do not recognize this situation, and others have set time clocks to deduct automatically the standard meal break time each day without regard to whether the break period was taken without interruption, or even taken at all.

The problem for employers is compounded because, not only should the employee be paid for the interrupted or untaken meal break, but that time also may push the employee over the threshold for overtime wages for the workweek. If the employer does not pay overtime owed, it potentially has committed two violations.

Unpaid Wages

Additionally, defending unpaid wage claims of this nature are particularly difficult because the employer, admittedly, will not have accurate record of the time actually worked.

The Department of Labor and legal counsel for employees are aware of these compounding problems for employers, and at least in the latter case eagerly will take advantage of these problems. It is not enough that some employers mandate in their policies that a break be taken. The employer must either strictly enforce meal breaks or else monitor employee work time on a daily, case-by-case basis, without automatically deducting time for any scheduled breaks.

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Thompson v. North American Stainless, LP: Title VII’s Retaliation Protections Extend to Third Parties

Supreme Court of the United StatesOn January 24, 2011, the Supreme Court of the United States unanimously extended Title VII’s protections to an individual who was terminated after his fiancee filed a charge of discrimination with the Equal Employment Opportunity Office.

The facts of the case are relatively straight forward. Until 2003, both petitioner Eric Thompson and his fiancee, Miriam Regalado, were employees of respondent North American Stainless (NAS). In February 2003, the Equal Employment Opportunity Commission (EEOC) notified NAS that Regalado had filed a charge alleging discrimination. Three weeks later, NAS fired Thompson. Thompson complained that he had been fired in retaliation for his fiancee’s discrimination charge.

The District Court granted summary judgment to NAS, concluding that Title VII “does not permit third party retaliation claims.” 435 F. Supp. 2d 633, 639 (ED Ky. 2006). After a panel of the Sixth Circuit reversed the District Court, the Sixth Circuit granted rehearing en banc and affirmed the District Court’s opinion. 567 F.3d 804 (2009). The court reasoned that because Thompson did not “engag[e] in any statutorily protected activity, either on his own behalf or on behalf of Miriam Regalado . . . [he] is not included in the class of persons for whom Congress created a retaliation cause of action.” Id., at 807-808.

In ruling, the Supreme Court addressed the main concern with affording a fiancee protection under Title VII. NAS argued that allowing a fiancee to sue would open the floodgates to retaliation lawsuits from everyone with any connection to a complaining employee. However, the Court stated that “we do not think [this concern] justifies a categorical rule that third-party reprisals do not violate Title VII.” The Court then “decline[d] to identify a fixed class of relationships for which third-party reprisals are unlawful.” Instead, the Court stated that it will “depend on the particular circumstances.” The Court elaborated that “firing a close family member will almost always meet the standard, and inflicting a milder reprisal on a mere acquaintance will almost never do so.” Beyond that the Court declined to comment.

Retaliation

Once the Court held that certain aggrieved third parties had standing to bring a claim, it determined that Thompson clearly falls under the category of people who can sue for retaliation. The Court stated, “Thompson is not an accidental victim of the retaliation – collateral damage, so to speak, of the employer’s unlawful act.” “To the contrary, injuring him was the employer’s intended means of harming Regalado. Hurting him was the unlawful act by which the the employer punished her. In these circumstances, we think Thompson well within the zone of interests sought to be protected by Title VII. He is a person aggrieved with standing to sue.”

Based on this ruling, it is clear that courts will carefully consider the factual circumstances involved in each case. If a third party can factually assert that their adverse employment decision falls within the “zone of interests” sought to be protected by Title VII, then Employers will have difficulty obtaining summary judgment.

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New Posting Requirement For Federal Contractors

Government ContractThe U.S. Department of Labor has issued a final rule specifying the contents of a new required notice for federal contractor and subcontractor employees. The notice, to be titled “Notification of Employee Rights Under Federal Labor Laws,” is intended to advise employees of their rights under the National Labor Relations Act.

The details of the notice are prescribed by the DOL. Among other things, contractors are required to advise employees specifically that they have the right to “organize a union to negotiate” with their employer, to “form, join or assist a union,” to “bargain collectively” and “take action to improve working conditions,” and to “choose not to do any of these activities.” The required notice also specifies various employer and union activities that are illegal during employee efforts to organize. These prohibited activities are well known to labor lawyers, but may take some employers by surprise.

Importantly, where a significant portion of a contractor’s workforce is not proficient in English, the contractor must provide the same notice in the language of those employees. Copies of the notice, including translations in many languages, are available from the DOL’s Office of Labor-Management Standards.

The new regulation applies to new federal contracts beginning June 21, 2010. Notably, however, the regulation, and hence the posting requirement, does not apply to prime contracts under $100,000 or to subcontracts below $10,000.

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