Wednesday, July 29, 2015

NLRB Overruled: AT&T May Ban “Prisoner” Shirts

During union contract negotiations, AT&T employees were encouraged to wear t-shirts on the job that said “Inmate” on the front and “Prisoner of AT&T” on the back. AT&T accepted the employees wearing the shirts in the offices and other non-public workspaces. Not surprisingly, AT&T did not want employees wearing these shirts anywhere they were engaging with the public. Suspensions were issued to 183 employees who refused to stop wearing the shirts with the public.

The union challenged these suspensions as unfair labor practices with the National Labor Relations Board (“NLRB”). AT&T responded that it reasonably believed these t-shirts were offensive and would damage its relationships with its customers. The administrative law judge and the NLRB ruled for the employees. They decided that AT&T’s concerns were unsupported because the shirts “would not have been reasonably mistaken for prison garb.”

On appeal to the D.C. Court of Appeals, the union decision was overturned because “common sense sometimes matters in resolving legal disputes.” Previous cases have held that if an employer can demonstrate “special circumstances” to limit union displays it can outweigh the employee’s right to display it. A reasonable belief that the display will damage customer relations is sufficient. Relying on whether it would be confused with prison garb was the incorrect test, according to the court. The NLRB does not have the right to ignore a company’s reasonable business judgment and substitute its own.

Tuesday, July 28, 2015

“Most Workers are Employees” Says the DOL

The U.S. Department of Labor has issued a new Interpretation of the Fair Labor Standards Act.  Determining whether a worker is an employee will continue to be based on the “economic realities” test set forth by the courts. However, the Department of Labor is now instructing employers that the test will be broadly construed to make it more likely that a worker will be considered an employee.

The economic realities test has six questions:

  • Is the Work an Integral Part of the Employer’s Business?
  • Does the Worker’s Managerial Skill affect the Worker’s Opportunity for Profit or Loss?
  • How Does the Worker’s Relative Investment Compare to the Employer’s Investment?
  • Does the Work Performed Require Special Skill and Initiative?
  • Is the Relationship Between the Worker and the Employer Permanent or Indefinite?
  • What is the Nature and Degree of the Employer’s Control?

In the Interpretation document, the DOL provides some illustrations of what will be evaluated, such as: work performed away from the company’s premises may still be considered integral, how much control is exerted by the employer (and not why the employer is exerting it; risk of loss incurred by the employee for managerial decisions and comparing the relative investments of both parties. No single factor will determine the worker’s status and the “factors should be considered in totality to determine whether a worker is economically dependent on the employer, and thus an employee.” Employers will have to re-evaluate their workers based on the broader definition of employees.

Monday, July 27, 2015

EEOC Broadens Title VII To Ban Sexual Orientation Discrimination

Title VII does not expressly refer to sexual orientation in its list of prohibited forms of discrimination. However, the EEOC has recently ruled that sexual orientation need not be specifically enumerated because it is inherently a “sex-based consideration.”

In the case before the EEOC, a male air traffic controller filed a complaint against the FAA asserting that he was not selected for a managerial position because he was gay. When the controller filed his complaint, he asserted discrimination based on sex (male and sexual orientation).

After reviewing the complaint, the EEOC acknowledged that Title VII does not identify sexual orientation as a form of discrimination. It then concluded “an allegation of discrimination based on sexual orientation is necessarily an allegation of sex discrimination under Title VII.” This conclusion was based on the theory that an inquiry into a sexual orientation claim must necessarily include whether an employer has “relied on sex-based considerations” such as sex-based preferences, assumptions, expectations, stereotypes, or norms when making the challenged employment action. This decision adds to the EEOC’s previous ruling that transgender individuals may state claims for sex discrimination.  

Thursday, July 23, 2015

Recent Amendments to the Healthy Workplaces, Healthy Families Act of 2014

Los Angeles/Orange County, California

On July 13, 2015, the California Legislature passed amendments to the Healthy Workplaces, Healthy Families Act of 2014 (the “Act” or “PSLL”). These amendments were signed by the Governor on the same day and are effective immediately.  The changes were intended to provide clarification and address some areas where employers expressed concern. This Addendum discusses some of the key provisions of the amendments to the PSLL as originally enacted. Among other things, the amendments make the following changes to the PSLL as originally enacted.

1. Previously the PSLL provided that employees were entitled to paid sick days if, on or after July 1, 2015, they worked in California for 30 or more days within a year from the commencement of employment. The amendments clarify that the 30 or more days must be for the same employer.

2. As originally enacted, the PSLL required employers to provide paid sick leave either by (a) granting the employee 3 days or 24 hours of leave in lump-sum at the beginning of each year; or (b) allowing the employee to accrue the leave at a minimum rate of 1 hour for every 30 hours worked. It is important to note that in many sections of the original PSLL, the definition of “year” was unclear.  For the most part, the amendments clarify that “year” means “each year of employment, calendar year or 12-month period,” as determined by the employer.

With respect to (b) above (the accrual method), the amended PSLL now provides that an employer may use an accrual method different from providing 1 hour for every 30 hours worked, provided such accrual is on a regular basis and the employee will have 24 hours of accrued paid sick leave or paid time off (PTO) available by the 120th calendar day of employment, each calendar year, or each 12 month period. For employers that tie sick leave or PTO to days, months, pay periods or similar methods and not to hours worked, this change is significant. It appears that such employers can be relieved of the obligation to track actual hours worked so long as the employee accrues 24 hours or 3 days of paid sick leave within the first 120 days of the year.

3. The amendments also include a “grandfather clause” for employers who provided paid sick leave or PTO before January 1, 2015 using a different accrual method than 1 hour for every 30 hours worked. This “grandfather clause” allows an employer to keep its paid sick leave or PTO policy in place before January 1, 2015 if such policy provides accrual on a regular basis so that an employee has no less than 1 day or 8 hours of accrued paid sick leave or PTO within 3 months “of employment of each calendar year, or each 12-month period,” and the employee was eligible to earn at least 3 days or 24 hours of paid sick leave or PTO within 9 months of employment. However, if an employer modifies its pre-January 1, 2015 accrual method then the employer must comply with the accrual or lump-sum requirements outlined in the PSLL as amended. It is unclear whether this (quoted) portion of the amendment contains typographical errors such that the phrase was intended to read “of employment, each calendar year, or each 12-month period.” 

4. The amendments also modified how employers are to calculate the sick leave rate of pay. Originally, the PSLL provided that the rate of pay for sick leave was calculated based on the employee’s hourly wage. However, if the employee, in the 90 days of employment before taking accrued sick leave, had different hourly pay rates, was paid by commission or piece rate, or was a nonexempt salaried employee, then the rate of pay was calculated by dividing the employee’s total wages (not including overtime premium pay), by the employee’s total hours worked in the full pay periods of the prior 90 days of employment. This provision created significant confusion regarding the correct rate of pay for exempt and nonexempt employees who received some form of incentive pay in addition to their regular hourly wage. 

Pursuant to the amendments, the PSLL now provides that employers are required to calculate paid sick leave for nonexempt employees based upon either of the two following options: (1) regular rate of pay for the week in which the employee uses sick leave (i.e., the rate used when calculating the overtime premium rate); or (2) by dividing the employee’s total wages, excluding overtime premium pay, by the employee’s total hours worked in the full pay periods of the prior 90 days of employment. For exempt employees, paid sick leave shall be calculated in the same manner as the employer calculates wages for other forms of paid leave time.

To summarize, it is this author’s opinion that the amendments to the PSLL do not go far enough and in many ways present confusion on top of confusion. Employers are strongly encouraged to consult appropriate counsel with questions about how to apply the PSLL, as amended, to their specific circumstances.


Wednesday, July 22, 2015

IBM Helps Working Moms Ship Breast Milk

An IBM spokesperson, shared that IBM will help the company’s working mom’s ship breast milk home while they are on business trips – the result of focus group for IBM working mothers expressing concern about the issue. The program will start with domestic travel, but will soon go global.

Details are still unfolding, but the company hopes to have women use a smartphone app to have a temperature-controlled package delivered to their hotel. IBM will pay for the packaging and shipping expenses.

Tuesday, July 21, 2015

Walmart Sued for Health Insurance Denial to Gay Worker’s Spouse

Walmart employee Jackie Cote sued the retailer last week, saying its prior policy of denying health insurance to the spouses of gay employees violated gender discrimination laws. The lawsuit, filed in U.S. District Court in Boston, seeks nationwide class-action status.

Walmart began offering health insurance benefits to same-sex spouses last year, after the U.S. Supreme Court in 2013 struck down part of the Defense of Marriage Act that had previously denied federal benefits to married gay couples. Cote, who has worked at Walmart since 1999, said in the lawsuit that her wife, Diana Smithson, developed cancer in 2012 and the denial of insurance led to more than $150,000 in medical debt. Cote and Smithson were married in Massachusetts in 2004, days after a court ruling made the state the first to allow gay nuptials. Smithson also worked for Walmart until 2008, when she left to care for Cote's elderly mother, according to the lawsuit. The company then repeatedly denied requests by Cote to add her wife to her insurance policy.

Cote filed a complaint with the U.S. Equal Employment Opportunity Commission last year, a required step prior to before filing an employment discrimination lawsuit. The commission said in January that Walmart violated gender discrimination laws by denying benefits to Smithson. The commission said if Cote’s spouse was a man or her wife was married to a man, the couple would've received insurance. Walmart argued that because federal anti-discrimination laws did not apply to gay employees, it was not obligated to provide benefits to their spouses. Walmart’s claim is centered on its’ self-insured status which prevents the company from being subjected to state insurance regulations prohibiting discrimination – a distinction unavailable to companies who have 3rd part insurers.

A Walmart spokesman said in a statement that the company's benefits coverage before the 2014 change was legal. Cote’s lawsuit seeks to certify a class of current and former gay Walmart workers married before Jan. 1, 2014, and various damages for employees, including the value of benefits that were denied and any out-of-pocket medical expenses.