On July 17, 2013, the Fourth Circuit Court of Appeals held, in a 2-1 decision, that President Obama's January 4, 2012 recess appointments to the National Labor Relations Board ("NLRB") were unconstitutional because the Senate was not in "recess" at the time of the appointments. The Fourth Circuit is the third federal appellate court to weigh in on this issue, joining the D.C. Circuit (which also held that the January 4, 2012 recess appointments were unconstitutional) and the Third Circuit (which held that Craig Becker's March 27, 2010 recess appointment was unconstitutional).
In the two consolidated cases before the Fourth Circuit, the majority followed the logic of the D.C. Circuit and the Third Circuit, and determined that the President is only authorized to make recess appointments without confirmation by the Senate during recesses that occur between sessions of the Senate rather than breaks in activity that occur while the Senate is in session. This issue will ultimately be decided by the Supreme Court, which has agreed to consider the NLRB's appeal from the D.C. Circuit's Noel Canning decision.
The New York City Council passed the Earned Sick Time Act on June 27, 2013, overriding Mayor Bloomberg's veto. Under the Act, private sector employers with 20 or more employees within New York City will be required to offer at least 40 hours of paid sick leave per year to each employee beginning on April 1, 2014. Private sector employers with less than 20 employees within New York City will be required to offer at least 40 hours of unpaid sick leave per year to each employee beginning on April 1, 2014. Beginning on October 1, 2015, private sector employers with 15 or more employees within New York City will be required to offer at least 40 hours of paid sick leave per year to each employee, and private sector employers with less than 15 employees within New York City will continue to be required to offer at least 40 hours of unpaid sick leave per year to each employee. These implementation dates could be postponed if economic indicators based on a financial index maintained by the Federal Reserve Bank of New York do not meet certain conditions. The Act does not cover independent contractors, work study students, public sector employees, and certain types of hourly professional employees.
The Act provides that an eligible employee will earn at least one hour of sick leave for every 30 hours worked. However, employers are not required to permit employees to use accrued sick leave until 120 calendar days after the commencement of employment. Part-time employees are also covered by the Act, and will earn sick leave at the same rate. Employers may provide employees with a faster accrual of sick leave than what is required by the Act, and may permit employees to use sick leave within their first 120 calendar days of employment.
Under the Act, accrued sick leave may be used for absences due to: (1) the employee's own health condition; (2) the employee's need to care for a spouse, domestic partner, child, parent, or the child or parent of a spouse or domestic partner; or (3) the closure of the employee's place of business due to a public health emergency or the employee's need to care for a child whose school or child care provider has been closed due to a public health emergency. An employer may require documentation that sick leave was used for one of these purposes only if the absence is for more than three consecutive work days. The Act prohibits employers from retaliating against employees for their use of sick leave or for filing a complaint alleging a violation of the Act.
The number of employees that an employer has is determined by counting all compensated workers during a given week, including full-time, part-time, and per diem employees. If the number of employees fluctuates, the size of the employer may be determined for the current calendar year based upon the average number of employees who worked for compensation per week during the preceding calendar year. In chain businesses, the total number of employees in the group of establishments must be counted.
Employers may require reasonable notice from an employee who intends to use sick leave. If the sick leave is foreseeable, the employer may require up to seven days' notice. If the sick leave is not foreseeable, an employer may only require notice as soon as practicable.
If an employee is transferred from one location to another location within New York City, but continues to be employed by the same employer, the employee is entitled to keep his or her accrued sick leave. However, an employer is not required to provide financial or other reimbursement to an employee upon termination, resignation, retirement, or other separation, whether voluntary or involuntary, for accrued unused sick leave.
The Act does not apply to any employee covered by a valid collective bargaining agreement, as long as the provisions of the Act are expressly waived in the collective bargaining agreement and the agreement provides for a comparable benefit to covered employees in the form of paid days off. For employees in the construction or grocery industry who are covered by a valid collective bargaining agreement, there is no requirement that the agreement provide for a comparable benefit to covered employees in order for such employees to be exempt from the provisions of the Act -- it is sufficient that the collective bargaining agreement expressly waive the provisions of the Act, regardless of whether a comparable benefit is provided.
On June 26, 2013, the United States Supreme Court issued its highly anticipated decision in United States v. Windsor. The Court ruled that a portion of the Defense of Marriage Act (“DOMA”) is unconstitutional. DOMA, which was enacted in 1996, restricted the definitions of the terms “marriage” and “spouse” for purposes of any federal law to include only opposite-sex marriages. The effect of this provision was to deny recognition of same-sex marriages for purposes of all federal laws, including the laws governing taxation and employee benefits. As a result, same-sex couples married in a jurisdiction permitting same-sex marriage, while treated as legally married for state law purposes, were not treated as married under any federal law.
In a 5-4 decision, the Supreme Court in Windsor found that this provision of DOMA is “unconstitutional as a deprivation of the liberty of the person protected by the Fifth Amendment of the Constitution.” In explaining its decision, Justice Kennedy, writing for the majority, stated that:
DOMA instructs all federal officials, and indeed all persons with whom same-sex couples interact, including their own children, that their marriage is less worthy than the marriages of others. The federal statute is invalid, for no legitimate purpose overcomes the purpose and effect to disparage and to injure those whom the State [New York], by its marriage laws, sought to protect in personhood and dignity. By seeking to displace this protection and treating those persons as living in marriages less respected than others, the federal statute is in violation of the Fifth Amendment.
As a result of the decision in Windsor, the federal government will now recognize same-sex marriages in those states where same-sex marriages are permitted. Same-sex marriage is permitted in the following jurisdictions: California (effective June 28, 2013, as a result of the Supreme Court’s Proposition 8 decision in Hollingsworth v. Perry); Connecticut; Delaware (effective July 1, 2013); Iowa; Maine; Maryland; Massachusetts; Minnesota (effective August 1, 2013); New Hampshire; New York; Rhode Island (effective August 1, 2013); Vermont; Washington; and Washington, D.C. Therefore, at least for same-sex couples legally married and residing in one these jurisdictions, their marriages will now be recognized as legal marriages for the purposes of all federal laws.
Federal recognition of same-sex marriages will have a significant impact on employee benefit plans and arrangements. As a result of the decision in Windsor, for purposes of employee benefit plans and arrangements governed by the Internal Revenue Code (“Code”) and the Employee Retirement Income Security Act (“ERISA”), a spouse will include a same-sex spouse, at least with respect to those jurisdictions within which same-sex marriage is legal.
Summarized below are the principal effects of the decision on common employee benefit plans and arrangements for legally married same-sex spouses:
Health Benefits – The value of health coverage (including dental and vision) for a same-sex spouse no longer will be imputed in the employee’s taxable income. In addition, any employee premium contributions in connection with coverage for a same-sex spouse may now be made on a pre-tax basis pursuant to a Code Section 125 cafeteria plan.
Health FSAs, HRAs and HSAs – Employees may use amounts available under a health flexible spending account, a health reimbursement account or a health savings account to reimburse the medical expenses of a same-sex spouse.
Cafeteria Plan Change of Status Rules – Generally, an employee may only change a cafeteria plan election mid-year (i.e., outside of an open enrollment period), if a “change of status” event has occurred. A change of status for a same-sex spouse will now be considered a change of status under the cafeteria plan rules.
COBRA/Special Enrollment Rules – A same sex spouse will be treated as a qualified beneficiary under the federal COBRA continuation coverage rules. The HIPAA special enrollment rules also will apply with respect to same-sex spouses.
FMLA – Covered employers must now provide leave to eligible employees to care for an FMLA-qualifying condition of a same-sex spouse, if the covered employee resides in a state where same-sex marriage is legally recognized.
Retirement Plans – A same-sex spouse will be treated as a spouse for purposes of retirement plans governed by ERISA and the Code, including 401(k) plans, 403(b) plans, defined benefit plans, and 457(b) plans. As a result, a same-sex spouse generally will have the same spousal rights as an opposite-sex spouse. For example:
A same-sex spouse will be the beneficiary of the employee participant, unless the spouse consents to the designation of a different beneficiary. Further IRS guidance will be required regarding the continued validity of prior beneficiary designations that likely were made without a requirement that the consent of a same-sex spouse be obtained.
Benefits paid under certain types of plans (defined benefit plans, money purchase pension plans and other defined contribution plans providing for annuity forms of payment) generally must be paid in the form of a 50% joint and survivor annuity with the same-sex spouse as the co-annuitant, unless the spouse consents to a different form of payment.
A same-sex spouse will be allowed to roll over an eligible distribution from a plan to an IRA or other retirement plan.
A same-sex spouse will be treated as a spouse for purposes of the qualified domestic relations order rules.
Hardship distributions under certain types of plans (generally, defined contribution plans that permit such distributions) will be available to pay for medical care, tuition and burial expenses with respect to a same-sex spouse.
Other Fringe Benefits – With respect to other benefit arrangements governed by the Code, benefits provided to a same-sex spouse generally should be treated for tax purposes in the same manner as benefits provided to an opposite-sex spouse.
Many plans were drafted to specifically incorporate the DOMA definition of spouse to avoid any confusion regarding the treatment of same-sex spouses under the terms of the plan. Therefore, plan documents will need to be reviewed to determine if the DOMA definition of spouse is reflected. If it is, an amendment to the plan may be required. With respect to qualified retirement plans, any required amendment generally will need to be adopted by the last day of the current plan year, unless the IRS provides for a delayed amendment due date.
At present, it is unclear how couples who were legally married in a jurisdiction recognizing same-sex marriage, but who are residing in a jurisdiction that does not recognize the validity of the marriage, will be treated under federal law. For example, if an employee was legally married to a same-sex spouse in New York, but is residing in Pennsylvania (where same-sex marriages are not recognized), it is unclear if that employee would be considered to be legally married under federal law. Further guidance on this issue will be required. Finally, the Windsor decision has no impact on unmarried same-sex domestic partners.
The IRS has indicated that it will be moving swiftly to provide guidance on the impact of the Windsor decision. Therefore, we anticipate that the IRS and other federal agencies will be issuing guidance on many of the issues noted above in the near future.
There are mirages in the labor relations and employment desert. Concepts and principles that, for a moment, you see and understand, but moments later you have confused or misapplied. The “fluctuating work week” method of calculating overtime is one of those employment law mirages. At first glance, it appears as an oasis for employers in the FLSA desert – then, like a mirage, disappears when carefully scrutinized and correctly applied.
The “fluctuating work week” (FWW) method of calculating overtime is an alternative to the familiar “time and one-half” method for paying non-exempt employees who actually work more than 40 hours in a workweek. It was first recognized more than 70 years ago by the United States Supreme Court in Overnight Motor Transport Co. v. Missel, and was later codified in the federal wage and hour regulations at 29 C.F.R. §778.114.
Often referred to as the “half-time” measure of overtime, it applies: (1) if there is a mutual understanding between an employer and a non-exempt employee that the employee will be paid a fixed weekly salary no matter how many hours that employee works in a week; (2) if the fixed salary is sufficiently large so that the employee’s regular rate of pay never drops below the minimum wage (federal or state); (3) if the employee’s work week fluctuates both over and under 40 hours per week; and (4) if the employee is paid a “half-time” overtime premium for hours worked beyond 40 in a week. Using the “half-time” method, the employee’s overtime rate is one-half of the rate determined by dividing the employee’s weekly salary by the number of hours that the employee actually works in a week. In other words, the overtime rate paid for hours worked in excess of 40 in a week declines the more hours that an employee works.
Not surprisingly, employees are not quick to embrace this system, and employers must consider the “labor relations” and “employee morale” implications of using the FWW method, even in those limited circumstances where it can be lawfully applied. Employers who do use the FWW method are subject to legal challenges on many fronts. For example, the USDOL takes the position that the FWW method may only be applied to employees whose weekly hours do not customarily follow a regular schedule and fluctuate both above and below 40 hours per week. In other words, there must be evidence that the employee’s hours regularly dip below 40 in a week without any diminution in that employee’s fixed salary. Second, the USDOL insists that the employee be paid a fixed salary – obviously without deductions or offsets, but also without non-discretionary enhancements such as commissions or bonuses. Note, this “fixed salary” requirement is more stringent than the “salaried basis” test applicable to the “white collar” overtime exemptions. In 2011, the USDOL considered, but ultimately rejected, proposed amendments to its regulations that would have allowed employers to use the FWW method even if the employer paid employees non-discretionary earned bonuses in addition to the required “fixed salary." Clearly, the USDOL is not a fan.
Further complicating the use of the FWW method for New York employers is the open question whether this method also applies to overtime payments under New York law. Several decisions (and an older NYSDOL opinion letter) have suggested that the federal methodology for computing overtime is permissible, but there is no clear precedent on this issue. Employers should carefully consider whether to use the FWW method to compute overtime, and those who do should regularly review those arrangements to insure that they continue to meet the applicable standards (fluctuating work week, fixed salary, regular rate above the minimum wage, etc.). Be careful or this FLSA “oasis” may turn out to be a “mirage” that will only produce unhappy employees and costly litigation.
The Treasury Department has announced that the implementation date for the employer mandate provisions of the Patient Protection and Affordable Care Act (“ACA”) (i.e., the provisions requiring employers with 50 or more full-time employees to provide affordable, minimum value health coverage to full-time employees or pay a penalty to the federal government) has been delayed until January 1, 2015. The employer mandate provisions had been scheduled to take effect on January 1, 2014. In its announcement, the Treasury Department indicated that the delay was in response to concerns regarding the complexity of the rules and the administrative challenges posed by the reporting requirements. The Treasury Department stated that the delay would afford the administration additional time to issue simplified reporting rules and give employers time to adapt their health coverage and reporting systems to conform to the rules.
As a result of the implementation delay, employers will not be subject to any penalties for the failure to provide affordable, minimum value coverage to their full-time employees for 2014. However, the delay applies only to the employer mandate portion of ACA. Other ACA changes scheduled to be fully effective in 2014 (including the individual mandate, the required employer-provided notice regarding the availability of exchange coverage, the 90-day waiting period rules, the prohibition on pre-existing condition limitations for all individuals, the out-of-pocket and cost-sharing limitations, and the prohibition on any annual and lifetime benefit limits) will take effect without delay, unless the agencies provide further relief.
While some employers might consider taking a “breather” from some of their ACA compliance efforts, the delay isn’t broad enough to ignore ACA altogether until 2014. Indeed, some employers should view the delay as a renewed opportunity to do some compliance planning, without the pressure of a looming effective date.
The Treasury Department has indicated that formal guidance regarding the delayed employer mandate implementation date will be issued soon.
The Occupational Safety and Health Administration ("OSHA") issued a new policy in April of 2013 focused on protecting temporary workers. In a memorandum that was issued to all OSHA Regional Directors, the agency explained that the policy was needed because there were several 2013 workplace fatalities involving temporary workers who had not received adequate training. Going forward, all OSHA investigators have been instructed that they need to “determine within the scope of their inspections whether any employees are temporary workers and whether any of the identified temporary employees are exposed to a violative condition.”
OSHA’s new policy does not appear to be a dramatic or drastic change in the agency’s direction at this time. Employers who employ temporary workers through staffing agencies have always had -- and will continue to have -- an obligation to ensure that those workers are correctly trained and protected from workplace hazards (e.g., personal protective equipment, lockout/tagout, and HazCom, to name just a few). Similarly, staffing agencies who have absolutely no supervisory role over employees or any control over the workplace at issue would not appear to be subject to citations under OSHA’s multi-employer worksite doctrine. However, OSHA’s initiative seemingly includes a desire to place an affirmative “due diligence” obligation on staffing agencies to know what tasks their employees will be performing after being assigned to an employer and/or what safety hazards they might be exposed to. At this point, OSHA has not explained exactly what such a “due diligence” obligation might include.
If and when the agency provides additional guidance, we will report it on this blog.
Recently, the City of Buffalo joined the “Ban the Box” club, enacting an ordinance amending Chapter 154 of the Code of the City of Buffalo to prohibit employers from inquiring about an applicant’s criminal convictions during the application process. This means that employers are prohibited from including such inquiries on employment applications or asking questions about an applicant’s criminal convictions at any time prior to the first interview. The ordinance applies to public and private employers located within the City of Buffalo, as well as any vendors of the City of Buffalo (regardless of location), with 15 or more employees. The ordinance was initially set to go into effect immediately, but there is an amendment pending that would delay the effective date to January 1, 2014. It is expected that the amendment will pass.
There are some exceptions to this general rule. For example, the ordinance allows inquiries about a criminal conviction where such a conviction would bar employment in that position. Further, the ordinance does not apply to any public or private school or to a public or private service provider that provides care to children, young adults, senior citizens, or the physically or mentally disabled. The ordinance also does not apply to any Fire or Police Departments.
The ordinance provides for a private right of action for an aggrieved party to seek injunctive relief, damages, and attorneys’ fees. Additionally, any individual, whether aggrieved or not, may file a complaint with the Commission on Citizens' Rights and Community Relations. Upon a finding of probable cause, the Director of the Commission on Citizens' Rights and Community Relations may request that the Buffalo Corporation Counsel pursue an action against the accused employer seeking penalties of $500 for the first violation of the ordinance and $1,000 for each subsequent violation.
Although Buffalo’s “Ban the Box” legislation does not prohibit employers from considering a criminal conviction in the hiring process, employers must be aware that Article 23-A of the New York Corrections Law protects an applicant from discrimination based on a past criminal conviction unless: (1) there is a “direct relationship” between the criminal offense and the position sought; or (2) granting employment would pose an “unreasonable risk” to property or to the safety or welfare of specific individuals or the general public. This analysis requires an employer to consider all of the following eight factors:
The public policy of the state to encourage the employment of persons previously convicted of one or more criminal offenses.
The specific duties and responsibilities necessarily related to the employment sought or held by the person.
The bearing, if any, the criminal offense or offenses for which the person was previously convicted will have on his fitness or ability to perform one or more such duties or responsibilities.
The time which has elapsed since the occurrence of the criminal offense or offenses.
The age of the person at the time of occurrence of the criminal offense or offenses.
The seriousness of the offense or offenses.
Any information produced by the person, or produced on his behalf, regarding his rehabilitation and good conduct.
The legitimate interest of the public agency or private employer in protecting property and the safety and welfare of specific individuals or the general public.
Going forward, employers who are covered by the ordinance should revisit their application process and revise their employment applications to comply with the “Ban the Box” legislation. Any hiring managers, supervisors, or other personnel who are involved in the hiring process should be trained concerning the ordinance as well as the limitations contained in Article 23-A of the New York Corrections Law.
A recent Advice Memorandum from the National Labor Relations Board's Division of Advice provides employers further guidance on how to address and structure employee confidentiality requirements during investigations. As we reported before on this blog, in Banner Health System, the Board held that an employer violated Section 8(a)(1) of the National Labor Relations Act by directing employees not to discuss complaints made to the employer with co-workers while an investigation into the matter is pending. In doing so, the Board put employers on notice that “blanket” confidentiality requirements would violate the right of employees to engage in protected concerted activity.
In the recent Advice Memorandum, the Division of Advice addressed the application of Banner Heath in reviewing Verso Paper’s confidentiality rule. This case raised the question whether Verso’s confidentiality requirement “unlawfully interfered with employees’ Section 7 rights by precluding employees from disclosing information about ongoing investigations into employee misconduct.” Verso’s Code of Conduct provided:
Verso has a compelling interest in protecting the integrity of its investigations. In every investigation, Verso has a strong desire to protect witnesses from harassment, intimidation and retaliation, to keep evidence from being destroyed, to ensure that testimony is not fabricated, and to prevent a cover-up. To assist Verso in achieving these objectives, we must maintain the investigation and our role in it in strict confidence. If we do not maintain such confidentiality, we may be subject to disciplinary action up to and including immediate termination.
Citing the Board’s decision in Banner Health, the Division of Advice agreed with the Regional Director that the rule was unlawfully overbroad, and advised that a complaint should be issued, absent settlement, against Verso for violating Section (8)(a)(1) of the NLRA. The Region reasoned that Verso’s provision was in fact a “blanket rule” regarding confidentiality of employee investigations. Instead, Verso’s rule needed to demonstrate a case-by-case need for confidentiality. The Division of Advice stressed that the employer has the burden to show in each particular situation that it has a legitimate and substantial business justification for confidentiality, which will outweigh the interference with employees' Section 7 rights. The Division of Advice also reiterated that a general concern with the investigation’s integrity is not enough, and cited the following factors mentioned in Banner Health where an employer may require confidentiality: (1) there are witnesses in need of protection; (2) evidence is in danger of being destroyed; (3) testimony is in danger of being fabricated; or (4) there is a need to prevent a cover-up.
One could argue that the Verso Advice Memorandum did not plow any new ground beyond the Board's decision in Banner Health. The Advice Memorandum reaffirms the principle set forth in Banner Health that a simple “blanket rule” of confidentiality during an investigation into employee misconduct will be found to be unlawful. Rather, the employer must engage in an individualized assessment considering the need for confidentiality in each particular case, analyzing the factors mentioned in Banner Health.
Given the Board’s current position, employers are well advised to draft confidentiality rules consistent with Banner Health’s “specificity” requirements. In this respect, the Verso Advice Memorandum provides some helpful guidance. First, the Division of Advice noted that the first two sentences of Verso’s rule lawfully set forth the interest in protecting the integrity of Verso’s investigations, which were:
Verso has a compelling interest in protecting the integrity of its investigations. In every investigation, Verso has a strong desire to protect witnesses from harassment, intimidation and retaliation, to keep evidence from being destroyed, to ensure that testimony is not fabricated, and to prevent a cover-up.
Second, the Division of Advice suggested that, consistent with Banner Health, Verso could modify the remainder of the rule to lawfully advise its employees that:
Verso may decide in some circumstances that in order to achieve these objectives, we must maintain the investigation and our role in it in strict confidence. If Verso reasonably imposes such a requirement and we do not maintain such confidentiality, we may be subject to disciplinary action up to and including immediate termination.
We must note that this is only an Advice Memorandum, and the guidance is not binding on the Board. Employers should also note that the Banner Health case may not survive the Supreme Court's consideration of the D.C. Circuit's decision in Noel Canning v. NLRBand the Third Circuit's decision in NLRB v. New Vista Nursing and Rehabilitation, LLC. If the Banner Health decision survives, however, the Verso Advice Memorandum at least provides some insight to employers on how to comply with Banner Health. Avoid blanket rules and tailor policies to specific facts involved in the employee investigation.
On June 24, 2013, the U.S. Supreme Court issued its decision in Vance v. Ball State University, which addressed the issue of who is a "supervisor" under Title VII of the Civil Rights Act. Under Title VII, an employer can be held liable for harassment perpetrated by a non-supervisory employee only if it was negligent in controlling working conditions. If the harassment is perpetrated by a "supervisor," and the harassment results in a tangible adverse employment action, the employer is strictly liable. If the harassment is perpetrated by a "supervisor," but no tangible adverse employment action is taken, the employer can avoid liability by establishing that it exercised reasonable care to prevent and correct harassing conduct and that the plaintiff unreasonably failed to take advantage of the preventive or corrective opportunities that were provided.
In a 5-4 majority opinion authored by Justice Alito, the Supreme Court affirmed a decision rendered by the Seventh Circuit Court of Appeals granting summary judgment to Ball State University in a claim filed by an employee alleging that a co-worker had created a racially hostile work environment. Both the District Court and the Seventh Circuit had held that the co-worker was not a supervisor because she lacked the authority to hire, fire, demote, promote, transfer, or discipline the plaintiff. Accordingly, the District Court and the Seventh Circuit analyzed the case under the standards for non-supervisory harassment under Title VII, and determined that Ball State University could not be held liable, because it was not negligent with respect to the alleged conduct by the plaintiff's co-worker.
The Supreme Court specifically held that "an employer may be vicariously liable for an employee's unlawful harassment only when the employer has empowered that employee to take tangible employment actions against the victim, i.e., to effect a 'significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing a significant change in benefits.'" The Supreme Court also held that the "ability to direct another employee's tasks is simply not sufficient" to establish an employee as a supervisor for purposes of Title VII liability. According to the Supreme Court, what makes a person a supervisor is the ability to function as an agent of the employer "to make economic decisions affecting other employees under his or her control."
The Supreme Court majority explicitly rejected the definition of "supervisor" set forth by the Equal Employment Opportunity Commission ("EEOC") in its Enforcement Guidance, finding that definition to be "a study in ambiguity." The EEOC's Enforcement Guidance provides that an employee, in order to be classified as a supervisor, must have a level of authority "of sufficient magnitude so as to assist the harasser explicitly or implicitly in carrying out the harassment." The Supreme Court majority declared that it was adopting a more workable standard that could be more easily applied, so that parties would know early in the litigation which employees will be considered "supervisors" under Title VII.
The Supreme Court's decision significantly curtails the universe of employees whose actions may be imputed to employers for purposes of Title VII liability. This decision will certainly have a profound effect on Title VII litigation in the future.
On June 14, 2013, the U.S. Court of Appeals for the Fourth Circuit held that the rule promulgated by the National Labor Relations Board ("NLRB") requiring employers to post a notice of employee rights under the National Labor Relations Act ("NLRA") is invalid. The Fourth Circuit is the second appellate court to strike down the NLRB's notice posting rule. The U.S. Court of Appeals for the D.C. Circuit issued a decision on May 7, 2013 also holding that the rule is invalid.
The Fourth Circuit affirmed a decision rendered by the U.S. District Court for the District of South Carolina, holding that the NLRB did not have the authority under the NLRA to promulgate the rule. The Fourth Circuit examined the plain language of the statutory text, which grants the NLRB the authority to issue rules that are "necessary to carry out" the provisions of the NLRA, and determined that the notice posting rule was not necessary to carry out any of the provisions of the NLRA. The Fourth Circuit observed that the NLRB "serves expressly reactive roles," such as conducting representation elections and resolving unfair labor practice charges, and that Congress did not intend to grant the NLRB the authority to take on a proactive role such as requiring employers to post a notice of employee rights under the NLRA.
The Fourth Circuit also noted that Congress explicitly included notice posting requirements in several federal employment and labor laws passed during the span of years from 1935 to 1974, such as Title VII of the Civil Rights Act, the Age Discrimination in Employment Act, and the Occupational Safety and Health Act, but did not include such a requirement in the NLRA despite the fact that the NLRA was amended in other ways three times during that time period. The Fourth Circuit stated that "Congress's continued exclusion of a notice-posting requirement from the NLRA, concomitant with its granting of such authority to other agencies, can fairly be considered deliberate. . . . Had Congress intended to grant the NLRB the power to require the posting of employee rights notices, it could have amended the NLRA to do so."
It remains to be seen whether the NLRB will ask the U.S. Supreme Court to consider this issue. Stay tuned for further developments on this blog.
The Office of Federal Contract Compliance Programs (“OFCCP”) recently posted a notice on its website informing federal contractors that they must begin to use the new 2006-2010 EEO Tabulation file as census data for all affirmative action plans commencing on or after January 1, 2014. The United States Census Bureau released the new data file to the public on November 29, 2012, which contains information on 488 occupations. This new data file replaces the Census 2000 Special EEO File that the OFCCP and covered contractors began using in January 2005.
OFCCP requires contractors, in determining availability estimates for their affirmative action plans, to “use the most current and discrete statistical information available.” Therefore, contractors are required to use the new 2010 EEO Tabulation to evaluate the reasonableness of all affirmative action plans commencing on or after January 1, 2014. Contractors may, however, immediately begin to use the 2010 EEO Tabulation in their affirmative action plans if they wish to do so.
On May 15, 2013, the U.S. Equal Employment Opportunity Commission ("EEOC") issued updated guidance documents on how the Americans with Disabilities Act ("ADA") applies to applicants and employees who have cancer, diabetes, epilepsy, and intellectual disabilities.
Each of the publications addresses the expansive definition of "disability" under the ADA Amendments Act ("ADAAA"), and provides that an individual with any one of the four specified conditions "should easily be found to have a disability" under the ADAAA. For instance, individuals with diabetes are substantially limited in the major life activity of endocrine function and individuals with cancer are substantially limited in the major life activity of normal cell growth. The publications also reiterate that because the determination of whether an impairment is a disability must be made without regard to the ameliorative effects of mitigating measures, diabetes is a disability even if insulin or some other medication controls a person's blood glucose levels.
The publications, which are provided in a Q&A format, include some general background information on each of the four specific disabilities and provide much of the same information in each guidance. The updated guidance documents provide employers with some important reminders. For example, an employer may not ask an applicant who has voluntarily disclosed that he/she has cancer or some other medical condition any follow-up questions about the disability, its treatment, or its prognosis unless the employer reasonably believes that the applicant will require an accommodation to perform the essential functions of the job. Thus, questions during the interview/application process should be focused on the requirements of the particular job, not the applicant’s medical condition. At the pre-offer stage, an employer is also prohibited from asking a third party (such as a job coach, family member, or social worker attending an interview with an applicant who has an intellectual disability) any questions that it would not be permitted to ask the applicant directly.
The publications also tackle issues such as: (1) when an employer may obtain medical information from applicants and employees; (2) when an employer may ask an applicant questions about his/her disability and potential reasonable accommodations; and (3) steps an employer should take to prevent and correct disability-based harassment. The publications refer employers who may be trying to identify reasonable accommodations for a specific disability to the website for the Job Accommodation Network ("JAN"), which provides information about many types of accommodations for various disabilities, including intellectual disabilities, diabetes, cancer, and epilepsy.
Finally, the publications address two notable issues concerning diabetes and epilepsy: (1) if another federal law prohibits an employer from hiring a person who uses insulin or who has had a seizure within a certain period of time for certain jobs, the employer will not be liable under the ADA for not hiring that individual, unless the other federal law includes an applicable waiver or exemption; and (2) employers are entitled to obtain periodic updates that an employee is still able to perform his/her job safely if the employee is in a safety-sensitive position.
