Both General Contractors and Subs Liable to Unpaid Workers, April 30, 2002
by Thomas A. Bowden
Both contractors and subcontractors are liable to unpaid workers on public contracts, thanks to a law signed by Maryland Governor Parris Glendening on April 25.
Previously, the statute (Section 17-222 of the State Finance and Procurement Article) provided that the contractor *or* the sub must make restitution for any shortfall. Now, the statute will hold the contractor and sub "jointly and severally liable," which means that both stay on the hook until the employee is paid.
The same statute provides for liquidated damages of $20 per day per laborer when the worker receives less than the prevailing wage rate, or when a laborer is paid less than a mechanic's prevailing wage while performing a task required to be performed by a mechanic or apprentice.
Employee Properly Fired for Suing Employer's Customer (Patient), April 22, 2002
Many states prohibit the firing of an at-will employee for reasons that "violate public policy." For example, it is generally recognized that firing an employee for refusing to perjure himself in court would violate public policy. Some states have ruled that employees cannot be fired for filing a worker's compensation claim, reporting an employer's illegal behavior to a government agency, or refusing to violate the law.
A court in California has ruled that even though individuals may have a right to bring a lawsuit, they can be fired by their employer for bringing a lawsuit against one of the employer's customers, in this case a patient of the employer-hospital. Jersey v. John Muir Medical Center, No. A093521 (Cal. Ct. App., April 16, 2002). While there may be a public policy in favor of allowing employees to sue people who hurt them on the job, the court found that the employer's interest in not having its customers, clients, or patients sued by its employees overrode that potential policy.
Women Call For Passage of Fair Pay Act and Paycheck Fairness Act, April 22, 2002
According to the U.S. Census Bureau, in 2000, the average American woman earned 73 cents for every dollar a man earned. In a demand for equal pay of men and women, members of Congress and women's rights activists gathered in Washington on April 16, 2002, to call for the passage of the Fair Pay Act (H.R. 1362, S. 684) and the Paycheck Fairness Act (H.R. 781, S. 77), which have been stalled in Congress for several years.
The Paycheck Fairness Act, sponsored by Rep. Rosa L. DeLauro (D. Conn.), is designed to strengthen penalties for equal pay violations; allow for compensatory and punitive damages; and authorize class action equal pay suits. The Fair Pay Act is drafted to prohibit wage discrimination based on sex, race, and national origin; ban retaliation against workers who challenge pay practices or seek to disclose wage information; and require employers to file wage information annually with the EEOC.
Alleged Youth-Oriented Policy Keeps Age Bias Case Alive, April 18, 2002
by Thomas A. Bowden
If you're an insurance company hiring a lot of sales agents from college campuses, you might conclude that the new agents would be happier if their managers were closer to college age themselves. A recent age bias case centered on the allegation that just such a policy was put in place at Prudential Insurance Company, resulting in discrimination against older managers.
The plaintiff was a 45-year-old sales manager who says he was squeezed out by this youth-oriented policy. He sued under the Age Discrimination in Employment Act, seeking money damages. Whether the age-oriented policy actually existed or not (and everybody but the plaintiff says it didn't), the allegation alone was enough to keep the case alive in an Illinois federal court. Beard v. Prudential Ins. Co. of Am., No. 00-C-3874 (N.D. Ill. Apr. 8, 2002).
OSHA Ergonomic Standards: Voluntary or Mandatory? April 17, 2002
by Thomas A. Bowden
Even though proposed OSHA regulations governing ergonomic injuries were overturned a year ago, OSHA intends to enforce ergonomic standards anyway. The agency will cite employers under the "general duty" clause, which requires employers to eliminate "recognized serious hazards."
How will an employer know what hazards to eliminate? OSHA announced it will be issuing industry-specific guidelines in the fall of 2002, adding to the existing body of literature on the subject of so-called "musculoskeletal disorders." Although OSHA says observance of the guidelines is voluntary, OSHA reserves the right to issue citations under the "general duty" clause to employers who fail to implement them. But if an employer *does* implement the "voluntary" guidelines, no citation will be issued.
So, what are touted as voluntary guidelines are edging suspiciously close to becoming mandatory. Employers in industries targeted for enforcement in the area of ergonomic injuries should be especially wary.
Offhand "Million Dollar Bonus" Comment Unenforceable as Contract, April 17, 2002
When the owner of a radio station reassured his station manager that if he ever sold the station the manager would "get a million dollars," the manager took the comment seriously; so seriously that he sued to recover the bonus after the station was sold. The Fourth Circuit disagreed with the manager and considered the owner's statement a casual reassurance that the manager and others would gain in the unlikely event that the station was sold.
The Court also observed that there were no words suggesting a formal offer, no acceptance, and no consideration. Further, the "promise" was never put in writing while less extraordinary promises were, and company policy dictated that all employment agreements be in writing. The Court also remarked that the manager only raised the issue of the $1 million bonus after the station was sold - after he accepted a $5,000 bonus and $50,000 in severance payments. McCarthy v. Kylberg, No. 01-1248 (4th Cir. Mar. 13, 2002).
Family and Medical Leave Act Report, April 12, 2002
At a congressional hearing yesterday, it was reported that 11 different regulations of the FMLA have been challenged in federal court, and more are expected. As reported here (March 20 Quick Clip), one such regulation was struck down by the Supreme Court. The House Government Reform Committee was told that the Department of Labor needs to revise its regulations to resolve these challenges and prevent future ones.
The FMLA applies to employers with 50 or more employees. It was originally intended to allow employees to take leave for childbirth, serious illness, or family medical emergencies. It was not intended to be a hammer to hit employers over the head. For example, the definition of "serious health condition" in the regulations is particularly vague.
If you have 50 or more employees, review your policy and procedures to ensure that you are properly treating leave under the FMLA. Check this site regularly to see how those court challenges are affecting your policy and procedures.
Activated Vibrator at Work Causes Emotional Distress, April 11, 2002
Plaintiff Elizabeth Brooks worked as a hostess at Denny's Restaurant in Allentown, Pennsylvania. At the end of her shift one day, she approached manager Christian Mendoza and asked him to punch her time card. As she made this request, her manager showed her a vibrator. She told him that he was "really sick," and started to walk away. Mendoza called her back, pushed the object in his pocket and "started buzzing it on himself." Brooks started to cry and walk away again, but Mendoza followed her around the restaurant.
The following day, Brooks reported the incident to a district manager who offered her the opportunity to transfer to another store. She refused the transfer and was fired several months later.
She filed a complaint, alleging she suffered severe emotional distress as a result of Mendoza's acts. Mendoza denied the accusation, claiming instead, that he had a portable back massager in his front pants pocket and it became activated when he propped his leg up.
The United States District Court for the Eastern District of Pennsylvania ruled that although Pennsylvania's workers' compensation law preempts all claims for injuries occurring during the course of employment, emotional distress claims are not preempted because Brooks' alleged injury was caused by the intentional conduct of a third party, for personal reasons. The court held that Mendoza's acts were personal and nature and fit within the personal animus exemption of Pennsylvania's workers compensation law. As a result, Brooks is permitted to proceed against Mendoza and Denny's in federal court for intentional infliction of emotional distress. See Brooks v. Mendoza, No. 00-5045 (E.D. Pa, Mar. 25, 2002).
Eat Up New Jersey - - You're Protected, April 4, 2002
In a case of first impression, the New Jersey Supreme Court held that obesity constitutes a handicap under the New Jersey Law Against Discrimination (LAD). Viscik v. Fowler Equip. Co., No. 51855 (N.J., Mar. 28, 2002).
During the four days of her employment, 400-pound billing clerk Regina Viscik was observed having difficulty standing while being trained by a co-worker. Her supervisor believed that her inability to maneuver around the office and stand for certain periods of time made her an inefficient and ineffective employee. Viscik argued that the discharge was in violation of the LAD because of her obesity. She presented expert testimony from her doctors who explained that she was diagnosed with "morbid obesity," a disease that occurs when a person has a medical illness or illnesses that result from obesity. Viscki suffered from obesity-based arthritis, heart condition and obstructive lung disease that the court determined were clearly physical infirmities.
The court concluded that her disease constituted a handicap within the meaning of the LAD because she could not perform tasks that normal people could. A new trial has been ordered because of a flawed jury instruction.
Supreme Court Dismisses ADEA Disparate Impact Claim, April 2, 2002
Employment lawyers and human resource professionals across the country were surprised yesterday by the Supreme Court’s dismissal of a case that raises the question of whether disparate impact claims are available under the federal statute prohibiting discrimination against employees age forty or over. The dismissal of Adams v. Florida Power Corp., is important because it leaves unsettled the split among courts as to whether employers can be held liable under the Age Discrimination in Employment Act (ADEA) for decisions having an adverse impact on individuals forty or over.
Sometime in the mid-1990s, Florida Power Corporation implemented several reductions in force (RIFs). A group of 117 workers 40 or over challenged the legality of the RIFs. According to the workers, Florida Power’s RIFs were illegal because over 70 percent of the workers selected for discharge were 40 or over. The U.S. Court of Appeals for the 11th Circuit ruled against the employees and held that disparate impact claims may not be brought under the ADEA. The Supreme Court dismissed the case and thus let the decision of the Appeals Court stand.
The Supreme Court’s decision to dismiss is especially frustrating for employers that operate in different states because courts across the country are split on the issue and employers, depending on their geographic location, are left unsure of their obligations. Some courts for example differ with the Adams court and follow the view of the Equal Employment Opportunity Commission (EEOC). The EEOC has opined that disparate impact claims are allowable under the ADEA because the ADEA contains nearly identical language to that found in Title VII of the1964 Civil Rights Act. Disparate impact claims are allowed under Title VII.
Layoffs and RIFs are sometimes necessities in today’s period of economic uncertainty to ensure corporate survival. Employers should be aware of the potential impact of discharges in these circumstances. In addition to ensuring compliance with the notification requirements of the Worker Adjustment and Retraining and Notification Act (WARN), employers, depending on their location, may have to analyze their actions to ensure that there is not an adverse impact on employees forty or over.
Arbitrator's Decision Overturned For Ignoring Contract Language, April 2, 2002
In Anheuser-Busch Inc. v. International Bhd. Of Teamsters, Local 744, 169 LRRM (BNA) 2513 (7th Cir. Feb. 15, 2002), the Seventh Circuit overturned an arbitrator's decision that failed to consider the language in the collective bargaining agreement. The agreement provided for two commission rates for drivers - a higher rate for drivers who worked alone and a lower rate for drivers who worked with a helper.
The company's practice, however, ignored the agreement and paid all drivers the same rate, whether the driver worked alone or with a helper. In 1998, the company announced that it would begin paying commissions according to the agreement. The union filed a grievance, and an arbitrator found in its favor.
On appeal, the Seventh Circuit determined that the arbitrator exceeded his authority by allowing a practice to supersede the written language in the agreement. The court pointed out that the contract contained two important clauses. First, the agreement had a "zipper clause" which stated that the written language took precedent over any prior agreements or practices not "specifically preserved in the contract." The second clause specifically deprived an arbitrator of authority "to add to, subtract from, modify, or change" any contract term. Instead of merely misinterpreting the agreement, the court concluded that the arbitrator "disregarded the very language of the agreement."
Accessing Employer's Files Warrants Termination, April 2, 2002
Imagine that an employee comes into work one day and shoots her co-worker. She is terminated by her employer, but her union brings a grievance arguing that because the collective bargaining agreement did not contain a specific provision against shooting a co-worker, her termination was unjustified.
A similar argument was used by the union in defense of an employee who accessed his employer's private and confidential files. Hoosier Energy Rural Electric Cooperative, Inc. learned that one of its employees was accessing files for approximately eight months, spending six to eight hours a week doing so, had downloaded copies of some of the files, and shared them with co-workers. After discharging him, the union brought a grievance, claiming that there was no rule prohibiting the employee's conduct.
Arbitrator Hyman Cohen denied the grievance, holding that the employee "engaged in a serious misuse of the computer while at work," and that "accessing such documentation serves no interest of the Labor Agreement; nor does it serve the collective bargaining relationship between the parties." Hoosier Energy Rural Elec. Coop., Inc., 116 LA 1043. Arbitrator Cohen concluded that as a matter of common sense, the employee should have known that (a) attempting to access to the company's computer files was not reasonably related to his job duties; (b) that he was engaged in improper conduct; and (c)it was improper to access the company's payroll records.
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