Sunday, August 17, 2008

Sick Pay To Remain A Benefit, Not Entitlement---For Now

Is sick pay an employee entitlement or a benefit? In California, a bill seeking to make sick pay an entitlement that all employers must provide has died in the Senate. But it will be back.

For details on the provisions of AB 2716, see our May 2008 summary here.

The bill died in the Senate because of budget constraints, noted Dean Calbreath, a San Diego Union Tribune columnist in a recent article. “The Schwarzenegger administration opposed the bill on the grounds that it would add costs to the state budget. The Department of Finance estimated that paying for the sick leave would add $600,000 to the budget, because the state would have to pay for sick leave for nurses who provide health care to elderly, blind and disabled patients in their homes.”

The cost to private employers would be much more. Although many employers offer sick pay as a benefit, most employers bristle at the thought of a state mandate requiring such pay. In a letter to the California Senate Appropriations Committee, the Cal Chamber of commerce wrote: “The ever-increasing burden of costly mandates on employers can cumulatively result in lower wages, reducing available health insurance, limiting training programs and - in the worst case scenario- job loss or reduced work hours. Job loss translates to lower tax revenues from employers and employees, as well as increased utilization of Unemployment Insurance. In an already troubled economy California should be seeking ways to stimulate job growth and avoid forcing costly mandates on employers.”

Supporters of the bill came up with all manner of public policy arguments. The pro-labor group Labor Project for Working Families argued in a fact sheet that employers should support the sick pay mandate because it would decrease employee turnover, increase productivity, and improve public health. 

The public health argument appeared to strike a chord with voters. The argument is that sick workers make more people sick. Korye Capozza, of the UC Berkeley Center for Labor Research and Education hypothesized in a policy brief that mandatory sick pay would improve decrease food poisoning and save the elderly. “AB 2716 would have clear benefits for individual workers but, importantly, it would also have public health benefits that extend beyond the household and workplace” wrote Capozza. “Specifically, such a policy could reduce the transmission of foodborne illness, decrease disease outbreaks in nursing homes, reduce the spread of infections in childcare settings and mitigate the transmission of seasonal influenza. There is also some evidence that paid sick leave influences workers’ decisions to see a doctor, parents’ decisions to stay home and care for a sick child and patients’ decisions about treatment choices. Finally, AB 2716 has the potential to improve patient compliance with preventive health-care guidelines and chronic care management, and thus to reduce health-care spending over the long term.”

Mandatory sick pay will be back. Assemblywoman Ma has vowed to reintroduce the bill next year. It is likely to gain public support. The California Center for Research on Women and Families, a program of the nonprofit Public Health Institute, publicized a public poll finding 73% of voters would support a law to guarantee that workers receive a minimum number of paid sick days from their employer.

Similarly, the poll found that 81% agree (57% strongly) that guaranteeing paid sick day laws to all restaurant workers who handle food would increase the chances that these workers would stay home when they get sick and not infect the public. Another 76% agree (50% strongly) that paid sick days should be considered a basic worker right, like being paid a decent wage.

The text to the most recent version of the bill can be found here.

Submitted By:
Christopher W. Olmsted
Barker Olmsted & Barnier APLC

Thursday, August 14, 2008

Cal Supreme Court Lets Stand Key Disability Ruling

The California Supreme Court denied a petition for review in a case titled Arteage v. Brink’s Incorporated, letting stand an appellate court ruling that circumscribed the definition of “disability” under California law.

Defining the term “disability” under California law is a very important issue, and California employers ought to pay careful attention to the definition. Unlike the federal ADA, California’s FEHA has a very broad definition of disability. Until the Arteaga appellate opinion, now left untouched by the California Supreme Court, courts have not focused much on whether particular physical conditions do or do not qualify as disabilities.

FEHA is explicitly and unabashedly liberal—it says so right in the text of the statute. As stated in the FEHA: “The law of this state contains broad definitions of physical disability, mental disability, and medical condition. It is the intent of the Legislature that the definitions of physical disability and mental disability be construed so that applicants and employees are protected from discrimination due to an actual or perceived physical or mental impairment that is disabling, potentially disabling, or perceived as disabling or potentially disabling.” “The provisions of [the FEHA] shall be construed liberally for the accomplishment of [its] purposes . . . .”

FEHA fulfills its liberal aspirations in the definition of “disability.” Under the FEHA, “physical disability” includes having a physiological disease, disorder, or condition that, by affecting the neurological or musculoskeletal body systems, special sense organs or skin, “limits” a “major life activity.” The key word is “limits.” It is very broad, and is contrasted with the federal ADA, which requires a “substantial” limitation. “Limits” is synonymous with making the achievement of a major life activity “difficult.”

Management attorneys and HR experts have long lamented this broad definition. They are heard to complain that just about any condition can make life difficult. They say that it is too easy to allege disability discrimination.

The appellate court in this case tackled the definition head on. The court began by considering what the “baseline” for “difficult” should be. “In deciding whether [the employees’] limitations . . . make them ‘disabled’ under FEHA, the proper comparative baseline is either the individual without the impairment in question or the average unimpaired person.”

For example, one could look at an employee with a 25 percent reduction of former capacity to lift, or an employee who lost approximately 50% of her pre-injury capacity for manual tasks. Additionally, one could look to the normal or average population. For example, in considering whether a disability caused difficulty with tasks such as dressing and sleeping, one can look to whether most people can perform those tasks without difficulty.

Turning to Arteaga, the appellate court examined his claim of pain symptoms. Arteaga did not have an actual disability while employed by Brink’s because his symptoms did not make the performance of his job duties difficult as compared to his unimpaired state or to a normal or average baseline.

By denying the petition for review, the California Supreme Court has given implicit approval of the appellate court’s disability definition. It is also notable that the Court denied a motion to “depublish” the lower court’s opinion. If the opinion had been depublished, it could not be cited as a precedent in future cases. The Supreme Court’s decision to preserve the precedential authority of the lower court opinion adds weight to the assumption that the Supreme Court approves of the opinion. 

For a more complete analysis of the appellate court decision, click here.

Submitted by
Christopher W. Olmsted
Barker Olmsted & Barnier, APLC

Friday, August 08, 2008

Well, Duh

From the New York Times: Study Finds Settling Is Better Than Going to Trial
Note to victims of accidents, medical malpractice, broken contracts and the like: When you sue, make a deal.

Week In Review (August 8, 2008)

Most Popular Federal Law Article

Department of Labor Issues Proposed FMLA Regulations.
On January 28, 2008, the Family Medical Leave Act (FMLA) was amended by the National Defense Authorization Act for Fiscal Year 2008 to provide up to 26 weeks of job protected family leave to care for injured members of the Armed Forces, and up to 12 weeks of leave because of a qualifying exigency arising out of an employee’s parent, child, or spouse’s active duty or call to active duty. Under the amendment, a maximum of 26 weeks of leave may be taken during a 12-month period for any combina tion of the FMLA-qualifying events. Then, on February 11, 2008, the Department of Labor (DOL) issued much-anticipated proposed regulations for implementing the FMLA. These rules, which seek to clarify existing regulations, were open for public comment for a 60-day period, but the comment period closed on April 11, 2008. Although the DOL has not summarized or published the comments to date, it plans to complete the review process and adopt the new regulations prior to January 2009, when President Bush leaves office. Additionally, although this release does not include specific proposals for implementing the new leave provisions for family members of military personnel, the DOL did seek public comments on such rules.
Located On: Baker, Donelson, Bearman, Caldwell & Berkowitz, PC

Most Popular State Law Article

Legal Changes for Employers (pdf)
Laws and sausages have something in common.
Located On: Jones Walker

Most Popular Headlines

Interview Questions: Legal or Illegal?
Workforce Management - August 04, 2008

Thursday, July 31, 2008

Department of Labor Opinion Examines Whether Restaurant Must Pay For Shoes

The Department of Labor has released a new opinion letter in which it examines a restaurateur’s policy specifying employee shoes.  The questions posed are: (1) Are the shoes part of a uniform, such that the employer must pay for them? (2) May the employer arrange for the purchase of the shoes and deduct the cost from the employee’s pay?

The DOL considered the following facts:

The Employer operates restaurants and requires employees to wear “dark-colored” shoes without prescribing any particular quality, brand, style, model, or type. Aside from color, the only other requirements are that they not be open-toed and that, for safety reasons, they not have a slippery sole. Employees may wear shoes they already own when hired or may purchase shoes from any vendor they may choose. Employees are free to wear the shoes outside of work.

The Employer has arranged a program through which employees may, solely at their option, purchase shoes from a shoe manufacturer. The manufacturer offers over 60 different slip-resistant shoes in a broad spectrum of styles and in numerous dark colors. If an employee chooses to purchase shoes from this vendor, the employee may either pay the vendor directly or the Employer will pay the vendor and deduct the amount of the payment from the employee’s paycheck over a number of weeks. In some instances, the deductions may cause the remaining amount of the employee’s paycheck to fall below the minimum wage for each hour worked during that pay period. If the employee requests that the Employer pay for the shoes through a deduction, the employee must do so by submitting a request in writing describing the shoes to be purchased, requesting the Employer pay for the shoes, and authorizing the Employer to withhold future wages in an amount sufficient to reimburse the purchase costs. Neither the Employer, nor any person acting in its interests, realizes any profit or other benefit from the purchase program,

The DOL opined that the footwear was not a uniform. Quoting its Field Operations Handbook the opinion letter states: “If an employer merely prescribes a general type of ordinary basic street clothing to be worn while working and permits variations in details of dress, the garments chosen by the employees would not be considered to be uniforms.” More restrictive policies may lead to the opposite conclusion. “[W]here the employer does prescribe a specific type and style of clothing to be worn at work, e.g. where a restaurant or hotel requires a tuxedo or a skirt and blouse or jacket of a specific or distinctive style, color, or quality, such clothing would be considered uniforms.”

The DOL also examined whether the Employer may offer to advance the money necessary for employees to voluntarily purchase shoes from the shoe manufacturer and recoup the advance through payroll deductions where those deductions may cause the employee’s paycheck to fall below the minimum wage for each hour worked in the pay period.

The DOL determined that such a practice was acceptable under the FLSA. The FLSA includes as part of “wages” the “reasonable cost” to the employer for furnishing any employee with board, lodging or other facilities. The DOL opined that the shoes qualified as “other facilities.” “[A] deduction for the actual cost of the shoes is allowed under [the FLSA], even if it reduces the amount of the employee’s cash wages below the minimum wage, so long as the employer does not profit or include any administrative costs.”

The DOL letter notes that the rule would be no different for tipped employees.

To review the DOL opinion letter, click here.

Submitted by:
Christopher W. Olmsted, Esq.
Barker Olmsted& Barnier, APLC

Friday, July 25, 2008

Week In Review (July 25, 2008)

Most Popular Federal Law Article

Election of Remedies Provision Does not Violate Title VII.
Creating a split among the federal appeals courts, the Second Circuit recently held that including an election of remedies provision in a collective bargaining agreement (CBA) is not unlawful retaliation in violation of Title VII. See Richardson v. Commission on Human Rights and Opportunities (July 7, 2008). The clause at issue in this case provided that disputes over unlawful discrimination would be subject to the CBA’s grievance procedure but would not be arbitrable if the employee filed a discrimination charge with the Commission on Human Rights and Opportunities (CHRO) (the state civil rights agency, who was also the employer in this case).
Located On: Ford & Harrison LLP

Most Popular State Law Article

New Hampshire Amends Overtime Law to Encompass Many Route Sales Drivers.
On July 9, 2008, New Hampshire enacted “An Act Relative to the Minimum Hourly Rate of Compensation.” This new law has significant implications for New Hampshire employers, as it broadens the scope of the state’s overtime requirement by eliminating the “motor carrier” exemption to New Hampshire’s overtime law for delivery drivers and sales merchandisers. The new law also revises the manner in which employers must calculate the overtime rate of pay for delivery drivers, sales merchandisers, and all employees paid on a salary and commission basis. The Act becomes effective on September 7, 2008.
Located On: Littler Mendelson, P.C.

Most Popular Headlines

Go Ahead, Insult the Boss (Everyone Will Be Doing It)
Journal Now - July 18, 2008

Thursday, July 24, 2008

EEOC Issues New Compliance Manual On Religious Discrimination

The U.S. Equal Employment Opportunity Commission (EEOC) issued a new Compliance Manual Section regarding workplace discrimination on the basis of religion on July 22, 2008.

The new section defines “religion,” religious discrimination and harassment under Title VII of the Civil Rights Act of 1964. It identifies discriminatory practices in the recruiting and hiring process, the terms and conditions of employment, and with respect to discipline and termination. The EEOC also describes its policies regarding the employer’s requirement to accommodate religious beliefs and practices.

The section explains how to apply the law to the workplace with numerous factual illustrations. For example, in explaining that accommodation does not necessarily mean acceding to the employee’s preference, the section states: “Tina, a newly hired part-time store cashier whose sincerely held religious belief is that she should refrain from work on Sunday as part of her Sabbath observance, asked her supervisor never to schedule her to work on Sundays.  Tina specifically asked to be scheduled to work Saturdays instead.  In response, her employer offered to allow her to work on Thursday, which she found inconvenient because she takes a college class on that day.  Even if Tina preferred a different schedule, the employer is not required to grant Tina’s preferred accommodation.”

To further assist employers, the EEOC also issued a companion question-and-answer fact sheet and best practices booklet.

The question-and-answer sheet includes answers to common questions, such as: “Does an employer have to grant every request for accommodation of a religious belief or practice?” “What if co-workers complain about an employee being granted an accommodation?” “What are common methods of religious accommodation in the workplace?”

The best practices booklet includes a number of compliance suggestions. Some of the suggestions are generic and obvious. For example: “Employers can reduce the risk of discriminatory employment decisions by establishing written objective criteria for evaluating candidates for hire or promotion and applying those criteria consistently to all candidates.” Other suggestions are more practical and helpful. For example: “Employers should consider adopting flexible leave and scheduling policies and procedures that will often allow employees to meet their religious and other personal needs. Such policies can reduce individual requests for exceptions. For example, some employers have policies allowing alternative work schedules and/or a certain number of ‘floating’ holidays for each employee. While such policies may not cover every eventuality and some individual accommodations may still be needed, the number of such individual accommodations may be substantially reduced.”

According to the EEOC’s press release, “the EEOC issued this section in response to an increase in charges of religious discrimination, increased religious diversity in the United States, and requests for guidance from stakeholders and agency personnel investigating and litigating claims of religious discrimination.”

The EEOC reports that religious discrimination charge filings with the EEOC nationwide have risen substantially over the past 15 years, doubling from 1,388 in Fiscal Year 1992 to a record level of 2,880 in FY 2007.

Submitted by:
Christopher W. Olmsted, Esq.
Barker Olmsted & Barnier, APLC
San Diego Employment Law Attorneys

Friday, July 18, 2008

Week In Review (July 18, 2008)

Most Popular Federal Law Article

Joint Commission Alert Targets Intimidating/Disruptive Behavior: Aims to Stamp Out the “Equal Opportunity Harasser”.
Recognizing that intimidating and disruptive behavior can compromise the delivery of quality healthcare, the Joint Commission on Accreditation of Healthcare Organizations (JCAHO) on July 9, 2008, issued a Sentinel Event Alert focusing upon its new requirements to address such behavior. The Sentinel Event Alert suggests what healthcare organizations must do to address all kinds of harassing and disruptive behavior, not just conduct made illegal under workplace discrimination and harassment laws.
Located On: Fisher & Phillips, LLP

Most Popular State Law Article

Missouri Enacts Tough New Immigration Law, Targets Employers.
Missouri Governor Matt Blunt has signed into law H.R. 1549, a stringent new bill targeting illegal immigration. As of January 1, 2009, employers of unauthorized workers will face potential loss of state contracts and/or tax breaks, suspension or even revocation of their right to do business in the state, and possibly a civil trial in Missouri state court.
Located On: Fisher & Phillips, LLP

Most Popular Headlines

Not Just a Ladies’ Room
Wall Street Journal (via Google) - July 15, 2008

Thursday, July 17, 2008

Wage and Hour Division Criticized

The U.S. Department of Labor’s Wage and Hour Division has failed to effectively enforce federal wage laws, according to a Government Accountability Office report issued on July 15th, 2008.

From fiscal years 1997 to 2007, the number of WHD’s enforcement actions decreased by more than a third, from approximately 47,000 in 1997 to just under 30,000 in 2007. The WHD defended the trend. It stated that it decided to enforce fewer, but more time-consuming comprehensive claims. It also states that the decrease resulted from more careful screening out of unmerited claims at the intake stage. WHD admits that part of the decrease is attributed to a 20% reduction in investigative staff.

The GAO found that the WHD rarely imposed statutory penalties on employers. WHD assessed penalties for 6 percent of the enforcement actions conducted between 2000 and 2007.

The GAO cited several examples where the WHD found violations of federal labor law, but failed to follow through with enforcement.

In one case, a homeless woman receiving free room and board while working as a night attendant at a nursing home alleged her employer had failed to pay her wages for an entire year. According to the WHD, the employer admitted it had failed to pay any wages to the night attendant and considered the room and board to be pay, but stated it did not have any money to pay the back wages. The WHD dropped the case and advised the night attendant of her right to file a private lawsuit. The employer was still in business as of June 2008.

An another case, the an employee alleged he was not paid for overtime. The WHD investigator did not perform any actions for 15 months citing a backlog of cases. Investigation was dropped after 15 months when the investigator saw a news article showing that the business in question had closed

The GAO further criticized the WHD for focusing on too narrow a range of industries. “WHD focused on the same industries from 1997 to 2007. The agency primarily targeted four industry groups: agriculture, accommodation and food services, manufacturing, and health care and social services.” The WHD did not react to information from its commissioned studies on low wage industries in which FLSA violations are likely to occur. The GAO concludes “WHD may not be addressing the needs of workers most vulnerable to FLSA violations.”

WHD’s data tracking hides its inefficiencies. “The extent to which WHD’s activities have improved FLSA compliance is unknown because WHD frequently changes both how it measures and how it reports on its performance,” reports the GAO.  “When agencies provide trend data in their performance reports, decision makers can compare current and past progress in meeting long-term goals.” WHD did just the opposite. “While WHD’s long-term goals and strategies generally remained the same from 1997 to 2007, WHD often changed how it measured its progress, keeping about 90 percent of its measures for 2 years or less.”

As quoted in the New York Times, a Labor Department press release highlighted the pay it has recovered for employees. Recovery of wages “more than doubled to $220,613,703 in 2007 from $96,719,108 in 1997.” The DOL said that 341,624 employees received back wages in 2007, up from 189,244 10 years earlier.” The DOL added: “The “Wage and Hour Division is delivering pay for workers, not a payday for trial lawyers.”

To view the GAO reports, click here and here.

To view the New York Times article, click here.

Submitted by:
Christopher W. Olmsted, Esq.
Barker Olmsted & Barnier, APLC

Friday, July 11, 2008

Week In Review (July 11, 2008)

Most Popular Federal Law Article

Education Labor Letter: New Requirements for 403(b) Plans.
403(b) plans are tax-qualified retirement plans maintained only by nonprofit organizations and public school systems. Plan assets are invested in annuity contracts or custodial accounts instead of a tax-exempt trust, like 401(k) plan assets. Historically, 403(b) plans were subject to very little regulation by the IRS and DOL.
Located On: Fisher & Phillips, LLP

Most Popular State Law Article

How Does California’s Same-Sex Marriage Decision Impact Employers?
As most affected employers are aware, California recently became the second state (after Massachusetts) to recognize same-sex marriages. In In re Marriage Cases, the California Supreme Court held that denying same-sex couples the right to marry violates the California Constitution’s equal protection clause and is a form of unconstitutional discrimination based on sexual orientation. The law also invalidated California’s Proposition 22, which provides that only a marriage between a man and a woman is recognized in California.
Located On: Ford & Harrison LLP

Most Popular Headlines

What job interviewers shouldn’t ask
Star Telegram - July 07, 2008

Thursday, July 10, 2008

CA Labor Commissioner Cites Company For Not Providing Lactation Accommodation To Employee

In 2002, the California legislature amended the Labor Code to mandate that employers provide “lactation accommodation.” Yes, we cover it all here in the Golden State. In the six years following enactment of the law, no known enforcement actions had been initiated. Hopefully the reason is because employers have been complying with the law. 

Apparently at least one employer did not take note of the law. The California Labor Commissioner, Angela Bradstreet, has announced the issuance of a citation to a Santa Clara-based International Security Services, Inc. for failing to provide private accommodations for an employee to express breast milk for her newborn.  The citation is the first of its kind since the law took effect in 2002. A fine of $4,000 has been assessed.

“Under the law, employers are obligated to accommodate employees who wish to provide breast milk for their infant children,” Bradstreet said. “This employer failed to provide a reasonable amount of break time and a private room for an employee to express milk for her baby as required.”

The labor commissioner received a complaint—the first lodged as a result of the 2002 legislation—from the employee on March 4, which prompted an investigation. The investigation revealed that the employee was not provided an appropriate, designated room. Initially the room that was provided was computer server room with security cameras. This offered an inadequate level of privacy needed to perform the milk expressing process.

Labor Code sections 1030-1033 became law in 2001 and mandates every employer, regardless of size, to provide a reasonable amount of time to accommodate expressing of breast milk and to make reasonable efforts to provide the employee with the use of a room or other location, other than a bathroom, in close proximity to the employees work area to express milk in private.

Bradstreet urged women who are not being provided appropriate accommodations for milk expressing to contact her office and file a complaint.

“This is not the type of law that we can address with enforcement sweeps and filing a complaint is important so that we can correct the violation and educate the employer,” added Bradstreet.

Find the press release here.

Posted by:
Christopher W. Olmsted
Barker Olmsted & Barnier, APLC

Friday, June 27, 2008

Week In Review (June 27, 2008)

Most Popular Federal Law Article

Supreme Court Rules That Plaintiffs May Use Section 1981 to Sue for Retaliation.
On May 27, 2008, the U.S. Supreme Court held in CBOCS West, Inc. v. Humphries, (No. 06-1431), that employees may bring claims based on or arising from retaliation under 42 U.S.C. § 1981. Section 1981, one of a number of federal laws addressing discrimination, provides that “[a]ll persons . . . have the same right . . . to make and enforce contracts . . . as is enjoyed by white citizens.” Although the text of the statute does not specifically mention retaliation, the Court held that Section 1981 nevertheless encompasses retaliation claims.
Located On: Hogan & Hartson LLP

Most Popular State Law Article

D.C. Passes the Accrued Sick and Safe Leave Act of 2008.
Washington, D.C. has become the second city, after San Francisco, to pass a law that requires employers to provide paid sick leave to all employees. After significant amendment including input from the employer community, the Accrued Sick and Safe Leave Act of 2008 was passed by the D.C. Council in March. Following approval by Mayor Adrian Fenty and a 30-day review process by Congress, the Act was approved on May 13, 2008. Effective November 13, 2008, mandatory sick leave provisions will apply to even the smallest employers.
Located On: Littler Mendelson, P.C.

Most Popular Headlines

8 Big Mistakes You Could Be Making At Work

Wednesday, June 25, 2008

IRS Increases Mileage Rates Due To Gas Prices

On June 23rd the Internal Revenue Service announced an increase in the standard mileage rates for the final six months of 2008.

The rate will increase to 58.5 cents a mile for all business miles driven from July 1, 2008, through Dec. 31, 2008. This is an increase of eight (8) cents from the 50.5 cent rate in effect for the first six months of 2008.

The IRS announced the unusual mid-year increase in recognition of recent gasoline price increases. The IRS normally updates the mileage rates once a year in the fall for the next calendar year.

“Rising gas prices are having a major impact on individual Americans. Given the increase in prices, the IRS is adjusting the standard mileage rates to better reflect the real cost of operating an automobile,” said IRS Commissioner Doug Shulman. “We want the reimbursement rate to be fair to taxpayers.”

While gasoline is a significant factor in the mileage figure, other items enter into the calculation of mileage rates, such as depreciation and insurance and other fixed and variable costs.

The optional business standard mileage rate is used to compute the deductible costs of operating an automobile for business use in lieu of tracking actual costs. This rate is also used as a benchmark by the federal government and many businesses to reimburse their employees for mileage.

To view the IRS announcement, click here: IRS News Release

Employers should consider increasing the reimbursement rates to match the new IRS rate. Generally, employers must reimburse employees for travel expenses incurred in the course of work. For example, in California, Labor Code section 2802, subdivision (a), requires an employer to indemnify its employees for expenses they necessarily incur in the discharge of their duties. Note that in California, paying the IRS rate does not guarantee that the employer has fully reimbursed the employee for actual travel expenses. The California Supreme Court recently addressed employee travel expense reimbursement in a case titled Gattuso v. Harte-Hanks Shopper, Inc.

Submitted by:
Christopher W. Olmsted, Esq.
Barker Olmsted & Barnier, APLC
San Diego Employment Law Attorneys

Friday, June 20, 2008

Week In Review (June 20, 2008)

Most Popular Federal Law Article

Supreme Court Rules That Plaintiffs May Use Section 1981 to Sue for Retaliation.
On May 27, 2008, the U.S. Supreme Court held in CBOCS West, Inc. v. Humphries, (No. 06-1431), that employees may bring claims based on or arising from retaliation under 42 U.S.C. § 1981. Section 1981, one of a number of federal laws addressing discrimination, provides that “[a]ll persons . . . have the same right . . . to make and enforce contracts . . . as is enjoyed by white citizens.” Although the text of the statute does not specifically mention retaliation, the Court held that Section 1981 nevertheless encompasses retaliation claims.
Located On: Hogan & Hartson LLP

Most Popular State Law Article

D.C. Passes the Accrued Sick and Safe Leave Act of 2008.
Washington, D.C. has become the second city, after San Francisco, to pass a law that requires employers to provide paid sick leave to all employees. After significant amendment including input from the employer community, the Accrued Sick and Safe Leave Act of 2008 was passed by the D.C. Council in March. Following approval by Mayor Adrian Fenty and a 30-day review process by Congress, the Act was approved on May 13, 2008. Effective November 13, 2008, mandatory sick leave provisions will apply to even the smallest employers.
Located On: Littler Mendelson, P.C.

Most Popular Headlines

Your boss shouldn’t read your text or e-mail messages without an OK, court says
LA Times (Registration Required) - June 19, 2008

Review of Employee Text Messages Deemed Invasion of Privacy

Workplace privacy rights can be tricky. Consider the following scenario: A company provides two-way alpha-numeric pagers to employees. The pager service plan allows for transmission of 25,000 characters per month, beyond which an overage fee is assessed. Employees are told to use the pagers for business purposes, and that they will have to reimburse the company for overage fees on account of personal use. A company policy warns employees that it may monitor electronic communications.

There are overages, but the employees do pay for them. But the company decides to conduct an audit because (1) it wants to make sure that employees are not asked to pay overage fees for business transmissions; (2) it wants to assess whether 25,000 characters per month is an efficient limit. To conduct the audit, the company prints and reviews transcripts of the text messages. Does the company act within its rights?

No, according to a Ninth Circuit Court of Appeals, in a case titled Quon v. Arch Wireless. The case involved the Ontario Police Department’s review of text messages sent and received by police Sgt. Jeff Quon. The audited text messages included personal communications, including sexually explicit comments. Quon and others he texted sued the Department for violations of constitutional privacy rights. The trial court ruled against the employees, but the Ninth Circuit reinstated the case.

The court reasoned as follows:

(1) Employees may have constitutionally-based reasonable expectations of privacy in the workplace. This includes the expectation that employers will not monitor private communications. 

(2) Employers may dispel the expectation of privacy by warning employees that communications may be monitored. Like many employers, the Department had a “Computer Usage, Internet and E-mail Policy.” The policy limited use of electronic devices to Department business, and advised employees that the Department may monitor employee use of the systems, and that users should have no expectation of privacy.

(3) However, the “operational reality” was different. In practice, the manager responsible for the pagers told employees that he would not audit pager messages as long as employees paid for overage fees. They paid the fees, and therefore it was reasonable for them to expect that the Department would not monitor their communications. So the practice defeated the policy. The court suggested that the policy would have been sufficient to dispel the expectation of privacy, but for the manager’s assurances and practices to the contrary.

(4) Because the employees had a reasonable expectation of privacy in connection with the text messages, intrusion by the employer must be reasonable--but here it was not reasonable. Employers are permitted, during the course of workplace misconduct investigations, or for other business purposes, to review or monitor employee communications--but the employer must demonstrate that the intrusion is reasonable. “"Reasonable" means there was a reasonable basis for conducting the search, and that the scope of the search (or the degree of intrusiveness) was reasonable. The court determined that the Department could have used less intrusive means. It could have, for example, looked at the number dialed without reading the text. Or it could have asked the employees to black out personal messages before reviewing the transcript. 

Note that the decision was made in the context of a public employer, but employee rights in private industry may be affected by this decision. The court examined the federal Fourth Amendment as well as California’s constitutional privacy rights. The Fourth Amendment applies to government action—here the police department was the government entity.  But the California constitution applies to public and private employers alike.

Constitutional privacy rights in the private sector have not been well defined by the courts. You can expect further developments in area of workplace privacy rights, particularly given technological advances that make employee monitoring increasingly easy. 

Submitted by:
Christopher W. Olmsted
Barker Olmsted & Barnier, APLC