Ed. Note: So, other L&E bloggers I follow have special Friday things that they post, like roundups of what they read, I think for the express purpose of not giving readers anything too taxing right before the weekend. Not having to worry about “readers” per se, and not feeling any compelling need to post the rest of the week, that part of the special Friday post is lost on me. Nonetheless, I am jealous of all of them for myriad reasons, so I’m stealing the idea. As I’ve said before, one of the influences for this blog was Gary Skoning‘s “Wackiest Employment Law Cases” series. I figured the regular Friday post would be a great way to pay homage to that tradition, so from now on, every Friday I’m going to link to the most ridiculous L&E-related story I’ve read this week. I’m calling it WTFriday. Clever, right? Okay, here goes:
If you poll a few labor & employment attorneys about what industry has the most L&E sketchiness, one of them is bound to say themselves. Not themselves specifically, but lawyers, as a group. We are the worst.
Don’t believe me? I had a friend from law school that went on three interviews in a month, two small firms and a slightly bigger operation, and all three of them asked her if she was planning on having babies anytime soon.
So, from the “Shouldn’t We Know Better” Desk comes this headline in the ABA Journal:
Yeah. You read that right. Apparently the prominent Chicago class action attorney (whose name you cannot read here, but is certainly available in the article) is facing a couple of lawsuits for trying to “work out a deal” with some of his female employees, and other totally normal successful-attorney-type behavior like taking off his pants at work.
The attorney says that the employee is raising false allegations because she was recently asked to look for another job.
Happy WTFriday, everybody.
If you’re in the Chicago-area, especially in the western suburbs, I will be conducting a seminar for the West Suburban Chamber of Commerce & Industry on July 15 entitled “Hiring and Managing Employees in the Age of Social Media”. The info is below.
We’ll be discussing the basics of social media policies and what to do when an employee misuses social media, the NLRB’s facebook firing push, and how you can and can’t use SM to screen applicants and employees. There will also be a Q&A at the end, so bring your questions. Hope to see you there!
And if you are an employer in the Western Suburbs, check out WSCCI. They are a great resource and connection point for businesses in the area.
“Hiring & Managing Employees in the Age of Social Media”
July 15, 2011
7:50 – 9:00 am
WSCCI Chamber Offices, 9440 Joliet Road, Suite B, Hodgkins (East doors of the Republic Bank building)
Please RSVP to Kristen at email@example.com or call 708-387-7550.
I say “You” because this is a blog – and that means I have super fancy internet magic that shows me who reads this stuff I write, and I can tell you that massive corporations make up about .001% of my ego-killing-ly meager audience.
So this post is to the small businesses, sole proprietorships and freelancers that do read this blog with some regularity (and thank you for it, by the way). I know you all got blasted from your corp lawyers and your local chambers of commerce and your aunts on Facebook telling you about the Supreme Court’s business-friendly stance in Dukes v. Wal-Mart, and how it was such good news for companies in this struggling economy and so on. And I know it’s been tough to gauge where the SCOTUS stood on employment issues for a while, and this case was all about discrimination law, so it seems like a good sign and you guys are probably feeling really good about it and everything. So forgive me for playing with your emotions a little, but this next statement is going to be something of a roller coaster. Just bear with me…
What does the Dukes v. Wal-Mart decision mean for you, small business owner? Nuthin.
Seriously – not a damned thing. If you employ one to one hundred employees, I cannot imagine any scenario by which the Dukes decision will ever have an effect on your business, even if every one of your employees sued the pants off of you at the same time.
But you know what? That’s good. Really good. No, seriously. In a million ways, you do not want the Dukes decision to have any effect on your business.
As expected, the Supreme Court handed down a rejection of the 1.5-million-member class action against Wal-Mart today.
If you have been doing the labor & employment equivalent of living under a rock The case, Dukes v. Wal-Mart, alleged that Wal-Mart’s pay and promotion policies discriminated against women because of their sex. A handful of current and former women sued the Company on behalf of all women employees from 1998 to the present.
The District Court and the 9th Circuit Court of Appeals had both approved of the class, and a splintered en banc review of the case by the 9th Circuit left it standing, as well. But the Supreme Court knocked it down unanimously. The four most liberal justices joined in a partial dissent, but all the justices agreed that the enormous putative class lacked the commonality required to bring a single lawsuit against their collective employer.
I will put together a big post about the ruling (maybe a few – this is one of those cases you have to “unpack” a little), but here’s the gist, from my initial reading:
News came yesterday that Walmart lost its appeal of a $187.6 Million verdict in a Pennsylvania wage & hour case originally tried back in 2006. The suit alleged that 187,000 workers were denied their right to rest and lunch breaks under Pennsylvania state law. The case was notable because Walmart attempted to distance itself from its own documentation of time records for its PA employees, claiming that the timesheets were too faulty to be trusted.
The Plaintiffs argued that local managers were under ever-increasing pressure to cut costs, resulting in chronic understaffing that led some workers to work through their breaks, whether or not they were still on the clock. Walmart claimed the records that showed when employees punched in or out were too inaccurate to be used as legal evidence.
The Pennsylvania Superior Court apparently wasn’t thrilled with the argument, noting that the company’s own internal investigations had revealed illegal “off-the-clock” work. According to the Plaintiff’s Attorney’s press release, Walmart also tried to argue that it had been denied due process because the trial court refused to let it question each individual class member regarding their hours worked.
It wasn’t a total loss, though – the Court said that some of the plaintiff’s attorney’s fees were counted twice, and would have to be recalculated. That’s a drop in the bucket compared the the verdict and add-on penalties levied against the company. For a great breakdown of how the Pennsylvania Wage Payment and Collection Law turned a $49 Million verdict into $187 Million payout, see Phillip K. Miles’s Lawffice Space post here.
A Walmart spokesman said they are looking forward to further appeal.
All the while, the world is waiting with bated breath to see what the Supreme Court has to say about Dukes v. Wal-Mart, the biggest wage-and-hour class action ever, which finally made its way to Washington. Though it is on the tip of every employment lawyer’s tongue, the question before SCOTUS doesn’t have that much to do with the wages or hours of Walmart employees, and everything to do with the nature and future of class actions in American jurisprudence.
The question before the Court is not whether Walmart violated any wage laws, but whether a class of this size – all women who worked for Walmart between 1998 and now – is really ever fair. Walmart is arguing that it is impossible for every women it’s employed for the past 13 years to have enough in common to be certified as a single class.
Oral arguments in that case are over (and seemed to go well for the retailer), and the decision is expected early this summer.
A couple of stories about employee harassment complaints came across my computer screen today, and provide a perfect illustration of just how important an employer’s response is in these situations.
First, Jon Hyman at the Ohio Employer’s Law Blog noted a $95 Million verdict in a single-plaintiff harassment case – probably the largest award ever received by a single employee plaintiff.
The facts in Alford v. Aaron Rents, Inc. are horrendous and gross. Not long after Ashley Alford started working for Aaron’s, her supervisor began making sexual advances toward her and giving her inappropriate nicknames. She called the company’s harassment hotline and never heard back. By the time she involved the police – more than a year later – saying the harassment escalated doesn’t really do it justice. She had been sexually accosted in the most degrading and deplorable manner I’ve ever seen in an employment case.
In deciding on damages, the jury was informed that Aaron’s made a $118 Million profit last year. That means that a jury decided that Ashley Alford deserved 80% of the money Aaron’s made in 2010.
The Test Case
Compare this story with the one delivered today by Business Management Daily about a female custodian at Xerox. Donna Johnson was cleaning a men’s restroom when another employee entered – ignoring the janitorial sign posted outside the door – and began using a urinal. She made some exclamation, and the male employee said that the janitors in Europe just ignored him and went about their business. Johnson left the bathroom and complained to HR.
Xerox responded by immediately counseling the world traveler on the meaning of “closed for cleaning” and transferring Johnson to a different post. When Johnson sued anyway, the court threw the case out saying that Xerox did everything right under the circumstances.
If I’d just told you about the Xerox case, I know a lot of you would probably think they went a little overboard investigating a sexual harassment complaint based on a man using a urinal. And even more of you are probably calling BS on me comparing the facts of these two cases at all. One of them is horrendous, the other seems relatively innocuous. But look at the Aaron’s case again. It didn’t start out as blatant sexual abuse. It started out as bad-but-not-extraordinary harassment. Maybe even actions that could be “misconstrued” as harassment when “I didn’t mean anything by it.” Sort of like walking into a toilet when you know a lady’s in there cleaning.
The point is – you as a business person do not know the difference between a simple error in judgment and the first signs of a dangerous proclivity. I do employment law, and I don’t even know the difference. That’s why every allegation of sexual harassment – every single one - has to be investigated quickly and taken seriously. It may not end in discipline or even counseling. It may not involve relocating workers. But employees need to feel like their companies are protecting them from what they see as bad behavior.
And so do the courts. The BMD story points out that even though the Xerox case doesn’t really smack of harassment, the employee still sued. If Xerox hadn’t acted as it did, that seemingly-frivolous lawsuit would still be costing the company real money – in attorney’s fees and settlement payments.
If Ashley Alford had received an appropriate response from Aaron’s harassment hotline, would she have been spared from the horrible things that eventually happened to her? Nobody knows. But if she had, and her supervisor had been disciplined early on, somebody would probably say they were too touchy about harassment and needed to lighten up.
I’ll take a little criticism that I’m too tough on harassment complaints if it means I get to keep $95 million in the bank.
A couple of days ago, the Chicago Chapter of LERA sponsored a talk with Lafe Solomon, Acting General Counsel of the NLRB. The audience was a collection of labor leaders and attorneys, management attorneys, arbitrators, professors and students, so you can imagine how broad the Q&A got.
Along with Board Chairman Wilma Liebman, Solomon has been on something of a defense tour the past few months, ever since the House Education & Workforce Committee held hearings on “Emerging Trends at the National Labor Relations Board” back in February – a title that sounds much more innocuous than it actually was. The purpose of the hearings was to show how activism and labor-friendly policies had overtaken the neutrality the NLRB was supposed to exude, and how the “Obama Board” was fundamentally changing the NLRB into a government-sponsored tool of Big Labor. Solomon and Liebman both issued statements to the Committee which made, essentially, two points: (1) We inhereted most of the problems we’re being accused of pushing through; and (2) this is how the NLRB works, and nothing about what we’re doing is all that crazy.
After seeing Solomon speak, and respond to questions from that disparate audience, I think I can safely say that the truth is, of course, somewhere in the middle. Below is sort of a “quick hits” version of Solomon’s comments on some of the hot-button issues at the NLRB at present.
If you haven’t heard, the NLRB recently filed a Complaint against Boeing for locating a second production line for its 787 Dreamliner in a non-union facility in South Carolina instead of the Puget Sound locale that comes with the baggage of the Machinists & Aeorspace Workers. The GC’s office got a lot of blowback from South Carolina politicos and from manufacturing groups, who said the filing was politically motivated, pushed by the Machinists, and an unprecedented step to extend labor protection to economic business decisions before they affect any unionized employees. Solomon issued a response that basically said Let’s not talk about this thing in public, huh? I’m trying to settle this behemoth. Crazy, said Shopfloor, since the NLRB has PR’d the hell out of this investigation.
Imagine my surprise, then, when I walked into the discussion and Solomon seemed to be taking questions head-on, right out the gate. Then I listened to him, and realized beginning with Boeing was a strategic move. Get it out of the way and by the end people will forget that you didn’t really say anything. Solomon’s response to the Boeing complaint was basically (and get ready for the big theme, here): “It’s no big deal. This complaint is exactly like any claim by the GC that an employer replaced union workers with nonunion workers.” Maybe he said something more on Boeing in the minute and a half before I walked in, but I’m going to guess you can get a sense of his comments from his press release.
In case you don’t get NLRB press releases, the GC’s office made some news last year when it went after an employer for firing an employee for “concerted activity” – posting disparaging comments about her boss on her Facebook wall. The GC is actively targeting what it considers to be grossly overbroad social media policies that prohibit employees’ ability to use facebook and other internet sites to discuss their employment. The Board considers these policies as per se violations of employee’s right to concerted activity. While the newsworthy Facebook case last year settled, Solomon said that it garnered enough buzz that every Regional Office now had social media cases working their way through the system. He confirmed that this is a major focus of his office.
Two notable things he said on the Facebook front: (1) We should expect to see a series of GC Memos on social media policies and the NLRA; and (2) a disclaimer in your social media policy that said ”nothing in this policy is intended to interfere with any employee’s Section 7 rights” may work to avoid liability - but it would have to specifically reference Section 7 of the NLRA.
10(j)’s, Default Language & Deferrals after the jump.
So, I don’t know if it’s the warm weather, or the recent supermoon, or just that I have a 2-month-old daughter and these things are sort of front-and-center all of the sudden , but there seems to be a rash of news stories about PG-13 businesses canning women for various physical appearance issues that just make a new dad’s stomach turn a little.
First, Eric B. Meyer over at The Employer Handbook posted about a lawsuit filed by the EEOC on behalf of a woman who was fired from “The Wild Beaver Saloon” (that’s a restaurant – seriously…) because she became pregnant.
Then one of my coworkers shot me a story about waitresses in Atlantic City who were let go after their casino changed hands, and changed (quite drastically) the uniforms they were required to wear. New management broke the news by making the waitresses sift through a bunch of uni’s strewn about a room – all sizes 2 through 4, apparently – and pick one to try on, and then have their photo taken from various angles.
Not long after, according to the waitresses’ age- and sex-discrimination lawsuit filings, they were let go for failing to properly fit in with the new sexy look the establishment was going for.
Look, I’m not going to dwell on the benefits or detriments of these types of places, or whether sex should be used to sell food. I’ll leave that to the city of Evanston, IL. My concern is that places like these seem to feel like termination is the best course of action when trying to change the hotness factor in a workforce, and in just about every circumstance I can think of, that’s an employment-law-no-no. There are exceptions where youth or sex are bona-fide occupational qualifications, but outside of a strip club dancer , you’re not going to win on that argument.
Put simply, you don’t have to be a 22-year-old part-time model to serve booze. Or wings, as Eric Meyer points out in his post:
Just ask Hooters which, many years ago, settled a lawsuit brought by men who claimed that they were denied jobs with the restaurant chain.
If that’s not enough of a cautionary tale, I don’t know what is. Except maybe a strip club getting sued for firing a waitress because she’s old.
Also worth noting – in the case of both the strip club and the Wild Beaver, we know about these cases because the EEOC sued on the employee’s behalf. The EEOC loves these cases, and the press releases that go along with them.
It shouldn’t have to be said, but don’t fire an employee because they’re not hot or young enough for you or your clients. And if your somewhat-sleazy restaurant/casino/bar/internet cafe is going to fire anybody because they’re too old, or too ugly, please call me. I could use the billable hours.
Under a new U.S. Supreme Court decision, an employer can be liable for discrimination based on the bias of an employee’s supervisors, even though the supervisors did not make the actual decision to terminate the employee.
In Staub v. Proctor Hospital, an Army Reservist sued his former employer for terminating him because of his military service, a violation of the Uniformed Services Employment and Reemployment Rights Act (USERRA). USERRA makes it unlawful for an employer to take “adverse action” against an employee where the employee’s military service is a “motivating factor” in the decision.
Staub claimed that his two supervisors lied on disciplinary reports and made up rules for him to follow, because his Reservist duties made it difficult to coordinate schedules, and they wanted to get rid of him. The hospital’s human resources director relied on these reports, in part, in her decision to fire him.
This reliance concept is known as the “Cat’s Paw” theory of employment discrimination. In a cat’s paw case, the ultimate decision-maker may not be biased, but her decision is based on the bias of another employee. Until now, at least, the Seventh Circuit has required that the supervisor’s bias be a “singular influence” on the adverse decision, and any independent investigation by the ultimate decision-maker was enough to make the decision nondiscriminatory. This meant it was super easy to get around a cat’s paw case – just show that the decision-maker conducted an independent investigation, and poof! – the supervisor’s discrimination no longer mattered.
The Supreme Court was having none of it. The Court noted that
An employer’s authority to reward, punish, or dismiss is often allocated among multiple agents. The one who makes the ultimate decision does so on the basis of performance assessments by other supervisors… Since a supervisor is an agent of the employer, when he causes an adverse employment action the employer causes it.
Based on the Court of Appeals’ past rulings, the hospital claimed that its HR director’s independent investigation made any discrimination by the supervisors irrelevant. Slam dunk – case dismissed!
The Court rejected the argument, and overruled the Court of Appeals.
What this mean is that, going forward, if a supervisor’s discriminatory actions are intended to adversely affect an employee, and those actions are relied on at all by a decision-maker, the employer will likely be liable for discrimination. Only if the decision-maker’s investigation leads to a completely unrelated reason to terminate the employee can the employer avoid liability.
The Court made a point of reminding us that the employer bears the responsibility to prove all this.
With the Supreme Court’s new ruling, employers are more liable than ever for the actions of their supervisory employees. It is absolutely critical that employers know their supervisors well, and continuously train them in diversity and proper communication practices. And maybe rethink your diversity training – boring, “lets-get-this-over-with” training is probably not going to convince a biased supervisor to be good. You may want to consider more of a “if-you-do-this-s#!$-we-will-can-you-so-fast” type diversity training. It’s your company on the line, after all.
Additionally, any decision to terminate or otherwise adversely affect an employee’s job should be based on a thorough, independent, and neutral investigation by the decision-maker.
I’m back! Time to fire up this marketing juggernaut again (that’s sarcasm – no one reads this blog).
No, it’s not because I have some new development to tell you about; I wasn’t inspired by the protests in Tunisia and Egypt or anything. And no, I don’t have any more free time than I had a month ago, either. If anything, I’m about to have way less, but that’s a story for another day. Probably a day next week.
No, if I’m honest, there’s one really overarching reason that I absolutely had to start posting again:
I will not be left off of Molly DiBianca’s List again this year. So help me God, I will not.
At any rate, it’s good to be back, folks.