Suits In The WorkPlace

Fixed Maximum Leave Entitlements -- A Bad Idea

    The EEOC has just demonstrated, again, why it's a mistake for employers to set fixed limits on the amount of medical leave allowed employees before termination occurs.  Using one of its favorite targets, Denny's, Inc., the Commission filed suit in Baltimore this week under the Americans with Disabilities Act.  The suit attacks Denny's policy of enforcing a maximum 26-week medical leave entitlement (apparently reduced in some cases to 12 weeks) without assessing whether an employee is "disabled" and without making an individual determination of reasonable accommodation.

     Denny's disputes the claim, which originated in the termination of a Denny's manager following the amputation of one of her legs.

     The EEOC has long focused on fixed medical leaves as a target for action under the ADA.  The reasoning goes something like this - an employer that automatically terminates employees after a set amount of time is not making the kind of individual determination on the issues of disability and reasonable accommodation required under the ADA.  The Commission in some cases views the fixed absence period as a "floor" for reasonable accommodation.  In other words, by establishing a fixed time which the employee can be away from work with no adverse effect, the company is admitting that it can accommodate such an absence without an undue hardship.

     Under this view, the company is then required to separately assess whether the employee can return to work at the end of the medical leave period.  A request for an additional 2-3 weeks of time off, on top of an approved absence of 26 weeks, is generally viewed as a reasonable accommodation, notwithstanding the fact that the employee has already been away from work under the medical leave entitlement. 

     Employers can maintain medical leave maximums, but must remember that they will be required at the end of that period to make an individual assessment of the employee's ability to return to work.  In many cases, this will not be a problem, the employee will not be able to provide a definitive return to work date, or will be on long-term disability, typically situations where she is not qualified for her position under the ADA.  In those situations where an employee might be able to return to work at the end of a lengthy medical leave entitlement, the employer must be extra careful to document any adverse action and show that it is based on a review of requirements under the ADA standard.

Conflict Over Contraception

    Employers generally have to accommodate their employees' religious beliefs as long as the cost is a minimal one.  Walgreens Drug Stores, for example, had a policy that allowed pharmacists who objected to dispensing certain contraceptives on moral or religious grounds to decline, as long as the prescription could be filled by another pharmacist in the store, or at a nearby pharmacy.  A fairly straightforward and reasonable accommodation that apparently imposed acceptable costs on Walgreens.

     Enter the over-reaching and politically correct state government of Illinois.  In April 2005, Illinois required pharmacies to dispense any contraceptive for which the customer had a valid and lawful prescription, and coupled it with letters to individual pharmacists and physicians explaining that the change in the law was due to individual pharmacists objecting to filling prescriptions for the so-called “morning-after pill”, a form of contraception.  Following up, and to make sure that everyone was clear on the intent of this regulation, the governor sent a letter to a political action committee indicating that individual pharmacists who refused to fill birth control prescriptions would subject their employers to significant penalties. 

     In September, 2005, the state department responsible for licensing pharmacists began filing disciplinary actions against Illinois pharmacies, including Walgreens, for having in their employ individual pharmacists who refused to dispense certain contraceptives.  Individual pharmacists who were suspended by Walgreens under this state policy, and Walgreens itself, sued alleging federal constitutional violations, as well as a violation of Title VII. 

     An Illinois federal court has now refused to dismiss these complaints.  The court noted the specific focus of the rule change on individuals and the fact that pharmacists who raise a religious objection are subject to having their employment terminated because their pharmacies will be subject to disciplinary action.  Although states may generally promulgate neutral laws of general applicability, even where they conflict with individual religious requirements, a state law or regulation that is designed to discriminate against individuals because of their religious practices is subject to strict scrutiny and requires a compelling state interest.

     Based on the statements made by Illinois political leadership, it appears that the pharmacists/plaintiffs in this case can make at least a colorable claim that these regulations were aimed at them as individuals.  The court acknowledges this in its opinion, noting the comments made by the governor that the regulations were enacted in response to the acts of individual pharmacists, and the failure by the state to provide pharmacies with a way of accommodating the objections of their employees.  The court also found that the individual pharmacists had a valid claim that the state violated Title VII because there is no basis for accommodation of religious beliefs in the state regulations.  The targeting of individual pharmacists by requiring their employers to suspend them is a sufficient basis to find that the state is trying to force the employer to not accommodate the pharmacists' individual religious beliefs.

     I suspect that this case may well settle with the state backing off its absolute position that pharmacies cannot employ pharmacists with religious or moral objections to dispensing these contraceptives.  A common sense approach would simply be to allow Walgreens and other pharmacies to continue what they had been doing.  However, at least in Illinois, the importance of pandering to specific interest groups typically trumps common or legal sense, at least initially.  A problem that had been dealt with quite adequately by the private sector gets pulled into federal court once the state intervenes with an unworkable requirement.

Ineffective Releases of Employment Claims

    Termination releases of claims are common tools used by employers to preclude litigation by ex-employees.  A federal court in Pennsylvania recently decided that an employee could not knowingly waive her rights under the Family and Medical Leave Act, or the Americans with Disabilities Act, despite signing a comprehensive waiver and release of all claims in exchange for a severance payment, even when she keeps the payment.  In Dougherty v. Teva Pharmaceuticals, the court determined that, notwithstanding her signature on a general waiver and release of all claims against her former employer, and her acceptance of several months of pay and health insurance, the plaintiff was not prevented from suing her employer on a claim of violating the FMLA and, her concurrent ADA claim as well.

      Circuits across the country are split on whether employees can waive an FMLA claim because of fairly straightforward Department of Labor regulations found in 29 C.F.R. § 825.220, which say that employees cannot waive nor be induced to waive their rights under the FMLA.  Some courts have interpreted this to mean that the clause only applies to current employees and that it only limits a prospective waiver of rights (rights that would attach in the future) under the statute. Other courts have held that the regulation bars outright any waiver under any circumstances.     

     The court here seems to lean towards decisions in the middle ground, which prohibit waivers of FMLA rights unless they are approved by the Department of Labor or a court. 

     The court then went on hold that even though the plaintiff retained her severance payment and health insurance benefits after she discovered the release was voidable, there could be no ratification of the agreement because the Third Circuit refuses to apply ratification to claims involving federal employment discrimination statutes.  Finally, having found there was no valid release of FMLA claims, the court determined that it could not sever the void FMLA waiver from the possibly valid ADA waiver under the language of the agreement.  It therefore invalidated the entire release, allowed the plaintiff to keep the compensation that her employer paid in consideration of the release, and let her ADA and FMLA claims go forward to trial.

    This is a particularly dangerous area for employers.  Because of the vague notice requirements under the FMLA, employers can easily find themselves having accepted what they believe to be complete and total releases of all claims from their employees, only to find themselves sued for latent FMLA claims not brought to their attention at the time.  In these situations, it is important for employers to draft agreements that specifically mention that the employee is giving up an FMLA entitlement, and put severability language in the agreement so that other claims can be protected from the void FMLA claim.  This issue seems ripe for Supreme Court resolution given the wide disparity between the cases.

Direct Discrimination Discussion

    Employment discrimination cases are typically resolved on something called the McDonnell-Douglas model of proof.  This test, used by federal courts (and some state courts) in analyzing summary dispositions of employment cases (i.e. before trial) dates back to the early 1970s and is used to focus the court's inquiry on whether the disputed employment action, typically a termination or demotion, was actually based on a protected factor such as race, versus a legitimate business reason. 

     But there is another way of proving these cases - using something called a direct method of evidence, or "direct" evidence of discrimination.  Direct evidence is so closely linked to the protected factor that a jury can properly conclude that the employer intentionally discriminated against the employee, either because the evidence references the protected factor itself or because the evidence creates so strong a circumstantial inference.

     Direct method evidence cases are rare because direct evidence of discrimination is so obviously improper.  For example, it would be direct evidence of discrimination to hear a hiring manager say, "We can't take Employee A because we have too many women already in this office."  Similarly, circumstantial evidence under the direct method would consist of things like managers claiming that women needed to stay at home with their children, that women were incapable of working long hours because of home commitments, that women weren't as competent in the job as men, and similar remarks.  The point here is that once an employer has this kind of conduct in its workplace, it becomes impossible to dispose of a discrimination case on summary judgment.  The evidence itself is sufficient, with nothing more, to raise the inference that the employer is illegally discriminating against the subject employee.

     Such a case was decided recently by the Seventh Circuit.  The plaintiff claimed race and pregnancy discrimination, as well as retaliation, by her employer.  She alleged that her immediate supervisor said, "Mexicans cause problems and come to the United States to take jobs away from American people," and also said that she would not hire any more Mexicans because they cause too many problems in the workplace.  In addition, the supervisor provided significantly poorer working conditions for Hispanic employees with regard to things like job duties, breaks and shift assignments.  The employer made similar comments about the employee's pregnancy, which the court found established direct method evidence of pregnancy bias.  Finally, to round out the trifecta, after the plaintiff filed a complaint against the supervisor, the supervisor issued a warning notice that referenced the employee's protected complaint as a basis for the warning!  Again, clear direct method evidence that precluded summary judgment.

     Perhaps because of the audacity of the discriminatory conduct alleged in this case, or perhaps because it was unused to seeing these kinds of cases, the district court had awarded summary judgment to the employer.  The Seventh Circuit reversed saying, "[W]e fail to see how the district court granted summary judgment for the defendant."  No kidding.

Alcohol Use Boosts Income

While we're on the subject of productivity, a friend sent me an article quoting a study from the Reason Foundation which suggests that people who drink alcohol make more money than those who don't.  I don't know why he sent me the article, but it's interesting in light of the continuing trend toward characterizing addictions as disabilities that impact employees at work.  Bucking that trend, the study "published in the Journal of Labor Research Thursday concluded that drinkers earn 10 to 14 percent more than teetotalers, and that men who drink socially bring home an additional seven percent in pay."  The article acknowledged that the study may have had certain political unerpinnings:  "the authors acknowledged their study, funded by the Reason Foundation, a libertarian think tank, contradicted research released in 2000 by the Harvard School of Public Health."  Nevertheless, the authors claim that their "empirical survey" supported their conclusions, suggesting that a social drinker might have a "wider range of social contacts" that open more doors from an employment and business standpoint.  Does this mean you should add the question "Alcohol User?" to your employment application?  Certainly not.  But it does raise a somewhat contrarian perspective regarding an activity that, at least in and around workplace discrimination laws, has a less than positive connotation.

Crackberry Addiction an ADA-protected disability?

The New York Sun had an article last week about an upcoming study from the Rutgers School of Business about how workers are becoming addicted to their BlackBerries.  This addiction, will, according to the article, inevitably lead to suits against employers which "could potentially cost corporate America hundreds of millions of dollars."  I say bring it on.  The article, and apparently the underlying study, both lament the fact that people get caught up in the fast-paced world of technology and are therefore unable to truly relax.  Gayle Porter, the professor who is about to publish the study, was quoted as follows:

"If companies develop a culture in which people are expected to be available 24 hours a day, then they should be prepared for the physical and psychological consequences," Mrs. Porter said. "Addicts exhibit extreme behavior and have no control over themselves. So a corporation handing someone a BlackBerry on his first day of work could be seen as enabling, even accelerating, a serious addiction to technology."

Is she serious?  Does this mean that whenever an employer provides employees with tools that increase their efficiency, coupled with setting high performance expectations, they are "enabling" or "accelerating a serious addiction to technology?"  I think not.  Workaholism predates the BlackBerry.  PDA's are just the latest in a long line of devices which, like any other tool, can be used or misused.  To blame the employer for providing that tool just doesn't hold water, especially in light of current employment law.  A disability under the ADA has to be a condition that "substantially limits one or more of [an employee's] major life activities.” 42 U.S.C.§12101(2). In turn, "major life activities" are defined as basic functions such as “caring for oneself, performing manual tasks, walking, seeing, hearing, speaking, breathing, learning and working.” The closest thing the article mentions to a major life activity seems to be the ability to relax on the beach:

These days, though, many executives on vacation carry small arsenals of mobile telephones and computers, even on the beach. From their sandy towels they keep close tabs on both the workplace and the capital markets. Friends and relatives, Mrs.Porter said, are now complaining that no one in these jobs is getting any rest or relaxation.

"Relaxation" is a far cry from a major life activity.  Courts have in fact held that the ADA does not require an employer to provide an environment free from aggravation and stress. Cannice v. Norwest Bank Iowa, N.A., 189 F.3d 723, 728 (8th Cir. 1999).

Nevertheless, it appears that is exactly what this study suggests employers should have to do, by refraining from the deadly combination of 1) providing Blackberries and 2) expecting high performance from their employees.  As an avid user of technology, I am offended at the suggestion that the tool, and not the person, is to blame.  People ought to take responsibility for balancing their own schedules and workload, and it is the refusal to do so, encouraged by studies such as this one, that leads to an environment that fosters the host of frivolous employment lawsuits choking our federal court system today.

Besides, in the end, the system is self-correcting.  In other words, if you see me on a beach typing on a BlackBerry, you have permission to kick the crap out of me.