Suits In The WorkPlace

They Should Have Used White-Out

Military Leave Mishandled

    We're seeing a lot of commentary about USERRA in the press these days, and not just on the employment law list serves and blogs.  NPR actually ran a story on it over Memorial Day weekend, and if it made it to NPR, then the odds are that service member's employment rights are going to get a lot more attention from the mainstream media (which seem to run in tandem with NPR on a lot of stories).

     And with cases like this, who can blame the press?  For some inexplicable reason, Pepsi front-line managers decided to begin penalizing one of their employees shortly after he began military service with the Army Reserve.  Specifically, the employee was tagged with his first attendance discipline shortly after he returned from his initial active-duty training in the summer of 2002.  He was hit for three separate actions, several of which Pepsi actually documented as related to his military duties. 

     One more time—it is absolute foolishness to reference someone's protected status in a disciplinary memo or letter of reprimand.  This case just drives that point home, again.

     The employee received attendance points for failing to call in on a designated hotline (a policy which was instituted while he was on active duty and that was never communicated to him) and for missing work after the Army ordered him to report for possible deployment in less than 24 hours.  He was also tagged for leaving work 15 to 20 minutes early to prepare for military-related duties.  Notwithstanding the employee's efforts to resolve these matters, Pepsi allowed the points to stay in his record and never responded to his questions or grievances filed through his union.     

      When the employee threatened to make a public complaint about Pepsi's treatment of service members, the company finally set up a meeting with the human resources management team.  At the meeting, one of the HR managers conceded that the attendance points in the employee's record should be removed.  The employee also raised a question about his entitlement to so-called “bridge pay” under Pepsi's military leave policy.  Under this policy, Pepsi paid compensation designed to make up any pay differential for a period after the employee’s recall to active duty.  Of course, Pepsi had not provided this compensation to the employee, a point that was clear at the meeting.  In fact, the HR manager committed to compensate the employee for the money that Pepsi should have paid during his absences for active duty initial training.

     Pepsi actually deposited more than $10,000 into the employee's bank account after the employee withdrew his complaint of USERRA violations at the Department of Labor.  Inexplicably, Pepsi then took back the amount four days later. 

     At trial for violation of USERRA, as well as for breach of contract and conversion (owing to the failure to pay the so-called bridge pay, and the removal of it after it had been deposited in the employee's bank account), Pepsi tried to argue that the policy for bridge pay was, in fact, only a "draft".  The company also had to explain why its counsel represented that no money had either gone into or come out of the employee's bank account, a clear mistake by the attorney.  The trial judge had little difficulty disbelieving Pepsi’s explanations as to what happened. 

     Pepsi was hit with the $10,000-plus payment, and the court then doubled the actual damages because it found the employer's failure to comply with the provisions of USERRA to be "willful".  The court also determined that Pepsi breached its oral contract with the employee by failing to pay the differential pay (based on the oral statements of the human resources manager that the company would, in fact, pay the employee that amount), as well as upholding the conversion claim.  Finally, the court tacked on an additional $50K in punitive damages on the conversion count.

     Employers, by now, should be particularly sensitized to the difficult attendance issues that roil around a USERRA claim.  In this case, there was very little coordination between the front-line managers, Pepsi human resources managers and, I'm guessing, senior management.  The end result was a mangled decision-making process that actually multiplied the claims against the company, even well after the violation of USERRA was established.

     In short, a USERRA claim should be treated like any other complicated leave of absence issue.  Coordination between the management, human resources, and the legal team is essential so that the kind of false steps that developed here aren't repeated.

Old, Bold, Pilots, Part II

     Following up on a previous post about the mandatory retirement age for commercial and corporate pilots, a federal court ruled that there is no triable issue of age discrimination when a company forces its pilots to retire at age 60.  EEOC v. Exxon Mobil Corp., No. 3:06-cv-1732 (N.D. Texas April 28, 2008) 

     The employer, Exxon, maintains a fleet of private aircraft, including nine sophisticated jets to transfer its employees and corporate guests worldwide.  At the time the case was filed, Exxon's internal policy barred pilots from flying its aircraft after age 60, and it forced pilots to retire when they reached that age.  The policy mirrored the FAA's age-60 rule, which grounds commercial pilots of passenger aircraft at the same age (Exxon has amended its policy to mirror the recent statutory mandated retirement age of 65.)

     The EEOC sued to invalidate this policy on behalf of six pilots who were forced to retire at age 60.  Exxon asserted a bona fide occupational qualification ("BFOQ") defense, based on its claim that the age limit was reasonably necessary to the essence of its business. 

     Exxon's reliance on the FAA rule to support its policy is justified where the rationale asserted by the FAA for grounding pilots at that age is readily applicable to the world of corporate jet flying.  The EEOC attempted to argue that the duties of commercial pilots and corporate pilots were so different that age could not be a BFOQ for the Exxon group. 

     Notwithstanding the fact that flying a corporate jet is frequently even more demanding than flying a larger and more stable passenger airliner, the EEOC tried to argue a distinction based on the differences between the airplanes.  The Commission pointed out the differences in the lavatories on the airplanes, the type of coffee provided on board and the towels used on the plane.  Why on earth the Commission would think that would be convincing evidence in an age discrimination case about flying a jet is beyond me; I suspect what it really did was point out the weakness of their arguments in the areas where it mattered.

     The court would have none of it, noting that there was no material difference, at least for purposes of this inquiry, between the planes used by Exxon and the planes used by commercial airlines.

    The result of this is not surprising; but this is one of the few areas where age may be a BFOQ.  We're going to see more of these kinds of age-related claims as our older workforce begins to push the edge of the envelope in areas like flying, vehicle operation, and the like. 

An Armed Workforce Is a Polite Workforce?

    Starting at the beginning of July, managers and employees in Florida will have even less reason to hang around out in the parking lot after shift change.  Florida residents, who typically have to worry about heat during the summer months, will now have to worry about people packing heat, at least in their workplace parking areas. 

     A Florida law that takes effect on July 1 will require most Florida public and private employers to allow employees and customers to bring lawfully possessed guns onto the employer's property.  The only caveat is that your assault rifle has to be locked inside or locked to your pick-up truck of choice in the parking lot.  Even better, employers may not ask their employees (or their customers) whether they are keeping guns in their cars, search the cars for a gun, take action against an employee based on statements from coworkers about the possession of a gun in the parking lot, or take action against anyone who whips out their Beretta, as long as the gun is never exhibited on company property for any reason other than lawful self-defense.

     The new law does not apply to school property, correctional institutions, nuclear power plants, airports or defense contractor facilities, oil refineries, or other places where possession of a gun is prohibited under federal law or federal government contract. 

     I suspect the folks at Disney World, Sea World, and the Universal theme parks around Orlando are perhaps a tad nervous about this legislation.  A similar law was enjoined in Oklahoma recently on the grounds that OSHA preempted it.  Stay tuned. 

More Racial Harassment Guidance

    Following up on the slave driver entry below, a case from Pennsylvania, and affirmed by the Third Circuit, provides another example of the limitations on racial harassment or discrimination claims.  In Harris v. Cobra Construction, the court was confronted with a situation that, on its face, appeared to be a likely one for trial instead of disposal by summary judgment.  The owner of a company waved a sawed-off shotgun at two of his black employees, and then pointed it at a union business agent, telling him to get off his jobsite.  The owner then turned to the two plaintiffs and asked, "What are you two black *******s looking at?  Now, get back to work."

     Both the district court and the court of appeals found that the claim could not go forward because there was no evidence that the owner's behavior, including his reference to race, was directed towards the two by-standing employees as a result of racial animosity or with the intention to discriminate against them as a result of their race.  They were not singled out or threatened based on their race, but instead, on their status as witnesses to an argument between the owner and the business agent.  The fact that the owner identified their race in the course of threatening them, without more, did not convert the threat from one of anger to one of racial discrimination.

     The court noted that the case might have been different if the owner had made his racial remarks in the context of discussing the plaintiff's work performance or while hiring, firing, demoting or promoting employees.  Instead, under the circumstances, the remark was, at worst, a stray remark in the workplace that could not support a claim of employment discrimination, or a claim of hostile environment. 

     You have to wonder how much further down the path the employer would have had to have gone in order to get a different ruling.  What if he had pointed a shotgun directly at the two and referred to them using a racial slur, rather than just identifying them as "black"?  In any event, the case again notes that the bar for these kinds of complaints can be higher than people might think initially.

Black Sabbath

    A recent case (EEOC v. Texas Hydraulics Inc., No. 06-cv-161 (E.D. Tenn. April 14, 2008)) out of Tennessee federal court should raise some warning flags for employers dealing with religious accommodation issues.  The case contains some troubling language about burdens of proof under Title VII, in the context of an employee who not only refused to work on a Sabbath, but who also claimed that his religious beliefs precluded him from getting anybody else to work in his stead. 

      The employee/plaintiff worked for the employer for some ten years without significant issues.  His religious beliefs prevented him from working from sundown on Friday to sundown on Saturday.  The company was able to accommodate this belief for the most part, although it shifted the employee from one department to another on one occasion so that he would be able to avoid Saturday work.  However, economic circumstances ultimately required the employee to work on a Saturday, and the trouble began in earnest.

     The key issue here revolves around an employer's duty under Title VII when confronted with a conflict between the employee's religious beliefs and the employer's work requirements.  Specifically, the employer has a burden of showing that it cannot reasonably accommodate an employee without an undue hardship.  The requirement has two elements--what actions the employer took to accommodate the employee's religious beliefs; and whether these proposed accommodations would constitute an undue hardship to the employer.  This case hinged on the first element and the court wrote ominously that "both the reasonableness of an offered accommodation, and the amount of effort that an employer put into determining" whether such an accommodation was possible are factors to be considered. 

     In this case, the employer tried to get the employee to find a replacement.  The court ruled that this was not an attempt at reasonable accommodation because the employee had already indicated that it would be a violation of his religious beliefs for him to make someone else work in his stead on the Sabbath.  The employer also proposed trying to be lenient with the plaintiff's accumulation of absences in the hope/expectation that Saturday work would eventually fade away.  The court rejected this out of hand as a reasonable accommodation, commenting that a "wait-and-see posture is no accommodation at all." 

     The point for practitioners to note is that an employer must deal with the requirement that it offer or at least contemplate accommodations that will pass initial muster as reasonable, before it can get to the undue hardship part of the analysis.  In this case the court said that the employer could have compiled a list of employees qualified to substitute for the plaintiff and asked them if they would be willing to switch shifts or substitute.  The employer could also have posted a notice asking if any employee would be willing to substitute for the plaintiff.  Either one of these things would have constituted a reasonable attempt at accommodation, and would have allowed the employer to get to the much easier part of the analysis regarding undue hardship.  For example, had the employer asked qualified employees if they were willing to switch with plaintiff for his shift and none accepted, then the employer could have readily argued that forcing someone to work in plaintiff's place would have been an undue hardship.  This argument would almost certainly have been sustained by the court.

     Instead, the court found that the employer did not make a good faith effort (or reasonable effort) to accommodate its employee, as required by Title VII.  As a result, this case is headed to trial.  The lesson here:  when someone requests such an accommodation for religious beliefs, do not sit back and propose half-hearted or unworkable solutions.  The employer has an affirmative duty to try to solve the problem with the employee before claiming the solution is simply too difficult.  A failure to do so initially effectively denies the employer a defense down the road.

Overseas Whistleblowing?

    A recent case out of the Southern District of New York has serious implications for multi-national corporations with U.S. subsidiaries or anyone with employees working overseas.  In O’Mahony v. Accenture, No. 07-7906 (S.D.N.Y., Feb. 5, 2008), the plaintiff was a partner at Accenture, LLP, a U.S. subsidiary of Accenture Ltd., a Bermuda-based company.  O’Mahony was an Irish national working in the United States.  Accenture moved her to France in 1992.  Foreign employees in France are required to contribute to French social security and O’Mahony told her supervisors that Accenture needed to make those contributions.  At some point, senior Accenture management, located in New York, told her that the U.S. tax partner for the company decided not to make the social security contributions and would effectuate the plan by concealing the length of O’Mahony's assignment in France.  When O’Mahony objected to what she perceived to be tax fraud, an Accenture senior manager, also located in New York, supposedly decided to reduce her level of responsibility, along with her compensation. 

     O’Mahony filed a complaint under the Sarbanes-Oxley Act, claiming that Accenture retaliated against her because of her objections to the tax fraud scheme. 

     Now it gets interesting.  The Department of Labor initially dismissed O’Mahony's complaint on the grounds that each of the elements of her complaint occurred in France and that the DOL lacked jurisdiction over the claim because the whistleblowing provisions of Sarbanes-Oxley do not apply extraterritorially.  The DOL administrative law judge upheld the dismissal on appeal and O’Mahony filed a petition for review with the DOL Administrative Review Board. 

     Probably figuring that the ARB wasn't going to upset the DOL apple cart by reversing its own administrative law judge, O’Mahony pulled the case out of DOL's administrative process and put it into federal court.  This was an option because the ARB couldn't make the six-month deadline for processing claims under the Act.

     Surprisingly, the federal court reversed the DOL dismissal, finding that although the statute does not apply to elements occurring overseas, in this case the alleged adverse decisions were all made in the United States.  In other words, the actual work site or nationality of the employee doesn't matter; it's where the decisions to engage in fraud/Sarbanes-Oxley violations occur that drives the jurisdiction issue.

     This decision could have some real fall-out for multi-national corporations, especially those with operating headquarters in the United States.  There are plenty of places in the world (just about all of the former Soviet Union, for example) where companies must operate in ways that are not exactly compliant with every single local and national ordinance.  An expatriate employee who raises this non-compliance can establish a Sarbanes-Oxley claim simply by alleging that he suffered an adverse employment action resulting from a decision made in the United States.  In other words, moving these kinds of issues up the food chain to higher headquarters, when those higher headquarters are located in the U.S., might not be the best plan of attack for dealing with a complaint that might trigger Sarbanes-Oxley liability. 

Raising the Roofies – Harassment Investigation 201

A former female attorney at a prominent Boston law firm has filed harassment charges, alleging that she was drugged at a holiday party by another employee.  According to a Boston Globe story last week, the former associate filed a claim with the Massachusetts Commission Against Discrimination, alleging that the firm failed to adequately investigate her charges.  The suit offers an important lesson in the need for both communication and follow up during – and after – a harassment investigation.

The facts, as alleged in the complaint, are that the female associate became dizzy at a holiday party and later went to the hospital, where traces of an anti-seizure medicine were found in her blood.  She reported the incident to another female lawyer, who confided that a year earlier she too had been drugged, and also raped, by a firm employee. 

The victim took all this information to HR, who – not surprisingly – conducted a prompt investigation, but could not determine whether she had been given the drug by another employee, or by someone else.  The firm nevertheless provided personal safety training for its employees, but did not specifically issue a warning about the incidents themselves.

So far, so good, right?  Reasonable steps in response to a difficult situation.  It is not uncommon for a harassment investigation to produce inconclusive results, despite an employer’s best efforts.  Sometimes you interview every possible witness, look at all the documents, but still just can't determine what happened or who's telling the truth.  When that happens, you conduct policy reminders, relevant training (like here) or take other proactives steps that are reasonable.

However, your obligation does not always end there.  And here’s where the complaint, if true, raises a few red flags for me.  A few weeks after the drugging incident, at a dinner with firm employees, the complaining employee said she overheard a male employee brag about how he likes to use roofies (date rape drug, for those who thought the title related to either candy or building materials) on women and then have sex with them.  (Side note of no legal consequence:  I’m not quite sure how this topic came up during dinner, nor am I clear on why the guy, who apparently fancied himself quite the ladies’ man, tried to impress his dinner companions with confessions of a desperate felon.  Boy, dating sure has changed since I was single . . . ).

Nevertheless, the complaining employee then took this new information to HR, who once again said they would investigate.  According to the complaint, however, after several weeks, HR still had not talked with the male employee who supposedly made the comments.  I call that "Problem Number 1."

Following closely on its heels is Problem Number 2:  the employee stated she was uncomfortable working around the guy (I wonder why), but was told that if so, then she could move to another floor.  No mention of a suggestion that he be relocated.  Several weeks later, she was told that he was no longer with the firm, but by then she claims to have felt so uncomfortable that she had to leave the firm.

I don’t know whether these allegations are true or not.  Regardless, I question whether the whole matter (or at least the litigation) could have been avoided with better follow through and better communication.  First, when your investigation is inconclusive, and relates to a possible felony like rape, and you get new information about the potential culprit, you follow up on that information as fast as you possibly can.  Whether the firm did so here is unclear, but if they did, it doesn’t sound like they communicated a sense of urgency to the alleged victim.  For whatever reason, she concluded that they had failed to talk to the guy for several weeks even after she reported his not-apprpriate-for-dessert roofie confessions.

Second, you never transfer the complaining party in a harassment situation unless they request it.  I rarely (if ever) say never, but in most cases it is a risk to transfer the victim, because, like here, the transfer may look, or be perceived as, retaliatory – even if it wasn’t meant to be so.

My employment lawyer Tarot cards suggest that this litigation might have been avoidable.  Note that this person did not file the charge immediately after she was drugged, or after the other female said she had been drugged and raped, or even after the firm's initial investigation produced no conclusive results.  The charge came only after she provided the firm with additional information, after several weeks passed with what looked like no action by the employer, and after she was told she could move if she had a problem with Mr. Roofie.  Then she finally left and filed a charge.  Hard to tell exactly how this one will play out.  Whether or not the allegations are accurate, however, sometimes dropping everything else on your plate to follow up on an important lead in an investigation can make the difference between whether you get sued, or whether you keep a potentially good employee.  Think about it.