Suits In The WorkPlace

Happy New Year – Avoiding a Calendar Anomaly That May Bring An Extra Payday To Your Employees

David Greenspan — Thu, 18 Dec 2008 01:38:00 GMT

In every year there is one day that occurs 53 times rather than the usual 52 (7 days times 52 weeks a year is 364 days, not 365). In 2009 this "extra day" falls on a Thursday – one of the two biggest paydays of the year. This means that if you pay your employees on a bi-weekly Thursday basis, they will see 53 paydays instead of the usual 52 in 2009. If your offer of employment is an annualized number (i.e., "you will receive $100,000 per annum") then this anomaly is not a legal issue for you but, of course, may result in an employee relations issue. However, if you offer pay on a bi-weekly basis, i.e., "you will receive $2,000 every other Thursday ") you may contractually be obligated to pay the person 27 pay cycles for a calendar year 2009.

Of course, from an accounting standpoint, most employers divide base salary by the number of pay periods resulting in the payment for the particular pay period. However, an employer who pays a bi-weekly Thursdays basis, will either have to pay out an extra paycheck for 2009 or divide the annualized payment by 27 – which will result in a reduction of the employee's pay in each of the 27 pay periods. For example, a company with 50 salaried workers making $2,000 every two weeks would incur an extra $100,000 in salaries for calendar year 2009 – hardly an insignificant number in light of the recent economic woes. It might be prudent to examine your offer letters and employment agreement in light of this calendar anomaly.

By the way, for those of you who pay employees on Fridays, this issue will be on your plate in 2010.

FMLA Regs on the Way

Rod Satterwhite — Fri, 14 Nov 2008 13:36:00 GMT

Be on the lookout for new regulations to be issued by the Department of Labor relating to the Family and Medical Leave Act, according to this and several other recent stories. The regulations may be published as early as today, based on information from our sources. You may (or more likely may not) recall that these regs are nearly 2 years in the making: we noted in a post here in November 2006 that the DOL had opened the comment period for the regulations.

Based on the proposed regulations, the changes will certainly have an impact on the day-to-day administration of leave under the FMLA. Although it is not clear that the final regulations will adopt all the changes in the proposed regulations, some areas mentioned in the proposed regulations include:

Additional notice requirements the employer must provide to the employee regarding paid leave substitution
Employees who miss time under FMLA may now be disqualified from perfect attendance bonuses
Voluntary light duty work resulting from a worker's compensation injury is no longer considered FMLA
Employers will have 5 days instead of 2 to notify employees of their eligibility for FMLA under certain circumstances
Employers must provide additional information, such as the amount of FMLA used, and the reason for denying FMLA coverage
Employees must follow employer call-in procedures even for FMLA leave
Employers must allow employees 7 days to cure deficiencies in medical certifications

Remember, these are examples of the potential changes, based on what was in the proposed regulations. You shouldn't start changing policies or notice letters until the final regulations are issued and digested by lawyers, pundits and pollsters. Once we have the regulations and have analyzed them, we'll publish a more thorough summary and analysis here.

Looking for "Lazy in DC"

David Greenspan — Tue, 11 Nov 2008 21:18:00 GMT

I recently came across an interesting Law Review Note discussing some things you may want to consider when looking at publicly available shared information sites (i.e., MySpace, Facebook, Youtube) in the hiring context.

The note, The Newest Way to Screen Job Applicants: A Social Networker's Nightmare, 60 Fed. Comm. L.J. 597 (Carly Brandenburg, June, 2008), identifies three primary legal concerns when it comes to conducting Internet searches on job applicants. These issues relate to privacy, credibility and hiring discrimination.

Okay, the first issue is a relatively easy one. While I can see a situation where an applicant would assert a claim sounding in privacy, the few cases that address this issue find that a person does not have a privacy interest in what he or she makes publicly available in the public domain. However, some social networks require each user to log-in and to acknowledge its privacy policy or "terms of use" policy. Don't forget to read that policy - it may say things like "may not be used for commercial use" (like the Facebook one) - that probably just means "no advertising" but other sites may have more draconian terms of use.

The second issue is credibility. Anyone can post anything online. Therefore, employers who intend to rely on information posted online for hiring decisions should verify the accuracy of that information before relying on it. This is one of the main reasons we have the Fair Credit Reporting Act - a separate topic in and of itself. The key here is that unless you can see the John Q. Smith who you just interviewed is the same John Q. Smith who goes by the screen name "Lazy in DC" and had a bright orange Mohawk earlier this year (apologies to any "Mr. Smiths" out there), it is best to very strongly consider the source.

The third issue is "unintended, unnecessary knowledge." Sometimes it is better not to know. This is true when it comes to the unknown protected classes of your applicants. For example, if an interview went well and then the next day you look at a Myspace profile (with a bunch of pictures) you now know the candidates gender, race, nationality, marital status and religious affiliations. Therefore, employers should be very cautious when determining if information acquired from the Internet is relevant to job performance and whether there is a legitimate and legal reason to discount a candidate based on what they might have posted online.

Finally, let me say: (1) I am aware of the irony that I am posting this information on a blog free and available to the world (not that the world is looking); and (2) I do not have, nor have I ever had, an orange Mohawk (let’s see if Satterwhite can say the same).

Red, White or Blue - Politics in the Workplace

David Greenspan — Wed, 22 Oct 2008 00:35:00 GMT

You may or may not know, but there is a pretty big election just a few weeks out, and as such, the water cooler conversations about politics are heating up. I have received several calls over the past few weeks from clients wondering about the restricting of political speech and/or display in the workplace. From a legal perspective, private employers are generally free to restrict all political speech in the workplace while also preventing employees from wearing tee shirts, creating screen savers or wearing buttons expressing political preferences. The one major caveat here has to do with political speech interposed with union issues. In fact, the NLRB's general counsel officer issued a memorandum on July 22, 2008, styled as a "Guideline Memorandum concerning unfair labor practice charges involving political advocacy," which I commend to you.

This election has been so divisive that it has the potential to spark discussions on a wide range of issues from race to national origin to gender, age and religion – and we all know that conversations about protected classes have no place in the workplace. Most people think they have a First Amendment right to free speech wherever they go and don't realize that when it comes to the private workplace, their assumptions are just plain wrong. In theory, so long as everybody is treated equally, an employer can prevent all political speech in the office during work hours. However, it is not recommended that companies take such draconian measures. Focus on the concept of respect for other opinions when counseling political conversation in the workplace. If there is a need to draw a line, be consistent in your administration of political limitations. Consistency breeds credibility when it comes to the administration of policies and practices in the workplace.

It is also important to practice what you preach. Managers are often just as "involved" in the political discourse in the workplace as any other group of employees. Federal laws prevent employers from requiring their employees to contribute to a federal political campaign and there are limitations on how often workers can be solicited for donations. However, the more important issue is to refrain from creating an atmosphere where employees feel pressured to follow the politics of their managers, supervisors or the company itself.

So whether you are for Barak Obama, John McCain or even Ron Paul, just remember that campaigning must be kept 100 feet from all polling stations and should be kept 100 feet from the water cooler too.

What Happens in Vegas Doesn't Always Stay in Vegas

David Greenspan — Thu, 16 Oct 2008 19:28:00 GMT

A diabetic employee from the City of Bethlehem, Pennsylvania, was discharged for dishonesty by calling in sick for two days, when she was actually in Las Vegas having her lips and eyebrows permanently tattooed. The employee brought an action against the City, its Mayor, its Director of Human Resources and its Business Administrator (no word if the tattoo artist was a named defendant) claiming: (1) that she was terminated because of her gender and disability (Type-II Diabetes); (2) she was unlawfully retaliated against for seeking an accommodation under the ADA, as well as for having reported harassment under Title VII; (3) that the City interfered with her FMLA rights; and (4) she was denied procedural due process under the Fourteenth Amendment in violation of Section 1983 in light of her public employment.

Although the parent in me says that tattling on a co-worked isn't a “nice thing to do,” somebody saw fit to send an anonymous note to the Mayor stating that the employee was in Las Vegas on vacation rather than on sick leave. Upon her return, the City asked her about her absences and, according to the opinion, the employee lied – telling the City that she had not been to Las Vegas but rather had been in her sick bed at her boyfriend's house. In support of this story, she even produced a note, allegedly from her doctor, confirming her illness. A City investigation ensued and it was determined that the employee lied. As a result, she was terminated for dishonesty.

The City filed a successful Summary Judgment Motion and the employee appealed to the Third Circuit. The Court determined that the employee failed to offer any evidence of discrimination or retaliation, noting that the employee “presented no evidence that any male employee of the City improperly took sick leave, lied to the City about the circumstances surrounding the sick leave, and then attempted to cover up his whereabouts to the City Administration [.]"

The most curious part of the opinion was the discussion regarding the FMLA interference claim. For those of you that agree with me that the FMLA is the most easily manipulated employment-related federal statute, the Court provided strong pro-employer language discussing an employee notice requirements where the leave is foreseeable (an employee must give 30 days advance notice if the need for leave is foreseeable). As the court said, "We agree with the District Court that there is no reason why Ms. Hughes could not have notified the City of the need for FMLA leave either from Las Vegas or when she returned to Pennsylvania." I must confess, I was somewhat surprised and chagrined to see that nowhere in the opinion did the Court acknowledge the fact that going to Las Vegas for a two day vacation to have your eyebrows and lips permanently tattooed for cosmetic reasons may not qualify as a serious health condition.

One last question – aren’t there any tattoo artists in Atlantic City? Isn’t a three hour drive is a whole lot easier than a four hour flight?

[The case is Hughes v. City of Bethlehem, No. 07-2349 (3d Cir. Oct. 2, 2008)]

Changing of the Guard

Rod Satterwhite — Thu, 16 Oct 2008 13:44:00 GMT

It is with mixed emotions that I announce a changing of the blogger guard at Suits in the Workplace. My co-blogger and friend Lou Michels has decided to focus his efforts elsewhere, and we will miss his wit and wisdom greatly. On the bright side, I'll be joined by my colleague David Greenspan, another member of our L&E team at McGuireWoods. David is a great guy, knows his stuff when it comes to employment law, and will probably be pretty funny once he loosens up a little. So don't give him too much of a hard time in his first few posts. Welcome, David.

Standards Are Standards

Lou Michels — Wed, 24 Sep 2008 19:40:00 GMT

Notwithstanding my dislike of the Family and Medical Leave Act because of the latent uncertainty it introduces into attendance issues, the statute does have some well-defined requirements, especially regarding eligibility. A recent case out of the 7th Circuit shows just how tightly those requirements should be applied.

A former postal worker sued the USPS for an FMLA violation when it terminated her for absenteeism.

The facts in this case could only apply to someone working for the government. The employee was hired in 1993 as a mail handler and terminated at least four times over the next seven years for poor attendance. She also received multi-day suspensions for failure to show up to work regularly. However, following each termination, the plaintiff was able to talk her way back and get the firing changed to a suspension instead.

In October, 2001, plaintiff's supervisor ordered her to clock out two hours early as a punishment because she was being insubordinate. Plaintiff later disagreed with the supervisor's determination, but failed to properly grieve the discipline within the appropriate time frame.

After plaintiff missed more time in December, 2001, the USPS had enough and fired her. She sued under the FMLA, claiming that she had a bona fide medical reason for missing work. The USPS initially admitted that the plaintiff worked the required 1250 hours in the 12 months preceding her unscheduled absence, but then amended its answer and denied that plaintiff was qualified for FMLA leave. In support of its contention, the Post Office produced plaintiff's payroll records crediting her with 1248.8 paid hours and 1249.8 time-clock measured hours. On the basis of the 1.2 or .2 hour shortfall, the district court awarded summary judgment to the Postal Service, finding that the plaintiff was ineligible for FMLA protection because of the failure to meet the 1250 hour threshold.

The plaintiff appealed, arguing: that the time that she spent putting on her Post-Office issued gloves, shirt and shoes should have been factored in to give her the needed additional time (the FLSA exception); that the two hours that she lost on the suspension should be added to her work totals because she was wrongly ordered to clock out (the union contract exception); and that the 1.2/.2 hour shortfall was so minor that the court shouldn't really count it, but should instead give her credit for meeting the minimum threshold (the teenager coming in after curfew exception).

The Seventh Circuit upheld the district court, noting that the ex-employee introduced no evidence to dispute the accuracy of the payroll records and that a failure to meet the requirement is a failure to meet the requirement. The court would not add in the additional 1.2 / .2 hours to bring her to 1250 hours, nor would it give her credit for the 2-hour suspension (because she had not grieved the suspension timely) and finally ruled that the donning and doffing of minimal amounts of non-unique safety clothing is not compensable time and could not be counted.

There are two important lessons here. The first is that statutory standards are exactly that, and courts will enforce them when confronted with irrefutable evidence that an employee has failed to make the grade. The second is that even small disparities in things like time records can have huge effects down the road. This case would have gone the other way if the company had not held the plaintiff to her grievance requirements, or if its timekeeping records had not been pristine. Particularly with troublesome employees, the company that plays strictly by the rules can usually hold the employee to the same strict standard.

USERRA Reemployment Obligations are Firm and Fixed.

Lou Michels — Wed, 17 Sep 2008 15:18:00 GMT

A U.S. appeals court has ordered a Nashville, Tenn., police department to reinstate a soldier's job that he left for active duty in Kuwait, in a case affirming the fixed nature of re-employment rights for persons returning from military service.

An Army reservist left his job as a police officer in November 2003 for active duty overseas. While overseas he faced disciplinary proceedings for making homemade wine and sharing it with other soldiers. Petty was arraigned, but the charges were eventually dropped. In January 2005, Petty received an honorable discharge. When Petty tried to return to his job as a police officer, the department delayed his rehiring during a three-week “return-to-work” process (a mandatory set of tests, evaluations and questions designed to determine if a returning soldier is able and ready to serve in a police force - a process that was . Alleging that he had lied about the alcohol charges, the department launched its own investigation into the military's charges. During the investigation Petty was asked to sit at a desk answering phones and taking police reports. Indeed, years later (during the litigation), the City maintains that pending the outcome of its on-going investigation, Petty may be unqualified.

The Court found that Petty's reemployment rights were violated on two bases. First, it found the "return to work" process violated USERRA. The Court specifically noted that the City's well-intended policy of testing to ensure that individuals entrusted with the protection of the public are temperamentally and emotionally ready to work, violated USERRA's reemployment rights. Although not in and of itself a determinative factor, it was of note that this "return to work" period was unpaid - which also resulted in a denial of a benefit of pay under USERRA.

The Court also found that it was not for the City (i.e., an employer) to launch its own investigation into the nature of a returning veteran's conduct in the service. Otherwise stated, an employer cannot substitute its own judgment for that of the military.

Reinstatement rights under USERRA are intentionally rigid and always construed in favor of the returning service member. Prompt reinstatement to the employee's escalator position is mandatory absent very narrow (and difficult to establish) exceptions.

Thanks to David Greenspan in our Tysons office for this input.

Protecting Retiree Medical Benefits

Lou Michels — Tue, 09 Sep 2008 13:26:00 GMT

I have some interest in companies trying to modify medical benefits offered to their retirees, both from a public policy perspective and a legal one. Generous retiree medical plans have proven to be the bane of large manufacturing companies, including General Motors, Ford and the rest of the U.S. auto industry. To the extent that companies find themselves with an increasingly aging workforce and its associated higher medical costs, modifying retiree medical benefits may become a matter of corporate survival.

Of course, cutting the medical benefits of people who have been relying on them for years creates a huge problem for the affected retirees, and a great incentive to sue. Hell hath no fury like an AARP member scorned. So, it's not surprising that post hoc modifications of retiree medical plans are becoming a very contentious issue. These cases typically involve a company moving to alter the benefit plans that it set up years ago in an effort to rein in spiraling medical costs. Such benefit plans are typically modifiable at-will by the company because they are welfare plans and not pension plans (which cannot be altered under ERISA). The problems typically arise when unions are involved, because there are circumstances where a collective bargaining agreement can be used to limit the company's discretion on modifying retiree medical benefits.

Such was the case here. Exelon made unilateral changes to its retiree medical benefits programs in January 2004. Exelon's changes immediately created problems for some retirees, and had the potential to affect its current employees when they ultimately retired. Exelon's union, which negotiated retiree medical benefits in various MOAs as supplements to its collective bargaining agreements with Exelon, proceeded to file grievances over the modifications in an effort to ultimately force the company into arbitration over its changes. Exelon processed the grievances through the first three steps and even participated in the selection of an arbitrator and setting hearing dates. In advance of the hearing, however, Exelon argued that retirees were not part of the bargaining unit (which is technically correct ) and that Exelon did not have an obligation to bargain with its union with respect to the current retirees.

Exelon filed a declaratory judgment complaint, asking the court to declare that any dispute over Exelon's decisions to modify retiree medical benefits was not subject to arbitration under the collective bargaining agreement. The union, represnting a handful of retirees, opposed the claim, probably because it realized that arbitration was its only avenue to protest the changes, given the discretion the company would have in a lawsuit.

The district court ruled in favor of the union, and the Seventh Circuit agreed. The court noted that when a collective bargaining agreement says that disputes over interpretation are subject to arbitration, such a clause includes disputes over retiree medical rights that the collective bargaining agreement confers. Once the company entered into a collective bargaining agreement that included language giving rights to retirees and coupled that with a broad arbitration clause, the company consented to an arbitration of grievances brought on behalf of retirees.

And the union does not have to get the consent of all the retirees under such a circumstance before proceeding. In fact, the Seventh Circuit noted that unless the retirees are themselves suing, and the union is proceeding along a parallel track representing another group of retirees over the same issue, the company cannot block an arbitration request by the union on behalf of even just one employee. The court held that the arbitrator's decision would be final and binding as to the parties of the arbitration, which is all that is contemplated by the collective bargaining agreement. Conceivably, the union could bring such grievances over and over again, or it could bring the grievance on behalf of a few employees, and then let the remainder go into court to try to enforce their rights.

The key issue here, of course, is that the company somehow ended up linking retiree benefits to the collective bargaining agreement. It is absolutely imperative that companies negotiating these kinds of agreements state clearly and forcefully in the collective bargaining agreement or in MLAs associated with it, that the rights of the retirees are not part of the collective bargaining agreement, or will end with the end of the term of this particular collective bargaining agreement, and that the company will retain discretion at all times to modify its retiree medical plans as it sees fit.

The Mixed-Motive Minefield of Employment Discrimination

Lou Michels — Mon, 25 Aug 2008 19:31:00 GMT

A recent case out of the 6th Circuit starkly demonstrates the problems for an employer where the plaintiff alleges a mixed-motive discrimination case. In laying out how these kinds of claims are going to be handled in the 6th Circuit, the court sets up an extremely difficult standard for an employer and virtually guarantees that these cases will go to trial.

The plaintiff was an employee at Baxter Healthcare and received a bad evaluation following several good years of performance. The bad evaluation limited the employee's raise and he brought suit alleging race discrimination.

Of particular interest is the fact that the employee claimed that the decision to downgrade his performance evaluation was motivated "at least in part" by his race. The court found that the employee was raising a mixed-motive claim under 42 U.S.C. § 2000e-2(m), which permits a plaintiff to show that the employer used a protected factor (in this case, race) as a "motivating factor" for the adverse employment action, although other factors also motivated the decision.

Mixed-motive cases are a semantic tangle that confuse employers, lawyers and courts alike. The Supreme Court cleared up some of the problem in 2003 in a case called Desert Palace, but the issue the 6th Circuit was confronting, namely what proof framework to use, did not arise in the Supreme Court case.

In this case, the 6th Circuit decided that it would not use the venerable McDonnell Douglas framework to assess a mixed-motive case. Instead, the court took an employee-friendly position, holding that all a plaintiff had to do to defeat summary judgment was to show that race (or any other protected factor) "was a motivating factor", among several others, in the employment decision. In other words, the ultimate question for the court is "whether there are any relevant issues of material fact concerning the defendant's motivation for its adverse employment decision". This standard is extremely low for a plaintiff because inquiries regarding what typically motivates an employer's decision are very fact intensive and are difficult to resolve at the summary judgment phase. As a result, the vast majority of mixed-motive cases will not end at summary judgment and will go to a jury.

That's exactly what happened in this case, where there was at least some anecdotal evidence that the supervisor responsible for writing the evaluation made some racially insensitive remarks.

I can imagine that most plaintiffs would try to bring their cases under a mixed-motive standard if possible. Such an analysis almost guarantees the employer will face the expense of trial and would be a powerful settlement bargaining tool. Several other circuits have followed this type of reasoning, at least, in part. I wouldn't be surprised to see a lot more of these cases popping up given this type of analysis from the bench.

Sleeping Is a Major Life Activity

Lou Michels — Mon, 25 Aug 2008 17:26:00 GMT

The heading is probably not news to most of us--sleeping has always figured prominently in my overall daily schedule. And not being able to sleep creates a real problem for most people.

The court of appeals in DC recently ruled that sleeping is a major life activity under the Rehabilitation Act, the federal employer version of the ADA. The case marked the first time that this court put sleeping in this category. The interpretation is not novel--other courts and the EEOC regulations support such a determination. But the court did more than simply expand the RA's coverage. The court also eased the burden of someone who can't sleep to file a claim against his employer.

The case involved an FBI trainee with diagnosed post-traumatic stress disorder resulting from being held hostage in his mother's house by an armed robber/rapist two years before the plaintiff entered the academy (note--PTSD is an over-diagnosed psychological conditions; it comes up again and again in employment cases as a result of such mundane things as people being criticized about their work product--but at least in this case, the trauma appears to meet the criterion for the condition). The trainee satisfactorily completed his classes and the PTSD was apparently treatable. But the trainee obsessed over his behavior during the hostage incident and lost an appreciable amount of sleep during his training because he was unable to get an FBI assignment closer to home. The FBI ultimately terminated the trainee after learning of the PTSD diagnosis, for a variety of reasons that, up until that time, had not been an issue.

The court of appeals found that sleep was a vital life activity in its own right, and that receiving two to four hours of sleep per night for five months was a significant restriction on the ability to sleep. Perhaps as importantly, the panel also found that the employee did not have to show an effect on work performance because of the lack of sleep; the inability to sleep was sufficient to establish the disability protections of the Rehabilitation Act. The court also determined that expert testimony was not necessary to establish the impact or the disability; in this case, the employee would be allowed to testify on his own about how little sleep he had.

The FBI did not help its position by claiming that it had dismissed the trainee because of a lack of "emotional maturity" and "cooperative spirit." The court noted that this kind of generic and non-specific criticism could readily be perceived as a pretext for PTSD-based bias.

So the disability here that interferes with a major life activity is the PTSD, which stops someone from sleeping. Employers should be aware that someone with some type of sleeping disorder has already jumped through the very difficult ADA hoop of establishing that they are disabled.

Infertility Treatments Are Not Gender Neutral

Lou Michels — Mon, 25 Aug 2008 15:33:00 GMT

A recent 7th Circuit pregnancy discrimination case is instructive on several bases. The plaintiff began missing time from her job to undergo in vitro fertilization, a treatment that takes weeks to complete. As is often the case, the initial treatment was unsuccessful and the plaintiff applied for a second leave of absence about four months after her first 27-day absence.

The employer was consolidating its staffing around this time and decided to eliminate several positions. Of course, one of the candidates for consolidation was the position occupied by the plaintiff. The employer decided to retain another woman who was performing the same job, but who had not missed as much work.

The plaintiff's immediate supervisor told her about the decision and, in classic "let's raise an issue of material fact" style, told the plaintiff that the termination was in her best interest “due to her health condition." The supervisor also discussed the termination with the human resources manager, and the HR manager recorded in her notes that the plaintiff "missed a lot of work due to health" and noted poor job performance because of "absenteeism - infertility treatments." The company terminated her employment approximately two weeks before the plaintiff was scheduled to go out on her second in vitro absence.

The district court granted summary judgment to the employer because it believed that fertility alone was a gender-neutral condition and, therefore, the employer could not be found guilty of violating the Pregnancy Discrimination Act when it considered fertility remedies as a basis for its decision. The 7th Circuit had no trouble reversing the district court's determination, noting that an adverse employment action based on absence related to pregnancy or pregnancy treatment violates the statute. The employer's legitimate basis for the termination, i.e., the office consolidation and elimination of a secretarial position, was fatally undercut by the fact that both the supervisor and the human resources director memorialized their focus on the plaintiff's pregnancy as a factor in their decisions. Thus, the case gets to a jury.

Again, referencing an employee's protected status, such as health or pregnancy, conterminously with an adverse employment action, is usually fatal to summary disposition of a case. Notwithstanding the fact that this employer probably thought that it was doing the employee a favor by removing a source of stress from her life, referencing these kinds of considerations is a surefire way to find yourself explaining it to a jury.

RIP ADA As We Know It

Lou Michels — Mon, 25 Aug 2008 15:10:00 GMT

Both houses of Congress have now either passed or are seriously considering versions of the so-called "ADA Amendments Act", a fairly sweeping change to the ADA that will greatly broaden the scope of the statute.

I'm really not sure whether I think these changes will fundamentally alter the way ADA litigation is pursued, but there is no doubt that the changes in the law are designed to make more people fall within the "qualified individual with a disability" definition that is the key to claiming benefits under the statute.

For one thing, the amendment states that the definition of disability is to be construed broadly. The amendments put some teeth in that definition by substantially altering the meaning of key terms within the ADA's lexicon. For example, the term "substantially limits", now a key part of the disability definition, now means to "materially restrict" a major life activity. The current standard defined "substantially limits" as preventing or severely restricting a major life activity. "Major life activity" is defined even more broadly and now specifically includes "major bodily functions." Accordingly, a medical condition that materially restricts a major bodily function would be a disability under the amendments. Impairments that are episodic or are in remission are considered disabilities if they would meet the "substantially limits" definition when active. At an extreme, I suppose this would mean that someone who has been successfully treated for cancer (cancer is rarely “cured”, and normally considered to be in remission) is disabled given the fact that active cancer substantially limits major life activities, including bodily functions.

The statute prohibits consideration of the effects of mitigating measures in determining whether an individual is disabled. I’m guessing this means that someone who wears glasses, but that has vision sufficiently poor enough to keep them from driving (a major life activity) without the glasses, would be considered disabled. It will be interesting to see how far that line of reasoning goes, since our aging population is rapidly requiring glasses to do all kinds of things. In an attempt to complicate further a semantic conundrum, the amendments also state that a plaintiff establishing that she is "regarded as" disabled, does not have to show that the subject impairment limits her or is perceived to limit a major life activity, only that she is believed to have such an impairment. On reflection, I have absolutely no idea how that's going to play out in a litigation scenario.

I can only imagine a jury trying to wrestle with instructions in this kind of a situation. Some commentators have indicated that they do not believe these amendments will mean substantially more litigation. Everyone seems agreed, however, that the population of covered individuals is substantially greater under the new law. In my book, that means more litigation.

Addendum: The Senate passed its version of the bill on September 11. The House now gets a look at the Senate version, and is expected to pass it. The President should sign the final version. It will go into effect on January 1, 2009.

Update: The House passed the Senate's version today (September 18), the President's people have said he'll sign the bill.

Perspective on Harassment

Rod Satterwhite — Mon, 11 Aug 2008 12:50:00 GMT

A recent article reported on a Russian judge (the courtroom kind, not an Olympic one) who dismissed a sexual harassment lawsuit filed by a female Russian advertising executive. The judge's rationale: not a lack of evidence, but the alleged need for harassment to foster procreation. As the judge so eloquently stated, "If we had no sexual harassment we would have no children." All I can say is: don't try this defense at home. And especially not in the Ninth Circuit.

In all seriousness, though, the article cites some disturbing statistical and anecdotal information about the commonplace nature of workplace harassment in that country, and provides a sobering perspective on the issue. In our employment defense practice, these days we rarely see the kind of quid pro quo harassment described in the article, and characterized as a regular part of the Russian workplace. Most of our cases arise from allegations of a hostile work environment, but this story should at least serve as a reminder that there are certainly still risks that someone with the wrong attitude about women's roles in the workplace can, in the blink of an eye, get a company into serious trouble. At least in the good old U.S.A.

Not the Best Management Move

Lou Michels — Mon, 28 Jul 2008 16:49:00 GMT

Wal-Mart has long been the whipping boy of the plaintiff’s bar and the news media based in large part on its overwhelming market success. The plaintiff’s bar is constantly looking for a deep pocket (there’s no money in suing poor people) and the mainstream media is generally hostile to anyone doing well in business (who also are some of the same people who insist on newspapers making a profit). But Wal-Mart does an awful lot to bring this stuff on itself, too.

Take the company's latest debacle, which occurred in state court in Minnesota. Wal-Mart’s been ordered to pay $6.5 million to 56,000 current and ex-employees because it did not give them the rest and meal breaks to which they were entitled under state law.

Minnesota, like a number of states, has a baby Fair Labor Standards Act that is more restrictive than the federal statute. The Land of Ten Thousand Lakes requires a meal break during more than eight hours of work, requires payment for breaks that are less than 20 minutes, and requires accurate time records of all of this. Wal-Mart was sued by one of its grill cooks working in the lovely town of Apple Valley (not too far from where I went to high school, in fact). The ex-employee claimed violation of the state statute, as well as being denied the opportunity to use the bathroom and not being paid for actual hours worked.

You are probably thinking to yourself that a failure to comply with legal requirements affecting 56,000 people could not have escaped the notice of Wal-Mart management, and you would be right. In fact, Wal-Mart conducted at least two audits of its work force – 128 stores nationwide, and 6 in Minnesota – to determine the scope of compliance with various wage and hour laws and specifically, the accuracy of employee timekeeping. The audits were thorough. At six Minnesota stores, more than 1,000 meal breaks were unaccounted for and more than 2,600 rest breaks were missing in a one-week period. In other words, either people weren’t recording the breaks, or they simply weren’t being given the opportunity for them as required by the law.

Here’s where the real problem starts. A company that believed it was giving people adequate break time that was improperly recorded would move to correct the reporting deficiencies and do it quickly. Any employment lawyer looking at such an audit would realize immediately that the company was in significant danger of being sued for something that it wasn’t doing, i.e. not providing sufficient breaks.

But that’s not what Wal-Mart management did. Instead of trying to figure out whether it was actually breaking the law or just had sloppy record keeping, Wal-Mart management directed employees to stop recording breaks on their timecards. In other words, when you read bad news, burn the newspaper. This was probably the single most important factor in the court’s determining that Wal-Mart not only was breaking the law, but also knew it was breaking the law at a significant pace.

Minnesota has a long history of employee protection and imposes stiff penalties for intentional violations of its statutes. In this case, the penalties accrue at the rate of $1,000 per violation. That’s in addition to punitive damages. The penalty could total $2 billion, a number that would get your attention on a balance sheet anytime.

The lessons here are pretty obvious. I’ve said before that if I have to pick a statute that my clients are most likely violating, it would be the Fair Labor Standards Act or similar state statutes. Companies need to pay more attention to their timekeeping process and how their policies are actually being applied on the shop floor. They should allow their employees to verify the time records to ensure accuracy and give the employees a means of reporting errors that does not involve their local managers. The company should undertake periodic audits to ensure that the time records are showing compliance. And finally, if you see a problem, don’t try to solve it by making sure the problem can’t be reported to you. Ignorance is not bliss.