- AGENCY IDENTIFIES TOP MISTAKES MADE BY EMPLOYERS THE EEOC'S "NOTORIOUS NINE"
- THINK BUSH IS GIVING YOU A "PASS"? UH...NO.
- NCDOL CLARIFIES "EXEMPT" STATUS OF CLAIMS ADJUSTERS
- GETTING TO KNOW US
- ARE YOU A "PUBLIC ACCOMMODATION"? DO YOU NEED HELP?
- REASON PREVAILS...
- AND REASON FLAILS...
- THE STATES ACCOMMODATION, ORIENTATION, AND DEFEAT OF LEGISLATION
- SARA LEE NAMES CONSTANGY A "PREFERRED PROVIDER"
- QUARTERLY QUIZ
- SEE YOU IN ORLANDO!
- SEE YOU IN SAN FRANCISCO!
- ATTENTION, SYMPOSIUM AND WORKSHOP ATTENDEES!
by Robin E. Shea
For its annual meeting, which took place in the fall of 2002, the American Corporate Counsel Association invited Cari Dominguez, chair of the Equal Employment Opportunity Commission ("EEOC"), to speak and asked that she discuss employers' top ten mistakes in dealing with the EEOC.
Dominguez canvassed her regional attorneys and, the good news was, came up with only nine mistakes-which she tactfully called "judgment lapses" rather than "mistakes." Dominguez was being charitable-these are clearly full-blown mistakes and are worthy of a review, plus the two cents' worth from a defense attorney.
No. 9. They don't communicate. Many employers and their attorneys, said Dominguez, fail to stay in touch with the EEOC while an investigation is taking place. Many of us on the defense side might correctly point out that the Commission is the guilty party at least as often as the employer. That said, Dominguez makes a worthwhile point. Whether fair or unfair, the employers are the ones under investigation and therefore bear the practical burden of showing that they acted properly. Proactive communication with the EEOC investigator builds credibility for the company and for the attorney who represents it.
No. 8. They underestimate. Dominguez says that many employers and their counsel underestimate the competence and professionalism of the EEOC. I will refrain from making a smart comment here because, again, Dominguez makes a valid point. Many employers and defense attorneys assume that the EEOC will not give the employer a fair shake, or that the investigator is not smart enough to identify the relevant issues in a charge. In my experience, this is unfair to most EEOC investigators-although they may have a pro-employee bias (just as most of us have a pro-company bias), most do want to find the truth and be fair to both the employer and the charging party.
No. 7. They're dismissive. This is closely related to No. 8. Apparently, too many on the employer's side assume that the EEOC will not litigate. Although litigation (rather than a dismissal and notice of rights) is definitely the exception, the EEOC has been known to go to court-especially when class relief is possible, when religious discrimination allegations are involved (because many people with deep religious beliefs do not believe in filing suit on their own behalf), or when one of the EEOC's favored causes is at issue (currently, discrimination based on Muslim religion or Middle Eastern national origin). And I can tell you from my own experience that the EEOC is generally a pretty hard-working and effective adversary.
No. 6. They retaliate. Hard to believe that anyone is still doing this-in this day and age!-but Dominguez says that many employers are continuing to retaliate against employees for engaging in activity protected by the anti-discrimination laws. There are two broad categories of activity that are legally protected: (1) participation and (2) opposition. "Participation" includes filing a charge, testifying against the company, and similar activity. "Opposition" includes activity that does not involve a formal process, such as making an internal complaint about discrimination against oneself or co-workers. It is important to remember that retaliation can exist regardless of the strength of the underlying claim. For example, an employee may have a good-faith but legally weak claim of workplace harassment. Even though her claim is weak, it would still be unlawful for the employer to take action against her based on the fact that she made the complaint. It is also possible for a non-protected employee to become "protected" by the retaliation laws-for example, a white male who complains about discrimination against minority women at his workplace. (It is possible to terminate someone for making a bad-faith complaint or for handling a legitimate complaint in a completely unconstructive manner, but this type of termination is legally treacherous and should not be undertaken without thorough legal review.)
No. 5. They don't mediate. I agree with Dominguez-this is a big one. Many of us were skeptical of the EEOC's mediation program when it was introduced a few years ago. We did not believe that EEOC mediators would ever give employers a fair shake. For many of us who gave it a try nonetheless, a most pleasant surprise awaited. In many cases, the mediators are generally quite fair and savvy (see No. 8 above), and have facilitated very economical resolutions for companies. Not every case is suitable for mediation, but more cases are mediation-worthy than you might think.
No. 4. They wait. I know what most employers must be thinking about this one-a government agency actually has the nerve to accuse employers of being slow? But Dominguez is talking about delay as a tactic, not delay caused by heavy workload or negligence. Delay is sometimes a legitimate strategy to reduce liability or achieve other goals. But it is generally not smart, even if legitimate, where an EEOC charge is concerned. Employers should realize that once an employee files a charge, the statute of limitations on the federal antidiscrimination claims stops running until the EEOC disposes of the case. Thus, there is certainly no statute of limitations reason for employers to be dilatory. And, even though the statute of limitations stops, the accrual of back pay and back benefits does not. So the more you drag your feet, the more money you may end up paying to the charging party.
No. 3. They prevaricate. I am glad to say that I don't know any employer who does this, but apparently some EEOC investigators have been bitten. To the extent that employers provide non-coercive advance preparation for their employees before EEOC interviews, or obtain legal representation before responding to charges, this is all perfectly legitimate and more than fair. However, employers who try to improperly conceal witnesses or evidence, falsify documents, threaten potentially adverse witnesses with discipline or discharge (or blacklisting), lie to the EEOC, or engage in other improper activity should watch it-they are hurting no one but themselves.
No. 2. They're not appropriate. This should be no surprise to any employer who is being honest with itself: Dominguez says that we do not always take the appropriate action in addressing discrimination issues and do not always take corrective action when problems arise. Mistakes are unavoidable, but if you get a charge and realize that indeed you had not handled the situation appropriately, begin working to resolve the matter. If you act quickly (see No. 4 above), you may be able to reinstate a wrongfully terminated employee, or resolve the charge with a nominal settlement. If you make this your normal practice when you find that you have done wrong, you will create an outstanding reputation with the EEOC, and they'll often be willing to give you the benefit of the doubt on the cases you are willing to fight.
No. 1. They don't calibrate. The number one complaint from regional attorneys is that employers often fail to proactively monitor their EEO compliance. This is easy to neglect with all the other responsibilities that human resources professionals have. But wise employers will do all that they can to monitor the demographics of employment activity, especially for jobs that seem to be "segregated" by race or sex; keep EEO and harassment policies up to date; have good processes in place for employees to complain if they believe that they have been treated unfairly; and provide effective management training on employee relations, discipline and discharge, discrimination, reasonable accommodation, retaliation, and harassment. For larger companies, it is also advisable to monitor legal actions filed against the company (including lawsuits and administrative charges), even if frivolous, because heavy activity may indicate serious morale or perception issues if not bona fide discrimination issues.
And a few from the defense side. I would respectfully add the following to the EEOC's list:
- Don't assume, just because the EEOC is suing (see No. 7), that you have done wrong. The EEOC isn't always right, either, and you can win an EEOC lawsuit -especially if they seem to be litigating only because you happen to be on the wrong end of one of the agency's "hot" causes.
- Although you should not underestimate the competence and professionalism of the EEOC, don't overestimate it, either. Especially when writing your Statement of Position, be sure that you fully and in plain language explain all relevant background information and your position. You will generally not go wrong by trying to make the investigator's job easy.
- Don't try to avoid liability by claiming that a termination for cause was a "job elimination." This trick has been tried many times, and the EEOC is onto it. If you fired someone for a good reason, have the courage to admit it. If the person was terminated partly for cause and partly for economic reasons, say that. You will have a much easier time defending yourself if you're straight-up.
- Don't think the EEOC is being adversarial every time it asks you for information. Often, when the EEOC asks for more information, it is 99 percent ready to throw out the charge (that is, to find in the company's favor) and just needs one small item from you to wrap the thing up. Thus, unless the request is truly unreasonable, comply politely. When in doubt, consult with counsel.
- Speaking of adversarial, generally don't be with the EEOC. Some investigators require an adversarial touch, but these are in the minority. Most will be much easier to deal with if you are courteous and pleasant with them. Even if you disagree with their position or don't intend to provide certain information they've requested, you can "say no" respectfully.
- Last but not least, don't handle even a seemingly trivial charge without the help of counsel. Here are examples of some mistakes that can turn little charges into big disasters: Inadvertently admitting to violation of a non-EEO law, providing too much information that allows the Commission to go fishing for trouble, representing "facts" that turn out to be untrue. Or, of course, committing any of Dominguez's "Notorious Nine."
Robin Shea (Winston-Salem, NC) practices in the areas of litigation prevention and defense, affirmative action, and employer training.
THINK BUSH IS GIVING YOU A "PASS"? UH...NO.
Many employers (and their lawyers) breathed a sigh of relief when Bush was declared the winner of the 2000 election.
Although the government now seems to be taking more reasonable positions on many employment issues, employer complacency is far from warranted. Here is a review of some of the developments in the labor and employment world since Bush took office:
- Class action litigation, particularly under the Fair Labor Standards Act, has increased since Bush took office. (Two years ago, our own Jim Coleman, of the Arlington, VA office, predicted that this would be the hot new area of litigation, and he has been proven right.)
- Sarbanes-Oxley was enacted, imposing stringent ethical requirements on publicly-traded companies and creating a new cause of action for retaliation.
- The EO Surveys, which request affirmative action and compensation data sorted by race and sex, are continuing to be required of federal contractors. Data from the surveys are used to select employers for compliance audits by the Office of Federal Contract Compliance Programs.
- The Supreme Court has expanded the definition of "continuing violation" in hostile work environment harassment cases, in effect lengthening the statute of limitations on such claims and making it harder for employers to get the claims dismissed.
- According to the latest statistics from the Equal Employment Opportunity Commission, charges increased 4.5 percent during fiscal year 2002.
- Speaking of the EEOC, it just helped achieve a $250 million settlement with the state of California Public Employee Retirement System in an age discrimination case involving disability benefits for public safety employees. Although the litigation began during the Clinton Administration, the size of the settlement shows that the Bush Administration was hardly a pushover.
- Oh, and two more words: HIPAA. Privacy.
Meanwhile, many employers have lapsed into a false sense of security and have curtailed their preventive programs, including internal audits, employee and management training, and legal consultation before carrying out reductions in force. The current legal climate coupled with employer complacence is a dangerous combination.
It is a mistake to think that the current Administration is letting employers have a free pass. Bush is conservative, to be sure, but he also prides himself on his "compassion." He has worked hard to reach out to African-Americans, Hispanics, and other minority groups, and he isn't about to jeopardize his slow-but-steady progress by being a "country club" Republican who ignores equal-rights issues.
If you don't believe me, ask Trent Lott.
Robin E. Shea, Editor
A recurring problem under the wage and hour laws has been whether insurance claims adjusters are exempt from minimum wage and overtime provisions of the Fair Labor Standards Act ("FLSA").
A recent opinion letter from the United States Department of Labor ("DOL") may cause insurance companies to breathe easier. Although the opinion, issued November 19, 2002, is based on the factual representations concerning the job duties of the specific claims adjusters for whom the opinion was sought, the DOL said that the administrative exemption from the minimum wage and overtime provisions of the FLSA would apply.
Section 213(a)(1) of the FLSA provides an exemption from the FLSA's minimum wage and overtime provisions for employees employed in a bona fide executive, administrative, or professional capacity. The DOL's implementing regulations provide that the administrative exemption applies to an employee
- who is compensated on a salary or fee basis at a rate of not less than $250 per week;
- whose primary duty consists of the performance of office or non-manual work directly related to management policies or general operation of his employer or his employer's customer; and
- whose primary duty includes work requiring the exercise of discretion and independent judgment.
The DOL outlined the specific duties of the claims adjusters at issue and noted that their duties, including planning, advising management and representing the company in negotiations, related to servicing the business. These duties were characterized as "related to management policies or general operation" of the company and thus related to the administrative operations of the business as distinguished from production work.
The DOL also found that these particular claims adjusters exercised "discretion and independent judgment" with regard to important matters that affected the business operations to a substantial degree. "Discretion and independent judgment" involve the comparison and evaluation of possible courses of conduct, with authority to make an independent choice, free from immediate direction or supervision. These adjusters made decisions regarding coverage and liability, negotiated with full authority to settle or resolve the claim, and worked with counsel to represent the company even after litigation ensued. Thus, the DOL determined that they were not merely pursuing a standardized format for resolving claims, but rather were using their own judgment about what the facts showed, who was liable, what the claim was worth, and how to handle the negotiations.
"Discretion and independent judgment" is to be distinguished from the mere use of skill in applying standardized or well-established techniques and procedures. It cannot be emphasized strongly enough that this analysis must be performed on a case-by-case basis, and that many claims adjusters will lack the sufficient discretion to qualify for the exemption.
The DOL's opinion is consistent with its long-standing position concerning the application of the administrative exemption in general, and as applied specifically to claims adjusters. In fact, the DOL regulations specifically identify claims adjuster as a job that ordinarily satisfies the test for exempt administrative work. See 29 C.F.R. § 541.295(c)(5).
Employers should be cautioned, however, that the administrative exemption cannot be broadly applied, even with respect to claims adjusters. Claims adjusters who are given limited authority to settle matters, or who are constrained in their discretion and judgment by detailed standards and rules, may not qualify for the exemption. Moreover, claims adjusters who work for entities whose very business product is the provision of claims adjusting service, are engaged in production work and will not satisfy the administrative exemption requirements. (A similar distinction arises in the legal field. Paralegals working in-house for a company often qualify for the administrative exemption. In contrast, a paralegal at a law firm is generally a production employee, and thus cannot meet the administrative exemption.)
Rob Floyd (Arlington, VA) practices in the areas of wage-hour compliance, litigation prevention and defense, employee benefits, and independent contractor/employee issues.
MEL HAAS (Macon, GA, labor relations and employment advice) is the head of Constangy's Macon office. He received his bachelor's degree in chemistry from Emory University and his law degree from the University of Alabama. Before Mel entered private practice, he was a Judge Advocate General in the U.S. Air Force and a trial attorney for the National Labor Relations Board. Mel is on the Board of the Georgia Defense Lawyers Association. He has written several articles regarding labor and employment law and spoken at numerous seminars on the same subject. When he is not practicing law, Mel enjoys golf, running, fly fishing, and traveling. Mel and his wife, Linda, have two daughters and three grandchildren.
MAUREEN KNIGHT (Arlington, VA, employment litigation prevention and defense, wage and hour, and affirmative action) began her career as a paralegal in Constangy's Arlington office and earned her law degree from George Mason University School of Law while continuing to work for Constangy. (She also won the Betty Southard Murphy Award in labor law, was a moot court finalist, wrote and published a piece for the Washington Legal Foundation, and had a baby ten days after taking - and passing - the bar exam.) Maureen is a magna cum laude graduate of Strayer University with a degree in computer information systems. Maureen's hobbies include gardening and playing soccer. She and her husband, Craig, enjoy their "bar-exam baby" (now one year old).
KERRI REISDORFF (Kansas City, MO, labor relations and employment advice) received her bachelor's degree in criminal justice from the University of Nebraska and her law degree with distinction from the University of Nebraska at Lincoln. While in law school, Kerri was an Executive Editor of the Nebraska Law Review, and a member of the Moot Court Advisory Board, and received the University Superior Scholar Award. Kerri is learning to play golf, and she also enjoys running, traveling, and anything having to do with University of Nebraska football.
CHUCK ROBERTS (Winston-Salem, NC, labor relations and employment advice) graduated from North Carolina State University with a bachelor's degree in textile technology. He then went on to the University of North Carolina at Chapel Hill, where he received his MBA and law degree with honors. When Chuck is not practicing law, he enjoys mountain biking and hiking. He and his wife, Dianne, have a seven-year-old daughter and have just adopted an eight-month-old daughter from Armenia.
CAROL SUE NELSON (Birmingham, AL, employment litigation prevention and defense, and training) has been an attorney in our Birmingham office for 22 years. She received her bachelor's degree in political science from Auburn University and her law degree magna cum laude from Cumberland School of Law and clerked for a federal judge. Carol Sue is President of the Auburn University Bar Association, and a member of the Dean of Liberal Arts Advisory Council at Auburn University and the Eleventh Judicial Circuit Lawyers' Advisory Committee. She is a panelist on the Northern District of Alabama's Panel of Neutrals for the Court's ADR Plan and member of the Women's Network. When she is not practicing law or in one of her many meetings, Carol Sue enjoys golf, horseback riding, and spending time with her husband, Chris, and her two sons.
Claims for discrimination in public accommodations under Title III of the Americans with Disabilities Act are on the rise, particularly in states like California, Florida and Texas, which are home to active disability advocacy groups. For six years after the ADA's enactment in 1990, reported public accommodation cases averaged less than 10 per year. The number of published cases tripled during 1997 and 1998, quadrupled in 1999, and has continued to climb through 2002.
Title III is best known for its application to traditional places of public accommodations, like hotels and restaurants. The statute, however, also covers a broader range of commercial facilities, private entities engaged in public transportation, and entities offering examinations or courses for certain educational, professional, or trade purposes. Indeed, those hardest hit by public accommodation lawsuits - including class actions - have been health care providers, educational facilities, testing and licensure entities, the travel industry (especially cruise lines), and entertainment and recreational facilities such as theaters and stadiums.
Similarly, most people know that Title III addresses physical barriers that might limit access to public accommodations. But, the statute actually reaches far beyond architectural or construction concerns. Lesser known provisions forbid the use of eligibility criteria that tend to screen out disabled individuals, require policy or procedural modifications and other affirmative steps to afford equal enjoyment to those with disabilities, and prohibit discrimination against those who associate with disabled people, retaliation against those who speak out under the ADA, and inference with individuals seeking to exercise their rights under the Act. Constangy attorneys are available to help with your company's public accommodation issues.
Jill Stricklin Cox (Winston-Salem, NC) practices in the area of litigation prevention and defense.
Plaintiffs from Mars...and Venus. A court in New York threw out a lawsuit in which the plaintiff claimed that he was discriminated against, in part, because he was Jewish. The allegedly anti-Semitic employer was Hebrew Union College-Jewish Institute of Religion.
Duh. The Fifth Circuit (Mississippi, Louisiana, Texas) held that evidence of sexual advances to members of one's own gender is credible proof of homosexuality.
The ADA's good name is restored! The First Circuit (Maine, Massachusetts, New Hampshire, Rhode Island and Puerto Rico) affirmed dismissal of a lawsuit filed by an alcoholic who was terminated while he was in jail for drunk driving.
They hate me 'cuz...'cuz I'm a guy! Yeh, that's the ticket! The Seventh Circuit (Illinois, Indiana, Wisconsin) affirmed judgment against a teacher whose contract was terminated. The teacher claimed he was terminated because he had filed a reverse-sex discrimination charge against the school system, but the evidence showed that he was chronically tardy, failed to attend faculty meetings, failed to produce lesson plans, and had disciplinary and academic problems.
Illegal wiretapping!! The man on the flying trapeze!! Adultery!! Bearded ladies!! The D.C. Circuit overturned a verdict for an employee of the company that owns the Barnum & Bailey/Ringling Brothers Circus. The employee alleged that her boss-with whom she was having an affair-had illegally wiretapped her home and work phones. The verdict was overturned on the disappointingly mundane ground that her lawsuit had not been filed within the two-year statute of limitations.
Bad poets society, Part I: He can rhyme, but he ain't got no rhythm. Pennsylvania Supreme Court justices publicly object to the dubiously poetic opinions of their colleague, Justice J. Michael Eakin. Here's a sample: "Given his accomplishment and given her youth/Was it unjustifiable for her to think he told the truth?" (This guy is awesome!)
Love of tofu is not a religion. The California Court of Appeals held that veganism is not a "religious creed" within the meaning of the California Fair Employment and Housing Act. The plaintiff was denied a job with a pharmaceutical company after he refused to be inoculated with a vaccine grown in chicken embryos.
Bad poets society, Part II: Gangsta arbitrayta upheld. A court in Illinois upheld the reinstatement of an amateur rapper who left obscene, anti-woman, and violent rap lyrics at work where his co-workers found them-even though the would-be P. Diddy had already been warned three times and even though the lyrics clearly violated the company's policies against harassment.
Employer must pay "retention bonus" to employee who stays home. An employer offered a retention bonus to employees who stayed with the company while a takeover was in process. One employee "stayed" but was out on FMLA leave for 12 weeks during the relevant period. The court, also in Illinois, found that the employer violated the FMLA by reducing her retention bonus for the time that she wasn't at work.
New York makes it unlawful for employers to impose circumstances that would require an employee to forgo religious observance as a condition of employment or promotion . . . North Carolina expands employers' reasonable accommodation obligations under its disability discrimination statute . . . Boston, Massachusetts, and Cook County, Illinois (Chicago) ban transgender bias . . . Denver, Colorado bans sexual orientation and "gender variance" discrimination . . . Cincinnati, Ohio, and New York City enact "living wage" legislation . . . meanwhile, voters in Santa Monica, California defeat "living wage" legislation . .
Constangy is pleased to announce that it has been designated a preferred provider of legal services by longtime client Sara Lee Corporation. The designation was in recognition of Constangy's internal diversity efforts. We appreciate the recognition from Sara Lee and look forward to continuing our long and mutually beneficial relationship.
Jones Company has a policy prohibiting employees from discussing their salaries with each other. Chattie discloses her salary to a lower-paid peer, which causes the co-worker to file a charge against the company for pay discrimination. Chattie is terminated for violating policy. Is this legal?
QUARTERLY QUIZ ANSWER
No. Terminating an employee for disclosing his or her own salary could violate a number of laws, depending on the circumstances. Such a policy could give rise to violation of the Fair Labor Standards Act, the Equal Pay Act, state wage and hour laws, and the protected concerted activity provisions of the National Labor Relations Act. In this case, Chattie's disclosure could be protected "opposition activity" prohibited by the anti-retaliation provisions of the anti-discrimination laws. In fact, the National Labor Relations Board has held that the mere existence of a policy prohibiting discussion of salary information is unlawful.
Constangy, Brooks & Smith will once again be a major sponsor of the national conference for the Society for Human Resources Management (SHRM), to be held this year in Orlando, Florida. If you or others in your company are planning to attend SHRM's annual gathering on June 22-25, please send an e-mail to firstname.lastname@example.org or alert your Constangy attorney. We'd love to see you at our Cocktail Reception, Monday evening, June 23, at the Rosen Plaza, adjacent to the convention center!
Our firm is also proud to be a Gold Sponsor of the annual meeting of the American Corporate Counsel Association (ACCA), slated for October 8-11 in San Francisco. If you're planning to attend, notify email@example.com or your Constangy attorney, and you'll receive details about our special function for clients and friends during the conference. Hope to see you there!
For those of you familiar with the firm's past Symposia or Regional Workshops, please take note! To earn continuing education credits, learn the latest in employment law trends and tips, and network with colleagues and firm attorneys (or to just get a breather outside of the office), clients and friends will have more dates and places to choose from in 2003 than ever before. Constangy, Brooks & Smith will present affordable one-day labor and employment law Workshops in nine cities. Please watch your mail and our website, www.constangy.com, for details on dates and locations in Tampa and Jacksonville, Florida; Sea Island and Atlanta, Georgia; Charlotte and Greensboro, North Carolina; Nashville, Tennessee; Birmingham, Alabama; and Kansas City, Missouri.
In "Out With the Old, In With the New: Managing Your Workforce Through the Ages-From Baby Boomers to Generations X, Y and Beyond," lawyers will present entertaining and informative programs on a host of topics. Issues will include advanced FMLA strategies; managing the aging workforce; dealing with employees' workplace injuries and disabilities; whistleblowers and retaliation; collective bargaining; and many more. Please plan to attend one of our Workshops near you... or somewhere else that just sounds like fun!