Posted by marykeating on April 30, 2010 under disability discrimination, retaliation | 
William Blake sued Baltimore County in 2007 for retaliation. Blake had testified, after being subpoenaed, in a case brought by a fellow officer claiming to have been forced into early retirement in violation of the Americans with Disabilities Act. The next day the County ordered him to report to its chosen physician to determine if he was fit for duty. He was also ordered to bring voluminous medical records. Officer Blake felt compelled to comply with the order, since if he defied his superior he could be fired. But he was quite disturbed by the intrusion into his medical history.
The asserted reason for this exam was a ten-year old single instance of a seizure, which the County had not revisited since it happened until the date after Officer Blake’s testimony. The County’s physician concluded that his physical condition presented no obstacle to his continuing to work. The County followed up with further orders to undergo tests.
Officer Blake presented a classic case of retaliation for participating in a proceeding alleging discrimination. While retaliation has always been illegal, the courts for many years narrowed the ability to pursue a retaliation claim by requiring the retaliation to take the form of a tangible employment action, typically firing or demotion. So the employee who was moved to a tiny office and given no work to do was unable to pursue a retaliation claim.
That was the case until the Supreme Court widened the definition in the case of Burlington Northern & Santa Fe Ry. Co. v. White, 548 U.S. 53 (2006). In that case the Supreme Court instructed that illegal retaliation occurs when the retaliatory treatment would dissuade a reasonable employee from making or supporting a discrimination claim in the future. It contrasted the anti-discrimination and the anti-retaliation provisions of the laws forbidding workplace discrimination: the anti-discrimination provision “seeks to prevent injury to individuals based on who they are,” while “the anti-retaliation provision seeks to prevent harms to individuals based on what they do.” Therefore, the types of retaliation that could chill the exercise of rights is much broader, and not necessarily limited to the workplace.
Since Officer Blake continues to work for Baltimore County, the jury sitting in federal court in Baltimore awarded him damages based solely on his emotional distress. Kudos to his lawyer, my friend Kathleen Cahill, for helping him obtain justice.
Posted by marykeating on April 29, 2010 under Federal wage and hour law, Pending legislation |
I’ve discussed misclassification of employees before. The issue comes up when an employer decides to treat a worker as an independent contractor when the person actually qualifies as an employee. The savings to the employer include worker’s compensation premiums, unemployment insurance premiums, the employer share of the social security and medicare taxes, and, often, the cost of fringe benefits. In addition, an employee has protections under various non-discrimination laws which usually do not apply to independent contractors.
Congress now has before it a new version of The Employee Misclassification Prevention Act. It was introduced last week, and is expected to get a favorable hearing.
The law would add enforcement teeth to the Fair Labor Standards Act. One provision adds a presumption that someone receiving money for the performance of work is an employee, unless the employer has maintained records related to the classification and the hours worked and wages paid. In addition, the misclassified employee will be entitled to doubled liquidated damages for that violation. In other words, the amount recoverable by the misclassified employee could be triple the unpaid or underpaid wages, as is the case in state law.
Maryland is targeting specific industries, such as the landscaping industry, believed to have rampant violations. The new federal bill requires the Department of Labor to engage in targeted audites of industries the department finds to have a frequent incidence of misclassification.
Posted by marykeating on April 27, 2010 under Gender orientation discrimination |
Wal-Mart is hoping the Supreme Court will take on its efforts to avoid trying a half million or more sex discrimination cases in a single lawsuit. On Monday, the Ninth Circuit Court of Appeals allowed the class action suit to go forward. Fittingly, given Walmart’s status as the largest private employer in the country, it’s the largest class action ever certified. All women employed by Wal-Mart any time after December 26, 1998, were members of the original class action. The new decision certifies as a class all currently employed females with claims that they have been paid less than men, or have been unfairly passed over or made to wait for promotional opportunities as compared with men. This class is eligible to present their claims for back pay and injunctive relief. The trial court will be asked to consider the extent whether to certify the punitive damages claims, and the claims of women who were members of the original class but who no longer work at Wal-Mart.
The case is important for the scope of the claims. The decision pointed out that size alone could not drive the decision to certify a class or make each discrimination case proceed alone. Instead, the issue in class action certification is whether the common issues to be decided predominate. The majority of the Ninth Circuit noted that the trial court had found “significant evidence of company-wide corporate practices and policies, which include (a) excessive subjectivity in personnel decisions, (b) gender stereotyping, and (c) maintenance of a strong corporate culture; (2) statistical evidence of gender disparities caused by discrimination; and (3) anecdotal evidence of gender bias.” 
The 137-page opinion can be accessed through the class action’s website, as can information related to joining the class.
According to one source, the Supreme Court is likely to take an interest in the case. If so, the case will linger for a few more years before any proof is heard.
Posted by marykeating on April 24, 2010 under Economic situation, Employment benefit issues |
Last week, Congress again extended the reach of the COBRA subsidy. As reported here before, the subsidy was part of the legislation designed to jump start the economy and ease the pain of the unemployed. Instead of paying the full freight of health insurance (plus a two percent administrative fee), the newly unemployed person could pay only 35% of the health insurance premium. The employer paid the rest, and could take an offset from the withholding tax owed to the federal government. In other words, the government pays for the majority of the premium.
This program has been extended not only to last for fifteen months, from the earlier nine, but also applies to those laid off in April or May of 2010. The subsidy is available for people who lose their jobs, not those who quit.
Posted by marykeating on April 22, 2010 under Employment benefit issues |
“People make mistakes.” Says the Chief Justice of the Supreme Court. He’s not talking about himself, but about ERISA plan administrators.
The case of Conkright v. Frommer sees Chief Justice Roberts singing the praises of employee benefit plans that give deference to their administrators to interpret plan provisions, coverage, and other issues. In this case, a pension plan administrator had made a calculation of pension benefits that the court found unreasonable. In their return to court, the pension plan participants objected to the replacement calculation. They urged the trial court to deny discretion to the plan administrator’s new calculation method, and to itself determine the appropriate level of benefits. The trial court agreed, and determined a method of calculating benefits as proposed by the pension beneficiaries.
The Supreme Court overturned the decision, faulting the trial court for not granting discretion to the administrator. In doing so, it expressed with approval the “efficiency” of granting the administrator discretion, since it prevents different courts from having a role, which could lead to different decisions. The opinion omits any benefit to the participants by having impartial courts determining their entitlement to benefits, many of which are paid for by the employees. Under the Court’s majority opinion, the administrator must commit multiple breaches of trust before the court can step in and take away its discretion. In any event, one free mistake is now the rule.
This approach tilts the scale too heavily in favor of the benefit plan trustee. In the pension situation, the trustee ideally attempts to pay out all beneficiaries at the levels promised by the plan, investing the funds prudently yet profitably so that retirement funds are available. In this ideal situation, there are no winners or losers, everyone gets what they should get.
Contrast another common ERISA case subject: the long-term disability plan. In those cases, the employer, with or without employee contribution, pays premiums for a long-term disability policy. Under the policy, an employee is entitled to obtain benefits if she becomes totally disabled. As with all insurance products, the insurance company underwriting the policy is hoping that premiums will outweigh the benefits paid. In many cases, the insurance company is also the administrator of the plan, invested with discretion to decide if someone is disabled, or otherwise qualifies for the benefits. Is there any surprise that long-term disability benefits are frequently denied?
Justice Breyer, who delivered the majority opinion in 2008′s Metropolitan Life Ins. Co. v. Glenn, dissented.
Posted by marykeating on April 20, 2010 under Discrimination in employment |
Yesterday the Supreme Court agreed to decide a case involving the “cat’s paw” theory of discrimination. The case will be argued and decided next term, so Justice Stevens’ replacement should be on board by then (barring a major Senate gridlock). This theory of discrimination allows a plaintiff to show that, even though the decision maker who fired him was not biased against him, the biased person had influence over the decision or the decision maker. The colorful name derives from a short story about a monkey who convinces a cat to retrieve chestnuts from the fire. The monkey gobbles them up, but the cat has the burned paws.
This pops up in a lot of employment contexts. A supervisor may not have the power to fire his subordinates, but he certainly has the power to write them up and do their evaluations. If this person dislikes a subordinate because or his race or religion, for example, he can wage a campaign to get rid of the person. He can make up stories or exaggerate encounters so that the person can be called “insubordinate,” or “a poor team player. “This influence may be exercised
by, among other things, ‘supplying misinformation or failing to provide relevant information to the person making the employment decision.’”
The quote is from the case that the Supreme Court will hear, Staub v. Proctor Hospital. Staub alleges that he was fired for being a reserve member of the military. This action violates the Uniformed Services Employment and Reemployment Rights Act (USERRA). Staub showed that one of his supervisors found his military schedule problematic and wanted him fired. He won at trial, but the Seventh Circuit decided that there was too much evidence that the decision maker was independent of the biased subordinate’s influence, and used other, non-discriminatory reasoning to support his firing. The appellate court reversed his win.
It is never safe to predict why the Supreme Court takes a case, or which way it will rule. The Seventh Circuit faulted the trial court for not making a preliminary decision about whether there was enough evidence of “singular influence” by the biased supervisor to permit the cat’s paw theory to be presented to the jury. The Supreme Court may focus on that issue, or may decide to bless or damn the entire theory. Either way, it will be helpful to have guidance on the use of this theory of discrimination.
Posted by marykeating on April 17, 2010 under Employment benefit issues |
The Supreme Court will decide a case centering on the award of attorney’s fees in a long-term disability appeal. The Fourth Circuit, which hears appeals from federal courts in Maryland, decided that the successful claimant could not obtain attorneys’ fees from the insurance company. While the case will focus on a narrow provision of one law, ERISA, it has widespread ramifications. The case is called Hardt v. Reliance Standard Life Ins. , and discussed here.
ERISA is the acronym for the Employee Retirement and Income Security Act. This law governs employee benefit plans, including not only pensions but health insurance, life insurance, and long-term disability insurance. Among its provisions is a requirement that the benefit plan offer an internal administrative appeal procedure when claims are denied.
Long-term disability plans are frequently offered as fringe benefits. As many people have found, however, the administrators of these plans can be very suspicious of claims, and may deny benefits to claimants on dubious grounds. The administrators are often the same insurance companies who will pay the claim if they decide the claim is valid. A disabled person can go to court only after “exhausting” the administrative remedies (the word used by the courts is especially appropriate here). Then the court will review the decision of the administrator by comparing the definitions of the plan, the medical evidence, and the administrator’s reasoning. Ordinarily the disabled employee cannot add more information in court, so developing a good administrative record is key. 
Bridget Hardt’s experience followed a path I’ve seen many times. Her injuries and subsequent health issues prevented her from working, according to her and her doctors. The Social Security Administration agreed that she was unable to work and granted her benefits, but the long-term disability plan administrator did not agree. She filed suit under ERISA, and the federal court instructed the administrator to reconsider the evidence. It relented at that point, and gave her benefits through retirement age.
Under ERISA, a court may order a party to pay the other person’s attorney’s fees if the case was successful. These fee-shifting statutes are designed, in part, to encourage attorneys to take cases for people who might not be able to afford representation. The federal court in Ms. Hardt’s case awarded attorney’s fees to her; but the appeals court disagreed, holding that the administrator’s reconsideration did not result in a judgment in favor of the claimant, so Ms. Hardt did not qualify as a prevailing party. In other words, her success on the claim was not the result of a court order telling the administrator to pay the claim.
Because other federal courts have taken the opposite view, and because ERISA cases frequently arise in federal court, the Supreme Court has decided to resolve the question. It would be unfortunate if the Supreme Court takes the narrow view adopted by the Fourth Circuit. It is difficult for someone to battle an insurance company, and sometimes the nature of the employee’s disability makes it even harder to jump through the company’s hoops. A lawyer can be helpful to formulate the arguments and amass the evidence that might lead the insurance company to agree with the person’s doctor that she’s disabled. When the administrator agrees during that administrative process, attorney’s fees are not recoverable. But if they make a federal case out of it, it seems fair to make the insurance company pay for the successful person’s fees, even if the success does not stem from a judgment.
The decision should be issued by the end of June.
Posted by marykeating on April 16, 2010 under Discrimination in employment, Employment benefit issues |
If you were unable to follow the twists and turns of the health care reform effort for the past year, you have my sympathy. I try to hold back and wait until a law has been enacted to study up on it, to avoid confusion. But it could be that even the lawmakers and those that enforce the laws will be playing catch-up to come to grips with new employee protections.
The Patient Protection and Affordable Care Act of 2010 makes changes to the Fair Labor Standards Act and the Family and Medical Leave Act. These changes apply to employers with 200 or more full-time employees. (Warning, this document is 906 pages long, without the “fixes!”)
First, all new hires must be automatically enrolled in a health insurance plan. This requirement is consistent with the underlying goal of enrolling everyone into a health plan so that health insurance companies are not stuck insuring only the sick. The employees may opt out of the coverage (for example, married couples may have two options for couples or family health insurance). This provision is in section 1511 of the new law.
Second, these larger employers have to provide information to the employees about their coverage options and the availability of health insurance exchanges that may provide a more attractive plan.
Third, Section 1558 prohibits retaliation against employees for obtaining a subsidy or tax credit for their health insurance, or for providing information about violations of this new law The fifth provision is particularly strong: retaliation is prohibited against an individual who
objected to, or refused to participate in, any activity, policy, practice, or assigned task that the employee (or other such person) reasonably believed to be in violation of any provision of this title (or amendment), or any order, rule, regulation, standard, or ban under this title (or amendment).
Fourth, the law specifically incorporates the nondiscrimination provisions of the civil rights laws, barring discrimination on the basis of age, race, gender, religion, national origin, and disability. It provides that no individual shall “be excluded from participation in, be denied the benefits of, or be subjected to discrimination under” health program or activity if it receives federal financial assistance.
Fifth, and most widely reported, the new health care law, in section 4207, requires employers to allow nursing mothers to pump milk at work. If an employer has more than 50 employees, it must provide a private place (not a bathroom) and time (not necessarily paid) for up to a year after the baby’s birth. Smaller employers may claim an exemption if providing this space and time “would impose an undue hardship by causing the employer significant difficulty or expense when considered in relation to the size, financial resources, nature, or structure of the employer’s business.”
Posted by marykeating on April 11, 2010 under Maryland wage law, Pending legislation |
The Maryland legislative session is nearly over for the year. One favorable bill clarifies the state’s wage payment and collection act to include overtime. Both houses have passed the bill, and it’s expected to be signed by Governor O’Malley.
The wage law helps employees enforce their rights to payment for their work. When there is no good faith dispute about the worker’s entitlement to the wages, a judge may triple the amount found to be owed, and award the employee reasonable attorney’s fees for taking the case to court. The policy behind the law is clear. When an employer withholds wages (and many such cases come up when the employer refuses to pay the last paycheck, apparently figuring that the employee will go away quietly), the employee should have an effective means of obtaining the compensation. Permitting additional damages and attorney’s fees are good incentives. In addition, the law penalizes the employer for holding back pay for no reason other than wage theft. On the other hand, if there is an actual dispute over the pay owed, or the amount of a commission, the employee cannot obtain the enhanced damages, but still has access to court.
Now the law will specifically include overtime pay as an element of the compensation that the employee may sue for. Not all courts had accepted the idea that compensation of any kind included overtime pay, so employees would sue under the Maryland law for unpaid straight-time wages or bonuses, and under the federal Fair Labor Standards Act for their overtime pay. This made the cases needlessly complicated. This may not change the reality that federal judges seem more likely to apply the correct burden of proof (it’s on the employer to show exemption from overtime), but it is a good clarifying law.
Posted by marykeating on April 2, 2010 under Family responsibility |
The President’s Council of Economic Advisers recently released a new survey based on Bureau of Labor Standards data. The report examines the availability and effect of employers’ offering their workers flexible schedules. As more families have both parents working, and more people attend college while working, the need for flexible schedules is acute. Further, the report shows that many employers allowed some of their workers to adjust to coming retirement by reducing their hours.
The study found that small businesses are more likely to find flexible schedules, intermittent leave, and telecommuting burdensome. Businesses with fewer than 50 employees do not have to comply with the Family and Medical Leave Act, but this study excluded such small employers, defining “small” as an entity with 50-99 employees. Manufacturing firms are also less likely to offer flexible work arrangements, since the process requires coordinated effort. Finally, other companies such as call centers need constant coverage as the fundamental service provided, making it more difficult to offer flexible times off.
Looked at from the employee point of view, more highly skilled workers are more likely to have flexible arrangements available to them than are employees who make less money or have fewer skills.
Companies that can and do offer flexible arrangements profit by reducing turnover and absenteeism, and increasing employee morale. The report also cites studies showing improved health of employees using flexible work schedules. Productivity is apparently enhanced, although there are disagreements whether the reason is better management, more focused and happy employees, or some other reason or combinations.
