California companies with five or more employees are subject to new legislation that prohibits criminal background screenings prior to a conditional offer of employment. This legislation also prohibits requesting information about criminal history on an application or at a preliminary point in the hiring process. Affected employers should carefully review the law’s requirements as set out in this advisory from attorneys from Troutman Sanders’ Labor & Employment and Financial Services Litigation Sections.
United States executive agencies are practically always on the same page when presenting to the public. So, it is incredibly unusual to see two such agencies taking positions directly contrary to one another in pending litigation. This, however, is exactly the current situation between the U.S. Department of Justice (DOJ), headed by Attorney General Jeff Sessions, and the Equal Employment Opportunity Commission (EEOC), chaired by Victoria Lipnic.
Last week, Mr. Sessions issued a memo setting out the Justice Department’s stance that Title VII does not protect individuals against discrimination on the basis of “gender identity per se, including discrimination against transgender individuals.” The memo states that the DOJ is now taking the position that “sex” (as used in Title VII) only means “biologically male or female.” This is a reversal of its 2014 policy under then-Attorney General Eric Holder that the word “sex” in the statute “extends to claims of discrimination based on an individual’s gender identity, including transgender status.”
Notably, the DOJ’s position now is directly contrary to the EEOC’s position on the matter. The EEOC’s position is that transgender status is protected under Title VII. In fact, the EEOC just filed suit against a tire company in Denver over alleged discrimination against a job applicant on the basis of transgender status. This is consistent with the EEOC’s 2016 Strategic Enforcement Plan, which includes “[p]rotecting lesbians, gay men, bisexuals and transgender (LGBT) people from discrimination based on sex” as a top enforcement priority.
The DOJ has also come out swinging against the EEOC in a pending lawsuit on this very issue. In a case pending in the U.S. Court of Appeals for the Second Circuit, Zarda v. Altitude Express, the plaintiff, a skydiver, claimed that his employer fired him because of his sexual orientation. A three-judge Court of Appeals panel previously ruled that the instructor had no claim for sex discrimination under Title VII. However, the full court (as opposed to a three-judge panel) has agreed to review that decision.
So, the Second Circuit then asked the EEOC to file an amicus (“friend of the Court”) brief in the case. The EEOC argued that sexual orientation discrimination claims “fall squarely within Title VII’s prohibition against discrimination on the basis of sex.” Among other reasons, the EEOC’s brief states that any line drawn “between sexual orientation discrimination and discrimination based on sex stereotypes is unworkable and leads to absurd results.”
Not to be outdone, the DOJ also filed an amicus brief with the Second Circuit in opposition to the EEOC (even though the Second Circuit had not asked for the DOJ’s input). The DOJ argued that this issue has been “settled for decades” and that Title VII does not prohibit sexual orientation discrimination “as a matter of law.” The DOJ went on to state that the question of whether “sexual orientation discrimination should be prohibited by statute, regulations, or employer actions” is one of “policy” and “[a]ny efforts to amend Title VII’s scope should be directed to Congress rather than the courts.” The Court heard oral arguments in the case in late September 2017, with the EEOC and DOJ completely at odds.
This is not the only case where the DOJ has taken a position adverse to the EEOC’s position. In a well-known case involving a Colorado cake shop which refused to make a cake for a gay couple in 2012 known as Masterpiece Cakeshop v. Civil Rights Commission (which is now pending before the U.S. Supreme Court), the Colorado Civil Rights Commission relied on a state statute that prohibits sexual orientation discrimination in public accommodations to order the cake shop to stop discriminating against same-sex couples. The shop owners contend that violates their First Amendment rights to free speech and free exercise of religion.
The DOJ has recently filed an amicus brief in favor of the cake shop owners. The DOJ argues that baking a cake for money is “expressive conduct” and “association” that raises First Amendment concerns, and a state’s interest in protecting gay residents is not strong enough to justify “compelling” this “creative process” for same-sex couples. While not an employment case, this position is clearly contrary to the EEOC’s position on these issues when the workplace is involved.
It seems that the EEOC and the DOJ will remain at odds on these issues in the coming months (and possibly years). It will be interesting to watch how this impacts courts’ analysis in these cases and whether any enforcement efforts or positions will change as a result.
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You may have seen the news that the City of Atlanta recently passed an ordinance decriminalizing the possession of less than one ounce of marijuana. Individuals found in possession of such small amounts of marijuana will now be fined $75 and face no jail time. Earlier this year, Georgia enacted a law expanding the qualifying medical conditions for which cannabis oil may be legally used. Now individuals with certain health conditions (including seizure disorders, Crohn’s disease, Multiple Sclerosis, Parkinson’s, Sickle Cell, cancer, Alzheimer’s, AIDS, Autism, and Tourette’s Syndrome) may possess twenty ounces of cannabis oil with up to a 5% THC level with doctor’s approval. While Georgia (and most of its Southeastern neighbors) remains far from legalizing marijuana for medicinal or recreational purposes, these two recent legal changes reflect a national trend towards marijuana that can create a problem for many employers.
Currently, 28 states and Washington D.C. have legalized marijuana for medical purposes and 8 states (Nevada, Colorado, California, Maine, Massachusetts, Oregon, and Washington) and Washington D.C. have legalized marijuana for recreational use. However, since marijuana remains a Schedule 1 controlled substance under the federal Controlled Substances Act, possession of marijuana is still illegal under federal law, prescription or not.
Courts have begun to address whether an employee’s use of medical marijuana can be a reasonable accommodation under the Americans with Disabilities Act and similar state laws. In 2015, the Colorado Supreme Court held that an employer did not commit disability discrimination when it terminated an employee for violating its drug policy (testing positive for marijuana) despite the employee’s doctor’s prescription for medical marijuana. The Court reasoned that because marijuana was still illegal under federal law, the employer did not discriminate based on disability by enforcing its drug policy. Similarly, the Washington Supreme Court held that an employer’s revocation of a job offer based on the applicant’s positive result for marijuana on a drug test was not wrongful despite the Washington State Medical Use of Marijuana Act. The Supreme Court of California has likewise held that the California Fair Employment and Housing Act does not require an employer to accommodate employees who used medical marijuana by ignoring positive drug test results for the drug that violate employer drug policies.
More recently, however, in July 2017, the Massachusetts Supreme Court held that an employer may have to ignore an employee’s drug test failure due to the use of marijuana to treat a qualified disability because it may be a reasonable accommodation under the state’s anti-disability discrimination law. In Barbuto v. Advantage Sales and Marketing LLC, the employee had Crohn’s disease and a physician provided her with written certification that allowed her to use marijuana for medicinal purposes. The employee did not use marijuana before or at work, but nonetheless tested positive for marijuana on the employer’s mandatory drug test. The Court held that employers in the state had a duty to engage in an interactive process to determine whether there are equally effective medical alternatives that would not violate a drug policy. If no alternative exists, the employer must demonstrate that allowing the employee’s use of medical marijuana (or the positive drug screen for the drug) would cause it an undue hardship, such as transportation employees subject to the DOT, federal contractors and recipients of federal grants, or other employers where allowing positive drug tests for marijuana would be a violation of the employer’s contractual or statutory obligations which would jeopardize the company’s ability to perform its business.
While the laws regarding marijuana (and especially its presence in the workplace through a positive drug test) is jurisdiction dependent there are a few general points for employers to consider. First, to the extent employers work with the federal government or have employees subject to federal regulations, marijuana use of any kind is still off-limits. It is also helpful for all employers to explicitly list marijuana as a drug covered by its drug use policies so that employees and applicants understand expectations. However, until the current conflicts between state (or local) and federal laws are resolved, employers need to keep apprised of news laws and interpretations of existing efforts to permit marijuana use, both medically and recreationally where they may have employees living and working.
Last month, the Trump Administration announced plans to end President Obama’s Deferred Action for Childhood Arrivals (“DACA”) program. This change in policy is sure to have a significant impact on employers.
First, a little background on DACA. Beginning in the 1990s, illegal immigration from Central and South America changed. Illegal immigrants used to consist of predominantly working-age men who crossed the border to go to work, then returned at the end of the day. This changed when more and more families crossed illegally to settle permanently in hopes of finding a better life here in the United States. This change meant that millions of children who grew up here but were brought here illegally were vulnerable to deportation due to a choice their parents made for them. It is very difficult to obtain legal status after coming here illegally. So, these millions of childhood arrivals could potentially be forced to return to a country of which they have no recollection without some sort of protection.
In response, President Obama authorized DACA to provide that protection. Immigrants who came to the U.S. before 2007, who were under 15 years old at the time they came and were younger than 31 in 2012 were permitted to apply for DACA protection. To receive protection from deportation, they had to have a nearly spotless criminal record and either be enrolled in high school or have a high school diploma or equivalent. DACA’s protection lasted two years, but could be renewed. In total, roughly 800,000 out of an estimated 1.3 million immigrants have obtained DACA protection. Part of this protection included authorization to work.
With the ending of DACA, employers will bear some of the cost of abiding by new regulations (or lack thereof). Many of the largest employers in the country have hired the so-called Dreamers – individuals working and living under DACA’s protections. Apple’s CEO, Tim Cook, claims they have 250 employed at the tech giant. It is estimated that 91% of Dreamers are employed. So, with DACA gone, roughly 720,000 employees will become ineligible to remain employed overnight. The cost of replacing these employers is staggering. One think tank estimates it will cost employers $6.3 billion in turnover costs.
Fortunately for employers, the Trump administration announced it will delay ending DACA by six months. It is possible that during that time Congress will enact a law affording the same or similar protections allowing those same individuals to remain and stay employed. Therefore, employers do not need to start terminating their Dreamers right away. However, now is the time to create an action plan so that you are prepared if Congress is unable to reach and enact a solution. Employee turnover is costly and disruptive; abrupt and significant turnover is even more so. Smart employers will be prepared.
For those who missed it while getting an early start to their Labor Day weekend, late last week a federal judge closed the door on regulations that would have significantly changed overtime exemptions after previously leaving that door ajar.
Most employers became very familiar — and concerned — with the proposed regulations over the past two years. The regulations would have increased the minimum salaries required for executive, administrative and professional employees to remain exempt from overtime pay under the Fair Labor Standards Act (FLSA). We wrote about the regulations and their effects in detail here. They were set to become effective December 1, 2016, and would have more than doubled those salary minimums from $455 per week, or $23,660 annually, to $913 a week, or $47,476 annually. The regulations would also have increased the salary threshold for the “highly compensated employee” exemption from $100,000 to $134,000. However, a lawsuit was filed in the Eastern District of Texas and the judge who was assigned the case granted an emergency, nation-wide injunction in November of last year which preliminarily (and temporarily) prohibited the Department of Labor from implementing the new rules.
On Thursday of last week, that same court entered a final judgment against implementing the higher salary thresholds. In doing so, the court found Congress intended that both the salary levels and the duties of executive, administrative and professional employees be considered in determining whether they are exempt from overtime requirements of the FLSA. The court concluded that the high minimum salaries proposed by the regulations placed too much emphasis on only one factor and effectively eliminated consideration of what duties are performed by those employees. The ruling can be found here.
For all practical purposes, the court’s ruling means that the door is now shut on those higher salary thresholds. The Department of Labor has even stated in filings that it no longer seeks to increase the salary minimums to the levels called for by the regulations it fought to implement last year. Rather, the DOL seeks now only to clarify with the courts whether it has any legal authority to increase those minimums at all. When that clarification comes, the DOL may well again implement increases, though not like the ones just struck down.
Employers should keep their eyes open for requests for information and comments from the DOL in anticipation of possible increases to minimum salary thresholds in the near future. Fortunately, those increases will likely be substantially smaller than those which would have been implemented late last year. In addition, many employers, having already prepared their workforces and compensation schemes to allow for the possibility of higher minimum salaries, will likely have less cause for concern with the smaller increases to come.
Earlier this month, a widely-recognized Fortune 50 company reached a $1.7 million agreement with the Equal Employment Opportunity Commission to resolve nearly a decade of litigation over the company’s nation-wide policy of discharging workers who do not return from medical leave after 12 months.
While this settlement still requires approval by a federal judge, the litigation itself (and the size and scope of the settlement, which also includes changes to the company’s policy, notice-posting, record-keeping, reporting, and other requirements) should be instructive for employers dealing with a common issue: what to do with employees who are granted a medical leave but cannot return to duty at the end of a set time period.
One of President Trump’s chief agenda items has been immigration enforcement. While the President’s intent may be to keep out terrorists, remove undocumented foreign nationals, and eliminate fraudulent visa practices, these efforts can also have a tremendous impact on U.S. employers. One of the ways this administration has ramped up its immigration enforcement efforts has been through an increase in I-9 Employment Eligibility Verification Form audits to ensure companies and organizations are engaging in fair, non-discriminatory hiring practices and only hiring individuals who have proper work authorization.
While the Form I-9 requirement originates from Section 274A of the Immigration and Nationality Act, all employers are required by law to complete and retain a Form I-9 for each employee, regardless of the employee’s immigration status in the U.S. So, even a company or organization with only U.S. citizen employees is not necessarily safe from a government-conducted site visit. For instance, the Immigrant and Employee Rights (IER) Section of the Department of Justice exists to investigate 1) citizenship status discrimination in hiring, firing, or recruitment or referral for a fee, 2) national origin discrimination in hiring, firing, or recruitment or referral for a fee, 3) unfair documentary practices during the employment eligibility verification, Form I-9 and E-Verify, and 4) allegations of unlawful retaliation or intimidation. Note that discrimination can be consider action both for or against U.S. workers or workers of a particular national origin, so if the IER receives a complaint about your company’s hiring or employment practices regardless of who it supposedly helps or harms, it can open a case against your company and investigate the allegation(s) made. Even if your company has not engaged in prohibited discriminatory practices, your company could still face severe penalties and fines for documentation/paperwork violations that may be found in such an investigation.
In the event that your company is selected for an audit and you have never inspected your Forms I-9 with an experienced counsel, it is possible that there will be numerous I-9 violations per form. These violations can be either civil or criminal. For example, in a recent I-9 case settlement, a national Chinese fast-food chain was fined $400,000 in civil penalties and was ordered to pay $200,000 in back wages for its unlawful practices. One of its primary violations was carrying on the practice of re-verifying lawful permanent residents when their green cards expired. In another case, a Florida staffing company was ordered to pay a fine of $120,000 for requiring non-U.S. citizens to present specific documents, among other violations. Without proper training in completing the Form I-9, it is not difficult to make sixty-plus violations per form—the average number of I-9 violations a government officer finds on a single I-9 form!
When the government is assessing monetary fines, one of the mitigating factors considered is good faith on the part of the employer. By proactively taking the first step to have an experienced counsel review your company’s Forms I-9 and making adjustments and corrections before the government pays your company a visit, you may be able to significantly reduce the amount of total fines or even avoid any penalties altogether.
By on June 13, 2017
Employers large and small regularly turn over employees. Employees quit to take care of their families, resign to take other jobs, or are fired. Also, many employers, particularly ones whose employees are unionized, will lay off or suspend employees. The reason for the permanent or temporary separation can be crucial in determining the employee’s eligibility for unemployment benefits. While employers do not directly pay unemployment benefit claims, the number of successful claims affects the employer’s unemployment tax liability.
All 50 states, Washington D.C., Puerto Rico, and the U.S. Virgin Islands have some form of state-run unemployment benefits. In every state, if an employee is terminated for cause it affects his or her ability to collect unemployment benefits. In some states, it completely disqualifies the employee; in others it limits his or her benefit award. Also in every state, if the employee voluntarily leaves (i.e., quits) without good cause (for no good reason), then he or she is barred from receiving benefits.
Each state, however defines differently what a disqualifying termination for cause is and what is good cause for quitting. Most states find that terminations resulting from drug or alcohol issues (like showing up intoxicated, or refusing a drug test) are for cause. But Oregon, for example, will grant benefits to an employee who enters a drug or alcohol related rehab program within 10 days after such a discharge. States like Virginia, North Carolina, and Michigan cite absenteeism as a cause for termination affecting an employee’s ability to collect benefits. California and Pennsylvania find employees who are terminated due to a criminal conviction cannot receive benefits, while many others disqualify employees who commit crimes in the workplace (whether those crimes are prosecuted or not). All states have a general disqualifier of termination for misconduct (but again each state defines misconduct differently). Then there are unique disqualifiers, such as in Ohio and West Virginia where resigning to marry or attend to family or personal matters is the equivalent of voluntarily leaving without good cause.
While there are many common threads among the various states, each state’s disqualification standards are different. Employers need to know what reasons for separation hinder or preclude an employee’s claim for benefits. It is important that employers consistently and accurately document all reasons for separation. This includes temporary separations, like suspensions and labor disputes, because some states will pay benefits to temporarily unemployed workers. Many of these states will not pay benefits to employees subject to a disciplinary suspension or out of work due to an on-going strike. One word of caution that cannot be stressed enough, however, is this documentation of the stated reason for separation must be accurate. If an employer creates a pretextual reason for termination, so as to hinder an employee’s ability to obtain unemployment benefits, it could expose itself or undermine its defense to claims of discrimination in that same termination. An employer does not want to win the small victory of denying a former employee unemployment compensation only to find itself significantly hampered in responding to a discrimination lawsuit.
In summary, employers need to know their state’s reasons for disqualification, accurately document reasons for separation, and thoughtfully challenge unfounded unemployment benefit claims. If you need assistance is compiling a list of disqualifying reasons for your state or states, or if you want to discuss whether and how to fight a claim for unemployment (in light of other, perhaps bigger concerns), please do not hesitate to contact us. We will be glad to assist you.
Religious issues in the workplace are challenging both from a legal and practical standpoint. Managers and HR professionals want employees to feel accepted and included, and they don’t want anyone to feel targeted or mistreated based on their religious beliefs or practices. Problems can arise, however, where an employee’s religious practices interfere with the employee’s job or professional interactions. How do you accommodate the employee’s beliefs while also ensuring that the employee meets the job’s requirements? Continue Reading Handling An Employee Who Won’t Shake Hands For Religious Reasons