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Recent Employment Law News for May 22, 2013
HR Practice Pointer: What Does the Term “Salaried” Encompass?
Wed, 22 May 2013 17:39:16 - Pacific Time
In a recent decision issued by the California Court of Appeal, 6th District (Negri v.Koning & Assoc.) the court reviewed the criteria for determining whether or not an employee is receiving a “salary” within the meaning of the pertinent wage and hour laws. California law provides that, absent an exemption, an employee must be paid time-and-a-half for work in excess of 40 hours per week. To be exempt from that requirement the employee must perform specified duties in a particular manner and be paid “a monthly salary equivalent to no less than two times the state minimum wage for full-time employment.” The question presented in the Negri case was whether a compensation scheme based solely upon the number of hours worked, with no guaranteed minimum, could be considered a “salary” within the meaning of the pertinent wage and hour laws. The court concluded that “such a payment schedule is not a salary and, therefore, does not qualify the employee as exempt.” Since the trial court in Negri found the employee was exempt, the court reversed that decision because the employee was not paid a guaranteed minimum amount, but instead was compensated based upon the number of hours worked.
In reaching its decision, the court noted that in order for an employee to be exempt from overtime, the employee must perform specified duties and receive the required compensation. Further, as the court observed, California’s Labor Commission noted in an Opinion Letter dated March 1, 2002, that the California Division of Labor Standards Enforcement (DLSE), construes the IWC wage orders to incorporate the federal salary-basis test for purposes of determining whether an employee is exempt or nonexempt. The federal salary-basis test is found in the regulations implementing the Fair Labor Standards Act. Those regulations provide that in order to be exempt from the federal overtime pay requirement, an employee must be engaged in specified job duties for the particular exemption, such as administrative, and be paid on a “salary or fee basis.” An employee is paid on a “salary basis” if the employee “regularly receives each pay period on a weekly, or less frequent basis, a predetermined amount constituting all or part of the employee’s compensation, which amount is not subject to reduction because of variations in the quality or quantity of the work performed. Read More.
Legislation Introduced to Expand Protections for Pregnant Employees
Wed, 22 May 2013 16:23:05 - Pacific Time
Senators Robert Casey (D-PA) and Jeanne Shaheen (D-NH) in the Senate, and Representatives Jerrold Nadler (D-NY), Carolyn Maloney (D-NY), Jackie Speier (D-CA), Susan Davis (D-CA) and Marcia Fudge (D-OH) in the House, joined by the leaders of women’s advocacy organizations, unions, and business groups from across the nation, have introduced legislation – the Pregnant Workers Fairness Act – to ensure that pregnant women are not denied reasonable job modifications that would allow them to continue working. The Pregnant Workers Fairness Act will require employers to make reasonable accommodations for pregnant workers and prohibit employers from requiring pregnant employees to take leave when another reasonable accommodation would allow them to continue working. The bill also bars employers from denying employment opportunities to women based on their need for reasonable accommodations related to pregnancy, childbirth, or related medical conditions. Read More.
.Supreme Court to Decide Scope of Whistleblower Protection Under SOX
Wed, 22 May 2013 16:10:51 - Pacific Time
Section 806 of the Sarbanes-Oxley Act (SOX) prohibits a publicly traded company, a mutual fund, or “any ... contractor [or] subcontractor ... of such company” from discriminating against an employee in the terms and conditions of employment on the basis of certain protected activity. The First Circuit held that under section 1514A such contractors and subcontractors, if working for a privately-held company, may retaliate against their own employees, and are prohibited only from retaliating against employees of the public companies with which they work. The U.S. Supreme Court has agreed to consider the question of whether SOX applies to an employee of a privately-held contractor or subcontractor of a public company (Lawson v. FMR LLC). The petitioners are former employees of privately held companies that operated a group of mutual funds. They alleged that their employers violated SOX by retaliating against them for complaining about allegedly improper business practices. Read More.
.Jury Awards More Than $1.5 Million for Sexual Harassment Claim
Mon, 20 May 2013 16:21:18 - Pacific Time
A jury has rendered a verdict of more than $1.5 million in a lawsuit filed by the U.S. Equal Employment Opportunity Commission's (EEOC) for alleged sexual harassment and retaliation lawsuit against New Breed Logistics, a North Carolina-based logistics services provider. The verdict followed a seven-day trial before U.S. District Court Judge S. Thomas Anderson on behalf of four claimants and included awards of $177,094 in back pay, $486,000 in compensatory damages and $850,000 in punitive damages for the discrimination victims. The EEOC had charged that New Breed Logistics subjected three female employees in Memphis to sexual harassment and then retaliated against the three female employees and one male employee for opposing the harassment in violation of Title VII. Specifically, the jury found that New Breed, through the conduct of a warehouse supervisor, harassed three temporary workers by subjecting them to unwelcome sexual touching and lewd, obscene and vulgar sexual remarks at the company's Avaya Memphis area warehouse facility. The EEOC also charged and the jury found, a New Breed supervisor fired the three temp workers because they complained about the harassment. In addition, the EEOC said, the supervisor also retaliated against a male employee by terminating him because he opposed the harassment and agreed to serve as a witness for several claimants during the company's investigation. Read More.
.Employers Are Liable for Questions Asked by Contract Medical Providers In Violation of GINA
Fri, 17 May 2013 15:30:49 - Pacific Time
As a recent case demonstrates, employers must exercise care to avoid a violation of the Genetic Information Nondiscrimination Act (GINA) by permitting improper questions, such as questions about an employee’s family history, by a contract medical provider during preemployment physicals. The case involves Fabricut, Inc., one of the world's largest distributors of decorative fabrics. The company has agreed to pay $50,000 and furnish other relief to settle a disability and genetic information discrimination lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC). This is the first lawsuit ever filed by the EEOC alleging genetic discrimination. In its lawsuit, the EEOC charged that Tulsa-based Fabricut violated the Americans with Disabilities Act (ADA) when it refused to hire a woman for the position of memo clerk because it regarded her as having carpal tunnel syndrome, and violated GINA when it asked for her family medical history in its post-offer medical examination. David Lopez, General Counsel of the EEOC commented that, "Employers need to be aware that GINA prohibits requesting family medical history…When illegal questions are required as part of the hiring process, the EEOC will be vigilant to ensure that no one be denied a job on a prohibited basis."
According to the EEOC's suit, Rhonda Jones, worked for Fabricut in a temporary position as a memo clerk for 90 days. When her temporary assignment was coming to an end, she applied for a permanent job in that position.
Fabricut made Jones an offer of permanent employment on August 9, 2011, and sent her to its contract medical examiner, Knox Laboratory, for a pre-employment drug test and physical. When Jones reported for her physical,
she was required to fill out a questionnaire and disclose the existence of numerous separately listed disorders in her family medical history. The questionnaire asked about the existence of heart disease, hypertension, cancer,
tuberculosis, diabetes, arthritis and "mental disorders" in her family. Jones was then subjected to medical testing, from which the examiner concluded that further evaluation was needed to determine whether Jones suffered from carpal tunnel syndrome (CTS).
Fabricut told Jones she needed to be evaluated for CTS by her personal physician and to provide the company with the results. Jones's physician gave her a battery of tests and concluded that she did not have CTS. Although Jones provided this information to Fabricut, the company rescinded its job offer because Knox Labs indicated that she did have CTS. Jones made a written request for reconsideration, emphasizing that she does not have CTS, but Fabricut allegedly ignored her request. Such alleged conduct violates GINA, which makes it illegal to discriminate against employees or applicants because of genetic information, which includes family medical history; and also restricts employers from requesting, requiring or purchasing such information. GINA was signed into law in 2008, and took effect the following year. One of the six national priorities identified by the EEOC's Strategic Enforcement Plan is for the agency to address emerging and developing issues in equal employment law, which includes genetic discrimination. Read More.
.Employer to Pay $650,000 to Settle Sexual Harassment Lawsuit
Fri, 17 May 2013 14:59:55 - Pacific Time
National Food Corporation, a major supplier of eggs to the Pacific Northwestern and Midwestern United States and East Asia with headquarters in Everett, Washington, has agreed to pay $650,000 to five workers and provide other relief to settle a sexual harassment lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC). The EEOC's suit charged that a supervisor at National Food's egg farm repeatedly demanded sexual favors from a female laborer, who worked alone in a henhouse, in order to keep her job. The supervisor allegedly would physically grab the barn worker and demand sex from her on a weekly basis, from 2003 to 2010. The EEOC also alleged that when the employee’s co-workers raised complaints about sexual harassment to company management, they were fired or forced out of their jobs. David Lopez, general counsel of the EEOC, commented that "This lawsuit is another in an unfortunate pattern of employers taking advantage of female agricultural workers who often work in isolation and are unaware of their rights…It is one of the EEOC's national priorities to combat discrimination against vulnerable workers, and we hope that this settlement sends a message to other employers that they need to be vigilant to prevent sexual harassment and other abuse." Read More.
.EEOC Issues Revised Publications on Specific Disabilities
Fri, 17 May 2013 14:45:55 - Pacific Time
The U.S. Equal Employment Opportunity Commission (EEOC) has issued four revised documents on protection against disability discrimination, pursuant to the goal of the agency's Strategic Plan to provide up-to-date guidance on the requirements of antidiscrimination laws. The documents address how the Americans with Disabilities Act (ADA) applies to applicants and employees with cancer, diabetes, epilepsy, and intellectual disabilities. These documents are available on the agency's website at "Disability Discrimination, The Question and Answer Series," http://www.eeoc.gov/laws/types/disability.cfm. According to EEOC Chair Jacqueline A. Berrien, "Nearly 34 million Americans have been diagnosed with cancer, diabetes, or epilepsy, and more than 2 million have an intellectual disability…Many of them are looking for jobs or are already in the workplace. While there is a considerable amount of general information available about the ADA, the EEOC often is asked questions about how the ADA applies to these conditions."
In plain language, the revised documents reflect the changes to the definition of disability made by the ADA Amendments Act (ADAAA) that make it easier to conclude that individuals with a wide range of impairments, including cancer, diabetes, epilepsy, and intellectual disabilities, are protected by the ADA. Each of the documents also answers questions about topics such as: when an employer may obtain medical information from applicants and employees; what types of reasonable accommodations individuals with these particular disabilities might need; how an employer should handle safety concerns; and what an employer should do to prevent and correct disability-based harassment. Read More.
.EEOC Files Genetic Information Discrimination Lawsuit Against Rehab Center
Fri, 17 May 2013 14:35:16 - Pacific Time
According to a lawsuit filed by the Equal Employment Opportunity Commission (EEOC) the Founders Pavilion, Inc., a Corning, N.Y., nursing and rehabilitation center, allegedly violated federal law by asking for genetic information during the hiring process. The EEOC also alleged that Founders violated the Americans with Disabilities Act (ADA) and Title VII of the Civil Rights Act. The EEOC has charged that Founders conducted post-offer, pre-employment medical exams of applicants, which were repeated annually if the person was hired. As part of this exam, Founders requested family medical history, a form of prohibited genetic information. Such alleged conduct is in violation of the Genetic Information Nondiscrimination Act (GINA), passed by Congress in 2008 and enforced by the EEOC. GINA prohibits employers from demanding genetic information, including family medical history, and using that information in the hiring process. The EEOC filed suit after first attempting to reach a pre-litigation settlement through its conciliation process. The Founders suit is the second ever GINA lawsuit filed by the EEOC. Read More.
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