Category Archives: Current Affairs

March 23, 2012

Hiring and Social Media: Beware

By Mark Wiletsky

Should you require prospective employees to provide you with access to their Facebook page and other social media accounts, as a condition of being considered for the job? Some public agencies apparently are doing so. But Richard Blumenthal, a Democratic senator from Connecticut, is writing a bill to prohibit the practice. (Not surprisingly, you can find more information about his proposed bill by visiting his Facebook page: http://www.facebook.com/dickblumenthal). Relying on social media for hiring decisions can be risky, but it happens. People Google a candidate’s name, check LinkedIn profiles, browse a Facebook page, or surf the web to see if they can learn some information about the candidate. It’s so easy to do, and there is so much information about people on the web that it is hard to resist. The problem is that the information on the Internet may or may not be relevant to the job. The information also might disclose protected characteristics that you would not otherwise know from simply reviewing a job application (e.g., a person’s race, a disability, etc.). My own thought is that for most private employers, it is not a good idea to require candidates to turn over passwords to their social media accounts. Regardless of whether the candidate agrees to do so, it is clearly not a voluntary decision, and it raises a host of potential problems for private employers, beyond even the typical problem of not hiring someone due to a protected characteristic, e.g., what happens if someone at the company loses the password, abuses it, or protects it but is later accused of being responsible for hacking into the account? The law in this area continues to evolve, but I would avoid becoming a “test case” for having gone too far.

March 5, 2012

Court Upholds NLRB Notice-Posting Requirement, Strikes Down Automatic Sanctions for Failure to Post

By Bradford J. Williams

The U.S. District Court for the District of Columbia issued a highly anticipated ruling last Friday, broadly upholding the National Labor Relations Board’s (NLRB’s) right to issue a rule requiring most private employers to notify employees of their rights under the National Labor Relations Act (NLRA) by posting a notice. The ruling struck down automatic sanctions for failure to post the required notice, but did not altogether eliminate the possibility that failure to post might constitute an unfair labor practice (ULP) under the Act. Absent further Board postponement in light of a likely appeal, or a contrary ruling from a second district court still considering the matter, the notice-posting requirement will go into effect on April 30, 2012.

In August 2011, the NLRB issued a final administrative rule requiring all private employers covered by the Act to post 11-by-17 inch posters “in conspicuous places” advising employees of their rights under the NLRA. Employers who customarily communicate with employees regarding personnel matters using an intranet or internet site were further required to post the notice prominently on that site. As originally written, the rule provided that failure to post would be deemed an ULP under Section 8(a)(1) of the Act. It further permitted the Board to automatically toll (or stay) the six-month statute of limitations for all ULP actions—not just those arising out of a failure to post—where employers had failed to post the required notice.

In late 2011, the NLRB’s final rule was challenged in lawsuits filed in the U.S. District Court for the District of Columbia, and the U.S. District Court for the District of South Carolina. Due in part to this pending litigation, the rule’s original November 14, 2011, effective date was initially postponed to January 31, 2012, and then postponed again to April 30, 2012.

Last Friday, Judge Amy Jackson of the U.S. District Court for the District of Columbia issued her ruling in one of the two lawsuits, National Association of Manufacturers v. NLRB, No.11-1629 (ABJ) (D.D.C. March 2, 2012). The judge rejected the plaintiffs’ contention that the NLRB had exceeded its authority in promulgating the notice-posting requirement. Finding that Congress had not “unambiguously intended to preclude the Board from promulgating a rule that requires employers to post a notice informing employees of their rights under the Act,” she upheld the notice-posting requirement as a valid exercise of the Board’s authority under the deferential standard of review applicable to administrative rulemaking.

Despite upholding the notice-posting requirement, Judge Jackson found that the NLRB had nonetheless exceeded its authority in automatically deeming all failures to post to be ULPs under the Act. Because Section 8(a)(1) only prohibited employers from “interfer[ing]” with rights guaranteed by the Act, it only prohibited employers from “getting in the way – from doing something that impedes or hampers an employee’s exercise of the rights guaranteed by [Section 7] of the statute.” The automatic sanction of an ULP for any employer who failed to post would not distinguish between situations in which an employer’s failure was intended to or did exert influence over employees’ organizational efforts, and those in which an employer merely declined or failed to post the required notice. As such, the judge found that the automatic sanction of an ULP was inconsistent with the Act’s plain meaning.

Critically, Judge Jackson noted that her decision did not “prevent[] the Board from finding that a failure to post constitutes an unfair labor practice in any individual case brought before it.” As such, the Board may still determine that any particular failure to post constitutes an ULP, at least assuming it makes specific findings that the failure actually interfered with an employee’s exercise of his or her rights.

For similar reasons, Judge Jackson struck down the rule’s provision permitting the Board to automatically stay the statute of limitations in any ULP action where the employer had failed to post the required notice. The judge found that the Act provided an unambiguous six-month statute of limitations, and that the rule effectively supplanted this limitations period for a broad class of employers regardless of particular circumstances. Again, she nonetheless observed that, under a well-established common law doctrine, her decision did not “prevent the Board from considering an employer’s failure to post the employee rights notice in evaluating a plaintiff’s equitable tolling defense in an individual case before it.”

Judge Jackson’s March 2nd ruling is broadly disappointing for employers. It upholds the notice-posting requirement that will go into effect on April 30th absent further Board postponement, or a contrary ruling in the second pending lawsuit, Chamber of Commerce v. NLRB, D.S.C., No. 11-cv-2516. It further permits the NLRB to find individual failures to post to be ULPs under the Act, at least given appropriate factual findings. Finally, the judge’s statute of limitations ruling may expose employers to stale ULP charges where employees succeed in showing that they were unaware of their rights under the NLRA due to an employer’s failure to post.

The plaintiffs in National Association of Manufacturers have already vowed to appeal Judge Jackson’s ruling. Pending any eventual reversal by the U.S. Court of Appeals for the District of Columbia, or any contrary ruling by the U.S. District Court for the District of South Carolina, employers should prepare now to comply with the rule’s notice-posting requirement before April 30th. For more information or questions, please contact Bradford J. Williams of Holland & Hart’s Labor & Employment Practice Group at (303) 295-8121 or bjwilliams@hollandhart.com.

February 23, 2012

EEOC’s New Strategic Plan

Wow! The U.S. Equal Employment Opportunity Commission approved a new strategic plan on February 22, 2012.

In summary, the four-year strategic plan, adopted by a 4-1 vote, will focus on efforts to stop and remedy unlawful employment discrimination as a core mission. Commissioner Constance Barker noted that the plan’s focus will emphasize enforcement and litigation rather than education and outreach, which she believed was contrary to the EEOC’s legislative focus.

Perhaps the most dangerous component of the new plan will be the EEOC objective to increase the number of systemic discrimination cases it handles. These cases are focused on pattern or practice, policy, or class cases where the alleged discrimination has a broad impact on an industry. Systemic cases are also exceedingly expensive to defend. The EEOC will work over the next months to create the framework to “inform, justify and support the quantitative and qualitative performance measures throughout the plan.”

Fasten your seatbelts, it's going to be a bumpy night!

You can find the announcement at: http://www.eeoc.gov/eeoc/newsroom/release/2-22-12.cfm

For more information, contact Steven M. Gutierrez.

October 6, 2011

NLRB Postpones Posting Rule

Good news. The NLRB (National Labor Relations Board) has postponed the effective date on the private business posting rule that informs workers about their right to form a union. The Board indicated on Wednesday that there has been too much confusion over which business are covered under the rule. For a good summary of the posting rule from my partner Jeff Johnson click on this link: http://www.hollandhart.com/newsitem.cfm?ID=1873

For more information, feel free to reach out.

Steven M. Gutierrez

September 19, 2011

Employee Misclassification

Secretary of Labor Hilda L. Solis announced at a ceremony on September 19, 2011 that DOL's Wage and Hour Division, IRS, and agency leaders from Connecticut, Maryland, Massachusetts, Minnesota, Missouri, Utah, and Washington signed memoranda of understanding to improve efforts to combat the business practice of misclassifying employees in order to avoid providing employment protections, i.e. paying payroll taxes, workers' compensation expenses, and other benefits.

The memoranda of understanding will enable the federal Labor Department to share information and coordinate law enforcement with the IRS and participating states to level the playing field for law-abiding employers and to ensure that employees receive the protections to which they are entitled under federal and state law. The agreements are intended to send a coordinated message that DOL and the IRS have a new partnership.

See http://www.dol.gov/opa/media/press/whd/WHD20111373.htm

June 6, 2011

Newspaper Loses Arbitration Argument, but Can Hold Employee to His Word

By Jude Biggs

Introduction

Unionized employees file grievances when they believe their employer has not followed the collective bargaining agreement (CBA”); usually such an employee argues the employer did not have “just cause” to discipline, demote, or fire him. If the grievance is not decided in favor of the employee, the employee can take the grievance to arbitration. In most cases, however, union employees need not grieve or arbitrate their statutory discrimination claims; they still have a right outside of the CBA to claim discrimination, just as a non-union employee does, so they can still litigate the claim in court. In 2009, the Supreme Court muddied the waters and said some CBAs may be worded clearly enough that a union employee may only arbitrate a discrimination or retaliation claim through the CBA process. Since then, courts have attempted to sort out just what “clearly enough” means. Courts have also struggled with what to do when an employee says he is disabled when he applies for social security benefits, but then claims he was qualified for a job and should be allowed to sue for discrimination. The following case is the latest word from the Tenth Circuit on both of these issues.

Background

John Mathews, a unionized employee of the Denver Newspaper Agency (the “Agency”), worked for the Agency from 1983 through 2005. At the time his claims arose, he was a Unit Supervisor (but still a union employee). In June 2005, a female employee complained that Mathews had made inappropriate comments; Mathews was placed on paid leave while the complaint was investigated. Once the investigation was completed, the union filed a grievance against Mathews on behalf of the complaining employee, and the Agency demoted him from his Unit Supervisor position on July 1, 2005. That same day, Mathews obtained a doctor’s note saying he could not return to work for medical reasons.

Mathews was originally from southern India. He filed a grievance against the Agency, claiming his demotion was due to his national origin and it violated the union contract’s anti-discrimination provision. He also claimed he was demoted in retaliation for complaints of race, color, and national origin discrimination that he had made in May and June of 2005. He later amended the grievance to remove any reference to a violation of anti-discrimination statutes, but he still claimed he was “discriminated” against when he was demoted. Under the CBA, Mathews could choose to arbitrate his grievance or litigate it in court; in this case, he chose to pursue arbitration. The arbitrator held a 4-day evidentiary hearing on the claims and ruled against Mathews. Mathews then filed a claim for disability benefits with the Social Security Administration (“SSA”), alleging complete and total disability beginning on June 11, 2005 (the date of the alleged comments that led to his demotion).

Mathews filed a lawsuit in district court, claiming he had been discriminated and retaliated against, in violation of Title VII of the Civil Rights Act and §1981 (another civil rights statute that prohibits race discrimination). The district judge ruled Mathews’s decision to arbitrate his claims prevented him from doing so again in court; in other words, he could not have two bites at the apple. In addition, the judge ruled that Mathews’s statement to the SSA that he was totally disabled and unable to work prevented him from claiming he could still do the job he held before. Hence, he was “judicially estopped” or prevented from maintaining a claim for discrimination, as he could not prove he was qualified for the job. Mathews then appealed to the Tenth Circuit.

The Tenth Circuit Says Mathews Gets Two Bites at the Apple

The Tenth Circuit looked first at when a union employee is limited to bringing a statutory discrimination claim under the arbitration procedure in a CBA, and when a union employee may file the discrimination claim under the CBA (if he wishes) and also in court. The Tenth Circuit explained that, based on a 2009 Supreme Court decision (Penn Plaza v. Pyett, 129 S. Ct. 1456 (2009)), a CBA may be worded in such a way as to be the exclusive remedy for claims based on anti-discrimination and anti-retaliation statutes. However, normally, a union employee has both contractual rights under the CBA and statutory rights not to be discriminated or retaliated against. The CBA preempts statutory rights only when the CBA expressly says that statutory claims are to be arbitrated under the CBA. In Mathews’s case, the CBA did say the company and union would not discriminate “in accordance with and as required by applicable state and federal laws.” That language, to the Tenth Circuit, meant only that the company and union agreed discriminatory conduct could violate both the CBA and anti-discrimination statutes; it did not mean submitting a claim of discrimination to arbitration waived the right to sue in court. In addition, Mathews had amended his initial grievance to delete any reference to statutory claims. As a result, the Tenth Circuit held the CBA arbitration process was not Mathews’s exclusive remedy and Mathews could also sue in court.

But the Tenth Circuit Says Mathews Can’t Have It Both Ways

The Tenth Circuit then turned to Mathews’s claim that he could be totally disabled for purposes of getting social security disability benefits but not disabled for purposes of claiming he could still do his job. The Tenth Circuit pointed out that Mathews had to prove he could do the job before he could prove he was discriminated against. Mathews admitted he could not do the job anymore, but blamed the company for his disability. Since the company caused his disability, he argued, it should not escape liability. The Tenth Circuit did not buy his arguments.

In reaching that conclusion, the Tenth Circuit confirmed that, just because an employee claims to be disabled for purposes of gaining social security disability benefits, he is not necessarily estopped (or prevented) from saying he was qualified for a job in a subsequent lawsuit. However, such an employee must explain why he has taken inconsistent positions.

Looking at the medical evidence, the Tenth Circuit saw that Mathews had persuaded the social security judge that he was disabled due to a bulging disc of the cervical spine and an affective disorder as of June 11, 2005. In the discrimination case, he claimed “to the best of his recollection,” his disabling depression occurred after the Agency placed him on administrative leave on June 17, 2005. The two positions were entirely inconsistent, and he made no effort to explain the discrepancy. Mathews’s inconsistent statement to the SSA gave him the benefit of significant disability payments, and allowing him to recover for a lawsuit based on inconsistent statements would give him an unfair advantage. As a result, the Tenth Circuit concluded that the district judge had not abused his discretion by concluding Mathews could not establish a claim of discriminatory demotion.

Retaliatory Demotion Claim Still Survives

The court then reviewed whether Mathews could still sue for retaliatory demotion. Since that claim was not waived in the arbitration process, the court looked at the evidence supporting such a claim, and concluded a jury might rule in Mathews’s favor. The record showed Mathews was placed on leave on June 17, 2005, but he had made complaints to his supervisors on May 31 and sometime after June 17 but before his July 1 demotion. Given that timing, it was possible a jury might conclude the demotion was due to his complaints. As a result, the court remanded the case for further proceedings on the retaliatory demotion claim.

Lessons Learned

The Mathews case teaches union employers in Colorado (and other states within the Tenth Circuit’s reach) that, if they want employees’ statutory discrimination claims to be resolved only through the arbitration process under the CBA, the CBA must say clearly that the arbitrator has the exclusive authority to hear statutory claims. It also helps if the employee says in the grievance that he believes the conduct he is complaining about violates the CBA and anti-discrimination statutes. To avoid the Mathews result, union employers may consider negotiating provisions in their CBAs stating not only that the arbitrator has exclusive authority to hear statutory claims, but also that any general claim of “discrimination” will be deemed both a contract and statutory violation. That may often be impractical, given the dynamics of negotiations, but it may work with some unions.

For more information on this case or arbitration law in general, please contact Jude Biggs at jbiggs@hollandhart.com.

This article is posted with permission from Colorado Employment Law Letter, which is published by M. Lee Smith Publishers LLC. For more information, go to www.hrhero.com.

March 16, 2011

Hiring Mistakes

Over the years, I have heard a familiar theme from clients who face lawsuits filed by former employees. Many have expressed to me that the biggest mistake made was hiring the employee in the first place. While this may be a true expression of a client's feelings, usually there are a lot of mistakes that were made during the tenure of the employee. Nevertheless, I have looked at the hiring process in a number of cases. I believe with greater focus, a business can increase the likelihood of success in hiring by being aware of certain mistakes. Recently, my colleague Joe Neguse and I did a webinar for HospitalityLawyer.com. An article summarizing that presentation, authored by Patrick Mayock from HotelNewsNow.com, can be found by following this link: http://www.hotelnewsnow.com/Articles.aspx/5150/9-hotel-hiring-mistakes-and-how-to-avoid-them

For more information, feel free to reach out to me Steven M. Gutierrez or Joseph D. Neguse