Category Archives: Policies & Employee Handbooks

August 14, 2013

DOL Updating FMLA Guidance to Reflect DOMA Decision

New Labor Secretary, Tom Perez, indicated that the Department of Labor (DOL) has updated departmental guidance regarding spousal leave provisions of the Family and Medical Leave Act (FMLA) to reflect the Supreme Court’s recent decision that struck down certain provisions of the Defense of Marriage Act (DOMA). As the DOL updates its policies, employers too need to examine and update their FMLA policies. Here is what you need to know.

Unconstitutionality of DOMA Means FMLA Spousal Leave Applies to Legally Married Same-Sex Couples

The Supreme Court’s decision in United States v. Windsor focused on Section 3 of DOMA which defined “spouse” as a husband or wife of the opposite sex for purposes of federal laws or regulations. Because of that definition, legally married same-sex couples were not entitled to federal benefits or rights. As a result, FMLA leave benefits did not extend to employees needing time off to care for a same-sex spouse with a serious health condition.

In finding Section 3 of DOMA unconstitutional, the Court stated that the regulation of marriage traditionally rests exclusively with the states and the federal government violates equal protection principles by denying rights and benefits to same-sex couples who are legally married under state law. The result is that federal rights and benefits, including FMLA spousal leave benefits, now apply equally to state-sanctioned same-sex couples and heterosexual couples.

DOL Implementing Court’s Decision

Secretary Perez affirmed the availability of spousal leave under the FMLA based on same-sex marriages. He indicated that the DOL has removed references to DOMA from some of its guidance documents and will continue to take steps to implement the Court’s Windsor decision.

When Do Employers Need to Recognize Same-Sex Marriages for FMLA Purposes?

With some states legally recognizing same-sex marriages and others not, a key question for employers is which state’s law applies for FMLA spousal leave purposes? According to the DOL’s 2009 FMLA regulations, “spouse” means a husband or wife as recognized by the state where the employee resides. This means that the employer must determine if same-sex marriages are lawful in the state where the employee requesting FMLA leave lives, not where the employer is located or where the employee actually works. At present, 13 states plus the District of Columbia recognize same-sex marriages as lawful: California, Connecticut, Delaware, Iowa, Massachusetts, New Hampshire, Maine, Maryland, Minnesota, New York, Rhode Island, Vermont and Washington.

Some groups are urging the DOL to adopt a rule that would recognize FMLA rights based on the state where the marriage was celebrated, not the state of residency. Although the DOL has not yet proposed any rule changes on this issue, we will keep an eye on it and will let you know if any changes to the marriage recognition rules are proposed.

Update Your FMLA Policy for Same-Sex Spousal Leave

If you have employees living in one or more states that recognize same-sex marriages (or in the District of Columbia), update your FMLA policy, forms and practices to incorporate spousal leave benefits for recognized same-sex marriages. This includes FMLA leave for an employee who needs to care for a same-sex spouse with a serious health condition, leave because of a qualifying exigency due to the employee’s same-sex spouse being on “covered active duty” and FMLA military caregiver leave for an employee who needs to care for a same-sex spouse who is a “covered servicemember” or “covered veteran.” Be sure to look at the state where the employee resides when determining whether same-sex marriage is deemed lawful and recognized for FMLA purposes. If you use an FMLA tracking mechanism, make sure the system properly tracks for same-sex spousal leave. As always, train your managers, supervisors and human resource professionals on this change in FMLA benefit coverage.

Disclaimer: This article is designed to provide general information on pertinent legal topics. The statements made are provided for educational purposes only. They do not constitute legal advice and are not intended to create an attorney-client relationship between you and Holland & Hart LLP. If you have specific questions as to the application of the law to your activities, you should seek the advice of your legal counsel.

May 7, 2013

Small Colorado Employers Face Higher Damages for Discrimination Claims

By Mark Wiletsky and Steve Gutierrez

Small businesses beware: your employees now have more incentive to sue you. As of January 1, 2015, employees can recover compensatory and punitive damages for employment discrimination claims against businesses that employ between one to fourteen people under Colorado’s Job Protection and Civil Rights Enforcement Act of 2013, signed into law by Governor John Hickenlooper on Monday, May 6, 2013. But don’t despair. By taking some proactive steps now, businesses can minimize their exposure to potential claims.

Increased Exposure for Small Employers

Colorado’s new anti-discrimination law changes the landscape for small employers by allowing compensatory and punitive damages against Colorado’s small businesses (with 1-14 employees), along with attorneys’ fees and costs to the employee if he or she prevails, back pay, front pay, interest, and other potential relief. Thankfully, the new Colorado law contains some safeguards against outrageous damage awards that would likely put small employers out of business. For businesses with 1-4 employees, compensatory and punitive damages are capped at $10,000. For businesses with 5-15 employees, such damages are capped at $25,000. Businesses with greater than 15 employees are subject to the existing damages caps found in the federal anti-discrimination laws.

The availability of these damages to employees of businesses with fewer than 15 employees will likely result in more discrimination cases filed in Colorado against small businesses, significantly raising the potential exposure for small business owners. That is especially true given that such claims may be filed in state court, which is often viewed by attorneys representing employees as a more favorable forum for such claims.

Age Discrimination No Longer Cut Off at Age 70

The Job Protection and Civil Rights Enforcement Act of 2013 also eliminates the age 70 cutoff for age discrimination claims brought under Colorado law. This brings the state law into line with the federal Age Discrimination in Employment Act which does not have an upper age limit. Consequently, employees age 40 and older are protected from employment discrimination under both state and federal law.

Good Faith Efforts May Avoid Punitive Damages

Under the new Colorado law, employers will not be subject to punitive damages if they can demonstrate good-faith efforts to prevent discriminatory and unfair employment practices in the workplace. In addition, no punitive damages are available in a lawsuit involving a claim of failure to make a reasonable accommodation for a disability if the employer can demonstrate good-faith efforts to identify and make a reasonable accommodation that would provide the disabled employee with an equally effective opportunity and would not cause an undue hardship on the employer’s operation. Small businesses should begin those good-faith efforts now so that policies and procedures to prevent and respond to discrimination are in place when the law goes into effect.

Steps Small Businesses Should Take to Minimize Risk

Unfortunately for small businesses, the mere threat of a lawsuit, however meritless, may stretch tight resources to the breaking point. That is why it is so important to take proactive measures now, which will help minimize the risk of such lawsuits. Among other things, small businesses should:

1) Adopt and distribute policies that prohibit discrimination, harassment, and retaliation in the workplace. Require new and existing employees to acknowledge their receipt of these policies, preferably on an annual basis.

2) Train supervisors, managers and employees. Everyone in the workplace should be trained on your anti-discrimination policies and procedures with specialized training provided to supervisors and managers who must recognize harassment and discrimination and know what to do when they observe it or receive a complaint. In small workplaces, dealing with complaints of discrimination or retaliation can be difficult. Still, if you address it promptly and appropriately, you will be in a better position to avoid or defend against a claim.

3) Document performance issues. We often see meritless lawsuits filed because legitimate performance concerns were not shared with the employee or appropriately documented. If an employee has performance issues, be sure to get it in writing. Focus on the problem, give concrete examples, and warn the employee that a failure to achieve immediate and sustained improvement may result in termination.

4) Arbitration agreements. Consider whether it would be appropriate to have employees sign an arbitration agreement. Such agreements take discrimination claims out of the civil court system, and generally allow for a more streamlined resolution. However, arbitration is not necessarily cheaper than a court proceeding; in fact, in some cases it might cost more. Be sure to consider all the benefits and burdens of arbitration before relying on such agreements. And if you prefer arbitration, make sure your agreement complies with all applicable legal requirements.

Essentially, small employers need the same policies and procedures to deal with discrimination as larger employers do, even though many smaller employers simply do not have the same resources. Take the next 18 months before the law becomes effective to educate yourself, your supervisors and your employees on discrimination issues and take the steps that will help minimize your risk to the damages that will be available soon to aggrieved employees.

March 19, 2013

Checklist for Complying with the New FMLA Regulations

Have you updated your Family and Medical Leave Act (FMLA) policy and poster? You should have. New regulations that implement changes to the FMLA went into effect on March 8, 2013. Covered employers need to take action now to ensure compliance with the new rules.

A summary of the changes to the FMLA as well as a checklist for complying with the new regulations is available here. Be sure to update your FMLA policies, poster, certification forms and notice of rights immediately. In addition, ensure that your leave administrators, supervisors and human resources personnel are trained on the new rules. FMLA compliance isn't hard, but it does take work!

February 12, 2013

FMLA and Facebook Don’t Mix – Vacation Pictures Catch Employee in a Lie

By Mark B. Wiletsky

Co-workers “friend” each other on Facebook all the time. But sometimes those “friends” turn against their own, providing employers with evidence of wrongdoing. In a recent case (Lineberry v. Richards), an employee learned the hard way that posting pictures on Facebook can come back to bite you.

Lineberry, who worked as a full-time Registered Nurse, claimed she needed Family and Medical Leave Act (FMLA) leave after suffering severe pain in her lower back and legs. Her employer granted her request.

About four weeks into her leave, Lineberry took a prepaid, planned vacation to Mexico. As many people do today, Lineberry posted photos of her Mexico trip on her Facebook page. Her co-workers, who had legitimate access to Lineberry’s Facebook page, saw the photos, including pictures of Lineberry riding in a motorboat, lying on her side while holding up two bottles of beer, standing while holding a grandchild on each hip and making trips to Home Depot. Based on the Facebook postings, the co-workers complained to Lineberry’s supervisors. Responding to her supervisor’s inquiry about her activities, Lineberry wrote that she had used a wheelchair at both airports while on her trip.

When Lineberry was released to return to work, her employer called her into an investigative meeting. Initially, she stood by her claim that she had used wheelchairs in the airports on her trip, but after questioning, she admitted that she lied and had never used a wheelchair while on vacation. A week later, Lineberry was terminated for dishonesty and falsifying or omitting information, a violation of the company’s policies. Lineberry sued, claiming that her employer violated her FMLA rights.

Termination Was Based on Dishonesty, Not FMLA

During her deposition, Lineberry admitted again to lying about her use of a wheelchair while on vacation. Because of the undisputed evidence of Lineberry’s dishonesty, the Court ruled that her employer had the right to terminate her without regard to her leave status. The Court explained that the FMLA does not afford an employee greater rights that he or she would have if not on FMLA leave. Because her employer had the right to terminate Lineberry for dishonesty whether or not she took leave, the termination on that basis was permitted by the FMLA.

Employer Lessons

A few key pointers for employers:

1) Although you should always be cautious before disciplining or terminating an employee on protected leave, keep in mind that the employee’s leave status is not a free pass to lie or commit fraud.

2) Of course, before firing or taking disciplinary action against an employee on leave, make sure you have all the facts. If you have a progressive discipline policy, follow all procedures set forth in the policy. The employer in Lineberry waited to make its termination decision until it called Lineberry in for an investigative meeting, as was required under its discipline policy. Failure to follow your own procedures can lead to lawsuits even when your underlying reasons for discipline or termination are justified.

3) Don’t “friend” your employees so that you can surf their Facebook pages – you could be liable for invasion of privacy. In addition, you could learn characteristics that you otherwise would not know (e.g., religion, national origin, disability, etc.) that could later serve as the basis for a discrimination claim. However, if others who legitimately obtained information from Facebook report it to you, treat it like any other workplace complaint and conduct an appropriate investigation.

April 24, 2012

Good Documentation Dooms FMLA Claim

by Mark Wiletsky

A recent case issued by the Tenth Circuit (which covers Colorado) provides a good reminder about the importance of good documentation, and following your employment policies. In Peterson v. Exide Technologies, the Tenth Circuit affirmed summary judgment in favor of Exide Technologies, dismissing Peterson's Family and Medical Leave Act (FMLA) and wrongful discharge claims as a matter of law. Peterson was involved in a forklift accident, in which he was injured. After the accident, he was placed on FMLA leave for 10 days. After investigating the accident, the employer determined that Peterson had violated its safety policies. Therefore, Exide terminated Peterson four days after the accident, while Peterson was on FMLA leave.

Peterson then sued, claiming his discharge violated his rights under the FMLA, and gave rise to a common law claim for wrongful discharge in violation of public policy. The district court and the Tenth Circuit disagreed. Peterson had a history of documented safety violations, and he had no evidence that the stated reason for his discharge–yet another safety violation–was a mere cover-up (or pretext) for an unlawful motive. Importantly, the court rejected Peterson's argument that Exide had failed to follow its own progressive discipline policy. The court noted that Exide's progressive discipline policy was discretionary rather than mandatory, and it did not prevent Exide from considering past disciplinary actions, even if they were dated.

Peterson also claimed the incident giving rise to his termination was minor, and that he was not at fault for the accident. Again, however, the court rejected his arguments, reasoning that Exide could legitimately rely on the final accident given Peterson's record of unsafe work performance. Thus, even though Peterson was terminated while on FMLA leave, his claims were dismissed. There are several important lessons from this case, including:

1. Document performance and behavior issues as they occur.

2. Review your employment policies to ensure they do not create mandatory language with respect to progressive discipline, or any other language that might limit your right to terminate an employee.

3. It is possible to discharge employees while on FMLA leave, but be cautious when doing so. Such a decision has a heightened possibility of leading to litigation. Even if, as in this case, you can successfully defend the case, consider whether there is another approach that might allow you to avoid litigation altogether.

March 29, 2012

Discharge Checklist

By Mark Wiletsky

Here's a great checklist from Nicole Snyder in our Boise office for things to think about before discharging an employee; you can also get to the checklist from this link: http://www.idahoemploymentlawblog.com/2012/03/a-checklist-to-use-before-discharging-an-employee.html. It's a great list of items to consider before you discharge an employee, regardless of whether your employees are in Idaho or another state. As with any checklist, this is not meant to be all-encompassing; you may be in state with special rules, or in an industry subject to regulations that impact a discharge decision. Still, this is a great resource.

March 27, 2012

Furor Over Facebook Continues

By Mark Wiletsky

Following up on my post last week, the flap over employers asking applicants to turn over their passwords to social media accounts, such as Facebook, rages on. Two senators–Sens. Richard Blumenthal (D-Conn.) and Charles Schumer (D-N.Y.)–on March 25 asked the Department of Justice and the EEOC to investigate this practice (http://blumenthal.senate.gov/newsroom/press/release/blumenthal-schumer-employer-demands-for-facebook-and-email-passwords-as-precondition-for-job-interviews-may-be-a-violation-of-federal-law-senators-ask-feds-to-investigate). Facebook joined the fray by warning employers about this practice, and of course the ACLU has raised concerns as well (http://www.cnn.com/2012/03/23/tech/social-media/facebook-employers/index.html?hpt=hp_t3). Is this issue being overblown? Other than media reports about a couple of public entities, it is unclear how many employers are demanding applicants turn over passwords to social media accounts as a condition of employment (or consideration for employment). Still, the heightened media attention is a good reminder for employers to review their hiring practices and their social media policies. If you have not yet read the NLRB's January 25, 2012 Operations Management Memo (http://www.nlrb.gov/news/acting-general-counsel-issues-second-social-media-report), I recommend doing so. Even though I disagree with certain aspects of the Memo, it provides some good examples of things to avoid in both social media policies and discipline/termination situations involving social media–for Union and non-Union work environments.

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.