June 3, 2015 Keith Weddington PARKER POE ADAMS & BERNSTEIN LLP EMPLOYMENT LAW UPDATE.

June 3, 2015

Keith Weddington

PARKER POE ADAMS & BERNSTEIN LLP

EMPLOYMENT LAW UPDATE

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AGENDA

I. Judicial Decisions U.S. Supreme Court 4th Circuit N.C. Appellate Courts

II. Legislative and Regulatory Update

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SUPREME COURT DECISIONS

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NLRB RECESS APPOINTMENTS INVALIDATED

NLRB v. Noel Canning(Decided June 26, 2014)

Obama’s “recess” appointments of NLRB commissions invalidated

Little to no substantive impact New properly appointed

commissioners are making essentially the same substantive decisions

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ACA’S CONTRACEPTIVE MANDATE Burwell v. Hobby Lobby

(Decided June 30, 2014)

Affordable Care Act’s contraceptive mandate violates the religious rights of owners of closely held corporations

Mandate is contrary to Religious Freedom Restoration Act (“RFRA”)

Private corporations can exercise religious beliefs

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ACA’S CONTRACEPTIVE MANDATE Burwell v. Hobby Lobby


Narrow decision – does not apply to publicly-held companies or private companies with dispersed ownership.

RFRA will only supplant other legislation where there is no compelling governmental interest or if the law in question is not the least restrictive means of furthering that interest

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NO OVERTIME PAY FOR SECURITY CHECKS

Integrity Staffing Solutions v. Busk(Decided December 10, 2014)

FLSA does not require employers to pay employees for time spent in security checks

Security check is not the principal activity or an intrinsic element of employees’ jobs

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NO OVERTIME PAY FOR SECURITY CHECKS

Integrity Staffing Solutions v. Busk(Decided December 10, 2014)

Even if submission to security checks are part of your employees’ daily routine, do not list it in a job description

Compensability of preliminary and postliminary activities continue to be a case by case determination

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SHIFTING AGENCY INTERPRETATIONS

Perez v. Mortgage Bankers Association(Decided March 15, 2015)

DOL reversed its position on FLSA exempt status of mortgage brokers

Court distinguished between “legislative or substantive rules” and “interpretive rules”

Legislative/substantive rules require notice and comment

Interpretive rules do not

SHIFTING AGENCY INTERPRETATIONS

Perez v. Mortgage Bankers Association(Decided March 9, 2015)

So what can an employer do to challenge interpretive changes?➤ Agency rule is subject to challenge as arbitrary and capricious➤ Courts are not required to grant agencies unfettered discretion

Mortgage brokers are once again non-exempt

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LIGHT DUTY FOR PREGNANCY-RELATED RESTRICTIONS?

Young v. UPS, Inc.(Decided March 25, 2015)

Pregnancy Discrimination Act (“PDA”): “Women affected by pregnancy, childbirth, or related medical conditions shall be treated the same for all employment-related purposes…as other persons not so affected but similar in their ability or inability to work.”

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PDA does not establish “most favored nation” status for pregnant employees

Court refused to follow EEOC’s recently issued guidelines

Employers must do more than refrain from active discrimination

Light duty/alternative positions not required if employer does not offer these for other employees

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If employee shows that employer accommodated others “similar in their ability or inability to work,” employer must show legitimate, nondiscriminatory reasons for excluding pregnant employees

Expense and inconvenience not a sufficient defense.

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Employers can be liable under PDA if they accommodate a large percentage of non-pregnant employees, but fail to do so for pregnant employees

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Employee can prevail by showing that employer’s policy puts a “significant burden” on female employees and the policy is “not sufficiently strong” to justify that burden

In the end, test measures negative impact on female workers, rather than an intentionally biased policy

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EEOC CONCILIATION SUBJECT TO LIMITED REVIEW

Mach Mining, LLC v. EEOC(Decided April 29, 2015)

Courts have authority to review EEOC conciliation efforts

EEOC must take two steps in conciliation:1. Provide employers with specific information

about its conclusions re: employer’s conduct and effect of such misconduct on employees

2. Try to engage employer in a discussion that would result in employer remedying the alleged discrimination

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EEOC CONCILIATION SUBJECT TO LIMITED REVIEW

Mach Mining, LLC v. EEOC(Decided April 29, 2015)

Reviewing court would evaluate only whether EEOC attempted to confer about a charge, not what happened during the negotiations

Remedy for EEOC’s failure to conciliate is an order that EEOC undertake conciliation process, not dismissal of the lawsuit

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RELIGIOUS DISCRIMINATIONEEOC v. Abercrombie & Fitch


Retailer rejected hijab-wearing applicant because of apparent conflict with its dress code/”Look Policy”

Applicant did not identify headscarf as part of religious beliefs

Employer did not ask, but at least suspected that it was part of applicant’s religious beliefs/practices

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Title VII prohibits employers from refusing to hire applicant in order to avoid accommodating religious belief

Issue: Does prohibition apply only where applicant has informed employer of need for accommodation?

To establish a Title VII violation, applicant need only show that need for accommodation was a motivating factor in employer’s decision

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Employer seeking to avoid an accommodation violates Title VII even if it has no more than an unsubstantiated suspicion that accommodation would be needed

Employer may not make an applicant’s religious practice, confirmed or otherwise, a factor in employment decisions



If need for accommodation is suspected, employer may need to consider engaging in interactive process

Update training regarding hiring practices

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WATCH THIS ONE NEXT TERMGreen v. Donahoe

Issue: When does statute of limitations begin to run on constructive discharge discrimination claims?

At time of discriminatory conduct or at time of resignation?

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FOURTH CIRCUIT DECISIONS

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The The march to the left continues…

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VERBAL CONDUCT ALONE CAN BE ACTIONABLE HARASSMENT

Walker v. Mod-u-Kraf Homes(Decided December 23, 2014)

Verbal conduct can rise to level of actionable harassment, even in the absence of threats or physical conduct

Frequency and severity of the comments are key

Despite several prior 4th Circuit decisions upholding SJ where seemingly more severe conduct was present, court reversed and ordered jury trial

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SOX WHISTLEBLOWER CLAIMSJones v. SouthPeak Interactive

(Decided January 26, 2015)

Federal catch-all 4 year statute of limitations applies to SOX whistleblower retaliation claims (not the 2 year SOL for claims of fraud under securities laws)

Emotional distress damages are recoverable as part of “make whole” relief

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ADA CONTINUES TO EXPANDJacobs v. NC Admin. Office of the Courts

(Decided March 12, 2015)

Question of whether plaintiff has a qualifying disability is subject to only a perfunctory analysis

Social anxiety disorder is ADA disability “Substantially limits a major life

activity” – as compared to most people in the general population

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Reasonable accommodation may require job restructuring

In the post-ADAAA world, employers should focus on reasonable accommodation, not whether a disability exists



Emphasis re: SJ standard – all reasonable inferences must be drawn in favor of the non-moving party – REALLY, REALLY

Piling on reasons for adverse action – after the fact – is proof of pretext

Failure to document is evidence of pretext

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SINGLE INCIDENT CAN SUPPORT TITLE VII CLAIM

Boyer-Liberto v. Fontainbleau Corp.(Decided May 7, 2015)

4th Circuit (en banc) reversed its own precedent

Single workplace incident can be “severe” enough to trigger Title VII claim for hostile work environment, especially where alleged harasser asserts supervisory authority and threatens to get employee fired



Employee is protected by Title VII's anti-retaliation section when complaining about race harassment, even if the offending conduct has not yet risen to the level of a hostile work environment

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Employers must be careful not to be dismissive of employee complaints that supervisor’s comment created hostile/offensive work environment

Supervisor training and strong enforcement of harassment policies are critical

Employers may not get a second chance to avoid liability

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NORTH CAROLINA STATE COURT DECISIONS

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COURT REWRITES NONCOMPETEBeverage Systems of the Carolinas, LLC

v. Associated Beverage Repair, LLC(Decided August 5, 2014)

Court not limited by “blue pencil rule” in sale of business context, where contract expressly gives court ability to rewrite terms

Appeal to N.C. Supreme Court pending If your contract includes a

noncompete, include provision that court can rewrite/modify to make it enforceable

Legislative and RegulatoryActivity

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NLRB

Section 7 of the NLRA:“other concerted activities for the purpose of collective bargaining or other mutual aid or protection.”

Section 8(a)(i) of the NLRA makes it an unfair labor practice for employer to “interfere with, restrain or coerce employees in the exercise of rights guaranteed in Section 7

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NLRB REASSERTS POSITION IN NOEL CANNING

NLRB affirms the position taken in

Noel Canning case Employers’ use of mandatory

arbitration agreements that waive right to arbitrate as a class violate Section 7

But, federal courts have approved such arbitration agreements

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COMPANY POLICIES UNDER SCRUTINY BY NLRB

Increasingly aggressive approach

Key: Policies that could potentially have a chilling effect on discussions by employees of terms and conditions of employment are unlawful

Policy in question is often not even used as the basis for adverse action

Case by case determinations Consequences: rescind policy, remedy

adverse action

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SOCIAL MEDIA AND THE NLRB

Clicking the “Like” button on Facebook in response to another employee’s post about a workplace complaint is protected activity

No distinction between employee who directly complains and one who echoes such opinions.

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SOCIAL MEDIA AND THE NLRB

Employee’s profane Facebook rant not grounds for termination

Employee’s post re: his supervisor included:

-“Bob is such a NASTY M__ F___...”-“F__ his mother and his entire f____ family

NLRB said comment was impulsive; did not interrupt work in any way.

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SOCIAL MEDIA AND THE NLRB(Employers have won a few cases…)

Termination of counselors at a teen center for FB chatter re: intent to engage in insubordination and ignore management instructions was justified

Policy stating expectation of civility re: postings involving coworkers did not restrict content or violate Section 7

But, mind you, the NLRB General Counsel brought these claims in the first place

EMPLOYEE HANDBOOKS AND THE NLRB

Policies challenged by NLRB include: Standard confidentiality provisions

that define confidential information to include financial matters, compensation, personnel matters, etc.

Prohibitions against photography, taping or recording

English only rules Prohibitions re: employees discussing

their rates of pay or disciplinary action

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EMPLOYEE HANDBOOKS AND THE NLRB

Handbooks need to be reviewed with a fresh eye, specifically considering Section 7 issues

Consider using specific examples of prohibited behavior

Include disclaimers emphasizing that policy is not intended to interfere with rights to engage in concerted activity

Location and context of disclaimer matter

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YOUR EMAIL SYSTEM AND THE NLRB

Policy prohibiting use of company email systems for anything other than “business purposes” may be unlawful

Employees given access to email system for business communications are presumptively entitled to use employer’s email for Section 7 activities

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YOUR EMAIL SYSTEM AND THE NLRB

Employer can require that Section 7 activities only take place outside of working time – but, consistent application and enforcement is a must

Very limited exceptions for employers to avoid allowing Section 7 activity on company email systems

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DOL EXPANDS DEFINITION OF “SPOUSE” UNDER FMLA

FMLA rights extended to all legally married spouses, regardless of their state of residence

FMLA now follows the “state of celebration” rule

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PROPOSED EEOC REGS RE: WELLNESS PROGRAM ADA COMPLIANCE

Wellness program participation must be “voluntary”

Employees cannot be denied coverage, terminated or subject to adverse action for not participating

Maximum wellness program incentives or penalties capped at 30% of employer’s total cost of employee-only group medical coverage

Comments due by June 19

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Office Locations• Charleston, SC• Charlotte, NC• Columbia, SC• Raleigh, NC• Spartanburg, SC

Keith Weddington Direct Dial 704-335-9035 [email protected]

mailto:[email protected]

http://www.employmentlawalliance.com/

June 3, 2015 Keith Weddington PARKER POE ADAMS & BERNSTEIN LLP EMPLOYMENT LAW UPDATE.

Documents

security checks security

corporations mandate

supreme court decisions

substantive decisions

pregnant employees court

mortgage bankers association

overtime pay

discretion mortgage