II. What are Your Responsibilities as an Employer?
The law does not require that you meet the specific demands of the employee, only that you make “reasonable” accommodation when called to do so. We will explore numerous examples from various courts and the EEOC of what constitutes a “reasonable” accommodation under various circumstances. However, the trend is clear that courts will require employers to at least attempt to accommodate objectively reasonable requests that do not endanger coworkers or severely impact business operations. We will also explore some of the unfortunate extremes to which some cases have ventured when requiring accommodation.
The law does not require that you meet the specific demands of the employee, only that you make a “reasonable” accommodation when called to do so. We will explore numerous examples from various courts and the EEOC of what constitutes a “reasonable” accommodation under various circumstances. However, the trend is clear that courts will require employers to at least attempt to accommodate objectively reasonable requests that do not endanger coworkers or severely impact business operations. We will also explore some of the unfortunate extremes to which some cases have ventured when requiring an accommodation.
III. What Are Your Rights as an Employer?
The courts and the EEOC have recognized various legitimate limitations on an employee’s right to demand workplace accommodations. We will explore a few well-recognized legal exceptions to the accommodation requirement including safety concerns and undue hardship to the employer. We will also provide some of the “go-to” defenses when an employee makes objectively unreasonable accommodation requests.
IV. Striking a Balance between Your Rights and Responsibilities in a Politically Correct World
Social and news media often shape the public’s view of the world—and of employers. Often, employers feel the pressure to make accommodations to demanding employees when not legally required to do so. What are the ramifications of making such accommodations? If you give the employee an inch will he take a mile? We will explore the practical and legal effects of both enforcing your rights and the failure to take a consistent stand on certain demands for accommodation.
Authors
Barry Montgomery – Partner, KPM Law
Barry, a partner with KPM LAW, began his career in litigation before he graduated law school by working as an intern at the United States Attorney’s office where he had the opportunity to prosecute federal criminal cases. In his first case, Barry successfully prosecuted a business owner for manufacturing counterfeit currency and bank checks. It was at this point that he decided that he would spend his career in commercial litigation. Barry then began representing insurance companies in fraud and coverage cases as well as personal injury defense.
While Barry still represents insurers and their insureds in commercial litigation, he now focuses his practice on labor and employment law and litigation, as well as professional liability litigation. Barry believes that labor is the force that drives our economy and that an organization’s greatest resource is its employees. Barry believes that management and professional decisions can be vigorously defended in and out of court without compromising an organization’s brand or relationship with its workforce.
Brian A. Cafritz – Partner, KPM Law
Brian has been an invaluable member of the KPM LAW team since 1994, his commitment having helped solidify and expand the foundation of KPM LAW’s regional defense network. Brian primarily focuses his practice on the defense of Fortune 500 companies that operate under large self-insured retentions. With bar licenses in four jurisdictions, he has built a dedicated team and developed an efficient system that allows him to aggressively defend all matters in a regional practice that covers the entire mid-Atlantic region.
As Brian’s practice became more focused on Retail and Restaurant litigation, it became evident to him that the Plaintiff’s bar was more organized in sharing its resources, and so in 2006 – 2007, Brian co-founded the National Retail and Restaurant Defense Association (NRRDA) to promote the education and communication channels of industry leaders and counsel. Brian was elected to serve two terms as the association’s first president. Under Brian’s leadership, NRRDA continued to grow. Today, NRRDA boasts over 600 members and is seen as a leader in the Retail and Restaurant sector.
This article is part of our Conference Materials Library and has a PowerPoint counterpart that can be accessed in the Resource Libary.
HospitalityLawyer.com® provides numerous resources to all sponsors and attendees of The Hospitality Law Conference: Series 2.0 (Houston and Washington D.C.). If you have attended one of our conferences in the last 12 months you can access our Travel Risk Library, Conference Materials Library, ADA Risk Library, Electronic Journal, Rooms Chronicle and more, by creating an account. Our libraries are filled with white papers and presentations by industry leaders, hotel and restaurant experts, and hotel and restaurant lawyers. Click here to create an account or, if you already have an account, click here to login.
]]>Similarly to the United States, Canada has pre-sale franchise disclosure laws in six of the 10 provinces in the country, each of which require that a “franchise disclosure document” or “FDD” be provided to a prospective franchisee at least 14 days before a franchise agreement is signed or any consideration is paid in respect of the franchise. Due to the broad application of franchise laws, certain relationships, including licensed or managed hotel arrangements, may be considered “franchises” under Canadian law, even if not so intended as such or characterised under American law. Consequences for failures or errors of disclosure include statutory misrepresentation and rescission, including the right to sue for losses. Canadian franchise laws are historically strictly construed against franchisors, with case law supporting large damage awards against hotel franchisors because of technical errors in disclosure. While the substance of disclosure is relatively similar in both countries, Canadian disclosure obligations include an overriding “materiality” concept which can require a FDD to be modified on a deal-by-deal basis to account for deal-specific facts, including, in some instances, the content of a PIP, as well as an ongoing disclosure obligations in respect of “material changes” between the provision of the FDD and the execution of a franchise agreement. Certain exemptions exist from the obligation to make disclosure, including in Ontario and British Columbia, where the acquisition of the franchise exceeds $5M.
NO “AT-WILL” EMPLOYMENT IN CANADA
There is no “at-will” employment in Canada. No Canadian employer has the ability to terminate a Canadian employee’s employment at any time without cause and without notice, except within the first three months of an employee’s employment (provided the employer has reserved that right, in writing, when it offers employment to be able to exercise it).
Employers have an implied duty of good faith and fair dealing with their employees. Consistent with this is the implied obligation to provide an employee with “reasonable notice” of termination of employment where there exists no “cause”. This entitlement can trigger substantial severance payments and is one of the key reasons that Canadian employers typically enter into formal written employment agreements with their employees.
While employers are permitted to terminate employees’ employment without notice for cause, cause has a very high threshold under a Canadian law. Under employment standards legislation in every Canadian jurisdiction, written notice of termination or pay in lieu of notice is required for the termination without cause of any employee with three months’ service or more. The statutory requirements vary across the country, but generally equal roughly a week of notice or pay in lieu for each year of service to a maximum of eight weeks.
Employment standards legislation cannot be contracted out of; attempts to do so are deemed void. The Supreme Court of Canada has set aside an employment agreement where the employee agreed no notice of termination was required. In that case, the Court required the employer to pay an amount consistent with the common law obligation to provide reasonable notice (which is typically much greater than the minimum imposed by employment standards legislation).
The common law obligation to provide reasonable notice is based on a number of factors such as age, length of service, position performed, and prospects for securing alternate, comparable employment. While there is no “rule of thumb”, awards of one month per year of service, and more, are commonplace in Canada.
Reasonable notice generally includes not just pay, but benefits, commissions, most incentives or bonus, pension, deferred payments, car allowances, continued stock option vesting, etc. The employer is required to keep the employee “whole” for the period of reasonable notice and, if paying in lieu, is required to maintain all of the compensation and benefits associated with the employment relationship, unless there is very careful drafting in the applicable plan to prevent this.
CANNABIS LAW
As of October 17, 2018, it has been legal to cultivate, posses, acquire and consume cannabis and cannabis products across Canada. Permitted products include cannabis and cannabis accessories, but excluded, until October 17, 2019, “edibles” and other cannabis-infused products, such beverages and vaporizers. The legal framework which regulates cannabis consists of federal, provincial and municipal laws and regulations. Federal legislation focuses on public health and safety, with jurisdiction over such things as production licensing, packaging, labelling and promotion and taxation. Provincial legislation focuses on distribution, retail, as well as setting rules regarding where individuals may smoke cannabis. The decentralization of jurisdiction to the provinces has created a lack of uniformity across the country. For instance, consumption in public areas is prohibited in some provinces, while others, like Ontario, permit consumption anywhere tobacco smoking is permitted, with certain exemptions (such as vehicles or where children frequent). Certain provinces, like Alberta, have created rules to permit (at a later date) the regulation of consumption spaces (such as lounges or cafes), while others have not. In Ontario, British Columbia, and other provinces, cannabis can be smoked in designated guest rooms in hotels, motels and inns. Local or municipal governments may impose further restrictions which could limit provincial rules.
DESTINATION MARKETING FEE LITIGATION – KNUTH V. BEST WESTERN ET AL…
In Canada, destination marketing programs have been established by local tourism authorities, hotel associations or other bodies, for the purpose of promoting tourism in a particular city or region. These programs raise money for their promotional activities by soliciting hotels and other tourist service providers to remit a percentage or fixed amount of their revenues to the marketing program. These contributions may be funded by the hotels in whatever manner they see fit, but usually take the form of a percentage surcharge on the quoted room rate; surcharges, referred to as Destination Marketing Fees (“DMF”), are collected voluntarily by the hotels, and have no statutory basis.
DMFs are distinguished from lodging or accommodation taxes which are also levied in some provinces over and above applicable sales taxes. These are collected and remitted to provincial authorities. Generally, municipalities in Canada lack the authority to levy local taxes on hotel rooms.
In Canada, a consumer must be provided with clear, unambiguous notice of the DMF prior to the consumer entering into the agreement, particularly as the consumer will use the pricing information to determine if he or she will enter into the agreement. The DMF must be disclosed as a separate item/charge and must not be combined with applicable taxes or any other amounts payable by the consumer.
In the ongoing case of Knuth v. Best Western et al, the plaintiff made claims based on, among other things, the following:
In many instances the website/software platforms being used by certain hotels could not easily set out the DMF on a separate line at the point of booking. In some instances, it is claimed that the DMF was included with the tax giving the appearance of taxes being charged in excess of the applicable rate. Further many systems could not charge the correct tax on the full room rate such that the tax was on top of the DMF.
By way of update, certain of the franchisors in the action brought a motion for summary judgement to have the action dismissed against them on the basis that they are not liable for the actions of their franchisees. In August 2019, the Court dismissed the summary judgement motion. It is expected that the next major step will be certification as a class action.
LOYALTY PROGRAM LAW UPDATE
There are recently-enacted laws in Ontario (January 2018) and Quebec (August 2019) regulating loyalty programs. Subject to prescribed exceptions, the new laws prohibit the expiry of reward points due to the passage of time alone.
The key exceptions include:
It is anticipated that other Canadian jurisdictions will adopt similar loyalty specific legislation in the coming years.
CANADA’S ANTI-SPAM LEGISLATION (“CASL”)
In Canada, there are disclosure and consent requirements for the sending of a commercial electronic message (“CEM”). The sender must obtain explicit opt-in consent unless implied consent or an exception applies. This differs from the US “opt-out” model. The key exception is where there is an existing business relationship within a 2-year period immediately preceding sending of the CEM.
There are requirements for every CEM delivered, including:
MERGERS & ACQUISITIONS
Acquisitions of US hotels are almost always completed as asset deals unless there is a specific reason that an entity deal must be utilized. While asset deals are common in Canada, entity deals are sometimes utilized to take advantage of the lifetimes capital gains exemption. The exemption allows a Canadian individual who holds shares of a qualified small business corporation to a lifetime capital gains exemption equal to approximately CAD $850,000. There are a number of requirements in order to take advantage of this exemption including that the shares were held for a minimum of 2 years, the corporation was a Canadian-controlled private corporation, and that the corporation had during such time “active” business income. Further, land transfer tax is not payable in connection with a transfer of shares of a corporation but is payable on a transfer of assets which is further incentive to structure as a share deal.
AUTHORS
Jason Arbuck
Partner and Co-chair, Hospitality Group Cassels Brock & Blackwell LLP
jarbuck@casselsbrock.com
Frank Robinson
Partner and Co-chair, Hospitality Group Cassels Brock & Blackwell LLP
frobinson@casselsbrock.com
This article is part of our Conference Materials Library and has a PowerPoint counterpart that can be accessed in the Resource Libary.
HospitalityLawyer.com® provides numerous resources to all sponsors and attendees of The Hospitality Law Conference: Series 2.0 (Houston and Washington D.C.). If you have attended one of our conferences in the last 12 months you can access our Travel Risk Library, Conference Materials Library, ADA Risk Library, Electronic Journal, Rooms Chronicle and more, by creating an account. Our libraries are filled with white papers and presentations by industry leaders, hotel and restaurant experts, and hotel and restaurant lawyers. Click here to create an account or, if you already have an account, click here to login.
]]>A former server filed an action under the California Labor Code Private Attorneys General Act of 2004 (PAGA), seeking civil penalties on behalf of herself and other “aggrieved employees” for California Labor Code violations, including the failure to reimburse the cost of slip-resistant shoes. Plaintiff alleged a violation of Labor Code section 2802, which requires an employer to reimburse employees for all necessary expenditures incurred by the employee in direct consequence of the discharge of their duties.
Plaintiff argued that, because the restaurant required employees to wear slip-resistant, black, closed-toes shoes for safety reasons, such shoes should be provided free of cost or employees should be reimbursed for their cost.
The Court of Appeal, persuaded by the reasoning in an unpublished Ninth Circuit Court of Appeals decision, Lemus v. Denny’s, Inc., and guidance from the California’s Division of Labor Standards Enforcement (DLSE), held that section 2802 did not require the restaurant employer to reimburse its employees for the cost of slip-resistant shoes. Specifically, the Court held that the cost of shoes does not qualify as a “necessary expenditure” under section 2802.
In reaching its decision, the Court followed the reasoning in Lemus, citing a DLSE opinion letter, “The definition and [DLSE] enforcement policy is sufficiently flexible to allow the employer to specify basic wardrobe items which are usual and generally usable in the occupation, such as white shirts, dark pants and black shoes and belts, all of unspecified design, without requiring the employer to furnish such items. If a required black or white uniform or accessory does not meet the test of being generally usable in the occupation the [employee] may not be required to pay for it.”
Here, the plaintiff did not argue that the slip-resistant shoes were part of a “uniform” or were not usual and generally usable in the restaurant occupation. The restaurant did not require employees to purchase a specific brand, style, or design of shoes and did not prohibit employees from wearing their shoes outside of work.
Under California law, a restaurant employer must pay for its employees’ work clothing if the clothing is a “uniform” or if the clothing qualifies as certain protective apparel regulated by OSHA or California’s Division of Occupational Safety and Health (Cal/OSHA). Labor Code and Industrial Welfare Commission Wage Order No. 5-2001, governs the public housekeeping industry, including restaurants. Under Wage Order No. 5, uniforms must be provided and maintained by the employer when the uniforms are required by the employer to be worn by the employee as a condition of employment. “Uniform” includes “wearing apparel and accessories of distinctive design or color.” This section of the wage order specifically does not apply to protective equipment and safety devices regulated by the Occupational Safety and Health Standards Board.
On appeal, the plaintiff abandoned her alternative theory of liability that reimbursement was owed under provisions of Cal/OSHA, Labor Code sections 6401 and 6403, which require employers to furnish and provide safety equipment to employees.
The trial court had held that OSHA and Cal/OSHA provide than an employer is not required to reimburse employees for the cost of non-specialty shoes that offer slip-resistant characteristics, but are otherwise ordinary clothing in nature. However, the Court of Appeal ultimately did not decide the applicability of OSHA or Cal/OSHA. Likewise, the Ninth Circuit in Lemus v. Denny’s, Inc. did not address whether Cal/OSHA requires reimbursement of slip-resistant footwear.
After the decision in Townley, there remains a question of whether reimbursement for the cost of slip-resistant shoes could be required under Cal/OSHA for safety reasons. Under Federal OSHA regulations, employers must generally provide personal protective equipment at no cost to the employee. The regulation specifically includes an exemption for non-specialty safety-toe protective footwear, which the employer permits to be worn off the job-site. Employers are also not required to pay for everyday clothing, including street shoes and normal work boots. Under California law, if protective equipment is required by Cal/OSHA, the employer is responsible for paying for the safety equipment. There is no Cal/OSHA regulation equivalent to the Federal exemption for generic non-specialty shoes. While California employers have argued (and the trial court in Townley concluded) that the Federal exemption should control in California, the California Court of Appeal and Ninth Circuit have so far left that question unanswered.
Takeaways
Although we now have clarity that California Labor Code section 2802 does not require reimbursement of the cost of slip-resistant footwear, there remains the question of whether such footwear could constitute reimbursable protective equipment under Cal/OSHA safety standards. Although Townley and the Federal OSHA exemption provide some guidance for California employers, they are reminded that neither are necessarily binding or precedential. As such, it will be important for employers to track California caselaw in this area, as well as look out for Cal/OSHA guidance. In the meantime, employers are encouraged to periodically review their policies and practices for reimbursing employee business expenses to ensure compliance with California law, including Cal/OSHA regulations.
]]>ADA/Standing
1. Brito v. Wyndham Hotels and Resorts, LLC, 2018 WL 317464 (D. Colo., 01/08/2018). Plaintiff is a paraplegic and requires the use of a wheelchair to ambulate. While at defendant hotel he encountered multiple violations of the Americans with Disabilities Act (ADA) that effected his use and enjoyment of the premises and sued. The hotel challenged plaintiff’s standing. To establish standing, a plaintiff must show, inter alia, that he suffered an injury in fact. To prove that, plaintiff must establish a likelihood that he will return to defendant’s premises. Factors a court considers are the proximity of the business to plaintiff’s residence, the plaintiff’s past patronage of the business, the definitiveness of plaintiff’s plan to return, and the plaintiff’s frequency of travel near defendant. In the complaint plaintiff stated he lives in the same county as defendant, he has frequented defendant hotel for “pleasure purposes,” he was a guest at the premises for a two day stay, and he alleges an intention to return within four months. This constitutes a personal stake in the outcome to constitute standing and avoid dismissal of the complaint.
Bankruptcy
2. In Re Lorraine Hotel 2017 LLC, 2018 WL 5288893 (N.D. Ohio, 10/22/2018). Plaintiff hotel filed a Chapter 11 petition in bankruptcy. The debtor’s sole asset was a 93-room hotel, of which 54 rooms were rentable. The debtor did not have casualty insurance covering destruction of, or damage to, the facility. The Bankruptcy Code, Section 1112(b) authorizes a judge to dismiss or convert a Chapter 11 case to Chapter 7 “for cause.” Cause exists where a debtor fails to maintain appropriate insurance resulting in risk to the estate. The court stated appropriate insurance coverage is of “paramount importance” in this case because of the single asset in the estate and the status of the business as a struggling downtown hotel. The court thus dismissed the Chapter 11 case and denied conversion to Chapter 7. Instead, creditors can pursue their state remedies.
Class Action
3. Valverde v. Xclusive Staffing, Inc., et al, 2018 WL 4178532 (D. Co., 08/31/2018). Plaintiff is an employee of Omni Hotel. Per the written employment policies of the management company that operates the hotel, a $3.00 processing fee is deducted from each paycheck plaintiff and other employees receive. Plaintiff objected and seeks certification of a nationwide class of plaintiffs. Defendant objected arguing the allegations were insufficient to show that plaintiffs from other states were subject to the same policy. The court noted that defendant management company’s policies are national and controlled centrally from its Colorado headquarters. They are contained in its written employment policies used nationwide. The court thus found the evidence sufficient to certify a nationwide class.
Contracts
4. Murphy Elevator Co., Inc., v. Coco Key Hotel & Water Resort, 2018 WL 1747924 (Ohio Appls Crt, 04/11/2018). The parties had a two-year elevator maintenance contract. After the first year and a half, the hotel failed to pay. The elevator company stopped performing and sued for breach of contract. The hotel argued that it should only be liable for the unpaid moneys up to the time plaintiff stopped performing. The court rejected this argument and granted the elevator company lost profits. Noted the court, an award of damages should put the injured party in the same position it would have been in had there been no breach.
5. Stanciel v. Ramada Lansing Hotel and Conference Center, 2018 WL 842907 (Mich. Appls, 02/13/2018). Plaintiff fell when entering a hot tub at defendant hotel. Plaintiff attributes the fall to a broken support bar leading into the tub. Plaintiff sued, and the parties purportedly agreed to a settlement. Defendant prepared a written settlement agreement and submitted it to plaintiff. The documents included a “Medicare addendum.” Defendant’s attorney told plaintiff’s counsel to advise if he had a problem with any of the wording. Plaintiff returned the signed documents to defendant but unilaterally crossed out language in the addendum. Plaintiff now seeks to enforce the settlement agreement. Defendant argued the agreement was not valid because defendant was not willing to agree to the settlement without the eliminated clause. Plaintiff argued the clause that was crossed out was not an essential term of the settlement agreement so there was still a meeting of the minds on all the essential terms. The court ruled the parties did not reach an enforceable settlement agreement. Case dismissed.
6. Claris, Ltd. v. Hotel Development Services, LLC, 2018 WL 3203053 (Crt. Appls, Ohio, 06/29/18). Per contract dated 8/2005, defendant agreed to build plaintiff a 4-floor, 122 room hotel which plaintiff planned to operate as a Candlewood Suites. The construction was completed in late summer 2006. In 2013 the hotel began experiencing water penetration when rain occurred. Plaintiff’s expert witness investigated defendant’s construction work of the hotel’s walls and identified five deficiencies. The expert excluded one of the five as the cause of the water problem but did not identify the extent to which the other four may have contributed to the damage. Therefore, plaintiff failed to establish that a breach of contract by defendant caused the leakage. Thus, the court reversed a jury verdict in favor of plaintiff and directed a verdict for defendant.
7. Couture Hotel Corporate v. US, 2018 WL 3076847 (Crt. of Fed. Clms, 06/21/2018). Plaintiff purchased a $9 million hotel near Nellis Air Force Base intending to participate in the off-base lodging business for visitors to the base utilized when on-base lodging is full. To meet the base’s requirements, plaintiff made modifications costing in excess of $1 million. When the work was completed, defendant advised plaintiff that, due to lowered demand, it was not adding any new facilities to its overflow listings at the time. Plaintiff sued, claiming that defendant’s refusal to permit plaintiff to compete for off-base services violated the Competition in Contracting Act, various associated procurement regulations, and a contract implied-in-fact. The court held for the government finding procurement rules were not violated, and a contract-in-fact did not exist. While the government representative talked to plaintiff about prerequisites to qualify for the lodging overflow business before plaintiff purchased the facility, documents provided to plaintiff clearly stated that a prerequisite to the government signing a contract were various inspections and approvals. Said the court, “[I]n negotiations where the parties contemplate that their contractual relationship would arise by means of a written agreement, no contract can be implied.” The complaint was thus dismissed for failure to state a claim.
Default Judgment
8. Travelodge Hotels, Inc. v. Durga, LLC, 2018 WL 5307809 (D. NJ, 10/26/2018). Defendant was a franchisee of plaintiff. Defendant ceased operating and plaintiff filed suit for damages for breach of contract. Plaintiff ultimately received a default judgment. Defendant now seeks relief from that judgment. He argued his failure to defend was excusable because he was traveling the world searching for experimental medical treatments for their daughter who suffers from a rare anoxic brain injury which worsened about the time of the lawsuit. Per defendant, this search “consumed” his life. The court granted the relief, noting that the defendant’s inattention to the lawsuit was excusable given the daughter’s illness.
Eminent Domain
9. North Carolina Dept. of Transportation v. Laxmi Hotels, Inc., 2018 WL 2207793 (05/15/2018). Defendant operates a Super 8 Motel. The Department of Transportation (DOT) sought to widen and improve the street on which the hotel was located. As a result of the work, the hotel lost several parking spaces. Also, due to a 15-foot tall retaining wall installed, visibility of the facility from the nearby thoroughfares was totally lost. The DOT claims it explained the extent of the work to be performed. The hotel’s president stated the DOT assured him the hotel would not lose any parking spaces and failed to explain the height of the retaining wall. As a result of the lost parking and street visibility, the hotel claims the DOT significantly underpaid for the taking since the loss of parking and visibility severely impacted the value of the hotel. The court agreed that the DOT did not adequately inform the hotel of the extent of the taking of hotel property. The court thus ordered the DOT to provide just compensation. The case was remanded for further calculation of appropriate reimbursement for the hotel.
Employment/Actual Employer
10. Frey v. Hotel Coleman, et al, 2018 WL 4327310 (7th Cir., 2018). Plaintiff worked at a Holiday Inn Express in Algonquin, Illinois. The hotel was owned by Hotel Coleman, Inc. which hired Vaughn Hospitality, Inc. to manage the facility. Vaughn Hospitality consisted of Michael Vaughn and his wife. Plaintiff’s paychecks came from Hotel Coleman; she was trained, supervised, evaluated, assigned, etc. by Vaughn Hospitality. Plaintiff claimed Michael Vaughn sexually harassed her and she filed a claim with the EEOC. She was thereafter fired and sued Hotel Coleman and Vaughn Hospitality for retaliatory discharge. The lower court determined Vaughn Hospitality was not plaintiff’s employer and dismissed the charges against it. Following trial against Hotel Coleman, plaintiff appealed Vaughn Hospitality’s dismissal. The appeals court reviewed several factors to consider when determining who is an employer, the most important being the right to control and supervise the worker. The court vacated the ruling that Vaughn Hospitality was not a joint employer and remanded the case. In doing so the court commented that the district court will “likely” conclude that Vaughn Hospitality was plaintiff’s employer.
Interested in more? Click here to continue reading.
This article is part of our Conference Materials Library and has a PowerPoint counterpart that can be accessed in the Resource Libary.
HospitalityLawyer.com® provides numerous resources to all sponsors and attendees of The Hospitality Law Conference: Series 2.0 (Houston and Washington D.C.). If you have attended one of our conferences in the last 12 months you can access our Travel Risk Library, Conference Materials Library, ADA Risk Library, Electronic Journal, Rooms Chronicle and more, by creating an account. Our libraries are filled with white papers and presentations by industry leaders, hotel and restaurant experts, and hotel and restaurant lawyers. Click here to create an account or, if you already have an account, click here to login.
Authors
KAREN MORRIS
(585) 256-0160
Judgekaren@aol.com
Karen Morris is an elected Town Justice in Brighton New York, a Professor of Law at Monroe Community College (MCC), and an author. She was elevated to the title of Distinguished Professor, awarded by the Chancellor of the State University of New York.
She has written several textbooks including numerous editions of Hotel, Restaurant and Travel Law, the latest of which was published in 2017 by Kendall Hunt and won a Textbook Excellence Award from Text and Academic Authors Association. She also wrote two editions of New York Cases in Business Law for Cengage Publishing. In 2011, she published Law Made Fun through Harry Potter’s Adventures, and in 2017, Law Made Fun through Downton Abbey. She also co-authors Criminal Law in New York, a treatise for lawyers. She writes a column for Hotel Management Magazine entitled, Legally Speaking, and a blog for Cengage Publishing Company on the law underpinning the news.
Among the courses she has taught are Hotel and Restaurant Law, Business Law I and II, Constitutional Law, Movies and the Law, “The Michael Jackson Trial” and “O.J. Simpson 101; Understanding Our Criminal Justice System.” Her course offerings include some in traditional classroom settings and others online. She won the Excellence in Teaching Award in 1994, having been selected by her peers, and the Chancellor’s Award for Teaching Excellence in 2002, conferred by the Chancellor of the State University of New York.
DIANA S. BARBER
(404) 822-0736
dsbarber@gsu.edu
Diana@LodgeLawConsulting.com
Diana S. Barber, J.D., CHE, CWP is currently an adjunct professor teaching hospitality law and hospitality human resource management at Georgia State University in Atlanta, GA. In addition, she conducts a one-day workshop on contracting and risk management for the Events and Meeting Planning Certificate Program offered by The University of Georgia in Athens, Georgia.
In 2017, Diana became a co-author of Hospitality Law, Managing Legal Issues in the Hospitality Industry (5th Edition), along with Stephen Barth.
Ms. Barber is a recipient of the J. Mack Robinson College of Business Teaching Excellence Award in 2011 and was awarded 2011 Study Abroad Program Director of the Year by Georgia State University. In addition, Ms. Barber is the recipient of the 2010 Hospitality Faculty of the Year award and in 2012, received a Certificate of Recognition from the Career Management Center for the J. Mack Robinson College of Business. Ms. Barber is a member of Phi Beta Delta, an honor society for international scholars. Diana also completed her certification as a Certified Wedding Planner through the nationally recognized [the] Bridal Society.
Ms. Barber has recently launched a consulting/speaking company called LodgeLaw Consulting using her combined academic and hospitality legal skills; specializing in providing education to hospitality companies on preventative measures to reduce legal exposure, as well as a full range of legal services to hotels, motels, restaurants, event planning companies and private clubs. She has over thirty years of legal hospitality experience. Diana began her law practice as an associate attorney at King & Spalding in Atlanta, Georgia after graduating cum laude from Walter F. George School of Law at Mercer University in Macon, Georgia. She then spent over fourteen years with The Ritz-Carlton Hotel Company, LLC serving as vice president and associate general counsel. She is a member of the State Bar of Georgia, G.A.H.A., and the Georgia Hotel & Lodging Association (“GHLA”).
]]>requirements on employers, in hopes of giving #MeToo a significant, lasting effect. So, what should employers in New York and California do now? And, given that these states are often at the forefront of labor and employment issues, how should employers outside New York and California prepare in case new laws are passed in their states?
New York’s New Anti-Sexual Harassment Laws
On April 12, 2018, New York Governor Andrew Cuomo signed into law the 2019 New York State Budget, updating the state’s sexual harassment laws. Among other changes, there are two key components under these laws. First, every employer in New York must establish a sexual harassment prevention policy. These policies should have already been adopted and provided to all employees by October 9, 2018. The New York Department of Labor and New York Division of Human Rights have established a model sexual harassment prevention policy for employers to adopt. But employers are not required to use this model, so long as their policy meets or exceeds the minimum standards of the model and set forth in the laws. Employers must distribute the policy to all employees in writing or electronically, and must ensure that all future employees receive the policy before they start work. Additionally, employers are encouraged to post a copy where employees can easily access it.
Second, every employer in New York is required to provide employees with sexual harassment prevention training. Again, the New York Department of Labor and New York Division of Human Rights have developed model training for employers to use. Though employers are not required to use the model, they must ensure that their training program meets or exceeds the minimum standards of the model, and includes the specific minimum requirements set forth in the laws. All employers are required to train current employees by October 9, 2019, and new employees should be trained as quickly as possible upon hire. In addition, all employees must complete the training at least once per year. There is no certification requirement for trainers, and employers may use third-party vendors to deliver the training.
Importantly, employers in New York should also be mindful of the mandatory arbitration and nondisclosure agreement prohibitions that went into effect this summer, on July 11, 2018. Under New York’s new anti-sexual harassment laws, a contract cannot contain any clause that requires mandatory arbitration to resolve sexual harassment claims. Unless one of the limited exceptions applies, such clauses will become null and void. Furthermore, with respect to nondisclosure agreements, the new laws have established a three-step process for memorializing the complainant’s preference for entering such an agreement. Under the new laws, a nondisclosure agreement is defined to include any resolution of any claim involving sexual harassment that would prevent the person who complained from disclosing the underlying facts and circumstances of the harassment. While the new laws generally ban such nondisclosure agreements, they are not prohibited where a complainant expresses a preference for entering into one.
Where the complainant asks for a nondisclosure agreement, the following process must be observed:
Importantly, this process requires the execution of two documents: (1) the agreement memorializing the complainant’s preference; and (2) the document(s) incorporating the preferred term or condition agreed upon. Suffice it to say, through policies, training, and contract clauses, the legal landscape has changed for employers in New York, and the effect of #MeToo and increased awareness of this issue are apparent.
New Anti-Sexual Harassment Laws in California
Similarly, in California, employers are also adjusting to new sexual harassment laws. For example, by January 1, 2020, employers with at least five employees must provide: (1) at least two hours of sexual harassment prevention training to all supervisory employees; and (2) at least one hour of sexual harassment prevention training to all non-supervisory employees. Training must be conducted within six months of the employee starting the position, and must be provided once every two years thereafter. Additionally, California has enacted a law regulating provisions set forth in settlement agreements related to sexual harassment, including nondisclosure clauses. Among other things, the new law prohibits a provision that prevents the disclosure of factual information underlying the allegation of sexual harassment upon which a settlement agreement is based. Such provisions entered on or after January 1, 2019, will become void as a matter of law and as counter to public policy.
But perhaps the most significant change has had less to do directly with sexual misconduct and harassment, and more to do with empowering women in the workplace. California has become the first state to require publicly traded companies to include women on their boards of directors. Signed by California Governor Jerry Brown on September 30, 2018, California Senate Bill 826 requires there to be at least one female director on the board of each California-based public corporation by the end of 2019. Also, depending on the number of board seats, companies may be required to have up to three female directors by the end of 2021. Companies are required to report their board composition to the California Secretary of State, and may be fined $100,000 for a first violation, and $300,000 for subsequent violations. Though not as directly linked to sexual harassment as the other laws discussed above, it will be interesting to see how an increase in the number of women on boards of directors in California will change things – at the state and national levels.
Thus, a year after the #MeToo movement went viral, we are seeing the movement change from something that caused greater awareness of an issue, to something that is being acted upon by way of law. Legal obligations are changing, and employers must be extra diligent to ensure compliance. As such, employers are advised to keep a pulse on current or proposed anti-sexual harassment and related laws and the extent to which their current policies and practices may be affected. Legal changes in California and New York tend to create models for other states, some of which may already have their own anti-sexual harassment laws in the works. Furthermore, employers in New York and California should update their sexual harassment policies and training programs accordingly, and make sure to distribute the policies and implement the programs as required. They should also develop a strategy to incorporate any changes that may affect contract provisions, such as nondisclosure and mandatory arbitration clauses. And, at least in California, publicly traded companies should start thinking about who will fill those female board director seats. While there are numerous other requirements pertaining to sexual misconduct and harassment that employers must be mindful of, states like New York and California have certainly begun to give the #MeToo movement a more significant and sustained impact.
About Conn Maciel Carey
Conn Maciel Carey is a boutique law firm focused on Labor & Employment, Workplace Safety, and Litigation. The clients we serve — from multi-national organizations to individuals — seek us out for strategic guidance ranging from day-to-day employment counseling to managing government regulatory investigations to leading complex litigation. What sets us apart is our special emphasis on workplace challenges, our creativity in crafting positive solutions, and our passion for serving our clients’ interests.
Looking down the barrel of a class action with substantial exposure, Starbucks argued that the amount of time (totaling $102.67 over 17 months for the named plaintiff) was too small to consider. Rejecting this argument in a decision that could affect small amounts of unpaid time in a variety of circumstances, the Court held that “[t]he relevant statutes and wage order do not allow employers to require employees to routinely work for minutes off-the-clock without compensation.”
At issue was the so-called de minimis doctrine, which derives from the maxim de minimis curat lex, which means “the law does not concern itself with trifles.” This doctrine has been part of federal law, as specified by the U.S. Supreme Court under the Fair Labor Standards Act (“FLSA”), for over 70 years, and has been used to excuse the payment of wages for otherwise compensable time in circumstances where it is administratively difficult to capture such time through customary time recording methods. In determining whether otherwise compensable time is de minimis under the FLSA, consideration is given by the Ninth Circuit Court of Appeals to (1) the practical administrative difficulty of recording the additional time; (2) the aggregate amount of compensable time; and (3) the regularity of the additional work.
As for California law in general, the Court recognized that the de minimis principle is a well-imbedded principle, and is even included as a “Maxim of Jurisprudence” in Section 3353 of the California Civil Code, which states that “[t]he law disregards trifles.” With respect to wage and hour issues in particular, the Court further recognized that the California Division of Labor Standards and Enforcement has included the de minimis doctrine in its Enforcement Policies and Interpretations Manual, as well as in its Opinion Letters, which virtually adopt the test used in the Ninth Circuit under the FLSA.
Given this long and extensive use of the de minimis doctrine, and the reliance on this doctrine by California employers in addressing wage payment issues, you might think that it would be a simple and logical matter for the California Supreme Court to recognize this doctrine. Nevertheless, the Court found that the protections afforded to employees under the wage orders compelled it to reject application of a de minimis doctrine to the off-the-clock work that was in issue in the case before it.
Specifically, plaintiff Douglas Troester filed a class action in the Los Angeles Superior Court on behalf of himself and all non-managerial California employees of defendant Starbucks Corporation who performed store closing tasks from mid-2009 to October 2010. Mr. Troester submitted evidence that Starbuck’s computer software required him to clock out on every closing shift before transmitting daily sales, profit and loss, and store inventory data to Starbuck’s corporate headquarters on a separate computer terminal in the back office. After Mr. Troester completed this report, he activated the alarm, exited the store, locked the front door, and walked his co-workers to their cars in compliance with Starbuck’s policy.
The undisputed evidence was that these closing tasks required Mr. Troester to work four to 10 additional minutes per day. Over the 17-month period of his employment, Mr. Troester’s unpaid time totaled approximately 12 hours and 50 minutes, which at the then-applicable minimum wage came to $102.67, exclusive of any penalties or other remedies.
As for these tasks, the Court assumed that they were compensable for purposes of its analysis. After considering the history of the de minimis doctrine, the Court held that (i) the California wage and hour statutes and regulations have not adopted the FLSA’s de minimis doctrine, since there is no indication in the text or history of the relevant statutes and wage orders of such adoption, and (ii) the relevant wage order and statutes do not permit application of the de minimis rule on the facts before it, where Starbucks required Mr. Troester to work “off the clock” for several minutes per shift. The Court noted that “a few extra minutes of work each day can add up,” and that the $102.67 earned by Mr. Troester over a 17-month period was enough to “pay a utility bill, buy a week of groceries, or cover a month of bus fares,” and that “[w]hat Starbucks calls de minimis is not de minimis at all to many ordinary people who work for hourly wages.”
In ruling against the de minimis doctrine in these circumstances, the Court emphasized the fact that the California Labor Code and the wage orders contemplate that employees will be paid for all work performed, in contrast with the less protective federal law that in some circumstances permits employers to require employees to work as much as 10 minutes a day without compensation. The Court’s conclusion was further reinforced by its beliefs that (i) the modern availability of class action lawsuits to some extent undermines the rationale behind a de minimis rule with respect to wage and hour actions, and (ii) many of the time recording problems that existed 70 years ago, when the U.S. Supreme Court first addressed the de minimis rule under the FLSA, no longer exist.
As for the practical administrative difficulty of recording small amounts of time for payroll purposes, which is one of the main impetuses behind the de minimis doctrine in wage cases, the Court concluded that “employers are in a better position than employees to devise alternatives that would permit the tracking of small amounts of regularly occurring work time.” The Court suggested a restructuring of the work so that employees would not have to work before or after clocking out. The Court further suggested taking advantage of technological advances in time-tracking products, or perhaps reasonably estimating work time through such things as time studies. In any event, the Court “declined to adopt a rule that would require the employee to bear the entire burden of any difficulty in recording regularly occurring work time.”
The bottom line is that the California Supreme Court believes that employees should be paid for all of their work, and that any difficulty in capturing this time for its non-exempt employees is the employer’s problem to resolve. As the Court stated, “An employer that requires its employees to work minutes off the clock on a regular basis or as a regular feature of the job may not evade the obligation to compensate the employee for that time by invoking the de minimis doctrine.”
There is some glimmer of comfort insofar as the Court expressly recognized that the de minimis rule might apply in other, appropriate circumstances, and that “a properly limited rule of reason does have a place in California labor law.” As the Court stated,
The overarching rule is, and must be, that employees are entitled to full compensation for time worked, and employers must make every reasonable effort to ensure they have adequately measured or estimated that time. But the law also recognizes that there may be some periods of time that are so brief, irregular of occurrence, or difficult to accurately measure or estimate, that it would neither be reasonable to require the employer to account for them nor sensible to devote judicial resources to litigating over them.
It remains to be seen how broad this exception will become. The plaintiffs’ bar naturally will argue that virtually any time that is capable of being recorded is required to be paid. The defense bar will understandably argue for a much broader exception. As usual, the courts will have to address this in the anticipated litigation.
In the meantime, employers should carefully review their timekeeping systems and policies to make sure that they capture all working time, and they should modify these systems and policies in accordance with the California Supreme Court’s pronouncement, beginning with placing all opening and closing duties after punching in and before punching out. Failing to do so could result in significant exposure.
Paul L. Bressan is a Shareholder and Chair of the Buchalter’s Labor & Employment Practice Group. He can be reached at 949.760.1121 or pbressan@buchalter.com
]]>Pregnancy Accommodation Under Federal Law
Title I of the ADA prohibits discrimination against employees or applicants due to their disability or perceived disability, and requires employers to accommodate disabled employees if they can still perform the essential functions of their job. The ADA applies to employers with 15 or more employees and mandates that those employers accommodate a disabled employee’s condition as long as the accommodation would not cause undue hardship on the company. Under the ADA, pregnancy itself is not a disability; however, the ADA does cover impairments related to pregnancy and birth that would qualify as disabilities under the ADA.
For example, the Equal Employment Opportunity Commission has stated that such conditions as pregnancy-related carpal tunnel syndrome, preeclampsia, gestational diabetes and pregnancy-related sciatica would all likely be disabilities covered by the ADA, even though temporary. Thus, if a pregnant employee suffers from pregnancy-related sciatica and complains to her employer of this condition, her employer is required to provide a reasonable accommodation, such as temporarily reassigning the employee to light duty or permitting the employee to take more frequent rest breaks, as long as it would not create an undue hardship.
In addition to the ADA, the Family and Medical Leave Act (“FMLA”) and the Pregnancy Discrimination Act (“PDA”) provide further requirements related to pregnant employees. In the context of pregnancy, the FMLA requires employers to permit employees up to 12 weeks of unpaid leave for the birth or care of a newborn child, and for their own serious health condition, while the PDA mandates that pregnant employees or women affected by childbirth or related conditions be treated the same as all other non-pregnant employees or applicants. Thus, under the PDA, if non-pregnant employees that complain of back pain are routinely given light duty assignments, a pregnant employee complaining of back pain should also be given a light duty assignment even if the pain is not severe enough to constitute a disability under the ADA. Additionally, employers need to remember that Title VII of the Civil Rights Act also prohibits employers from discriminating against women affected by pregnancy or childbirth as a form of sex discrimination.
It is important to keep in mind that pregnant employees and applicants, or those affected by childbirth or related conditions, do not have to be treated better than other employees, but must be treated akin to those experiencing similar conditions.
Pregnancy Accommodation Under State Law
Where states have passed laws regarding protections for pregnant workers, those laws have generally expanded the requirement to accommodate beyond the limits of the ADA. For instance, The Massachusetts Pregnant Workers Act, which goes into effect on April 1, 2018, mandates that employers provide reasonable accommodations to pregnant workers for any pregnancy or a condition related to pregnancy. Thus, the pregnancy, or a pregnancy-related condition including, but not limited to, lactation or need to express breast milk, must be accommodated if requested, even if the worker’s condition does not meet the standard for a disability under the ADA. The Massachusetts law lays out examples of what would constitute a reasonable accommodation, including more frequent or longer breaks, time off to recover from child birth, light duty, and assistance with manual labor, although the law also notes that an accommodation is not limited to these specific options.
Like the ADA, the Massachusetts law does not require an accommodation be provided where it would cause an undue hardship on the employer and lays out the specific factors that must be considered in assessing undue hardship, such as the nature and cost of the accommodation and the overall financial resources of the employer. Additionally, under this law, an employer can require documentation of the need for a reasonable accommodation from an appropriate health care or rehabilitation professional. Significantly, however, such documentation cannot be required for certain accommodations, including more frequent restroom, food or water breaks; seating; or limits on lifting over 20 pounds. Aside from the accommodation component of the Massachusetts law, it also specifically delineates what would constitute impermissible discrimination based on pregnancy or a pregnancy-related condition such as taking an adverse action against an employee who requests or uses a reasonable accommodation.
The District of Columbia, which passed its own law regarding pregnancy accommodation called the Protecting Pregnant Workers Fairness Act of 2014, similarly requires reasonable accommodation for any employee whose ability to perform her job is limited by pregnancy, childbirth, breastfeeding or a related medical condition, unless such accommodation would cause undue hardship on the company. The District of Columbia’s law also lays out typical accommodations for a covered employee much like those provided for in other states’ laws, including relocating the employee’s work area, acquisition or modification of equipment or seating, and providing private non-bathroom space for expressing breast milk. The law also permits District of Columbia employers to require certification from a medical health care provider to show the accommodation is advisable, and does not limit the types of accommodation for which such documentation can be requested. In addition, the District of Columbia law prohibits discriminatory treatment of a pregnant worker, such as requiring an employee to take leave if another accommodation can be provided or denying an employment opportunity due to the worker’s request for an accommodation.
Beyond the requirements of these state laws, it’s important to remember that they tend to apply to a larger number of employers due to the lower employee threshold that triggers their requirements. For example, Connecticut’s law, which requires reasonable accommodations for employees and applicants based on pregnancy, childbirth, or related conditions, applies to all employers with at least 3 employees. A similar California law applies to all public employers and private employers with 5 or more employees, while the District of Columbia and New Jersey laws apply to all employers.
Many of the state laws also usually require some form of notice to employees of the rights the law protects and its relevant provisions. The applicable law may provide for a specific notice to be circulated or posted, such as the District of Columbia and Maryland, or may more broadly define the notice requirement, giving employers an option of how to provide it.
In sum, although state pregnancy laws have many similarities and some important differences, they are generally consistent in expanding protections similar to the ADA to any employee affected by pregnancy or child birth, and it is likely that any enforcement body will view the accommodations outlined in these laws as reasonable for most, if not all, employers.
What Employers Should Do to Comply
Because pregnancy accommodation laws vary from state to state, it is important for employers to be aware of the specific requirements of the law in each state in which they operate. For example, one state may permit an employer to require medical documentation no matter the type of accommodation, while another state, like Massachusetts or Washington, restricts the employer’s ability to request documentation for certain types of accommodations like seating or longer/more frequent rest breaks. Even an employer operating only in a single state should be aware of the nuances of any pregnancy accommodation law, such as whether the law is even applicable based on the size of the employer.
If an employer operates in a state with a pregnancy accommodation law, it should ensure that its handbook, as well as any relevant stand-alone policies, clearly notify employees of their rights and how to exercise those rights to obtain an accommodation. Additionally, because many state pregnancy laws require an employer to subsequently notify an employee of their rights if the employee informs the employer of a pregnancy or a pregnancy-related condition, employers in those states must be prepared to provide additional notification in that circumstance.
Finally, employers should ensure that they provide training to management about how to effectively address the need for an accommodation to ensure that pregnant workers or workers with a pregnancy-related condition are provided an appropriate accommodation, and are not treated any differently for requesting or receiving that accommodation.
]]>Hurricanes Harvey, Irma and Jose have hit, are hitting, and will soon be hitting the United States, and first and foremost, employers need to make sure their employees, customers, and guests are safe from the storm.
Natural disasters such as hurricanes, earthquakes and tornadoes have posed unique human resource (HR) challenges from wage-hour to FMLA leave and the WARN Act. The best protection is to have a plan in place in advance to ensure your employees are paid and well taken care of during a difficult time.
Although no one can ever be fully prepared for such natural disasters, it is important to be aware of the federal and state laws that address these situations. Our guidance can be used by employers in navigating through the legal and business implications created by events such as Hurricanes Harvey, Irma, and Jose. In addition, the information may be applicable to other crises and disasters, such as fires, flu epidemics and workplace violence.
Frequently Asked Questions
If a work site is closed because of the weather or cannot reopen because of damage and/or loss of utilities, am I required to pay affected employees?
The Fair Labor Standards Act requires employers to pay their non-exempt employees only for hours that the employees have actually worked. Therefore, an employer is not required to pay nonexempt employees if it is unable to provide work to those employees due to a natural disaster.
An exception to this general rule exists when there are employees who receive fixed salaries for fluctuating workweeks. These are nonexempt employees who have agreed to work a specified number of hours for a specified salary. An employer must pay these employees their full weekly salary for any week in which any work was performed.
For exempt employees, an employer will be required to pay the employee’s full salary if the work site is closed or unable to reopen due to inclement weather or other disasters for less than a full workweek. However, an employer may require exempt employees to use available leave for this time.
Is it lawful to dock the salaries of exempt employees who do not return to work when needed after an emergency or disaster?
The U.S. Department of Labor considers an absence caused by transportation difficulties experienced during weather emergencies, if the employer is open for business, as an absence for personal reasons. Under this circumstance, an employer may place an exempt employee on leave without pay (or require the employee to use accrued vacation time) for the full day that he or she fails to report to work.
If an employee is absent for one or more full days for personal reasons, the employee’s salaried status will not be affected if deductions are made from a salary for such absences. However, a deduction from salary for less than a full-day’s absence is not permitted.
We recommend caution, however, in docking salaried employees’ pay and suggest that you first consult with legal counsel. Moreover, many employers instead require employees to “make up” lost time after they return to work, which is permissible for exempt employees. This practice is not allowed for nonexempt employees, who must be paid overtime for all hours worked over 40 in a workweek.
What other wage and hour pitfalls should employers be aware of following a hurricane or other natural disaster?
On-call time: An employee who is required to remain “on call” at the employer’s premises or close by may be working while “on call,” and the employer may be required to pay that employee for his “on call” time. For example, maintenance workers who remain on the premises during a storm to deal with emergency repairs must be compensated — even if they perform no work — if they are not free to leave at any time.
Waiting time: If an employee is required to wait, that time is compensable. For example, if employees are required to be at work to wait for the power to restart, that is considered time worked.
Volunteer time: Employees of private not-for-profit organizations are not volunteers if they perform the same services that they are regularly employed to perform. They must be compensated for those services. Employers should generally be cautious about having employees “volunteer” to assist the employer during an emergency if those duties benefit the company and are regularly performed by employees.
Can employees affected by a hurricane seek protected leave under the Family and Medical Leave Act (FMLA)?
Yes, employees affected by a natural disaster are entitled to leave under the FMLA for a serious health condition caused by the disaster. Additionally, employees affected by a natural disaster who must care for a child, spouse or parent with a serious health condition may also be entitled to leave under the FMLA.
Some examples of storm-related issues might include absences caused by an employee’s need to care for a family member who requires refrigerated medicine or medical equipment not operating because of a power outage.
If a work site or business is damaged and will not reopen, what notice must be provided to affected employees?
The Worker Adjustment and Retraining Notification (WARN) Act, a federal law, imposes notice requirements on employers with 100 or more employees for certain plant closings and/or mass layoffs. However, an exception exists where the closing or layoff is a direct result of a natural disaster.
Nonetheless, the employer is required to give as much notice as is practicable. If an employer gives less than 60 days’ notice, the employer must prove that the conditions for the exception have been met. If such a decision is contemplated, it is advisable to consult with legal counsel about the possible notice requirements to ensure compliance with the WARN Act.
Our HR department has been disrupted, and it may be weeks before things are back to normal. Will the government extend any of the customary deadlines governing employer payment for benefits, pension contributions and other subjects during this recovery effort?
During previous natural disasters, particularly Hurricane Sandy and Katrina, many governmental agencies and entities extended the deadlines for certain reports and paperwork. Therefore, it is expected that with future natural disasters, the government will provide some deadline extensions, but, as with every natural disaster, the government’s response will vary.
Regardless of what extensions may be granted, employers should be fully aware of state laws and implement any policies or plans necessary to minimally interrupt the payment of wages to their employees.
Employees from other states want to donate leave to affected employees. Is this lawful?
Yes. Employers can allow employees to donate leave to a leave bank and then award the donated leave to the affected employees.
Disaster Preparation Checklist
Natural disasters can pose a myriad of HR challenges for employers. While many employers are working around the clock on recovery efforts, other employers find themselves unable to function for extended periods of time because of damage or loss of utilities. The economic effects of a natural disaster will have long-term consequences on businesses in the affected region.
]]>Benefits for Employers
Enhancing company security and employee safety. Implanted chips can’t easily be lost, stolen or loaned, making facilities more secure from outsiders. If they track location, chips can provide accurate employee location information to help resolve theft or misconduct investigations or to find employees in the event of a weather emergency or other workplace safety incident.
Refining time clock procedures and wellness programs. Chips could help ensure that employees are being paid for all time worked, because they could be more accurate than standard time clock or “badging” payroll approaches. Badging technologies leave open the possibility “tailgating” — entering a facility through a secured door by closely following someone who has “badged in” — which hinders accurate payroll information and attendance tracking. Properly used, the chip could offer employees feedback on health metrics as an enhancement to a company wellness program.
Improving recruiting competitiveness. Offering chip alternatives may enhance companies’ reputations and recruiting opportunities if candidates view them as being on the leading edge. In particular, tech-comfortable millennials may be drawn to the idea of entering facilities, paying for food in a company cafeteria and conducting other transactions without carrying separate badges, credit cards, etc.
Communicating With Employees
Before deciding whether to receive a chip, employers should clearly communicate:
Privacy Concerns
A chip program would need to address employees’ reasonable expectations of privacy. Employers should be forthright about whether and what monitoring would take place outside of work hours and activities, especially if the chips track location.
Medical information that chips could collect is a key privacy concern. The Americans With Disabilities Act (ADA) prohibits employers from making post-employment medical exams or inquiries without a specific, well-documented and job-related business necessity, so employers should not monitor individual medical information from chips. Even for purposes of employer-sponsored wellness programs, employers may only view employee medical information in aggregate form that does not disclose individuals’ identities. If the wellness program is part of the employer’s group health plan, Health Insurance Portability and Accountability Act (HIPAA) privacy, security and breach notification protections apply.
Other Employer Liabilities
In addition to data privacy concerns, including the possibility of data breaches, employers using such chips face the risk of knowing too much. If the chips collect data that is not relevant to employment decisions, and then actually or allegedly misuse that data, it could lead to discrimination claims. Microchipping could hurt recruiting if potential candidates perceive the company as a “big brother” employer. Employees who consent to implantation may later say they felt pressured to do so against their will or were not properly informed about the risks – and claim coercion.
The chips also present possible medical issues, such as infection or fear of cancer, as well as technological risks. How will an employer deal with chip malfunctions or technological advances that make the chips obsolete?
Alternative Options
Before jumping on the microchipping trend, employers should consider less invasive alternatives such as fingerprint recognition devices, “smart” badges that employees keep with them at work (which could also be used for wellness program activity tracking) and vehicle GPS tracking for field personnel.
Thomas J. Posey, Partner
Faegre Baker Daniels LLP
311 S. Wacker Drive, Suite 4300
Chicago, IL 60606, USA
Main: (312) 212-5500
Direct: (312) 212-2338
Email: thomas.posey@faegrebd.com
8 YEARS of EXPERIENCE AS ACCOUNT EXEC
The fact-pattern is one that is often seen. Justine Larison began working for FedEx as a sales account executive in March 2007 and remained in this position until her termination in July 2015 at the age of 45. Larison’s employment was considered to be generally acceptable for the first five years of her employment until an appreciably younger woman, Stephanie Nardiello, became her manager in 2012, according to the opinion.
NEW MANAGER
Within a year of becoming her manager, Nardiello began to criticize Larison, stating that “she needed to focus on closing new business accounts.” A few months later, in early 2014, Nardiello told Larison that her sales activity was “unacceptable and needs to improve” within the next 60 days, the opinion said. Nevertheless, in June 2014, Nardiello rated Larison’s over-all performance as “generally acceptable” and specifically rated her sales performance as “meets some expectations.” As such, when Nardiello requested the authorization to terminate Larison in August, 2014, FedEx’s human resources adviser denied the request. Instead, Nardiello issued Larison a “warning letter regarding her deficiency in closing new business,” along with a plan to regularly meet with Larison.
Two weeks later, however, Nardiello requested that her weekly coaching meetings with Larison be canceled because Larison was complaining about them. Her request to human resources added, “I plan on pursuing this at the end of her second warning letter on Sept. 29.” The human resources adviser believed that the “this” was Larison’s termination. Larison was not terminated at the end of September 2014. In December, Nardiello issued yet another warning letter to Larison. This, despite the fact that Larison’s sales performance had improved.
This article was originally published by The Legal Intelligencer. Click here to continue reading.
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