Author: James Hatch

Charles Mickey was employed by Zeidler Tool and Die Co. for 33 years. In October 2004, at age 64, he was asked about his retirement plans and then received a pay cut on the grounds that the company was not doing well. A younger manager, however, received a pay raise.

    Mickey’s EEOC charge of age discrimination was received by Zeidler on October 14, 2004. After the company learned of his EEOC charge, Mickey was immediately laid off. However, financial records indicated that Zeidler was profiting and advertising for new positions.

    Mickey brought suit in the U.S. District Court for the Eastern District of Michigan, alleging age discrimination and retaliation.

    The district court granted summary judgment in favor of the employer on the grounds that Mickey failed to establish a prima facie case of unlawful retaliation, reasoning that the time between the filing of the EEOC notice and his layoff was not sufficient to demonstrate a connection between the protected activity of filing the EEOC charge and adverse employment action.

    The U.S. Court of Appeals for the 6th Circuit in Cincinnati reversed, stating, “Where adverse employment action occurs very close in time after an employer learns of a protected activity, such temporal proximity between the events is significant enough to constitute evidence of a causal connection for the purposes of satisfying a prima facie case of retaliation.”

    Since Mickey had been abruptly terminated on the same day that Zeidler had learned about the EEOC charge, the case was remanded to district court for a trial. Mickey v. Zeidler Tool and Die Co., No. 06-1960 (1/31/08).

    Impact: When an employee is fired immediately after the employer learns of a protected activity, it can be inferred that there is a causal connection between the two actions, even if the employee does not present other evidence of retaliation.

p>Workforce Management, March 3, 2008, p. 7 — Subscribe Now!

United Parcel Service employees could bid for package-car driver jobs, which included a hearing test mandated by the U.S. Department of Transportation for drivers operating vehicles that weighed 10,000 pounds or more. The DOT’s regulations did not apply to UPS’ package vehicles since their weight was less than 10,000 pounds.

In May 1999, five UPS employees filed a lawsuit alleging violations of the Americans With Disabilities Act and related California law, saying UPS discriminated against them when it denied promotional opportunities to the package-car driver positions.

A $9.9 million partial settlement resolved certain of the claims, except those involving the denial of driving jobs to deaf workers. The U.S. District Court for Northern California conducted a trial on those remaining issues, held that UPS violated the ADA and state law, and issued an injunction requiring UPS to assess each hearing-impaired applicant individually for the position of driving vehicles.

On appeal, the U.S. Court of Appeals for the 9th Circuit in San Francisco agreed that UPS violated the ADA by not allowing deaf employees to be considered for jobs in its smaller package vehicles not covered by DOT regulations.

The 9th Circuit granted rehearing of the case, and reversed the trial court’s grant of an injunction. It held that the district court misapplied the ADA in deciding that UPS could not satisfy a business-necessity defense for its driver hearing standards and in deciding that hearing-impaired drivers were qualified individuals with disabilities under the ADA. Bates v. United Parcel Service, Inc., 9th Cir. (en banc), No. 04-17295 (12/28/07).

Impact:The employee alleging that hiring requirements violate the ADA must show that he or she is qualified to perform the essential functions of the job at issue. The bona fide occupational qualification defense does not apply to ADA claims.

Workforce Management, March 3, 2008, p. 7 — Subscribe Now!

The Equal Employment Opportunity Commission has issued a final rule that exempts employer-sponsored retiree health benefit plans from the Age Discrimination in Employment Act to allow plans to alter, reduce or eliminate such benefits when a retiree turns 65 and becomes eligible for Medicare.

According to the new rule, employers may, at their discretion, provide retiree benefits “only to those retirees who are not yet eligible for Medicare,” and may “alter, reduce or eliminate” retiree health benefits for those retirees who become eligible for Medicare. Essentially, the new rule allows for employers to establish two categories of retirees and to offer more comprehensive benefits to those under 65 and more limited benefits or no benefits to those over 65.

In its preamble to the final rule published in the Federal Register, the EEOC concluded: “The final rule is not intended to encourage employers to eliminate any retiree health benefits they may currently provide.”

It should also be noted that AARP has a pending challenge to the EEOC’s authority to issue the exemption in a federal district court case in Pennsylvania. The Court of Appeals for the 3rd Circuit upheld a ruling in favor of the EEOC, holding that the commission had shown that the exemption was “a reasonable, necessary and proper exercise of its authority.” In November 2007, AARP filed a petition for review by the United States Supreme Court. That remains pending. 29 CFR Parts 1625 and 1627.

    Impact: Employer-sponsored health plans are relied on by more than 10 million retirees as their primary source of health coverage or as a supplement to their Medicare benefits. The EEOC’s final rule, effective December 26, 2007, has been met with support among the employer, labor union and benefits community, but has been vehemently opposed by AARP, the advocacy group for older Americans. Employers should continue to monitor this issue as to the Supreme Court’s final ruling on the matter.

Workforce Management, February 18, 2008, p. 8 — Subscribe Now!

Elizabeth Rask worked two days a week as a kidney dialysis technician for Fresenius Medical Care North America, where she cared for seriously ill patients. After she failed to report to work on May 28, 2004, and due to her pattern of absences, Rask was fired. Rask alleged that she had notified her two supervisors of her struggle with depression when she told them that she was experiencing problems with her medication and that “I might need to miss a day here and there because of it.”

    Rask brought suit in the U.S. District Court for the District of Minnesota, alleging that Fresenius violated the Americans With Disabilities Act and the Minnesota Human Rights Act by discriminating against her because of her depression. She also asserted that the absences that led to her termination were protected under the Family and Medical Leave Act as she suffered a “serious health condition,” which would qualify her for unpaid leave under the statute. The district court granted summary judgment in favor of the employer on all claims.

    The U.S. Court of Appeals for the 8th Circuit held that Rask was not a “qualified individual” under the ADA. Because Rask was unable to work on a regular and consistent basis, she was not able to perform an essential function of her job, and therefore was not a qualified individual under the statute.

    The court found that “the ability to take sudden, unscheduled absences would not have assisted Ms. Rask in performing the duties of her particular job; they would have been for her personal benefit.” Finally, the court also agreed that Rask had failed to put Fresenius on notice that she had a serious health condition that would make her eligible for FMLA leave. Rask v. Fresenius Medical Care North America, 8th Cir., No. 06-3923 (12/6/07).

    Impact: An employee who cannot perform essential job duties of regular and predictable attendance, regardless of his or her alleged disability, is not ADA protected.

    Workforce Management,February 18, 2008, p. 8 — Subscribe Now!

Ralph’s Grocery Co. implemented an incentive compensation plan where eligible employees could receive supplemental sums over and above regular wages based on profits from its stores. The employer’s incentive plan identified a bonus pool derived from each of its stores’ net profits, which included offsets of store operating expenses for workers’ compensation costs and cash losses.

    A produce manager for Ralphs filed suit and alleged that the bonus plan violated the California Labor Code and regulations that prohibit an employer from shifting certain of its business costs to employees. Specifically, California law precludes an employer from using employees’ wages to shift business losses to employees—or to make employees the insurers of such losses—and from collecting or receiving any part of paid wages and deductions from employee earnings to cover costs.

    The California Supreme Court ruled that the Ralphs incentive compensation plan did not violate these laws. The court reasoned that Ralphs did not take any unauthorized deductions from promised wages. Rather, the supplementary compensation that Ralphs promised under the bonus plan was intended to promote and reward employee teamwork that produces a net profit for the store as a whole. Furthermore, nothing in California law prohibited an employer from offering its employees, over and above their guaranteed base wages, supplementary incentive compensation on the basis of store profits that remain after legitimate store expenses, including the costs of workers’ compensation, have been subtracted from store revenues. Prachasaisoradej v. Ralphs Grocery Co. Inc., Cal. Supreme Court, Nos. S128576 (8/23/07).

    IMPACT: Employers should proceed with caution when making deductions from employees’ wages. However, California employers may use profitability measures that take into account legitimate business expenses in the calculation of employee bonus compensation. In all cases, employers should give careful consideration of applicable regulations, cases, laws and statutes before adopting compensation plans that calculate benefits based on overall profits.

Workforce Management, January 14, 2008, p. 6 — Subscribe Now!

From 1990 until 2003, the U.S. Postal Service in Chagrin Falls, Ohio, granted a religious accommodation to Martin Tepper, a mail carrier who was a practicing Messianic Jew, by not assigning him Saturday work schedules. Tepper’s union contract provided that all mail carriers received Sunday off and that the second day off per week was determined on a rotating basis—with the exception of Tepper, who always was given Saturday off so that he could observe the Sabbath. When staffing levels decreased, other employees were scheduled to work extra Saturdays or were asked to cover Tepper’s routes.

After other mail carriers objected, employees voted to recommend termination of Tepper’s religious accommodation. Tepper was allowed to use annual leave and other unpaid leave to take off Saturdays, and stopped working on a significant number of Saturdays for 2003 and 2004. Tepper sued for violations of Title VII, claiming that the Postal Service had refused to accommodate his religious beliefs as required by Title VII.

A U.S. district court dismissed the case, and the U.S. Court of Appeals for the 6th Circuit in Cleveland affirmed. The 6th Circuit held that Tepper could not demonstrate that he had been discharged or disciplined. Since Tepper was “simply not being paid for time that he has not worked,” the court stated, his pay reduction did not constitute a materially adverse employment action. Working Saturdays was just a requirement of the job for which he was hired, the 6th Circuit held. The court also rejected Tepper’s argument that he was treated differently from other employees who were able to avoid working on their Sabbaths (usually Sundays), since the Postal Service limited Sunday job assignments. Tepper v. Potter, 6th Cir., No. 06-4182 (10/15/07).

Impact: Employers are not necessarily required to accommodate an employee’s religious beliefs by allowing them to have their Sabbath off, if the accommodation would provide a hardship to the employer.

Workforce Management, November 5, 2007 — Subscribe Now!

Herbert Conley, a truck driver of 15 years for Yellow Freight System Inc., was terminated in 2003. Before his termination, Conley had complained that his supervisor had encouraged drivers to drive at unsafe speeds to increase efficiency. After he complained, Conley had received a warning that he had failed to sign in and out of work as required by his union labor agreement. Conley was advised that the company intended to fire him and he continued working for several months until he was discharged after a hearing.

Conley filed a lawsuit in Tennessee state court, alleging that requiring a driver to operate a truck while fatigued violated federal safety standards and that he had been terminated for “refusing to engage in illegal activities.” More specifically, Conley alleged that his termination violated the Tennessee Public Protection Act and state law on retaliatory discharge.

Yellow Freight transferred the case to the U.S. District Court for the Eastern District of Tennessee. The company filed a motion for summary judgment to dismiss Conley’s claims on the grounds that his claims were blocked by the federal Surface Transportation Assistance Act. The district court refused to dismiss the action because the act did not pre-empt state law claims and did not prevent lawsuits under state law for retaliatory discharge.

Concluding that there were factual issues about the company’s motive for firing Conley, the district court refused to dismiss his claim under the Tennessee Public Protection Act. However, the court did dismiss his retaliatory termination claim, reasoning that such claims are only available to workers employed “at will.” Conley’s employment was under a labor agreement. Conley v. Yellow Freight Sys. Inc. ED Tenn., No. 1:06-cv-164 (10/9/07).

Impact: Many federal laws regulate working conditions, including those for over-the-road drivers. They will typically not foreclose state common law claims for wrongful termination.

Workforce Management, November 5, 2007 — Subscribe Now!

After her hire at a Morgan Stanley subsidiary in 2000, Beverly Robinson informed her supervisor about her allergy to perfumes and other fragrances and requested an accommodation. Morgan Stanley took steps, including changing Robinson’s seat, allowing her to use an alternative rental car service and sending a memo to employees asking they be considerate of co-workers sensitive to fragrances.

In filling out a medical certification form, Robinson’s doctor stated in 2003 that Robinson had an “extremely high sensitivity” to fragrances, but she didn’t have a “serious medical condition” as defined by the Family and Medical Leave Act. When filling out the same form in 2004, Robinson’s doctor indicated Robinson had a serious medical condition. Robinson was terminated the same day she submitted the form. Robinson sued Morgan Stanley under the Americans With Disabilities Act.

In granting summary judgment to Morgan Stanley, the U.S. District Court for the Northern District of Illinois in Chicago said Robinson did not raise a triable issue; was not disabled within the meaning of the ADA; and even if she were, given Morgan Stanley’s accommodations, she failed to show she was not reasonably accommodated.

In concluding Robinson was not disabled, the court stated her symptoms were temporary and she only considered herself disabled when exposed to perfumes or fragrances. The court found Robinson was never hospitalized for the condition. There was no record of her impairment; even Robinson’s doctor never classified her as having any limitation to a major life activity. Robinson v. Morgan Stanley Dean Witter, N.D. Ill., No. 05-C-04258 (8/31/07).

Impact:An employee with a condition that causes only temporary symptoms will likely not meet a threshold requirement of being disabled under the ADA.

Workforce Management, October 8, 2007, p. 10 — Subscribe Now!

Bernard Lehman was hired to work for U.S. Steel at its Dravosburg, Pennsylvania, plant to do mechanical maintenance work, and in 2004 was assigned as a rail tractor driver. After he began those job duties, Lehman discovered he had arthritis, and his symptoms worsened.

    Lehman received chiropractic treatments and was told that his arthritis was being aggravated by the constant jarring of the rail tractor. His doctor recommended that Lehman indefinitely not work with heavy equipment that affected his neck and back. After reviewing a doctor’s note from Lehman, U.S. Steel’s doctor evaluated him and concluded that he could work, but should not drive a rail tractor.

    U.S. Steel removed Lehman from the work schedule until he could drive a tractor and placed him on involuntary leave. After filing a union grievance, Lehman was returned to work in a non-driving position that did not aggravate his arthritis, but only several weeks after he was placed on involuntary-leave status.

    Lehman filed suit against U.S. Steel, contending that the company violated the Americans With Disabilities Act and had failed to reasonably accommodate his disability by refusing to reassign him to a job consistent with his medical conditions.

    A U.S. District Court in Pennsylvania denied U.S. Steel’s motion for summary judgment and agreed that Lehman’s arthritis substantially limited the performance of major life activities. With regard to his claim that U.S. Steel had refused to accommodate his condition, the district court noted that, while Lehman was eventually permitted to return to work to a job that did not aggravate his condition, a jury could conclude that the company could have reassigned him to another available position before placing him on involuntary leave. Lehman v. U.S. Steel Corp., WD Pa., No. 05-1479 (9/17/07).

    Impact: Employers are advised to promptly determine if reasonable accommodations may exist for disabled employees, including reassignments to vacant positions.

Workforce Management, October 8, 2007, p. 10 — Subscribe Now!

Jacqueline Davis began working for O’Melveny & Meyers, a Los Angeles-based law firm, in June 1999. Following her hire, O’Melveny implemented a mandatory dispute resolution program for employment-related disputes for its employees. Excepted from the program were claims for workers’ compensation or unemployment benefits as well as claims by the firm associated with disclosure of confidential materials.

    The program included an option for mediation and mandatory final and binding arbitration for employment-based claims against O’Melveny. Disclosure to third parties of the existence or nature of any disputes submitted to the program was prohibited under the policy.

    Davis filed a lawsuit against O’Melveny for failure to pay her for overtime and work during meal and break periods. A U.S. district court ordered the matter to final and binding arbitration pursuant to the terms of the program.

    On appeal, the U.S. Court of Appeals for the 9th Circuit held that the program was procedurally and substantively unconscionable—and, accordingly, unenforceable.

    The court reasoned that the arbitration provisions were imposed on a “take it or leave it” basis, leaving Davis with the “choice” only to accept its terms or seek employment elsewhere. O’Melveny’s plan improperly imposed a substantially shortened statute of limitations that deprived employees of a number of available employment claims under the continuing violation doctrine. Also, the confidentiality provisions of the program stifled an employee’s investigation of claim and placed O’Melveny in a superior position to defend. Davis v. O’Melveny & Meyers, 9th Cir., No. 04-56039 (5/14/07).

    Impact: California law has for several years prohibited enforcement of mandatory arbitration procedures that are unconscionable. Employers are advised to carefully review the costs involved in mandatory arbitration and the specific process by which employment-based claims can be resolved by arbitration which have met with court approval.

Workforce Management, July 23, 2007, p. 10 — Subscribe Now!