Author: Site Staff

The question recently came up in the Workforce Online Legal Forum, “Can supervisors be ‘individually’ liable for sexual harassment?”

On a federal level, the answer, generally, is no, although there are exceptions to this rule for high level employees and agents, or sole proprietorships. Rules under state common law or discrimination statutes vary from state to state. Your state fair employment practices agency can provide you more information.

Source: Epstein, Becker & Green, November 10, 1998, New York.

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Employers may not terminate workers for use of leave protected by the Family and Medical Leave Act (FMLA).

Martha Bryan, an assembly-line worker for Delbar Products Inc., left work early to care for her son who was hospitalized for kidney failure, despite denial of her leave request. She was then assessed a penalty “point” under the company’s absentee policy, placed on probation, and terminated one year later for excessive absenteeism after she earned six points. Bryant sued, alleging a violation of the FMLA.

A federal district court held Bryant was entitled to recovery because her termination was “a direct result” of the denial of FMLA leave. Bryant’s leave was protected under the FMLA because her son had a serious health condition and without the “point” assessed against her, Bryan would not have been fired. Bryant vs. Delbar Products Inc., M.D. Tenn., No. 2:97-0100, 8/27/98.

Impact:
Employers should know that even distant results of acts in violation of the FMLA can create liability.

Source: D. Diane Hatch, a San Francisco-based human resources consultant, & James E. Hall, an attorney with Barlow, Kobata & Denis, with offices in Los Angeles and Chicago.

Communications between a human resources member and the company’s legal counsel may be protected from disclosure in any later employment litigation.

A sexual harassment charge was filed against a Kaiser Foundation Hospitals physician. The human resources department consulted with Kaiser’s attorneys, investigated the claim and prepared a report. Three plaintiffs, who filed suit for sexual harassment, sought discovery of the complete investigatory files. Although Kaiser produced some 90 percent of its files, it refused to produce the records of communications between its HR staff and attorneys.

On appeal, after the trial court ordered production of those documents, the California Court of Appeals stayed the disclosure order because such documents could well be protected from disclosure by the attorney-client and work-product privileges. Kaiser Foundation Hospitals vs. Superior Court of San Mateo County, Cal. Ct. App., No. A081771, 9/28/98.

Impact:
An employer’s investigation of employment claims under the direction of its attorneys may be protected from disclosure, and therefore, requests to produce the resulting documents should be resisted.

Source: D. Diane Hatch, a San Francisco-based human resources consultant, & James E. Hall, an attorney with Barlow, Kobata & Denis, with offices in Los Angeles and Chicago.

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Failure to provide appropriate medical care to lower costs and thereby increase a physician’s bonus supports a breach of fiduciary duty claim under the Employee Retirement Income Security Act (ERISA).

When Cynthia Herdrich’s physician delayed an ultrasound on an inflamed mass in her abdomen, her appendix ruptured causing peritonitis, a life-threatening illness. Herdrich sued the medical clinic, the medical insurance company, the physician and the HMO for negligence and breach of fiduciary duty under ERISA. Based on evidence that the delay had increased Herdrich’s physician’s year-end bonus, which was calculated, in part, on lowering costs expended for treatment, a jury awarded Herdrich compensatory damages of $35,000 on the negligence claim. However, the district court dismissed her ERISA claim.

In a case of first impression, the U.S. Court of Appeals for the Seventh Circuit reversed the dismissal of the ERISA claim. As fiduciaries, the HMO review board was required to act in the interest of the plan beneficiaries. The decision to delay needed care, if as alleged to save money and secure bonuses, may be a breach of their fiduciary duty. Herdrich v. Pegram, 7th Cir., No. 97-1070, 8/18/98.

Impact:
To avoid a breach of fiduciary duty under ERISA, those in control of HMO plan assets must act in the best interest of the plans’ beneficiaries.

Source: D. Diane Hatch, a San Francisco HR consultant, and James E. Hall, an attorney with Barlow, Kobata & Denis (based in Los Angeles and Chicago).

The EEOC has issued guidelines for review of retaliation claims under Title VII of the 1964 Civil Rights Act, the Age Discrimination in Employment Act, the Americans with Disabilities Act, and the Equal Pay Act.

Employers may not retaliate against those who: file or threaten to file a charge, assist in an investigation, complain about alleged discrimination, refuse to obey an order believed to be discriminatory or request reasonable accommodation.

The EEOC guidelines for review of retaliation claims address the following issues:

• Charging parties include members of a protected class as well as current employees who are not members of the protected class, former employees and individuals “closely related to or associated with” the person who is being retaliated against.
• Any retaliatory treatment “can be challenged regardless of the level of harm” to the individual.
• Even threats and reprimands qualify as retaliation. In addition, post-employment actions based on a retaliatory motive that interfere with future job prospects can be actionable.
• Opposition to employment practices is protected if based on a reasonable and good faith belief of their illegality. “EEOC Guidance on Investigating, Analyzing Retaliation Claims,” EEOC Compliance Manual, 5/26/98.

Impact:
Employers should be aware of their considerable liability under the federal civil rights laws not only for discrimination, but also for retaliation against employees who assert these civil rights.

Source: D. Diane Hatch, a San Francisco HR consultant, and James E. Hall, an attorney with Barlow, Kobata & Denis (based in Los Angeles and Chicago).

Returning veterans, under the Uniformed Services Employment and Reemployment Rights Act of 1994 (USERRA), must provide “reasonable notice” to employers that they want their jobs back to be entitled to reinstatement.

David McGuire, a former United Parcel Service (UPS) sales representative, returned from duty in Bosnia in 1996. When he contacted his previous supervisor requesting reinstatement, he was referred to the human resources department. Because he failed to complete a “return to work” form as required by UPS, McGuire was not reemployed, and he sued.

On appeal, the U.S. Court of Appeals for the Seventh Circuit affirmed the lower court’s summary judgment for UPS, holding that McGuire had failed to provide notice of his desire to return by following UPS’s procedure for reinstatement. The court stressed that USERRA does not require a specific form or procedure, but that each claim will be considered individually. McGuire vs. United Parcel Service, 7th Cir., No. 97-3455, 8/10/98.

Impact:
Employers do not violate veteran rights under USERRA by refusing reinstatement if reasonable notice of the desire to return is lacking.

Source: D. Diane Hatch, a San Francisco HR consultant, and James E. Hall, an attorney with Barlow, Kobata & Denis (based in Los Angeles and Chicago).

Are you facing decisions about early retirement offers, and are concerned about the ADEA (age-discrimination law)? The case below may interest you. Generally speaking, what the circuit court decided was that because the plaintiff chose to retire, it was not age discrimination.

Johnson v. Runyon, 137 F.3d 1081 (8th Cir., March 6, 1998).

Plaintiff was 52 years of age and a tour superintendent at the agency when the agency embarked on a major reorganization. All tour superintendent positions were abolished, but a higher-level position requiring additional skills was created. Plaintiff along with others was offered early retirement. An agency official later informed him that he did not intend to hire him for one of the new higher-level positions, on the grounds that he lacked the required skills. The official testified that he informed plaintiff because plaintiff had to make his early retirement decision. The official also testified that he told plaintiff that he would still have a job with the agency, and would not be reduced in pay.

Plaintiff accepted the early retirement offer, but testified that he had not intended to retire early. He filed suit, alleging age discrimination, after the agency selected persons for the higher-level position who ranged in age from 36 to 48. The district court entered judgment in favor of the agency. The district court found that plaintiff failed to make a prima facie showing; because he retired voluntarily, he did not suffer an adverse employment action.

The circuit court agreed. The court stated that where there was no adverse employment action, plaintiff could recover only if he could show that he was constructively discharged. The court noted that plaintiff chose to retire rather than to wait and see what positions would be available after the reorganization. No reasonable person would have found these working conditions so intolerable that they would force an employee to quit, ruled the circuit court.

Contact your attorney for more information about age discrimination.

Source: U.S. Equal Employment Opportunity Commission, Washington, D.C.

What should you keep in mind when posting employee handbooks on your Intranet?

First, move your disclaimers to make it clear that the employee reads them and acknowledges them. You can build your system to require a disclaimer acceptance form in order to gain access to the “on-line” handbook.

Second, changes to the handbook could be sent to all employees via electronic mail with a mandatory “read this notice” warning. Most e-mail systems allow e-mail to be sent the equivalent of certified mail, return receipt requested. Every receipt can be printed out and stored in a personnel file (for those of us who cling to paper) or stored electronically.

Finally, each location should have a current print book for those who decide they do not want to read a handbook off of a computer screen.

Some other ideas to enhance the system:

• Your vacation request policy can have a drop-down box with a vacation request form which can be printed or filed out electronically.
• Your summary plan descriptions can be linked to your handbook, as can your annual report, your latest press releases, even your latest commercials.
• HR contact telephone and e-mail addesses can be added and updated whenever necessary by the touch of a button.

Source: Epstein, Becker & Green, New York, July 31, 1998.

Is it considered age discrimination to put a line in a classified ad asking that applicants have a certain number of years of experience?

That line alone is unlikely to violate the Federal ADEA, which governs age discrimination. Experience does not equal age, since many “young” people have lots of experience in a particular field and many “older” people have no experience.

Source: Epstein, Becker & Green, New York, July 29, 1998.

Important—This certificate provides evidence of your prior health coverage. You may need to furnish this certificate if you become eligible under a group health plan that excludes coverage for certain medical conditions you have before your enrollment in the new plan. This certificate may need to be provided if medical advice, diagnosis, care or treatment was recommended or received for the condition within the six-month period prior to your enrollment in the new plan. If you become covered under another group health plan, check with the plan administrator to see if you need to provide this certificate. You may also need this certificate to buy, for yourself or your family, an insurance policy which does not exclude coverage for medical conditions that are present before you enroll.

1. Date of this certificate:

2. Name of group health plan:

3. Name of participant:

4. Identification number of participant:

5. Name of any dependents to whom this certificate applies:

6. Name, address, and telephone number of plan administrator

or issuer responsible for providing this certificate:

7. For further information, call:

8. If the individual(s) identified in line 3 and line 5 has at least 18 months of
creditable coverage (disregarding periods of coverage before a 63-day break),
check here____and skip lines 9 and 10.

9. Date waiting period or affiliation period (if any) began:

10. Date coverage began:

11. Date coverage ended:

12. (Or today’s date if coverage continues as of the date of this certificate:)

Note: Separate certificates will be furnished if information is not identical for the participant and each dependent.

SOURCE: Alexander Hamilton Institute, “Guide to HIPAA,” 1997.

Workforce Extra, November 1998, p. 1.