Iowa Employment Law Blog

Iowa Employment Law Blog

Alert and inform about legal issues, risks, and solutions relating to employees

Texas Court Grants Injunction Delaying the Department of Labor’s New Overtime Rules

Posted in Human Resources Compliance, Labor, Wage and Hour

On November 22, the U.S. District Court for the Eastern District of Texas issued a preliminary injunction prohibiting the Department of Labor from implementing and enforcing the new overtime rule as scheduled on December 1, 2016.

The new rule more than doubled the minimum salary an employee needed to qualify as exempt from overtime under the so-called “white collar” or EAP exemptions (Executive, Administrative, Professional).    The existing minimum salary is $413 per week ($23,460 per year); the new rule increased the minimum to $913 per week ($47,476 per year).    Employers have been scrambling in recent weeks to decide how best to comply with the new rule: whether to increase exempt employees’ salaries to the new minimum or reclassify formerly exempt employees and pay overtime for hours worked over forty per week.    Two lawsuits were filed September 20 challenging the rule but few expected the court to actually stop the rule from going into effect.

What are the practical effects of this ruling?   Most importantly, employers do not have to give raises or re-classify your employees by December 1.   Unfortunately, for many it may be too late.   Some employers have already communicated raises or re-classifications to employees.   There is nothing in the law that prevents those changes from being reversed, but it is difficult to take back what has just been given.

For employers who have not communicated or implemented the changes, the court’s injunction provides some immediate relief.  But, there is still quite a bit of uncertainty about what will happen next.    The future of the overtime rule will be impacted not just by legal but also by political considerations.

On the legal side, it is important to remember this is a preliminary injunction.  That means the court has not entered a final ruling, and it possible (although doubtful) in the end the court will allow the rule to go into effect.     It’s also likely the DOL will appeal this ruling to the U.S. Court of Appeals for the Fifth Circuit, which could result in the decision being reversed.     Neither of those outcomes is likely to occur for many months.   But, if the injunction is dissolved and the rule goes into effect, a thorny question arises: does the preliminary injunction preclude liability under the new rule between December 1, 2016 and the date the injunction is dissolved?   Common sense tells you an employer would not be liable, but that might not prevent employee lawsuits claiming they are entitled to either unpaid overtime or additional salary.

The election of Donald Trump along with a Republican controlled Congress may result in the political branches pulling the plug on the new rule.   That could occur in several ways, some of which take longer than others.    Congress could pass and the president could sign a law repealing the new rule.    The president could direct the Department of Labor to drop an appeal of the injunction and simply let the injunction remain in place.    Finally, the DOL under a new administration could issue rule repealing the new overtime rule.    The first two actions could occur fairly soon after January 20, 2017, while the third is a much longer and more difficult process.

We will continue to monitor the rule and keep you posted.

Employers Using Mandatory Post-Accident Drug Testing Should Reconsider the Practice in Light of OSHA Rule

Posted in Human Resources Compliance, OSHA

Iowa law has fairly strict limits on an employer’s right to conduct drug and alcohol testing.  One area in which testing is allowed, however, is when there is a workplace accident.  An employer may require an employee to undergo post-accident drug or alcohol testing if the employee is injured and requires medical treatment, or if there is property damage over $1,000.

Many Iowa employers have concluded mandatory post-accident drug and alcohol testing improves workplace safety.  It may deter employees from using illegal drugs or alcohol in the first place if they know an accident will be followed by a mandatory drug screen.   Employers have to give notice to their employees of this practice, so it should not be a surprise to employees.  A positive drug test also allows an employer in many circumstances to impose discipline or terminate an employee who presents a safety risk because of drug or alcohol use.   Lastly, if a drug or alcohol test reveals the employee was intoxicated, it provides a defense to the payment of workers’ compensation benefits if the intoxication was a substantial factor causing the injury.1999_219_safety-zone

But, Iowa employers that use mandatory post-accident drug testing should take note of November 1, 2016.    That is the date a new OSHA rule concerning post-accident drug testing takes effect.   Contrary to the rationale underlying Iowa’s drug testing law, OSHA contends such testing actually makes the workplace less safe because it deters employees from reporting workplace injuries or illnesses.   While the new rule does not contain a blanket prohibition against post-accident testing, an employer who uses drug testing or the threat of testing as a form of retaliation is subject to an OSHA citation and fine.   Adding insult to injury, OSHA has increased its fines by 78%.   The fine for a first serious citation will be in the range of $7,000-$12,740.   Deliberate or willful violations could result in fines up to $70,000-127,400.

So, how does OSHA decide if your mandatory drug testing procedure has a retaliatory motive?

Testing required by state or federal law or regulation is safe (such as the federal motor carrier safety rules).  OSHA has declared in advance that such programs are not implemented with retaliation in mind.

On the other hand, mandatory testing for every accident that causes serious injury or property damage is not safe from scrutiny for retaliatory motive.   The agency is likely to approve of post-accident drug testing only if it is done in specific, narrow circumstances.  For example, the Agency comments to the final rule state such testing should be limited “to situations in which employee drug use is likely to have contributed to the incident, and for which the drug test can accurately identify impairment caused by drug use.”

What are the practical implications of this new rule?  For one, to avoid conflicts with OSHA, employers should no longer rely on blanket policies allowing post-accident testing.  Each and every decision to test will have to be justified based upon the facts of the particular accident.  As a practical matter, only if an employer has reasonable suspicion of impairment based upon the employee’s behavior or the circumstances of the accident should testing be used.  Unfortunately, it is very difficult for employers to make such judgments, particularly under the threat of an OSHA citation and fine if you are wrong.

It is also important to remember that a positive drug test, in and of itself, is not necessarily evidence the employee was impaired.   Taking adverse action based upon a positive screen, absent other evidence of impairment, exposes the employer to a higher risk of citations and fines.

The new OSHA rules are one more example of a federal agency imposing its view on states that have already developed balanced approaches for dealing with workplace safety.   It is hard to conceive how restricting post-accident drug testing will improve workplaces for Iowa employe

What Does the Fox News Settlement with Gretchen Carlson Mean for Ordinary Employers?

Posted in harassment, Human Resources Compliance, Sex Discrimination, Title VII

The headline was Fox News agreed to pay $20 million to its former anchor Gretchen Carlson to settle a sexual harassment lawsuit against its former CEO Roger Ailes.   This is an extraordinary settlement, and not just because of the amount.   Fox News agreed to a public settlement (usually they are confidential); publicly apologized to Ms. Carlson (usually the employer denies the settlement is an admission of liability); agreed to pay only two months after the suit was filed; and paid even though Fox News itself was not a defendant in the case (Ms. Carlson sued only Ailes personally).

Ailes adamantly denied the allegations when the lawsuit was filed, and still maintains his innocence.   But, in forcing Ailes out as CEO, followed by a settlement of this magnitude, Fox News is essentially admitting Ms. Carlson’s allegations about the culture of sexual harassment and retaliation at the network were true.1

As is often the case with big money settlements in high profile cases, there has been lots of commentary about its broader significance.  One prominent employment law blogger opined the settlement heralds a new era of sexual harassment claims, as aggrieved employees will expect big money for their claims as well.   Others are concerned Fox’s admission it had a problem in its workplace culture is evidence that sexual harassment remains pervasive despite years of awareness and anti-harassment training.

I’m not convinced the Fox News settlement is so consequential, at least for most employers.   The facts that make this case so noteworthy are unique–a former Miss American turned news anchor against a media icon who ran a right leaning and popular news network.

Nonetheless, there is a lesson here that is not necessarily new, but bears reminding.   That is, clear policies, effective procedures, and regular training are important to prevent harassment and protect the company from claims.  But, they make no difference if not followed when the alleged perpetrator is powerful, popular, or influential in the organization.   A common temptation for other managers and even boards of directors is to look the other way, deny, or cover it up when a figure like Ailes is accused of sexual harassment or other misconduct.   Since the Carlson lawsuit was filed, two former employees disclosed they received six and seven figure settlements years before from Fox for sexual harassment claims allegedly involving Ailes.   Yet, he continued as CEO apparently without consequence.   Even if Ailes could be given the benefit of the doubt after one such claim, two (and perhaps more) should have raised red flags there was a ticking time bomb in the CEO’s office.

Contrast the Ailes case with Hewlett Packard’s quick ouster of its prominent CEO after an investigation revealed he had engaged in an inappropriate relationship with an outside contractor.    HP’s stock fell over 8% the day after, but in the end the company maintained its integrity.   Whether Fox News can do so remains to be seen.

Image Credits: from Shutterstock, Creative Commons license, Young Business Woman Counting Money

Court of Appeals Ruling a Reminder that the Duties Test Still Matters for Supervisors

Posted in Eighth Circuit, Wage and Hour

There remains a surprising number of employers who believe an employee with the title of “supervisor” who is paid a fixed salary is exempt from the federal overtime requirements. While such an employee may be exempt, it is not because of the title, and the salary is only one of the components (assuming the salary exceeds the minimum threshold). To be exempt, the “supervisor” must also satisfy one of the so-called “white-collar” exemptions by performing duties that qualify as “executive”, “administrative”, or “professional.”

A recent ruling from the Eighth Circuit (Garrison v. Con Agra Packaged foods, LLC) addressed whether ten employees who worked in a ConAgra plant as “team leaders” were exempt from overtime under the “executive” exemption. The team leaders claimed they were entitled to overtime when they worked more than forty hours a week.  At the plant in question, a team leader was responsible for, among other things, monitoring the performance and behavior of hourly employees, and identifying rules violations and poor work performance. They had authority to reassign or recommend temporary reassignment of employees and to recommend discipline. If management agreed to the recommended discipline, it would result in a change in status of the employee.images

To qualify under the “executive” exemption, an employee must meet four criteria:

1) compensation at or greater than $455 per week (increasing to $913 per week on December 1);
2) the primary duty is management of the enterprise or a customarily recognized department or subdivision of the enterprise;
3) customarily and regularly direct the work of two or more other employees; and
4) have the authority to hire or fire, or whose suggestions and recommendations as to the hiring, firing, advancement, promotion, or any other change of status of other employees are given particular weight.

ConAgra and the employees agreed the team leaders satisfied the first three criteria. The dispute was whether they met the fourth. To determine whether the team leaders’ suggestions and recommendations were given particular weigh in personnel decisions, the court examined whether their input into personnel decisions had more influence that the input provided by hourly employees.

The evidence showed the team leaders were told to appraise performance of probationary employees and report good or poor performance to a manager. At least two of the team leaders in the class had recommended the discharge of a probationary employee who was ultimately discharged. Team leaders also gave feedback whether promoted employees could do their new job, and if not the employees were demoted to their former positions. Team leaders were able to fill tempoary vacancies by moving someone from one class to another and managing the scheduling of hourly employees within their areas. Finally, the evidence show management followed the recommendations of team leaders with respect to employee discipline “most, if not all of the time.” The Court of Appeals found this evidence was sufficient to prove, as a matter of law, that team leaders in that plant were exempt from the overtime requirements.

If a front line supervisor is classified as exempt, the ConAgra case shows that reliable evidence the supervisor’s recommendations are actually followed is important. The best practice would be to document their input and show that management actually followed it.

images Credit: from Google images, Creative Commons license, Industrial Plant

Does Polk County Have the Legal Right to Iowa Impose a Higher Minimum Wage?

Posted in Human Resources Compliance, Labor, Wage and Hour

The minimum wage has been in the news a lot lately.   Here in central Iowa, the Polk County Board of Supervisors appointed a task force to study whether to raise the minimum wage in the County over and above the federal and state law minimum wage of $7.25 per hour.   Now the task force has come back with a recommendation that Polk County increase the minimum wage to $10.75 per hour in a series of incremental steps over three years.  The proposal is to raise the minimum wage to $8.75 on April 1, 2017, followed by $1 increases on January 1, 2018 and 2019, to a total of $10.75.

While the political momentum seems to favor an increase in the Polk County minimum wage, some have raised the question whether a County in Iowa has the legal right to impose a minimum wage higher than the wage state or federal law requires.

Like many legal questions, the answer is, “it depends.”  Iowa law gives counties the power of what is known as “home rule”.  So long as a county ordinance does not conflict with the requirements of a state law, a county is free to legislate as it deems appropriate for the welfare of its citizens.  Home rule includes the right to set standards and requirements higher or more stringent that those imposed by state law, unless the state law provides otherwise.   On the surface, therefore, it seems there is nothing that would prevent a county from raising its minimum wage above the state mandated minimum.

But, looking below the surface, there could be problems.  For example, Iowa law permits tipped employees to be paid up to 40% less than state mandated minimum wage.    If Polk County were to raise the minimum without an exception for tipped employees, it would conflict with the state law, and subject it to a potential legal challenge.  In addition, Iowa law gives cities virtually the same home rule authority has counties.   Therefore, a city within Polk County could effectively opt out of the county imposed higher minimum wage by enacting its own wage ordinance.    Nor does the proposed wage increase address the practical problem of cities located in more than one county, such as West Des Moines.

Central Iowa employers will be watching this debate closely.

Is Time Off Work A Reasonable Accommodation?

Posted in Disability Discrimination, FMLA, Human Resources Compliance, Uncategorized

Most of us think about workplace accommodations as modifications that will allow an employee with a disability to perform his job.  Without the accommodation, doing the job may be difficult or impossible. Whether that means modifying the job duties, changing the schedule, or providing an assistive device, the ultimate objective is to help the employee to work.

But, an employer’s obligation to reasonably accommodate may not be limited to modifications that will help the employee work.  Sometimes, the required accommodation is to allow an employee not to work, while still keeping his job.

That is the message of a recently published EEOC guidance on an employer’s obligation to provide leave under the ADA.  While this may seem counter-intuitive, the obligation to provide leave as a reasonable accommodation is not really new.   But, with this recent publication EEOC appears to be sending the message that these types of claims will get priority treatment.

The following are some practical compliance and risk management tips to avoid getting in EEOC’s cross-hairs because of your leave practices and policies:

  • If you don’t offer leave as a benefit (or if employees must work a certain amount of time before becoming entitled to leave), you still must consider leave as a potential accommodation to a disability.
  • If an employee has exhausted available leave (such as FMLA), you may be obligated to provide additional leave as a reasonable accommodation.
  • You should not allow maximum or no fault leave policies to be applied without communicating with the employee and possibly considering exceptions to the policy for someone who many need additional leave as a reasonable accommodation.   Get rid of the “form” letters that are automatically sent to the employee nearing the end of the leave period.  These letters typically tell the employee to return to work by a date certain or they will be terminated.   This is a big red flag.
  • Just as with any other proposed accommodation, the interactive process is very important.   Employers should have procedures in place to both engage in the interactive process, document that it occurred, and what was the discussion.

The most important question, and the hardest to answer, is how much leave do you have to give an employee to accommodate a disability before it becomes unreasonable?  While each situation must be evaluated on a case-by-case basis (of course!), the following rules are generally applicable:

  • The employee must be allowed to exhaust legally mandated leave (e.g., FMLA).
  • The employee should be allowed to exhaust available paid leave.
  • Typically, it is not reasonable to require additional leave for a long time.  Of course, what is “long time” for one employer may not be for another.   If the employee has already been gone for twelve weeks on FMLA, it probably would not be an undue hardship to allow a couple more weeks.  A lot depends upon what needs to be done to cover for the absent employee.
  • Typically, it is not reasonable to grant additional leave for an uncertain, unknown period of time.  If a physician provides a date certain the employee can return to work, and it’s not too far in the future (see above), then it probably is reasonable to accommodate.
  • Precedent is important.   If you allowed a similar employee an additional 30 days of leave last year, you should treat this year’s request similarly.

 

What Makes for a Good Employee Lawsuit

Posted in Human Resources Compliance, Litigation and Trials

Management side lawyers are constantly giving  advice about “how to” or “how not to” handle various employment situations.   But, sometimes the best insight about what is or is not a good practice comes from the plaintiff’s side.   After all, they are the ones who sue our clients, and we should pay attention whenever a plaintiff’s lawyer tells us candidly what makes for a good employment lawsuit.

The following are a few quotes from a presentation attorney Randy Freking gave at a Labor and Employment Advanced Practices Symposium, followed by my own observations in bold:Lawyer

Freking: “Performance reviews are dangerous things. I always tell employers to not do employee reviews unless you’re going to do them honestly. They’re wonderful documents for plaintiff lawyers.”

I agree with Mr. Freking on this one.    When my client tells me they fired an employee for poor performance, only occasionally do the performance reviews back them up.   The fact is, most managers and supervisors are not candid with employees who need to do better.  Although it is difficult to give bad reviews, not putting an employee on notice of bad performance will cost you later.

Freking; “With every new potential client, I ask if they received a warning before being terminated. As soon as I hear ‘yes,’ it does slow us down in the march toward litigation.”

Many employers think that because Iowa is an at-will state, there is no legal requirement to give warnings.   While that is technically true, at will employment has for all practical purposes become a myth.    The reality is, almost all employee handbooks have progressive discipline, and most juries think it should be followed.  The only exception might be if the employee does something really egregious, and you can prove the employee actually knew it was egregious and might result in a discharge.  Serious safety related violations may qualify, especially if someone else is injured.   So does theft or some serious dishonesty.  But not too much else.

Freking: “Juries expect some level of progressive discipline—they think it should be required.”

See above.

Freking: “For a plaintiff’s lawyer, email stands for ‘evidence mail.'”

As we all know,  e-mail has become the most common way people communicate with each other in the workplace.    No matter how much managers are cautioned about how they use it,  the reality is most continue to treat e-mail like it is a conversation instead of a written communication.    People forget that e-mail does not go awayand those internal censors that are typically used in written communication are sometimes turned off when it comes to e-mail.  

Freking: “People don’t run to attorneys because they think they’ve got a great legal case. They come to see me because they’re angry about the way they were treated, especially on their way out.”

Few things are more difficult that terminating employees, even those who deserve termination.    To try and make the conversation easier, sometimes we say too much, try to be funny, or simply don’t think enough ahead of time about what to say.    For example common statements like the following really have no place in a termination:   “I understand how you feel”;  “this is as hard for me as it is for you”; or “this decision is for the best interests of you and the company”.

Freking: “Respond to the lawyer’s letter. You’ve got to tell your side of the story. It’s your opportunity to talk the plaintiff’s lawyer out of the lawsuit. If I get blown off, I’ll proceed with the case.”

This is a good idea, but please get counsel involved at this point.   Don’t assume the lawyer will be dissuaded from filing a if you simply tell them what the real facts are.  Don’t assume this employee will never sue, that the court will dismiss it right away, or it will be obvious to anyone that you are on the right side.

Iowa Employers Should Re-Examine Policies on Pregnancy Accommodation

Posted in Human Resources Compliance, Litigation and Trials, Sex Discrimination, U.S. Supreme Court

How to best accommodate pregnant employees is a frequent challenge Iowa employers face.    Pregnant employees may be entitled to protection under the laws prohibiting discrimination on the basis of pregnancy, as well as those requiring equal treatment based upon gender and disability.  Many employers have tried to walk this fine line with policies that allow for accommodation of a temporary disability only if it is the result of an on-the-job injury.   For non-worked related temporary disabilities (which pregnancy presumably is almost all the time), no accommodation is offered.

The theory behind such policies is that it treats similarly situated employees equally, regardless of gender or the nature of the temporary disability.   The distinction is drawn between work and non-work causes of the temporary disability.   The rationale for treating on-the-job injuries differently is that the workers’ compensation law provides an incentive to return injured workers to work as soon as possible, indexso as to avoid paying benefits for temporary total disability.

Until about the last year or so, this was a workable policy for an employer to have.   But, two cases decided last year, one by the U.S. Supreme Court (Young v. UPS)  and one by the Iowa Supreme Court (McQuistion v. City of Clinton) should cause employers to re-visit and possibly change their policies governing temporary disabilities and pregnancy accommodations.

Both cases dealt with employer policies of the type described here.  That is, accommodation was provided for some temporary disabilities, but not others, pregnancy being within those that were not subject to accommodation.   Although the U.S. Supreme Court addressed federal law and the Iowa Supreme Court Iowa law, the practical result from both opinions is the same:  this type of policy is presumed to violate the law against pregnancy discrimination.   The employer can overcome this presumption if it can show the legitimate reason underlying the policy is sufficiently strong to justify the burden it places on pregnant employees.   But, if the practical effect of the employer’s policy is to accommodate a large percentage of non-pregnant while a large percentage on pregnant employees are not accommodated, it will be difficult for the employer to carry its burden.    In the end, a jury will get to decide whether your policy is justified or creates an unreasonable burden.

The best way to avoid litigation is to change the policy that automatically results in pregnancy not being accommodated.   Each and every condition that results in a disability should be evaluated on its own merits to determine whether it can be accommodated.   While this may create more burdens for the employer each time you have to address a pregnancy related request for accommodation, it is more likely to keep you from being sued.

 

Caution: Just Because You Give an Employee What He Wants Does Not Mean He Won’t Sue You For It Later

Posted in Litigation and Trials, Race Discrimination, Title VII

Employment discrimination lawsuits are filed because something bad happened to an employee that the employee did not want. Usually it’s a termination, a demotion, or discipline. Sometimes it’s harassment. Other times a refusal or failure to hire or promote. It’s always something adverse. That’s why they are called “adverse employment actions”.

So, what happens in an employee applies for a transfer to a new position within the organization   He thinks it will be better for his career. Someone else gets the job, but that person doesn’t work out. Employee gets another opportunity and is moved into the new position.   Unfortunately, the employee is not well suited for job, and ultimately gets terminated.   Now he claims the employer discriminated against him by transferring him to the new position.    He can’t sue can he? He asked for the transfer.   

A recent ruling from the Sixth Circuit seems to stand the whole idea of “adverse employment action” on its head. In Deleon v. Kalamazoo County Road Commission (6th Circuit, January 14, 2014) the Court held a lateral transfer from one department to another qualifies as an adverse employment action, even though the Plaintiff had applied for the job nine months previously.

The Plaintiff, a 53 year old Hispanic male of Mexican descent, was employed by the Kalamazoo County Road Commission. For 13 years he served as an area superintendent, which involved supervising road maintenance activities, road crews, and overseeing repairs.

In 2008, a vacancy arose for the position of Equipment and Facilities Superintendent. Plaintiff applied for the position because he anticipated it would result in a pay increase and would be better for his career and advancement.    He was not offered the job, primarily because of his deficient computer skills. But, the person who took the job left shortly thereafter, and an external candidate offered the position declined it. Thus, nine months after Plaintiff had applied, the job was again open, and he was transferred there. 

Unfortunately for Plaintiff, the deficient computer skills that kept him from getting the job in the first place proved to be his undoing. Plaintiff’s first evaluation in the new position rated him acceptable in most critical areas but he was deficient in technology. He complained that he was unhappy with his new position.   He did not like the fact that the working condition exposed him to loud noises and diesel fumes.   Plaintiff inquired why he had been involuntarily moved from a position where he was performing well to one that was more hazardous. Plaintiff was later hospitalized for what he attributed to work induced stress and eventual mental breakdown. He took eight months of leave under FMLA because of his mental breakdown. By the time he was released to return to work, his employment had been terminated. Plaintiff alleged the transfer was a deliberate attempt to set him up to fail because of his race, national origin, and age.

The trial Court granted Defendant’s Motion for Summary Judgment on the basis that Plaintiff did not suffer an adverse employment action. The Court of Appeals reversed, but with one judge dissenting.    In evaluating whether the transfer was an adverse employment action, the majority discounted the fact that Plaintiff had previously sought the job, concluding that the conditions at the time the transfer actually occurred made it involuntary.   The majority pointed to the fact that Plaintiff did not receive the raise he expected, and was not satisfied with the more hazardous working conditions.   The test, according to the majority, was not whether the employee requested or did not request the transfer, but whether the conditions of the transfer would have been objectively intolerable to a reasonable person.

The dissenting judge disagreed that Plaintiff’s transfer could be considered an involuntary one.   According to the dissent, giving an employee what he wanted, and in what he persisted in seeking when at first he did not succeed, cannot an adverse employment action.  

Unfortunately, rulings like this one contribute to employer cynicism about the employment discrimination laws and tend to undermine what the law seeks to accomplish.   The dissent pointed out this perverse result, noting that an interpretation of the law “that subjects employers to liability coming and going—whether after granting employee requests or denying them-will do more to breed confusion about the law than to advance the goals of a fair and respectful workplace.”     

Another Court Rules Agreement to Arbitrate Employment Disputes is Enforceable

Posted in Litigation and Trials

Employers who want to bypass jury trials of employment disputes in favor of arbitration got another boost in a recent case from the Eastern District of Missouri. In Karzon v. AT&T, Inc. (E.D. Mo. 1/7/14), the court ruled that E-mail notification of an arbitration proposal combined with an “opt-put” option was sufficient to bind employees to the company’s arbitration agreement.   The plaintiff sued AT&T, alleging he was subject to a hostile work environment, unequal discipline, and was unlawfully terminated based upon his national origin. AT&T asked the court to dismiss the lawsuit and order the parties to submit the case to arbitration. In late 2011, AT&T offered its employees the opportunity to arbitrate any employment disputes with the company.   The plaintiff argued he was not required to arbitrate because he never agreed to the arbitration offer. AT&T notified employees by e-mail it had implemented an arbitration program to resolve disputes between the AT&T Companies and their employees. The e-mail included a link to a web page containing the text of the arbitration agreement. AT&T’s records showed the plaintiff received the e-mail and accessed the associated web page through the link on the same day. The e-mail to employees stated in bold print “REVIEW REQUIRED” and “Notice Regarding Arbitration Agreement”. The notification told employees they had the option whether to participate in the arbitration program. The program also gave the employees the option whether or not to participate. However, in order not to participate in mandatory arbitration, the employee had to “opt out” using the instructions and website. If the employee did not opt out, the company presumed the employee agreed to arbitration. The Federal Arbitration Act (FAA) makes arbitration agreements enforceable just as any other contract. Although it has been extensively litigated, courts have held in recent years that even employment agreements containing arbitration provisions are enforceable. The only way an employee can get out of an arbitration provision is by showing the agreement is not enforceable for some other reason.  In Karzon, plaintiff claimed the arbitration agreement AT&T presented to its employees was not enforceable because it was not in writing. The court rejected that argument, finding the e-mail communication was sufficient to qualify as a writing. The plaintiff also argued no contract was formed because he never accepted the agreement. The court ruled, however, that under Missouri law an offer may be accepted by conduct, which includes failing to opt out of the agreement as was the case here. While agreements to arbitrate employment disputes are not common in Iowa, this case nonetheless is a reminder that such an option is available for employers who want to avoid jury trials. To make an arbitration agreement enforceable, however, employers should ensure employees have fair notice and a real opportunity to agree or not agree. . That was accomplished in the Karzon case by making participation in arbitration optional and not mandatory. The second important consideration is making sure the employee consents to be bound by the arbitration agreement. In the Karzon case it was enough for the court that the plaintiff failed to opt out of participation. While some states will require stricter evidence of consent to participate, this case shows that an opt out provision may be a viable alternative. Of course, whether arbitration is a better option for employers than litigating in court is another question altogether.     That is a subject for another day.