Iowa Employment Law Blog : Iowa Employment Lawyer & Attorney : Patrick Smith : Bradshaw Fowler Proctor & Fairgrave Law Firm : Des Moines, Central IA Discrimination & Labor Law

The biggest news this week is the EEOC's release of the proposed regulations for the ADA Amendments Act of 2009.   This post from Jackson Lewis provides some of the highlights.   Note that these are proposed regulations.  There is a 60 day period during which the EEOC will receive comments.  After considering the comments, the EEOC will publish the final regulations and the date the regulations will become effective.   Stay tuned for more information and analysis.

Pop quiz: how many new federal employment laws have been passed by the 111th Congress in 2009 and signed into the law by the President?  Answer: one (the Lilly Ledbetter Fair Pay Act signed into law January 29, 2009). 

With all the buzz in the employment law community about the anticipated changes in 2009, some may be surprised by that answer. Employers should not rest on their laurels, however, because there are plenty of bills in the pipeline.   In this post, Dennis Westlind of World of Work blog identifies thirteen employment related bills that were introduced in 2009 and remain pending, including the Employee Free Choice Act (permitting union recognition by "card check", among other things;  Employment Non-Discrimination Act (prohibiting discrimination on the basis of sexual orientation or gender identity); Paid Vacation Act (mandating employers with 50 or more employees to provide paid vacation), and Paycheck Fairness Act (providing for "enhanced enforcement" of equal pay requirements between male and female employees).

Unpaid internships illegal?  In this post, Dallas Mavericks owner Mark Cuban rails against the Federal Wage and Hour Regulations that make the traditional "foot in the door" experience unlawful.  

Is there a looming crisis with wage and hour litigation?  Dan Schwartz at Connecticut Employment Law Blog and Jon Hyman at Ohio Employer's Law Blog show that, despite the buzz about wage and hour suits, the actual number of federal labor cases filed in their jurisdictions has remained steady.    The real concern is that many of these cases are collective actions, which can result in substantial monetary liability.   In May 2009, local convenience store chain Casey's General Stores paid over $11 million to settle two wage and hour collective actions filed by 7,600 former management level employees and 76,000 non-management employees.

Finally, according to the U.S. Department of Justice, the federal government has the right to read even the personal e-mail of its employees.    Notes one commenter on the ABA Journal site: "At least somebody is reading the emails I send to federal government employees…."

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Employee Availability After Hours Comes at a Price

The Wall Street Journal reports on a potential boom in lawsuits relating to unpaid overtime.  The culprit--company issued smart phones combined with lean workforces requiring fewer employees who handle more responsibility.   With new technology, employees are capable, and often expected, to handle work related communication anytime and anywhere, whether they are off the clock, sick, or on vacation.   The article reports on two recently filed lawsuits claiming unpaid overtime under the Fair Labor Standards Act (FLSA) .  In one case, retail employees of T-Mobile USA claim they were required to use company issued smart phones to respond to messages and customer complaints after hours.  In the second case, a maintenance employee for CB Richard Ellis alleges he was not paid for after hours time spent sending and receiving messages on his cell phone.

Under the FLSA, whether an employee is who is required to carry an employer issued mobile phone, pager, or smart phone after hours remains on the clock depends upon many factors, including the nature of the job and how frequently the employee actually has to use the device for work related purposes.   Depending upon the number of employees involved, failure to comply with FLSA's overtime requirements can result in substantial financial liability.  To avoid running afoul of these overtime requirements, prudent employers are urged to develop clear practices concerning employee's use of company issued technology.

Company Officers May Be Held Personally Liable for Unpaid Wages

A bankrupt company does not necessarily relieve corporate officers of liability for unpaid wages under FLSA.  So held the U.S. Court of Appeals for the Ninth Circuit in Boucher v. Shaw, decided on July 27, 2009.   In Boucher, a group of former employees of the bankrupt Castaways Hotel, Casino, and Bowling Center in Las Vegas sued the CEO, Chief Financial Officer, and manager in charge of labor relations, claiming the individual officers and managers were liable for their unpaid wages.  Rather than getting in line with other creditors in the bankruptcy proceedings, the plaintiffs decided to pursue the officers individually.

The Court noted that the definition of "employer" under FLSA is not limited by the common law understanding of the term, but "is to be given an expansive interpretation in order to effect FLSA's broad remedial purposes".    The test, according to the Court, is whether the individual exercises "control over the nature and structure of the employment relationship", or "economic control" over the relationship.   In this case, the Court noted that the CEO held 70% of the company shares, the manager in charge of labor relations owned 30%, and the CFO had responsibility for cash management.  Under these facts, the Court held the plaintiff's stated a claim against the individuals under FLSA.   The Court rejected the defendants' argument that any claims for unpaid wages by former employees belonged in the bankruptcy court. 

While there is no similar precedent in the Eighth Circuit, the Boucher case nonetheless should put company officials on notice that wage claims may exist against them individually, even after the corporation is bankrupt or otherwise defunct. 

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Employers should take note of a recent EEOC publication entitled "Employer Best Practices for Workers with Caregiving Responsibilities", available on the EEOC website, or by clicking here.   

Although an employee's status as a caregiver is not protected under any federal or Iowa law, the EEOC nonetheless takes the position that discrimination against such employees can constitute discrimination on the basis of characteristics that are legally protected, such as sex or disability.   EEOC "Best Practices" documents do not carry the force of law, but are intended to provide suggestions for practices that employers may adopt to reduce the chance of EEO violations against caregivers, and to remove barriers to equal employment opportunity.  Best practices are proactive measures that go beyond federal non-discrimination requirements.    As courts often defer to the EEOC's interpretation of the discrimination laws, employers should familiarize themselves with some of the EEOC's suggestions.

The EEOC recommends that employers develop, disseminate, and enforce a strong EEO policy that clearly addresses the types of conduct that might constitute unlawful discrimination against caregivers based on characteristics protected by federal anti-discrimination laws.   The document states that an "effective" policy should include, among other things, the following:

• Definitions of relevant terms, including “caregiver” and “caregiving responsibilities.
  • Provide an inclusive definition of “family” that extends beyond children and spouses and covers any individual for whom the applicant or employee has primary caretaking responsibilities.
• Describe common stereotypes or biases about caregivers that may result in unlawful conduct, including:
  • assuming that female workers’ caretaking responsibilities will interfere with their ability to succeed in a fast-paced environment;
  • assuming that female workers who work part-time or take advantage of flexible work arrangements are less committed to their jobs than full-time employees;
  • assuming that male workers do not, or should not, have significant caregiving responsibilities;
  • assuming that female workers prefer, or should prefer, to spend time with their families rather than time at work;
  • assuming that female workers who are caregivers are less capable than other workers; and
  • assuming that pregnant workers are less reliable than other workers.
  •  
• Provide examples of prohibited conduct related to workers’ caregiving responsibilities, such as:
  • asking female applicants and employees, but not male applicants and employees, about their child care responsibilities;
  • making stereotypical comments about pregnant workers or female caregivers;
  • treating female workers without caregiving responsibilities more favorably than female caregivers;
  • steering women with caregiving responsibilities to less prestigious or lower-paid positions;
  • treating women of color who have caregiving responsibilities differently than other workers with caregiving responsibilities due to gender, race and/or national origin-based stereotypes;
  • treating male workers with caregiving responsibilities more, or less, favorably than female workers with caregiving responsibilities;
  • denying male workers’, but not female workers’, requests for leave related to caregiving responsibilities; and
  • providing reasonable accommodations for temporary medical conditions but not for pregnancy.

 Proactive employers would do well to review their policies to take into consideration potential discrimination claims by employees with caregiver responsibilities.

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Just days after the Iowa Supreme Court's ruling legalizing same sex marriage, at least one media outlet is reporting that Iowa employers are scrambling to determine whether they need to adjust their employment policies to comply with the ruling.  Of immediate concern are employee benefit programs that provide coverage for spouses, and policies governing family and medical leave.

An employee in Iowa is already protected from discrimination based upon sexual orientation or gender identity.  However, that protection did not necessarily require an employer to extend benefits to a same sex partner in the same way it would the spouse of a married employee.   The new ruling could change that requirement.  To the extent an employer grants benefits to the spouse of an employee, spouse may now include a person of the same sex.   It is important to note, however, that many employee benefits are governed by federal law, which is not necessarily impacted by the Iowa Court's ruling.

Employers should also adjust their practices concerning Family and Medical Leave Act compliance.   An covered employee under FMLA has the right to job protected leave to care for a "spouse" with a serious health condition.    FMLA itself defines "spouse" as "a husband or wife as the case may be".  However, the Department of Labor Regulations interpreting FMLA look to the law of the state where the employee resides to determine whether a person is a "spouse." 

Employers are advised to consult with counsel and with their employee benefit provider when adjusting policies and practices to comply with the Court's ruling.

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