On March 14, the Department of Labor issued an opinion letter to answer the following two questions about FMLA leave:  1) may an employer delay designating leave as FMLA covered, even if the leave is for a FMLA qualifying reason, to allow the employee to exhaust paid leave first;   2) may an employer expand an employee’s FMLA leave beyond the statutory 12 week entitlement.    In the DOL’s opinion, the answer to both questions is “no.”

The situation the opinion letter addresses is quite common: an employee wants to use available paid leave before starting the clock ticking on the 12 weeks of FMLA leave. By delaying the designation of the leave as FMLA covered until after the paid leave is exhausted, the employer has effectively granted the employee additional weeks of protected leave.

I have always thought the FMLA regulations on this point are fairly clear: the employer is required to designate FMLA qualifying leave as covered by FMLA; to the extent an employee has accrued paid time off, the employer can require it to run concurrently with FMLA. This rule is a great benefit to employers in managing employee leave by ensuring that the FMLA job protected leave lasts no longer than 12 weeks, regardless of how much paid time off the employee has accrued.

Despite the seeming clarity of the regulation, the DOL issued two prior opinion letters (in 1995 and 1996), that took the position that an employer had the right, but was not required, to designate FMLA qualifying leave as FMLA covered (so long as it did not deny employees their rights under FMLA).   The Department reasoned that this permissive approach was consistent with FMLA’s provision that allows employers to extend more leave than FMLA requires.   However, in the March 14 letter, the DOL emphasized that the designation of FMLA qualifying leave as covered leave is mandatory, and the maximum number of weeks of FMLA leave to which an employee is entitled in a year is 12 (or 26 is the case of military caregiver leave).  An employer remains free to grant leave beyond the 12 week requirement, but it cannot be considered FMLA leave.    The March 14 letter expressly withdrew these prior opinion letters.

DOL may have taken a more permissive approach in the past because the practice of allowing an employee to use paid leave before starting the FMLA clock typically causes no harm to the employee.  In fact, it is usually a great benefit to the employee who gets the extra leave.   From that perspective, it’s difficult to discern what harm the Department is trying to remedy with this new opinion.

The answer may be a 2014 ruling on this subject from the Ninth Circuit, Escriba v. Foster Poultry Farms, Inc., 743 F.3d 1246, 1244 (9th Cir. 2014).    The plaintiff in that case, Maria Escriba, sought two weeks of leave to care for her ill father in Guatamala.    She informed her supervisors of the FMLA qualifying reason for the leave, but expressly requested the time be deemed as vacation leave, so she could save FMLA leave for future use.  When Escriba failed to return to work after two weeks, she was terminated.  Escriba filed suit, alleging her termination interfered with her FMLA rights.  She claimed, based upon the regulations, the employer was required to designate her leave as FMLA leave.  Escriba argued she was not allowed to waive her FMLA rights by electing to use vacation leave before FMLA leave commenced, despite the fact that is what she specifically requested.

On appeal, the Ninth Circuit rejected Escriba’s arguments, ruling that the two weeks of vacation leave she requested were not FMLA protected, even though she was on leave for an FMLA qualifying reason.   The court held that, “an employee can affirmatively decline to use FMLA leave, even if the underlying reason for seeking the leave would have invoked FMLA protection.”   Because Escriba’s two weeks of leave was not FMLA protected, the court concluded the employer did not interfere with her FMLA rights by terminating her employment.

Escriba was a win for that particular employer, but ironically was a loss for employers generally.    What was previously a employer granted discretionary benefit (allowing exhaustion of paid leave before starting the FMLA) was transformed into an employee right (entitlement to exhaust paid leave before starting FMLA).   Once the employee has the right to determine when the FMLA clock starts, the employee potentially gains the opportunity of extra leave beyond the 12 week statutory entitlement.   The employer’s ability to effectively manage FMLA leave, granted to it by regulation, was out the window.

The DOL specifically mentioned in footnote 3 of the March 14 letter its disagreement with the holding  Escriba.   While the Department’s opinion letter is not binding authority, courts often defer to the agency’s interpretation of the law.   Perhaps the Department issued this letter as part of an effort to confine to the Ninth Circuit the transformation of an employer managed benefit into an employee entitlement.

What is the takeaway for employers?   First, if you want to protect your prerogative to manage FMLA leave, then you need to exercise it by following the DOL’s guidance in the March 14 opinion letter; namely, you should always designate as FMLA covered leave any leave that is FMLA qualifying.   If the employee has available paid leave, the two can run concurrently.     If you want to be more generous,  make it clear that additional leave is available only after FMLA leave has been exhausted, and does not necessarily come with FMLA protected rights.   Second, it may help employers reinforce the rule to supervisors and HR personnel who may not recognize the employee does not have a choice in determining when the designation of FMLA covered leave occurs.    Finally, while there is no ironclad guarantee that other circuits will follow the DOL’s opinion letter, relying on a DOL Guidance supports an employer’s good faith defense it was trying to comply with the law, even if a court later finds the conduct to violate FMLA.

In a widely publicized move, the U.S. Department of Labor on March 7 proposed an update to the Fair Labor Standards Act (FLSA) regulations governing employees who are exempt from overtime.   The most significant change in the proposal is to raise the minimum salary an employee must earn to qualify as exempt from overtime.  The existing minimum salary is $455 per week; the new proposed minimum salary is $679 per week, a 49 percent increase.    An employee must also satisfy one of the “duties” tests to be exempt from overtime (e.g., executive, administrative, professional), but the proposed rule does not change any of those tests.

Most employers probably remember, with some chagrin, the DOL’s 2016 rule that more than doubled the salary basis to $913 per week.   Businesses were scrambling to adjust their job descriptions and payrolls in anticipation of the new rule’s  December 1, 2016 effective date.   Then, eight days before, on November 22, 2016, a district court in Texas issued a surprise nationwide injunction preventing it from going into effect.   For a refresher on the injunction and its aftermath, see our posts here, here, and here.

On August 21, 2017, the same federal judge, Amos Mazzant, issued a final ruling invalidating the $913 per week salary basis.   Surprising to some, the Department, now with a Trump appointed Secretary, appealed the judge’s final ruling to the U.S. Court of Appeals for the Fifth Circuit.   But, the Court of Appeals agreed to hold the appeal in abeyance while the DOL undertook further rulemaking to consider adjusting the salary basis to something lower than $913 per week in the 2016 Rule, but more than the $455 per week that was previously in effect (and remains in effect today).  Perhaps not coincidentally, the proposed $679 per week proposed salary basis is almost exactly in the middle of $455 and $913.

So, what happens next?   On the rulemaking side, the public will have 60 days to comment on the proposed rule.  The Department will then consider those comments, and issue a final rule, probably sometime in 2020.   More importantly though, what will happen if, as is likely, the DOL’s final rule maintains the $679 per week salary basis?    If challenged, is a court more likely to find a 49 percent increase is valid because it is less of an increase than in the 2016 rule?   Does the validity of the DOL’s rule depend upon something so arbitrary as a federal judge’s opinion about what persons in certain occupations should earn?

Many employers and business advocacy groups agree $455 is probably too low a salary basis given inflation that has occurred since it was established. They can probably also live with the proposed $679 per week (indeed, this salary level was chosen after considerable input from interested parties).   But, despite the DOL’s effort to appease all interested stakeholders, there is a good chance some interest group will file suit to challenge the new rule.   The issue is not so much the amount of the salary threshold, but whether the DOL has the right in the first place to use a minimum salary as part of the test to determine whether an employee is exempt from overtime.    Commenting on Judge Mazzant’s ruling on the Obama era rule, I said in a September 12, 2017 post:

In the ruling on the preliminary injunction, Judge Mazzant questioned whether the DOL has the legal authority to establish a salary basis test.   He reasoned the FLSA itself defines Executive, Administrative, and Professional exemptions only with respect to duties, and says nothing about the employee’s salary.  Therefore, he ruled, Congress did not intend that the amount of an employee’s salary be a factor in determining whether the employee was exempt; only the duties are relevant.   By including a salary basis test in addition to a duties test, Judge Mazzant concluded, at least preliminarily, that the DOL likely exceeded its statutory authority.

It is important to note that, in the final ruling, Judge Mazzant backed away from his initial opinion that questioned the DOL’s authority to use the salary test at all. Instead, he concluded merely that $913 per week too high because it likely would have the effect in many cases of eclipsing the duties test, essentially rendering the duties irrelevant.   In other words, the salary was so high that many employees who satisfied the duties test for one of the executive, administrative, or professional exemptions would still be classified as non-exempt because their salary was less than $913 per week.

In addition to questioning the legal basis for the minimum salary, there are practical reasons the salary basis test should be abandoned.   First, the salary basis applies to the entire country, and does not take into account regional and local economic conditions.   A $679 per week salary means something different in Des Moines than it does in San Francisco or New York.    Second, in the modern era the salary basis has become a political weapon used to benefit favored constituencies, depending upon the party in power.   Third, the proposed rule contains a provision that allows the Department to change the salary basis every three years.   But, the rulemaking process is so slow that it takes at least two years for a rule to get from the proposal to the final stage.  Moreover, once the new salary basis is in place, it could once again be subject to legal challenge.    Lawyers and lobbyists love this process, but whether it actually benefits ordinary employees is questionable.  Finally, lawyer and blogger Jon Hyman makes an excellent point that I have not seen elsewhere, but is important:  that is, the salary basis test simply does not matter.   If an employer pays someone less than $679 per week, that person is probably not the sort of employee who exercises the type of discretion and judgment required to satisfy the duties part of the test.  It is the duties test that employers should really be worried about.

So what’s the takeaway from all this?  Employers, get ready for the new salary basis in 2020, but don’t be surprised if it never goes into effect.

 


Claims of sexual harassment typically involve the behavior of fellow employees.   But, an employer’s potential liability for sexual harassment also extends to conduct by a non-employee, such as a customer, client, or patient, that creates a hostile work environment.

The principle of employer liability for harassment by a non-employee third-party presents particular challenges to the long term care industry.   The problem occurs when the harasser is a resident or patient with dementia or other diminished mental capacity.   Physical violence or sexually inappropriate is sometimes associated with Alzheimer’s or other forms of dementia.   In many cases, courts have recognized behavior that might qualify as sexual harassment in other contexts does not create a hostile work environment for care facility employees directly caring for such patients, because the employee should reasonably expect it to occur.  The unique circumstances involved in caring for dementia patients essentially makes tolerating at least a certain level of bad behavior part of the job.

However, a recent case from the Fifth Circuit (covering Texas, Louisiana, and Mississippi) shows that long term care employers do not always get the benefit of the doubt when it comes to a dementia patient’s alleged sexual harassment of a care center employee.   The case is Gardner v. CLC of Pascagoula, LLC, (5th Cir. 2-7-2019).  The plaintiff in Gardner was a Certified Nursing Assistant (CNA) at an assisted living facility.   She was experienced in working with mentally disabled patients, and was trained in de-escalation and defense tactics for aggressive patients.  Gardner often worked with patients who wither “either physically combative or sexually aggressive.”

The harasser was an elderly resident who lived at the facility for eight years.   Gardner worked with him for three of those years.  The resident had a reputation for groping female employees and becoming physically aggressive when reprimanded.   He was diagnosed with dementia, traumatic brain injury, personality disorder with aggressive behavior, and Parkinson’s Disease.   He was reported to have a “long history” of violent and sexual behavior toward both patients and staff.

Gardner alleged she experienced on a daily basis the resident physically grabbing her and repeatedly making sexual comments and requests.   She documented the resident’s behavior in his chart and routinely complained to supervisors about it. The resident was at one time transferred to a different wing of the facility because of his behavior, but the employer refused the Gardner’s request to be reassigned so she would not have to care for him.  When she attempted to discuss her concerns about the resident’s behavior with her supervisor, there was evidence Gardner’s supervisor laughed and told her to “put [her] big girl panties on and go back to work.”

The facility terminated Gardner after an incident that occurred while she was helping the resident in question attend a therapy session.   As Gardner was trying to help the resident out of bed, he tried to grope her, then punched and pushed her.  Although Gardner disputed it, the facility claimed she swung her fist over the resident’s head and her arm brushed the top of his head in the process.  As she left the resident’s room Gardner uttered an expletive about refusing to do anything else for the resident.  Gardner sustained serious enough injuries in the incident that she went to the ER and ended up missing three months of work. Shortly after returning from leave, the facility fired her for insubordination (refusing to work with the resident), attacking the resident, and violating his rights by swearing in front of him.

The trial court dismissed Gardner’s hostile work environment claims.  The court reasoned that the resident’s “harassing comments and attempts to grope and hit are [not] beyond what a person in Gardner’s position should expect of patients in a nursing home.”  However, the Court of Appeals reversed the grant of summary judgment, concluding that “the evidence of persistent and often physical harassment…is enough to allow a jury to decide whether a reasonable caregiver on the receiving end…would have viewed it as sufficiently severe or pervasive, even considering the medical condition of the harasser.”  The facts significant to the court of appeals seemed to be the frequency of the resident’s conduct (daily), its severity (physical sexual assault and violent outbursts), and its impact on Gardner’s employment (she was on medical leave for three months because of the injuries she sustained in the altercation).  It probably didn’t help that a supervisor was dismissive of Gardner’s concerns.

While the facts in Gardner may show extreme and unusual patient behavior, it nonetheless establishes a troubling precedent for long term care facilities where dementia patients live.   Unlike an employee who can be abruptly terminated, residents in care facilities, particularly those receiving Medicaid benefits, have rights that prevent them from being immediately discharged.   Sometimes such residents have the right to hearing before an administrative law judge, who may or may not agree the patient can be evicted, or who may delay the eviction.  In the meantime, these residents must be cared for.  Depending upon the size of the facility and the number of care giving employees, simply reassigning an employee away from the difficult resident on a permanent basis could be quite difficult.    Long term care facilities will have to be more attentive than ever to balancing the rights of caregiving employees to be free from harassing conduct while also providing adequate care for difficult residents whose bad behavior is often the result of their medical condition.

For an industry that already faces a challenging regulatory and legal environment, the prospect of more sexual harassment jury trials arising out of the behavior of dementia patients is not a welcome development.

How much extra leave is reasonable for an employee who has exhausted FMLA but is not yet capable of returning to work? Does an employer have to keep the absent employee’s job open?  What medical evidence is needed?   How much interactive dialogue is enough?  What about an employee is who is unreasonable and/or demanding?

A recent opinion from the Eighth Circuit provides helpful guidance about these and other problems employers face when deciding whether extended medical leave is a reasonable accommodation for an employee with a serious medical condition who is not yet capable of returning to work. See Brunckhorst v. City of Oak Park Heights, (8th Cir. 2/4/2019).

Continue Reading Eighth Circuit Case Provides Guidance on How to Handle the Vexing Problem of Extended Medical Leave as a Reasonable Accommodation

This is a question about which Iowa employers are increasingly concerned.  The probability your employees and applicants for employment have used marijuana in some form has substantially increased in recent years.    Medical marijuana use is now legal in 34 states and the District of Columbia.  Recreational use is legal in ten states.    But, marijuana is still classified as a “Schedule I” drug under the Federal Controlled Substances Act, making it illegal to possess, use, or sell.  The very fact that marijuana is classified as a Schedule I drug means the Food and Drug Administration has determined it has no currently accepted medical use, a lack of accepted safety for use under medical supervision, and a high potential for abuse.

Continue Reading Does Iowa’s Medical Marijuana Law Impact an Employer’s Right to Maintain a Drug-Free Workplace?

In 1990 Congress enacted the Older Workers Benefit Protection Act (OWBPA) out of concern that employees terminated  as part of a Reduction in Force (RIF) did not fully understand the rights they were giving up in exchange for the payment of severance benefits.   Under OWBPA, a severance agreement entered into with a terminated employee over age 40 is not valid unless the agreement contains certain provisions.   Among other things, the release is supposed to be written in easy to understand language rather than legal jargon; it must advise the employee to seek advice from an attorney; it must allows the employee adequate time to consider whether to sign the release (21 to 45 days, depending upon how many employees are part of the RIF); and, in the event the employee changes his mind after signing, the employee has seven days to revoke the agreement.  If the release does not comply in every respect, it is not valid, and an employee who signed and accepted the severance payments may still sue for age discrimination under the federal Age Discrimination is Employment Act (ADEA).   An employee who sues may not even  have to return the money received as part of the severance agreement.

Continue Reading Are You Facing a Reduction in Force? Make Sure the Release is Valid or You May Pay Severance and Still Get Sued for Age Discrimination.

Although many employers use progressive discipline policies, I am typically not a big fan.   In theory progressive discipline seems like a good idea:  it allows an employee to learn from their mistakes.  It puts the employee on notice that further discipline is going to have more serious consequences.    It is difficult for an employee who has gone through the steps to claim surprise when the termination arrives.

On the other hand, progressive discipline limits an employer’s flexibility.   Sometimes it is clear an employee isn’t working out, but the company feels bound to go through the steps before terminating.   In other cases, the circumstances may warrant giving an employee more chances that the policy allows.  In those situations, an employee may be terminated simply because they are on the last step, even though the company would rather keep the employee.

Continue Reading Employer’s Consistent Use of Progressive Discipline Defeats Discrimination Claim

Publisher’s Note:  Today’s guest post is provided by Brandon Underwood, one of my colleagues at Fredrikson & Byron, P.A.   Hopefully Brandon will catch the blogging bug and continue to post….

The Americans with Disabilities Act (ADA) forbids medical examinations and inquiries in employment.  But not all of them.  Instead, an examination or inquiry’s permissibility, and scope, turns primarily on when it occurs.  Too early, and the examination violates the ADA.  Too late, and it may as well.

Continue Reading Court Finds Employer’s Inquiry about Health Conditions of New Employees Absorbed in Merger Complies with ADA

In the last two sessions, the Iowa legislature has amended Iowa’s private sector drug testing law to give employers additional tools to combat employee substance abuse.   In last year’s session, the legislature amended the law to allow employers to use hair follicle testing for pre-employment drug screens.  Prior to the amendment, the law allowed only testing using urine, blood, or oral fluid.

In the 2018 session, the legislature again amended the law to lower the threshold at which an employer may take action based upon an employee’s positive alcohol test.    Effective July 1, an employer may take action if the employee has a blood alcohol concentration of at least .02% .  The existing standard is .04%.

Continue Reading Iowa Legislature Toughens Drug Testing Law, But Legal Risks for Employers Remain

In the recent case of Jahnke v. Deere & Co. (May 18, 2018), the Iowa Supreme Court ruled that a Deere employee who was repatriated to the United States as discipline for engaging in sexual misconduct while on assignment at a Deere factory in China did not state a claim for discrimination under the Iowa Civil Rights Act (ICRA)

Jahnke sued Deere in Iowa State Court, alleging the decision to repatriate him from China to a lower paying job in Waterloo, Iowa was based on his age, sex, and national origin.    While on assignment as the manager of a Deere factory in China, Jahnke engaged in sexual relationships with two younger, Chinese women who were in his “span of control”, which violated Deere’s policies.   Jahnke claimed Deere violated the Iowa Civil Rights Act because his discipline was harsher than that imposed on the female employees with whom he had the relationships.

Continue Reading Iowa Civil Rights Act Protections Do Not Apply to Ex-Pat Employee