The EEOC has issued an advisory to employers regarding how to deal with the Swine Flu or H1N1 virus. We are working on an analysis of what specific issues California employers must be aware of. Remember, there are significant differences between the Americans with Disabilities Act ("ADA") and the Fair Employment and Housing Act ("FEHA").
Many employers rely on arbitration agreements with their employees to control litigation costs. But the right to require arbitration is under attack from various directions. Here's a recent one.
On October 20, 2009, a California appellate court issued an opinion that left the door wide open for challenging binding arbitration awards. In Burlage v. Superior Court, the dispute involved purchase of a home. After the close of escrow, the buyers learned that part of what they were told was their property actually belonged to a neighbor. They sued the seller, claiming he fraudulently failed to disclose the encroachments. The arbitrator ruled that damages must be determined as of the close of escrow and excluded evidence of subsequent actions that lessened (practically eliminated) plaintiff's damages. The trial court vacated the award and the buyers took a writ.
In a 2-1 decision, the appellate court affirmed the decision to vacate the award. It based its decision on California Code of Civil Procedure section 1286.2 which allows a court to vacate an arbitration award where a party's rights "were substantially prejudiced . . . by a refusal of the aribtrator to hear evidence material to the controversy . . . ." Because the arbitrator did not admit evidence of damages from a period of time he concluded was irrelevant, the court concluded that the award could be vacated.
The dissent characterized the arbitrator's decision as one as to when damages should be determined and explained that the law does not permit courts to overturn arbitration awards just because they would reach a different conclusion on a legal issue. It noted that many legal rulings would necessarily result in determinations as to what evidence was or was not material to the controversy.
The majority opinion also raised the question whether arbitrators, to avoid having their decisions vacated, might be more inclined to admit evidence. It concluded, however, that that was an overly cynical view and that the decision would not impact evidentiary rulings. It remains to be seen whether a little healthy cynicism might be justified here.
Most employers and managers understand what sexual harassment is. In California, they've gone through the mandatory training (pdf). So they know about hostile work enviroment and quid pro quo harassment. ("Quid pro quo" being loosely translated as "No I won't sleep with you to save my job. You disgust me. Now go away so I can call my lawyer.")
But California's requirements for a sexual harassment investigation still seem to be a source of confusion. The October 9, 2009 appellate court decision in Nazir v. United Airlines (pdf) highlights this issue. (Faithful readers will note that Alex and I have both blogged about different aspects of this case already. But there's a lot in there and you should thank us for giving you the highlights so you don't have to read through the 54-page opinion yourself.)
In Nazir, the court criticized United for:
- Failing to follow its own policies -- The policies are there for a reason. Use them. Any irregularities allow plaintiffs and their attorneys to raise doubts as to whether this was a good faith investigation or a cover-up.
- Delays in responding to complaints -- Delays make it too easy for a plaintiff to argue that the employer doesn't consider protecting employees from harassment to be a priority.
- Failing to interview witnesses identified by the accused -- To get any use out of an investigation, it needs to be thorough.
Other important rules for investigating harassment include:
- Picking a qualified investigator -- You want someone who's far enough from the situation to be impartial and who has experience investigating these types of issues. It also needs to be someone who understands how to question witnesses. (Now the cynics out there may be thinking that I'm just saying that so people hire us to do their investigations. To that I respond: 1) If people follow these steps, there will be less harassment litigation, and therefore less work for me and my ilk; and 2) It's not as if the goal of this blog is to repel clients.)
- Documenting every step -- The most critical documentation will be written statements from key witnesses. It minimizes the opportunity people have to change their stories. And save every scrap of documentation. If you dispose of anything expect to be questioned about what you were trying to hide.
- Evaluate the evidence objectively -- The person complaining doesn't have to prove his or her case beyond a reasonable doubt. Even if it's the proverbial "he said/she said," you need to decide who is more credible.
- Take appropriate remedial action -- If you conclude there was harassment, take actions reasonably calculated to stop it.
- Keep the complaining party informed -- Let them know the status of the investigation, the conclusions, and the steps being taken. Then when it's all over, follow up with the complaining party periodically to make sure that there have been no further issues.
- Don't add a retaliation claim to your problems -- Do nothing to the complaining party that could be viewed as punitive. This includes transfers, reductions in hours, or anything else that penalizes or isolates them.
A prompt, thorough investigation can go along way to preventing a harassment claim. A shoddy investigation can have the opposite effect. As I've said before, harassment litigation is less about what the alleged harasser did than about how the company responded to the situation.
Caveat emptor is the rule of thumb in any marketplace. But nowhere is this bit of wisdom more true than on Craigslist. You can get pretty much anything through Craig. And that's the problem. One issue we have noticed is the rise of internship offerings. These jobs promise lots of intangibles:
"You are serious about pursuing a career in PR – that’s why you seek an internship. If you give us your all, we’ll guarantee you one of the most exciting experiences of your college years. We’ll also give you support to speed your post-college success in a number of ways, ranging from experience and skills development through introductions, references and referrals."
But the Division of Labor Standards Enforcement (DLSE) says not so much. It has developed the following internship guidelines. And they require that in order to be exempt from the wage and hour requirements of the IWC Orders, the intern’s training must be an essential part of an established course of an accredited school or of an institution approved by a public agency to provide training for licensure or to qualify for a skilled vocation or profession. Also, the program may primarily benefit the employer, a regular employee may not be displaced by the trainee, and the training must be supervised b y the school or a disinterested agency. Otherwise, any time spent interning (even time spent giving less than one's all) will be considered “hours worked” notwithstanding any ancillary excitement, experience, or introductions that may be provided.
Alex already wrote about some procedural issues in this case. But there's a lot here to blog about. Here's my list of some of the lessons from this October 9, 2009 California Appellate Court decision(pdf):
Lesson No. 1: Appellate courts can be hostile to summary judgment motions in employment litigation. The court here went so far to say that summary judgment is rarely appropriate in employment cases. It expressed concern that the procedure was being abused in employment litigation, "especially by deep pocket defendants to overwhelm less well-funded litigants." How's that for a generalization? I don't know the circumstances that compelled these attorneys to file 1056 pages of moving papers and 1150 pages of reply papers. But that's not standard operating procedure for all defense counsel. Plenty of us realize that the way to win these motions is to simplify the issues, not complicate them.
Sub-Lesson No. 1(a): If the court uses the adjective "deep pocket" in a case where you're the defendant, count on those pockets getting lighter before the day is done.
Lesson No. 2: If in the second paragraph of the opinion, the court says that your motion is "the poster child for such criticism" and "may well be the most oppressive motion ever presented to a superior court," you're probably not going to like what they say in the other 52 pages.
Lesson No. 3: To win an employment case for the defense you need to succeed at multiple levels. The employer here got a favorable ruling from the DFEH and then won on summary judgment. Things were probably looking pretty bright until the appellate court issued this scathing decision.
Lesson No. 4: It's another bad sign for the employer defendant when the court, in describing the company's response to the harassment, puts "investigation" in quotes. Employment law cases are less about what happened to the plaintiff than how the company responded to the situation. Some of the missteps the court railed against here were United failing to follow its own policies, delaying in addressing the issues, and not interviewing witnesses thought to have relevant information. I don't think many employers understand the detailed requirements California courts impose on investigations of complaints of harassment and similar misconduct. Maybe that will be the topic of a future blog entry.
Employment Law360 reported yesterday on Fullbright & Jaworski's 2009 Litigation Trends Survey. One of the survey's conclusions was that: "For the sixth consecutive year, labor and employment disputes topped the list of legal worries for U.S. corporate counsel . . . ."
With juries becoming increasingly hostile to corporate defendants, Congress eager to pass more employee-friendly legislation, and more potential plaintiffs unemployed than at any point in recent memory, don't expect that to change any time soon. We can only hope that those in-house attorneys take some slight comfort knowing that their outside counsel are lying awake at night, too.
Pending decisions from the California Supreme Court in Brinker Restaurant Corp. v. Superior Court of San Diego County and Brinkley v. Public Storage, Inc., the Division of Labor Standards Enforcement must still adjudicate Berman hearings concerning meal period claims. Consequently, the DLSE has adopted an “HQ Memorandum” presumably to guide interim agency decisions. The Memo makes clear that “employers are not obligated to ensure that their employees take meal periods.” But it also imposes the so-called “5 Hour Rule” requirement: “The first meal period provided by an employer must commence prior to the end of the fifth hour of work.” It seems to me that these rules are in conflict. If an employer is not obligated to “force” an employee to take a meal period, then it should not be required to “force” a meal period under specific time constraints. Recently, we have been able to obtain agency decisions using this argument. If you would like a copy of the decisions or to discuss strategy, send me an email.
Summary judgment can be an employer's best friend. But it can also be a minefield. There are many technical rules to be observed and, like a microcosm of law practice itself, the moving papers are just a shoe waiting to drop. (Have you filed your Appendix of Non-California Authorities? Have you cited to the number or letter of the exhibit, the specific page, and, if applicable, the paragraph or line number?) I urge you to read Nazir v. United Airlines, Inc. (pdf), which, in addition to being entertaining, discusses procedural conundrums not directly addressed by the rules themselves.
For example, contrary to the admonition issued by Weil & Brown in their California Practice Guide, many lawyers insist on including background facts in their Separate Statements. Resist! Include only those facts which are truly material because the Separate Statement effectively concedes the materiality of whatever facts are included. You don’t want a motion denied because the plaintiff’s job title was “Special Administrative Assistant” and not “Administrative Assistant.”
Also, avoid unnecessary objections. In response to a misplaced objection asserting “lacks foundation and hearsay,” the Court had this to say: “No adjective is adequate to describe an objection that one who is called names lacks “foundation” to testify about them. And one does not need to be Wigmore to know that plaintiff was not introducing the names for their truth.” Nice!
However, some habits will die hard. Although the Court observes that “[t]here is no provision in the statute” for a Reply Separate Statement, I still use them and think they can be of assitance to the Court.
Finally, although this opinion is hardly management friendly, there is this sound bite: "[S]ome counsel [are] too often willing to file suit whenever an employee in a protected class suffers some adverse employment decision. Such cases should be disposed of as quickly and efficiently as possible."
In California, we have the Fair Employment and Housing Act which, among other things, prohibits employment discrimination on a variety of bases. The closest federal equivalent is Title VII. But Title VII doesn't prohibit age discrimination. That prohibition comes from the Age Discrimination in Employment Act (ADEA).
Last June, in Gross v. FBL Financial Services (pdf), the Supreme Court decided (5-4) that because of differences in the wording of Title VII and the ADEA, plaintiffs alleging age discrimination must meet a different standard of proof. Specifically, they must show that age was the "but-for" cause of the employment decision at issue.
As reported in today's New York Times, Sen. Tom Harkin, D-Iowa; Sen. Patrick Leahy, D-Vt.; and Rep. George Miller, D-Calif. introduced the Protecting Older Workers Against Discrimination Act in reaction to the Gross decision. According to Representative Miller, “Workplace discrimination based on age is just as wrong as discrimination based on any other irrelevant factor -- and it should be treated as such in the court of law."
The problem with that rationale is that Congress itself has enacted protections for older workers ("older" referring in this context to those of us 40 and over) that aren't available to other protected categories -- most notably the Older Workers Benefits Protection Act.
Assume a hypothetical employer laid off two people -- a 41 year-old well-educated executive and a 39 year-old, mentally disabled, poorly educated, entry-level worker. By law, a separation agreement presented to the executive would have to (1) advise him to consult an attorney, (2) provide him up to 21 days to consider the agreement before signing, (3) provide him 7 days after signing to revoke the agreement, and (4) be written in language he can understand. These, and other requirements listed in 29 U.S.C. sec. 626(f), must be met or there's a presumption that the executive's agreement to the severance terms was not knowing and voluntary.
The entry level worker is entitled to none of those protections. It doesn't matter what other protected category he's in. Only people 40 and over get the benefits of that legislation.
So it doesn't seem that the issue is that everyone is entitled to the same protections. Because Congress doesn't mind when older workers receive greater protection than other workers. Why then are Senators Leahy and Harkin and Representative Miller (three white males in their 60s) so protective of the rights of older workers?