Labor and Employment Law

The Occupational and Safety Administration’s (“OSHA”) new electronic reporting requirements impact certain employers’ post-accident drug testing policies that require an automatic drug test following a work related injury.  OSHA adopted the rule in May 2016, (effective August 10, 2016) in order to improve tracking of workplace injuries and illnesses, by requiring certain workplaces to submit specified information electronically.  See 29 CFR 1904.  The workplaces governed by the new rule include all establishments with 250 or more employees that were already subject to OSHA’s record-keeping requirements as well as establishments in certain designated industries with 20 or more employees.  Id. at Sections 1904.41(a)(1) & (a)(2).   

Though the purpose of the rule is administrative, the commentary to the rule also states that “. . . blanket post-injury drug testing policies deter proper reporting.” Cmt. to Section 1904.35(b)(1)(iv).  Specifically, OSHA states that its rule prohibits employers from “ . . . using drug testing (or the threat of drug testing) as a form of adverse action against employees who report injuries or illnesses.”  Id.  Instead, OSHA suggests that employers should use post-injury drug testing only when there is “. . . a reasonable possibility that drug use by the reporting employee was a contributing factor to the reported injury or illness” unless the drug testing is required by federal or state law or regulation.  Id.  According to OSHA, bee stings, repetitive strain injuries, injuries caused by a lack of machine guarding or by a machine or tool malfunction are examples of work accidents in which employee drug use likely was not a factor.  Therefore, drug testing after such an accident/injury likely would violate OSHA’s rule.  Unlike some other retaliation prohibited by Section 11(c) of the Occupational Safety and Health Act, OSHA can enforce this prohibition without an employee complaint.

Many employers have policies that require an automatic post-accident drug test if the accident results in an injury.  Unless and until the OSHA rule is determined to be unlawful, we believe that employers subject to the rule likely should modify any automatic post-accident testing policy (except those applicable to Department of Transportation testing or other federal or state requirement) to provide that a post-accident test will be administered when there is a reasonable possibility that employee drug use contributed to the injury.  Please let us know if you would like us to determine whether your company (establishment) is subject to this rule and if so, whether you would like us to analyze or modify your company’s policy.  

The foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation and should not be relied on as such.  Please contact one of our labor and employment lawyers if you have any questions.

This update was prepared by Charles S. Elbert and Erin M. Leach.

On May 18, 2016, The United States Department of Labor released its final revised overtime rule under the Fair Labor Standards Act, 29 U.S.C. § 201 et. seq. (“FLSA”).  This rule represents the most significant modification of the FLSA’s overtime regulations in over twenty years. 

Prior to the rule, the longstanding overtime exemption requirements were: (1) employee is paid on a salary basis rather than an hourly wage basis; (2) employee is paid at a salary level of at least $23,660 annually (or $455 per workweek); and (3) employee’s duties meet the elements of a professional, administrative, executive, or outside sales (collectively referred to as “white-collar”) exemption.  Requirements (1) and (3) remain unchanged by the rule.  However the rule significantly modifies requirement (2) by raising the threshold salary level to $47,476 annually (or $913 per workweek).  Consequently, “white-collar” employees with a salary less than that amount will no longer be exempt, and therefore will need to record their time and be paid overtime for working more than 40 hours in a workweek.  This changed salary level has the potential to affect the wages of over four million U.S. workers in its first year of implementation. 

The rule goes into effect December 1, 2016, and applies to all employers covered by the FLSA.  In addition, the new salary threshold is not static; it is set to adjust every three years, beginning January 1, 2020, and tracking the 40th percentile of wages earned by full-time salaried workers in the lowest wage census region in the United States.  Other modifications made by the final rule include that “highly compensated” employees must be paid an annual salary of $134,004 (previously $100,000) in order to meet that exemption, and that employers will be allowed to include nondiscretionary bonuses and incentive payments, including commissions, in satisfying a portion of the minimum salary requirements for both “white-collar” and “highly compensated” employees. 

As a result of this final rule, employers should undertake a comprehensive and careful audit of their current wage and salary structures to ensure that they make appropriate adjustments for salaried employees classified as exempt currently earning between $23,660 and $47,476.  Based on each employer’s needs and staffing practices, there are several potential ways in which compliance with the new rule can be achieved, including: raising salaries, decreasing salaries to account for anticipated overtime, reclassifying employees, limiting or requiring pre-approval for overtime hours, redistributing workloads, using more part-time employees, using outside vendors to perform certain functions, and restructuring salaries to include bonuses/incentive pay. The enactment of this major change might also signal that it is a good time for employers to reconsider and update all of their exempt/nonexempt classifications, particularly with regard to jobs that have changed in the last 20+ years.  And, because the salary threshold level is set to adjust every three years going forward, employers need to continually review the above possibilities and consider their application to each employer’s particular workforce.

The foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation and should not be relied on as such.  Please contact one of our labor and employment lawyers if you have any questions.

This update was prepared by Charles S. Elbert, Kevin A. Sullivan, and Erin M. Leach.

On September 22, 2015, the Missouri Supreme Court, in a 5-2 decision, reversed a jury verdict in favor of the Kansas City Chiefs in a Missouri Human Rights Act (“MHRA”) age discrimination case brought by a former employee on the ground that the trial court improperly excluded evidence from numerous other older employees relating to the cessation of their jobs.  Cox v. Kansas City Chiefs Football Club, Inc., 473 S.W.3d 107 (Mo. banc 2015).  Plaintiff, who was 61, was terminated for poor performance and insubordination and was replaced by a 37-year-old employee.  At trial, plaintiff had evidence of several possible age-related statements made by Chiefs’ management, and his theory was that the Chiefs instituted a policy of terminating older workers and replacing them with younger workers.

The trial court had excluded from evidence the testimony of 17 former employees, who were going to testify about the termination of their employment, replacement by younger workers, and their claims against the Chiefs.  The trial court excluded this evidence on two grounds:  (1) plaintiff alleged only one act of discrimination, not a pattern and practice (systemic and repeated discriminatory conduct), and therefore the testimony was irrelevant to the claim; and (2) these former employees were not similarly-situated to plaintiff, meaning they did not have the same supervisor, same decisionmaker, or similar job type.  The Chiefs prevailed at a jury trial, and plaintiff appealed.

The Missouri Supreme Court reversed the jury verdict and remanded the case for retrial, holding that the trial court abused its discretion in excluding the circumstantial evidence from the other employees allegedly terminated because of their age.  The court held that this type of “me too” evidence of other acts involving other employees was not limited to a pattern and practice claim and did not require a plaintiff to show that the other employees were similarly-situated.  The Supreme Court also ruled that such evidence could come in regardless of whether the same decisionmaker was involved in the termination decisions.  The Court reasoned that a plaintiff who alleges or has a theory of a top-down strategy to replace older workers can offer this “me too” evidence and that the trial court must do an individualized, fact-based analysis to determine its admissibility.

The implications for employers facing MHRA claims is that plaintiffs probably will seek (and likely obtain) in discovery information relating to other claims of discrimination or terminations involving other employees in the same protected class (e.g., race, age, gender or disability) on an organization-wide basis.  Practically, this will likely make discovery more burdensome and expensive.  In addition, at trial, there is the risk that testimony from another employee, who might be in a completely different department with a completely different employment history, could be admitted into evidence, which means that disgruntled former employees could strengthen their cases by testifying in each other’s cases.

As always, the foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation and should not be relied on as such.  Please contact one of our labor and employment lawyers if you have any questions.

This update was prepared by Charles S. Elbert and Kevin A. Sullivan.

On October 27, 2015, the Missouri Court of Appeals, Western District, in a case of first impression, held that employees could not state a cause of action for discrimination or harassment based on sexual orientation or preference under the Missouri Human Rights Act (“MHRA”).  Pittman v. Cook Paper Recycling Corp., 478 S.W.3d 479 (Mo. App. W.D. 2015).  In Pittman, a male homosexual employee filed a lawsuit under the MHRA claiming that he suffered discrimination and hostile work environment due to his sexual preference, alleging that the president of the employer made several highly insulting and derogatory remarks to the employee and treated him differently than heterosexual co-workers.  The trial court granted the employer’s motion to dismiss, which was appealed by the employee.

In a 2-1 decision, the appellate court’s majority opinion affirmed the dismissal and held unequivocally that the “Missouri Human Rights Act does not prohibit discrimination on the basis of sexual orientation.”  In so holding, the majority opinion strictly interpreted the MHRA’s language and found that it prohibits discrimination based only on “sex” – which by dictionary definition means only “one of the two divisions of human beings respectively designated as male or female.”  The majority also relied on the fact that the employee had alleged sexual preference discrimination, not sex discrimination.  The majority stated that it was bound by the language of the MHRA and could not rewrite it.  It found persuasive that Missouri, unlike other states, has not enacted legislation prohibiting sexual orientation discrimination, which tends to show that the Legislature did not contemplate barring such discrimination.

The lengthy dissenting opinion included interpretational and policy grounds to support inclusion of sexual orientation discrimination in conduct prohibited by the MHRA.  First, in using the same dictionary definitions, the dissent interpreted “sex” to include sexual orientation because sexual orientation is inherently a sex-based consideration.  The dissent further noted that the MHRA should be broadly construed in favor of applicability of the statute.

Currently, the Missouri Supreme Court is deciding whether or not to accept transfer of the case, which it could do based on the lengthy dissent and the important issues in the case.  It should be noted that Missouri appellate courts have previously held that same-sex discrimination and harassment is prohibited by the MHRA.  We will monitor this issue because the recognition if a MHRA claim for sexual orientation discrimination exists, then employers must account for it in policies, practices, and employee training.

The foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation and should not be relied on as such.  Please contact one of our labor and employment lawyers if you have any questions.

This update was prepared by Charles S. Elbert and Kevin A. Sullivan.

On August 27, 2015, the National Labor Relations Board (“NLRB”) broadened the joint-employer standard under the National Labor Relations Act (“NLRA”) in Browning-Ferris Industries of California d/b/a BFI Newby Island Recyclery, Case 32–RC–109684.  This is a significant decision because it modifies long-standing precedent.  Generally, two entities are joint employers if (1) they are both “employers” within the meaning of the common law and (2) they share or codetermine those matters governing the essential terms and conditions of employment.  Previously, the NLRB had held that the second factor is met if the employer has “direct and immediate” control of the employees.  However, under the NLRB’s new interpretation in Browning-Ferris, the second factor now can be established by the simple “right to control” possessed by an entity or by its “indirect control” of employment matters.  

In the Browning-Ferris case, BFI used a staffing agency.  The agency was highly involved in the day-to-day affairs of BFI’s employment matters; it was responsible for hiring, paying, offering pay increases to, supervising, disciplining, and firing its temporary workers.  But despite the agency’s apparently singular control of the terms and conditions of those workers’ employment, the NLRB found that BFI was a joint employer.  The NLRB’s decision was based in part on the contract between the parties, which reserved BFI’s right to participate in many employment decisions, even though the NLRB acknowledged that BFI did not in fact exercise such powers.  This “right to control” the temporary workforce, along with BFI’s “indirect control” over temporary workers by its control of the facility itself and of the logistics of the recycling line, was enough to create a joint-employer relationship under the NLRB’s restated test.  The NLRB’s stated intent of the new interpretation is to better effectuate the purposes of the NLRA, by accounting for the fact that over 2.87 million American workers are now employed through temporary agencies and are thereby subject to somewhat unique employment relationships.

This decision may impact your business to the extent that it is subject to the NLRA and its contracts, or otherwise works with, temporary staffing agencies, or other contractors.  This expansion of the joint-employer standard creates a greater risk that an employer will be found to be a joint employer and therefore could be subject to union organizing activities by, and possible collective bargaining obligations with, employees of such agencies or contractors.  Therefore, these arrangements, including written contracts, should be carefully analyzed and structured to avoid joint employer status.

The foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation and should not be relied on as such.  Please contact one of our labor and employment lawyers if you have any questions.

This update was prepared by Charles S. Elbert, D. Leo Human, and Erin M. Leach.

On July 15, 2015, The United States Department of Labor’s Wage and Hour Division released an Administrator’s Interpretation, which broadly defines an “employee” under the Fair Labor Standards Act (“FLSA”) so that most workers would be classified as employees, not independent contractors.  The Administrator’s Interpretation applies an “economic realities” test to the FLSA’s broad “suffer or permit” employment standard to conclude that an employer “suffers or permits” an employee to work if that individual is dependent on the entity as a matter of economic reality.

The economic realities test examines six factors to determine whether a worker is an independent contractor: (1) whether the work is an integral part of the employer’s business; (2) whether the worker’s managerial skill affects profits; (3) the investment of the worker; (4) whether the worker’s job requires special skills; (5) the permanence of the worker’s relationship with his employer; and, (6) the degree of the employer’s control over the worker.  One of the more significant changes to the economic realities test is that a comparative analysis is now required to analyze the worker’s investment versus the employer’s investment in the enterprise.  Additionally, a worker’s independence is no longer conclusively proven by the ability to flexibly schedule their work.  The full text of the Wage and Hour Division’s Administrative Interpretation, which includes a thorough discussion of all six factors, can be found here.

Obviously, employee status under the FLSA triggers employer obligations, including payment of overtime.  Both the DOL and plaintiffs’ lawyers aggressively pursue employee misclassifications.  Even though the Administrator’s Interpretation is not binding on courts, they likely will defer to it.   As a result, employers should reexamine their current relationships with independent contractors to determine if workers are properly classified under this Administrator’s Interpretation.  Any semblance of a permanent or indefinite relationship with an independent contractor should be avoided, and the terms of the relationship or the specific project should be spelled out in the agreement.  Moreover, companies should refrain from giving independent contractors rights and access that militate against their status as independent contractors. 

The foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation and should not be relied on as such.  Please contact one of our labor and employment lawyers if you have any questions.

This update was prepared by Charles S. Elbert and Kevin A. Sullivan.

On June 27, 2015, the United States Supreme Court held that marriage between same-sex couples is a fundamental right under the Fourteenth Amendment’s due process and equal protection clauses.  Obergefell v. Hodges, 135 S.Ct. 2584, 575 U.S. ___ (2015).  Although further litigation may occur, this ruling clears the way for same-sex marriage in all 50 states.  This ruling is significant for employers because same-sex couples will now probably be entitled to state marriage and company spousal benefits.

Since marriage triggers multiple workplace benefits, employers should reexamine any policies implicating spouses and those that may define marriage along gender-specific lines. The most relevant benefits affected by this decision are health, bereavement, retirement and fringe benefits.  Leave policies, including FMLA policies, should also be examined. Many employers likely have already begun this process in the wake of the Supreme Court’s decision in U.S. v. Windsor, 133 S.Ct. 2675, 570 U.S. ___ (2013), which held federal benefits could not be denied to validly married same-sex couples, and Barrier v. Vasterling, No. 1416-CV03892 (Jackson Cnty. Cir. Ct., Oct. 3, 2014), where a Missouri court ruled same-sex couples could not be denied benefits under state law. It is also important to note that Obergefell neither creates a new protected class under Title VII nor expands any discrimination laws.

As always, the foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation and should not be relied on as such. Please contact one of our labor and employment lawyers if you have any questions.

This update was prepared by Charles S. Elbert and D. Leo Human.

On June 1, 2015, the United States Supreme Court held that in order to prevail on a Title VII religious discrimination claim, an employee did not need to prove that the employer had knowledge of a request for a religious accommodation, but only needed to prove that the employer’s desire to avoid an accommodation was a motivating factor in an employment decision.  E.E.O.C. v. Abercrombie & Fitch Stores, Inc., 135 S.Ct. 2028, 575 U.S. ___ (2015).  In that case, Abercrombie & Fitch refused to hire an otherwise qualified Muslim woman, who wore a headscarf, because the wearing of the headscarf conflicted with the dress policy, which forbade any headwear.  The applicant did not request to wear the headscarf, but the hiring manager believed she would.  Because Title VII requires an employer to reasonably accommodate a religious observance or practice, the employer argued that actual knowledge of the need for a religious accommodation was necessary for an employer to be found liable.  The Court rejected that argument and found that the employer’s knowledge of an accommodation request was not an essential element of a religious accommodation discrimination claim because Title VII had no such knowledge requirement.  The Court held that “the rule for disparate-treatment claims based on a failure to accommodate a religious practice is straightforward:  An employer may not make an applicant’s religious practice, confirmed or otherwise, a factor in employment decisions.”

This decision has several practical consequences for employers.  First, an employer should neither assume that an employee is a strict adherent to any religion nor base any employment decision on that assumption.  An employer’s intent to avoid even a prospective religious accommodation for an employee can give rise to liability.  Second, an employer should likewise carefully monitor its policies with respect to an employee’s religious practices:  an employer must be flexible when it comes to applying such policies to religious practices.

However, an employer is not required to accede to every religious-based request. To reject an accommodation, an employer must demonstrate that the accommodation would place an “undue hardship on the conduct of the employer’s business,” such as safety, infringement on other employees’ rights, conflict with a collective bargaining agreement, or costliness.  Similarly, the accommodation must be reasonable, and the employer and employee should engage in an interactive process to address concerns.  And if there is a legitimate doubt about an accommodation request, an employer can perform a limited inquiry to ensure that the religious belief is sincerely held by the employee.

As always, the foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation and should not be relied on as such.  Please contact one of our labor and employment lawyers if you have any questions.

This update was prepared by Charles S. Elbert and Kevin A. Sullivan.

The United States Supreme Court held, in a March 25, 2015 decision, that employers must either accommodate pregnant employees to the same degree as they accommodate other employees “similar in their ability or inability to work,” or show a legitimate, nondiscriminatory reason for refusing to do so.  Young v. United Parcel Service, 135 S.Ct. 1338, 575 U.S. ___ (2015).  This means that if employers allow such accommodations as light duty assignments, leave or flextime for employees with temporary disabilities, on-the-job injuries, or otherwise, then they likely must offer the same accommodations to similarly situated pregnant employees or face potential liability under the Pregnancy Discrimination Act unless they have a legitimate non-discriminatory reason for refusing.  An undue burden on the employer may constitute such a reason.

Young represents a shift in the law in that it allows pregnant employees to demand the same treatment that is being offered to disabled, injured, aged, or other employees whose work ability is comparable to the pregnant employee’s.  The employee need not have direct evidence of discriminatory statements or animus, but only circumstantial evidence to meet her burden of proof that she was treated differently than others who were similarly unable to perform their job functions.  For example, the pregnant UPS driver in Young offered statistical evidence of how often pregnant versus non-pregnant employees were allowed to work under lifting restrictions to create an inference that UPS’s stated reason for placing her on unpaid leave (a 70-pound lifting requirement) was only a pretext for pregnancy discrimination.

Therefore, Young is a reminder that care must be taken when applying an employer’s workplace accommodation policies to pregnant employees.  Employers should consider whether to revise their light duty policies and, if faced with specific situations involving possible accommodations for pregnant employees, employees should carefully analyze how employees with similar restrictions are accommodated.

As always, the foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation and should not be relied on as such.  Please contact one of our labor and employment lawyers if you have any questions.

This update was prepared by Charles S. Elbert, D. Leo Human, and Erin M. Leach.

The EEOC reports that it received 88,778 charges last year.  This is a decrease from recent years, which the EEOC attributes at least partly to the 2013 government shut-down.  42.8% of 2014 claims were based on allegations of retaliation.  This is up from last year, indicating once again that employers must carefully consider any potential adverse employment action not only for possible discrimination against a protected class, but also to avoid the appearance of retaliation or other unlawful conduct.  Other claims most often alleged were race, sex, disability, and age discrimination, in that order. 

Enforcement proceedings administered by the EEOC itself garnered $296.1 million in total monetary relief in 2014, and the EEOC's litigation program collected $22.5 million.

Not surprisingly, the most complained of practice was again discharge.  However, 30% of all charges in Fiscal Year 2014 alleged harassment of some type, including sexual or racial harassment.  This is an increase from prior years.  The take away from these statistics is that employers should be proactive in educating employees about their obligations under the law.  We believe that training to properly and fairly evaluate, discipline, supervise, and otherwise deal with employees is a key element in reducing charges of discrimination.

As always, the foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation and should not be relied on as such.  Please contact one of our labor and employment lawyers if you have any questions.

This update was prepared by Charles S. Elbert, D. Leo Human, and Erin M. Leach.

The National Labor Relations Board (“NLRB”) held in a 3-2 decision last month that employees who are given access for work purposes to their employer’s email system are presumptively permitted to use that system to engage in communications protected by Section 7 of the National Labor Relations Act (“NLRA”).  Purple Communications Inc. and Communication Workers of America, 361 N.L.R.B. No. 126 (Dec. 11, 2014). Section 7 covers all “concerted” communications that support employee interests, including general discussions of the terms and conditions of employment, and applies to both union and non-union workplaces.  These protections do not apply to employees of Missouri local governmental entities that are not governed by the NLRA, but Purple Communications may still be useful by analogy when considering a public employer’s obligations under Missouri law applicable to public employees.

Purple Communications reverses previous NLRB precedent, which held that employers could prohibit non-work use of their email systems as long as restrictions were applied consistently and in a manner that did not discriminate against Section 7 activity. As permitted by this previous precedent, many employers have policies that restrict email to “business use.” Following Purple Communications, these policies may now be subject to legal challenge. Consequently, employers should review their email and technology policies to ensure compliance with the Purple Communications decision.

As always, the foregoing is for informational purposes only and does not constitute legal advice regarding any particular situation and should not be relied on as such. Please contact one of our labor and employment lawyers if you have any questions.

This update was prepared by Charles S. Elbert, D. Leo Human, and Erin M. Leach.