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PCCYFS 2012 Annual Spring Conference Changes in Law and Federal Agency Enforcement and Its Impact on Your Operations Presented By: Jill M. Lashay, Esquire.

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Presentation on theme: "PCCYFS 2012 Annual Spring Conference Changes in Law and Federal Agency Enforcement and Its Impact on Your Operations Presented By: Jill M. Lashay, Esquire."— Presentation transcript:

1 PCCYFS 2012 Annual Spring Conference Changes in Law and Federal Agency Enforcement and Its Impact on Your Operations Presented By: Jill M. Lashay, Esquire Shareholder Buchanan Ingersoll & Rooney, PC 213 Market Street, 3rd Floor Harrisburg, Pennsylvania 17101 (717) 237-4800 Jill.lashay@bipc.com © Copyright 2012 Buchanan Ingersoll & Rooney

2 PCCYFS 2012 Annual Spring Conference 2 Recent Developments EEOC Update ADA Update and ADAAA Regulations GINA Regulations Retaliation Claims/Whistleblower Claims FLSA Update USERRA Update "Unemployment" discrimination as a protected class

3 PCCYFS 2012 Annual Spring Conference 3 EEOC Update 99,947 charges filed with EEOC in 2011. Highest number of new charges in the EEOC's 46-year history. Through its enforcement, mediation and litigation programs, the EEOC won a record $455.6 million in relief for private sector, state and local employees, and job applicants for the 2011 fiscal year – more than $45 million increase over 2010. For third year in a row, retaliation claims were the most frequently cited form of discrimination charges.

4 PCCYFS 2012 Annual Spring Conference 4 EEOC Update Number of charges of race discrimination declined from 2010, but charges of sex, disability and age discrimination all increased to record highs. The administrative relief obtained by the EEOC for disability discrimination charges increased to roughly $103.4 million – almost 36% increase from 2010. This likely reflects the recent amendments to the ADA.

5 PCCYFS 2012 Annual Spring Conference 5 EEOC Update In early 2010, in connection with a workers' compensation leave exhaustion policy, Sears Roebuck & Co. paid the largest ADA settlement in EEOC history. The Northern District Court of Illinois approved distribution of a $6.2 million compensation fund to the former 235 employees that had been terminated from their positions. The average award for each claimant was approximately $26,300. EEOC alleged that Sears maintained an inflexible policy and terminated disabled employees instead of offering reasonable accommodations.

6 PCCYFS 2012 Annual Spring Conference 6 Significant Changes to the ADA The Americans with Disabilities Act ("ADA") prohibits discrimination against employees who have, had, or may be regarded as having a physical or mental impairment that significantly limits a major life activity. The ADA requires employers to engage in an "interactive process" to find reasonable accommodations for employees with disabilities.

7 PCCYFS 2012 Annual Spring Conference 7 Traditional ADA Framework Disability-related inquiries traditionally involved two steps: –Determining whether an impairment was a disability; and –Engaging in the "interactive process" to determine if a reasonable accommodation could enable a disabled employee to successfully perform the job.

8 PCCYFS 2012 Annual Spring Conference 8 New ADA Regulations On March 25, 2011, the Equal Employment Opportunity Commission ("EEOC") published the final regulations ("Regulations") (29 C.F.R. Part 1630) and accompanying interpretive guidance implementing the ADA Amendments Act of 2008 ("ADAAA"). The Regulations became effective on May 24, 2011. The ADAAA was intended to broaden the definition of disability under the Americans with Disabilities Act of 1990, 42 U.S.C. § 12101 et seq. ("ADA"), and make it easier for individuals with disabilities to obtain protection under the ADA. The Regulations implement this Congressional goal, explicitly affirming that the definition of "disability" must be "construed broadly in favor of expansive coverage to the maximum extent permitted by the terms of the ADA."

9 PCCYFS 2012 Annual Spring Conference 9 "Disability" Now… After ADAAA For the purposes of the ADA, a disability is: –A physical or mental impairment that substantially limits one or more major life activities, –a record of such an impairment, –or being regarded as having such an impairment. The ADAAA does not change the definition of disability, but it significantly changes the interpretation.

10 PCCYFS 2012 Annual Spring Conference 10 Interpreting "Disability" Under ADAAA The ADAAA minimizes the first step and strongly emphasizes the second step. – Question of whether an individual's impairment is a disability should not demand extensive analysis –Now, the primary object of ADA cases is whether employers have complied with their obligations, principally to take reasonable steps to help maintain the employment relationship

11 PCCYFS 2012 Annual Spring Conference 11 Interpreting "Disability" Under ADAAA The previous six-month "transitory" part of the "transitory and minor" exception to "regarded as" coverage does not apply to the definition of disability – the effects of an impairment lasting or expected to last fewer than six months can be substantially limiting and even less than a few months, if it is severe.

12 PCCYFS 2012 Annual Spring Conference 12 ADAAA Changed the Focus of the ADA Broadens scope of protection under the ADA. Expands "Major Life Activity" to include "Major Bodily Functions." Eliminates disability mitigation defense. Covers "Episodic Impairments" and "Those in Remission." Expands the "Regarded As" Provision in the ADA. No longer focus on the issue of "disability." Shifts focus to Interactive Process.

13 PCCYFS 2012 Annual Spring Conference 13 New ADA Regulations The new regulations clarify and expand many of the terms and procedures used to determine whether an individual is disabled: –A "physical or mental impairment" is (1) any physiological disorder or condition, cosmetic disfigurement, or anatomical loss affecting one or more body systems, such as neurological, musculoskeletal, special sense organs, respiratory (including speech organs), cardiovascular, reproductive, digestive, genitourinary, immune, circulatory, hemic, lymphatic, skin, and endocrine; or (2) any mental or psychological disorder, such as an intellectual disability (formally termed "mental retardation"), organic brain syndrome, emotional or mental illness and specific learning disabilities.

14 PCCYFS 2012 Annual Spring Conference 14 New ADA Regulations The term "major life activities" now includes, but is not limited to, caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, sitting, reaching, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating, interacting with others, and "working" … and reproductive functions.

15 PCCYFS 2012 Annual Spring Conference 15 New ADA Regulations In determining whether an impairment "substantially limits" a major life activity, the Regulations provide certain "Rules of Construction": –An impairment is a disability if it substantially limits the ability of an individual to perform a major life activity as compared to most people in the general population; it does not need to prevent or significantly restrict the individual from performing the major life activity. –The determination of whether an impairment substantially limits a major life activity requires an individualized assessment that does not necessarily need to include scientific, medical or statistical data. –The determination of whether an impairment substantially limits a major life activity must be made without regard to the ameliorative effects of mitigating measures (other than ordinary eyeglasses or contact lenses on vision impairments). –An impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active. –A severe impairment that lasts less than three months could be a "disability."

16 PCCYFS 2012 Annual Spring Conference 16 What Does This Mean For Employers? Ensure managers and human resources professionals are trained and provided with guidance on the effect of the Regulations. Employers should assume that all but the most transitory and minor of impairments (e.g., the common cold, seasonal influenza, sprained joints) will be found to be "disabilities." Practically, this should increase employer focus on reasonable accommodation and the interactive process.

17 PCCYFS 2012 Annual Spring Conference 17 Impact of ADAAA Because ADAAA and the regulations relax the ADA's definition of "disability"….. –Fewer dispositive motions on the threshold issue of "disability" are expected to succeed. –Result = more exposure for employers. –Litigation will now focus on the issues of "qualified individual" with a disability; reasonable accommodation", "undue hardship;" and the motivation behind employment actions.

18 PCCYFS 2012 Annual Spring Conference 18 More Attention To Interactive Process More individuals are expected to request accommodation as they become familiar with the ADAAA changes. The EEOC's regulatory impact analysis concludes that 1 million more people may consistently meet the ADAAA's definition of "disability" and, thus, accommodating them may cost employers as much as $235 million per year over the next five years.

19 PCCYFS 2012 Annual Spring Conference 19 New ADA Regulations What Should Employers Do? Because the new regulations materially change how employers handle employees who claim they are disabled and want to receive an accommodation, we recommend that employers take the following steps: –Reassess all ADA procedures and policies to ensure that they recognize the broadened scope of the term "disability" and provide for a meaningful interactive process with the disabled employee as soon as possible. The ADAAA and the Regulations want employers to focus on the interactive process rather than whether an individual is "disabled." –Review all company job descriptions to confirm that they specifically and accurately define the essential functions of each position. –Analyze pre- and post-employment screening and testing to ensure they are job-related and do not adversely affect the broad range of qualified, disabled individuals who will now take part in the screening or testing.

20 PCCYFS 2012 Annual Spring Conference 20 GINA Regulations EEOC issued final regulations that implement employment provisions (Title II) of the Genetic Information Nondiscrimination Act of 2008 (GINA) effective January 10, 2011. Purpose is to prevent use of genetic information and family medical history to be a basis for denial of employment.

21 PCCYFS 2012 Annual Spring Conference 21 GINA Regulations What Does GINA Limit and By Whom? –Employers cannot take adverse action/discriminate based on genetic information. –Employment agencies cannot discriminate. –Labor organization cannot exclude or expel. –No retaliation against employees alleging GINA violation or participating in the investigation of alleged violations. –No harassment because of genetic information.

22 PCCYFS 2012 Annual Spring Conference 22 GINA Regulations What is "genetic information"? –Results of an employee's genetic tests. –Genetic tests of family members of such employee (up to fourth-degree relatives). –Manifestation of a disease or disorder in an employee's family members. –Request for or receipt of genetic services (e.g., genetic counseling). –Participation in clinical research which includes genetic services. –Does NOT include information about the age or sex of any individual.

23 PCCYFS 2012 Annual Spring Conference 23 GINA Regulations What Does GINA Prohibit? –Discrimination based on genetic information. Hiring, discharge, or otherwise discriminating with respect to compensation, terms, conditions or privileges of employment because of genetic information. Limiting, segregating or classifying employees in any way that would deprive or tend to deprive opportunities. –Acquisition of Genetic information. Requesting, requiring or purchasing genetic information with respect to an employee or a family member of the employee.

24 PCCYFS 2012 Annual Spring Conference 24 Six Narrow Exceptions: Six Narrow Exceptions to Ban on Acquisition of Genetic Information: –Inadvertent acquisitions (e.g., manager overhears employee talking about relative's illness). –Genetic information obtained as part of health or genetic services, including wellness programs, offered by employer on a voluntary basis, if specific requirements are met. –Family medical history acquired as part of the certification process for FMLA leave (or leave under state or local law).

25 PCCYFS 2012 Annual Spring Conference 25 Six Narrow Exceptions: Genetic information acquired through commercially and publicly available documents, so long as the employer is not searching with the intent of finding genetic information or accessing sources likely to contain genetic information. Genetic information acquired through genetic monitoring program that monitors biological effects of toxic substances in the workplace. Acquisition of genetic information of employees by employers who do DNA testing for law enforcement purposes as a forensic lab or for purposes of human remains identification.

26 PCCYFS 2012 Annual Spring Conference 26 GINA Resolutions Clarification of Inadvertent Acquisition of Protected Information that does not violate GINA: –Overhearing a conversation. –Making a general inquiry (e.g., "Will your daughter be okay?"). –Unsolicited information. –A social media platform that the employee granted permission to be accessed. –A social media platform that the employee did not grant permission to be accessed.

27 PCCYFS 2012 Annual Spring Conference 27 GINA Regulations Safe harbor language should be used whenever requesting medical information: "The Genetic Information Nondiscrimination Act of 2008 (GINA) prohibits employers and other entities covered by GINA Title II from requesting or requiring genetic information of an individual or family member of the individual, except as specifically allowed by this law. To comply with this law, we are asking that you not provide any genetic information when responding to this request for medical information. 'Genetic information' as defined by GINA, includes an individual's family medical history, the results of an individual's or family member's genetic tests, the fact that an individual or an individual's family member sought or received genetic services, and genetic information of a fetus carried by an individual or an individual's family member or an embryo lawfully held by an individual or family member receiving assistive reproductive services.“-- 29 C.F.R. § 1635.8.

28 PCCYFS 2012 Annual Spring Conference 28 GINA Regulations On February 3, 2012, the EEOC issued a rule mandating employers to retain workplace records in the event they are called upon to demonstrate compliance with GINA. Rule went into effect on April 3, 2012. Employers are required to retain workplace records in the same fashion they are required to under the Civil Rights Act and the ADA. Employers are not required to create new documents; they are simply required to retain those documents it previously kept and which are relevant to a charge of discrimination filed under GINA.

29 PCCYFS 2012 Annual Spring Conference 29 GINA Recommendations: Review procedures and policies to ensure compliance with new regulations. Requests for medical information related to post-offer pre-employment examination, for accommodations under ADAAA, and for fitness-for-duty exams, and requests for leave should use safe harbor provision. Managers, human resources personnel, recruiters and company doctors should ensure that genetic information and family medical history information is not requested and if inadvertently obtained, it is not shared or used.

30 PCCYFS 2012 Annual Spring Conference 30 Retaliation Claims The EEOC received 37,334 charges alleging retaliation in 2011. This represented 37.4% of all Charges received by the EEOC in 2011.

31 PCCYFS 2012 Annual Spring Conference 31 Retaliation Claims In the 2006 case Burlington Northern & Santa Fe Railway Co. v. White, the Supreme Court adopted an expansive definition of "adverse action," making it far easier for plaintiffs to pursue retaliation claims. The Court held that illegal retaliation occurs whenever a manager engages in conduct which has the effect of discouraging a "reasonable employee" from making a discrimination complaint. –e.g., reduction in work assignments and responsibilities.

32 PCCYFS 2012 Annual Spring Conference 32 Retaliation Claims Plaintiffs need not show that the alleged retaliation significantly impacted a term, condition, or benefit of employment.

33 PCCYFS 2012 Annual Spring Conference 33 Retaliation Claims In the 2009 case Crawford v. Metropolitan Gov't of Nashville and Davidson County, the Supreme Court considered how far anti-retaliation protections reach and who can bring retaliation claims. Though the plaintiff admitted she had not been the target of any discrimination, she later brought her own retaliation claim. The plaintiff claimed that her employer had taken adverse action against her because the information she disclosed during an investigation had corroborated another employee's discrimination complaint.

34 PCCYFS 2012 Annual Spring Conference 34 Retaliation Claims The Crawford Court held plaintiffs need not first allege that they suffered discrimination before claiming that they suffered retaliation. The Court held that the act of reporting inappropriate behavior during the investigation constituted protected action. Accordingly, adverse action taken in response to such reporting could constitute retaliation. On remand for further proceedings, the plaintiff was awarded $1.5 million.

35 PCCYFS 2012 Annual Spring Conference 35 Retaliation Claims For the third time in five years, the United States Supreme Court ruled on a claim of unlawful retaliation in the employment discrimination context: On January 24, 2011, the Court handed down its decision in Thompson v. North American Stainless, LP, No. 09-291, U.S. Supreme Court (January 24, 2011). Notably, this decision also marks the third consecutive time the Supreme Court has sided with aggrieved employees and expanded their retaliation protections.

36 PCCYFS 2012 Annual Spring Conference 36 Retaliation Claims In Thompson, the Court considered whether the fiancée of an employee who filed a sexual discrimination claim against the company, could bring a claim of unlawful retaliation when he was fired by that same employer three weeks later. Eric Thompson and his fiancée Miriam Regalado were both employees of North American Stainless. Regalado filed a sex discrimination charge with the EEOC and the employer fired Thompson three weeks later.

37 PCCYFS 2012 Annual Spring Conference 37 Retaliation Claims The Court unanimously ruled that Thompson, who had not participated in the investigation of Regalado's sexual discrimination claim, could bring a claim of retaliation even though he wasn't the one who brought the underlying sexual discrimination claim. The Court concluded that it is "obvious that a reasonable worker might be dissuaded from engaging in protected activity if she knew that her fiancée would be fired." The Court held that Thompson should be protected and could bring his own retaliation claim.

38 PCCYFS 2012 Annual Spring Conference 38 Whistleblower Claims Employees who complain about illegal conduct or unsafe work conditions can later claim to be whistleblowers. It is very difficult to obtain summary judgment on whistleblower claims. The False Claims Act prohibits employers from knowingly making false statements to or engaging in fraudulent conduct towards the federal government for the purpose of obtaining payment from the federal government. Many statutes permit for retaliation claims or whistleblower claims even outside the discrimination context (FLSA, OSHA, PA Whistleblower Law).

39 PCCYFS 2012 Annual Spring Conference 39 Whistleblower/Retaliation Claims Keys to avoiding whistleblower/retaliation claims. –Document every complaint and the company's response. –Document whether the complaint had any validity. –Apply the same standards to the complaining employee as are applied to all others. –Make sure that the reasons for any subsequent disciplines are well documented. –Adopt strong anti-retaliation policies and communicate them regularly. –Train your managers.

40 PCCYFS 2012 Annual Spring Conference 40 Fair Labor Standards Act The FLSA establishes minimum wage, overtime pay, recordkeeping, and child labor standards affecting full-time and part-time workers in the private sector and in Federal, state, and local governments. The Act provides for minimum standards for both wages and overtime entitlement, and spells out administrative procedures by which covered work time must be compensated. It also exempts specified employees or groups of employees from certain provisions.

41 PCCYFS 2012 Annual Spring Conference 41 Fair Labor Standards Act Increased enforcement. –In 2010, the DOL collected more than $175,652,665 in back wages. Collective action explosion. –Parallel Class Actions. –Targeted by Plaintiffs' Firms. –2010 = 6,081 FLSA lawsuits filed in U.S. Federal Courts. 2011 = 7,008 FLSA lawsuits filed in U.S. Federal Courts.

42 PCCYFS 2012 Annual Spring Conference 42 Fair Labor Standards Act Unless employers have made this a priority in the last five (5) years, they are probably at risk. Magnitude of risk not properly assessed or appreciated. Counterintuitive. Litigation – few easy exits – costly.

43 PCCYFS 2012 Annual Spring Conference 43 Fair Labor Standards Act Exempt v. non-exempt: –Administrative, professional and executive –Minimum salary – $455 per week. Actual job duties matter more than job descriptions. Look out for industries and positions subject to recent challenge.

44 PCCYFS 2012 Annual Spring Conference 44 Fair Labor Standards Act Administrative: –Primary duty of performing "office or nonmanual work directly related to the management or general business operations of the employer or the employer's customers"; and –Have a primary duty that "includes the exercise of discretion and independent judgment with respect to matters of significance.

45 PCCYFS 2012 Annual Spring Conference 45 Fair Labor Standards Act Professional: –Three types of exempt professionals: "Learned" - The employee's primary duty must involve work requiring advanced knowledge (customarily acquired by a prolonged course of specialized intellectual study) in a field of science or learning. "Artistic" or "Creative"; and "Teachers."

46 PCCYFS 2012 Annual Spring Conference 46 Fair Labor Standards Act Professional: –Requisite knowledge not obtained at high school level. –Fact intensive analysis – title doesn't matter. –Exempt: airline pilot, benefit plan practitioner, pharmacists, engineer, architect, chef, registered nurse, physicians' assistant (maybe), registered or certified medical technologist, dental hygienist (maybe). –Not Exempt: probation officer, legal analyst, paralegal, news reporter, insurance claim adjuster, certain field engineer, avionics technician, medical transcriptionist, paramedic, x-ray technician, licensed practical nurse.

47 PCCYFS 2012 Annual Spring Conference 47 Fair Labor Standards Act Executive: –Manage the enterprise or a customarily recognized department or subdivision; –Customarily and regularly direct the work of two or more; and –Authority to hire and fire other employees, or make suggestions and recommendations that are given particular weight as to hiring, firing, advancement, promotion, or other changes in status.

48 PCCYFS 2012 Annual Spring Conference 48 Fair Labor Standards Act – A Few Hot Issues On-Call Time: –Blackberry, cell phone and remote computer access: Time spent responding = work time Do not ignore obvious work If so restrictive – whole "on call" time may be work –Consider who really needs devices. –Train employees on boundaries for contacting other employees while "off the clock."

49 PCCYFS 2012 Annual Spring Conference 49 Fair Labor Standards Act – A Few Hot Issues Meal Breaks: –Hot issue in collective actions –Be observant –Consider paid lunches –Get workers away from work space –Beware of processes that make automatic deductions for meal breaks

50 PCCYFS 2012 Annual Spring Conference 50 Fair Labor Standards Act – A Few Hot Issues Non-Exempt Travel: –All time spent traveling during employee's workday is compensable –Overnight travel time outside of regular working hours is compensable if driving. –Overnight travel time outside of regular working hours is not compensable if traveling as a passenger on an airplane, train, boat, bus or automobile

51 PCCYFS 2012 Annual Spring Conference 51 Fair Labor Standards Act – Why It Matters Collective/Class Actions –Immediacy –Exposure Wal-Mart Stores, Inc.: 187,000 employees/$187 million verdict for missed breaks/off-the-clock work Top 10 settlements in private litigation in 2010, $1.16 billion –Settlement Future potential class members/lawsuits Need Secretary of Labor or court approval Rarely confidential

52 PCCYFS 2012 Annual Spring Conference 52 Fair Labor Standards Act – Why It Matters Damages –Two years –Extended to 3 years if reckless disregard –Liquidated damages Must be assessed unless defendant can show it acted in good faith and with reasonable grounds –Attorneys' fees –No guarantee it's over

53 PCCYFS 2012 Annual Spring Conference 53 Fair Labor Standards Act – Why It Matters Personal Liability –"Any person acting directly or indirectly in the interest of an employer in relation to the employee" –An owner, officer, director, participating shareholder, manager, or supervisor may be subject to liability where he or she was responsible in whole or in part for the alleged violation –Potential criminal liability for willful violations

54 PCCYFS 2012 Annual Spring Conference 54 Fair Labor Standards Act – Why It Matters Presumption –Employer bears the burden of establishing the applicability of exemptions –Effect of inadequate or inaccurate records No insurance –Generally, EPLI coverage does not apply FLSA claims

55 PCCYFS 2012 Annual Spring Conference 55 USERRA Update In Serricchio v. Wachovia Securities, LLC, 10- 1590 (2d Cir. September 13, 2011) the Second Circuit affirmed a district court award of $1.64 Million under the Uniformed Services Employment and Reemployment Rights Act ("USERRA") to a returning servicemember and ordered his reinstatement to the position of financial advisor at a salary higher than the salary he enjoyed pre-deployment. The court held that Wachovia's offer to Serricchio of a position with the same commission rate as his pre-service position, but without regard to the actual pay he received based on the volume and size of the accounts he managed before his military leave, was insufficient to satisfy USERRA's reinstatement obligations.

56 PCCYFS 2012 Annual Spring Conference 56 USERRA Update In another issue of first impression, the appellate court in Serricchio ruled that the district court below did not abuse its discretion in ordering Wachovia to reinstate Serricchio to a financial adviser position at a salary of $12,300 per month for 12 months even though his pre- service compensation was "wholly commission-based." The Serricchio decision will likely have a significant impact on USERRA cases in the immediate future, as the ongoing draw- down in Iraq continues and more servicemembers return from active duty at a time when the United States economy is suffering and businesses struggle.

57 PCCYFS 2012 Annual Spring Conference 57 Unemployment Discrimination Creates a new "Protected Class." Similar to Title VII – would only apply to employers with fifteen (15) or more employees and would be investigated by the EEOC. This would have a significant impact on the hiring process as it would effectively allow any and all applicants to sue if they are not hired.

58 PCCYFS 2012 Annual Spring Conference 58 Questions? THANK YOU


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