By Erin Dougherty Foley and John P. Phillips

Seyfarth Synopsis: A recent decision out of the U.S. District Court for the District of Columbia serves as a helpful reminder on the difficulties of maintaining privilege during internal company investigations.  But with a clear understanding of the limitations of the attorney-client privilege, thoughtful preparation of the investigation’s goals, and pro-active planning, employers can put themselves in the best possible position to control what information becomes public and maintain work-product and attorney-client privileges.

When conducting an internal investigation, every in-house counsel pays particular attention to maintaining privilege throughout the investigation. But maintaining privilege can be very difficult.  A recent decision from the U.S. District Court for the District of Columbia tackles this issue, and it provides useful lessons for helping to ensure that confidential and privileged internal investigation notes and reports remain confidential and privileged.

Background on the Case

In Banneker Ventures, LLC v. Graham, the U.S. District Court for the District of Columbia ordered the production of 51 interview memoranda prepared by an outside law firm during an internal company investigation. The Washington Metropolitan Area Transit Authority (WMATA) had been in negotiations with Banneker Ventures, LLC over a development project.  When negotiations broke down, Banneker’s attorney sent a letter to WMATA outlining what Banneker believed to have been improper actions on the part of WMATA and its Board of Directors.  WMATA briefly responded to the letter, but did not reopen negotiations on the project.

After more than two years, WMATA retained an outside law firm to conduct an investigation into the actions of WMATA’s Board in connection with the project. The investigation took approximately five months, included interviews of 34 individuals (including 19 current or former WMATA Board members or employees), and resulted in the drafting of 51 interview memoranda.  These memos were created by the outside attorneys conducting the investigation, and they were marked “attorney work product.”

In addition, the outside law firm prepared an investigative report for WMATA, which included references to and citations from the interview memoranda. The WMATA Board subsequently voted to publicly release the investigative report, but the Board did not release any of the 51 interview memos.

Banneker eventually sued WMATA for breach of contract and other claims, and during discovery, Banneker sought all 51 of the interview memos. After considering whether the memos were protected by the attorney work-product doctrine or the attorney-client privilege, the court ordered WMATA to produce the memos.

The Court’s Reasoning

The Court first addressed whether the interview memoranda were protected attorney work-product. To be work-product, they must have been prepared “in anticipation of litigation or for trial.”  The Court looked at the time between Banneker’s letter to WMATA and the start of the investigation, and it tried to ascertain the intent behind the investigation.  WMATA argued that Banneker’s letter caused it to believe litigation was probable.  Although not articulating any specific amount of time, the Court found that the more than two years between the letter and the start of the investigation was too long for the investigation to have any link to the letter sent by Banneker’s attorney.  In addition, the Court reasoned that the interview memos would have been created in the ordinary course of business, with or without litigation.  The WMATA Board had stated that the investigation was to formulate and recommend changes to policies, standards, and procedures; the Court said this was a business—not litigation—goal.  And the Court concluded that none of the interview memos were protected by the attorney work-product doctrine.

The Court next addressed the attorney-client privilege. To be privileged, the documents must have been “confidential communications between attorneys and their clients made for the purpose of obtaining or providing legal advice.”  The interview memos clearly fit this criteria.  However, Banneker argued that WMATA had waived the attorney-client privilege for the interview memos when it publicly released the investigative report.  The Court agreed, reasoning that the report and the memos concerned the same subject matter and the report cited extensively to the memos, even containing references to at least 23 different witness interviews.  The Court also explained that WMATA could not use the investigative report to its advantage during litigation while withholding the remaining information in the interview memos (this invokes the old maxim that a party cannot use privileged information both as a sword and a shield).  But the Court did give WMATA some relief, allowing WMATA to redact any information from the interview memos on subjects that were not included in the investigative report.  In other words, by publicly releasing the report, WMATA had only waived privilege on the subject matters that were actually contained in the public report.

Takeaways and Best Practices

This decision can serve as a useful reminder to both in-house attorneys and outside counsel on the importance of carefully planning all internal investigations. Following are some tips to assist employers when conducting internal investigations.

  1. Clearly articulate the reasons for and the goals of the investigation. Often investigations, such as workplace harassment and other company investigations, are conducted for multiple purposes. When the investigation is conducted in anticipation of litigation, that reason should be clearly articulated. Management directing the investigation and the individuals conducting the investigation—whether in-house attorneys or outside counsel—should clearly understand the reasons for and the goals of the investigation.
  2. Expect interview notes to be discoverable. Remember that privilege does not attach to underlying facts. In many cases, interview notes will be discoverable in a subsequent lawsuit. Accordingly, interview notes should contain only clear statements of facts and information gathered during the interview. It is important to thoroughly train the interviewers to include only appropriate information in their notes, especially if the company is conducting the investigation itself.
  3. Prepare an Executive Summary. An executive summary can provide a broad overview of the investigation and its results, while at the same time protecting confidential and privileged information that should be reserved to a more select audience. When preparing an executive summary, carefully scrutinize the amount of detail necessary and consider whether citation or detailed discussion of the underlying investigation documents is necessary.
  4. Consider whether a public or more general release serves the company’s purposes. Be especially careful when releasing information or conclusions gathered during the investigation to anyone outside of the organization. As the Banneker case makes clear, public disclosure can result in waiver of the attorney-client privilege. Remember that this may also include disclosure to government agencies or other third-parties. If some disclosure is necessary, consider whether a confidentiality agreement or a joint-defense agreement serves the company’s interest.
  5. Maintain realistic expectations. Finally, no amount of planning can guarantee that an investigation will not become public. Remember that anything created during an investigation may become public. Accordingly, handle all communications, notes, and any other documents created during the investigation with this in mind.

Internal investigations are a necessary part of any company’s business, and this recent decision can serve as a helpful reminder of the importance of thoroughly planning any investigation. By knowing the rules relating to privilege and pro-actively planning any internal investigation, employers can put themselves in the best possible position to control what information becomes public and maintain work-product and attorney-client privileges.

For more information on this topic, please contact the authors, your Seyfarth Attorney, or any member of Seyfarth Shaw’s White Collar, Internal Investigations, and False Claims Team or the Labor & Employment Team.

By Kevin A. Fritz

Seyfarth Synopsis: A former employee’s social media activities were not “solicitations” that breached his employment non-solicitation agreement where no suggestion to join the former employee was apparent from the activity.

Employers often wonder how far a non-solicitation agreement can go. It can frustrate employers, who may pay extra money for an employee to sign a non-solicitation agreement, to later learn that their former employees have violated such agreements.  And with the rise of social media, and its convergence into the business realm, potential violations through communications between current, prospective, and even previous employees have become more complicated than ever.  A recent Illinois appellate court recently considered the complex nature of these communications in the form of a LinkedIn invite.

What’s in a message?

In Bankers Life & Casualty Co. v. American Senior Benefits, LLC, No. 1–16–0687, 2017 IL App (1st) 160687-U (1st Dist., June 26, 2017), Bankers Life hired a branch sales manager who signed a non-solicitation agreement.  Part of the agreement required the manager not to solicit Bankers Life employees after he left the company.  Suffice it to say, the manager left the company, and according to Bankers Life, the past employee “recruited or attempted to recruit Bankers Life employees and agents from the Warwick, Rhode Island office, by sending LinkedIn requests to connect to three employees.” Once connected on LinkedIn, the three employees clicked on the former sales manager’s LinkedIn profile and saw that American Senior Benefits had open positions as the advertisement was posted on the former employee’s profile.

The question before the Appellate Court was whether an LinkedIn invitation to connect can be considered an attempt to solicit employees in violation of a non-solicitation agreement. The former sales manager moved for summary judgment, claiming that merely inviting one to connect on LinkedIn is not a prohibited solicitation, in contravention to the non-solicitation agreement. The sales manager put forward evidence to show that he did not send any direct messages to the three Bankers Life employees, but simply sent the standard LinkedIn request message that the three employees form a professional connection with him through the business social media platform.

The Appellate Court agreed and upheld the grant of summary judgment in favor of the former employee. The court found dispositive the fact that the “invitations to connect via LinkedIn were sent from [the employee]’s LinkedIn account through generic emails that invited recipients to form a professional connection. The generic emails did not contain any discussion of Bankers Life, no mention of [his new employer], no suggestion that the recipient view a job description on [the employee]’s profile page, and no solicitation to leave their place of employment and join [his new employer].”

Indeed, it did not even matter to the court that the employee’s page on LinkedIn had a job posting for his new employer. Rather, , what mattered to the court was that upon receiving the e-mails, the Bankers Life employees had the option of responding to the LinkedIn requests to connect. The court noted that where the substance of a LinkedIn communication revealed an invitation to apply for a position, such communication could rise to the level of a solicitation.

Employer Takeaway

While the decision is not binding authority on other Illinois courts, its rationale is poignant and will likely be used in future decisions. With any form of communication – whether it be LinkedIn, Facebook, Twitter, e-mail, or the next wave of social media enterprise – it is often less important how that information is communicated, but rather it is what is communicated that matters. If the substance of the message gives rise to a solicitation, it won’t matter if it is less than 140 characters, a temporary 10 second Snapchat, or even a LinkedIn request message.

For more information on this topic, please contact the author, your Seyfarth Attorney, or any member of the Firm’s Labor & Employment Team.

By Brent I. Clark, Erin Dougherty Foley, and Craig B. Simonsen

Seyfarth Synopsis: DOT has withdrawn its rulemaking on safety sensitive positions in highway and rail transportation.

This week the U.S. Department of Transportation has withdrawn its March 10, 2016 Advance Notice of Proposed Rulemaking (ANPR) on the Evaluation of Safety Sensitive Personnel for Moderate-to-Severe Obstructive Sleep Apnea (OSA). 82 Fed. Reg. 37038 (Aug. 8, 2017).

The News Release indicates that “the Agencies have determined not to issue a notice of proposed rulemaking at this time and believe that current safety programs and Federal Railroad Administration’s (FRA) rulemaking addressing fatigue risk management are the appropriate avenues to address OSA.”  Emphasis added.

The ANPR had been directed at individuals occupying “safety sensitive positions” in highway and rail transportation, and on its potential consequences for the safety of rail and highway transportation. The DOT’s Agencies, the Federal Motor Carrier Safety Administration (FMCSA) and the FRA, through the rulemaking, were requesting data and information from employers and the public concerning the prevalence of moderate-to-severe obstructive sleep apnea among those employees in those positions.

The DOT had defined obstructive sleep apnea as a “respiratory disorder characterized by a reduction or cessation of breathing during sleep. OSA is characterized by repeated episodes of upper airway collapse in the region of the upper throat (pharynx) that results in intermittent periods of partial airflow obstruction (hypopneas), complete airflow obstruction (apneas), and respiratory effort-related arousals from sleep (RERAs) in which affected individuals awaken partially and may experience gasping and choking as they struggle to breathe.”

The ANPR stated that risk factors for developing OSA included: obesity, male gender, advancing age, family history of OSA, large neck size, and an anatomically small oropharynx (throat). Additionally, OSA was associated with increased risk for other adverse health conditions such as: “hypertension (high blood pressure), diabetes, obesity, cardiac dysrhythmias (irregular heartbeat), myocardial infarction (heart attack), stroke, and sudden cardiac death.

The withdrawal of this rulemaking may save employers in these industries perhaps considerable efforts and costs, although familiarity with the ANPR and comments received on the rulemaking may be worthwhile.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Workplace Safety and Health (OSHA/MSHA) or Labor & Employment Teams.

 

By Gerald L. Maatman, Jr. and Alex W. Karasik

Seyfarth Synopsis: In an EEOC lawsuit alleging that an employer failed to reasonably accommodate its Muslim employees’ requests for prayer breaks, a federal court in Colorado granted the EEOC’s motion for sanctions — as a result of the employer’s failure to preserve and produce various records — and barred the employer from presenting evidence, testimony, or arguments that unscheduled prayer breaks led to production line slowdowns or stoppages.  This ruling provides an important lesson for businesses regarding the preservation of documents in ongoing EEOC litigation.

***

In EEOC v. JBS USA, LLC, Case No. 10-CV-02103, 2017 U.S. Dist. LEXIS 122908 (D. Colo. Aug. 4, 2017), the EEOC alleged that JBS USA, LLC (“JBS”), a meat packing company, discriminated against its Muslim employees on the basis of religion by engaging in a pattern or practice of retaliation, discriminatory discipline and discharge, harassment, and denying its Muslim employees reasonable religious accommodations.  After the EEOC moved for sanctions regarding JBS’s failure to produce two types of records relating to delays on JBS’s production line, Judge Phillip A. Brimmer of the U.S. District Court for the District of Colorado granted in part the EEOC’s motion and barred JBS from presenting evidence, testimony, or argument in its motions, at hearings, or at trial that unscheduled prayer breaks led to production line slowdowns or stoppages.

For employers involved in government enforcement litigation, this ruling serves as a cautionary tale regarding the importance of preserving and producing relevant records, and that the failure to do so might cost employers the ability to later use such records in their defense.

For more information on this lawsuit (and a similar Nebraska case where JBS successfully obtained summary judgment), see our blog posts here, here, here, here, here, here, and here.

Case Background

JBS operates a beef processing plant in Greeley, Colorado.  Id. at *2.  During the first week of Ramadan 2008, a dispute occurred between JBS and its Muslim employees over their opportunities to pray, resulting in hundreds of Muslim employees walking off the job.  On September 10, 2008, JBS fired 96 Muslim employees that refused to return to work.  After the mass termination, numerous former employees filed discrimination charges with the EEOC.  Id.  In response, on February 3, 2009, JBS submitted a position statement where it argued that granting prayer breaks to employees would be an undue burden, in part, due to losses resulting from “each minute of production down-time.”  Id.  JBS continued to assert its undue burden affirmative defense throughout the case, for instance, arguing in its summary judgment motion that production line slowdowns and downtime would have been caused by allowing prayer breaks to Muslim employees.

The EEOC sought discovery from JBS about its undue burden affirmative defense.  Relevant here, on November 21, 2012, the EEOC served a production request regarding the production of all reports or data showing all dates and times the fabrication lines on any and all shifts were stopped, as well as the speed of the lines.  In response, JBS produced documents that included records showing scheduled breaks, but did not provide or reference the Down Time Reports or Clipboards, which show unplanned downtime and slowdowns.  The EEOC thereafter moved for sanctions for the loss or destruction of documents directly relevant to JBS’s allegations of undue hardship.

The Court’s Decision

The Court granted the EEOC’s motion for sanctions.  While JBS had produced Clipboards from 2012-2016 and Down Time Reports from 2016, it claimed that all others had been destroyed.  JBS later testified via Rule 30(b)(6) deposition that the Down Time Reports were shipped to storage each year, but may have been destroyed.  After searching its warehouse for “a day” in 2017,  JBS later located and produced some additional records.  Id. at *6.  The Court thus found that JBS failed to supplement its production with responsive records in a timely manner.  The Court held that because JBS did not show that its failure to supplement was substantially justified or harmless, it would impose sanctions pursuant to Fed. R. Civ. P. 37(c)(1).  Id.

Next, the Court explained that spoliation occurs when a party loses or destroys evidence that it had a duty to preserve because it was relevant to proof of an issue at trial in current or anticipated litigation.  Id. at *7 (citation omitted).  JBS argued that it did not have a duty to preserve these documents because it had no way of knowing or anticipating that the EEOC would be interested in knowing the specific time of every instance of every day that the production line stopped for an unplanned or unexpected reason.  The Court rejected this argument, holding that JBS ignored the fact that it asserted an undue burden defense within a year of the September 2008 incident and after charges of discrimination had been filed against it.  As such, the Court held that JBS had a duty to preserve documents relevant to the burden posed by the proposed accommodations.  Id. at *8 (citation omitted).

Arguing that the lack of production of records did not cause a prejudice to the EEOC, JBS stated that the records did not show whether any slowdown or stoppage was related to a prayer break because the information they contained was “only as specific as the information known to the person filling out the Down Time Report.”  Id. at *10.  The Court rejected this argument, holding that “[r]ecords such as those sought, which potentially show the actual impact of unscheduled employee prayer breaks, are particularly important to understanding the impact such breaks would have on production line slowdowns or stoppages because they would provide contemporaneous records of whether unscheduled breaks led to production downtime.”  Id. at *12.  Accordingly, the Court found that the EEOC was prejudiced by JBS’s spoliation of evidence.  Id.

In fashioning a sanction that “appropriately addresses the prejudice to the EEOC resulting from JBS’s spoliation or failure to produce the records and is proportional to JBS’s culpability,” the Court held that it would bar JBS from presenting evidence, testimony, or argument in its motions, at hearings, or at trial that unscheduled prayer breaks led to production line slowdowns or stoppages.  Id. at *14.  The Court explained that this sanction was “tailored to the evidence lost, destroyed, or withheld by JBS because it alleviates the prejudice which the EEOC would otherwise suffer, namely, that JBS may present evidence of stoppages through witnesses, but the EEOC would not be able to rebut such testimony with records that would likely prove whether stoppages actually occurred and, perhaps, for what reason.”  Id.  Accordingly, the Court granted in part the EEOC’s motion for sanctions for the loss or destruction of documents.

Implications For Employers

An employer’s likelihood of defeating a workplace class action is often dependent on its ability maintain and preserve thorough employment records.  Here, the employer’s failure to preserve records that ultimately could have helped establish an affirmative defense resulted in the Court limiting the employer from using certain types of evidence in its defense of the litigation.  This sanction should serve as a cautionary tale for employers in regards to complying with the written discovery process, as employers are best-positioned to defeat workplace class actions when they have as many defenses as possible in their arsenal.

Readers can also find this post on our EEOC Countdown blog here.

 

By Erin Dougherty Foley, Ashley K. Laken, and Craig B. Simonsen

Seyfarth Synopsis: According to the EEOC in this just filed lawsuit, a home care services provider in North Carolina violated federal disability rights law when it rejected telecommuting requests from an employee whose asthma and COPD “made her sensitive to workplace smells.” 

Earlier this month, the Equal Employment Opportunity Commission filed suit against a home healthcare company to “correct unlawful employment practices on the basis of disability.”  In the complaint, filed in EEOC v. Advanced Home Care, Inc., No. 1:17-cv-00646 (M.D.N.C. July 12, 2017), the EEOC alleges that Advanced Home Care, Inc. refused to provide Elizabeth Pennell, a “qualified individual with a disability,” with a reasonable accommodation, and discharged her in violation of the Americans with Disabilities Act.

According to the EEOC, Pennell was a case manager for patients requiring home services. As a case manager, Pennell was required to spend part of her day on telephone calls. In 2015, Pennell began to experience frequent asthma attacks and flare-ups of bronchitis.  After collapsing at work after a heavy bout of coughing, she was hospitalized where she was diagnosed with chronic bronchitis and COPD.

The complaint alleges that as a “consequence of asthma, bronchitis, and COPD, Pennell experiences wheezing, severe bouts of coughing, and asthma attacks,” and that Pennell’s physical impairments “substantially limit her in the major life activity of breathing. . . and constitute a disability under the ADA.” The EEOC alleges that scents and odors aggravate Pennell’s COPD and asthma, that she worked in a cubicle in close proximity to hundreds of other employees, and that she was therefore subjected to these types of irritants, including the smell of smoke on other employees’ clothes.

The EEOC claims that Pennell’s supervisor “ignored Pennell’s repeated requests to telework” and that teleworking would have allowed Pennell to be away from actual and potential respiratory irritants. The EEOC also claims that Pennell’s supervisor told her she would terminated if she could not return to work without restrictions.  The complaint alleges that Pennell could have performed the essential functions of her position with the reasonable accommodation of telework.  The EEOC also claims that as a consequence of Pennell’s disability, she had difficulty talking continuously for extended periods of time, and if she had been allowed to telework, she would not have been required to take inbound calls and therefore would have spent less time on the phone.

Employers should note that this scenario is somewhat unusual but that telecommuting has been an issue on the EEOC’s radar for the last several months (i.e., is working from home a reasonable accommodation?). Right how we only have the EEOC’s allegations and no response from the employer.  (We’ll be keeping an eye on this litigation to see how it plays out.)  However, the critical take away (regardless of how the employer responded) is the proper handling and response to employee accommodation requests.  Company policies and procedures as well as internal manager training systems for these sorts of requests and responses should be well set out and diligently followed.

For more information on this topic, please contact the author, your Seyfarth Attorney, or any member of the Firm’s Absence Management and Accommodations Team.

Just a reminder that until July 30, 2017, voting is open for the American Bar Association’s annual 100 Best Legal Blogs competition, though this year the contest is a “Web 100” and will include websites and social media along with legal blogs. We hope you will cast your vote today to help Seyfarth’s Employment Law Lookout blog get on the ABA’s list for 2017.

The Employment Law Lookout Blog is a resource for employers seeking intelligent discourse and updates on the today’s most pressing workplace issues. Our mission is two-fold: to provide critical, real-time updates on employment law matters to in-house counsel and HR executives, and to keep our audience apprised of new trends and developments on the horizon.

Seyfarth’s bloggers draw upon their own first-hand experiences counseling businesses large and small to provide you with their insights about the most cutting-edge issues on new regulations, guidance, and court decisions.

Help us gain some extra recognition by casting your vote in the ABA’s Web 100 competition!

Click here to vote. Simply provide a short explanation of why you like this blog.

The deadline to nominate the blog is Sunday, July 30, 2017, so don’t delay. Polls are open!

By Anthony CalifanoAriel D. CudkowiczJohn Ayers-Mann, and Frederick T. Smith

Seyfarth Synopsis: On May 23, 2017, in Callaghan v. Darlington Fabrics Co., a Rhode Island Superior Court issued a unique decision regarding employer obligations to medical marijuana users.

The Judge who penned the decision began his analysis by quoting a 1967 lyric from The Beatles’ song “With A Little Help From My Friends”: “I get high with a little help from my friends.”  In the 32-page opinion followed this witty opening, the Court held that an employer’s refusal to hire an individual based on her medical marijuana use violated Rhode Island’s medical marijuana statute, and the employer’s conduct may have amounted to disability discrimination under the Rhode Island Civil Rights Act (“RICRA”).

The Plaintiff, Christine Callaghan, applied for a position as an intern with Darlington Fabrics.  During her interviews, she disclosed to the company that she used medical marijuana and would test positive for it in her pre-employment drug test.  The company refused to hire her.  Callaghan filed a complaint alleging disability discrimination under the RICRA and seeking a declaratory judgment that the company’s refusal to hire her based on her medical marijuana use violated the Hawkins-Slater Act–Rhode Island’s medical marijuana statute.  Like its counterparts in numerous other states, the Hawkins-Slater Act prohibits an employer from refusing to employ “a person solely for his or her status as a [medical marijuana] cardholder.”

The Court addressed two primary questions. The first question was whether the Hawkins-Slater Act creates a private right of action that allows an individual to file a lawsuit in court for alleged violations of the statute.  The second question was whether a refusal to hire an applicant based on medical marijuana use could amount to disability discrimination under the RICRA.  The Court answered yes to both questions.

Addressing the private right of action question, the Court acknowledged that the Hawkins-Slater Act does not contain any express language authorizing an individual to sue an employer for violation of the statute.  The Court also acknowledged the general principle against assuming that a private right of action exists when the legislature chose not to create one.  On the other hand, the Court also recognized the legal principle that a court should not attribute to the legislature an intent to enact a meaningless statute.  Ultimately, the Court concluded that the Hawkins-Slater Act would be meaningless if it does not allow a private person to sue an employer for violating the statute.  Thus, the Court held that an implied private right of action exists under the Hawkins-Slater Act, and the employer violated the law by refusing to hire Callaghan because of her medical marijuana use.  In so holding, the Court rejected the notion that there is a meaningful distinction between a medical marijuana “cardholder” and a medical marijuana “user.”  The Hawkins-Slater Act, according to the Court, protects medical marijuana cardholders who use marijuana because a physician has recommended it. The Court therefore granted a declaratory judgment in Callaghan’s favor.

As for Callaghan’s claim of disability discrimination under the RICRA, the employer moved for summary judgment on several grounds.  The company argued, relying on the Americans with Disabilities Act, that active drug use is not a disability. The Court rejected this argument, reasoning that the RICRA defines disability more broadly than the Americans with Disabilities Act.  It also reasoned that an individual must have a “debilitating medical condition” to qualify as a cardholder under the Hawkins-Slater Act.  Accordingly, the employer could have inferred that Callaghan was disabled, and thus, could have discriminated against her on that basis.

The Court also rejected the employer’s argument that Callaghan was not a “qualified individual” with a disability because she engaged in the use of illegal drugs.  The Court concluded that, unlike other disability discrimination laws, the RICRA does not protect only “qualified individuals” with disabilities, but rather all persons with disabilities.  Thus, the Court concluded that the employer’s defense was inapplicable to Callaghan’s claims.

Perhaps most notably, the Court rejected the employer’s argument that the federal Controlled Substances Act (“CSA”), which classifies marijuana as an illegal drug, preempts the Hawkins-Slater Act.  The Court reasoned that the CSA is not intended to preempt state law unless it is in positive conflict with the CSA.  Because the Hawkins-Slater Act does not require the employer to violate the CSA, the Court held that the CSA does not preempt the Hawkins-Slater Act.

In light of its conclusions, the Court denied the employer’s motion for summary judgment on Callaghan’s disability discrimination claim under the RICRA.  Callaghan did not more for summary judgment in her favor on this claim, but the Court observed that “but for [Callaghan’s] disability–which her physician has determined should be treated by medical marijuana–[Callaghan] seemingly would have been hired for the internship position.”

While the Callaghan decision is not binding on any other courts, it is noteworthy.  It goes against the weight of authority from courts in other states in its analysis of the interplay between medical marijuana and anti-discrimination laws.  More importantly, it does so in a way that could require many employers with operations in Rhode Island (and perhaps other states) to change their policies regarding the hiring and continued employment of medical marijuana users.  If appealed, will the decision hold up?  Will other courts in other states issue similar decisions?  Time will tell.

 

By Dawn Reddy Solowey

Seyfarth Synopsis: A recent decision by a federal district court in Minnesota held that a religious accommodation request is not “protected activity” under Title VII.  In defending retaliation litigation, employers should consider whether there is a viable argument that a request for religious accommodation is not sufficient to establish protected activity as a matter of law.  Employers considering requests  for religious accommodation should, despite this decision, proceed carefully when considering the request.

In a recent blog post, we wrote about a federal case pending in Minnesota, where an employer had challenged guidance from the Equal Employment Opportunity Commission (EEOC) and taken the position that a religious accommodation request does not meet the test for protected activity under Title VII as a matter of law.  On July 6, 2017, the Court ruled, and agreed with the employer.

Case Background

The case is EEOC v. North Memorial Health Care, Civ. No. 0:15-cv-3675, in the U.S. District for the District of Minnesota.  The EEOC sued the employer hospital, claiming that the employer had retaliated against an applicant by withdrawing a conditional job offer because she asked for a scheduling accommodation for her religious beliefs as a Seventh Day Adventist.  On March 15, 2017, the employer moved for summary judgment.  The employer argued that the retaliation claim failed on grounds including that a religious accommodation request did not amount to protected activity as a matter of law.

What Did the Court Rule?

The Court sided with the employer, holding that a religious accommodation request is not protected activity.

The Court noted that as far as the Court and parties were aware, no court in the 8th Circuit had decided whether requesting a religious accommodation is a protected activity under Title VII.  The Court reasoned that it must interpret Title VII according to its plain language.  Title VII provides for two categories of protected activity: (1) opposing any practice that violates Title VII; and (2) making a charge, testifying, assisting, or participating in any manner in an investigation, proceeding, or hearing under Title VII.  Applying that plain language, the Court concluded that “requesting a religious accommodation is not a protected activity.”

The Court noted that the plaintiff had not “opposed” any practice, since there was no evidence she communicated to the employer that its denial of her accommodation request was unlawful.  “In other words, merely requesting a religious accommodation is not the same as opposing the allegedly unlawful denial of a religious accommodation,” the Court stated.

Similarly, plaintiff had not made any charge, testified, or assisted in any investigation, proceeding or hearing prior to the revocation of her offer.  Thus, “the court is unable to fit [the employee’s] accommodation request within the plain language of the statute.”

The Court declined to extend to Title VII the reasoning of an 8th Circuit case that had held that requesting a disability accommodation was protected activity under the Americans with Disabilities Act (ADA).  In addition to noting that the 8th Circuit ADA case had itself been questioned, the Court noted key differences between the language of ADA and that of Title VII.

The Court also held that the EEOC’s guidelines, which advise that requesting accommodation is protected activity under Title VII, are “unpersuasive.”

What Does This Case Signal for Employers Defending Retaliation Litigation?

In defending retaliation litigation, an employer should consider whether, in the relevant jurisdiction, there is a viable argument that a request for religious accommodation is not sufficient to establish protected activity as a matter of law.  The Court’s decision in this case cites to federal cases that have held both ways around the country. As always, it is important to keep in mind that the law governing retaliation claims under Title VII may differ from that under state and local laws.

What Does This Case Signal for Employers Managing Accommodation Requests?

A more conservative approach should guide an employers’ response to religious accommodation requests.  Employers responding to a religious accommodation request would be wise to assume — until there is settled, binding law to the contrary in the relevant jurisdiction — that a request for religious accommodation may be construed as protected activity under Title VII.  As a practical matter, this means that an adverse action that an employer takes against an employee, and that post-dates a religious accommodation request from the employee, may be challenged as retaliatory by the employee and/or the EEOC.

Best Practices for Responding to Religious Accommodation Requests

Best practices for employers to respond to religious accommodation requests, and minimize the risk of retaliation liability, include:

  • Set up a policy and process for managing religious accommodation requests in a manner that is consistent and compliant with the jurisdiction’s law.  Ensure that managers and HR are trained in the policy and process, and that employees know how to request a religious accommodation.
  • Review each religious accommodation request individually on a case-by-case basis. You can read our Roadmap for Responding to a Request for Religious Accommodation here. Given the complexities of this area of the law, it is wise to enlist the help of counsel who specializes in this area.
  • Ensure that any adverse actions taken against an employee, including those subsequent to a religious accommodation request, are based on legitimate, non-discriminatory and non-retaliatory reasons, and that the business reasons for those adverse actions are well-documented.

For more information on this topic, please contact the author, your Seyfarth Attorney, or any member of the Firm’s Absence Management and Accommodations Team.

By Sam Schwartz-Fenwick and Michael W. Stevens

Seyfarth Synopisis:  The Texas Supreme Court held that the U.S. Supreme Court’s landmark marriage equality decision, Obergefell v. Hodges, did not dispositively address how far government employers must go in providing benefits to same-sex married couples.

In a provocative opinion, in Pidgeon v. Turner, No. 15-0688, the Texas Supreme Court held that Obergefell v. Hodges, 135 S. Ct. 2584 (2015), does not necessarily require state governments to extend marital benefits to same-sex married couples.

Procedural Background

In 2013, the city of Houston began extending benefits to same-sex spouses of city employees who were lawfully married.  Shortly thereafter, Pidgeon was filed. It alleged that the city’s actions violated Texas and Houston law. The law was enjoined by a state court. In July 2015, the Texas court of appeals reversed the injunction, holding that Obergefell represented a “substantial change in the law regarding same-sex marriage since the temporary injunction was signed,” and that Obergefell forbade states from refusing to recognize lawful same-sex marriages.  The appeals court also remanded to the trial court to issue opinions “consistent with” Obergefell . Plaintiffs then appealed to the Texas Supreme Court.

The Court’s Opinion

The Texas Supreme Court reversed. The Court wrote “The [U.S.] Supreme Court held in Obergefell that the Constitution requires states to license and recognize same-sex marriages to the same extent that they license and recognize opposite-sex marriages, but it did not hold that states must provide the same publicly funded benefits to all married persons.”  Slip op. at 19 (emphasis added). The Texas Supreme Court remanded the case, so the trial court could decide if the Constitution or Obergefell “requires citizens to support same-sex marriages with their tax dollars.” Id. at 20.

The decision rested on the proposition that Obergefell is “not the end” of the inquiry as to the “reach and ramifications” of the constitutional status of same-sex marriage.  Id. at 23.  Notably, the Texas Supreme Court acknowledged that the U.S. Supreme Court had, in the same week, decided Pavan v. Smith, No. 16-992, which rejected the state of Arkansas’ efforts to limit recognition of same-sex parents on birth certificates.  In Pavan, in a per curiam opinion, the Court held that same-sex couples are entitled to the same “constellation of benefits that the Stat[e] ha[s] linked to marriage.”  2017 WL 2722472, at *2 (citations omitted).

Despite the apparent inconsistency with Pavan, the Texas Supreme Court emphasized the purported uncertainty over the reach of same-sex marital benefits by noting that the U.S. Supreme Court has also granted certiorari in Masterpiece Cakeshop, Ltd. v. Colo. Civil Rights Comm’n, No. 16-111, a case involving a baker who was sued after he refused to make a wedding cake for a same-sex wedding.

Next Steps

The trial court may now proceed to the merits of the case, and a ruling that is inconsistent with Obergefell and Pavan is a distinct possibility.  Should the case ultimately proceed to the U.S. Supreme Court, in light of Pavan, and assuming the current membership of the Court remains the same, it seems unlikely that a narrow reading of Obergefell, at least as to governmental actors, would be upheld.  Unlike Masterpiece Cakeshop, Ltd., Pidgeon does not raise any questions of freedom of speech or religious liberty.  Rather, as with Pavan and Obergefell, it addresses whether state actors can treat same-sex marriages differently than opposite sex marriage.

While the decision in Pidgeon may ultimately be vacated, that this decision was issued 2-years after a ruling by the Supreme Court legalizing same-sex marriage, underscores that opponents of marriage equality continue to use courts as a vehicle to limit or reverse marriage equality.

As Pidgeon and other challenges to marriage equality make their way through the courts, employers and benefit plans considering modifying their benefit offerings to exclude same-sex spouses should tread very carefully, especially given the EEOC’s position that differential benefit offerings to same-sex spouses violates Title VII of the Civil Rights Act.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Labor & Employment Team.

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