Employment Law Lookout

Union Files NLRB Complaint Regarding the USPS’ Handing of Security Breach Involving Employee Personal Information

Posted in NLRB

By: Bart A. Lazar

A company faced with a security breach has a lengthy “to do” list, things to accomplish with respect to its incident response plan. It must, among other things, determine the root cause of the vulnerability or breach, investigate and eliminate the vulnerability or breach, determine the full nature and extent of the breach, determine who to notify and finalize the notifications.

If the American Postal Workers Union (APWU) has its way, a unionized employer facing a security breach involving employee personal information would have yet another responsibility – bargaining over the impact of or response to the security breach.

The APWU has filed a complaint with the NLRB asserting that the United States Postal Service sent notice of the breach to employees on November 10, 2014, and offered the employees free credit monitoring for 1 year, but “did not give the Union advance notice that would enable it to negotiate over the impact and effects of the data breach on employees.” The Union’s complaint further states that by providing free credit monitoring, the USPS made a unilateral change in wages, hours and working conditions.

Under the various state database security notification laws and the HiTech provisions of HIPAA, employers that encounter a breach of personal information regarding employees, must, absent certain exceptions, notify the affected employees (or for a HIPAA breach, plan participants), as well as potentially notify regulators and others.

There is no legal requirement in the United States that companies must consult with their employees regarding the investigation and/or impact of a security breach involving employee data. In fact, it is important that information concerning potential security incidents be maintained confidential so that the investigation is not compromised. Therefore, the APWU is taking a novel, unprecedented stance in claiming that the USPS had an obligation to be at the table and bargain over what actions USPS would take with respect to investigating and/or remediating a breach.

Although it will be several months (at the earliest) before the NLRB issues any type of ruling or guidance on this matter, employers should consider this type of communication should a data breach occur.  In other words, while not legally required, it is certainly important and prudent for a company to consider all stakeholders in determining how to respond to a security breach. The goodwill of a company, and its relationships with employees and customers are  extremely valuable.

Since the wrong internal or external communications concerning a breach can have a significant impact on how actual and potential customers and employees, as well as shareholders, perceive the company we recommend that every incident response plan include a company’s public relations and communications experts in order to make sure that the proper groups are properly informed as to the status of a security incident and the measures a company is taking to protect affected individuals.

Office of Disability Employment Policy Publishes Web Portal on Accessible Workplace Technology

Posted in Workplace Policies and Processes

By Craig B. Simonsen and Kristina M. Launey

This blog, as the “ADA Title III” name indicates, is primarily about a business’s obligation to individuals with disabilities who may access its goods, services, benefits, and accommodations, rather than employees with disabilities.  However, we also frequently receive questions from entities that are subject to Title III about their obligations to provide accessible technology to  their employees, so we thought this news would be of interest to our readers.

The U.S. Department of Labor’s Office of Disability Employment Policy recently announced the launch of a Web portal, spearheaded by ODEP’s Partnership on Employment & Accessible Technology (PEAT). PEAT is an initiative to promote the employment, retention, and career advancement of people with disabilities through the development, adoption, and promotion of accessible technology. The portal is intended to provide everything “from educational articles to interactive tools.” The content “aims to help employers and the technology industry adopt accessible technology as part of everyday business practice so that all workers can benefit.”

Available on the portal Resources & Tools is the “Accessible Technology Action Steps: A Guide for Employers.” The Guide aims to provide a “roadmap to ensure that the technology in your workplace is accessible to all employees and job applicants.”

This issue is not just on the government’s radar.  At least one plaintiff’s firm in California is forcing businesses to deal with the issue of website accessibility in the employment context, recently filing a lawsuit against multiple retailer defendants alleging that the plaintiff was discriminated against in violation of the California Fair Employment and Housing Act (FEHA) (state equivalent of Title I of the ADA) and California’s Unruh Act (state equivalent of Title III of the ADA) because the businesses’ online applications were inaccessible and the companies refused to allow him any other method (i.e., paper) to apply.

These developments serve to remind businesses to review policies, procedures, training materials, and assistive technologies they use to interface with customers or employees to ensure those with disabilities are afforded equal access to the goods and services the business provides and to the benefits of employment, with or without reasonable accommodation.

Edited by Minh N. Vu.

The Midterm Election Results And How They Impact Employers

Posted in EEOC, NLRB, Workplace Policies and Processes

By: Paul Kehoe

As the dust settles on the 2014 midterm elections, Republicans have expanded their lead and the House of Representatives and taken control of the Senate with at least 52 and possibly 54 seats.  For employers, this could signal many positive developments in oversight, legislation, and appropriations over the coming year, but the election results will not end regulatory and sub-regulatory agency priorities over the next two years.


Key appointments will likely face stiff opposition for various posts in the Administration over the next two years.  In that vein, the Senate Health, Education, Labor and Pensions Committee is holding confirmation hearings for pending EEOC nominations on November 13, 2014.  The Committee will consider David Lopez for another four year term as EEOC General Counsel and Charlotte Burrows as a new EEOC Commissioner for a five year term.  All indications are that the Senate will attempt to confirm Mr. Lopez and Ms. Burrows in the lame duck session of Congress.  If successful, the EEOC will again be fully seated, empowering a majority of Commissioners to issue controversial guidance in the area of reasonable accommodation requirements, restrictions on wellness plans, and to authorize litigation, if sought by the General Counsel, on cases that attempt to expand the reach of the law under the EEOC’s jurisdiction.

At the NLRB, the President just yesterday withdrew the re-nomination of Sharon Block and, instead, nominated Lauren McFerran, currently the chief labor counsel to the Senate HELP Committee.  Ms. Block was one of the recess appointees whose appointment was invalidated by the Supreme Court in the Noel Canning decision.  If Ms. McFerran is confirmed in the lame duck session, there will be a majority of three Democrat NLRB members for the remainder of the Obama Presidency.  The NLRB is still considering the expedited election regulations and other controversial regulatory and decision issues.


In January, Senate Committee Chairmanships will be held by Republicans.  Executive overreach in many agencies, including the NLRB, OFCCP, and EEOC will likely be the subject of Senate oversight hearings.  Indeed, recent executive actions applicable to government contractors related to minimum wage (here), overtime exemptions under the Fair Labor Standards Act (here), and additional penalties for the violation of civil rights laws (here) are prime candidates for additional oversight.

In the House of Representatives, the Committee on Education and Workforce has actively conducted oversight on DOL, NLRB, and EEOC activities, joint-employer issues, minimum wage and Executive Orders which impact government contractors over the last two years.  With a larger majority in the House, continued oversight activity is expected.


Republicans stressed during the midterms the necessity to repeal the Affordable Care Act.  Recognizing the wholesale repeal is unlikely given that the President would have to agree to repeal his signature accomplishment, Republicans will likely endeavor to repeal the medical device tax, adopt the 40-hour workweek threshold for full time employment, and other measures to limit the ACA’s applicability. We would also note that the Supreme Court just granted certiorari in King v Burwell which will address whether the Federal exchanges can include premium subsidies.   Depending upon the resolution of this case, some Congressional activity can be expected.

In addition, on September 16, 2014, Senator Alexander, the incoming chairman of the Senate HELP Committee, and Mitch McConnell introduced S. 2814, the National Labor Relations Board Reform Act, which would increase the number of Board Members to 6 and require a four vote majority for NLRB decision.  In the House, several bills are pending regarding EEOC overreach and its delegation of authority to the General Counsel.  With a Republican controlled Congress, each of these and other bills will likely gain some traction, though ultimate enactment remains questionable.


Funding for the government expires on December 11, 2014, which the lame duck Congress will have to address in the coming weeks.  It remains to be seen whether a short-term extension or an extension for the balance of Fiscal Year 2015 will be considered by Congress.  Come January, the Republican-controlled Congress will likely use its power of the purse to limit government overreach.  Last year, the House passed several appropriations bills, some of which contained riders limiting how the agencies spend funds.  For example, on May 30, 2014, the House voted to approve the 2015 Commerce, Justice, Science Appropriation bill, directing the EEOC to engage in good faith conciliations before filing suit.  Similar restrictions may be on the horizon for all agencies.


The coming months will be critical in determining how a Republican Congress and Democratic Administration will approach all questions, including important labor and employment issues.  Regardless, there will be plenty of activity from agencies trying to adopt new policy positions in the final two years of the Administration.  Please continue to follow this blog for periodic updates on how employers may be impacted by these changes.


2014: The Year of Minimum Wage Increases?

Posted in Workplace Policies and Processes

By: Rob Whitman and Nadia Bandukda

Four states will have a higher minimum wage after voters cast their ballots on Election Day.  Alaska, Arkansas, Nebraska, and South Dakota are the latest states to join 13 others that enacted higher wages earlier this year.  In Arkansas, the minimum hourly wage will increase from $6.25 to $8.50 by 2017.  In Nebraska, it will rise from $7.25 to $9 by 2016.  Almost 70% of voters in Alaska voted for an increase to $9.75 by 2016, and in South Dakota, voters approved an increase from $7.25 to $8.50 by 2015.

Illinois also held an advisory vote, which serves as a nonbinding opinion poll.  Although voters expressed approval for an increased raise minimum wage, from $8.25 to $10, the vote is not binding and does not require any action by the state legislature or Governor.

The 13 other states that have increased their minimum wage this year include Connecticut, California, Delaware, Hawaii, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, Rhode Island, Vermont, and West Virginia.

Major U.S. cities will also see minimum wage increases.  San Francisco is set to raise its minimum wage to $15 by 2018, the same rate as Seattle, which approved an increase earlier this year.  Thus, by 2015, full-time workers in these cities receiving minimum wage would be paid $31,000 annually.  Oakland will also raise its minimum wage from $9 to $12.25 in March 2015, and Los Angeles Mayor Eric Garcetti has put his support behind an increase to $13.25 by 2017.

To date, a total of 23 states, and the District of Columbia, have a minimum wage above $7.25, the current federal rate. The prospects for a federal increase do not appear bright after the midterm elections, but some pundits have suggested that this may be an area where the President and Congress could reach a compromise, especially in light of the voting results at the state level.  One proposal that received strong support in the last Congress was the Fair Minimum Wage Act, which would have increased the minimum wage from $7.25 to $10.10 over three years.  According to an analysis by the Economic Policy Institute (a labor-backed research group that supports raising the minimum wage), about 21 million U.S. workers would have been directly affected by such an increase.

If you have any questions regarding this information, please contact that authors or your Seyfarth attorney.

High Tide On Paid Sick Leave Laws: The Number of States and Cities with Paid Sick Leave Laws Rises

Posted in Workplace Policies and Processes

By: Johanna T. Wise and Andrew J. Masak

While most of the political pundits, and indeed the country, are busy analyzing the election results, four new localities passed paid sick leave laws.  As we previously blogged, the current landscape of paid sick leave laws is a patchwork of varying regulations, causing headaches for many employers.  And compliance isn’t getting any easier as the number of states and cities with paid sick leave laws rises.

Paid sick leave laws were on ballots and passed in: Massachusetts; Trenton, NJ; Montclair, NJ; and Oakland, CA (while California already has a paid sick leave law, Oakland now expands on it).  Specifically:

Massachusetts:  Allows employees to accrue a minimum of one hour of paid sick time for every 30 hours worked.  Caps paid sick time at 40 hours annually.

Oakland, CA:  Gives employee’s one hour of paid sick leave for every 30 hours worked.  Current California law gives workers a minimum of 24 hours of paid sick leave.

Montclair, NJ:  Gives employees one hour of paid sick leave for every 30 hours worked.

Trenton, NJ:  Gives employees one hour of paid sick leave for every 30 hours worked.

The tide is certainly rising on the number of paid sick leave laws throughout the country.  At the end of 2013, only one state and six cities had such laws.  As it stands today, three states and sixteen cities have sick leave laws on the books.  New Jersey now has eight cities with paid sick leave laws, making it the clear municipal leader in the area (Jersey City, Newark, East Orange, Irvington, Passaic, Paterson, Montclair, and Trenton).  And, while the list of regulations employers face continues to surge and business considerations mount, employers are wise to review their current policies and consider how they will record and monitor employees’ hours for purposes of determining accruals and eligibility.

For a more detailed analysis of these laws, please see the Management Alert written by our colleagues, Joshua Seidman and Anne Bider.

For additional information on paid sick leave laws, contact the authors, any member of Seyfarth’s Absence Management and Accommodation Team, or your Seyfarth attorney.

FLSA vs. NCAA: New Minimum Wage Action Levels Latest Attack on Amateur Status of College Athletes

Posted in Workplace Policies and Processes

By: Jason J. Englund and Giselle Donado

A collective action filed last month in the Southern District of Indiana seeks unpaid wages on behalf of NCAA college athletes, claiming that student athletes are “employees” under the Fair Labor Standard Act and entitled to at least the minimum wage.  A former women’s soccer player at the University of Houston filed the suit, naming the NCAA and all Division I schools as defendants.

The former forward’s suit is only the latest shot aimed at NCAA rules preventing college athletes from receiving pay for their play on the field.  The National Labor Relations Board is currently reviewing the much-discussed decision by an NLRB Regional Director last Spring deeming Northwestern football players “employees” under the National Labor Relations Act and holding that the athletes must be permitted to organize. (Please see the blog posts here and here from our colleagues who blog about Employer Labor Relations.)  The NCAA is also playing defense on the antitrust front, where it is currently appealing a ruling in a California court last August, which blocked the NCAA from enforcing its rules preventing college athletes from being paid for use of their names and likenesses.

In the newly filed FLSA suit, the plaintiff seeks to represent a sprawling class consisting of “all NCAA Division I student athletes participating in women’s and men’s sports” for the past three years, arguing that each of these schools is subject to the same NCAA bylaws that prohibit payment to college athletes.  The plaintiff argues that student athletes should be compensated as temporary employees for their work on the field just as students who participate in other work study programs.  The plaintiff asserts that student athletes put in long hours—between 30 and 40 hours per week, depending on the sport—and confer substantial benefits on the NCAA and member schools without receiving any wages for their efforts.   The plaintiff points out those universities pay the students who usher and sell concessions at the games, but not the athletes who make the games possible.

This latest volley at the NCAA is of interest not only to sports fans, but employers everywhere.  The suit reflects the continuing trend of challenges to work study and unpaid internship programs, which we have previously covered on the Firm’s Wage & Hour Litigation Blog (see, for example, here and here).  Employers should carefully review any internship programs, training programs, or other programs that receive valuable service from individuals who are not paid.

The NCAA suit is also noteworthy in that the plaintiff sued not only her dear old alma mater, but also the NCAA and all member schools, advancing a theory that the defendants jointly conspired to deprive athletes of pay.  The suit is likely to raise questions of joint employer liability and should be watched closely by employers who use third parties to administer unpaid internship programs.

Just as this suit challenges a relationship between universities and athletes that has persisted for decades, even the most longstanding unpaid internship programs and related practices may be challenged.  Regardless of what happens in the NCAA’s series of matches against student athletes, plaintiffs lawyers will continue seeking to score off employers who even arguably receive services for free.

For additional information on this topic, please contact the authors or our Seyfarth attorney.

Special in Person Handshakes are Now the Only Way to Verify Receipt of a Communication?

Posted in Workplace Policies and Processes

By: Kevin A. Fritz

Under the Family Medical Leave Act (“FMLA”), the process for providing an employee with leave arguably generates enough paper to defoliate a small forest. Among the mound of paper, is the important notice letter, which designates an employee’s absence as leave under the FMLA.

Now, our lawyer fan base can appreciate the timeless law school principle of the mailbox rule. Tested on many a first year law school final exam, the mailbox rule stands for the notion that if a letter, properly directed, is proved to have been given to the post-office or delivered to the postman, it is presumed that it reached its destination at the regular time, and is received by the person to whom it was addressed.

Traditionally, the legal protection of the mailbox rule guaranteed that if a former employee denied ever receiving a letter that designated her absence as leave under FMLA, her previous employer would avoid liability. Two recent cases have shaken that notion and called into question a timeless notice principle.

US Mail

In Lupyan v. Corinthian Colleges Inc., 761 F.3d 314 (3d Cir. 2014), an employee’s sworn statement that she did not receive her employer’s mailed FMLA notification letter was sufficient to create a fact question precluding summary judgment.

Lisa Lupyan requested a “personal leave” in early December 2007 relating to her depression. Her supervisor suggested she apply for short-term disability instead, and Lupyan submitted a Certification of Health Care Provider. Her employer determined that Lupyan qualified for FMLA, and later that month mailed Lupyan a letter explaining her rights under the statute and advising that she was expected to return to work by April 1, 2008. Lupyan denied ever having received the letter. Five weeks after Lupyan was scheduled to return to work, the college terminated her employment.  Lupyan claimed interference with her FMLA rights, arguing under that she would have “expedited her return” had she known her leave was subject to the requirements of the FMLA.

The Third Circuit reversed the district court’s grant of summary judgment in favor of the college. In support of its summary judgment, the employer had submitted affidavits from other employees verifying that the notification letter was sent via standard mail. The Third Circuit recognized that this evidence entitled the employer to the benefit of the mailbox rule, BUT that “this ‘is not a conclusive presumption of law.’”  Because Lupyan claimed in an affidavit that she never received the notice, the Third Circuit concluded that she “sufficiently burst the mailbox rule’s presumption, to require a jury to determine the credibility of her testimony, as well as that of [defendant]’s witnesses.”  Lupyan was essentially able to force her former employer to proceed to trial simply because she claimed to have never received her employer’s notification that her leave was designated as FMLA leave. Talk about a shake to the Notice Tree!


Then, just weeks ago, in Gardner v. Detroit Entm’t, LLC, 2014 WL 5286734 (E.D. Mich. Oct. 15, 2014), a court determined that notice sent by email is not necessarily reliable either.

Summer Gardner worked for Motor City Casino and took FMLA leave due to a degenerative spinal disorder, which made it difficult for her to work on her feet several days in a row. As with most degenerative disorders, Gardner’s intermittent leave duration and frequency was hard to anticipate.  Indeed, in September 2011 alone, she took intermittent FMLA leave nine times, which was five more than anticipated by her physician, and she also had called off work every Sunday that month.  The casino sought recertification of Gardner’s condition due to the increased frequency and her Sunday absence pattern.  It sent its FMLA notices to Gardner by email, instead of US mail as it had done in the past.  Gardner claimed that she did not receive the emailed FMLA notices.  When she failed to return the recertification, her absences were considered unexcused, and she later was terminated.

The court noted that the FMLA regulations only require that the employer provide the employee oral notice of the need to provide recertification. The court found this method to be the most desirable, since it guarantees person-to-person communication. As to FMLA notice sent by email, the court noted that:

“Defendant had the right to require Plaintiff to recertify her FMLA leave . . . Specifically, the issue is whether Defendant, by informing Plaintiff of the recertification requirement via email, gave Plaintiff proper notice of that requirement . . . The transmitting of an email, in the absence of any proof that the email had been opened and actually received, can only amount to proof of constructive notice.” 

Only constructive notice?!  The court refused to dismiss Gardner’s FMLA claims, finding that the dispute over whether she actually received the FMLA notices by email precluded a dismissal of her FMLA claims. The court ultimately determined that only a jury could decide whether the casino violated the law.


Both Lupyan and Gardner stand as a blunt reminder to employers that they must be careful to comply strictly with the FMLA’s notice requirements, and to preserve verifiable documentation of all communications with their employees on leave. Along with using a delivery method that creates evidence of receipt, employers should also want to follow up via email or telephone with an employee who is out on leave to ensure that they get the message.

Many companies have turned away from paper in an effort to Go Green and streamline FMLA process.  Helping the environment and adopting technology are great business models, but at least these two courts placed an increased value in providing the FMLA notices and required certification to employees in person and having the employee sign a confirmation of receipt.  Written confirmation (certified mail or express delivery requiring a signature) whenever possible may be most effective to combat an argument that notice was not received.  

These decisions will surely have broader implications in FMLA litigation, which probably guarantees the loss of even more trees.  Whether other courts follow these decisions remains to be seen.  Certainly employers with operations in the Third Circuit or the State of Michigan should review their FMLA notice procedures to ensure compliance.

For more information regarding FMLA leave laws and notice requirements, please contact the author, a member of Seyfarth Leave and Accommodation Management team, or your Seyfarth attorney.  Stay tuned here for the latest updates.

Railroad Ordered to Pay $225,000 in Whistleblower Action where Employee Allegedly Lied About Prior Injuries

Posted in OSHA Compliance, Whistleblower

By: Ada W. Dolph and Craig B. Simonsen

A railroad’s decision to terminate an apprentice electrician whose OSHA injury report revealed he had not been truthful in his employment record about other prior workplace injuries was unlawful retaliation under the whistleblower provision of the Federal Railroad Safety Act, 49 U.S.C. § 20109 (FRSA), OSHA has ordered.  The railroad was ordered to pay $50,000 in compensatory damages, $150,000 in punitive damages, more than $22,000 in back wages and interest, and reasonable attorney’s fees.

After the employee was seriously injured at work, the injury was reported to OSHA and included information regarding prior unrelated workplace injuries.  The company investigated the injury, reviewed the information reported to OSHA, and concluded that the employee had been dishonest with the company about his prior workplace injury record.  As a result, the company terminated the employee’s employment.  The employee filed a whistleblower complaint under FRSA asserting that his employment had been terminated in retaliation for reporting workplace injuries.  OSHA agreed, leveling this significant damages award against the company.

This decision demonstrates how broadly OSHA will interpret employee whistleblower protections.  Employers should tread lightly when taking disciplinary action that is the fruit of any aspect of employee activity that is permitted under the whistleblower provisions of FRSA or any of the 21 other statutes that OSHA is charged with enforcing.

Ada Dolph is a Partner and Craig Simonsen is a Senior Litigation Paralegal, in Seyfarth Shaw LLP’s Chicago office.  If you would like further information on this topic, please contact a member of the Workplace Whistleblower Team, your Seyfarth attorney, Ada Dolph at adolph@seyfarth.com, or Craig Simonsen at csimonsen@seyfarth.com.

U.S. Supreme Court Passes on Review of Illinois Employee Classification Act, Leaving Statute Intact as “Constructed”

Posted in Alternative Work Forces & Independent Contractors

By: Giselle Donado, Kevin A. Fritz, and Jason J. Englund

An Illinois state law directed at preventing the misclassification of construction employees as independent contractors remains intact after the US Supreme Court declined to consider a roofing company’s challenge to the 2008 law.

Illinois Employee Classification Act

The Illinois Employee Classification Act imposes substantial penalties for the misclassification of employees as independent contractors with respect to construction projects performed within the State of Illinois.  Through these penalties, the Act creates a presumption that any person performing services for a covered construction company is an employee of that company—unless the company can affirmatively prove that the individual is an independent contractor.

Jack’s Roofing

In 2010, the Illinois Department of Labor (“DOL”) issued a preliminary determination that Jack’s Roofing had misclassified its workers as independent contractors in violation of the new statute, and the DOL slapped the company with a “potential penalty” of nearly $1.7 million.  Plaintiffs responded by filing an action against DOL seeking injunctive relief and a declaratory judgment that the statute was unconstitutional. Plaintiffs argued that the Act was unconstitutionally vague and violated the Equal Protection Clause of the Illinois and US Constitutions because no other industry faced the same standards when seeking to hire independent contractors.  Plaintiffs also sought a declaration that the Act violated the Special Legislation Clause of the Illinois Constitution, which the plaintiffs argued prohibits imposing more stringent employment standards for the construction industry than other industries.

Plaintiff’s arguments came unshingled at trial in state court, appellate court, and the Illinois Supreme Court recently completed the leveling.  With the latest Illinois court ruling, the state’s highest court determined that plaintiff’s due process arguments were moot and that plaintiffs failed to brief sufficiently the other constitutional arguments.  Now with US Supreme Court declining to hear the case, plaintiff’s case is grounded for good.  More importantly, this inaction by the nation’s highest court ensures that the Employee Classification Act will likely remain the law for some time, leaving in place the powerful tools granted to the Illinois Department of Labor.


Violations of the Employee Classification Act invoke fines in increasing amounts per violation, starting at $500 per violation.  The Act also prohibits retaliation and creates a private right of action under which an employee may recover wages, benefits, attorneys’ fees, and costs.  As such, it is important that employers in the construction and related industries pay special attention to the provisions of this law.  While a $500 per fine may appear to be manageable at first blush, each day a misclassified worker performs services is deemed a separate violation.  Exposure for penalties can add up quickly across the company’s workforce, even with a low fine per worker.  To remain on sure footing, Illinois construction employers must be diligent about filing complete and accurate reports to avoid being subjected to harsh penalties.

Employers need to be very careful when classifying workers as independent contractors.  Since the Employee Classification Act presumptively assumes construction workers and the like are employees (not independent contractors), proper classification is vital.