Hiring, Testing & Selection

By Michael Fleischer, Jean Wilson, and Barry Miller

Synopsis: Massachusetts Attorney General investigates 70 employers (both large and small – across all industries), citing 21 of them for violating the state’s “ban the box” law, which prohibits most businesses from asking about job candidates’ criminal backgrounds on initial employment applications.

Last week, Massachusetts Attorney General Maura Healy announced that her office conducted an investigation into the employment applications of more than 70 Boston-area businesses to determine if they violated the Commonwealth’s “ban the box” law. That law prohibits most employers from asking job applicants about their criminal history on initial applications, subject to limited exceptions. The employers investigated ranged from a restaurant chain to a skin care company to a book store.

The Attorney General entered into agreements with four large employers that have multiple locations in Massachusetts. In conjunction with those agreements, three of the companies were fined $5,000 each, and all were required to alter their application process to comply with the law’s requirements. The Attorney General also sent warning letters to an additional 17 employers, noting that they must take immediate steps to comply with Massachusetts law, and remove questions on their initial job applications that ask questions about applicants’ criminal histories. The improper questions included whether applicants have been convicted of violating the law, whether they had been convicted of a crime or offense other than a minor traffic violation, and if they have ever been convicted of a felony.

The Attorney General’s announcement of this enforcement activity comes on the heels of the Commonwealth’s recent passage of a criminal justice reform bill that becomes effective on October 13, 2018, and further restricts the questions that an employer may ask about an applicant’s criminal history following an initial employment application.

The Attorney General stated that the investigation was part of a larger, ongoing effort by her office to help educate businesses about the law, and to ensure that an individual’s criminal history is not used improperly to deny access to employment. This serves as a reminder to employers to review their hiring-related documents to ensure compliance with evolving legal requirements. Even if applicants do not complain about violations or assert legal claims, the Attorney General is engaged in proactive efforts to make sure that employers in the Commonwealth comply.

If you would like further information, please contact the authors, your Seyfarth attorney, or any member of the Seyfarth Background Screening Compliance & Litigation Team.

 

By: Jennifer Mora, Jean Wilson and Barry Miller

Synopsis: Effective October 13, 2018, Massachusetts employers will no longer be permitted to inquire about certain misdemeanor convictions and sealed or expunged records for employment purposes.

Almost ten years ago, Massachusetts became the second state, following Hawaii, to enact a “ban-the-box” law, so-called because they require employers to remove from job applications any question that asks a job applicant to self-disclose their criminal history. Instead, employers must wait until later in the hiring process to do so, unless the employer is prohibited by law from employing criminal offenders in the position at issue. Since that time, the ban-the-box wave has spread across the nation, with laws most recently enacted in Washington (discussed here) and California (discussed here).

In addition to the ban-the-box law, Massachusetts’ anti-discrimination law also contained provisions that restricted “what” employers may inquire about, including:

  • Any arrest, detention or disposition that did not result in a conviction;
  • A first offense for the following misdemeanors: disturbance of the peace; drunkenness; simple assault; affray; minor traffic violations; and speeding; and
  • Any misdemeanor conviction where the date of the conviction, or the completion of any period of incarceration resulting from the conviction, occurred more than five years prior to the date of the employment application, unless the person was convicted of any crime during that same five-year period.

On April 13, 2018, Governor Charlie Baker signed a criminal justice reform bill, which changed existing law in several respects. Importantly, the amendment reduced the five-year period for inquiring about misdemeanors to three years, which means that employers now may not ask about (whether orally or in writing) any misdemeanor conviction where the date of the conviction, or the completion of any period of incarceration resulting from the conviction, occurred more than three years prior to the date of the employment application, unless the person was convicted of another crime within the three years preceding the inquiry. Moreover, in addition to being prohibited from asking about sealed records, employers may not ask about a criminal record that has been expunged.

In addition, any form used by an employer that seeks information about an applicant’s criminal history must include the following statement about expunged records, in addition to the statement already required concerning sealed records:

“An applicant for employment with a record expunged pursuant to section 100F, section 100G, section 100H or section 100K of chapter 276 of the General Laws may answer ‘no record’ with respect to an inquiry herein relative to prior arrests, criminal court appearances or convictions. An applicant for employment with a record expunged pursuant to section 100F, section 100G, section 100H or section 100K of chapter 276 of the General Laws may answer ‘no record’ to an inquiry herein relative to prior arrests, criminal court appearances, juvenile court appearances, adjudications or convictions.”

In addition, the criminal justice reform bill lowers the number of years before an individual can seek to have a criminal record sealed or expunged. Ultimately, this means that employers will have less access to criminal history information in making employment decisions. In response to employers’ concerns about being held liable for negligent hiring or retention based on criminal history to which they no longer had access, the legislature included a provision in the bill that incorporates presumptions based on employers’ more limited access to such information. Employers will be presumed not to have notice (or the ability to know) about (i) records that have been sealed or expunged, (ii) records about which employers may not inquire under the anti-discrimination law, or (iii) crimes that the Massachusetts Department of Criminal Justice Information Services cannot lawfully disclose to an employer.

Massachusetts employers, and nationwide employers that hire in the state, should immediately review their job applications to ensure they are not inquiring about criminal history information too early in the process. They also should consider reviewing and modifying any pre-hire policies and forms to ensure they are not inquiring about off-limits information and that any written question to applicants that inquires about criminal history contain the required language. Employers in all jurisdictions should stay abreast of ongoing developments in this evolving area of the law.

By Jennifer L. Mora and Pamela Q. Devata

Seyfarth Synopsis: Michigan Governor Rick Snyder recently signed a bill that will prohibit counties and cities from enacting “ban-the-box” ordinances or other restrictions on the ability of private employers to inquire about criminal history early in the hiring process.”

On March 26, 2018, Michigan Governor Rick Snyder signed Senate Bill 0353, which amends existing state law that limits the powers of local governmental bodies regarding the regulation of terms and conditions of employment for private sector employers (the “Local Government Labor Regulatory Limitation Act”), by providing that:

A local governmental body shall not adopt, enforce, or administer an ordinance, local policy, or local resolution regulating information an employer or potential employer must request, require, or exclude on an application for employment or during the interview process from an employee or a potential employee.

In other words, Michigan cities and counties are prohibited from passing ban-the-box-ordinances for private sector employers or other laws that regulate hiring decisions made in the private sector. As a practical matter, this means that local government bodies in Michigan cannot require employers to wait until later in the hiring process, such as after an interview or a conditional offer, to ask job applicants, “Have you ever been convicted of a crime?”.

The law goes on to state that it does not prohibit an ordinance, local policy, or local resolution “requiring a criminal background check for an employee or potential employee in connection with the receipt of a license or permit from a local governmental body.”

The amendment is effective 90 days after it is enacted into law.

In the last few years, nationwide employers have struggled to keep up with the onslaught of state and local ban-the-box laws. Fortunately, for the time being, Michigan employers, and nationwide employers with a presence in Michigan, do not have to worry about this jurisdiction being added to the growing list of such laws, including, most recently, California and Washington. That said, existing Michigan law restricts employer use of criminal history in some respect by making it unlawful for an employer to request information regarding a misdemeanor arrest, detention or conviction that did not result in a conviction.

Employers that hire in Michigan should consider reviewing their background screening policies to ensure that misdemeanor non-convictions are not being requested or considered. All employers should continue to be mindful of other laws regulating criminal records checks and screening policies, including the Fair Credit Reporting Act (a consistent source of class action litigation) and state and local employment and ban-the-box laws.

If you would like further information, please contact the authors, your Seyfarth attorney, or any member of the Seyfarth Background Screening Compliance & Litigation Team.

By Michael Wahlander

Seyfarth Synopsis: Within the last few years, the California Legislature has amended laws related to an employee’s right to inspect personnel records, intending to ensure employees have access to those records. Since then, employers have seen more such requests, claims made before the Labor Commissioner, and even lawsuits over production of personnel files. We offer here some tips on how to comply.

What Is This Letter and What Do I Do About It?

Your company receives a letter from a former employee (or a lawyer) asking to inspect the personnel file or “employment records.” What (if anything) should you do in response?

How and when a California employer responds to these requests can have legal consequences. That’s right—employers can be sued (or even face criminal liability) over how they did, or did not, respond to personnel file requests.

The proper response depends, first, on what the employee is asking to inspect. In California, three principal statutes govern employee requests to inspect personnel records—Labor Code §§ 1198.5, 226, and 432. See below for details.

Labor Code § 1198.5

Section 1198.5 says that employees (and former employees) have the right to inspect personnel records maintained by the employer “related to the employee’s performance or to any grievance concerning the employee.” Employers must allow inspection or copying within thirty (30) days of the request, which can be made by the employee or their representative (often an attorney). That time period can be extended by five (5) days by mutual agreement.

Covered documents: Under the terms of the statute, it appears that documents such as performance reviews, commendation letters, disciplinary notices (“write-ups”), corrective action plans, and complaints about the employee would likely be covered.

The language in Section in 1198.5 is broad; it uses the terms “related to” and “concerning.” As a result, determining exactly what other documents might be covered can be a challenge. But the Labor Commissioner has issued some guidance on its website on what might be included in a “personnel file,” including, in addition to the above, things like an employment application, notices of leaves of absence or vacation, education and training notices, and attendance records. Unfortunately, there is no appellate case interpreting the scope of the current statutory language. So the overall scope of the statute still remains an open-ended question.

Nevertheless, the statute excludes certain files. For most employers, those files are (1) records about a criminal offense, (2) letters of reference, and (3) ratings, reports or records obtained before the employee’s employment, prepared by identifiable examination committee members, or obtained in connection with a promotional examination. In addition, employers can redact the names of any non-supervisory employee mentioned in the requesting employee’s file.

There are also situations when the statute does not apply. For example, if an employee (or former employee) files a lawsuit that “relates to a personnel matter” against the employer, then the right to inspect or copy the records ceases during the pendency of the lawsuit. The inclusion of this provision strongly suggests that Section 1198.5 is not a replacement for broad civil discovery.

What happens if I forget to produce records in time? If the employer does not permit the inspection or copying of these records in time, the employee may bring an action to obtain a court order (injunction) for the employer to comply with the statute. Employees are also entitled to a statutory penalty of $750 AND an award of attorneys’ fees and costs for bringing the action. And failure to comply is a criminal infraction. Ouch!

Labor Code § 226

Section 226 requires California employers to furnish employees with itemized wage statements that show nine (9) specific categories of information, such as all hourly rates, hours worked, gross wages earned, etc. The employer must provide these wage statements at the time employees are paid or semi-monthly. The specific information required and the entire text of the statute can be found here.

Covered documents: The scope of this one is easier than Section 1198.5. In addition to requiring itemized wage statements, this section also requires the employer to produce those wage statements to employees on request or a computer-generated report that shows all nine (9) categories of information required. Employers must make the records available to the employee within twenty-one (21) days.

What happens if I forget to produce records in time? Section 226 has remedies similar to those available under Section 1198.5. Section 226 also authorizes the employee to sue for a court order requiring the employer to produce the information and also a penalty of $750, and employees can also recover attorneys’ fees for bringing the lawsuit. Violation of the statute is also a criminal infraction. But unlike Section 1198.5, there is no exception for pending litigation. Yikes!

Labor Code § 432

Section 432 applies to any document that an employee (or job applicant) “signs” that is related to obtaining or holding employment. Upon request, the employer must provide those documents. Fortunately, this statute is simpler than the others. There is no timeline for production and there is no private right of action to enforce compliance.

But that does not mean that employers should ignore requests under this statute. As a practical matter, documents covered by this section can also be covered by Section 1198.5 (i.e., signed performance reviews or signed disciplinary write-ups). More importantly, failure to comply with such a request is a misdemeanor. And there is also no exception for pending litigation. Wow!

Covered documents: As mentioned, Section 432 covers any document the employee signed related to “obtaining” or “holding” employment. Examples include job applications, handbook acknowledgments, arbitration agreements, job descriptions, and any signed policy acknowledgments (anti-harassment, retaliation, discrimination, at-will employment, meal/rest break polices, etc.).

Workplace Solutions

Employers often wonder if they have to produce “every” record about an employee in response to these requests. As the statutes indicate, the answer is “no”— only documents that fall within the categories requested need to be produced. Employers must also remember to protect other important rights. Indeed, personnel issues often implicate attorney-client privilege, attorney work-product, proprietary information, and privacy issues. As a result, responding to personnel file requests often requires a case-by-case approach.

If you would like assistance in ensuring your company’s compliance with a personnel file request, or if you have any questions raised in this post, then please do not hesitate to contact the author or any other member of Seyfarth’s Labor and Employment Group.

Edited by Coby M. Turner.

 

 

By Pamela Q. Devata, Robert T. Szyba, Alnisa Bell, and Ephraim J. Pierre

Seyfarth Synopsis: As cities across the nation adopt “ban the box” legislation that regulates private employers’ ability to inquire into applicants’ and employees’ criminal histories, employers face a nuanced gauntlet of compliance issues. This post briefly reviews recent developments in New York City, Philadelphia, Austin, and San Francisco.

 

The Movement For “Ban the Box” Legislation

Since 2000, we have seen a growing movement to adopt so-called “ban the box” legislation, which is shorthand for laws requiring that employers remove from their employment applications checkboxes or questions that ask if an applicant has a criminal record. In 2012, the Equal Employment Opportunity Commission endorsed removing checkboxes or questions regarding criminal convictions from job applications through its Criminal History Guidance.  The President of the United States also endorsed the “ban the box” movement and directed federal agencies to delay inquiries into criminal records.

Presently, eight states—Hawaii, Illinois, Massachusetts, Minnesota, New Jersey, Oregon, Rhode Island, and most recently Vermont—have adopted “ban the box” laws that apply to private employers and have imposed a variety of nuanced requirements targeted at removing the conviction history question on job applications as well as placing other limitations on such inquiries. An additional group of sixteen states have “ban the box” laws aimed at the public sector.

Spreading Through Cities and Municipalities

In addition to state-level legislation, certain cities have enacted ban the box ordinances. To date, the District of Columbia and 26 cities and counties have adopted some form of “ban the box” legislation.  For example, New York City (see our earlier post here), Philadelphia (here), San Francisco (here), and most recently, Austin, Texas (here), have adopted “ban the box” ordinances, each with a host of nuanced requirements.  Below are common compliance questions that employers will encounter under each law.

Who is a Covered Employer?

While each ordinance covers private employers, each ordinance establishes a different employee threshold for coverage. For example, Austin’s ordinance applies to private employees with at least 15 employees whose primary work location is within the city for each working day in each of 20 or more calendar weeks in the current or preceding calendar year.  Philadelphia’s ordinance, in contrast, applies to all private employers with at least one employee in the city.  The New York City ordinance applies to all private employers with at least four employees, while the San Francisco ordinance applies to private employers with 20 or more employees, regardless of location.

What Can be Asked on Job Applications?

Generally, each ordinance contains restrictions that apply to job postings and employment applications. New York City, for example, prohibits “any limitation or specification regarding criminal history” in a job advertisement, application, or at any other stage in the hiring process prior to a conditional offer of employment.  Similarly, employers in Philadelphia are prohibited from making “any inquiry” regarding an applicant’s criminal convictions, and Austin employers cannot “solicit” criminal history information, until after a conditional offer is made.

San Francisco, by contrast, requires that all job advertisements explicitly state that qualified applicants with arrest and conviction records will be considered for the position in accordance with the Fair Chance Ordinance, but prohibits employers from asking about arrest or conviction records on a job application.

Philadelphia and San Francisco also require employers to post conspicuous notices regarding a job applicant’s rights.

When Can You Inquire About A Job Applicant’s Criminal History?

Although employers are not prohibited from inquiring into criminal history, each ordinance is designed to defer the timing of the inquiry into one of the latter stages of the employment process. For example, San Francisco employers must wait to inquire about criminal history until after either they have conducted a live interview with the applicant, or made a conditional offer of employment.  On the other hand, the Austin, New York City, Philadelphia ordinances (and others) permit an employer to ask about an applicant’s criminal history only after extending the conditional offer.

What Is The Minimum Individualized Assessment For Job Applicants?

Generally, employers are prohibited from taking adverse action against job applicants because of criminal history without first conducting an “individualized assessment.” Each ordinance establishes the minimum number of factors that employers are to consider as part of the individualized assessment.  However, each ordinance varies in its approach.

The minimum “individualized assessment” under each ordinance consists of:

Austin Employers must consider: (1) the nature and gravity of any offenses in the individual’s criminal history; (2) the length of time since the offense and completion of the sentence; and (3) the nature and duties of the job for which the individual has applied.
New York City

Employers must consider the factors found under New York Corrections Law, Article 23-A. Namely: (1) that New York public policy encourages the licensure and employment of people with criminal records; (2) the specific duties and responsibilities of the prospective job; (3) the bearing, if any, of the person’s conviction history on her or his fitness or ability to perform one or more of the job’s duties or responsibilities; (4) the time that has elapsed since the occurrence of the events that led to the applicant’s criminal conviction, not the time since arrest or conviction; (5) the age of the applicant when the events that led to her or his conviction occurred, not the time since arrest or conviction; (6) the seriousness of the applicant’s conviction history; (7) any information produced by the applicant, or produced on the applicant’s behalf, regarding her or his rehabilitation or good conduct; (8) the legitimate interest of the employer in protecting property and the safety and (9) welfare of specific individuals or the general public.

Employers must also consider a certificate of relief from disabilities or a certificate of good conduct, both of which shall create a presumption of rehabilitation. Employers must also memorize their analysis on a required Fair Chance Act Notice.

Philadelphia Employers must consider: (1) the nature of the offense; (2) the time that has passed since the offense; (3) the applicant’s employment history before and after the offense and any period of incarceration; (4) the particular duties of the job being sought; (5) any character or employment references provided by the applicant; and (6) any evidence of the applicant’s rehabilitation since the conviction.
San Francisco Employers must consider: (1) only directly-related convictions, (2) the time that has elapsed since the conviction or unresolved arrest, and (3) any evidence of inaccuracy or evidence of rehabilitation or other mitigating factors.


What Notice is Required Prior To An Adverse Action?

Each ordinance regulates the how an employer must inform a job applicant of adverse action based on their criminal background check, above and beyond any notice required under the Fair Credit Reporting Act or other applicable laws. Under each ordinance, an employer is required to provide applicants with at least written notice and a copy of the obtained background check. The New York City ordinance is particularly nuanced, however, and requires that employers also provide a copy of Article 23-A of the New York Corrections Law; a copy of the consumer report; and a copy of the employer’s analysis on a Fair Chance Act Notice.

In addition to written notices, employers are also required to provide job applicants a specific amount of time to provide additional evidence or explanation. In particular, New York City requires three days from receipt of the notice; Philadelphia requires ten days; and San Francisco requires seven days.

How will this Ordinance Be Enforced?

Enforcement under each ordinance is largely left to specific equal employment or human rights administrative agencies within each city. Each administrative agency is authorized to collect civil penalties for violations.  The availability of a private right of action varies among the ordinances, however. For example, the Austin ordinance does not provide for a private right of action. San Francisco also does not provide for a private right of action, but the San Francisco Office of Labor Standards Enforcement may refer the matter to the city attorney for civil action.  In contrast, the Philadelphia ordinance establishes an administrative exhaustion requirement before permitting a private right of action.  New York City provides for a private right of action under the New York City Human Rights Law.  Retaliation is generally prohibited under each ordinance as well.

Employer Outlook

Because of the current wave of ban the box ordinances is likely to continue, employers should continue to evaluate their pre-employment and hiring practices and make necessary adjustments. Specifically, affected employers should review their employment applications, advertisements, and postings to ensure that any questions regarding an applicant’s criminal history are legally compliant for each cities and municipalities.  Affected employers should also make sure all hiring/recruiting managers are apprised of the new ordinance requirements through training and revision of policies.  Employers should also be aware of the limitations on requesting and using criminal history information throughout the hiring process.  Finally, employers operating in multiple jurisdictions should pay particular attention to the nuanced requirements of the various applicable ordinances, which at times may impose inconsistent or conflicting requirements.

If you would like further information, please contact the authors, your Seyfarth Shaw LLP attorney, or a member of the Seyfarth Background Screening Compliance & Litigation Team, http://www.seyfarth.com/background-screening-compliance-litigation.

By Maria Papasevastos and Nadia Bandukda

On Monday, the New Jersey Assembly approved a pay equity bill that would amend the New Jersey Law Against Discrimination to strengthen protections against pay discrimination in the workplace.

The bill already passed the Senate last month, and is now being sent to Governor Christie’s desk.  While Christie has vetoed or conditionally vetoed similar pay equity bills in the past, he has yet to comment on the current legislation.

If signed into law, the bill would impact New Jersey employers in several significant ways:

First, the bill makes it an unlawful employment practice for an employer to discriminate on the basis of sex by paying a different rate of compensation for “substantially similar work,” when viewed as a composite of skill, effort and responsibility.  Thus, similar to the recently-enacted California Fair Pay Act, the New Jersey law would allow employees to be compared even if they do not hold the “same” job, as long as their work is “substantially similar.”

Second, the bill states that comparisons of employee wage rates will be based on wage rates in all of an employer’s operations or facilities, and does not set any geographic or other limitations. This is also similar to the California law, which allows employees to be compared even if they do not work in the same establishment.

Third, the bill provides that any pay differential would only be permitted if the employer demonstrates that the differential is made pursuant to a seniority or merit system, or, alternatively, if the employer proves each of the following requirements:

  1. The differential is based on a bona fide factor other than sex, such as training, education or experience, or the quantity or quality of production;
  2. The factor or factors do not perpetuate a sex-based differential in compensation;
  3. Each of the factors is applied reasonably;
  4. One or more of the factors account for the entire wage differential; and
  5. The factors are job-related with respect to the position in question and based on legitimate business necessity. However, the factor will be disallowed if there are alternative business practices that would serve the same business purpose without producing the wage differential.

Fourth, the bill, which is modeled after the Lilly Ledbetter Fair Pay Act (“Lilly Ledbetter”), makes each paycheck another instance of discrimination.  In addition, while Lilly Ledbetter sets a two-year cap on back pay, the New Jersey bill goes further to provide that, where the violation has been continuous, an aggrieved employee may obtain back pay for the entire period of time in which the violation occurred, as long as the violation continued to occur within the two-year statute of limitations.  An employer also cannot require an employee to agree to a shortened statute of limitations or waive any of the protections provided by the law.

Finally, the bill prohibits retaliation against employees who disclose information regarding their (or any other current or former employee’s) job title, occupational category or rate of compensation, including benefits, if the purpose of the request for information is to assist in investigating potential discriminatory treatment in pay.

Given the trend of pay equity hitting the nation, including such laws going into effect in New York and California (see our prior alert on New York’s pay equity law here, our alert on the California Fair Pay Act here, our alert on the Massachusetts Attorney General investigations on compliance with the Massachusetts Equal Pay Act here, and our alert on the EEOC’s proposed pay report here), it is crucial that employers consider pay equity auditing to keep abreast of their internal pay trends and ensure compliance with these laws.

 

By Dawn Solowey

In the wake of Paris and San Bernandino, the EEOC has issued new “Questions and Answers” for employers concerning workers who are, or are perceived to be, Muslim or Middle Eastern.  The agency issued companion questions and answers for employees.

It’s a timely topic as employers seek to protect all employees’ rights at a time when terrorism, workplace violence, and anti-Muslim rhetoric are the subject of headlines, viral social media posts, and water-cooler conversation.

The EEOC starts with the basics: an employer cannot discriminate based on religion, ethnicity, national origin, or race; must reasonably accommodate religious beliefs unless to do so would impose an undue hardship; and cannot retaliate for discrimination or harassment complaints.

The agency then provides hypothetical scenarios and guidance on hiring and employment decisions; harassment; religious accommodation and background investigations.

Hiring and Other Employment Decisions

The EEOC opines, consistent with prior Guidance on religious garb, that an employer cannot deny an employee a position due to customer preferences. For example, a store cannot refuse to hire a Muslim wearing a hijab as a cashier because customers may be uncomfortable.  Nor can the store assign the employee to a non-customer-facing position.

The EEOC also opines that a temporary agency cannot comply with a client’s request for the agency to either have the employee remove the hijab, or to substitute an alternative temporary employee. The EEOC’s position is that the temporary agency must explain to the client the duty to accommodate the hijab, and if the client still refuses the worker, must reassign the worker to a different assignment at the same pay, and decline to send the client an alternative worker.

Harassment

The EEOC posits various hypotheticals about harassment against employees who are, or may seem to be, Muslim or Middle Eastern, such as a Muslim employee called “ISIS,” or drawn into unwanted discussions of Islam and terrorism, by a coworker.

The EEOC points out that clear, effective policies against harassment, and a confidential reporting mechanism for harassment, are crucial elements of an anti-harassment strategy. When harassment is reported, the employer must take prompt remedial action.  The nature of that remedial action if fact-driven; in one situation, the employer might solve the problem by facilitating a discussion between employees, in others, corrective action such as counseling, a warning, or more severe discipline, may be warranted.

Accommodation

The EEOC notes that accommodations for Muslim employees (like those of other religions) may include time off for religious holidays, or exceptions to dress and grooming codes. The EEOC also offers a hypothetical in which Muslim employees ask to use a conference room for prayer.  While offering little analysis, the agency states that the company may be able to deny the use if the room is needed for business, but that in “many circumstances” allowing the use may not impose an undue hardship.  The EEOC also opines that if normal work breaks are not sufficient, the employer may need to consider the feasibility of longer breaks.  The agency notes that the company should not deny an accommodation based solely on “speculation” that other Muslim employees will seek the same, but should consider the instant request on its merits, making later adjustments as necessary.

Background Investigations

Background checks are a current hot topic for the EEOC. Here, the EEOC states that the employer can impose the same pre-hire background checks imposed on other applicants, but “may not perform background investigations or other screening procedures in a discriminatory manner.”  The agency notes that “security clearance determinations for positions subject to national security requirements under a federal statute or an Executive Order are not subject to review under the equal employment opportunity statutes.”

Key Takeaways

  • The very fact that the EEOC issued this publication speaks to a renewed focus on anti-Muslim discrimination and foreshadows an uptick in litigation in this area.
  • The current climate is an opportunity for employers to take a fresh look at its anti-discrimination and harassment policies, complaint mechanisms, and accommodation practices, to ensure compliance and efficacy.
  • Effective training not only helps prevent litigation, but can assist a defense. Companies should train managers on nondiscriminatory hiring practices, and how to manage employee complaints and accommodation requests.
  • When an employee complains of alleged discrimination or harassment, the employer should investigate promptly, and if a violation is found, take prompt remedial action.
  • The EEOC’s brief guidance does not wrangle with all of the complexities that its hypotheticals raise. Further, states and localities may impose different or additional requirements.  An employer facing such scenarios would be wise to consult employment counsel to help protect employees’ rights while minimizing legal risk.

By Pamela Q. Devata, Robert T. Szyba, and Ephraim J. Pierre

SCOTUSFollowing the U.S. Supreme Court’s grant of certiorari on April 27, 2015 in Spokeo, Inc. v. Robins, No. 13-1339 (which we reported here), the Petitioner has weighed in with their brief.

As you may recall, the question before the Court has the potential to determine the future scope of congressional power, as well as consumer and workplace-related class actions: Does a plaintiff who suffers no concrete harm, but who instead alleges only a statutory violation, have standing to bring a claim on behalf of himself or a class of individuals?

Recall that the Plaintiff, Thomas Robins, brought a purported class action against Spokeo, Inc., accusing the company of violating the Fair Credit Reporting Act (“FCRA”) by presenting inaccurate information about him on the Internet. The Plaintiff sued because the company over-reported his earnings and education level, and reported that he was married with children, even though he was not married and had no children, alleging this information might have a negative impact on his employment prospects. However, the Plaintiff did not allege any actual injury or harm, and thus no actual damages, instead seeking statutory damages.

The U.S. Court of Appeals for the Ninth Circuit reversed the district court’s dismissal, and held that the “violation of a statutory right is usually a sufficient injury in fact to confer standing” and that “a plaintiff can suffer a violation of the statutory right without suffering actual damages.” 742 F.3d 409, 413. After briefing by the parties and various amici curiae, the Supreme Court sought the Solicitor General’s input, who opined that review by the Court was not warranted. The Court disagreed, and granted certiorari anyway.

Petitioner’s Argument

On July 2, 2015, the company filed its Brief for Petitioner, arguing the merits of the appeal now before the Court. The company first argued that Congress may not override requirement of an actual injury under Article III of the Constitution and established Supreme Court precedent. For instance, the brief pointed out that Warth v. Seldin, 422 U.S. 490 (1975), which the Ninth Circuit relied on below, dealt with Congress’s ability to legislate in light of principles of prudential standing, not Article III standing. Prudential standing, which is comprised of judicially-created principles, places limitations such as prohibiting a party’s ability to sue on behalf of a third party, prohibiting generalized grievances (e.g., there is no “taxpayer standing”), and limiting standing to those who are within the zone of protectable interests. The Petitioner explained that even if Congress can override these principles, it cannot override the Constitution.

This understanding comports with the past several hundred years of legal history, as the Petitioner looked back to medieval England and the evolution of the common law’s causes of action, all of which required an actual harm or injury to redress. With that backdrop, the Petitioner explained, the Framers designed Article III to permit the federal judiciary to hear “Cases” and “Controversies,” thereby limiting the courts’ authority to hear cases lacking a concrete harm, consistent with centuries of the English legal tradition upon which the limitation was based, and dovetailed with the powers of the other branches of the U.S. government. Even with these historical roots, the Petitioner pointed out that the standing requirement is a critical limitation on the modern class action device, which is commonly employed to bring cases seeking “hundreds of millions or billions of dollars” (indeed, Robins is brought on behalf of “millions” of putative class members, for up to $1,000 each — or, “billions” of dollars).

The Petitioner went on to argue that the technical violation of a statute is not the same as an actual harm to a plaintiff, and therefore cannot meet the Article III requirement. Otherwise, the body of law on Constitutional standing would be replaced by the simple inquiry into whether a statute was violated, with a corresponding fine that the private plaintiff could recover. Indeed, even compared to copyright law, where a statutory violation is actionable, the underlying injury is based in a plaintiff’s property right, well-established in the common law. Similarly, the law of defamation recognizes actual harm as a pre-requisite to suit, even if it is difficult to assess the extent of actual damages.

Last, the Petitioner argued that even if a mere statutory violation satisfies the injury-in-fact requirement, the Supreme Court should hold that the FCRA does not recognize a cause of action for plaintiffs who are unable to demonstrate concrete harm because Congress did not specifically express its intent to do so.

Supreme Court’s Decision May Have Wide-Ranging Effects

The Supreme Court’s decision in Spokeo is likely to dramatically affect employers, consumer reporting agencies, and other corporate defendants as well as class actions brought under various federal statutes, such as the FCRA, and potentially the Fair Debt Collection Practices Act, the Telephone Consumer Protection Act, and the Employee Retirement Income Security Act, as well as data breach claims. Notably, the Supreme Court first appeared ready to decide this issue several years ago in First American Financial Corp. v. Edwards, No. 10-708 (2010). Nevertheless, after briefing and oral argument, the Supreme Court dismissed action as “improvidently granted.” It appears that the Supreme Court may be ready to tackle the question in Spokeo, as indicated by its rejection of the Solicitor General’s recommendation to deny certiorari or simply avoid the broader question of Congressional power.

Now that the issue is before the Court, a broad Article III ruling could have a significant impact if it addresses whether Article III limits Congressional power to create statutory rights enforceable through a private right of action, without the plaintiff having to first personally suffer a concrete harm. If this Congressional power were limited, the number of viable class actions under the FCRA and other federal statutes (often those seeking millions or billions in damages) may be similarly and substantially limited.

Of course, the Supreme Court may also affirm the Ninth Circuit under a broad Article III ruling, and establish that Congress may create a private right of action based on a mere statutory violation and not a concrete, actual injury. A decision allowing individual and class claims to go forward alleging only statutory damages would embolden potential plaintiffs and encourage more complex class actions. Indeed, private plaintiffs and their counsel would have the ability to find, and potentially recover for, a number of legal violations they might find regardless of whether any actual harm occurred.

Presently, the Respondent is scheduled to file his brief on August 24. As Spokeo unfolds, employers should continue to closely monitor the developments in the case in light of the potential impact on prospective and current workplace and consumer litigation across a variety of federal statutes.

If you have any questions regarding this article, please contact any of the authors, or your Seyfarth attorney.

By Marc R. Jacobs

In a closely watched case, the Colorado Supreme Court ruled that an employer could lawfully terminate an employee who tested positive for marijuana in a random drug test, even though the employee’s use of marijuana was off-duty and prescribed under Colorado’s Medical Marijuana Amendment. Coats v. Dish Network, LLC, 2015 CO 44 (2015).

Brandon Coats is a quadriplegic. In 2009, he obtained a Colorado state-issued license to use medical marijuana to treat painful muscle spasms.  He consumed the prescribed medical marijuana in accordance with his license and the state law.  He was employed by Dish Network from 2007 to 2010 as a telephone customer service representative.  In May 2010, Coats tested positive for a component of medical marijuana during a random drug test.  He informed Dish that he was a registered medical marijuana patient and would continue to use it.  Dish terminated his employment under its drug policy.

Coats sued Dish, claiming that he was wrongfully terminated under Colorado’s “lawful activities statute” (Colo. Rev. Stat. Section 24-34-402.5) which generally prohibits the discharge of an employee based on the person’s “lawful” off-duty activities.  Coats essentially argued that because his use of medical marijuana was “lawful” and protected under Colorado law, the termination violated the lawful activities statute.  The trial court and appellate court rejected his claim.

In a unanimous decision (one justice did not participate), the Colorado Supreme Court affirmed the dismissal of Coats’ lawsuit.  Although Coats’ use of medical marijuana was lawful under Colorado’s medical marijuana law, marijuana is a “controlled substance” under the federal Controlled Substances Act and its use, even for medicinal purposes, is a federal criminal offense.  As a result, the Court held that Coats’ use of medical marijuana was not “lawful” and he was not protected from termination because of his use of medical marijuana.  The Court also rejected arguments that use of medical marijuana was no longer unlawful because: (a) the U.S. Department of Justice announced that it will not prosecute certain patients who use medical marijuana in accordance with state law; and (b) in December 2014, Congress passed an appropriations bill that prohibits the Department of Justice from using funds appropriated under the act to prevent states with medical marijuana laws (like Colorado) from implementing those laws.

Although this decision is only binding in Colorado, it provides guidance that other courts likely will consider and follow when applying similar “lawful activities” statutes. For this Court, so long as marijuana is listed as a controlled substance under the federal Controlled Substances Act, its possession and use is unlawful and is not lawful activity under the state law.

We will continue to monitor and report on developments in this area of the law.

 

By Katherine Mendez

Hot off the heels of the Supreme Court’s decision in Young v. United Parcel Service, Inc., recently, a bipartisan group of lawmakers declared their intent to reintroduce the Pregnant Workers Fairness Act.

You may recall that on March 25, 2015, the Supreme Court handed down its decision in Young v. United Parcel Service, Inc.  The Court vacated the Fourth Circuit’s decision and held that a pregnant worker seeking to show disparate treatment through indirect evidence may do so through the McDonnell Douglas burden shifting framework.

Under Young, a plaintiff may establish a prima facie case of discrimination by showing that she belongs to the protected class, she sought an accommodation, she was not accommodated, and that the employer accommodated other employees who were similar in their ability or inability to work.  If the plaintiff can establish her prima facie case, the burden shifts to the employer to articulate a legitimate non-discriminatory reason for denying the plaintiff the accommodation.  The reasons cannot consist simply of a claim that it is more expensive or less convenient to add pregnant women to the category of those whom the employer accommodates.

If the employer articulates a legitimate, nondiscriminatory reason, then the burden shifts back to the plaintiff to show that the employer’s reason is pretext for unlawful discrimination.  The plaintiff can show pretext by providing evidence that the employer’s policies impose a “significant burden” on pregnant workers and the employer’s legitimate, nondiscriminatory reasons are “not sufficiently strong” to justify the burden.  The plaintiff may do so by providing evidence that the employer accommodates a large percentage of non-pregnant workers while failing to accommodate a large percentage of pregnant workers.  (For a full analysis of the Young decision see Seyfarth Shaw’s One Minute Memo “SCOTUS Issues Decision in Pregnancy Accommodation Discrimination Case Against UPS.”)

Confused?  So was the legislature, which now seeks to cut the cord with the Supreme Court’s decision by delivering a new bill, which lawmakers claim will clarify ambiguities in the Supreme Court’s ruling in Young.  The bill articulates the following five unlawful employment practices: (1) failing to make reasonable accommodations to known limitations to the pregnancy, childbirth, or related medical conditions of job applicants or employees, unless the accommodation would impose an undue hardship on the employer’s business operation; (2) denying employment opportunities based on the need of the employer to make such reasonable accommodations; (3) requiring such job applicants or employees to accept an accommodation that they choose not to accept; (4) requiring protected employees to take leave if another reasonable accommodation can be provided for their known limitations; or (5) taking adverse action against an employee because she requests or uses a reasonable accommodation related to her pregnancy, childbirth, or related medical conditions.

In light of the recent developments in the law and the “bun” in the legislature’s oven, employers should strongly consider adopting practices that consider accommodation of pregnant employees, even if the pregnancy is without complications.

If you have questions regarding this topic, please contact the author, a member of Seyfarth’s Absence Manager & Accommodation Team [http://www.seyfarth.com/Absence-Management-and-Accommodations , or your Seyfarth lawyer.