By Matthew J. Gagnon

Seyfarth Synopsis: As we look ahead to the end of the year, and Seyfarth Shaw’s annual analysis of trends and developments in EEOC litigation (see here for last year’s publication), we can begin to see how the EEOC has shaped equal pay litigation in the federal courts in 2019. For years, the Fourth Circuit has been a hotbed for equal pay cases, and FY 2019 continued that trend. Employers should be mindful of this Circuit’s litigation as a trend for things to come across the country.

Since 2012, the EEOC has included equal pay protections as one of its six substantive area priorities in its Strategic Enforcement Plan (SEP). The SEP guides the EEOC’s enforcement activity in terms of the types of lawsuits it brings and the theories of law that it champions and pursues.

The EEOC reports – and our yearly analysis has consistently confirmed – that the six priorities identified in the SEP are lightning rods for increased EEOC litigation, and are more often the subject of the agency’s conscious, directed development of the law. For that reason, we believe that employers are well advised to understand how the EEOC interprets and applies its enforcement priorities, as they tend to be a reliable guide to the types of employers, industries, and business practices that the EEOC is actively targeting. This post will describe the legal developments in FY 2019 within the EEOC’s equal pay priority.

EEOC Litigation Developments In 2019

Equal Pay Act cases are often highly fact-driven and therefore notoriously difficult for employers to scuttle with pretrial motions. Several recent decisions arising out of EEOC-initiated litigation are illustrative of this trend.

For example, in EEOC v. Enoch Pratt Free Library, No. 17-CV-2860, 2019 WL 5593279 (D. Md. Oct. 30, 2019), the District Court for the District of Maryland denied the EEOC’s and the employer’s cross-motions for summary judgment. With respect to the motion filed by the EEOC, the District Court found that genuine issues of material fact persist regarding elements of the EEOC’s prima facie case. Id. at *5. In particular, the District Court held that the evidence showed that employees within the charging party’s position, library supervisors, perform a wide variety of job duties across various library branches: “Overall, the branches generally have varying responsibilities in light of their different physical plants, different clientele, and different community resources. . . . A factfinder should therefore assess whether the duties performed by [supervisors] are sufficiently similar to establish a prima facie case of unequal pay for equal work.” Id.

With respect to the employer’s motion, the District Court applied the reasoning of a recent decision out of the Fourth Circuit, EEOC v. Maryland Insurance Administration, 879 F.3d 114, 124 (4th Cir. 2018). The EEOC alleged that the employer paid three former female fraud investigators less than it paid four former male fraud investigators with comparable credentials and experience. The Fourth Circuit held that the EPA requires “that an employer submit evidence from which a reasonable factfinder could conclude not simply that the employer’s proffered reasons could explain the wage disparity, but that the proffered reasons do in fact explain the wage disparity.” Id. at 129. The employer argued that it could not have discriminated against the charging parties because it used the state’s Standard Salary Schedule, which classifies each position to a grade level and assigns each new hire to a step within that grade level. The Fourth Circuit rejected this defense because it found that the employer exercised discretion each time it assigns a new hire to a specific step and salary range based on its review of the hire’s qualifications and experience.

In Enoch Pratt Free Library, the employer had also argued that any wage differential was due to a factor other than sex, rather than due to discrimination, based on its use of a facially neutral salary scale, the Managerial and Professional Society Salary Policy (MAPS), to determine compensation for newly hired library supervisors. 2019 WL 5593279, at *6. The District Court held, however, that that policy did not necessarily compel any specific salary to be awarded to a new hire because it left open the possibility that the employer could apply discretion with respect to setting starting salaries. Id. Applying Maryland Insurance Administration, the District Court concluded that “[the EEOC’s comparator] was hired at a rate not only higher than the female [library supervisors] represented by the EEOC, but also significantly above the salary he had received during his first tenure at [employer]. Given these facts, combined with the inherent discretion within the MAPS policy, genuine factual questions exist about how defendants arrived at [the comparator’s] salary.” Id. at *7.

An employer’s burden at the motion to dismiss stage is even higher. For example, in EEOC v. George Washington University, No. 17-CV-1978 (CKK), 2019 WL 2028398 (D.D.C. May 8, 2019). the District Court for the District of Columbia denied an employer’s motion to dismiss even though the complaint at issue did not explicitly allege how the positions at issue were equal with respect to skill, effort, and responsibility. In that case, the EEOC had brought a lawsuit on behalf of a female university Director of Athletics, who alleged that a male colleague was treated more favorably and given greater opportunities because of his sex. Id. at *1. The University allegedly advertised a new position in its athletics department, but plaintiff had been informed that the job was off-limits to her because the University had already decided to hire her male coworker. Id. at *2. The position paid far more than plaintiff’s position.

The University moved to dismiss the complaint. The District Court held that the complaint “straightforwardly pleads that [plaintiff] was paid less as Executive Assistant than [comparator] was paid as a Special Assistant for substantially the same job responsibilities.” Id. at *4. The Court held that there was no reason for the complaint to get into the equal skill, effort, and responsibility, or other similar working conditions of those two positions, because at the motion to dismiss stage, a court cannot dismiss a complaint even if the plaintiff did not plead the elements of a prima facie case.

Implications For Employers

As these cases demonstrate, employers face considerable hurdles when trying to dispense with an equal pay claim early in the litigation. The fact-dependent nature of those claims often block an easy win at the motion to dismiss or summary judgment stage. When coupled with the increased stakes that come with litigating against the EEOC, these developments are yet another reminder that employers should be proactive about identifying and addressing pay equity risks. Even a facially neutral compensation policy may not be enough to save employers from expensive, protracted litigation if and when the EEOC comes knocking.

Our annual comprehensive analysis of trends in EEOC litigation will be published at the end of the calendar year. As always, we will continue to monitor EEOC litigation, including as it relates to equal pay issues, and keep our readers apprised of developments. We look forward to sharing lessons learned from FY 2019 at the beginning of 2020!

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


The Employment Law Lookout blog is taking a holiday break this week, but will resume delivering insightful discourse and updates on the day’s most pressing workplace issues next week.

As a reminder for employers we have previously posted these blogs on holiday safety topics and behaviors: Have Yourself a Safe, Undistracted, and Accident Free Holiday, Don’t Let Too Much Eggnog Ruin Your Office Holiday Party: Tips to Limit Employer Liability at Company Parties , and Ring in the New Year, But Don’t Invite the Constable.

In the meantime, we want to wish all of our readers, contributors, and editors a safe and happy (and warm) Thanksgiving holiday.  We hope you are able to spend time with family, friends, and loved ones and rest assured knowing that we’ll be on the lookout for more management insights to bring you as we move into the year end and into 2020.

Thank you and Happy Holiday.

By Condon McGlothlen, Adam R. Young, and Craig B. Simonsen

Seyfarth Synopsis: The Illinois General Assembly passed SB 1557, revising the language of the Recreational Cannabis Law to reduce but not completely eliminate employer liabilities.

As we previously blogged, the Illinois Cannabis Regulation and Tax Act (410 ILCS 705) (the “Legalization Act”) will legalize recreational cannabis for Illinois adults starting January 1, 2020. The Legalization Act specifically allows Illinois employers to enforce “reasonable zero tolerance or drug free workplace policies, or employment policies concerning drug testing, smoking, consumption, storage, or use of cannabis in the workplace or while on call provided that the policy is applied in a nondiscriminatory manner.” The Act permits employers to prohibit employees from being under the influence of or using cannabis in the employer’s workplace or while on call. Further, the Act (i) allows employers to discipline or terminate an employee who violates the employer’s workplace drug policy, and (ii) specifically insulates employers from liability for disciplining or terminating employees based    on the employer’s good faith belief that the employee was either impaired at work (as a result of using cannabis) or under the influence of cannabis while at work.

However, the Act raised questions about new potential liabilities for Illinois employers. First, the Legalization Act amended the Illinois Right to Privacy in the Workplace Act, which prohibits discrimination against employees for their use of “lawful products” outside of work (defined as lawful products under state law), including cannabis and marijuana. This created a potential cause of action for applicants who test positive on a for marijuana at the post-offer, pre-employment stage. Because the applicant has not started working, such a test could only detect marijuana use outside the workplace. Return-to-duty drug testing presented similar liabilities, typically detecting off duty drug use during a leave.

Employers who test current employees, e.g., post-accident or based on reasonable suspicion, faced new exposure if a discharged employee claimed the employer lacked a “good faith belief” that the employee had been impaired by or under the influence of cannabis. For example, if the employer discharged some employees who tested positive but not others, a discharged employee could claim the employer lacked a “good faith belief” regarding impairment. Alternatively, because there is no legally or medically accepted definition of what constitutes his or her “impairment” (or being “under the influence” of marijuana), the employee could assert he was not in fact impaired at work, and that a positive test result alone cannot prove otherwise.

With the January 1, 2020 deadline approaching, Illinois business community representatives raised numerous concerns with lawmakers. The Illinois Chamber of Commerce proposed revising the Act to clarify permissible drug testing and to limit possible causes of action against employers. Both Houses have passed SB 1557, a bill which amends and clarifies many portions of the cannabis-related laws. The Act as amended would say:

Nothing in this Act shall be construed to create or imply a cause of action for any person against an employer for:

(1) actions taken pursuant to an employer’s reasonable workplace drug policy, including but not limited to subjecting an employee or applicant to reasonable drug and alcohol testing, reasonable and nondiscriminatory random drug testing, and discipline, termination of employment, or withdrawal of a job offer due to a failure of a drug test.

SB 1577 Sec. 705-10(50)(e)(1). This new provision is separate and apart from the Act’s safe harbor for employer decisions based on the employer’s good faith belief that an employee was impaired or under the influence of marijuana while performing his or her job duties.

For post-accident, random, or other forms of current employee testing, the Legalization Act now more effectively limits employer liability by expressly limiting causes of action based on discipline or termination on account of a failed drug test. However, the language regarding an employer’s “good faith belief” remains in the statute. Employees may therefore still pursue litigation alleging such a belief is required for lawful termination, and that the employer lacked this requisite belief in discharging the plaintiff.

With regard to pre-employment, post-offer testing, revisions to the Legalization Act seemingly eliminate employer liability for revoking offers due to failed drug tests. The Legalization Act as amended would explicitly permit “withdrawal of a job offer due to a failure of a drug test.” Section 705-10(50)(e)(1). While the original law amended the Illinois Right to Privacy in the Workplace Act to allow for discrimination claims founded on the use of “lawful products” (e.g. cannabis) outside work, the Right to Privacy in the Workplace Act specifically invokes 705-10(50)(e)(1) of the Legalization Act. Consequently, employer liability for withdrawing offers to applicants who test marijuana-positive – under either the Legalization Act or the Right to Privacy in the Workplace Act – has been effectively eliminated.

Governor Pritzker has not yet signed the bill into law. The Governor has sixty days in which to sign or veto or veto the bill; otherwise it becomes law effective January 13, 2020 – twelve days after the Legalization Act’s January 1, 2020 effective date. We do not know whether Governor Pritzker will take action on the amendments before the New Year. Regardless, we do not anticipate courts enforcing the Legalization Act as regards employment during early January with the amendments potentially taking effect two weeks later. We will continue to monitor developments in this area closely, and will keep employers informed.

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 Cannabis Law Practice Teams.

By Tonya M. Esposito and Renee B. Appel

Seyfarth Synopsis: Businesses should take note of recent developments in the CBD space. Consumer protection regulatory agencies issued another joint warning to a company selling CBD products making allegedly unsubstantiated claims. And, the FDA continues to stick to its public position that it is working toward both understanding the impact of CBD on users and crafting an effective regulatory framework. Despite this activity, Congressional leaders are still nipping at the heels of the FDA. Senator Chuck Schumer called on the FDA to issue and implement its CBD regulatory framework as soon as possible, and to report back to his office on its progress to date. In the interim, businesses will be left wondering what the rules of the road are.

Joint Warning Letter

Issued on October 10, 2019, the FDA and FTC partnered together to issue a joint warning to Rooted Apothecary LLC (“RA”), of Naples, Florida, for illegally selling unapproved CBD products that claim to solve a variety of health issues. RA has been accused of, among other things, claiming on its website that its products treat pain in infants, autism, attention-deficit/hyperactivity disorder (ADHD), as well as Parkinson’s and Alzheimer’s disease.

In their joint letter, both regulatory agencies made clear that RA’s purportedly fraudulent acts are illegal under statute. The FTC warned that such acts are illegal under the Federal Trade Commission Act, which makes it illegal to advertise products that can deceive consumers. Moreover, the FTC cautioned that any claims of treatment of diseases in humans must be backed by “competent and reliable scientific evidence.” Meanwhile, the FDA noted that under the Food, Drug, & Cosmetic Act, RA has 15 days to respond to both the FDA and FTC on how it will correct these violations.

In its joint letter, the FDA made clear that it was “working quickly to further clarify our regulatory approach for products containing cannabis and … CBD.” To that end, it has called on the public to report adverse reactions to CBD products to the agency’s MedWatch program. The FDA stated that in evaluating potential regulatory solutions, it holds public health as its prime goal, one that is achieved through “science-based decision-making.” Dr. Amy Abernethy, Principal FDA Deputy Commissioner, previously stated that the FDA would report on its inquiry into the science behind CBD in late summer/early fall of 2019. No report has been issued yet.

Schumer’s Call to Action

Senator Chuck Schumer’s call to action for the FDA stems from the passage of the 2018 Farm Bill. In his public statements last month, Senator Schumer explained that the CBD space, which is already sizeable in New York, is poised to grow into a billion-dollar industry. In light of this, Senator Schumer notes that businesses within his state are eager to join the CBD craze, but cannot act without rules of the road. He indicated that it is “imperative” that regulations be issued and implemented as soon as possible, and that the FDA’s efforts thus far have been “woefully” inadequate. Senator Schumer requested that within 90 days of his letter to Acting FDA Commissioner, Norman Sharpless, the FDA is to provide Senator Schumer’s office an outline of “agency’s current plans for a specific regulatory framework related to CBD along with a timeline for when comprehensive enforcement policies for CBD products will be finalized and implemented.”

Repeated calls to action from various parties (ranging from former FDA Commissioner Scott Gottlieb, to members of the public at large, and now Congressional leadership) have urged the FDA to provide guidance in the CBD space. As Senator Schumer recognized, CBD has the potential to become a billion dollar industry in New York state alone. The importance of this appears not lost on the FDA, but it reiterates the need for adequate scientific data in order to move forward. In the interim, the public and business continue to wait for regulatory clarity and are left trying to navigate muddy waters.

Seyfarth’s Cannabis practice has a deep bench of experienced attorneys who actively counsel clients in this space. Seyfarth will continue to monitor developments and report them as they become available.

By Paul S.Drizner

Seyfarth Synopisis: Illinois recently enacted legislation that changes the rules for withholding income tax from non-resident employees. The new rules replace the current, somewhat more complicated rules with a more straight-forward method that is based on, among other things, the number of working days that an employee spends in Illinois.

Current Withholding Rules

Currently, every employer maintaining an office or transacting business in Illinois that is required to withhold federal tax from compensation paid to a non-resident employee in Illinois is also required to withhold Illinois income tax from such payment. Compensation is considered paid to an employee in Illinois if:

  • the employee’s services for the employer are performed entirely within Illinois;
  • the employee performs some services for the employer outside of Illinois but those services are incidental to the services that the employee performs for the employer within Illinois; or
  • the employee performs some services for the employer within Illinois and the employee’s base of operations or, if the employee has no base of operations, the place from which the employee’s service is directed or controlled is within Illinois.

New Withholding Rules

Effective for tax years ending on or after December 31, 2020, employers are required to withhold Illinois income tax from compensation paid to a non-resident employee if:

  • the employee performs some services within Illinois;
  • the employee’s services that are performed within Illinois are not incidental to services that the employee performs outside of Illinois; and
  • the employee performs services within Illinois for more than 30 working days during the tax year.

The amount of compensation that is considered paid in Illinois under the new rules is the portion of the employee’s total compensation for services performed for the employer during the year which the number of the employee’s working days spent in Illinois during the year bears to the total number of the employee’s working days spent everywhere during the year.

What is a Working Day?

A working day is any day during the year in which the employee performs services on behalf of the employer. Days in which the employee performs no services on behalf of the employer (e.g., weekends, vacation days, sick days and holidays) are not considered working days. Further, a working day is considered spent within Illinois if (i) the employee spends more time that day performing services for the employer within Illinois (without regard to any time spent traveling) than the employee spends performing services for the employer outside of Illinois, or (ii) the only services that the employee performs for the employer on that day is traveling to Illinois and the employee arrives on that day.

A working day does not include any day during a disaster period in which an employee performs services in Illinois solely in response to a request made to the employer by a business or by an Illinois state or local government to perform disaster or emergency-related services in Illinois. Disaster or emergency-related services generally mean repairing, building or performing other business activities related to infrastructure that has been damaged or destroyed by a state or federally declared disaster or emergency event. A disaster period is the period that begins 10 days before the earlier of the date of the Illinois governor’s proclamation or the President’s declaration of a state of emergency or a federal major disaster and ends 60 days after the end of the declared disaster or emergency period.

Tracking Where an Employee Performs Services

If an employer maintains a time and attendance system that tracks where employees perform services on a daily basis, then the information provided by that system is used to determine whether non-resident employees are subject to Illinois tax withholding. A time and attendance system is a system (i) in which an employee is required to contemporaneously record the employee’s work location for every day that the employee works outside of the state where the employee primarily works, and (ii) that is designed to allow the employer to allocate an employee’s wages for tax purposes among all the states in which the employee works.

If an employer does not maintain a time and attendance system, the employer is required to obtain a written statement from its non-resident employees indicating the number of days that the employee reasonably expects to perform services in Illinois during the year. Unless an employer has actual knowledge of an employee’s fraud or gross negligence in preparing the statement, or there is collusion between the employer and the employee to evade tax, the employee’s certification is prima facie evidence of the number of days that the employee spent working in Illinois.

Unfortunately, the law does not explain how an employer should address the situation where it fails to withhold Illinois tax from wages paid to a non-resident employee for the employee’s first 30 Illinois working days if the employee ends up working in Illinois for more than 30 working days and the failure was either because the employee’s statement incorrectly estimated that the employee would work less than 30 days in Illinois or because the employer maintained a time and attendance system but did not begin withholding Illinois tax until after the employee had more than 30 working days in Illinois. Perhaps future guidance will answer this question.


The new rules should make it easier for Illinois employers to determine when they are required to withhold Illinois income tax from wages paid to non-resident employees. Illinois employers with non-resident employees should either implement a time and attendance system by January 1, 2020 or prepare a form statement that non-resident employees can provide to the employer before January 1, 2020 (and before each subsequent January 1) estimating the number of days they reasonably expect to work in Illinois during the year.

For more information on this or any related topic please contact the author, your Seyfarth attorney, or any member of the Seyfarth Shaw’s Labor & Employment Group or the Workplace Policies and Handbooks Team.

By Anthony Califano, Jennifer Mora, and Frederick T. Smith

Seyfarth SynopsisEmployers are grappling with the wave of marijuana laws sweeping the nation, some of which provide very employee-friendly protections. While no state requires an employer to tolerate employees’ use of marijuana or impairment while they are working, present drug testing methodologies cannot determine whether an employee used marijuana two hours or two weeks ago. That might be changing as companies reportedly are closer to developing technology that will be able to detect recent use, a welcome development for both employers and employees.

Here Are The Problems:

Marijuana causes impairment to people who ingest it. Actually, the psychoactive component of marijuana, THC (tetrahydrocannabinol), is what really causes impairment. It weakens judgment and motor function. If an employee goes to work high, that creates serious safety concerns. It also creates legitimate concerns regarding employee judgement, behavior, work product, and efficiency. Science has confirmed that these concerns stemming from marijuana use are legitimate.

Another problem is that marijuana use is illegal under long-standing federal law, the Controlled Substances Act. To be clear, it is still illegal to use, possess, or distribute marijuana. Many employers take issue with the idea of being required to tolerate their employees’ conduct that is plainly criminal. Understandably, employers may not like the message that condoning marijuana use sends to their clients, target markets, and communities.

Opinions as to whether marijuana should be legal vary. But most would agree that no employer should have to tolerate employees working while high from use of marijuana—whether the use is legal or illegal. This idea is similar to the generally accepted idea that employers need not tolerate employees working while intoxicated from alcohol consumption, which is legal. Indeed, a number of state marijuana laws include provisions reflecting that employers need not accommodate or tolerate marijuana use or impairment in the workplace or while working.

This is the point at which perhaps the most practical problem lies for employers and employees. How can an employer know if an employee is impaired or high from ingestion of THC?

An employer with “reasonable suspicion” that an employee is working while intoxicated from alcohol can rely on science to establish impairment. Blood alcohol tests have generally been accepted to measure impairment from alcohol consumption. Unfortunately, there has been no  scientifically-accepted drug test to show impairment from marijuana use. While most tests show the presence of THC in a person’s system, reflecting use in recent days or weeks before the test, they do not show impairment at or near the time of the test.

New And Improved Testing Methods Could Be A Solution:

Science may be catching up with the times. A number of media outlets have reported that certain companies are developing tests that use breathalyzers to evaluate how recently a person used marijuana. According to reports, these tests are being designed to show if a person used marijuana within the 2-3 hours before the test, which has been reported to be within the peak period of impairment after ingestion of THC.  It is unclear if and when these devices will be available for employment-related testing or the costs associated with such tests.

That said, if new marijuana testing devices and methodologies become generally available, and they are validated as a reliable means by which to determine impairment or recent marijuana use, employers may have a much needed solution to their legal and practical dilemmas. In fact, these marijuana tests could bring employees and applicants peace of mind too. An employee who uses marijuana at home on Sunday evening, in accordance with his doctor’s instructions, may be able to rest easy knowing that, if sent by his employer for a drug test on Monday, the test results will show that he was not impaired while working.

The near term development and reliability of these testing devices is currently unknown and employers should not expect them to be a panacea to their marijuana woes. Amongst other issues, the devices may not be permitted by state law. Where their use is permissible, we predict their validity and reliability will be challenged by experts and their widespread use by certified laboratories for workplace drug testing programs is not likely to occur any time soon.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Cannabis Law Practice or Workplace Policies and Handbooks Team.

By Thomas F. Howley and Dov Kesselman

Seyfarth Synopsis: The DOL’s ARB rejected an employee’s SOX retaliation claim where he inadvertently provided information to his employer and only “hinted” that he was filing a SOX-protected complaint. The ARB seems unwilling to accept retaliation claims where the employee fails to report to, or actively conceals information from, the statutory entities under SOX.

On October 31, 2019, the United States Department of Labor’s Administrative Review Board (ARB) affirmed the dismissal of a whistleblower retaliation claim under the Sarbanes-Oxley Act (SOX), holding that the employee did not engage in protected activity by inadvertently providing information to his employer or by “hinting” at filing a complaint. Hoptman v. Health Net of California, ARB No. 2017-0052, ALJ No. 2017-SOX-00013 (ARB Oct. 31, 2019) (per curiam). This decision highlights SOX’s goal of encouraging open disclosure.


Complainant was a claims representative for Respondent, a health maintenance organization. He allegedly discovered systematic overpayments by Respondent’s plan members and began texting with a plan member (the “Member”) to expose Respondent’s actions. Complainant asked the Member to fill out a HIPAA release so he could gather information. He also told her he did not have enough money to continue his investigation and suggested that he would share any reward money if she helped. At Complainant’s suggestion, the Member filed a complaint with California’s Department of Managed Health Care (DMHC) about her overpayments and provided the text messages that Complainant sent her.

Complainant later met with one of the Respondent’s HR managers on a separate matter and mentioned that he had read an online article about Respondent owing significant back taxes to the IRS. He hinted that Respondent was “going to be in a lot of trouble” and that he had a “complaint in the works.” Complainant, however, did not mention fraudulent activity or filing a complaint with the SEC during this conversation.

A few days later, DMHC sent Respondent the text messages that it received from the Member. After reviewing them, Respondent suspended and then terminated Complainant for soliciting assistance and possible financial assistance from a client, engaging in private communications with a client on a personal device, misleading a client to sign a HIPAA form for Complainant’s personal use, and offering to share a reward with the Member.

Complainant filed a SOX retaliation complaint alleging that he was terminated because he was about to file a complaint with a federal agency. The Administrative Law Judge (ALJ) granted Respondent’s motion for summary decision, finding Complainant failed to demonstrate that he engaged in protected activity. On appeal, Complainant argued that Respondent should have known from the text messages that he would file a complaint and that his conversation with the HR manager “hinted” that he was about to file a complaint.

The ARB’s Holding

The ARB affirmed the ALJ’s decision, finding that Complainant did not engage in protected activity. SOX protects employees who provide information, or cause information to be provided, to one of three entities: (a) a Federal regulatory or law enforcement agency, (b) any Member of Congress or any committee of Congress, or (c) a person with supervisory authority over the employee. 18 U.S.C. § 1514A(a)(1). SOX also protects employees who file or cause to be filed a proceeding, or assist in such a proceeding, with the employer’s knowledge. 18 U.S.C. § 1514A(a)(2).

It was undisputed that Complainant did not provide information to one of the three statutory entities directly. The ARB also found that his texts to the Member were not sent with any expectation that they would “cause information to be provided” to one of the entities. It emphasized that he “deliberately concealed” the text messages, which “inadvertently reached” Respondent, and that he was “quite surprised” the Member shared his texts with DMHC.

Complainant’s conversation with Respondent’s HR manager also failed to show he was “about to file” a complaint. The ARB found that the manager could not reasonably ascertain SOX-protected content from Complainant’s summary of an online article and vague references to a complaint “in the works.” It further held that, even after Respondent received the texts from DMHC, it did not, in context, establish a genuine issue of material fact as to whether Complainant engaged in protected activity. The ARB concluded that Complainant’s communications were “too attenuated and conflated with other non-SOX protected conduct to convey to a reasonable person that he was about to file a complaint protected under SOX.”


This decision highlights SOX’s and the ARB’s goal of encouraging open disclosure, rather than an employee’s attempt to use a “gotcha” strategy for his or her own benefit. The ARB focused on the fact that the employee deliberately concealed information and that the employer lacked any notice that he engaged in SOX-protected activity. Based on this decision, the ARB seems unlikely to find protected activity where the complainant fails to report to, or actively conceals information from, the appropriate entities under SOX.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Whistleblower & Corporate Internal Investigations, the Workplace Counseling & Solutions Team, or the Workplace Policies and Handbooks Team.


By Jacob Oslick and Robert Nobile

Seyfarth Synopsis:  Does Pennsylvania’s public policy preclude a nuclear power plant from terminating an employee for being drunk on the job? “No,” the United States District Court for the Middle District of Pennsylvania ruled this October

The employee, a long-time production foreman, failed a blood alcohol test in February 2018.  In response, and pursuant to a federal regulation, the nuclear plant suspended the employee’s access to the facility for fourteen days.  Before the suspension ended, the plant terminated him.

The employee sued.  The employee argued, in pertinent part, that his termination violated an alleged Pennsylvania public policy to “allow[] employees with alcohol or drug-related issues to complete treatment for first offenses before being terminated.”

The Court disagreed.  It recognized that Pennsylvania law permits common law wrongful discharge claims when an alleged termination “violate[s] a clear mandate of Pennsylvania public policy.” But, the court held, such a clear mandate has been recognized only in three limited circumstances: (1) when an employer fires an employee for refusing to commit a crime; (2) when an employer fires an employee for complying with a statutorily imposed duty; and (3) when a statute prohibits discharge.

Contrary to the plaintiff’s argument, the Court concluded that no statute or regulation required employers to forgive “first offenses,” or offer treatment in lieu of termination.  The Court further concluded that, although Pennsylvania offers state employees the opportunity to participate in substance abuse programs after a first offense, this program did not evidence any “public policy” that applied to private employers.  Accordingly, under the employment “at will” doctrine, the Court found that the nuclear plant could freely terminate the employee for failing a sobriety test.

The Court’s decision is a reminder that, while the employment “at will” doctrine is under threat, it’s not dead yet.  Providing substance abuse counseling and treatment to employees who violate drug and alcohol policies may be good personnel management.  But, all other things equal, nothing in Pennsylvania prohibits employers from simply terminating offenders.

That guidance, however, comes with a caveat: every employee has multiple protected characteristics (i.e., a sex, race, national origin, religion, etc.).  If employers terminate some substance offenders, while referring others to treatment, plaintiffs’ attorneys may be able to assert discrimination claims based upon alleged disparate treatment.  At the same time, some offenses may be worthy of termination, while others aren’t.  An employer could draw a clear difference, for instance, between a forklift driver who comes to work at three times over the legal limit, and a secretary who tests positive for marijuana.  But there are also many gray areas, which could raise factual questions in a discrimination case.  To that end, employers who run drug testing programs should draft clear, written guidelines demarcating what kind of offenses they consider terminable, and what kind of offenses warrant treatment, or a lesser sanction.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Workplace Counseling & Solutions Team or the Workplace Policies and Handbooks Team.

By Jennifer L. Mora

Seyfarth Synopsis: The Tenth Circuit Court of Appeals recently affirmed summary judgment in favor of an employer that terminated an employee after he tested positive for methamphetamines, even though he claimed that his drug test was the result of his use of an over-the-counter sinus medicine. While a favorable decision to employers, it serves as a reminder for employers to be cautious about how they elicit information from employees about prescription and over-the-counter drug use without risking a claim for an unlawful medical examination and inquiry in violation of the Americans with Disabilities Act (ADA).

The plaintiff worked as crane operator for a refinery in Oklahoma. As such, he was subject to the employer’s substance abuse policy, which provided for random and post-accident drug testing. As part of the testing process, the employer contracted with a Medical Review Officer (MRO), which, per the employer’s policy, would contact any employee after a positive test result to determine whether the employee wished to discuss the result. The plaintiff was selected for a random drug test and, three days later, was sent for a post-accident drug test. The random drug test revealed the presence of amphetamines in the plaintiff’s system, a drug that had not been prescribed to the plaintiff. However, his doctor provided a letter stating that the plaintiff had been taking over-the-counter Sudafed for unspecified “medical conditions.” The employer ultimately terminated the plaintiff for his positive test result.

The Tenth Circuit affirmed the federal district court’s grant of summary judgment to the employer on the employee’s ADA claims, which alleged disability discrimination and that the employer’s random drug test and its MRO’s questions to the employee about his drug use were impermissible medical inquiries in violation of the ADA. In affirming dismissal of the disability discrimination claims (under both “actual” and “regard as” theories), the court agreed that the plaintiff failed to prove that the employer’s stated reason for the discharge, the failed drug test, was a pretext for discrimination.

Next, the Tenth Circuit found that the test for the presence of illegal drugs was not an impermissible medical examination under the ADA, even though it potentially revealed lawful drug use. Under the ADA, an employer “shall not require a medical examination and shall not make inquiries of an employee as to whether such employee is an individual with a disability or as to the nature or severity of the disability, unless such examination or inquiry is shown to be job-related and consistent with business necessity.” However, “a test to determine the illegal use of drugs shall not be considered a medical examination.”

The plaintiff argued that because the drug test result revealed lawful drug use, the drug test was not for illegal drugs, “but went beyond that to legal and appropriate use.” He also argued that the drug test was a medical evaluation and, thus, the employer could only test if job-related and consistent with business necessity. Relying on the Equal Employment Opportunity Commission’s (EEOC) regulatory guidance, the Tenth Circuit concluded that, “[a] test for the illegal use of drugs does not necessarily become a medical examination simply because it reveals the potential legal use of drugs.”

The plaintiff also claimed that the MRO’s obtaining information about his prescriptions constituted an impermissible disability-related inquiry. The court disagreed. First, assuming the MRO even made an inquiry, the court noted that the plaintiff offered no evidence that the MRO directed any questions to any disability. Instead, the only record evidence showed that the MRO simply received information from the plaintiff about his medication. The court relied again on the EEOC’s guidance, which states that an employer is permitted to ask about lawful drug use if a person tests positive for illegal drug use and “may validate the test results by asking about lawful drug use or possible explanations for the positive result other than the illegal use of drugs.” Thus, the Tenth Circuit agreed that no unlawful inquiry occurred.

With the opioid crisis dominating the news, employers have become increasingly concerned about how the epidemic is impacting their workplaces. However, this court decision should not be interpreted as license for employers to begin inquiring about their workers’ lawful prescription and over-the-counter drug use. As we reported here, the EEOC continues to scrutinize employer policies regarding prescription drug use. In general, employees have a protected right to use prescribed controlled substances and come to work unless such use creates an undue risk of harm or presents a safety issue. Moreover, employers should take precautions before implementing blanket drug-testing policies that do not account for the need under the ADA to engage in an interactive process with individuals taking prescription medications and, if necessary, provide reasonable accommodations.

Employers also should consider revising any workplace policy that requires employees to disclose their prescription medication use, unless there is reason to believe the medication may impact performance, or otherwise suggests that employees taking such medication will be treated in a certain way without regard to whether their drug use impacts their work. Finally, employers should be mindful of the language used in a drug and alcohol testing policy, which should focus on testing for and restricting use of “illegal drugs” as opposed to “controlled substances.”

For more information on this or any related topic please contact the author, your Seyfarth attorney, or any member of the Workplace Counseling & Solutions Team or the Workplace Policies and Handbooks Team.

By James L. Curtis and Adam R. Young

Seyfarth Synopsis: The National Safety Council released a policy statement endorsing employer zero-tolerance policies for cannabis use for employees who work in safety-sensitive positions, explaining that no level of cannabis is safe.

Unlike a test for Blood Alcohol Content, testing results for Tetrahydrocannabinol (THC) metabolites (the psychoactive components of cannabis) do not directly demonstrate employee impairment.  Positive tests for cannabis can reflect past usage by an employee who is not impaired.  Because the science has not yet created a test which can definitely show cannabis impairment, several legal frameworks presume impairment from positive drug test results.  Employers have raised the question of what “levels” of marijuana metabolites are “safe” for employees at work and on duty, and how best to address positive drug test results.  The National Safety Council (NSC), a respected national body of safety professionals, released a policy statement on October 21, 2019 addressing cannabis issues.

After acknowledging that the amount of THC detectable in the body does not directly correlate to a degree of impairment, the NSC advises employers that it is unsafe to be under the influence of cannabis while working in a safety sensitive position.  “Safety-sensitive” refers to positions where drug impairment can significantly jeopardize the safety of the employee, co-workers, or third parties.  The NSC explains that any level of cannabis in the system should be unacceptable, as it leads to an increased risk of injury or death to the employee and others.

In support of its contention that employers should have a zero-tolerance policy for employees in safety-sensitive positions, the NSC cites a National Institute of Drug Abuse study that found that employees who tested positive for cannabis had:

  • 85% more injuries;
  • 55% more industrial incidents; and
  • 75% higher absenteeism rate.

The NSC further cites an Insurance Institute for Highway Safety study that found a 5.2% increase in the rate of crashes post-cannabis legalization in three states as compared to before legalization.

In its policy statement, the NSC further recommends assigning employees to non-safety sensitive positions when they use marijuana for medical reasons, as a mandatory accommodation.

As a group of safety professionals, the NSC’s primary concern is employee safety.  The organization’s recommendations may conflict with applicable laws or may require additional nuance and refinement.  Employers should consult with legal counsel before implementing the NSC’s recommendations to ensure compliance with the Americans with Disabilities Act, state cannabis laws, and other federal and state rules.

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), Cannabis Law Practice, or Workplace Policies and Handbooks Teams.