Major Amendment to Americans With Disabilities Act Signed Into Law
Recent amendments to the Americans with Disabilities Act (ADA) become effective January 1, 2009, and will significantly affect how courts apply the law. While the amendments leave the definition of “disability” largely intact, Congress made it clear that courts may not interpret that definition narrowly. In fact, the amendments expressly reject the central holdings of two major United States Supreme Court holdings which narrowed the ADA’s applicability to certain plaintiffs. Consequently, courts no longer will be able to consider the ameliorative effects of some mitigating measures, such as medication or a prosthesis. Additionally, courts are to view the ADA has having a broad scope and to recognize that the primary consideration is whether employers have complied with their obligations under the Act, rather than engaging in extensive analysis whether an employee qualifies as disabled under the ADA. These amendments likely will make it more difficult for employers to obtain summary judgment in ADA cases based on the issue of whether the plaintiff is an individual with a disability and protected by the Act and will require employers to focus their efforts on properly managing the accommodation process.
Contact for more information: Scott M. Gilbert
Employers Need Not “Play Sherlock Holmes” Under the Family and Medical Leave Act
Over the course of approximately five months, an employee engaged in a practice of either calling in sick without explanation or of sporadically submitting doctor’s notes, which seldom contained an explanation for her absences. The employee ultimately accumulated 24 unexcused absences. After unsuccessfully attempting to have the absences removed from her employment record, the employee sued under the Family and Medical Leave Act (FMLA). In rejecting the employee’s claim, the United States Court of Appeals for the Seventh Circuit stated that an employer is not expected to “play Sherlock Holmes” when it comes to determining the circumstances surrounding an employee’s absences and his or her unexpressed intent to elect leave under the FMLA. While this holding affirms that employers cannot be required to provide FMLA leave for unknown maladies, employers must take care to make certain that employees are fully informed of their leave rights and cannot ignore those situations in which an employee’s need for leave is obvious simply because the employee formally has not requested FMLA leave.
Delarama v. Illinois Dept. of Human Svs., No. 07-1156 (7th Cir., Sep. 2, 2008)
Contact for more information: Aimee E. Delaney
Broad Harassment Policy Did Not Increase Employer’s Potential Liability
During an exit interview following her resignation, an employee claimed that she was subjected to several instances of sexual harassment by her superior, some of which were allegedly witnessed by a coworker who held the same position as the employee. Both the employee and the coworker were nominally classified as “supervisors.” The employee had not filed a complaint with human resources. The employer’s voluntarily adopted sexual harassment policy broadly required all employees to report any instances of potential or actual sexual harassment, with particular compliance required of “supervisors.” The employee argued that the policy was stricter than the requirements of Title VII of the Civil Rights Act of 1964, as amended, which only required reporting by supervisor-level employees. The United States Court of Appeals for the First Circuit held that the employer’s policy should not impose increased Title VII liability against the employer, lest it “discourage and penalize voluntary efforts which go beyond what the law requires.” Despite this holding, employers must carefully draft all provisions within an employee handbook, as some courts could hold that they create contractual obligations which may exceed their obligations under the law.
Chaloult v. Interstate Brands Corporation, No. 07-2694 (1st Cir., Aug. 28, 2008).
Contact for more information: Paul J. Cherner
Strict Compliance With the 1,250-Hour Threshold Required Under the FMLA
A postal worker was terminated for taking unscheduled leave. The employee had been suspended several times for poor performance, and continued to have unexcused absences. After her termination, the employee filed suit under the Family and Medical Leave Act (FMLA), alleging that her absence was caused by an arthritic knee and that she was entitled to the leave under the FMLA. The employer responded by submitting payroll documents establishing that the employee had only worked 1,248.8 hours during the previous 12 months. The FMLA requires that an employee work at least 1,250 hours during the preceding 12-month period in order to qualify under the Act. The employee argued that she should be credited with the two work hours she missed when her supervisor ordered her to clock out early. The United States Court of Appeals for the Seventh Circuit rejected that claim, holding that the employee had failed to timely file a formal grievance about the insubordination incident and that her “unsubstantiated subjective belief that her two-hour suspension was wrongful” was insufficient. Employers should be aware that courts require strict compliance with FMLA’s 1,250-hour minimum, and it is therefore critical for employers to maintain well defined FMLA policies and accurate time and attendance records.
Pirant v. U.S. Postal Service, No. 07-1055 (7th Cir., Sep. 4, 2008)
Contact for more information: Thomas Y. Mandler
Nurse Working for Three Separate Staffing Agencies at Same Hospital Entitled to Overtime
A hospital used three staffing agencies, each of which directly employed and paid the hospital’s certified nursing assistants (CNAs). One CNA never worked more than 40 hours per week for any single referral agency, but did work in excess of 40 hours per week at the hospital for several weeks as a result of assignments from the different staffing agencies. She sued under the Fair Labor Standards Act for unpaid overtime. The United States Court of Appeals for the Second Circuit held that the hospital was a joint employer with each of the staffing agencies and responsible for overtime compensation under the Fair Labor Standards Act. Applying an economic realities test, the court found that: (1) the employee worked on the hospital's premises using hospital equipment; (2) the employee performed work integral to the hospital's operation; (3) the employee’s work responsibilities remained the same regardless of which agency referred her for a particular assignment; (4) the hospital effectively controlled the onsite terms and conditions of employment; and (5) the employee worked exclusively for the hospital. The court found significant the degree of control the hospital exercised over the hiring and firing of agency employees. That detail reinforced the fact that the hospital exerted sufficient "functional control" of the agency-referred workers to be treated as the “joint employer". This case demonstrates the need for an employer which utilizes temporary agencies to recognize the liabilities it might incur as a joint-employer under certain statutes. Employers utilizing multiple staffing agencies also must take steps to make sure that employees are paid for overtime hours worked in the aggregate even when they work no more than 40 hours in a week for any one agency.
Barfield v. New York City Health & Hospital Corporation, No. 60-4137 (2nd Cir., Aug. 8, 2008)
Contact for more information: Tom H. Luetkemeyer
New Federal Rule of Evidence Designed to Limit Rising Cost of Discovery
On September 19, 2008, President Bush signed into law a bill adding a new rule (Rule 502) to the Federal Rules of Evidence. Rule 502 protects against the inadvertant waiver of attorney-client privilege and work product. It was enacted in response to the concern that the law on waiver of privilege and work product is significantly driving up the cost of discovery given the volume of information that is now electronically available. It will apply in all proceedings commenced after its enactment and “insofar as it is just and practicable,” in all proceedings pending on the date of its enactment. Rule 502 provides that the inadvertant disclosure of privileged or protected communications or information, when made in a federal proceeding or to a federal office or agency, does not operate as a waiver in any other federal or state proceeding if the holder of the privilege took: (1) reasonable steps to prevent such a disclosure, and (2) reasonably prompt steps to retrieve the mistakenly disclosed information. Rule 502 further specifies that a federal court order providing that a disclosure of privileged or protected information does not constitute a waiver is enforceable in any subsequent federal or state court proceeding. Moreover, the parties’ agreement is not a prerequisite to the enforceability of such an order which would be enforceable against third parties. The Rule also has limited applicability when the inadvertent disclosure initially occurs in a state court proceeding as there is no similar state court order addressing the issue of waiver. In that scenario, the disclosure of privileged information does not operate as a waiver in a subsequent federal proceeding if the disclosure would not have constituted a waiver under Rule 502 had the disclosure occurred in a federal proceeding or if it does not constitute a waiver under the law of the state where the disclosure occurred. Rule 502 does not, however, address the issue of whether the inadvertent production of privileged or confidential material in one state court proceeding can be used in other state court proceedings. That issue still is exclusively governed by state law. While Rule 502 does not provide employers with the greatest amount of protection against inadvertant disclosures, it should make it easier to maintain privileged information during the course of litigation and in the future.
Contact for more information: Steven M. Puiszis
Replacement Workers Were Permanent Despite At-Will Clause in Employment Applications
A union, on behalf of bargaining unit employees, initiated an economic strike in response to stalled contract negotiations. The company hired replacement workers and required each to complete a job application that included an at-will employment clause. A few months later, the strikers made an unconditional offer to return to work. The company refused to reinstate the strikers immediately because all positions were filled. The union filed an unfair labor practices complaint, alleging that the replacement workers were “temporary” and, therefore, could not displace economic strikers. The union pointed to the at-will provision within the employment applications as evidence that the company and replacement workers did not consider the replacements’ status to be permanent. The National Labor Relations Board (NLRB) disagreed with the union and found that the company proved it had a “mutual understanding” with the strike replacements that their employment was permanent. The United States Court of Appeals for the Seventh Circuit affirmed the NLRB’s decision. Considering the totality of the circumstances, the Seventh Circuit held that an at-will employment clause does not necessarily establish that replacements are “temporary.” The court cautioned, however, that employers attempting to use the at-will status to manipulate the replacement procedure (e.g. by selectively reinstating favored strikers), will be precluded from establishing that the replacement workers were “permanent.”
United Steel Workers v. NLRB, No. 07-3885 (7th Cir., Sep. 15, 2008)
Contact for more information: Jonathon Hoag
Lack of Cooperation Legitimate Basis for Termination
An Artistic Director filed suit, alleging that the board of directors terminated his employment because of his race and national origin. In response, the board explained that it fired the Director because of his continued unwillingness to cooperate with the board and other staff members. The board provided evidence that it had to reprimand the Director because he agreed to promote another musical organization that was a potential competitor. Instead of agreeing to correct his conduct, the Director told the board that it should not question his actions. The Director’s response prompted board members to discuss removing him. At the next board meeting, the Director gave the board an ultimatum about changing the organization’s structure. The board in turn terminated his employment. The United States Court of Appeals for the Eighth Circuit stated that the employer established a legitimate, nondiscriminatory reason for dismissing the Director inasmuch as it honestly believed he would not accept the board’s authority. This case is a reminder to employers as to the importance of being able to establish the basis behind personnel decisions.
Montes v. Greater Twin Cities Youth Symphonies, No. 07-1088 (8th Cir., Aug. 28, 2008)
Contact for more information: Clay M. Ullrick
Constructive Discharge Claim Allowed for Disabled Worker Who Was Denied Accommodation
A cashier who suffered from arthritis requested that her employer allow her to use a stool at work or meet with her to discuss other potential accommodations. The employer turned down the employee’s suggestion of using a stool at work and then made itself unavailable for further discussion. The employee quit her job and sued the employer, claiming that it had taken an “adverse action” against her under the Americans with Disabilities Act (ADA). Although the trial court held that the employee had “abandoned” her job and could not prove constructive discharge, the United States Court of Appeals for the Sixth Circuit disagreed and stated that a jury could find that the employer’s actions were intended to make the former employee quit. The court noted that it did not intend to pave the way for an employee to assert a claim for constructive discharge every time an employer fails to accommodate a disability. However, when an employee makes repeated requests for an accommodation, and the request is denied and no other reasonable alternative is offered, a jury could conclude that the employee’s resignation was both intended and foreseeable. This case demonstrates the importance of an employer’s involvement in the accommodation process.
Talley v. Family Dollar Stores of Ohio, Inc., No. 07-3971 (6th Cir., Sep. 11, 2008)
Contact for more information: Justin M. Penn
Providing Unredacted Medical Records to EEOC Was a Legitimate Reason for Firing
A 49-year-old African-American employee at a retirement care facility complained to the Equal Employment Opportunity Commission (EEOC) of violations of Title VII of the Civil Rights Act of 1964, as amended. She provided several unredacted medical records to the EEOC in an effort to show that records kept by a younger, white employee contained more errors than her records, but that the white employee was not disciplined. Upon learning of the disclosures to the EEOC, the employer fired her. The employee sued her former employer for retaliation under Title VII, claiming that her production of medical records to the EEOC was protected activity. While the United States Court of Appeals for the Tenth Circuit agreed that the employee was engaged in protected activity in producing unredacted medical records, it held that the employer nonetheless had a legitimate and facially nonretaliatory reason for its decision to terminate the employee. Specifically, the court noted that the employer had a policy prohibiting the disclosure of confidential information without authorization. This case demonstrates the importance of an employer maintaining well-defined work rules that govern important areas of job performance.
Vaughn v. Epworth Villa, No. 07-6005 (10th Cir., Aug. 19, 2008)
Contact for more information: Linda K. Horras
This newsletter has been prepared by Hinshaw & Culbertson LLP to provide information on recent legal developments of interest to our readers. It is not intended to provide legal advice for a specific situation or to create an attorney-client relationship.