New Waive? NLRB Allows Revised Arbitration Agreements After Collective ActionLast week, the National Labor Relations Board (NLRB) issued a decision in Cordúa Restaurants, Inc., that permits employers to create and enforce arbitration agreements with collective waivers in direct response to Fair Labor Standards Act (FLSA) collective actions filed by employees. The NLRB also found that warning employees of discharge for failure to agree to an arbitration agreement is not a violation of the National Labor Relations Act (NLRA). This decision follows the Supreme Court’s May 2018 ruling in Epic Systems Corp. v. Lewis, that approved the employer’s use of mandatory arbitration agreements with class action waivers. Check out our prior blog posts on Epic and arbitration clauses.

What happened in Cordúa?

A group of employees filed a collective action alleging violations of federal and state wage laws.  After the lawsuit was filed, the employer required its employees to sign a revised arbitration agreement that prohibited employees from filing collective actions and opting in to collective action suits. The NLRB found that the employer had lawfully implemented the arbitration agreement under Epic Systems. The NLRB also found that requiring employees to agree to arbitrate rather than pursuing collective action (and face potential termination if they don’t agree) is lawful.

What does this mean for employers?

The NLRB has said that employers can mandate that employees sign arbitration agreements even after litigation has begun and can lawfully terminate employees if they refuse to sign such an agreement. While last week’s NLRB decision signals a positive shift in favor of employers, courts may still scrutinize arbitration agreements enforced in response to collective action lawsuits and any disciplinary actions taken by employers against employees who refuse to sign an arbitration agreement.

Teach Your Children Well: DOL Issues Opinion Letter that Attending Child’s IEP School Meeting Is Covered by FMLAIf an employee asks for time off to attend a meeting at his or her child’s school, is that covered by FMLA? Maybe not but it depends on the nature of the meeting. If the child is disabled and the school meeting is for the child’s IEP, according to a recent opinion letter from the Department of Labor (DOL), it may be covered FMLA leave.

What is an IEP?

An IEP is an Individualized Education Program for a child in school who may need assistance because of a disability that affects his or her education. Federal law requires schools to develop an IEP for every student that meets the federal and state requirements for special education. As part of the process of establishing an IEP, school personnel meet with the parents (and sometimes the student, depending on age) to design the plan and talk about how it will work.

Why Should a Parent/Teacher Meeting Be Covered by the FMLA?

The DOL was approached by a parent who had two children with qualifying serious health conditions under the FMLA. The mother applied, and her employer approved intermittent FMLA leave for her to care for her children and take them to medical appointments. However, the employer had denied leave for the IEP meetings at the school that occurred four times a year. The mother argued that the children received pediatrician-prescribed occupational, speech, and physical therapy provided by the school district, and the IEP meetings involved speech pathologists, psychologists and therapists, as well as teachers and school administrators, to talk about these services and the children’s progress and areas of concern. The mother wanted to know if intermittent FMLA leave could cover the meetings.

The DOL opinion letter discussed the right of a parent to take intermittent or reduced FMLA leave when it was medically necessary because of a family member’s serious health condition. The DOL flatly said that the mother’s need to attend the IEP meetings addressing the educational and special medical needs of her children, who have serious health conditions as certified by a healthcare provider, is a qualifying condition for taking the FMLA leave. The opinion notes that the FMLA covers taking leave for making medical decisions on behalf of a hospitalized parent or to make arrangements for finding suitable childcare for a child with a disability. The DOL also cited Wage and Hour Division policy providing that FMLA covers care conferences where the employee’s attendance at the conference is “clearly essential to the employee’s ability to provide appropriate physical or psychological care to a qualifying family member.”

How Does This Affect Us?

This decision shows that situations may arise around the edges of what we consider “typical” FMLA leave—especially when it deals with leave taken to care for another individual. The important facts in this scenario appear to be:

  • The children had a qualifying serious health condition that was documented by a healthcare provider. The mother was already taking intermittent leave related to these children.
  • The IEP meetings were directly related to that medical condition. According to the opinion letter, the occupational, speech, and physical therapy were prescribed by a doctor, provided by the school, and discussed at the IEP meeting.

While it is wise to be ever-vigilant when monitoring possible abuses of FMLA, if the request relates to the care of someone with a previously documented serious health condition, it may be best to err on the side of granting the leave.

The Door Gets a Little Wider: D.C. Circuit Rules Employee-Plaintiff Can Get Comparator Discovery to Prevent Dismissal of CaseIf your employee sues you for discrimination, they don’t get to look at how the decision-makers treated everyone else, do they? Well, in Cruz vs. US Homeland Security, the D.C. Court of Appeals says yes they do. Although the district court granted summary judgment and did not let the plaintiff take discovery on how her bosses treated others, the court of appeals said not so fast. The ruling allows plaintiffs potentially to cast a wider net for information.

Coworker Complains and Plaintiff Reassigned

Elisa Cruz, an African American female of Hispanic descent, was Chief Information Security Officer for FEMA’s Office of the Chief Information Officer (OCIO). In 2012 a white male coworker complained that Cruz behaved inappropriately at multiple meetings. The head of OCIO (a white female), directed Cruz’s immediate supervisor, Maria Roat (a white female), to investigate. Ms. Roat got help from HR, who performed a “limited administrative inquiry.”

Ms. Roat and HR determined that Cruz engaged in unprofessional behavior (described as “abrasive, rude, yells, and [] condescending”) and she should receive a written warning and be reassigned (with fewer direct reports). They reassigned Cruz within DHS’s headquarters for 90 days, with no change in pay. Cruz filed an internal EEO complaint alleging discrimination based on race, color, national origin, and sex. Following that complaint, her reassignment was extended and then she was reassigned to a position outside the branch for which she did not believe she was qualified. She amended her administrative complaint to include a retaliation claim. The internal process and a later EEOC charge were concluded with no finding of discrimination.

Discovery Sought, Trial Court Denies

Cruz filed a lawsuit, and DHS filed an answer. Three weeks later, DHS moved for summary judgment, before any discovery had taken place. In response to DHS’s motion, Cruz argued that the motion was premature and she should be allowed to take discovery regarding the head of OCIO and Ms. Roat’s conduct towards and handling of other employees (both those in protected categories and not) for comparator evidence to support her claim of discrimination.

The district court granted the motion, finding that DHS’s stated reason for the reassignments was not pretextual and that the discovery Cruz sought was “extremely unlikely” to create any factual dispute regarding pretext.

Court of Appeals Reverses

The D.C. Circuit disagreed, finding that Cruz was entitled to at least look at the comparator evidence. The court found that how the decision-makers treated other employees who did not share Cruz’s protected characteristics in the same circumstances was relevant. Even though, according to the lower court, DHS had “strong evidence” to support its actions, including an independent investigation, the court held that the comparator evidence was material to the issue of pretext.

Takeaways

Discovery fights over comparator evidence are not uncommon. Although an employer can seek to limit disclosure on multiple bases (e.g., burden, confidentiality and privacy of others, or the requests being a “fishing expedition”), the D.C. Circuit’s opinion will give support to a claimant seeking such comparator evidence. How should you prepare?

  1. Look for comparators when you make the employment decision. Before disciplining or terminating an employee, be sure you have treated others in similar situations similarly. Look at how the decision-maker has treated similar situations and then look a little more broadly at how such situations have been handled throughout the company (within reason). Consistently applied policies are always welcome in defending a discrimination claim.
  2. Once you are in litigation, you and your counsel should thoughtfully evaluate discovery requests seeking comparator information. You may find that the comparators help your case. In any event, if the comparator information can go towards the issue of pretext (either for or against you), object and defend appropriately.