When Off-the-Clock Isn’t Off-the-Clock: The Seventh Circuit Considers Employees’ Arguments that Employer Violated the Fair Labor Standards Act by Not Paying Overtime for Off-Duty Use of Work-Issued BlackBerrys

Blackberry phone

Remember that collective action that the Chicago police officers filed complaining that they weren’t paid overtime for checking their BlackBerrys off duty? Well, the cops lost at trial and now the U.S. Court of Appeals for the Seventh Circuit has it. Recall that 54 officers from the Bureau of Organized Crime Unit filed a collective action that the Chicago Police Department had a policy of not paying overtime to some police officers for their off-duty use of their work-issued BlackBerrys. The officers argued that the city issued the BlackBerrys based on the premise that the officers would always be available to answer e-mails and phone calls.  During a weeklong bench trial before U.S. Magistrate Judge Sidney I. Schenkier, officers testified that they feared repercussions if they submitted overtime requests for off-duty answering of e-mails and phone calls and that such requests were frowned upon. At trial, the Department offered two approved time slips—indicating that the Department did not discourage the requests and paid them. The officers’ attorney later argued that the evidence of two time slips was conveniently timed – the approvals “all seem to have magically happened just in advance of the trial”.  Judge Schenkier, however, held that the police officer’s claims did not rise to the standard set by the Fair Labor Standards Act.

The city and the officers are currently arguing their case before the Seventh Circuit in Allen v. Chicago (case no. 16-1029).  The city filed a brief Tuesday night, arguing that the department did not have either a written or an unwritten policy that refused to compensate police officers for either answering phone calls or e-mails on their work-issued BlackBerrys. Additionally, the city argued that the “intentional failure to report overtime in accordance with an employer’s reasonable timekeeping procedures preclude[ed] an FLSA claim for unpaid overtime”. Employers who have nonexempt employees with 24-7 email or telephone access should watch closely to see if the Seventh Circuit agrees.

Check Your Dress Codes and Decide If You Really Need One (Or Want to Enforce It)

PeopleDress codes—a helpful workplace rule or a trap for the unwary? A recent Forbes article (High Heels and Workplace Dress Codes: Urgent Action Needed, Say U.K. MPs) relates the story of Nicola Thorp, who was sent home from her receptionist job at an accounting firm in London because she was not wearing at least a 2” heel. She thought her formal flats were sufficiently business-like but her employer disagreed and sent her home without pay to change. This sparked a discussion in Parliament.

As we emerge from the year end “let’s update that employee handbook” season, I want to encourage you to look at your dress code. At the outset, I want to make clear I am not talking about dress codes that require particular safety equipment or a uniform. Those kinds of dress codes are typically defensible, even if you have some different standards for men and women. I want to address the policies that are not safety driven or about making sure customers can identify the employee in the room.

In the spirit of full disclosure, I admit that I am a “less is more kind of lawyer” when it comes to policies. I tend to think you don’t need a complicated dress code because you will never cover everything anyway. My preferred dress code policy looks like this:

We expect you to be and look professional, coming to work in clothing that is neat, clean and appropriate for our work.  If you are not dressed appropriately, we will talk with you about it and ask you to change, which could include going home.

I think this policy encourages supervisors and managers to talk to their direct reports and coach them about appearance—which is typically part of how to be a successful employee. Does that open the door for supervisors to enforce the policy unevenly? Yes, but probably not any more unevenly that that supervisor already enforces the detailed dress code.

If you don’t want the less is more dress code, what should you do? Rule One: Enforce the dress code consistently. Dress codes are bright lines so you have to be sure that they are rigidly enforced. Rule Two: Forget about Rule One when an employee requests a reasonable accommodation for a disability or religious belief.

Beyond those rules, I think you can tell your employees that they need to project a certain image (e.g., no extreme hairstyles, limited piercings or tattoos, etc.) if you want, although you could still get a challenge [School of Hard (Dread) Locks: EEOC Loses Appeal Over Hairstyle Ban]. Once you get into varying standards for men and women, you may be able to enforce it but you are asking for a challenge—based on sex, gender stereotypes, or gender identification. Be careful and only have rules for which you want to go to the mat.

With that said, here are a few dress code provisions that will almost certainly get you in trouble:

  1. Women’s skirts should be no more than __ inches above the knee. The first time I saw this provision (when I still wore skirts above my much younger knees) the proscribed length was 4” above the knee. I thought that could end up being pretty short (depending on how tall you are). More importantly, the last thing I wanted was a supervisor measuring a skirt (mine or anyone else’s). Not surprisingly, this policy was selectively enforced (which is how it landed on my desk in an EEOC charge). Just say skirts should not be too short or revealing—then address problems.
  2. No earrings on males. Once you raise a different standard for men and women, you could get a challenge. Think about whether it would be just as effective to limit all earrings to one per ear that don’t drop below the ear lobe. If you want to prohibit earrings on males, just be sure it is important to your business.
  3. No jewelry (except a wedding ring). It’s the “except” that gets you in trouble. This is clearly not a safety concern (because a wedding ring would present the same safety issue). It opens you up to challenges (e.g., my nose ring is part of my religious observance, my promise ring to my same sex partner, etc.). Do you really need the except?
  4. Employees must wear appropriate undergarments. Okay—this wasn’t actually in a corporate dress code, it was in the dress code for the maximum security prison I visited last month. However, if your dress code doesn’t say that people have to wear appropriate undergarments, does that mean the woman who is obviously unencumbered by a brassiere (much to the chagrin of her female coworkers) doesn’t have to wear one? Of course not. If your dress code talks about being professionally or appropriately dressed, talk with the employee about what you expect.

Why is this so hard? Because we want our employees to convey a certain look—it may be professional or tech or casual—but we want a look. We also, curiously, are all talking about diversity—which is kind of the antithesis of the conformity that a dress code suggests.

So—save yourself some grief and come up with a dress code that does what you want it to do and enforce it—or chuck it altogether.

Anxiety, Absenteeism, and the ADA

Telemarketer and supervisorAs accommodating and flexible as the Americans with Disabilities Act (ADA) compels employers to be, the harsh reality is that there are some jobs that a person with certain disabilities simply cannot do. When an employee suffering from a disability can no longer perform the essential functions of her job with or without a reasonable accommodation, the ADA allows her employer to terminate her. Although this rule may be more easily applied when dealing with a physical disability that prevents an employee from completing critical tasks, it also holds true for an employee with a mental or emotional disability, particularly one that prevents her from working at all. The Sixth Circuit made this crystal clear in Williams v. AT&T Mobility Services LLC.

The Williams case involved an AT&T customer service representative (CSR) who suffered from depression and anxiety attacks that caused her to frequently miss work. Because of her excessive absenteeism, AT&T terminated Williams for job abandonment and violating the attendance policy. Williams sued AT&T under the ADA for failing to provide a reasonable accommodation, failing to engage in the interactive process, and terminating her based on her disability. The U.S. District Court for the Western District of Tennessee granted summary judgment to AT&T as to all of Williams’s claims. Williams appealed, arguing that she could have performed her job despite her depression and anxiety attacks if AT&T had given her leave from work for treatment, flexible scheduling, and additional breaks during her shifts. The Sixth Circuit disagreed.

First: Regular Attendance Was an Essential Job Function.

Citing EEOC v. Ford Motor Co., the Sixth Circuit first explained that regular attendance qualified as an essential job function, so employees with excessive absences were not qualified individuals under the ADA because they failed to perform that essential function (i.e., regularly attend their jobs). Considering AT&T’s strict Attendance Guidelines and declarations from two AT&T managers regarding the CSR position, the Sixth Circuit held that regular attendance was an essential function of the CSR position. The court noted Williams’s poor attendance record, including being absent from work for entire months in two different years, taking a six-month leave and nearly three-month leave, and not getting her unscheduled absences approved for short-term disability leave. Given this record, the Sixth Circuit held that Williams could not perform the essential function of regularly attending her job and was not qualified to be a CSR without a reasonable accommodation.

Next: Williams Did Not Request Reasonable Accommodations.

Because Williams failed to show how her proposed accommodations would have enabled her to perform the essential functions of a CSR, the Sixth Circuit also found that AT&T did not fail to accommodate her. Williams admitted that her anxiety attacks were unpredictable, she could not perform her job duties during her attacks, she could not function in a call center environment, and she could not focus due to her mental illness. Importantly, neither Williams nor her health care providers explained how flexible scheduling and additional breaks would have mitigated these issues and enabled Williams to do her job. Furthermore, the Sixth Circuit held that requiring AT&T to grant Williams additional leave was an unreasonable accommodation because Williams had a history of taking leaves, her condition never improved during those leaves, and she repeatedly failed to return to work when her health care providers estimated that she would be able to return.

After reiterating that an employer’s failure to engage in the interactive process is only actionable if the employee can demonstrate that she was qualified for the position, the Sixth Circuit stated that it was unnecessary to consider whether AT&T failed to engage in the interactive process because Williams was unqualified for her position as a CSR with or without a reasonable accommodation. The court also agreed with the district court that Williams failed to establish a prima facie case of disability discrimination or retaliation and affirmed the district court’s summary judgment ruling in favor of AT&T.

Takeaways.

So, what is the Sixth Circuit telling us about how to deal with a mental disability that prevents an employee from coming to work? First, clearly articulate the essential functions of an employee’s job, preferably in writing (e.g., job description, employee handbook), and be sure to mention attendance is essential. Second, assess whether the employee is performing the essential functions of her job (including coming to work), being sure to document and promptly inform the employee about deficiencies. Third, discuss whether there are any reasonable accommodations available that would allow the employee to do her job. Ask for recommendations from the employee’s health care providers during this interactive process. If you and the employee (and the employee’s doctor) cannot come up with a reasonable accommodation that does not eliminate an essential job function of the position (i.e., coming to work), and you do not have a vacant position in which you can reasonably accommodate her, you may have to terminate the employee. Although handling this type of issue may take some time, in this case the Sixth Circuit declared that AT&T did all that the ADA required. Employers should follow its example.

Don’t Go Changing: White House Keeping Obama LGBTQ Order in Place

Man withdrawing wooden card painted as the gay pride flagOver the weekend several media outlets reported that a draft executive order was being circulated that overturned President Obama’s 2014 directive prohibiting federal employers and contractors from discriminating on the basis of sexual orientation and gender identity in the federal workforce and by federal contractors.  Executive Order 13672, which was signed on July 21, 2014, amended Executive Order 11478 — which was previously amended in 1998 by Executive Order 13087 to prohibit discrimination on the basis sexual orientation in the competitive service of the federal civilian workforce– to include gender identity.  It also amended Executive Order 11246 to prohibit discrimination based on sexual orientation and gender identity by federal contractors.

On Tuesday, the White House issued a statement, announcing that the “executive order signed in 2014, which protects employees from anti-LGBTQ workplace discrimination while working for federal contractors, will remain intact.”  As reported by the Washington Post, the Trump administration’s statement regarding Executive Order 13672 is significant because the executive order affects approximately 24,000 companies, employing 28 million workers, which represents 20% of the United States workforce.

New Acting Bosses at EEOC and NLRB: Familiar Faces Bringing Big Changes?

All hands together, racial equality in teamIn the last several days, President Trump has elevated individuals to head two of the governmental agencies that shape employment law. First, Philip Miscimarra was promoted to be the acting chair of the National Labor Relations Board (NLRB) which is charged with enforcing the National Labor Relations Act. Mr. Miscimarra was originally appointed to the Board by President Obama in 2013. Prior to the Board, Miscimarra was a labor & employment lawyer in private practice.  Second, Victoria Lipnic was named acting chair of the Equal Employment Opportunity Commission, the agency that handles and occasionally litigates charges of employment discrimination. She likewise was appointed by President Obama in 2010 (and then again in 2015) after a career in private practice and several years with the Department of Labor in the Bush Administration.

What does this mean as far as changes in the labor and employment landscape? Hard to say this early. Since both are insiders in their respective organizations, it is unlikely that they will implement radical structural change for either agency. Mr. Miscimarra has expressed displeasure with some of the NLRB’s recent rulings striking down communication and social media policies in employment handbooks. He also has written dissenting opinions favoring more confidentiality in workplace investigations—especially in harassment cases.

Ms. Lipnic dissented in cases holding that sexual orientation is covered by Title VII’s prohibition on sex discrimination. She also voted against, and has been publicly critical of, the new EEO-1 data form that would include pay information. Data should start being collected under that form this Spring and will be filed in Spring 2018, so it will be interesting to see if she has the EEOC change position on that data collection.

Why Not Ask About Prior Pay? It’s Against the Law in Some Places and Dangerous Everywhere

Businessman Giving Cheque To Other PersonSetting a new employee’s pay based on what he or she made at a prior job is a fairly common practice—but now an illegal one in Philadelphia, PA. You heard right, Philadelphia has banned questions about salary history. This local law follows a Massachusetts law (similar but not identical) aimed at closing the pay gap between women and minorities and their white male counterparts.

But you don’t have employees in Philadelphia (or Massachusetts). More importantly, you don’t set pay based on race or gender and recognize that to do so would violate Title VII of the Civil Rights Act of 1964. I want to remind you that it would also violate the Equal Pay Act of 1963 (EPA), which provides:

No employer . . . shall discriminate . . . between employees on the basis of sex by paying wages to employees in such establishment at a rate less than the rate at which he pays wages to employees of the opposite sex in such establishment for equal work on jobs the performance of which requires equal skill, effort, and responsibility, and which are performed under similar working conditions, except where such payment is made pursuant to (i) a seniority system; (ii) a merit system; (iii) a system which measures earnings by quantity or quality of production; or (iv) a differential based on any other factor other than sex . . .

Unlike Title VII, the EPA doesn’t require the employee to establish intent to discriminate—merely that she is paid less than a male comparator.

Why am I boring you with what you already know? I’m glad you asked.

Nearly every Equal Pay Act claim I have defended was about a female employee who was paid less than a male counterpart and her wage was set based on her prior employment. In one particularly frustrating set of facts, my client was sued for pay discrimination under Title VII (based on race and sex) and the EPA (based on sex). She was in a job classification that had about 15 women and 2 men. There was a pay range and all of the employees fell within it. The plaintiff, who was a slightly less than average performer, was in the bottom half of the crowd. The two men were not the highest paid, in fact one of the men made less than the plaintiff. The highest paid people in the group were women and were the same race as the plaintiff. We got summary judgment on the Title VII claims—but not on the EPA claim.

To establish her EPA claim, the plaintiff only had to show that one man was doing the same job and being paid more. That he was paid only a little more (less than a dollar an hour) and within the pay range didn’t matter. That there were lots of women paid more than him didn’t matter. We explained that the reason he was paid slightly more was because when we set salaries, we considered prior pay. The male comparator was making slightly more than the plaintiff in his prior job, so he started at a slightly higher pay. Summary judgment denied.

Don’t let this happen to you. Even if you can ask about prior pay, be careful how you use it. Make sure employees doing the same job are making the same pay or that you can explain why they aren’t. You can make pay distinctions because someone has been with the company a long time (seniority), gets better performance evaluations (merit), or produced more (quality or quantity of production). Make sure it is not simply based on what they made in their last job.

Class Warfare: Supreme Court Agrees to Hear Cases on Arbitration Class Action Waivers

Business man signing a contract

The NLRB wants to stop class action waivers in employment arbitration agreements, arguing they violate the National Labor Relations Act. This issue has been raging for several years and divided federal courts. As reported in our November 2, 2015, blog post, the Fifth Circuit Court of Appeals upheld a class action waiver in the important Murphy Oil case. Undaunted, the NLRB has asked the U.S. Supreme Court to review the issue and the high court has agreed to do so in a series of three cases, one of which is Murphy Oil.

What does this mean for employers? If the Supreme Court holds that class action waivers are enforceable in employment arbitration agreements the NLRB’s attack on this issue will end. However, if the Supreme Court rules in favor of the NLRB, the decision could have far reaching impact on employers’ use of class action waivers in arbitration agreements. Such waivers are often the saving grace for employers facing costly class or collective action lawsuits as the class allegations fall away when the employer compels arbitration and then asserts the class waiver provisions. Without such provisions employers should brace for more employment class actions. If you have those waivers or are considering implementing them, keep an eye on this case, including whether President’s Trump’s choice for a ninth justice will be seated in time to participate in the decision.

 

C’est La Vie: No ‘Right to Disconnect’ in U.S., But Non-Exempt Workers Must Be Paid for ‘Connected’ Time

Digital displays surrounding us from everywhereCould a “right to disconnect” become law in the U.S.? France is trying it. Effective January 1, a new French law went into effect giving workers a “right to disconnect” when not at work. French employers with 50 or more employees have to adopt written policies restricting the hours that workers can send or receive emails, text messages, or any other digital, work-related communication. The new law is meant to allow workers to escape from the pressure to always monitor company emails and give them the legal right to ignore their work emails while off the clock, as well as truly give them an opportunity to unwind.

In the U.S., there has been no reported discussion from state or federal legislators about actually implementing a similar “right to disconnect.” However, that does not mean off-the-clock employees are without rights, as a 2015 lawsuit in U.S. District Court seemed to reinforce.

Even without a formal “right to disconnect,” non-exempt employees have a right to be paid for their work—even work-related communications while off-the-clock. In addition, all of that off-the-clock time checking and sending work-related emails and text messages must be counted toward the 40-hour-per-week overtime threshold and may have to be paid at an overtime rate. Failure to do so can lead to costly wage litigation, liquidated damages, and attorneys’ fees.

There are tools to help eliminate risks from off-the-clock work related to emails and texts. Employers should implement a policy specifically prohibiting non-exempt employees from working while off the clock, including an express bar on checking or responding to company emails and text messages while clocked out. The policy should also require non-exempt employees to report such off-the-clock time so they can be compensated for it. Your policy can still provide that non-exempt employees who perform off-the-clock work or who work overtime without authorization will be disciplined. However, employers cannot withhold pay as a consequence of violating the policy. Employers should also train their managers and supervisors not to send emails and text messages to non-exempt employees when they’re not at work to try and avoid the legal pitfalls that can result.

So while there’s no legal “right to disconnect” in the U.S., employers may want their non-exempt employees disconnecting to avoid troublesome wage-and-hour issues.

Obama Trumped? Top Five Trump Targets of Executive Orders Include Employment-Related Obligations

The White HouseEmployers that contract with the federal government are about to face a whole new ballgame with the Trump Administration. In Trump: The Art of the Deal, Mr. Trump explained that deals are his “art form” and that making big deals is how he gets his “kicks.” President Obama issued many executive orders and presidential memoranda that imposed new restrictions and requirements on government contractors, and Trump has made clear that he takes a dim view of them. Trump’s “Contract with the American Voter” provided that he would “cancel every unconstitutional executive action, memorandum and order issued by President Obama” and his campaign website promised to “[c]ancel immediately all illegal and overreaching executive orders.”

With all of this in mind, federal contractor employers should expect the Trump administration to negotiate deals, both in style and substance, differently from those of the Obama administration. What will government contracting be like with the Trump Administration? We believe these Obama executive orders will be among the “First Five to Dive” under a Trump administration:

  1. Executive Order 13495: “Nondisplacement of Qualified Workers Under Service Contracts.” This was one of President Obama’s first executive orders, signed January 30, 2009. It requires a new federal contractor to offer jobs to workers employed by the outgoing contractor. It effectively gives the workers a right of first refusal to obtain jobs with the new contractor. Opponents say that this order limits the efficiency of new contractors.
  2. Executive Order 13502: “Use of Project Labor Agreements for Federal Construction Projects.” A project labor agreement (PLA) is a pre-hire collective bargaining agreement with a union that establishes the terms and conditions of employment for a construction project. President Obama signed this order on February 6, 2009, to require the use of PLAs on all federal construction projects valued at $25 million or more. Critics say that the order increases federal construction costs and limits the competitiveness of non-union contractors.
  3. Executive Order 13673: “Fair Pay and Safe Workplaces.” This order, signed by President Obama on July 31, 2014, requires prospective federal contractors to disclose labor law violations. Government officials are then required to consider a prospective contractor’s violation history when awarding contracts. The order also bars contractors from imposing pre-dispute arbitration agreements on their employees. Several companies sued to block implementation of this order, and on October 24, 2016, a federal district court in Texas sided with the employers against the Obama administration.
  4. Executive Order 13706: “Establishing Paid Sick Leave for Federal Contractors.” President Obama signed this order on September 7, 2015. It mandates that federal contractors allow employees at least one hour of paid sick leave for every 30 hours worked. The House Freedom Caucus has notified Trump’s transition team that this order needs to be rescinded. The Freedom Caucus also wants Trump to rescind Executive Order 13658, “Establishing a Minimum Wage for Contractors,” which sets a $10.10 minimum wage for the employees of federal contractors.
  5. Executive Order 13665: “Non-Retaliation for Disclosure of Compensation Information.” This order prohibits federal contractors from taking adverse employment actions against employees who disclose compensation information to other employees. President Obama signed the order on April 8, 2014. Critics of the order say that it increases government costs because salary transparency increases the employee expense of federal contractors.

Federal agencies have adopted rules implementing many of Obama’s executive orders, including those listed above. As a result, the rulemaking process will have to be used to eliminate these restrictions, and that process won’t be completed on “day one.”

In The Art of the Deal, Trump wrote: “The best thing you can do is deal from strength, and leverage is the biggest strength you have. Leverage is having something the other guy wants. Or better yet, needs. Or best of all, simply can’t do without.”

Trump is not one to voluntarily give up his leverage in a business deal. If federal contractors want or need the removal of government restrictions like those outlined above, Trump will likely expect something in return. Contractors can expect Trump to negotiate for lower prices, faster turn-arounds, and better deliverables.

President Obama limited government outsourcing, but a Trump administration will likely increase outsourcing. In his contract with the American voter, Trump promised a hiring freeze on all federal employees except those in the military, public safety, or public health, with the goal of reducing the federal workforce through attrition. At the same time, Trump has promised increased spending on defense, immigration enforcement, infrastructure, prison privatization, energy, law enforcement, cybersecurity, and school choice. Companies in these industries will likely have many new opportunities to obtain government contracts. On the other hand, spending on environmental enforcement and education regulations will likely decrease, and companies in these industries may have fewer opportunities.

Federal contractors should also be on the look-out for new regulations on hiring former government contracting officers. In a recent television interview, Trump said that “the people that are making these deals for the government, they should never be allowed to go to work for these companies.”

If you need assistance regarding revised employer obligations, Bradley has the experience to help. Our Governmental Affairs Group, Labor & Employment Group, and Government Contracts Practice Group can help with how these changes affect how you treat your employees. This multidisciplinary approach provides our clients with the broad range of experience and expertise needed to address their specific goals.

Hear That Whistle Blowing? Tracking Awards Under the False Claims Act

Whistleblower in BusinessIf you do business with the federal government (think Medicare reimbursements, government contracts, student loans, etc.) and you have employees, you need to keep up with the recent False Claims Act (FCA) cases and the bounties whistleblowers are getting. There is no end in sight for the trend of increased whistleblower activity under the FCA. In 2016 alone, whistleblowers (many of whom are employees or former employees) received over $519 million as their shares of the FCA settlements and judgments and filed 702 new actions. As it does each year, Bradley has assembled an overview of the year’s major False Claims Act developments and opinions to keep you abreast of the status of law. You may find our 2016 Year in Review here.

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