OSHA Safety Retaliation – What Is It?

Virtually every employee protection law, federal or state, has some sort of anti-retaliation provision. The federal Occupational Safety and Health Act is no exception. The Occupational Safety and Health Administration (OSHA) enforces the anti-retaliation provision in this federal law and also the anti-retaliation provisions contained in many other “whistleblower-type” federal laws. This post touches on the anti-retaliation cause of action in the Occupational Safety and Health Act, called a Section 11(c) claim, named after the section of the 1970 act in which it is found.

What’s Covered

My Safety Complaint Was Unsafe for My Continued EmploymentSection 11(c) applies to many forms of employee “protected activity.” Protected activity includes filing a complaint with OSHA, raising a safety complaint with the company, reporting a workers’ compensation injury, or participating in any way in an OSHA safety inspection. Notably, protected activity also includes refusing to follow a work order if an employee believes in good faith that following the order could cause death or serious injury. This type of refusal sometimes is referred to as “invoking safety rights” under the act.

What You Can’t Do

What constitutes retaliation according to OSHA? It is very broad. Any sort of negative employment decision close in time to employee-protected activity can be the basis for a Section 11(c) claim. Discipline and discharge are obvious examples. Prohibited employer conduct under 11(c) is much broader though. Any employer conduct that discourages safety or accident (or “near miss”) reporting is prohibited by 11(c). Thus, for example, OSHA has taken the position that employer safety programs that discourage the reporting of accidents or injuries can violate Section 11(c). An example would be a bonus policy that effectively rewards employees for not reporting workplace accidents without any sort of clear statement in the policy (or through training) that retaliation will not occur for accidents that are reported.

What Employees Can Get

Employers need to take potential Section 11(c) claims seriously. We have been seeing more and more of these claims recently, which is consistent with the trend of more retaliation claims generally. An employee must make a Section 11(c) claim very quickly, within 30 days of an alleged retaliatory act, and, once the claim is made, OSHA investigators should act very quickly, usually in just a matter of days. After OSHA completes its investigation, DOL lawyers will decide whether to bring a lawsuit against the company. These lawsuits are filed in federal court and proceed like many other federal discrimination lawsuits. While an individual employee cannot file the lawsuit by him or herself, these cases otherwise are similar to other discrimination cases. The complainant will have to show protected activity, an adverse action, and a causal connection between the two. If DOL is successful, remedies include back pay and back benefits, compensatory and punitive damages, reinstatement (or other remedial employment actions), notice posting and training, and an award of fees and costs. Settlement and mediation options exist as in other employment cases.

What’s Been Going on Recently

During the latter part of President Obama’s administration, OSHA issued administrative guidance related to Section 11(c). Specifically, OSHA took the position in 2016 that mandatory post-accident drug testing violated Section 11(c) unless an employer could show that drug use likely contributed to a specific accident. OSHA also attacked employer safety incentive programs that discouraged accident reporting, especially if some sort of employee benefit was withheld if accidents in fact were reported. Another aspect of the 2016 revision included a procedure by which an OSHA inspector could issue a retaliation citation even if an employee had never made a retaliation complaint to OSHA.

In the last few months under President Trump’s administration, OSHA has back tracked on some of the restrictions added by the last administration:

  • Post-incident drug testing is allowed if it is done consistently and if all persons who could have contributed to the incident are tested. In other words, testing is okay if it is not just limited to the employee who reported an injury.
  • Safety programs are allowed in many forms, including those that provide “accident-free” bonuses. Such programs should include policy statements, training, and related precautions that make clear that accidents and injuries still should be reported and that employees will not be retaliated against for doing so.

In conclusion, keep safety activities in mind when disciplining employees or implementing safety-related rules and policies. Employer intent matters. If an employment decision follows closely on the heels of protected activity or cannot be justified by legitimate non-retaliatory motivation of the decision maker, a Section 11(c) claim could be very unsafe for the company.

Securing the Bag – Sixth Circuit Affirms Award of Attorneys’ Fees to Staffing CompanyIn today’s competitive job market, it is customary for employers to include restrictive covenants, e.g., non-competition and non-solicitation provisions, in employment agreements. While these covenants are essential to protect employers from unfair competition, an attorney’s fees provision is just as critical to save employers tens of thousands of dollars in litigation expenses. In Kelly Services, Inc. v. De Steno, the Sixth Circuit not only illustrates the importance of strategically drafted damages provisions in employment agreements, but also defines the role of a jury in determining the amount of certain fees to be awarded to a party.

Background

Kelly Services, a staffing and consulting company, hired Dale De Steno, Jonathan Persico, and Nathan Peters. Before joining Kelly Services, all of the men were required to sign employment agreements that included non-compete provisions. The agreements also included damages provisions that stated that if the employee breached the agreement, he would pay reasonable attorneys’ fees, court costs, and any other related fees and/or costs incurred by Kelly Services in enforcing the agreement.

In early 2016, De Steno, Persico, and Peters left Kelly Services to work for a competitor in similar staffing positions in the same market area. Kelly Services sued the men for breach of the non-competition provisions and breach of the duty of loyalty and moved for a preliminary injunction. The district court found: (1) Kelly Services made an initial demonstration that irreparable harm may occur without an injunction; (2) harm to Kelly Services from not issuing an injunction outweighed the harm to the former employees; (3) Kelly Services demonstrated that it would likely prevail on the merits; and (4) public interest was more favorable to Kelly Services. Consequently, the district court enjoined De Steno, Persico, and Peters from violating their non-compete agreements and determined that the preliminary injunction would last for 60 days. De Steno, Persico, and Peters filed an interlocutory appeal challenging the preliminary injunction.

On July 25, 2016, three days before the preliminary injunction was set to expire, Kelly Services requested a 60-day extension.  The district court granted an extension until the Sixth Circuit ruled on the interlocutory appeal. However, within a few weeks, De Steno, Persico, and Peters voluntarily dismissed their interlocutory appeal and litigation continued. In the spring of 2017, the district court retroactively lifted the preliminary injunction and the parties engaged in mediation. After mediation was unsuccessful, the parties moved for summary judgment. The district court acknowledged that Kelly Services had received all of the injunctive relief that it sought in its complaint and agreed with Kelly Services that the only remaining issue was the amount of attorneys’ fees and costs owed to Kelly Services. Ultimately, the district court ruled Kelly Services was contractually entitled to reasonable attorneys’ fees under a plain reading of the employment agreements and a jury was not required to decide the amount of damages. De Steno, Persico, and Peters appealed.

Sixth Circuit Affirms District Court’s Award of Attorneys’ Fees

On appeal, De Steno, Persico, and Peters initially argued that the non-compete provisions were unenforceable under Michigan law and the district court never finally ruled on that issue. Like the district court, the Sixth Circuit rejected that argument, concluding that even though the district court did not reach the enforceability issue, the former employees still owed Kelly Services attorneys’ fees based on the terms of the agreements themselves. Specifically, De Steno’s agreement provided that he would “pay Kelly’s reasonable attorney’s fees and costs involved in enforcing [the] Agreement.” Similarly, Persico’s and Peters’ agreements provided that they would “pay any and all legal fees, including . . . all attorneys’ fees . . . incurred by [Kelly Services] in enforcing [the] Agreement.” The Sixth Circuit ruled that Kelly Services’ attorneys’ fees were “involved” or “incurred” “in enforcing” the employment agreements, so Kelly Services was entitled to these fees under a plain reading of the contracts. The court emphasized that the terms of the agreements did not require a final determination of liability in favor of Kelly as a condition for the award of fees.

“Unlike numerous similar agreements, these contracts [did] not employ the words “prevailing party,” nor by their literal language [did] they require a final determination of liability.”

Although the Sixth Circuit recognized that there could be problematic cases in which efforts to “seek enforcement” were unreasonable, made with little or no basis, made for the purpose of oppression or harassment, or simply unsuccessful, none of these scenarios were at issue in the present case.

In addressing the former employees’ argument that a jury must determine the amount of attorneys’ fees under the Seventh Amendment, the Sixth Circuit again sided with the district court. The court explained that the Seventh Amendment grants parties a right to a jury only for a determination of legal issues, not equitable ones, and no legal issues existed in this case. The court also stressed that it would have been “highly impractical” for a jury to determine the amount of attorneys’ fees in the instant case because the parties would have to submit evidence on attorneys’ fees before the end of the trial and resultant necessary legal services. With no provision in the employment agreements specifying the amount of attorneys’ fees to be awarded, and in the interest of fairness and efficiency, the district court rightfully determined a reasonable amount of attorneys’ fees. The Seventh Amendment did not require otherwise.

Securing the Bag

So how can employers increase their likelihood of “securing the bag” from rogue employees who violate restrictive covenants and expect to escape liability? Here are a few ideas:

  1. In addition to drafting enforceable restrictive covenants, draft damages provisions so that you are compensated for enforcing the agreement, not merely prevailing in litigation. Unless contrary to public policy, courts will generally enforce an attorneys’ fees’ provision just as any other term in a contract. Protect yourself first.
  2. Do your homework, and be sure you have a factual basis to show that your former employee violated a restrictive covenant. The rumor mill may be enough to begin investigating an employee, but it may not be enough to get a preliminary injunction. Research the former employee’s LinkedIn profile for employment updates. Review the subsequent employer’s website for any press releases about new hires or lists of employees in certain departments or industries. The internet and social media are great resources to verify suspicions of breach of an employment contract.
  3. Confront the former employee before engaging in litigation. Send a cease and desist letter to the employee and his or her subsequent employer detailing the terms of the restrictive covenant and the factual basis for your belief that the covenant has been violated. Hopefully, this is sufficient to compel the employee to adhere to the terms that he or she originally agreed to. If not, you can place the potential defendant on notice that you will seek legal action to remedy the breach. Because of your well-crafted employment agreement and due diligence, the law is likely to be on your side.

ICE Capades: Worksite Immigration Enforcement SurgesWorksite enforcement actions related to unauthorized workers are on the rise. Fulfilling a promise from 2017, Homeland Security Investigations (HSI), the investigatory arm of U.S. Immigration and Customs Enforcement (ICE), has significantly ramped up its efforts to clamp down on the employment of unauthorized workers. ICE’s recently released statistics for Fiscal Year (FY) 2018 show a dramatic surge in the number of worksite enforcement actions carried out by HSI. According to HSI Associate Director Derek N. Benner, this trend is intended to:

“protect jobs for U.S. citizens and others who are lawfully employed, reduce the incentive of illegal migration, eliminate unfair competitive advantages for companies that hire an illegal workforce, and ultimately help strengthen public safety and national security.”

According to ICE, in FY 2018, HSI quadrupled its worksite investigations (6,848 in FY 2018 versus 1,691 in FY 2017) and its Form I-9 audits (5,981 in FY 2018 as compared to 1,360 in FY 2017). In addition, HSI made 779 criminal and 1,525 administrative worksite-related arrests in FY 2018, compared to 139 and 172, respectively, the previous year. This reflects an increase of between 300 and 750 percent in these statistical categories.

Employers should not expect this trend to change any time soon. The Trump administration views reducing illegal employment as a critical part of its broader hardline immigration policy and is clearly committed to vigorous enforcement. The time for employers to make sure their immigration compliance practices are in order is now.

So, What Can You Do?

There are a number of measures that an employer can take to reduce its potential exposure in the event it finds itself in ICE’s crosshairs:

  • Make sure your Form I-9s are completed timely and correctly. Check your current protocols to ensure that these forms are being processed properly when new employees are hired. If ICE initiates an investigation at your place of business, having good Form I-9s will go a long way in reducing potential exposure.
  • Provide comprehensive training to the company representatives who are responsible for completing your Form I-9s. Completing these forms correctly is not rocket science, but knowing how to do it properly takes training.
  • As we have said before, conduct an internal audit of your existing Form I-9s or have an independent third party do it for you. If your Form I-9s are missing or contain errors, there are steps you can take to improve your lot. Do this sooner rather than later. Once ICE shows up, you’re probably out of time.
  • Be prepared in the event of a Form I-9 audit or other ICE investigation. It’s critical to know in advance who at the company is responsible for dealing with ICE officials. No employer is exempt from the possibility of a visit from ICE. Having a well-devised contingency plan is key.
  • Attend our firm’s Breakfast with Bradley Seminar on March 14. We will be hosting this event in six of our offices—Birmingham, Charlotte, Huntsville, Jackson, Montgomery and Nashville. One of the topics, which I’ll cover, is “Immigration Compliance for Employers in Today’s Enforcement Environment.” I’ll discuss ICE’s new enforcement priorities and provide tips on how employers can stay compliant with their immigration-related obligations. Look for the invitation – we hope to see you there.