Spotlight on Fair Pay for Female Law Firm Partners: Class Action Lawsuit Filed Against Sedgwick

By Kate S. Gold

Traci Ribeiro’s class action lawsuit against her employer Sedgwick LLP is the latest in a string of lawsuits in the pay equity battle, which has been highlighted in this year’s Presidential election and through the recent EEOC claim filed by the U.S. womens’ soccer team. Ribeiro is a non equity partner who claims that, as one of the firm’s three highest revenue generating partners, she has been denied equity partnership and was subjected to retaliation for filing an EEOC complaint claiming gender discrimination.  She seeks to represent a class of past and present female attorneys in partnership track positions at the firm; her complaint alleges violations of the California Fair Pay Act, Illinois Fair Pay Act, and Federal Equal Pay, as well as gender discrimination and retaliation under the California FEHA, Illinois Human Rights Act, and Title VII.  Ribeiro claims, in addition to routinely paying women lawyers less than their male counterparts, Sedgwick has denied women equity partnership and membership on its Executive Committee (until 2016, when Ribeiro made a formal complaint about gender discrimination).  She asserts discrimination under both a disparate treatment and disparate impact theory.

Among the more remarkable allegations in her complaint is that female associates were paid $40,000-$50,000 less annually than their male counterparts, and that despite her own high revenue generation, she was denied promotion to equity partnership three years in a row and, in 2015, an equity partner promotion was given to a male with less than 10% of Ribeiro’s revenues. But there is clearly a lot we can’t tell from reading the complaint:  as to the gender discrimination claims, what is the firm’s criteria and process for determining compensation and partnership and how is it biased in favor of men?  As to the fair pay claims, will the firm rely on the established defenses to pay disparities, such as a seniority system, a merit system, a system that measures earnings by quantity or quality of production, or upon a bona fide factor other than sex, such as education, training, or experience? Employers and employment lawyers will no doubt be following this case as the topic of pay equity continues to hold a firm place in the public spotlight.  That is, unless the case ends up in a private arbitration.  Ribeiro is also seeking declaratory relief that the dispute is not subject to the parties’ arbitration agreement (and is also attempting to stay Sedgwick’s arbitration demand which also seeks a declaration that the dispute should be compelled to arbitration).  For more information on compliance with Title VII, the Equal Pay Act and various state laws regarding gender discrimination and fair pay, contact Kate Gold or Lynne Anderson.

Defending and Preventing Employment Litigation – 2014 Edition

Drinker Biddle proudly announces the release of the 2014 edition of Defending and Preventing Employment Litigation. Written and updated for 2014 by Labor & Employment Group partners Gerald S. Hartman and Gregory W. Homer, Defending and Preventing Employment Litigation is a must have reference for employment lawyers, in-house employment counsel, general counsels, and human resources professionals.  The one-volume annually updated manual provides insight on preventing, preparing for, and managing employment litigation in discussing all types of discrimination, harassment, wage, leave and wrongful discharge claims.

The 2014 edition of Defending and Preventing Employment Litigation retails for $385.  Drinker Biddle has arranged a special discount rate of 20% off the retail price for friends of the firm. To purchase your copy of Defending and Preventing Employment Litigation click here.

President Obama Signs Two Executive Orders to Limit Workplace Discrimination

By: Mark E. Terman and Dennis M. Mulgrew, Jr.

On April 8, 2014, at an event commemorating National Equal Pay Day (an annual public awareness event that aims to draw attention to the gender wage gap), President Obama signed two executive orders designed to limit workplace discrimination.  The first prohibits federal contractors from retaliating against workers who discuss their salaries with one another, while the second instructs the Department of Labor to establish new regulations requiring federal contractors to submit summary data on compensation paid to their employees, including breaking down the data by gender and race.

The protections offered by the anti-retaliation Order overlap with many already existing under state and federal law.  For example, the NLRA protects employees’ right to engage in “concerted activities” and thus already prohibits employer discipline against employees who discuss their wages.  Further, some state laws, such as California Labor Code §232, already preclude an employer from disciplining an employee who discloses the amount of his or her wages.  Nonetheless, the Order may add to these protections, such as by expanding them to management employees (who are not protected by the NLRA), and providing an alternative option for bringing retaliation claims (i.e., through the Office of Federal Contract Compliance Programs rather than the NLRB).

The effects of the Order requiring the collection of compensation data will be unclear until the regulations themselves are formulated.  Based on the Order’s mandate to “avoid new record-keeping requirements and rely on existing reporting frameworks to collect the summary data” and to develop regulations that “minimize, to the extent possible, the burden on Federal contractors and subcontractors,” it is possible that the federal government will require that the data be submitted along with a federal contractors’ annual EEO-1 Report.

The President’s signing of these Orders appears to tie into the White House’s previously announced plans to accelerate change in areas it believes are within the authority of the Executive Branch, without the need for legislation.  Indeed, the Orders’ provisions mirror parts of the Paycheck Fairness Act (“PFA”), a proposed piece of legislation that would add procedural protections to the EPA and the FLSA to address male–female income disparity.  (The PFA came up for a vote in the U.S. Senate on April 9, 2014, where it was blocked by a Republican filibuster).  Similarly, in February 2014, President Obama issued an Order raising the minimum wage for federal contractors, at a time when Sen. Tom Harkin (D-Iowa) and Rep. George Miller (D-Calif.) were urging a bill to raise the federal minimum wage to $10.10 per hour and index it to inflation.  Then, in March 2014, President Obama directed the Labor Department to revamp regulations governing which types of employees business may classify as overtime-exempt “executives” or “professionals.”  With regard to the Order requiring the collection of compensation data, the OFCCP has been working internally on releasing a proposed compensation data collection tool for the past three years.  See http://www.dol.gov/ofccp/Presentation/Compensation_Data_Collection_Tool.htm (publicizing the OFCCP’s August 10, 2011 Advance Notice of Proposed Rulemaking regarding a new compensation data collection tool).

The high profile nature of the Orders provides yet another impetus for employers to evaluate their existing policies, and plan for the future.

Philadelphia Pregnancy Accommodation Law: Notice Requirement Begins on April 20, 2014

By: DeMaris E. Trapp

On January 20, 2014, Philadelphia Mayor Michael Nutter signed into effect an amendment to the city’s Fair Practices Ordinance: Protections Against Unlawful Discrimination that expressly includes pregnancy, childbirth, or a related medical condition among those categories protected from unlawful discrimination.

The city law covers employers who do business in Philadelphia through employees or who employ one or more employees.  Before this amendment, employers’ obligations under city, state, and federal antidiscrimination laws only required them to treat employees with pregnancy-related issues no worse than any other disabled employee with respect to accommodations.  Now employers are not only prohibited from denying or interfering with an individual’s employment opportunities on the basis of pregnancy, childbirth, or related medical conditions, but employers also are required to make reasonable accommodations on these bases to an employee who requests it.  The legislation’s non-exhaustive examples of reasonable accommodations include restroom breaks, periodic rest for those who stand for long periods of time, assistance with manual labor, leave for a period of disability arising from childbirth, reassignment to a vacant position, and job restructuring.  Employers have an affirmative defense under the law for failing to accommodate an employee if such accommodations would cause an undue hardship.

Employers should take note that this law increases the burden on them to provide reasonable accommodations, since examples like reassignment and job restructuring have traditionally not been required under similar federal and state laws that mandate accommodations for individuals with disabilities.  Thus, employers should review their policies and other written materials regarding employee accommodations to ensure that they reflect the increased protections afforded by the amendment.  Employers were required to provide written notice to its employees of the protections under this amendment by April 20th or post the notice conspicuously at its place of business in an area accessible to employees.  The Philadelphia Commission on Human Relations has provided a model notice to employees, which can be found at: http://www.phila.gov/HumanRelations/PDF/pregnancy_poster.pdf.

California Employers: What You Need to Know for 2014 – Immigrant Protections & Leaves, Accommodations, and Benefits

A new year means new legislation and regulations for employers with operations in California.  Prepared by Kate Gold, partner in the Los Angeles office, and Alexis Burgess, associate in the Los Angeles office, this four-part series will take a look at some of the new laws and regulation affecting private employers doing business in California.  Today we look at new laws and regulations in California dealing with immigrant protections & leaves, accommodations and benefits.

Immigrant Protections

Retaliation.  AB 263 prohibits an employer from using immigration law to retaliate against employees who assert protected rights under the Labor Code.  Employers who do so, e.g., by contacting or threatening to contact immigration authorities about the immigration status of a current, former, or prospective employee or their family members, will face various penalties, including suspension of certain business licenses, and may face civil action from affected employees.

Extortion.  Similarly, AB 524 clarifies that any person that threatens to report the known or suspected immigration status of an individual may be guilty of criminal extortion.

Despite both laws however, employers may still require employees to verify eligibility for employment under Form I-9 without becoming subject to any penalties.

Leaves, Accommodations, and Benefits

Leave for serious crime victims.  Under SB 288, an employee who has been a victim of certain serious crimes may not be discriminated or retaliated against for taking time off from work to appear in any legal proceeding in which his or her right as a victim is at issue.  The law defines “victim” to include any person who “suffers direct or threatened physical, psychological, or financial harm as a result of the commission or attempted commission of a crime or delinquent act,” as well as that person’s spouse, parent, child, sibling, or guardian.  Employees must, however, comply with specific requirements for requesting the leave.

Leave for stalking victims.  SB 400 extends existing leave protections for victims of domestic violence or sexual assault to victims of stalking.  All employers must provide time off to these victims to appear at legal proceedings, and employers with 25 or more employees must also provide time off to deal with medical/psychological treatment, including safety planning.

Leave for volunteer firefighters, peace officers, and rescue personnel.  Existing law requires an employer with 50 or more employees to permit an employee who is a volunteer firefighter to take temporary leaves of absence, not to exceed an aggregate of 14 days per calendar year, for the purpose of engaging in firefighting or law enforcement training.  AB 11 extends these leave provisions to reserve peace officers or emergency rescue personnel pursuing firefighting, law enforcement, or emergency rescue training.

Wage replacement.  Effective July 1, 2014, SB 770 extends paid family leave benefits to employees taking time off to care for a seriously ill grandparent, grandchild, sibling, or parent-in-law.  The law previously only covered time spent caring for a seriously ill child, spouse, domestic partner, or parent or to bond with a child within one year of birth, adoption, or foster care placement.  Note, however, that the law does not create the right to a leave of absence, but only to compensation/wage replacement during a qualifying absence.

“Family friendly” work arrangements in San Francisco.  According to the Family-Friendly Workplace Ordinance, employers with twenty or more full and part-time employees working within the geographic boundaries of San Francisco must consider employee requests for “flexible or predictable working arrangements to assist with care giving responsibilities,” provided that the employee has worked more than six months for the employer, works at least eight hours per week on a regular basis, and complies with guidelines set by the San Francisco Office of Labor Standards Enforcement in making the request.  The ordinance also requires applicable employers to post a notice on the premises informing employees of their rights, and protects employees from retaliation for making a request or from adverse action based on “caregiver” status.

Small business health insurance.  Small business owners with one to fifty eligible employees may now enroll for health care coverage online at the Small Business Health Options (“SHOP”) segment of the Covered California website.  In fact, beginning on January 1, purchasing insurance through SHOP will be the only way for small business owners to access federal tax credits helping to offset contributions toward employee premiums.  Small businesses will be eligible for such tax credits if they have fewer than twenty-five full-time-equivalent employees for the tax year, pay employees an average of less than $50,000 per year and contribute at least fifty percent of their employees’ premium cost.  Maximum tax credits will go to employers with ten or fewer full-time-equivalent employees with wages averaging $25,000 or less per year.

Make sure to check out the first two posts in this series on new Wage and Hour Laws and Penalties and Discrimination and Retaliation.

California Employers: What You Need to Know for 2014 – Discrimination and Retaliation

A new year means new legislation and regulations for employers with operations in California.  Prepared by Kate Gold, partner in the Los Angeles office, and Alexis Burgess, associate in the Los Angeles office, this-four part series will take a look at some of the new laws and regulation affecting private employers doing business in California.  Today we look at new laws and regulations in California dealing with discrimination and retaliation.

Discrimination and Retaliation

Retaliation.  AB 263 expands employer liability for violating Labor Code 98.6, which currently protects employees from discharge or discrimination when they have asserted their rights under the Labor Code.  As amended, the law will:

  1. Prohibit any retaliation or adverse action against employees who have asserted any right under the Labor Code or who have updated or attempted to update their “personal information” in a manner unrelated to their skill set, qualifications, or knowledge required for the job;
  2. Expand protected activity to include a written or oral complaint by an employee that they are owed unpaid wages; and
  3. Provide a civil penalty to employers of up to $10,000 per employee per instance of retaliation.

New protected class.  AB 556 adds “military or veteran status” to the list of classes protected from employment discrimination under the Fair Employment and Housing Act.

Sexual harassment.  SB 292 clarifies that sexually harassing conduct is unlawful under FEHA regardless of whether the conduct is motivated by any sexual desire.

Whistleblower protections.  Labor Code 1102.5 prohibits employers from retaliating against employees who report violations of a state or federal rule or regulation to a government agency, except for employees with duties related to company compliance.  SB 496 extends whistleblower protections to employees with compliance duties and expands protected activity to include:

  1. Reports alleging a violation of a local rule or regulation; and
  2. Internal complaints to “a person with authority over the employee or another employee who has the authority to investigate, discover, or correct the violation or non-compliance.”

The new law also clarifies that retaliation is prohibited when the employer “believes the employee disclosed or may disclose information.”

Make sure to check out the first post in this series on new Wage and Hour Laws and Penalties.