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

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.

Employer Liability Under State Medical Marijuana Laws

By: Cheryl D. Orr and Francesco Nardulli

Across the country, employers in states allowing medical marijuana use have been grappling with whether these statutes impact employer policies concerning drug testing and maintaining a drug-free workplace.  Though the statutes allow for marijuana use for medical purposes (and some for recreational purposes), these statutes do not consistently address the impact of legal medical marijuana on employers, if at all.  And the number of states enacting such legislation is continuing to grow.

Since 1996, 20 states[1] and the District of Columbia have enacted some form of legislation that allows for the non-criminal use of marijuana for medical purposes.  In fact, in the last three years, eight states have passed medical marijuana laws – and Illinois became the 21st jurisdiction to legalize medical marijuana when Governor Quinn signed HB 1 into law on August 1.

As such, companies that employ individuals in states with medical marijuana may be uncertain as to whether or under what circumstances they can take action with respect to an employee that fails a drug test or otherwise admits to being a medical marijuana patient.

Civil Protections – Where Do We Stand Today?  

Most of the states that have enacted a medical marijuana law have statutory language that is silent about medical marijuana patients’ civil protections.  Of the 21 jurisdictions that have medical marijuana on the books, 15 do not provide for any form of employment protections.[2]  In fact, supreme courts in California, Oregon, Washington and Montana have all upheld employer decisions to discharge employees that were medical marijuana patients.  The plaintiffs in these lawsuits have argued that medical marijuana users are protected under such statutes because the law itself creates the sought-after employment protections, that the employer’s decision to discharge the user violates the public policy of the state, and/or that the employer discriminated against them on the basis of a disability when it failed to accommodate their medical marijuana use.  The courts, in response, have held that the medical marijuana statutes in their state only protect patients from criminal sanctions and do not create any civil remedies or protections.  As such, the courts have held that these statutes do not create a clear public policy that might otherwise support a wrongful termination claim or establish that medical marijuana users belong to a protected class.  With respect to claims based on asserted disabilities, courts, like the Supreme Court of Oregon, have held that federal law preempts any argument that an individual is protected from disability discrimination on the basis that they are a medical marijuana patient.

Another argument that was recently tested by a plaintiff in Colorado is that an employer’s decision to discharge a medical marijuana user who fails a drug test violated the state’s “lawful activities” statute.  Colorado, like many states, prohibits employers from taking action against an employee for engaging in lawful activities or using lawful products outside of the workplace.  In a decision dated April 25, 2013, the Court of Appeals of Colorado held that the state’s “lawful activities” statute did not bar the employer from discharging an employee who tested positive for marijuana after a random drug test and who was also a licensed patient.  Coats v. Dish Network, LLC, case nos. 12CA0595, 12CA1704 (Co. Ct. App. April 25, 2013).  The court held that since the Colorado statute did not specify whether an activity’s “lawfulness” was determined by state or federal law, and marijuana is illegal under federal law, employees that use medical marijuana are not shielded by the statute from the risk of termination.

Despite the lack of civil protections in a majority of jurisdictions that have legal medical marijuana, a few states do provide clear restrictions on an employer’s ability to discriminate against a medical marijuana patient.  In Connecticut, Maine and Rhode Island, medical marijuana patients are given protected status and employers are prohibited from discriminating against an employee merely due to their status as a medical marijuana patient.  Under Illinois’ HB 1, Illinois also now prohibits such discrimination.

In addition, Arizona and Delaware have adopted much more explicit and impactful statutorily language that bars an employer from discriminating against a registered and qualifying patient who has failed a drug test for marijuana metabolites or components.  The only exceptions to this rule are that an employer may act upon the results of a failed drug test if the patient “used, possessed or was impaired by marijuana on the premises of the place of employment or during the hours of employment” or failing to do so would jeopardize an employer’s “monetary or licensing related benefit under federal law or regulations.”  See ARS 36-2813 and Del. Code Title 16, § 4905A.  Neither statute has been tested in the courts, but the language of these statutes appears to plainly prohibit employers from firing an employee who is a qualified medical marijuana patient based solely on a failed drug test.  Rather, in these two states, most employers will need to prove that their decision was based on the fact that the employee used, possessed or was impaired by marijuana while on the job.

Uncertainties Around Illinois Statute

Whether Illinois’ medical marijuana statute provides similar protections is a more uncertain question.  With regard to employer liability under the proposed statute, HB 1’s provisions are generally couched in what they do not prohibit, leaving open to interpretation what it may bar with regard to workplace decision-making.  HB 1 first states that it does not prohibit “an employer from enforcing a policy concerning drug testing, zero-tolerance or a drug free workplace provided the policy is applied in a nondiscriminatory manner.”  The bill also states that employers are not limited from “disciplining a registered qualifying patient for violating a workplace drug policy.”  These initial provisions suggest that Illinois’ statute is in line with the majority of jurisdictions, but then it goes on to provide that “[n]othing in this Act shall limit an employer’s ability to discipline an employee for failing a drug test if failing to do so would put the employer in violation of federal law or cause it to lose a federal contract or funding.”  This language, like that in Arizona and Delaware, appears to potentially prohibit employers from relying upon a failed drug test for marijuana unless the employer has contrary obligations under federal law or regulation.  The statute continues down this road by also stating that it does not create a cause of action against an employer for actions based on a good faith belief that the medical marijuana user used, possessed or was impaired by marijuana while working.  It also provides that an employer may consider a patient to be impaired when they exhibit “articulable symptoms … that decrease or lessen [the employee’s] performance of the duties or tasks of the employee’s job position.”  This provision further states that if an employee is disciplined under this section, that they must be given an opportunity to contest the employer’s determination.

Taking these latter provisions into account, there are strong arguments in favor of the position that Illinois’ medical marijuana does provide similar civil employment protections as found in Arizona’s and Delaware’s statutes.  First, the bill states that employees cannot sue an employer for actions that were based on a good-faith belief that the employee was impaired, that the belief that an employee is impaired must be based on “articulable symptoms,” and that  employees must have an opportunity to rebut the idea the they were impaired.  These provisions suggest that an employer may be found to have acted in bad faith and subject to liability if it discharges an employee without an articulable basis for why it believed that the employee was impaired or fails to give an employee a chance to challenge an assertion that they were impaired on the job.  In addition, the statute appears to tie the ability of an employer to discipline an employee for failing a drug test to an employer’s obligations under federal law.  This framework creates a plausible argument that the statute does provide protections for medical marijuana users who do not use or are not impaired by marijuana on the job.  However, the pronouncement that employers are not limited in keeping drug testing, zero tolerance, or drug-free workplace policies seems to conflict with such a finding.  Perhaps one way to read these provisions consistently is to find that the statute allows employers to maintain such policies, but that they must treat medical marijuana patients in the same manner as other employees that have been prescribed legal medications.  In reality, the only way we will know the answer to this question is when the law is inevitably relied upon by a qualified patient who is fired for failing a drug test that is positive for marijuana.

Recommendations for Employers in Medical Marijuana Jurisdictions

So, how should employers respond to these increasingly more common medical marijuana laws?  For those employers who have federal contracts or are otherwise subject to federal regulations concerning drug-free workplaces, your practices do not need to change.  According to the Department of Transportation, which regulates and provides drug testing requirements for certain safety-sensitive positions, it is “unacceptable for any safety-sensitive employee subject to drug testing under the Department of Transportation’s regulations to use marijuana.”  Thus, employers subject to such or similar regulations should continue to comply with applicable federal law.

Employers that are not subject to federal drug testing regulations should review their substance abuse policies to ensure compliance with local and state law.  Employers in states that generally do not provide for employment protections should still consider whether their state has a “lawful activities” or “lawful products” statute or whether courts in their state may be more favorable to finding a clear public policy protecting medical marijuana users.  In light of the holdings of those decisions that have addressed the issue, courts in these states will likely find that their state law does not establish a clear public policy in favor of medical marijuana patients.  However, this analysis may differ in Colorado and Washington, both of which now allow for legal recreational use.  In those states that do provide for some form of employment protection, you should carefully revise your policies to be consistent with those laws.

Employers should also consider whether or when they will conduct drug testing.  With the passage of these laws, employers should expect that more of their employees may be using marijuana outside of the workplace.  Similarly, employers should expect more challenges, based on the long period of time that marijuana metabolites remain in an individual’s system, from employees that have failed drug tests but who claim they were not impaired while working.  In Arizona, Delaware and Illinois, employers should revise their substance abuse policies to make sure they conform to state law and ensure that employees who are qualified patients are not disciplined solely on the basis of a failed drug test.  Lastly, employers should train their supervisors and managers to recognize signs of impairment (whether due to marijuana, alcohol, or other substances) and how to deal with inquiries from employees regarding their use of medical marijuana.


[1] States that provide for some form of legalized medical marijuana states are: Alaska, Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Massachusetts, Michigan, Montana, Nevada, New Hampshire, New Jersey, New Mexico, Oregon, Rhode Island, Vermont, and Washington.

[2] The six jurisdictions that do provide some level of civil protections are: Arizona, Connecticut, Delaware, Illinois, Maine, and Rhode Island.