NLRB Rules That Policy Requiring Employees to Individually Arbitrate Employment Disputes Violates the National Labor Relations Act

On June 3, 2013 an National Labor Relations Board (NLRB) Administrative Law Judge (ALJ) reached a decision in which it found that MasTec Services’ Company’s policy that required employees to individually arbitrate employment disputes violated Section 8(a)(1) of the National Labor Relations Act (NLRA).  In so holding, the ALJ radically expanded the NLRB’s previous decision in D. R. Horton, Inc. (1/3/12).  As D.R. Horton itself has been rejected by almost all federal courts which have considered it, the MasTec decision is bound to create a firestorm of criticism.

In D.R. Horton, the NLRB ruled that requiring employees to sign a blanket waiver of rights to pursue their employment claims through class actions violated Section 8(a)(1) of the NLRA.  The specific agreement at issue in D.R. Horton (1) contained a mandatory arbitration provision, and (2) required employees to bring all employment-related claims to an arbitrator on an individual basis, as opposed to as a potential class action.  The D.R. Horton decision generated significant criticism, and many commentators noted that it appeared to conflict with U.S. Supreme Court precedent, specifically AT&T Mobility LLC v. Concepcion, 131 S. Ct. 1740 (2011)Concepcion held that the Federal Arbitration Act preempts state laws that prohibit contracts from disallowing class-wide arbitration, and that companies can enforce contract provisions that require customers to arbitrate their disputes individually.  Concepcion, which involved a consumer contract, was thought to make it much harder for individuals – not only consumers, but also employees who had signed arbitration agreements – to file class action lawsuits.

Although D.R. Horton initially caused great concern among employers, as it seemed to eliminate the possibility of preventing class suits through mandatory arbitration agreements, this concern has been tempered by the fact that an overwhelming number of federal courts that have considered the issue have refused to follow the decision, including the Eighth Circuit Court of Appeals.  See e.g., Owen v. Bristol Care, Inc., 702 F.3d 1050 (8th Cir. 2013); Delock v. Securitas Security Servs. USA, Inc., 883 F. Supp. 2d 784 (E.D. Ark. 2012); Morvant v P F Chang’s China Bistro Inc., 2012 WL 1604851 (N.D. Cal. 2012); De Oliveira v. Citicorp North America, Inc. (M.D. Fla. 2012); Tenet Healthsystem Philadelphia, Inc. v. Rooney (E.D. Pa. 2012); Lavoice v. UBS Wealth Management Americas (S.D.N.Y. 2011); Johnmohammadi v. Bloomingdales, Inc. (C.D. Cal. 2012); Sanders v. Swift Transp. Co. of Ariz., 843 F Supp. 2d 1033, (N.D. Cal. 2012); Palmer v. Convergys Corp., 2012 WL 425256 (M.D. Ga. 2012).

MasTec is sure to be controversial because, despite the courts’ hostile reaction to D.R. Horton, MasTec expands its holding.  The arbitration provision at issue in MasTech was less restrictive than that in D.R. Horton, in that it (1) permitted the employee to opt out within 30 days, and (2) explicitly authorized employees to bring claims to administrative agencies.  Nonetheless, even with these safeguards in place, the ALJ found the provision to violate Section 8(a)(1).  The ALJ gave three independent reasons for reaching this conclusion.  First, given that the NLRA grants employees the right to engage in protected concerted activities without interference, an employer may not require its employees to affirmatively act (through the opt-out) in order to obtain or maintain those rights.  Second, employees who opt out still would be unable to engage in and cooperate in concerted activities with those who did not opt out, disadvantaging them in their attempts at concerted action.  Third, some employees may be reluctant to exercise the opt-out option for fear of angering their employers.  Under the reasoning of the Mas Tec opinion, it would be virtually impossible for any employer to include a class action waiver in arbitration agreements with individual employees.

D.R. Horton itself is currently on appeal before the U.S. Court of Appeals for the Fifth Circuit.  Should the NLRB and Federal Court decisions continue to diverge, the stage may be set for a reversal of D.R. Horton (or perhaps a Supreme Court decision).  We will continue to monitor D.R. Horton and its progeny, given the case’s broad implications for employers potentially subject to employee class actions.

The Dos and Don’ts of Implementing a Mandatory Flu Vaccine Policy Outside the Hospital Setting

By: Meredith R. Murphy

As health experts describe this flu season as one reaching epidemic proportions, many employers are questioning the legality of requiring their employees to receive a flu vaccine shot when they recognize business and safety needs for ensuring their work environments and workforce are better protected from the flu virus.  This need is especially acute for non-hospital employers who care for individuals with compromised immune systems, such as rehabilitation centers or schools.  While a different set of considerations come into play when a hospital is assessing how to implement a flu vaccine policy (see our post from January 24, 2013 – “Firing Employees Who Don’t Get Flu Shots:  What Risks Do Hospitals Face”, Mark Nelson), non-hospital employers have business needs and health concerns that may make implementation of a flu vaccine policy desirable or necessary.

So, what should an employer consider before implementing such a policy?

  • DO evaluate the business need for the policy.  Whether it be concern for patients, clients, or customers or, rather, a need to ensure that your workforce is less likely to be on leave due to a flu outbreak, an employer must be prepared to identify its reasonable business interest if the policy is challenged.
  • DO consider what type of policy suits business needs.  Some employers are implementing mandatory policies for all employees to receive a flu shot.  Others are only requiring that certain categories of employees receive a flu shot, i.e., those with regular access to patients or individuals with compromised immune systems.  Still others are implementing a policy that “strongly encourages” flu vaccinations.
  • DO review any applicable Collective Bargaining Agreements.  Under the National Labor Relations Act, a flu vaccination policy is a mandatory subject of bargaining.  This means that a unionized employer cannot unilaterally implement such a policy without giving the union notice of the policy and bargain over the policy if the union requests.  However, as set forth under recent National Labor Relations Board caselaw, a union may waive a right to bargain over such a policy by way of a Management Rights Clause.  See Virginia Mason Medical Center, 358 NLRB No. 46 (2012).  If unionized, employers should evaluate the breadth of their clause to see if the union has waived the right to bargain regarding the employer’s right to direct employees, to determine materials and equipment to be used and/or to implement improved operational methods and procedures.  In the Virginia Mason case, the NLRB specifically recognized this type of waiver language as permitting the Medical Center to require non-immunized nurses to wear facemasks.
  • DON’T refuse to engage in an interactive process with any objecting employees.  Employers should be prepared to work with an employee’s health or religious objections to receiving a flu shot.  The Equal Employment Opportunity Commission has taken the position that employees may be exempt from a mandatory vaccination requirement based on an ADA disability or a “sincerely held religious belief, practice, or observance.”  See www.eeoc.gov/facts/pandemic_flu.html -48k-2009-10-21.  Courts have recognized that such sincerely held” beliefs may include lifestyle choices such as veganism.  See Chenzira v. Cincinnati Children’s Medical Center, No. 11-917 (S.D. Ohio, December 27, 2012).  In such instances where an employee expresses a health or religious-based objection to a mandatory flu vaccine policy, the employer should discuss reasonable accommodations with the employee, e.g., exempting the employee from the policy entirely, transferring the employee to another position temporarily (until the flu threat ends as determined by local health officials) or permitting the employee to wear a facemask when in proximity to patients and coworkers.
  • DON’T terminate any employee who refuses a flu shot without engaging in the interactive process if they are objecting for health or religious reasons.  Further, any disciplinary measures should be uniformly implemented in the case of employees in violation of the policy.  Employers may also want to consider progressive discipline for first-time offenders, e.g., issuing a warning letter for an initial failure to show proof of a flu shot or failure to wear a facemask.
  • DO ensure that any policy implemented is enforced uniformly.  Require proof that employees have received a flu shot.  In the case of objectors, seek a waiver that the employee is unable or objects to vaccination and then engage in the interactive process to agree upon a reasonable accommodation.
  • DO consider making flu shots available to employees on-site to maximize compliance with any flu shot policy.
  • DON’T implement a policy without contacting your state’s Department of Health or any other related agencies.  These agencies can provide guidance on the manner in which vaccine policies should be implemented for various categories of employers or regarding possible accommodations for objecting employees.

 

Firing Employees Who Don’t Get Flu Shots: What Risks Do Hospitals Face?

By: Mark D. Nelson

As hospitals continue to see an onslaught of flu patients, they also face challenges to flu vaccination policies designed to reduce the spread of flu to patients and fellow employees.  Hospitals are understandably concerned with protecting patients, visitors and employees from contracting the flu and the potentially serious consequences to the health of elderly and infant patients. However, protecting patients against flu can create legal liability when employees are disciplined, discharged or suffer other adverse action because they do not get a flu shot.

Employment Considerations for Flu Vaccination Policies—The National Labor Relations Act

What limitations exist on a hospital’s ability to create and implement a flu/other vaccination policy?  Under the National Labor Relations Act, a flu vaccination policy is a mandatory subject of bargaining.  This means that unionized hospitals cannot unilaterally implement such a policy without first giving the union notice of the intended policy and bargain over the policy if the union requests to do so.

A hospital does not have to bargain if the union has “clearly and unmistakably” waived its right to bargain over the issue.  A waiver is typically found in the “Management Rights” clause, which was the case in a recent National Labor Relations Board (NLRB; the Board) decision, Virginia Mason Medical Center, 358 NLRB No. 64 (2012), where the Board found a clear and unmistakable waiver in the Management Rights clause.  That clause stated, in relevant part, that the Medical Center has the right to “operate and manage the Hospital, including but not limited to the right to require standards of performance and…to direct the nurses…to determine the materials and equipment to be used; to implement improved operational methods and procedures…to discipline, demote or discharge nurses for just cause…and to promulgate rules, regulations and personnel policies….”

The Union representing the Medical Center’s registered nurses filed an unfair labor practice charge with the Board and a hearing was held before an NLRB Administrative Law Judge (ALJ).  The ALJ ruled, and the Board agreed, that the Management Rights clause did not specifically mention wearing facemasks (which the flu policy required in certain areas for non-immunized nurses), but it did “specifically allow the Hospital to unilaterally ‘direct the nurses’ and ‘determine the materials and equipment to be used’ [as well as] implement improved operational methods and procedure.’”  The ALJ noted that the Hospital had several infection control policies that required nurses to wear masks under various circumstances, and found that requiring non-immunized nurses to wear masks was within the Hospital’s authority to “determine the materials and equipment to be used [and] implement improved operational methods and procedures.”

With properly crafted language in a Management Rights clause or elsewhere in a collective bargaining agreement, a unionized hospital has the right to unilaterally implement a new flu vaccination policy or modify an existing policy.

Employment Considerations for Flu Vaccination Policies—Disability and Religious Discrimination

Hospitals, of course, have reached different decisions on how to balance the interests of patients and employees. As such, policies vary in the flexibility given to employees regarding non-vaccination and the resulting consequences:

  • Vaccination encouraged but not mandated
  • Vaccination mandated with exemptions for medical contraindication, religious beliefs (discipline/other adverse consequences for non-exempted employees)
  • Vaccination mandated and masking required for medical contraindication, religious beliefs (discipline/other adverse consequences for failure to be vaccinated or wear mask, as applicable)
  • Vaccination required (discipline/other adverse consequences for non-compliance)

Flu vaccination policies also differ regarding applicability.  Some policies apply only to employees who come into direct contact with patients.  At the other end of the continuum, the policy applies to all employees, independent contractors, students, interns, vendors and others who provide services inside the hospital.

Union and non-union hospitals should consider the potential for discrimination claims based on a flu vaccination policy that requires any group of employees to get a flu shot or face adverse consequences (such as discharge) if they fail to do so for any reason.  The Equal Employment Opportunity Commission (EEOC) would likely find such a policy to be unlawful.  The EEOC has taken the position in its “Pandemic Preparedness in the Workplace and the Americans with Disabilities Act” guidance that

“[a]n employee may be entitled to an exemption from a mandatory vaccination requirement based on an ADA disability that prevents him from taking the influenza vaccine. This would be a reasonable accommodation barring undue hardship (significant difficulty or expense). Similarly, under Title VII of the Civil Rights Act of 1964, once an employer receives notice that an employee’s sincerely held religious belief, practice, or observance prevents him from taking the influenza vaccine, the employer must provide a reasonable accommodation unless it would pose an undue hardship as defined by Title VII (“more than de minimis cost” to the operation of the employer’s business, which is a lower standard than under the ADA).”

www.eeoc.gov/facts/pandemic_flu.html – 48k – 2009-10-21

Recently, a federal district court in Ohio refused to dismiss a complaint by a registered nurse alleging religious discrimination because she was fired for refusing to comply with the hospital’s mandatory flu vaccination policy.  Chenzira v. Cincinnati Children’s Medical Center, S.D. Ohio, No. 1:11-cv-00917 (12/27/12).   The employee’s refusal was based on her “religious beliefs” in veganism. The court rejected the hospital’s argument that her veganism was merely a “social philosophy or dietary preference.”  According to the court, it was plausible the employee could show that she held her belief in veganism with the same sincerity as traditional religious beliefs.  However, this case is far from over.  The court noted that its ruling on the motion to dismiss “in no way addresses what it anticipates as the hospital’s justification for its termination of the employee — the safety of patients at Children’s Hospital.”

Not all refusals to get a flu shot are based on medical or religious reasons.  A hospital in northern Indiana fired seven employees who refused to get flu shots.  One oncology nurse who was fired said it was “a personal thing.”  The nurse said she gets other vaccinations but it should be her choice whether she gets the flu vaccine.  She said she opposes “the injustice of being forced to put something in [her] body.”  Absent a violation of applicable state law, it is doubtful this employee would have a claim against the hospital for her termination.

Considerations in Creating a Flu Vaccination Policy

Current CDC guidelines do not require hospitals to mandate flu vaccination in any form; the CDC recommends active encouragement of employees to get a flu shot.  However, some hospitals believe it is appropriate to do more to try to protect vulnerable patients from catching the flu in the hospital and then suffering severe health consequences.  These hospitals mandate that at least some groups of employees must be vaccinated.  ”

Terminating or taking other adverse action against an employee who cannot get the vaccine because of a disability (as defined in the Americans with Disabilities Act and/or applicable state law) exposes a hospital to meaningful risk of a discrimination lawsuit.  The same is true for employees who raise a “religious objection.”

Hospitals should evaluate such refusals on a case-by-case basis and explore possible reasonable accommodations of the employees’ refusal to get vaccinated, and the policy should so inform employees. Possible reasonable accommodations could be exempting the employee from the policy entirely, transferring the employee to another position temporarily (until the flu threat ends as determined by local health officials) or permitting the employee to wear a mask when in proximity to patients and coworkers.  From my perspective as a former hospital board chairman, this approach presents a balancing of the hospital’s interest in protecting patients from flu exposure while protecting the legal rights of certain employees who decline to get vaccinated.  In the final analysis, many hospitals believe that risk of harm to patients may trump an individual’s right to refuse when flu epidemics are declared.