Who, What, Why . . .

Business People Diversity Team Corporate Communication ConceptWho does it apply to: Part of the protection comes from Title VII, which applies to employers with 15 or more employees. An overlapping part of the protection comes from the Immigration Reform and Control Act (IRCA), which applies to employers with four or more employees.

What is the issue: Title VII was passed in the 1960s to protect against discrimination based on race, color, religion, sex or national origin. The IRCA was passed to resolve a number of immigration-related issues but includes a provision that protects against employers discriminating in hiring or discharging an employee based on citizenship or immigration status (not including unauthorized aliens).

What am I required to do: Employers are required not to discriminate against employees on the basis of national origin. More specifically, employers are required not to treat an employee adversely with any consideration of his or her national origin, citizenship or immigration status in relationship to any significant aspect of employment.

What constitutes a violation: There are two kinds of violations: direct mistreatment and disparate impact. Direct mistreatment is straightforward. If an employer affirmatively mistreats an employee because of national origin, citizenship or immigration status by failing to hire or firing the employee, it can be actionable discrimination. Similarly, employers who demote or otherwise significantly slight an employee based on national origin may be liable for disparate treatment.

Disparate impact is more subtle. If an employer creates a policy that is neutral or non-discriminatory on its face, that policy might have a consequence of negatively impacting workers of one national origin more significantly than others. If an employer institutes a policy that employees must have clear English diction, the policy itself does not seem discriminatory because it may affect any worker. That said, certain national origins might be adversely affected because of their accent. This facially neutral rule has a disparate impact against workers of certain national origins and may create a claim.

What counts as a national origin, citizenship, or immigration status: The law goes way beyond what most employers would think:

  • National origin includes birthplace, ancestry, culture, linguistic characteristics and accent.
  • Citizenship includes U.S. citizenship and citizenship of another nation for individuals legally in the country under U.S. law.
  • Immigration status includes any type of U.S. government-authorized visa or other work authorization that declares the intention to become a U.S. citizen.

What if my employee violates without consent: Choose carefully who you place in charge. Employees placed in positions of authority with the power to control the circumstances of other employees are not personally liable. Their liability is placed with the employer even if the employee acts without authority. The same is true of independent contractors (whether properly characterized or not) placed in positions of authority over employees.

What if national origin or citizenship is a requirement of the job: Sometimes an employer may require a person to have a certain national origin, citizenship or immigration status to obtain a position. An exception is made in the law for what are called Bona Fide Occupational Qualification’s (BFOQ). BFOQs are complicated, however. You should always check with your employment counsel before enacting a BFOQ.

Can retaliation play a part: Title VII and the IRCA protects employees who engage in protected activities such as supporting another employee’s claim of discrimination, resisting instruction to discriminate, and filing a complaint about discrimination with the employer or the appropriate governmental agency. Employers cannot negatively impact a significant aspect of employment for an employee who supports another’s national origin, citizenship or immigration status or their complaint against discrimination based on these characteristics. Employers also cannot retaliate against an employee for complaining of discrimination based on these characteristics or making a charge of discrimination with the appropriate governmental agency.

What about harassment: Even if an employer does not discriminate against an employee directly, the employer may be liable if its employees harass an employee about his or her national origin, citizenship or immigration status. The harassment must be significant enough to interfere with the employee’s working conditions or ability to handle his or her job, but little harassing actions can add up to enough harassment to support a claim. An employer has a responsibility to be aware of what is going on with its employees and discipline employees for harassing conduct.

Common Situations:

Only English spoken here: USA Construction institutes a policy that all employees must speak English only, at all times. Is there a problem? Maybe. English only policies are subject to very strict scrutiny and are presumed invalid by the EEOC. Employers are better off making requirements that employees be capable of speaking English so that all staff can communicate in one language, but even these policies must be made for a demonstrable business reason. Advise employees of the requirement and explain the consequence of breaching this policy to all employees.

What was that you said: Borat accepted a position at Phonetics, Inc. Within the first week, however, problems arose. Borat, a recent immigrant from Kazakhstan, has a very, very thick accent and is hard for employees and customers to understand. His co-workers begin to ridicule him and the company lets him go. National origin claim? Yes and maybe. If Borat complained of the harassing ridicule, he may have a claim. If Phonetics, Inc. truly terminated Borat because no one can understand him, and it significantly impedes business with no way to adjust or fix it, there may be no claim on the termination.

Illegal failure to hire: Mike, an undocumented citizen of another country, applies for a job with Tourism Unlimited. He is qualified for the position but is not hired because he is an undocumented worker illegally in the US. Does he have a claim? Generally, undocumented workers who are not hired because of their undocumented status have no claim since it is illegal for businesses to hire them in the first place.

What Should I Do:

Good: Count up your workers every few months to know whether the law applies to you. Institute an anti-discrimination policy including national origin, citizenship or immigration status discrimination.

Better: In addition to developing a policy, control who is permitted to interview and make material decisions about employees to be sure they are aware of the concerns of these types of discrimination.

Best: In addition to the items above, create job descriptions for each position. Use the job descriptions to prepare advertisements for positions, to ask objective interview questions, and to create a uniform and objective performance review system to avoid accidentally discriminating against someone based on national origin, citizenship or immigration status.

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ReligiousDiscriminationWho, What, Why . . .

Who does it apply to: The law applies to all employers with 15 or more employees.

What is the issue: Title VII was passed in the 1960s to protect against discrimination based on race, color, religion, sex or national origin.

What am I required to do: Employers are required not to discriminate against employees on the basis of religion. More specifically, employers are required not to treat an employee adversely with any consideration of his or her religion in relationship to any significant aspect of employment.

What constitutes a violation: There are two kinds of violations – direct mistreatment and disparate impact. Direct mistreatment is straightforward. If an employer affirmatively mistreats an employee because of religion by failing to hire, firing, demoting or any other type of significant slight someone might dream up, it can be actionable as religious discrimination.

Disparate impact is more subtle. Even if an employer creates a policy that is neutral or non-discriminatory on its face, that policy might have a consequence of negatively impacting workers of one religion more significantly than others. If an employer institutes a policy that employees must all be clean-shaven, the policy itself does not seem discriminatory because it may affect any worker. That said, certain religions require their adherents to grow beards. This seemingly neutral rule has a disparate impact against workers of certain religions and may create a claim.

What counts as a religion: Good question. What counts as a religion goes way beyond what most employers would think. Observances are protected regardless of whether the employee belongs to the particular body or sect whose observance they claim. Any observance based on a strong moral or ethical belief that is sincerely held with the strength of religious views may count.

What if my employee violates without consent: Choose carefully who you place in charge. Employees placed in positions of authority with the power to control the circumstances of other employees are not personally liable. Their liability is placed with the employer even if the employee acts without authority. The same is true of independent contractors (whether properly characterized or not) placed in positions of authority over employees.

What if religion is a requirement of the job: Sometimes a person’s religion may affect his or her ability to get a job. With religion, this usually occurs with churches and other denomination- focused businesses. Under Title VII these business are exempt from the religious toleration requirement. This exemption is complicated, however. You should always check with your employment counsel before acting under the exemption.

Can retaliation play a part: Title VII protects employees who engage in protected activities such as supporting another employee’s claim of discrimination, resisting instruction to discriminate, and filing a complaint about discrimination with the employer or EEOC. Employers cannot negatively impact a significant aspect of employment for an employee who supports another’s religious views or their complaint against religious discrimination. Employers also cannot retaliate against an employee for complaining of religious discrimination or making a charge of religious discrimination with the EEOC.

What about harassment: Even if an employer does not discriminate against an employee directly, the employer may be liable if its employees harass an employee about his or her religion. The harassment must be significant enough to interfere with the employee’s working conditions or ability to handle his or her job, but little harassing actions can add up to enough harassment to support a claim. An employer has a responsibility to be aware of what is going on with its employees and discipline employees for harassing conduct.

Are there any special state laws on religious rights: The Texas Labor Code mimics Title VII’s protections, but goes one step farther. Retail employers must respect an employee’s request to be off to attend regular worship service on one day per week.

Common Situations:

Tattoo me religious: Dot is a sales representative for Mae’s Ink Works, a purveyor of the finest inks. She decides on a whim to get a tribal tattoo around her bicep. She likes it so much that she insists on wearing sleeveless shirts all the time. Mae is not hip to tattoos and feels the customers who buy her inks will be put off by Dot’s tat. Mae insists that Dot cover the tattoo at all times while working. Dot does not like Mae’s policy and talks to her tattooed friends about the issue. They turn her on to the Church of Body Modification. Dot joins and tells Mae she would be violating her religious beliefs not to show the tattoo. What happens? No employer’s life is complete until he or she has a run in with the Church of Body Modification. This is a common dodge for employees. Unfortunately, the answer is unclear. If Mae can show lost sales or complaints about the tattoo, she may have an out. Of course, the beliefs of this church present a problem for Dot. She is not required to show her tattoo. Unless she can show a strong belief and moral basis, she may be out of luck.

Google liability: Rosie is in the habit of Googling applicants to see what she can learn about them before an interview. In her examination of one applicant, she discovers that the person is a regular runner in a group through her church. Knowing that running is not a protected class, Rosie displays her knowledge in the interview of the prospect. Ultimately, Rosie chooses to hire someone else and the applicant files an EEOC charge claiming religious discrimination and relying on what Rosie must have found on the Internet. Has Rosie done anything wrong? Yes and maybe. Rosie should not Google applicants or at least she should not tell the applicants what she finds. If she did not feel the need to show off her knowledge, the applicant may have never known she looked. As to discrimination, it will be up to the EEOC and a jury to decide – after Rosie spends thousands on the assistance of counsel.

Hanukkah vs. Christmas: Michael is Jewish and a faithful adherent to all Jewish holy days. His employer, like so many companies, closes for Christmas, not Hanukkah. Michael requests that the company allow him to be off in celebration of Hanukkah and other Jewish holy days. The employer offers Michael the opportunity to take those days off without pay as a reasonable accommodation to his request. Michael, in turn, offers to work over Christmas to make up some of that time. His employer agrees. All is well. However, what happens if the company’s closure for Christmas prevents Michael from doing his job? Must the company pay Michael for his time off? Generally, no. It is considered reasonable accommodation to allow employees unpaid leave (or the use of vacation) during those days if the company is closed over Christmas.

What Should I Do:

Good: Count up your workers every few months to know whether the law applies to you. Once you have more than 15 workers, institute an anti-discrimination policy including religious discrimination.

Better: In addition to developing a policy, control who is permitted to interview and make material decisions about employees to be sure they are aware of the concerns of religious and other discrimination.

Best: In addition to the items above, create job descriptions for each position. Use the job descriptions to prepare advertisements for positions, to ask objective interview questions, and to create a uniform and objective performance review system to avoid accidentally discriminating against someone based on religion.

On November 17, a federal jury returned a verdict against AutoZone in favor of a single plaintiff for the insane amount of $185,000,000.00 in punitive damages. The plaintiff alleged gender and pregnancy-related harassment, discrimination, and retaliation. On November 19, a federal judge in the U.S. District Court for the Southern District of California upheld the jury’s verdict and finding on punitive damages. The case is entitled Juarez v. AutoZone (Case No. 3:08-CV-00417). An appeal will surely be filed.

Ms. Juarez was employed as an AutoZone store manager. Ms. Juarez alleged that when she became pregnant the district manager harassed her and attempted to force her resignation. She complained to AutoZone human resources department, but alleged that nothing was done. She further alleged that despite her complaints to human resources, she was demoted to parts manager while AutoZone promoted less qualified males. As a result of her perceived discrimination, Ms. Juarez filed a charge of discrimination with the California Department of Fair Employment and Housing and also filed suit. Subsequently, she was terminated and claimed that AutoZone retaliated against her for filing her charge and her lawsuit. The jury believed Ms. Juarez and returned a verdict in her favor finding that AutoZone was liable for discrimination, harassment, and retaliation. She was awarded $872,719.52 in compensatory damages and a whopping $185,000,000.00 in punitive damages.

While this is an extreme example, employer’s need to realize that there is real money at stake in a single plaintiff discrimination, harassment, or retaliation case. These cases must be taken seriously from the time a charge is filed with a state agency or the EEOC. As a practical matter, employers need to take measures in the workplace to avoid these claims ever being brought. A good employee handbook outlining an employer’s discrimination, retaliation, and harassment policies and a consistent application of those policies will certainly aid in prevention. While I doubt that the $185 million punitive damages award will hold up on appeal, it certainly should serve as an eye opener for employers across the country.

 

This month, our e-notification linked to the blog rather than the PDF of our Employer Handbook article.  Sorry.  If you are saving copies of the PDFs (hint, hint), please click here

 

Who, What, Why . . .

Who does it apply to: It is up to you. A business with two employees might benefit from an employee handbook. A business with 100 might function fine without one. There are no legal rules about when a handbook must be created.

Can I do it myself: Yes, certainly, but there are many pitfalls and many things to consider. Whatever an employer does, they must be careful to make policies that are consistent with their practices, and, of course, the law. Nothing is worse than downloading something off the internet that might follow the laws of another state and which is inconsistent with your goals and practices.

What policies should I include: That also is up to you, but I would consider these the most important:

  • Discrimination, Harassment, Disability, and EEO. The most legally significant issue a small business can address is the prohibition of discrimination among employees. Some of the discrimination laws don’t kick in until an employer has 15 or 20 employees, but at least one kicks in with just one employee. The policy needs to address both the prohibition and reporting.
  • Holidays, Vacation, Sick, or PTO. This issue is not as legally significant as it is practically important. The first couple of employees may be handled one way, but after a while, many businesses seem to struggle with consistency.
  • Family Medical Leave. This topic is only third because it doesn’t apply to a business with under 50 employees. Family medical leave is complicated to get right, and a written policy is the first step toward doing so.
  • Employee Dating. This is always a hot topic. I generally recommend employees not be permitted to fraternize and insist that supervisors, at least, not be permitted to date subordinates.
  • Employment At-will. If you employ people on an at-will basis (see the EH edition on this topic) it is important to confirm that nothing in the handbook creates a contract of employment for a period of time and that all employees are still at-will unless otherwise notified in writing.
  • Performance and Discipline. Consistency in these areas is important to protect against discrimination claims. Employers should lay out their disciplinary policy so there are no questions about the employer’s rights to terminate. I recommend leaving yourself the right to terminate for any issue if you feel it is important rather than using a regimented progressive policy.
  • Privacy. Make sure employees know that you can install video cameras, and search anywhere you like, including their desks, phones, and company email accounts.
  • Worker’s Comp. Whether you are a subscriber or not, consider addressing what employees need to do if they are injured on the job. You have legal obligations to report injuries within a certain period whether you are covered by the act or not.
  • Exceptions and Revisions. Always reserve the right to make changes without warning and clarify that there may be policies of the business which are not covered by the handbook – otherwise it would be as thick as a phone book.
  • Wage Deductions. Clarify in advance what deductions may be made from pay so the employees cannot cry foul. Examples include uniforms, damage to company property, theft, and repayment of loans.

What else should I address: Beyond these key topics the second tier policies are:

  • Military Leave. It is important to let employees know you follow the law regarding time off for deployment or for National Guard or Reserve duty.
  • Benefits. Provide an explanation of the types of benefits you offer employees including insurance and 401(k).
  • Bereavement. Let employees know what they can expect if they lose a relative. Who are they entitled to take time off for and what time do they get.
  • Jury Duty and Voting. Employees are legally granted the right to participate in both without losing their job. Define your policy and whether the employee’s time away from work for either is paid.
  • Accidents Involving Employees and Others. Cover what employees should do if they, a co-worker, or a third-party are injured in the workplace or while working.
  • Tracking Hours, Lunches, and Breaks. Let employees know when they are expected to be at work, when they get breaks, and how to keep track of their hours so that you stay out of overtime trouble.

Is a full handbook necessary: No. In fact, I imagine the first employee handbooks were collections of policies that someone decided to organize into a book. A business can get along with individual key policies set out in a way that all employees can find them.

Do I need employees to sign that they read it: It is a good idea to have employees sign a document acknowledging receipt of the handbook and confirming they have read it. This will help in the event the employee makes a claim about something covered by the handbook.

Are paper copies necessary: I advise clients that an electronic copy handbook is preferred. Store the handbook on an intranet or send a copy out to every employee by email. Using an electronic handbook makes editing the handbook much easier – no need to print a whole new copy for everyone or send out an addendum.

What should I do:
Good: Create policies that are important until you feel a handbook is necessary. Cover the basics.

Better: Build an employee handbook that meets your needs and reflects your actual practices. A handbook that reflects your ideal workplace (as opposed to how you actually do business) may be more hurtful if you find yourself in a dispute with a former employee.

Best: All of the above and go beyond a basic acknowledgement of receipt. Have the employees confirm their agreement to searches of their space, drug testing, employment-at-will, patent rights, their worker’s compensation election, and wage deductions. It may also be a good document to use for getting an agreement for periodic driving record checks and release of liability for references.

Who, What, Why . . .

Who does it apply to: The law applies to all employers with 15 or more employees.

What is the issue: Title VII was passed in the 1960’s to protect against discrimination based on race, color, religion, sex or national origin. Since that time, other laws have been passed adding protection against discrimination toward other groups. The Pregnancy Discrimination Act (“PDA”) was passed in 1978 to modify Title VII to specifically protect against discrimination based on . . . you guessed it . . . pregnancy.

What am I required to do: Employers are required not to discriminate against employees on the basis of “pregnancy, childbirth, or related medical conditions.” More specifically, employers are required not to treat an employee adversely because of these characteristics in relationship to any significant aspect of employment.

What constitutes a violation: There are two kinds of violations – direct mistreatment and disparate impact.  

  • Direct mistreatment is straightforward. If an employer affirmatively mistreats an employee because of pregnancy by failing to hire, firing, demoting, or any other type of significant slight someone might dream up, it can be actionable as pregnancy discrimination.
  • Disparate impact is more subtle. If an employer creates a policy that is neutral or non-discriminatory on its face, that policy might have a consequence of negatively impacting pregnant workers more significantly than others. An employer policy that employees who like pickles and ice cream together must be fired, is not discriminatory on its face because it may affect any worker. That said, conventional wisdom suggests that pregnant women like strange food combinations during pregnancy. This facially neutral rule has a disparate (greater) impact on pregnant workers and may create a claim for discrimination against the employer as to all pregnant employees. Of course, in the real world, the policy, the violation, and the impact will likely be much more subtle so these claims are often much more complicated to bring.

What if my employee violates without my consent: Choose carefully who you place in charge. Employees placed in positions of authority with the power to control the circumstances of other employees are not personally liable. Their liability is placed with the employer even if the employee acts without authority. The same is true of independent contractors (whether properly characterized or not) placed in positions of authority over employees.

Hasn’t this law been in the news lately: Why, yes. Yes it has. The Equal Employment Opportunity Commission (“EEOC”) recently issued new “guidance” for employers regarding the scope of protection for women under the PDA. Even though the PDA does not provide any of these protections in writing and pregnancy is not a “disability,” the EEOC has decided it will enforce the PDA as though pregnant employees must be given the same protections a disabled person is provided under the Americans with Disabilities Act (“ADA”). 

Specifically, the EEOC now insists that employers “reasonably accommodate” pregnant employees. For example an employer would need to redistribute non-essential functions of the pregnant employee’s job duties to others, modify a pregnant employee’s work schedule to take more breaks, or modifying equipment or seating to make the workspace more comfortable for pregnant employees. Additionally, the EEOC wants employers to implement light duty policies for pregnant workers to allow for different job duties during pregnancy or an altered work schedule.

Do I have to follow the EEOC guidance: Yes and no. While the EEOC’s guidance will probably not stand up in court as the law exists right now, it will cost a lot of money to fight it. Plus, there is a law proposed in Congress now entitled the Pregnant Worker Fairness Act which would essentially make the EEOC’s guidance law. In a year or so, the legal requirements will likely match the EEOC’s guidance so it can’t hurt to start abiding by the rules now.

Common Situations:

Maternity Leave: Doulas United is a small, Austin based, company providing pregnancy coaching for expectant mothers. Natasha, one of the company’s coaches, has, herself, become pregnant. When the time comes for Natasha to have her baby, she asks for maternity leave to care for her new child. Operating on a bit of a double standard, Doulas tells her the company just can’t afford to grant her time off. If she leaves to care for her newborn, her position will be given to someone else. Natasha makes a claim under the PDA. Is she in for a payday? Nope. The PDA only prevents discrimination. Doulas does not have 50 employees so the federal Family Medical Leave Act (which grants up to 12 weeks unpaid leave) does not apply. With no maternity leave law in Texas, Doulas can let Natasha go without creating a legal issue if she fails to return immediately to work.

Take that, EEOC: Anger Management Trainers, Inc. (“AMT”) hates government intervention and refuses to kowtow to the EEOC’s new guidance. When Sue asks for a new keyboard and desk set up as a reasonable accommodation of her pregnancy-related carpal tunnel syndrome, AMT management tells her to jump in a lake. Has AMT jumped into troubled waters? Unfortunately, yes. Even though the EEOC’s guidance is not law and won’t likely stand up in court at this time, Sue’s request is protected under the ADA. All pregnancy related illnesses are likely disabilities within the meaning of that law and reasonable accommodation must be afforded the employee.

Octomom: Billy operates Billy Bob’s Breeding, a thoroughbred horse breeder. Lilly has been a rising star in the company, but has become pregnant and plans to have more children. Billy, a father himself, treats Lilly perfectly during pregnancy and gives her three month’s maternity leave even though his company is not required to do so. Billy even pays Lilly ½ wages during her leave. When she returns, Billy welcomes her back into the company. Months later, however, when it comes time to choose a manager for the company so Billy can take more time off, Billy selects a male employee who is barely qualified. He just doesn’t feel that he can count on Lilly to handle the reigns with her new baby and plans for a bigger family. Has Billy erred? Yes. Even though he treated Lilly properly during pregnancy and immediately after, he cannot retaliate against Lilly for her pregnancy and plans for a large family.

What should I do:

Good: Count up your workers every few months to know whether the law applies to you. Once you have more than 15, institute an anti-discrimination policy including pregnancy discrimination.

Better: In addition to developing a policy, control who is permitted to interview and make material decisions about employees to be sure they are aware of the concerns of pregnancy and other discrimination.

Best: In addition to the items above, create job descriptions for each position. Use the job descriptions to prepare advertisements for positions, to ask objective interview questions, and to create a uniform and objective performance review system to avoid accidentally discriminating against someone based on pregnancy.

Who, What, Why . . .

Who does it apply to: This one is pretty straight forward. It applies to all employers contemplating any type of holiday gathering for its staff.

What are the legal issues: Holiday parties potentially implicate a variety of employment laws: Discrimination, Fair Labor Standards Act (“FLSA”), Workers’ Compensation, and liability associated with providing alcohol.

How is discrimination an issue: Discrimination is probably the biggest concern for an employer planning a holiday party. The primary two issues employers need to watch out for are sex discrimination (in all its forms), and religious discrimination.

Sex discrimination can take the form of harassment or treating a male or female comparably unfair in comparison to her male or female counterparts. At holiday parties, it most often is the result of one employee touching another or propositioning another inappropriately. What might even appear to be consensual during a party could be described as an unwanted advance once the employee makes it home to a spouse in need of explanation. All incidences of inappropriate comments or conduct should be closely watched for and broken up.

Religious discrimination also rears its head during the holiday season. Christians commemorate the birth of Jesus. Muslims celebrate Eid al-Adha, or the Feast of Sacrifice. Some African-Americans celebrate Kwanzaa. Buddhists celebrate Buddha’s Enlightenment with Bodhi Day. The Jewish celebrate Hanukkah and the Festival of Lights. Some Seinfeld devotees celebrate Festivus, and there are many others. With so many different points of view, employers must be careful as they plan for a holiday party.

That said, employers should keep an eye out for portions of the holiday party plan that might affect the other protected classes: race or color, national origin, age, genetic information, pregnancy, military status, and disability. Drinking alcohol is not usually involved in the work environment, but it is often available at holiday parties and a surprising number of people do not keep personal control when alcohol is available. This can lead to improper comments that an employee would have been smart enough to avoid without alcohol.

How is the FLSA an issue: Holiday parties conducted during work hours or which have a mandatory attendance requirement may result in the time being considered compensable for non-exempt employees. If the employees are required to attend, or feel required to attend because of some event at the party, they should be paid for the time including any applicable overtime.

What is the issue with workers’ comp: Employees are covered for injuries sustained while in the “course and scope” of their employment, which means furthering or carrying on the business of their employer. If attendance at a holiday party is required, the employee can make a workers’ compensation claim for injuries sustained – as long as those injuries do not result from horseplay or intoxication. Avoiding a workers’ compensation claim, however, may not be the right ticket because employees may then have a claim for negligence, which will not be covered by your carrier.

How can I be liable for providing alcohol: Under Texas law, an employer is generally not responsible for injuries to an employee or anyone that employee might injure, as a result of providing alcohol to that employee. One exception to this rule is providing alcohol to a person under the age of 18.

Common Situations

Office staff only: Jimmy, decides to have a “Holiday Party” for his office staff at Jimmy’s Janitorial Service. Jimmy decides that the actual crews would be too cumbersome to invite so he does not include them. Has Jimmy screwed up? Yes. It wasn’t religious discrimination and there was no sexual harassment, but Jimmy failed to take into consideration the fact that 98% of his office staff is white or black and 98% of his cleaning crews are Hispanic. While sexual harassment and religious discrimination are most likely to create a problem with a holiday party, employers must be mindful of unanticipated consequences.

But you assumed responsibility: Arnie, owner of Arnie’s Beer Goggles, decides to host a Christmas party for his staff at his home. Because he knows the dangers of sending inebriated employees home after a party, he decides that everyone must stay at his home overnight to avoid leaving drunk. After a fun filled evening, Arnie calls it a night about 2 a.m. and goes to bed leaving his employees apparently asleep in the living room. Around 3 a.m., one of the most heavy drinkers, Saul, decides to head home with his wife. On the way home, Saul hits a tree and is grievously injured. Does he have a case against Arnie or the company? Maybe, but not for providing the alcohol. Setting aside the fact that Arnie should not have called it a “Christmas party,” he made the mistake of taking responsibility for the safety of his employees. By making them stay at his home, but doing nothing to ensure they would do so – such as taking away their keys, Arnie may have engaged in a “negligent undertaking.”

What should I do

Instead of good, better, and best, this month, consider these remedies for the particular concern:

Sexual Harassment: Remind all employees of anti-harassment policies and applicability at a company party. Designate a hall monitor and put all supervisors on watch duty for any issues. React to complaints and politely break up any potentially dangerous decisions right away.
Religious Discrimination: Avoid decorations and themes associated with a particular religion. Make the focus of decorations wintery.

FLSA: To avoid the risk of paying employees to attend the party, have it during regular business hours you would have paid them for even without the party, or make attendance strictly voluntary. And, if you use voluntary attendance, be sure not to include any activities an employee might feel a need to be present for – such as handing out bonuses.

Worker’s Compensation: Minimize activity at the party. Dancing and drinking can make for accidents.
Social Host Liability: Setting aside the fact that skipping alcoholic beverages will lessen the risk, consider the following. Hire a bartender and instruct them who the minors are, if any, and to warn you if anyone appears to be over-served. Consider using the dreaded drink tickets to limit consumption or closing the bar early. Serve starchy food that will soak up alcohol more quickly. Offer to reimburse for taxi service.

Who, What, Why . . .

Who does it apply to: Any employer interested in protecting their business from the potential consequences of not doing background checks and some employers who are otherwise required to perform checks.

What kind of checks are there: At first, you might just think of the basic criminal background check and verifying references, but there are many types of checks to consider:

Litigation\Bankruptcy: Does the person have a propensity to sue, and if so, for what, discrimination? Should the person be handling your money if they have filed bankruptcy before?

Education Verification: How many stories are there about people who do not have the degree they claim? Universities regularly get requests of this type. For their own protection, the schools often require written consent.

Military History: What kind of a soldier were they? What were the circumstances of their discharge?

Drivers License: Is this person going to drive one of your vehicles? Might they ever drive for work purposes in their own car? What if they have a bad history and get into a wreck? How will that be used against your business in court?

Drug Tests: Do you want to put a worker out there who takes cocaine on the weekends?

Licensing Boards: If the employee is licensed, like an attorney, have there been any complaints? How were they resolved? Boards that are government affiliated usually will provide information without a written consent, but it is worthwhile to have one ready.

“Googling”: I guess it is a verb now. What does the person’s internet persona look like? Are they the author of a blog that your clients might not appreciate?

Social Media Reviews: What have they posted on Facebook? Twitter? What kinds of pictures do they post on Flickr?

Credit Check: Can your employee handle their finances? If not, what does that say about their ability to manage your money? What distractions might money trouble bring?

Will I need consent: Under the Fair Credit Reporting Act, consent is required for criminal and credit background checks. The military will not provide service records without consent. Universities vary. Some will provide a date of graduation and degree earned without consent, but transcripts are almost never provided without written consent. Always obtain a written consent for drug testing regardless of whether it is required because it is an invasion of privacy.

What can I do to get better responses on references: I advise employers not to give references. There is no upside and the downside may be getting sued by a former employee. So, what can you do to pull some extra information out of a tight-lipped employer? Obtain a release from the applicant for the benefit of his or her former employers. You can also pass along a copy of Texas Civil Practice and Remedies Code Chapter 103, which provides immunity to employers who provide references as long as they don’t say anything maliciously false.

Are there problems with internet searches: Finding what is said about a prospect can be helpful, but it is fraught with peril. While searching, you may find your applicant listed as a deacon for their church. Without intending to do so, you just asked the question about your applicant’s religion. There are companies that do a better job than just “googling” to gather an applicant’s internet persona and they sanitize the results of any protected class information to avoid you learning things you would rather not.

How can I access an applicant’s social media sites: Some people post their entire lives on Facebook or tweet everything that goes on. This creates a huge body of semi-public information about the person you might prefer your clients not see. For this reason, many employers are asking applicants to provide passwords so they can review what the employee has posted. To combat this, Facebook has instituted a rule that members cannot give out their password. While the rule is of no consequence to you, it does not send the right message to ask a prospective employee to violate their agreement with Facebook.

There is a way, however, for an applicant to print out everything they have posted in the last few years so you can examine it. The problem with this approach is the same as “googling,” but avoids the fuss over passwords.

Are there special rules for certain checks: Yes. If credit or criminal history is used to make a hiring decision, the employer must provide a copy of the report along with a written note to the applicant explaining the effect. Also, there are requirements to correct erroneous addresses with the reporting credit companies. If you receive a letter from the credit reporting company regarding an incorrect address, you must confirm the address (check with your lawyer – the rules are specific on how) and report back to the credit agency.

What are the limitations on criminal background checks: In Texas, background companies are not permitted to provide criminal histories going back further than seven years unless the annual salary is expected to be over $75,000.00. Many out-of-state companies ignore this rule. Doing so is a violation of Texas law for them, but not the employer. That said, I encourage employers not to use information over seven years to avoid the possibility of a claim they conspired with the background company. Also, be sure to review our prior EH edition on discriminatory use of criminal checks.

Common Situations

It won’t happen to me: Data Entry, Inc. hires Mary to – wait for it – enter data. The company conducted a thorough background check of Mary’s criminal and credit histories and contacted all of her former employers. One Friday afternoon, the server goes down and someone from Data Entry has to run over to the IT company to pick up a part. Data Entry sends Mary and instructs her to hurry because there is a deadline looming on a project. Mary jumps in her car and promptly runs a red light trying to get there quickly. In the process, she runs down 10-year old Johnnie, turning him into a quadriplegic. During the deposition of Data Entry’s president, the lawyer for young Johnnie hands over a copy of Mary’s horrific driving record and asks the president to explain why they let Mary run the errand. Simply put, the cost of a driving record check would have been much less than the $25 million a jury will award Johnnie.

No addicts on my payroll: Devin at Weed Removers, Inc. isn’t going to have any druggies on his payroll. He tests all of his applicants for all possible illegal drugs. Rod applies for a job and signs a consent to be tested. The test comes back positive for prescription pain medicine. Devin rejects Rod and says he ought to get some help. Instead of going for help, Rod runs down to the nearest EEOC office to file a claim under the Americans with Disabilities Act. Has Devin done wrong? Unfortunately, yes. As it happens, Rod has a back injury and Devin’s failure to meet the requirements for a post-offer of employment health screening has just violated the ADA.

It’s the Delivery Man: Rick’s Remodeling regularly sends crews into residential homes to handle projects. One of Rick’s employees becomes upset with a customer and starts a fist fight. The customer is injured and sues for damages. Is Rick liable? Maybe not. Texas law provides a certain level of immunity for business owners who run background checks on employees who perform in-home services or residential delivery and set-up services. There are many different types of businesses where background checks are required or beneficial: banking, nursing, nursing homes, and childcare facilities just to name a few. Be sure you are compliant with the law for your type of business.

What should I do

Good: Make at least the kind of background checks that protect you from liability to others: driving record, basic educational confirmation, criminal history, and possibly a drug test. Get written consent for the tests or you may become liable to the applicant.

Better: All of the above, plus the additional checks listed with the exception of “googling.” Always get a consent for all types of tests.

Best: Good and Better, plus, invest in a background check that covers all the bases and sanitizes results for information about protected classes.

Who, What, Why . . .

Who does it apply to: Virtually all employers with employees of the opposite sex are subject to the Equal Pay Act (EPA).

What is the rule: Employers cannot pay one sex higher wages than the other for jobs that require equal work based on skill, effort, and responsibility that are performed under the same working conditions unless there is a legitimate exception to justify the difference.

What counts as “wages”: Almost anything you offer as an incentive to an employee is counted under the EPA. It includes pay, bonuses, expense accounts, allowances, lodging, use of a company car, etc. It also includes fringe benefits such as insurance, retirement benefits, leave, vacation or PTO, holidays, and regular days off.

What goes into equal work: Under the EPA, job titles don’t make much difference. The EPA looks across descriptions to make sure like work goes with like pay. To answer the question you set aside the common core duties between the jobs in question and focus on the differences in the following:

Skill: Consider the experience, training, education, and ability required to do the job (not of the person doing it).

Effort: Consider the level of physical and mental exertion required to do the job including factors that create or alleviate stress in performance of the work.

Responsibility: Consider the degree of accountability, creativity, supervisory responsibility, and individual judgment that go into performing the job.

Working conditions: Consider the surroundings and hazards of the position. Is it dangerous or distasteful? Is it unpleasantly hot or cold?

If these characteristics are the same or very similar, the jobs will be considered the same under the EPA and any differences specifically between the sexes will create liability – unless an exception applies.

Are there exceptions: The following exceptions may allow disparity over wages between the sexes:

Seniority: A male employee hired five years ago may make more than a female employee hired five minutes ago so long as the seniority system is formalized and has been followed closely in the past.

Merit: A female employee who has performed admirably in an orderly and systematically applied system may make more than a male counterpart for the same job. Merit systems should be formalized such that they are in writing or all of the employees are clear on the policy.

Quantity/Quality pay systems: Male and female employees paid based on the quantity of items they produce or the quality of the work they produce may be paid differently so long as there are no other extraneous discriminatory factors affecting their pay.

Factors “other than sex”: The black hole of distinctions. It could be anything, but it better be well thought out and documented. Examples that have been accepted in this category are experience, training provided without discrimination, financial crisis, differences in educational background of the employees, and actual economic benefit to the employer (one employee produces higher profits in the same job).

Common Situations:

Market force theory: General Electronics has discovered that women will historically and statistically work for less than men and rarely attempt to bargain a better wage at hiring. Upon suit by an employee, the company raises this as a defense. They pay women less because they are willing to work for less. Will this defense hold up? No, but it has been tried in several variations many times.

Red circle rates: Sarah has been with Bayou Bakery for 35 years and just can’t knead the dough like she used to. Without reducing her pay, Bayou moves Sarah to an inventory clerk position. Several males in the inventory clerk position file an equal pay claim because Sarah makes so much more. Will Bayou be sacked? No. Courts have found this to be an acceptable reason “other than sex” to have a different wage. And remember, the EPA goes against both sexes. Men can make claims, too.

Extra duties: John has the extra responsibility of turning on the lights and unlocking the doors each day at Steam Clean America. Amy, Mary, and Jane have the same job as John at Steam, without the extra task regarding lights and locks. John is paid more than the ladies and they file a claim. Will John’s extra duties justify his higher wage? Probably not. While extra duties can be a justification “other than sex” to pay more, they have to be more than just turning on the lights. Of course, if the difference in pay is very small, a court may consider and accept the difference. The size of the difference in pay between the sexes is a consideration in determining equal pay claims.

Successor liability: During the process of finding a replacement for his office manager, Suzy, Dr. Jose Cuervo discovers Stan. Stan has almost exactly the same qualifications Suzy did for the position, but Dr. Cuervo retains Stan for 10% more in salary. Suzy learns this from a close friend still working for Dr. Cuervo and makes a claim. Will she be successful? Probably. A former employee can reach in and get the difference in pay plus penalties going back up to three years against an employer in circumstances like this. Unless Dr. Cuervo can come up with additional job duties which Stan has agreed to or some other excuse, he will get bottled up on this one.

Not from around here: Joe’s Auto Parts has facilities and stores all over the U.S. All the locations have their own HR representatives that handle hiring, firing, promoting, and wages within nominal guidelines set at corporate. Natalie, who works in the Lubbock facility learns that male employees performing the same job in Harlingen make more for the same job. Joe’s is sunk right? Not likely. The EPA only applies to violations that occur within the same “establishment.” Offices and locations that are geographically and operationally distinct will not be treated together for violations.

What should I do:

Good: Pay all employees in the same position the same wage – including all forms of fringe benefits unless there is some reason to justify the difference.

Better: If you use a seniority or merit system, memorialize it in writing and follow it religiously. Set merit raise promotions for certain projects in motion with a writing to the employees involved. Prepare written notes for all discretionary bonuses awarded by position. Be careful that benefit packages for positions are offered to all persons in those positions. Be wary of changing benefit packages with new employees to avoid risk of accidental EPA claim.

Best: Create job descriptions and use them to identify positions with similar responsibilities and evaluate differences to make sure they justify the price difference in wage, if any. Memorialize in writing all reasons for paying the sexes differently in any position. Follow the exceptions or identify the duties that make the distinction in writing

Even law firms get sued for discrimination once in a while, but you would expect lawyers to be smart enough not to serve Big Red and fried chicken to black employees in celebration of Juneteenth.  Talk about stereotyping!!

Sadly that is just what has happened to Dallas law firm Eberstein & Witherite (Better known as the 1-800-Carwreck firm).  The firm’s “all white” management allegedly made the decision to celebrate Juneteenth with Big Red and Fried Chicken after two employees asked to have the day off.

According to the petition, the firm’s HR manager replied to the request by saying:  “Y’all don’t need no day off. Ya’ll need to work.”  She then allegedly sought and obtained permission to serve Big Red and fried chicken to employees on that day instead.

For those who are not familiar, Juneteenth, or, Freedom Day, is an unofficial holiday on June 19 each year to commemorate the announcement of the abolition of slavery in Texas.  On June 18, 1865, during the civil war, Federal General Gordon Granger landed on Galveston Island.  The following day June 19th, General Granger proclaimed the slaves of Texas freed.  Over time, a celebration developed around the day each year.

The law firm’s racist traits do not appear to end with the Juneteenth incident, however.  The lawsuit alleges that the firm’s HR manager made other comments such as:

  • Complaining that she is “sick and tired of Black women bitching about being the victim” (interesting for a personal injury firm).
  • Quizzing black employees by saying “I don’t even know if you’re Black.”
  • Commenting “Oh no. You’re not going to have that mad, bitter Black attitude with me.”

Later, the firm is alleged to have terminated both black employees for being unhappy with their jobs.

Handling these types of cases for as many years as I have, you would think nothing surprises me anymore.  This one did.  Take a lesson from the claims made here:  Don’t try to be cute.  And, (no opinions cast here) be sure that your HR Manager is not a racist.

Who, What, Why . . .

Who does it apply to: All employers – who have ever wondered whether an investigation of some sort should be made regarding an issue involving employees.

Should I investigate: Let’s face it, not every dispute will merit an investigation, and sometimes, the investigation merited will not require all of the steps below. Like so many issues in business, it comes down to an evaluation of risk, and in some cases that might mean intentionally not investigating. For example, it is tempting to always conduct a post-accident investigation, but what if your employee has injured a non-employee who might sue? It might be wise not to have a drug test as part of the investigation. Keep all of these considerations into mind.

Who should do it: This question may be more complicated than you think. Impartiality, professionalism, and credibility are the keys. How would a jury perceive your decision? Should it be someone of the same race, color, or religion (as an example) for a discrimination claim so a jury will find the investigator more credible? Should it be a team to double the potential credibility?  If the head of the company or an executive is under investigation, it may be better to choose an outside investigator. An outsider is also worth considering if the situation already seems headed toward litigation, i.e. a claimant has filed an EEOC charge or hired a lawyer. Should your investigator be your lawyer, or a lawyer? Attorney client privilege attaches to your discussions with a lawyer and that can be a powerful protection if you don’t want your investigator to be forced to discuss their private conversations with you about the investigation.

What is the plan: Take time to think before you act. It may be tempting to jump right in and start talking to folks, but Mom always said to think before you speak. What do you already know? What do you need to fill in the blanks? Who should you interview? What order should you interview? What should I ask? When should I start? Do I need outside help, i.e. should I involve the police in a theft or violence investigation or a forensic accountant in an embezzlement investigation? Does anyone need to be suspended until the investigation is concluded? This could be appropriate in a number of instances such as letting a thieving, drunk, or violent employee back into the office.

How should the interviews be conducted: If you are not going to use the assistance of a lawyer or experienced investigator, you should think about how you will ask questions of your interviewees. Things lawyers naturally take into account when interviewing or questioning a witness include: asking open ended questions; avoiding accusatory questions that put a witness on the defensive; repeating the story as you understand it to be sure it was understood initially; whether you have gotten the facts or just a string of opinions; and what contradictions in the story need to be ironed out. While interviewing keep your opinions, observations, and the results of your investigation to yourself. Finally, if you are in a union environment, be alert of the interviewee’s rights to representation.

What about recordings: It may seem convenient or the best possible evidence to record interviews. After all, no one can argue with a recording. That is true, but it means your words as questioner will be put under the microscope, too. Recording interviews also may stunt the interviewee’s responses. I personally prefer clients to take copious notes. That said, if an employee wants to record the interview you should allow it on condition that you receive an immediate copy. Because Texas allows a conversation to be recorded as long as one side knows it is being recorded, ask the interviewee if they are recording to be sure you know what you are up against.

Where else will there be evidence: Though the outcome of a lot of investigations will turn on the interviews, there are a myriad of other places that evidence may show up. Emails will often play a part, but consider these other additional sources of evidence: electronic documents, voicemails, texts, pictures, sales receipts, equipment logs, notes, expense reports, inventory records, payroll records, customer complaints, prior warnings, productivity reports, and any other place you might find something to support the final determination. Remember, from our prior EH edition on polygraphs that they can be used in appropriate circumstances, but strict procedures must be followed.

Are there privacy or confidentiality issues: As you know from the previous EH edition on privacy, there are few privacy rights in the workplace, but you have to be careful. Searches of areas where you have created an expectation of privacy are prohibited as is listening to telephone calls without consent. You should maintain confidentiality of your investigations and be careful who is in the loop to avoid rumors. Under the National Labor Relations Act, you can ask employees to maintain the confidentiality of their interviews or put a “gag-order” over discussion of the incident at issue only when you can demonstrate that such confidentiality is essential to the investigation. And, when the investigation is over, you must release employees from the confidentiality obligation unless it remains justified.

What should I do (the result): Only you can decide the right answer, but whatever the result may be, you must document it.  Prepare a final assessment commensurate with the severity of the investigation documenting your reasoning and final decision.  Depending on the circumstances, it is always good to consult with your employment lawyer about the legally correct result under the circumstances.

Common Situations:

Regimented mistake: The HR VP at Smiley Face, LLC decided to have the department manager where a discrimination claim arose conduct an investigation. Because the manager was not experienced in handling discrimination claims, the HR VP provided him very strict guidelines for the investigation and the questions to be asked. The manager followed the HR VP’s instructions to the letter interviewing the employees listed and collecting documents requested. Because Suzy was not on the list to be interviewed, the manager did not follow up on the observation she might have valuable information. In fact, Suzy knew specific facts to support the discrimination in an otherwise close case. Business owners have to guard against such a regimented approach. Go where the investigation takes you.

Be wary: Melvin has just taken ownership of Shady Pines Nursing home. The prior owners warned him that the residents often complain of mistreatment by the staff when nothing really happened. Mel takes this to heart and looks the other way when Sophia complains about the staff locking her in her room to keep her from riling up the other residents. Has Mel made a bad decision? Of course. He is required, by law, to investigate all claims of patient abuse even if Sophia is just making it up. Workplace investigations are not always optional. Know the legal requirements for your industry and conduct tests when they are necessary.

What should I do:

Good: When an issue arises, take a moment to determine whether an investigation is appropriate and the scale of the investigation. Let the right person handle it and record the result.  Investigate when legally required to do so in your business.

Better: All of the above, plus, preserve copies of all physical evidence and document the results and any interviews. Be sure to document delays in starting to be able to justify later.  Make sure your employee handbook provides for all manner of searches and surveillance to compliment your investigations.

Best: That is all. Good and Better get it done this month.