Discrimination in the Workplace, Employee Rights, Pregnancy Discrimination Act

AutoZone Lawyers Crash into the $186 Million Pregnancy Zone.

Pregnant woman at work with laptop looking stressedCertain types of employment lawsuits, like certain cars, are more dangerous than others, as AutoZone Stores – and its legal department – recently learned the hard way.

Store manager Rosario Juarez claimed she was harassed, demoted and terminated because of her sex and pregnancy, and was a victim of a “glass ceiling” at the company. She presented an array of damaging facts at trial, including that after years of successful employment and promotions, within one month of disclosing her pregnancy she was asked to take a lower position due to her pregnancy and suffered “more aggressive, mean and critical” supervision. When she complained to the human resources department, nothing was done and the record of her complaint was destroyed, she claimed. She also put forward evidence that the vice president of operations had said, “what are we running here, a boutique? Get rid of those women.”

This all sounds pretty bad, right? It gets worse. After she filed a charge of discrimination with the California state government, she was fired, with the company blaming her – apparently falsely – for a missing cash envelope.

At trial last year, a jury awarded her $872,720 in economic damages and emotional distress, and a whopping $185 million in punitive damages. The jury’s exorbitant award reflects, in part, how strongly our society feels about the mistreatment of pregnant women.

Late last year a federal judge affirmed the punitive damages award. In an opinion that should send chills down the spines of in-house counsel, the court noted that it was lawful to hold the company responsible for willful violation of the law as the jury could have found that AutoZone’s legal department “committed, authorized and/or ratified” the malicious, discriminatory actions. AutoZone is expected to appeal.
The case highlights that certain plaintiffs – the pregnant, the ill, the injured, the old and the weak (as well as those who selflessly care for them) – are more sympathetic than others, especially when they have a solid work history, as Ms. Juarez apparently did.

Don’t let this happen in your workplace – get in the zone – the empathy zone.

Michael Homans is a Labor & Employment attorney and founding partner of HomansPeck LLCFor more employment law updates, including news and links to important information pertaining to legal developments that may affect your business, subscribe to Michael’s blog, or follow him on Twitter @EmployLawUpdate.

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Employee Rights, Employer Rights, Pennsylvania's Minimum Wage Act

Waiting time compensable?

The U.S. Supreme Court held in December in Integrity Staffing Solutions v. Busk that federal law does not require employers to pay employees for time they spend waiting to undergo antitheft security screenings in the workplace, but that’s not the end of the issue.

Many states have wage payment laws inconsistent with federal law on the duty to pay for activities “preliminary to or postliminary to” the principal work activity. Pennsylvania’s Minimum Wage Act, for example, requires employers to pay for “time during which an employee is required by the employer to be on the premises of the employer,” and that presumably would include waiting time for a security check.

So, be careful out there and check your state laws.

Michael Homans is a Labor & Employment attorney and founding partner of HomansPeck LLCFor more employment law updates, including news and links to important information pertaining to legal developments that may affect your business, subscribe to Michael’s blog, or follow him on Twitter @EmployLawUpdate.

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Age Discrimination in Employment Act, Retirement

“You’re old enough to retire, right?”

Get somebody at your company to say these magic words three times, click your heels, and your company may be liable for a $2.5 million jury verdict for age discrimination.

That’s the lesson of Castelluccio v. IBM Corp., decided last week in Connecticut.

James Castellucio worked at IBM from 1968 through 2008, including service as a vice president overseeing 2,500 employees. But when IBM assigned a new supervisor to Castellucio, the ageist comments started and soon thereafter he was fired at age 61. The new supervisor admitted at trial that she knew asking Castellucio about his retirement plans – after he said he wanted to stay at IBM – was illegal, yet she did it three times.

That was enough for the jury – which awarded the $2.5 million verdict – and the judge – who ruled the comments were direct evidence of age discrimination, and tacked on a $1.2 million award of attorneys’ fees. Our guess is that Castellucio can retire now.

Although it may seem surprising, we frequently see situations in which managers use some form of the word “retirement” when dealing with the displacement of older workers. Don’t use that word. Do not assume a worker in his or her 60s or 70s wants to retire. And don’t do anything you know is illegal three times in a row.

Michael Homans is a Labor & Employment attorney and founding partner of HomansPeck LLCFor more employment law updates, including news and links to important information pertaining to legal developments that may affect your business, subscribe to Michael’s blog, or follow him on Twitter @EmployLawUpdate.

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Employee Rights, Employer Policy, Employer Rights, Valentine's Day, Workplace Romance

Legal Alert – Valentine’s Day Edition: Is Office Romance Forbidden?

Guest Blogger: Adam Gersh, Shareholder, Flaster/Greenberg PC

It is Valentine’s Day and love is in the air, but also at the water cooler. A recent study found that—even in the age of online dating—the largest percentage of spouses met through work (21 percent). Another study found that 18 percent of couples who meet at work get married. Although it is inevitable that romances will develop out of workplace relationships, it is not all champagne and roses for employers, especially if a relationship sours.

From a legal perspective, consensual romantic relationships between coworkers, or even between a supervisor and an employee, do not, constitute sexual discrimination or harassment. Nonetheless, workplace romances can create particularly tricky situations for employers because:

  • Good relationships gone bad create risks (example: when a sexual harassment claim arises out of a failed relationship between a manager and subordinate, there may be extensive evidence of sexual or sexually suggestive conduct that is subject to multiple interpretations, some of which are unfavorable to an employer)
  • Disparity in work assignments arising from the relationship can negatively affect employment (example: upper management wants to discipline an employee who never works the night shift when, in reality, the employee’s schedule is a consequence of his romantic relationship with his direct supervisor who wants to keep the employee’s nights free for dating)
  • Favoritism causes peers to perceive they are being discriminated against (example: a paramour is not disciplined for late arrivals such that when her co-worker is disciplined, the co-worker believes she is a victim of discrimination)

Each situation is unique, but the underlying commonality is that romantic relationships between coworkers can throw off office equilibrium.

Due to the host of potential risks that may arise, employers should consider adopting policies to mitigate the risks caused by employees’ romantic relationships. However, there are no one-size-fits-all solutions. Larger employers may have the capacity to prohibit employee-supervisor relationships and adopt a policy of reassigning one of the employees, but many smaller employers simply cannot create that kind of separation.

Though an outright ban on office romances is not always necessary (and often impractical), employers should make sure they are aware of and document relationships by, at the very least:

  • Adopting a policy requiring employees to disclose a workplace romantic relationship to human resources or a chief officer immediately, especially when the employees are in the same chain of command
  • Requiring the employees to acknowledge their relationship in writing (often with an agreement called a “love contract”), including, among other things, a statement that the relationship is consensual, that the employees understand they are still subject to and protected by the employer’s anti-harassment policies, and that the employees may be subject to discipline if they allow the relationship to interfere with their employment duties
  • Seeking a release of all potential legal claims

The key is for the organization to implement disclosure and response policies that fit the culture and manage risks.

Once an employer is on notice of a romantic relationship in the workplace, it should take steps to evaluate and reduce the risk, including enforcing its policies consistently. The consequences of inconsistent enforcement can be real. In a recent California case, an employee involved in a workplace romance alleged that his employer disciplined him differently from similarly-situated employees who also had workplace relationships. The employee claimed he was treated differently due to discriminatory motives. This is just one example of the many ways inconsistent enforcement puts an employer at risk even if there is no discriminatory intent.

Does this mean there’s no place for love in the workplace? Certainly not. A number of studies have found that workplace romance can have a positive effect by increasing job performance, overall job satisfaction, an employee’s level of involvement, and organizational commitment. Well-tailored policies help employers maintain stability in the workplace and limit the risks that arise from office romances.

We simply suggest that employers create and enforce strong policies that meet their situation.

This is the blog of Michael Homans. Michael Homans is a Labor & Employment attorney and founding partner of HomansPeck LLCFor more employment law updates, including news and links to important information pertaining to legal developments that may affect your business, subscribe to Michael’s blog, or follow him on Twitter @EmployLawUpdate.

 

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Employee Rights, Fair Labor Standards Act (FSLA)

Don’t fluctuate with your workers in Pennsylvania

Reinforcing the basic rule that employers must comply with both state and federal wage and hour laws, a Pennsylvania employer recently learned the hard way that the “fluctuating workweek method of paying overtime” is not allowed in Pennsylvania.

Under the federal Fair Labor Standards Act, an employer may use the fluctuating workweek method to pay certain employees overtime at the rate of one-half of the employee’s regular rate, as opposed to the standard overtime rate of one-and-one-half times the employee’s regular rate. The FLSA allows this treatment if (1) the employee is paid a base salary above minimum wage every week, regardless of hours worked; (2) the employee’s hours fluctuate from week to week; and (3) there is a “clear mutual understanding” that the salary covers all hours during the workweek, regardless of hours worked.

In Foster v. Kraft Foods Global Inc., Kraft paid a sales representative under the fluctuating workweek standard. After her employment ended she sued under the Pennsylvania Minimum Wage Act, alleging that Kraft had failed to pay her overtime at the rate of one-and-one-half times the regular rate.

The federal court for the Western District of Pennsylvania refused to dismiss her claim, despite Kraft’s apparent compliance with the FLSA, noting that Pennsylvania law does not allow payment of overtime by the fluctuating workweek standard, and citing two prior court decisions that reached the same conclusion.

Michael Homans is a Labor & Employment attorney and founding partner of HomansPeck LLCFor more employment law updates, including news and links to important information pertaining to legal developments that may affect your business, subscribe to Michael’s blog, or follow him on Twitter @EmployLawUpdate.

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