Below is a review of the posts (on Facebook, LinkedIn, and X [formerly Twitter]) from the past week. You can check out the full posts by clicking on the links.
The post on Sunday 2/25/2024 reminded us that non-discrimination should start at the top, EEOC advises. Because it doesn’t always, an employer will pay $145,000 to settle allegations that the business owner told an employee to retire and referenced “old-timers disease”. The employee worked at Pete’s Car Smart, a dealership based in Amarillo, Texas, for nearly 18 years. After the employee underwent bypass heart surgery, the owner told the employee he felt she couldn’t perform the job any more. If she didn’t retire, she would be fired, he said; other comments he made, and how he said them, are noted in the post. The parties agreed to the monetary settlement and the employer also agreed to nonmonetary relief as listed in the post.
In announcing the settlement, an EEOC official reminded employers that, “Effective messaging to staff that promotes a non-discriminatory work environment should start at the top.”
TAKEAWAY: Employers should not take adverse action against employees based on negative stereotypes about age or health (or other protected characteristics); act based solely on performance to stay on the right side of legal.
The post on Monday 2/26/2024 told us that SCOTUS makes it harder for employers to defend against federal whistleblower claims. And yes, you care.
In the Supreme Court’s recently issued, unanimous, pro-employee ruling in Murray v. UBS Securities, LLC the Court rejected the argument that an employer must have intent to retaliate against a whistleblower under the Sarbanes-Oxley Act (“SOX”). Rather, the only showing required is that the whistleblowing is a “contributing factor” to the adverse action. However, the Court noted, the employer may still rebut the finding as noted in the post. While most employers should already be careful when taking adverse action against employees who have raised complaints implicating protected activity, the Murray decision may make more employees file whistleblower claims.
So why do you care? Because even though the Court’s ruling parsed SOX, it impacts how many employers will defend not only SOX whistleblower claims but also similar claims under 16 other federal laws with whistleblower-protection provisions that apply the same burden-shifting framework. So what does that mean employers must do? See the post.
Note that Murray does not change those federal laws that require higher standards of proof for retaliation and require a showing of animus; some are listed in the post (with their burdens).
What is SOX, you ask? It was passed in 2002 in response to widespread corporate fraud, including (purportedly) by WorldCom, Tyco International, and Enron. Estimated losses totaled more than $250 billion. Under SOX, publicly traded corporations must act as noted in the post. And, most important here, SOX prohibits employers from “discriminating against an employee . . . because of protected activity” such as reporting “criminal fraud or securities violations.” The basis for the SOX standard for proving a retaliation claim is noted in the post. To establish a claim, an employee must prove they were “discriminated” against for engaging in protected activity. But if the employee does so, the employer can still rebut and prevail on the claim as detailed in the post.
Let’s go back a bit and look at the background of the Murray case. Trevor Murray, a former UBS research strategist, filed a whistleblower claim alleging that UBS had terminated his employment for engaging in protected activity after Murray informed his supervisor that he believed two leaders were engaging in “unethical and illegal efforts to skew his independent reporting.” More details on Murray’s claim are in the post. Shortly after whistleblowing to his supervisor, the supervisor recommended that Murray be removed from his role. UBS, however, gave a different reason for the termination; see the post. UBS argued that it was entitled to judgment as a matter of law because Murray “failed to produce any evidence that [his supervisor] possessed any sort of retaliatory animus toward him.” After a trial, the district court instructed the jury to first consider whether Murray’s whistleblowing activity was a “contributing factor” to the adverse employment action, rather than the “primary motivating factor.” It then instructed on the rest of the burden-shifting as described in the post. The jury ruled in Murray’s favor. On appeal, the Circuit Court vacated the jury’s verdict and remanded for a new trial with the basis for its ruling as noted in the post).
Then the case got to the Supreme Court which held that an employee must prove their protected activity “was a contributing factor in the unfavorable personnel action,” but not that the employer acted with “retaliatory intent.” The decision resolved a circuit split on the burden of proof for SOX. Details on how the Court arrived at its decision are in the post. Since the Whistleblower Protection Act was involved in the decision, the outcome affects other federal laws that incorporate the Act’s burden-shifting framework.
And that brings us full circle to the challenges the ruling provides to employers defending whistleblower claims. It may give a boost to employees bringing such claims – see the post – which will then require employers to defend their employment decisions by “clear and convincing evidence” that they would have fired the employee even absent the protected whistleblowing activity.
TAKEAWAY: Murray changed the burden of proof in whistleblower claims under SOX, but that burden may already be part of other federal employment laws. Know what all parties need to prove; an employment lawyer can be of great assistance.
The post on Tuesday 2/27/2024 warned us to be wary of online employee handbook tools – they may have costly compliance gaps. Like many employers, if you need to write or update an employee handbook, you may google “employee handbook tools” or “handbook templates” to get help. A few things that may pop up in your search results are listed in the post. And while those tools may help for completing a draft version/revision of your handbook, they might not be suitable for every employer for many reasons (some of which are noted in the post). Handbooks should be tailored to the employer’s specific needs and experience. A cut-and-paste job can lead to costly compliance or other legal mistakes. An example is given in the post.
So what should employers do? Have an experienced employment lawyer look at the draft (revised) handbook to ensure legal compliance. Other best practices are listed in the post.
TAKEAWAY: Handbooks are important to let employes know what is expected of them, what benefits might be offered, and how the employer will act in certain areas; but those handbooks must be legally compliant or they can cause trouble for the employer down the road.
The post on Wednesday 2/28/2024 noted ‘Not our responsibility,’ HOA insists in sidewalk battle costing homeowner $1,500 – but he took them to court. Robert Beirne had an issue back in 2020 with tree roots pushing up the sidewalk in front of his home, created a tripping hazard that Beirne wanted to resolve. The extent of the problem is noted in the post. He told his HOA about it; they said it was his responsibility to fix the sidewalk. Beirne had to fix the sidewalk twice, costing him a total of $1,500. He thought the HOA should have footed the bill, so he sued. The basis for the suit is in the post. The judge agreed, holding the HOA board liable for breach of contract.
But that was not the end of the matter. The HOA sent an email to residents saying that it strongly disagreed with the court’s ruling. And what the HOA said and the basis for their argument? See the post.
TAKEAWAY: Common elements, unit boundaries and maintenance responsibilities are set out in the Governing Documents (or state law) – know who is responsible for what in your condo/HOA and get help from a community association lawyer.
In the post on Thursday 2/29/2024, we asked: What if someone can’t pay ‘rather large’ condo or HOA special assessment? It is not uncommon for an association to adopt a large special assessment (described in the post) to get work done for which there is insufficient money in reserve. But some owners may have trouble paying the special assessment. What does the association do in those cases? Those owners who do not pay (their regular or) special assessments risk losing their home to foreclosure and having a personal money judgment against them. And there are more implications for those owners as laid out in the post. The assessments remain due even if the owner disagrees and is actively fighting them, and if not timely paid will pile up, along with collection expenses.
TAKEAWAY: Condo and homeowner associations have the means to enforce special assessments that are not paid – review the Governing Documents and applicable state law. There are many options, including foreclosure, so timely payment is the best option.
The post on Friday 3/1/2024 was about Form I-9 software: avoiding unlawful discrimination when selecting and using I-9 and E-Verify software systems. A recent employer fact sheet from the U.S. Department of Justice (DOJ) and U.S. Department of Homeland Security (DHS) provides guidance for avoiding unlawful discrimination and other violations when using private software products to complete Forms I-9 and E-Verify cases. That is important because employers must not use software products that violate Form I-9 and E-Verify requirements or involve system limitations that unlawfully discriminate among workers.
The fact sheet reminds employers to use and properly complete the current Form I-9. Systems must comply with requirements for electronic signatures and document storage including those noted in the post. Employers must ensure that any software allows employees to leave form fields blank if they are not required fields (such as Social Security numbers, if not required on E-Verify cases) and more as listed in the post.
Relative to E-Verify, employers must also comply with program requirements when using software interfaces. Employers must still ensure the things listed in the post when using E-Verify software programs/systems.
The fact sheet notes that an employer that uses private software products for Form I-9 or E-Verify compliance is prohibited from certain actions including completing the Form I-9 on an employee’s behalf unless the employer is helping an employee complete Section 1 as a preparer or translator; pre-populating employee information from other sources, providing auto-correct on employee inputs, or using predictive language for form completion; and the other items listed in the post.
The fact sheet also warns employers against using software products that do not provide technical support to workers; it also has training requirements as noted in the post.
TAKEAWAY: Software can help an employer meets its records obligations, but employers are responsible to ensure that the software is legally compliant.
Finally, in the post yesterday 3/2/2024, we learned the EEOC sues retirement community for firing 78-year-old receptionist. Let’s dive deeper. The EEOC alleged that the retirement community’s actions were age and disability discrimination. The general manager said it was a “business decision” based on a loss of confidence in the worker’s ability to do her job. Really? Covenant Woods Senior Living LLC and BrightSpace Senior Living allegedly fired the receptionist, who had worked for the company for 14 years without serious performance concerns, after asking her “how long she planned to continue to work, whether she needed to work, and whether she would like to spend her time traveling and seeing family instead of working.” But that’s not all – see the post. BrightSpace and Covenant Woods denied any wrongdoing.
The EEOC defines age discrimination as treating an employee unfavorably because of their age. The ADEA prohibits the actions listed in the post relative to someone who is 40 years of age or older. Similarly, the ADA prohibits employers from discriminating against workers with disabilities in various areas as listed in the post. The EEOC alleged that Covenant Woods violated both statutes by terminating a high-performing and long-tenured employee on the unfounded assumption that her age and medical condition would prevent her from doing her job.
TAKEAWAY: Let’s say it again: don’t take adverse action against an employee based on anything other than performance – it will be a costly error that consultation with an employment lawyer could help you avoid.
York, Pennsylvania 17403