The post on Sunday 12/11/2022 was about the US Dept. of Labor’s new independent contractor rule. Note that the deadline for comment has passed so keep your eyes out for the final rulemaking- and know how it affects you. This has been a long time coming … but the rule is supposed to help employers classify workers as employees or contractors for FLSA purposes. The rule is intended to be consistent with longstanding precedent, so employers should be familiar with it and have relied on it in the past. This new rule does away with the 2021 independent contractor rule (which is discussed in the post along with its factors) and replaces it with this new rule that uses a totality of the circumstances analysis wherein each factor carries the same weight and none of which is dispositive. The factors include the person’s opportunity for profit or loss depending on managerial skill, degree of permanence of the work relationship, and others listed in the post. Other things can also be considered if they tend to indicate whether the workers are in business for themselves. Note that the rule provides further analysis of the control factor (as described in the post) among other things.
TAKEAWAY: Know how to classify workers under both federal and applicable state law – consult an employment lawyer to be sure.
The post on Monday 12/12/2022 told us a judge rejects Walmart request for new trial after firing of employee with Down Syndrome. This is all within a disability discrimination suit in which a jury found in 2021 that Walmart wrongly fired Marlo Spaeth who had worked there for almost 16 years. Walmart said it is reviewing its options. Let’s go back a step … The jury found in favor of Spaeth, who had folded towels, tidied aisles and helped customers, on the basis noted in the post. The jury also ordered Walmart to pay more than $125 million – no typo there! – in damages. Sadly, the judge had to limit damages by law as noted in the post. But the judge also ordered additional relief in the way of back pay and more (as also described in the post). And what did the judge say when denying the request for a new trial? See the quote in the post. Spaeth’s sister said that the firing disrupted their lives and took away Spaeth’s sense of purpose (and led to medical issues as noted in the post). Going even further back in the case, it began when Walmart adopted a computerized scheduling system that changed Spaeth’s long-standing work shift. Her disability did not allow her to adjust to the new schedule (why not is noted in the post). So instead of adjusting Spaeth’s schedule and putting it back to what is used to be, Walmart fired her in July 2015. And when Walmart tried to assert that it did not know what her accommodation limitations were, Spaeth’s attorneys fired back (see the post and smile). Stay tuned to see what Walmart does next.
TAKEAWAY: the judicial system is not quick, but juries are part of the system and verdicts are hard to overturn on appeal.
The post on Tuesday 12/13/2022 was about a parking spot costs $179,000 and comes with a monthly HOA fee. Big cities often have limited parking, but wow, just wow. This is a guarded parking space near Fenway Park and you can see it while it waits for you. It has other plusses too – see the post. It is also now offered at a discounted price; it was originally listed for $199,900 and is not $20,000 off. But it comes with a monthly HOA fee and a yearly tax – the total for those is in the post. A bit of history on the space (which seems to have a life of its own) is in the post.
TAKEAWAY: HOA and condo fees and amenities take many forms … Know what is part of the unit and what is a (limited) common element in your association.
The post on Wednesday 12/14/2022 told us a Chester County restaurant ordered to pay close to $194k in back wages and damages. The US DOL sued a taqueria for back pay and damages owed to 68 employees and now the parties have settled. This concerns the time period February 2018 – January 2021 a Taqueria Morolean in Avondale. The DOL investi-gator found that there were incomplete time and payroll records and more as noted in the post. On top of the back wages, the restaurant will have to pay penalties (the amount is in the post) for FLSA overtime violations.
TAKEAWAY: Make sure to properly pay your employees, no matter the sector or industry; it is much less expensive to do it right the first time (and out of the public eye). Talk to an employment lawyer if you are unsure about OT implications.
In the post on Thursday 12/15/2022 we learned that evidence of sexual and racial harassment sends claims to trial. A federal appeals court allowed a Black employee to go forward with her claims of sexual and racial harassment (which she alleged created a hostile work environment). The court overruled a trial court decision that the incidents cited by the employee, including frequent comments of a sexual nature and more as noted in the post were insufficient to establish a hostile environment.
So let’s look at the factual and procedural background. In 2006, Ford was hired as a salesperson at Jackson National Life Insurance Company. She worked there for four years. She alleged that during her employment she was subjected to sexual and racial harassment sufficient to establish a hostile environment. She sued, but the trial court dismissed the harassment claims before trial. Ford appealed. The appeals court initially noted that for Ford to be able to proceed with her hostile-environment claims, she first had to show that the employer discriminated against her because of her race and/or sex and second, that the discrimination was sufficiently severe or pervasive that it altered the terms or conditions of her employment and created an abusive working environment. To prove severity or pervasiveness, an employee must subjectively and objectively perceive the harassment. What this means is described in the post. A court analyzes severity and pervasiveness by looking at the totality of the circumstances and considering factors including the frequency of the discriminatory conduct, its severity, and other things listed in the post. The court noted that a few isolated incidents of discriminatory conduct and juvenile or annoying behavior that is not uncommon in American workplaces are insufficient to support a claim for hostile work environment. (NOTE: This author warns that there are occasions where isolated incidents can meet the threshold, so be careful.)
In this case Ford cited an incident occurring at an offsite work party when one of the company’s vice presidents held a vodka bottle horizontally in his pelvic region, thrusted it at her, and told her to get on her knees. Ford said she was so humiliated that she left the party. She also alleged that she was repeatedly asked sexually explicit questions and that daily sexist remarks were made including those noted in the post. The appeals court said that with those facts a reasonable jury could find that the company maintained a work environment where harassment was sufficiently severe or pervasive so as to alter the terms or conditions of Ford’s employment and created an abusive working environment and it allowed the sexual harassment claim could proceed to trial.
The appeals court delved into whether the evidence was sufficiently pervasive and severe. The trial court had concluded that while Ford had introduced evidence that the conduct was sufficiently pervasive to create an actionable hostile work environment, she failed to show that the conduct was sufficiently severe to meet the hostile work environment test of altering the conditions of employment. The appeals court said that was an error and that proof of either severity or pervasiveness can serve as an independent ground to sustain a hostile work environment claim. Then the appeals court rejected the company’s claim that the fact that Ford continued to advance at the company meant the conditions of her employment were not adversely affected. The court said the law does not require an employee to show that the hostile work environ-ment seriously affected psychological well-being or that it tangibly impaired work performance. The criterion is not what a reasonable female employee is capable of enduring, but what is noted in the post as explained by the appeals court.
Ford also claimed that company managers called her and the other Black female employees derogatory names such as “bitches” and more noted in the post. She also claimed that a white woman used the “n-word” in front of her while telling a story. The trial court had ruled that this was all insufficient to allow the racial harassment claims to proceed to trial because she had not heard all of the derogatory comments, some of which were directed at other Black women, and that the woman using the slur was not acting with racial animus. The trial court said Ford had experienced isolated incidents of racial enmity or sporadic racial slurs insufficient to establish a triable issue of fact on a hostile work environment claim. The appeals court disagreed. It said that when viewing the totality of Ford’s evidence, including the names she was called and the use of the racial slur, “a reasonable jury could find that [the employee] experienced a severe or pervasive hostile work environment on account of her race.” And what specifically did the appeals court point to? See the post.
TAKEAWAY: Liability does not require severe or pervasive conduct. Further, racial slurs can contribute to a hostile work environment even if not directed at anyone in particular. Control your workplace.
The post on Friday 12/16/2022 told us a homeowner claims HOA knowingly caused flooding on her property. Shelly Acevedo filed suit against Holisher Association, Inc,, a homeowners’ association, for negligence, trespass and fraud. Acevedo alleges that in 2018 the HOA started a surface water drainage construction project near and on her property, that the project was negligently designed and constructed, and excess water flowed to and flooded her property. She says the HOA has ignored her requests to remedy the problem. But it’s not that simple. There are relevant facts that occurred prior to her purchase as described in the post (that play into one of the claims in the suit). Acevedo is seeking damages in excess of $50,000 and attorneys’ fees.
TAKEAWAY: Community associations (condominiums and homeowners’) often undertake construction projects as part of their maintenance or repair obligations, but sometimes they go awry. Know who is liable for what – contact a community association lawyer.
Finally, in the post yesterday 12/17/2022, we saw a Court clarifies what qualifies as similar jobs under Equal Pay Act. The appellate decision pay provide some defenses to an EPA claim, so both employers and employees should pay attention. Here Shelly Ann Lee filed a complaint alleging that her former employer, Belvac Production Machinery, Inc., paid her less as its controller than it did her predecessor, Paul DiTomasso. Lee claimed the pay disparity was because of her sex, in violation of Title VII and the EPA and on other grounds noted in the post. The federal trial court granted Belvac’s motion for summary judgment (dismissal without a trial) and Lee appealed.
What a plaintiff must show for an EPA claim is listed in the post. Here it meant Lee had to show that she and DiTomasso had “virtually identical jobs,” which is more than that they held the same title and had the same general responsibilities.
Then once an employee meets its initial burden (by showing the required factors), the burdens shift to the employer to show that the wage differential was justified by one of the statutory defenses (which are listed in the post). The appellate court agreed with the trial court that Lee and DiTomasso did not hold the same position and that he performed different duties than she did. But the court did not stop there. It then focused on whether Lee’s job required equal skill, effort, and responsibility as the job held by DiTomasso. The court’s analysis and ruling are in the post.
TAKEAWAY: defending against EPA claims are just another reason employers want to have up-to-date job descriptions. Help your employer lawyer help you.