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Monthly Archives: January 2010

Derogatory and Vulgar Language Can Create a Hostile Work Environment, Even if Not Directed at a Particular Employee

Posted by Philip B. Phillips on Posted in Discrimination, Retaliation and Harassment

In Reeves v. C.H. Robinson Worldwide, Inc., (11th Circuit, January 20, 2010), the employee, who worked as a transportation sales representative in a shipping company, claimed that she was subjected to a hostile work environment in violation of Title VII. Although not directed at or referring to the employee, she overheard her male co-workers refer to other women as “bitch,” “f***ing bitch,” “f***ing whore,” “crack whore,” and the “c” word. The employee’s co-workers also frequently turned the office radio to a crude morning show which regularly discussed offensive topics, such as women’s anatomy and the size of women’s breast. One co-worker, on one occasion, displayed a pornographic image of a woman on his computer screen. The employee claimed that this type of conduct occurred on a daily basis and that she frequently complained to no avail.

The trial court initially threw out the lawsuit, finding that the offensive conduct was not motivated by the employee’s sex because it was not directed at her in particular and was used in the presence of all employees, both male and female. The Federal Court of Appeals, however, reversed the dismissal of the case. The Court noted that although Title VII is not a general civility code, and that not all profane or sexual language or conduct constitutes discrimination,“a member of a protected group cannot be forced to endure pervasive, derogatory conduct and references that are gender-specific in the workplace, just because the workplace may be otherwise rife with generally indiscriminate vulgar conduct.” The Court also noted that a woman does not relinquish her right to be free from sexual harassment just because she chooses to work in a male-dominated trade.

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Amendment to Defense Spending Bill Restricts Use of Employee Arbitration Agreements

Posted by Larry S. Perlman on Posted in New and Recent Legislation

It has become increasingly common for employers to require employees to agree to mandatory arbitration of any employment-related disputes. Among some of the advantages, arbitration can be less costly than litigation and avoids the potential risk of exceedingly large jury damages awards. A recently signed bill, however, gives some employers who rely on arbitration clauses reason to pause.

On December 19, 2009, President Obama signed the 2010 Defense Appropriation Bill into law. This bill does more than dole out funds to the Department of Defense. The measure includes an amendment submitted by Senator Al Franken that prohibits Department of Defense contractors with qualifying contracts from requiring their employees to arbitrate Title VII claims and torts "related to or arising out of sexual assault or harassment."

Specifically, the “Franken Amendment” provides that any employer with a defense contract worth more than $1,000,000 must agree not to:

  1. require any employee to agree to mandatory arbitration of any claim under Title VII or any tort related to or arising out of sexual assault or harassment as a condition of employment; or
  2. take any action to enforce any provision of an existing agreement with an employee or independent contractor that requires mandatory arbitration of Title VII claims or torts related to sexual assault or harassment.

The new legislation does not appear to prohibit an employee from voluntarily agreeing to arbitrate a claim, nor does it appear to apply to mandatory arbitration of certain types of claims, such as wage and hour or contract disputes. Nonetheless, the bill’s language makes it clear that the prohibition on arbitration is broad. For one thing, this prohibition applies to all of a contractor’s employees, not just those who work on defense projects. Additionally, another section of the Franken Amendment requires contractors to certify that as of June 10, 2010, their subcontractors have agreed to the arbitration restrictions with respect to work related to the covered subcontract, thus ensuring that the effects of this bill will be felt beyond only those employers who directly contract with the Department of Defense.

All Defense contractors and companies that do business with Defense contractors should immediately review their policies and arbitration agreements, if any, to ensure compliance with the Franken Amendment.

Short-Term Pain, Long-Term Gain

Posted by Thomas C. Pence on Posted in Discipline and Termination

It is very common for human resources to encourage management to write honest performance reviews, and/or to utilize a performance plan, before terminating a long-term employee based on poor performance. We encourage management to utilize these tools primarily because it is the right thing to do from a values perspective – an employee should be given adequate notice of deficiencies and an opportunity to correct the deficiencies before termination becomes necessary.

It is also helpful to tell management, however, that there are good economic reasons to utilize performance reviews and performance plans. In a wrongful termination case, if a judge or jury finds there was unlawful discrimination, an employer’s liability can often reach $1 million. An employer’s chances of winning a wrongful termination case – and avoiding the $1 million liability – go up dramatically if it can show the employee was "warned" about poor performance on a performance review, or through a performance plan. Under that circumstance, a jury will be far more likely to think the employer was "fair," and therefore, that it did not wrongfully terminate the employee.

So, if you are encouraging a manager to write an honest review, or to consider a performance plan, and the manager argues that the business simply cannot afford to keep the employee on the payroll while it undertakes those actions, ask the manager which cost is higher – the cost of keeping the employee on the payroll while you go through performance counseling, or the cost of losing a lawsuit because you were not "fair" to the employee.

Updated COBRA Model Notices Available

Posted by Jonathan W. Oliff on Posted in New and Recent Legislation

The American Recovery and Reinvestment Act of 2009 (“ARRA”) provides for premium reductions for health benefits under COBRA. Eligible individuals pay only 35 percent of their COBRA premiums, and the remaining 65 percent is reimbursed to the coverage provider through a tax credit. As we previously reported to you, this COBRA continuation assistance was extended for two months until February 28, 2010. The maximum period for receiving the subsidy was also increased an additional six months, from nine to fifteen months.

In order to qualify, individuals must experience a COBRA-qualifying event that is the involuntary termination of a covered employee’s employment. An employee’s involuntary termination must occur during the period that began September 1, 2008, and ends on February 28, 2010. The premium reduction is applicable for periods of health coverage that began on or after February 17, 2009, and lasts for up to 15 months.

Individuals who experience a qualifying event after December 19, 2009, must receive an updated General Notice within the normal timeframes for providing a COBRA election notice. The Department of Labor’s updated model General Notice includes information on the premium reduction as well as information required in a COBRA election notice. Certain individuals who have already been provided a COBRA election notice that did not include information about the recent ARRA amendment must also receive a Premium Assistance Extension Notice. The Department of Labor has recently made its model General Notice and other notices available at: http://www.dol.gov/ebsa/COBRAmodelnotice.html.