Archive for the ‘Hiring and Firing’ Category

(I’ve taken about 11 months off from blogging. I’m back, baby.).

Most employers (of over 50 employees) know full well that they have to provide up to 12 weeks of leave under the FMLA and that you generally cannot terminate an employee who is on leave. But don’t assume that means you can terminate an employee who is not medically cleared to come back when her FMLA leave is exhausted. In some cases, doing so will lead to a large verdict in favor of the former employee, as was demonstrated by a recent case from the Massachusetts Supreme Judicial Court, Esler v. Sylvia-Reardon, 473 Mass. 775 (2016).

The following is from the SJC’s rendition of the possible facts most favorable to Ms. Esler, and I do not represent them as true (the hospital may have presented different alleged facts). Esler worked as a registered nurse in the acute hemodialysis department of MGH. She went out on FMLA leave in December 2008, although there was some hassle from her supervisor about her paperwork. Her doctor suggested that she engage in light exercise and pleasurable activities. So she went to New York City. Her supervisor accused her of “vacationing,” and sounded displeased. When Esler then said that she broke her wrist while ice skating, her supervisor allegedly said “I need to have you back here next week or I can’t hold your job.”

In spite of her supervisor’s alleged statements, to its credit, the hospital extended her FMLA leave past her statutory 12 weeks of leave. However, the hospital said that it could not accommodate her temporary lifting restriction (no lifting more than five pounds in left hand) and need to wear a splint. Esler was expected to return on February 15, 2009. She spoke to her supervisor on January 28th and reported that she was making good progress. Although there was no equipment that required lifting more than five pounds, Esler’s supervisor canceled an occupational health assessment that was part of the return to work process and put Esler on inactive status. The hospital stated that her job could not be accommodated with the restrictions. However, the hospital hired a replacement with less training, who could not have fully performed the job until at least April 6th, a date that was after the date that Esler would have had no medical restrictions.

Esler sued for retaliation, which is prohibited under the FMLA (and most other employment statutes). A jury returned a verdict in her favor of back wages consisting of $567,500 and front pay of $672,686. The judge overturned the front pay award, and this decision was upheld on appeal. The trial judge also overturned the backpay award, but this was reinstated on appeal (subject to further proceedings at the trial court). Because the case was filed in 2010, if the backpay award sticks, interest will add a staggering 75% and counting (12% per annum in Massachusetts), which I calculate to be $425,625. Liquidated damages equal to the back pay could also be awarded. With an award of attorneys’ fees and costs surely on the horizon, the total verdict could approach or exceed two million dollars, even with the front pay being overturned. Not to mention the Defendants’ own legal fees, which are surely sizable.

Takeaways

There are a few lessons for employers. First, if an employee takes FMLA leave, don’t assume that her FMLA rights end after 12 weeks. In fact, the FMLA provides “proscriptive provisions” to protect employees from retaliation after exercising substantive rights.

Second, an employer should take a realistic look at accommodations an employee needs. Although it appears that Esler did not file a disability discrimination claim, she could have. Employers should always consider whether continued leave or other accommodations are reasonable for an employee who has been out on FMLA leave. You should also be careful to not use the FMLA leave in any future employment decision, as that could be deemed retaliation.

Third, train your supervisors to not make comments that are hostile to protected FMLA leave.

Fourth, for God’s sake call your employment lawyer before firing an employee who went out on FMLA leave! A short phone call might save you from a $2 million mistake. If the facts were as Esler alleged, the decision to not accommodate her for a short time was foolhardy and reckless.

As always, the above is not legal advice, just general information.

By Adam P. Whitney, Esq. 617.338.7000

Every private employer in the Commonwealth must be aware of the new Massachusetts law on sick leave. From the employer that already provides paid sick leave, to the employer of a single employee, this new Statute, which will be codified at General Law Chapter 149, Sec. 148C, will affect everyone when it goes into effect on July 1, 2015. Employees will be allowed to start taking sick leave on September 29, 2015 or 90 days after their start date if hired after July 1, 2015.

Ignore the Statute at your peril, as the result could be a claim against your company for triple damages and attorneys’ fees, or an enforcement action by the Attorney General, even if you already provide paid sick leave.

For Employers Under 11 Employees

The good news is that you do not have to provide paid sick time. After July 1st of next year, however, you will have to allow all employees to earn up to 40 hours of unpaid sick leave a year. This includes part-time and temporary employees. No one is excluded.

For Employers with 11 Employees or More

After July 1st of next year, all employees will earn up to 40 hours of paid sick leave a year. Even if you already provide such paid sick leave, your policy will likely need some tweaking because (1) the statutory sick leave is likely broader than your policy, and (2) your certification requirements might be more stringent than allowed under the Statute.

Part-time and temporary employees count towards the 11 employee threshold. The Statute is silent about what happens if you downsize in the middle of the calendar year from 11 employees to 10 employees or less. My best guess would be that employees would not lose sick time that was already accrued, but that they would stop accruing sick time when you downsized. Hopefully, the Attorney General will address this issue before the statute takes effect.

If you have more than 50 employees, you will have to coordinate this leave with the FMLA and the Massachusetts Small Necessities Leave Ace.

How Sick Leave Is Earned?

All employees will earn sick leave at the rate of 1 hour for every 30 hours worked, up to a maximum required 40 hours. Most full-time employees will earn the full 40 hours. Exempt employees paid on salary will normally be presumed to work 40 hours per week. Part-time workers might not earn the full 40 hours, but they may not need to. Sick time must be earned starting with the first day of work, although you need not allow any leave until after 90 days.

For What Can Sick Leave Be Taken?

This is where your current policy may be in conflict with the new statute. Under the new statute, an employee will have a right to take sick leave to care for a child, spouse or parent or parent of a spouse, including to attend the employee’s or family member’s medical appointment. Sick leave is also available for mental illness or preventive medical care. Sick leave may also be used to address the psychological, physical or legal effects of domestic violence, which could include going to court. The term “sick leave” could be a misnomer in many circumstances.

To make matters worse, sick leave can be taken in hourly increments (or smaller, depending on your policy for tracking time). On one hand, this makes sense because sick leave can be taken for a routine medical appointment. On the other hand, it may create a “get out of jail free” card for employees who simply over sleep and are late. The employee could claim that he or she felt ill and take an hour of sick leave. Theoretically, an employee could show up an hour late once a week, claim sickness, and be protected from punishment.

What About a Doctor’s Note Requirement?

This is another issue that may conflict with your current policy. The statute states that an employer “may require certification” when an employee takes more than 24 consecutive hours of earned sick time. A fair reading of this provision is that an employer may not otherwise ask for certification. So if an employee takes 2.5 days of sick time leave, the employer is apparently supposed to just take the employee’s word for it. The employer may not require that the certification explain the nature of the illness or the details of the domestic violence. Even where certification is required, the employer cannot delay providing the leave or paying for the leave on the basis that it has not yet received the certification.

What Penalties Are Available Under the Statute?

Employers are prohibited from interfering with an employee’s rights under the statute, or using the fact that an employee took earned leave as a negative factor in any employment action or otherwise disciplining the employee for using earned sick time. Employers are also prohibited from retaliating against any employee who opposes practices which the employee believes is in violation of the statute or supports another employee’s exercise of his rights under the statute.

The Statute will be enforced by the Massachusetts Attorney General, which has not yet issued any regulations or Advisory. The Attorney General can get an injunction against any employer violating the statute. Penalties, including potential criminal prosecution are available to the Attorney General. Additionally, the Statute has been incorporated into General Law Chapter 149, Section 150, which provides for a private right of action for triple damages and attorneys’ fees. It is not expressly clear if an employee would be entitled to recover for lost backpay in the event of a wrongful termination, or, if so, if the backpay would be tripled.

Other Statutory Provisions.

An employer is not required to pay out unused sick time upon separation of employment. This could get tricky if you combine a policy with paid time off or vacation pay.

Employees can carry over unused, earned sick time from year to year, but may not use more than the maximum 40 hours per year (unless the employer allows).

Employees must give notice if the need for leave is foreseeable.

Employees can make up the sick time by working another shift during the same pay period or the next pay period if both employer and employee agree. In that situation, the employer need not pay for the missed time, and the employee does not need to use earned sick time.

However, an employer cannot require an employee to work additional hours to make up the missed time, or require that the employee to search for or find a replacement employee to cover the hours during which the employee uses earned sick time.

Employers will be required to post notice of the rights under the statute.

Observations

The new Statute will impact all employers, some much more than others. The economic impact is potentially huge. If you have 100 employees earning an average of $40,000 per year, this new Statute potentially just added $80,000 to your yearly expenses, or $80,000 in lost productivity depending on how you look at it. Given the breadth of the statute and the anti-retaliation provisions, there will be little reason for any employee to not use his five days of sick leave a year. The likely result is that some employers will be forced to cut down on paid vacation and personal days. Sick leave will become the new personal day/vacation leave for many employers. In fact, the statute states that if you provide paid time off that meets the same parameters as the statute, you don’t need to provide additional sick time.

Worse yet, the statute arguably prevents an employer from rewarding attendance, as it could be deemed to be a de facto punishment to employees who took leave.

Problem employees will find a lot of room to abuse this statute. Virtually every termination becomes actionable by employees because virtually every employee will have taken sick time in the recent past. It will be the worst employees who will abuse the new law. The result will be that firing these worst employees will become risky. Employers who terminate unreliable or chronically late employees who are adept at gaming the system will risk exposure.

Employers will need to make (sometimes expensive) contingency plans to cover for sick workers. No longer can an employer place the responsibility on the employee to find someone to cover the shift. This will be a big change for some industries, such as the restaurant industry. It is not clear whether an employer can require an employee who is going to use a few hours of leave to be out for the entire shift. Although the statute does not expressly prevent this, it could be considered retaliatory and subject the employer to suit under the statute. The statute arguably requires employers to allow employees to take a few hours off and then show up and work their shift. Some jobs do lend themselves to allowing an employee to take a few hours off, such as a driver, a home health worker, etc. Some employers will face additional costs by being over-staffed to account for being under-staffed (keep in mind that if a replacement employee must report to work, they must be paid at least three hours).

Virtually every term in the statute is defined broadly in favor of the employee, so employers will have to err on the side of caution. For example, a “parent” includes any “person who assumed the responsibilities of parenthood when the employee or employee’s spouse was a child.” Another example is that leave is allowed for “preventive medical care.” Could this include acupuncture? Massage? Dental cleanings? Leave is allowed for medical conditions and mental illness,” so employees who are depressed, have anxiety, or sleep disorders are likely allowed to take leave.

Employers will have the additional burden of calculating sick time earned, especially for part-time, temporary or new employees. You may want to consider simply providing your full time workers the full 40 hours at the beginning of each calendar year, although this creates the possibility that the employee could use days that are not earned.

Be careful about paying people as independent contractors. This is very risky in Massachusetts anyway. Curiously, the sick leave Statute does not use the statutory definition for employee, but simply defines an employee for private employers as “any person who performs services for an employer for wage, remuneration, or other compensation.” Presumably, the Attorney General and the Courts will use the definition contained in the previous section of the Statute, General Law Chapter 149, Section 148B, which is also strict, but which does provide a working definition to distinguish between employees and independent contractors.

As always, the above is not considered legal advice, but is general information only.

By Adam P. Whitney

I greatly admire employees who are able to work while battling a life threatening disease like cancer. Employers also face difficulties when they learn that one of their employees has cancer, albeit not as great as the employee’s struggles. If you are an employer of any size, sooner or later you will face these issues. The private employers whom I have counseled are, of course, very sympathetic. Most will bend over backwards to help their employee, often to the detriment of everyday operations.

Employers often wonder what they can and what they should do in these situations. Is the employee qualified to work? Do we have to give the employee time off? How much? Does it have to be paid? What do we do if the employee’s performance is slipping? Do we have to allow work from home? Do we have a right to obtain medical information? Can we replace the employee temporarily? Permanently? What if the employee does not want to come back to work? Do we have to provide severance? Do we have to pay the employee’s medical insurance?

The answers to all of these questions is beyond the scope of this article, and will vary according to the law of your jurisdiction and, as to federal law, the number of employees you have. What you should not do is make any negative assumptions about a person with cancer. That’s what this employer appeared to do: http://www.huffingtonpost.com/2014/09/11/woman-laid-off-cancer_n_5806194.html. It now appears that the employer is facing a public relations backlash, and potentially serious legal ramifications.

Under Massachusetts law, if you have six or more employees, you are subject to the provisions of state law comparable to the Americans with Disabilities Act (which currently applies when you have 15 or more employees). Generally speaking, under both laws, you cannot simply terminate someone because they are disabled or facing a disabling disease, or because you think that they are disabled. There may be protections under other laws as well.

If these laws apply, you have an obligation to consider reasonable accommodations, including a leave of absence. That does not necessarily mean that you have to provide a leave of absence, especially a lengthy or open-ended one. Each situation is different, and must be separately evaluated. What you also should not do is to automatically terminate an employee after 12 weeks of FMLA leave, which some employers have learned the hard way. You may also have to consider work at home, and intermittent time off for treatment, as well as other accommodations.

The above being said, you still have the right to operate your business. You owe it to your business and your other employees to set clear standards of conduct and performance and to hold employees accountable. Cancer does not discriminate. It strikes the best employees, and it strikes employees who are not the best. Some employees will want to come to work everyday, if possible. Others will, understandably, want to focus their energies on their treatment and their family. As an employer, you will have to carefully consider how to strike a balance between accommodating the employee, and not harming your business. I wish I could tell you that this was easy, but it’s not. But if you face it head on like other business challenges and seek sound advice, you can get through it.

By Adam P. Whitney

 

This sounds crazy, but hear me out. I’ve seen many private businesses suffer because they have excessive dead weight, or worse, on the staff. These people may be your good friends. If you work together in smaller private company, it is inevitable that you will become friendly with and deeply care about your employees. You may even have people working for you who are related by blood or marriage. You feel trapped and that you cannot fire such people.

It’s extremely hard, I know. But you are running a business. Act like Bill Belichick and take the emotion out of personnel decisions. If David in outside sales wasn’t your buddy from college, would it make sense to keep him employed when your business shifted focused to inside sales? Ask yourself another way. If David quit tomorrow, would you replace him? If you say “no,” you know the right thing to do. Even if you would replace his position, would you replace him with a carbon copy, or are you pretty sure you would do a lot better. That makes it an even tougher call, but if David is incompetent, he’s hurting your bottom line every day.

I’m not trying to sound like the grim reaper of employment law, but you should assess all of your employees at least once a year. Don’t fire people just because you think you could do a little better (if you are sure you could do a lot better, that’s different). You may be wrong about that, and you will destroy morale. But each position should make economic sense to your bottom line. If you keep an employee who should be terminated just because they are your friend, both your company and your friendship will ultimately suffer. You will inevitably be bitter toward that employee, even if it is subconscious, and start treating them differently. Things could get ugly on both sides. “Good deeds” never go unpunished in my world.

Isn’t it better to be up front with people and explain the economic realities of their position and the company? Most employees take being fired personally, but you have some control over that. Along with a real explanation, give them fair notice and whatever they need to transition to their next position. Consider giving some severance. Consider transferring them to another position or modifying their current position. But don’t keep your son-in-law on as a V.P. if he’s not earning his keep. You would be better off just gifting the money and not making other employees bitter. Believe me, employees know who the favorites are; they also know who the deadweight is, and they will definitely be bitter about it. They will respect you – maybe even applaud you – for making the tough/right decision.

By Adam P. Whitney

 

I written before about how an employer can be damned when supervisors have sex with employees: https://damnedif.com/category/sexual-harassment/.

 

But being obsessed and pursuing a relationship can be just as damning. Take the recently-reported case at the Massachusetts Commission Against Discrimination (“MCAD”) MCAD v. Illumina Media. The employer is on the hook (subject to potential appeals) for a sizable award because, the MCAD found, one of the company’s owners made repeated sexual advances to a female employee, even though she repeatedly rejected them. This was the case even though, the MCAD found, the female employee actively participated in a sexually charged workplace atmosphere, where sexual innuendo and horseplay were commonplace and people looked at pornographic images on the internet.

 

The case reads like a made-for-TV movie of the week. The female employee started at Illumina as a 24 year old. According the case report, the company owner was at first friendly, but soon started to make comments about his sexual prowess with much younger women, and then suggested that he and the victim were “on a date.” The employee thought that these comments were strange and inappropriate, and would often reply that “it’s not happening” or “it will never happen.” Undaunted, the owner continued his pursuit, according to the report, and escalated the behaviors by explicitly asking for sex on a number of occasions, which the employee refused. The actions went downhill from there, according to the report. You can find a link to the decision here: http://www.mass.gov/mcad/documents/MCAD%20&%20Brooke%20Anido%20vs%20Illumina%20Media%20LLC%20dba%20Illumina%20Records%20&%20Ronald%20Bellanti.pdf

 

It does not appear that Illumina strongly or effectively contested that the owner aggressively pursued a sexual relationship with the employee. The MCAD Hearing Officer found Illumina and the owner liable for quid quo pro sexual harassment (generally thought of as conditioning a job or employee benefits on succumbing to sexual advances) as well as for constructive discharge. The MCAD reasoned that by treating the employee differently after she rejected the owner’s sexual harassment, Illumina could be held liable for quid quo pro sexual harassment. The decision was upheld after an appeal to the Full Commission of the MCAD.

 

Illumina and the owner were ordered to pay $75,000 in emotional distress damages and nearly $10,000 in lost wages. These two figures are subject to 12% interest from the date of filing the Complaint, which was a staggering six years prior to the decision of the Full Commission. Thus, interest will run at about 71%, adding $60,000 to this figure. The defendants are also liable for the employee’s legal fees and costs of over $62,000. Assuming that Illumina spent a similar amount on legal fees, the total out of pocket for the company appears to be at least $270,000, barring any further appeal.

 

While the facts here appear to be fairly egregious, the case should serve as a warning to all employers. Owners and managers, as human beings, will inevitably be attracted to subordinate employees. If you are a company of any significant size, there is no doubt that there are such attractions occurring right now at your business. You need to train all of your managers on how to deal with these issues (a subject for another post), or you could be on the hook for $270,000 or much, much more. Mangers and owners can easily fall into the trap of thinking that a loose environment means that anything goes in the workplace. But this case proves that such thinking can lead to big trouble.

 

By Adam P. Whitney

 

The case of Kogut v. The Coca-Cola Company, Massachusetts Commission Against Discrimination, No. 08-SEM-01239 (2012) demonstrates that even the biggest of companies, with professional H.R. (and the best lawyers defending them at trial) can make costly mistakes with respect to disability discrimination in Massachusetts.  This is undoubtedly the most complex area of law and it is easy to make a mistake.  For one thing, you will be held to a reasonableness standard, which means that you can act completely in good faith, but someone else gets to determine if you acted reasonably.

In this case, the complainant worked in the Coca-Cola plant in Northampton, Massachusetts through a temp. agency.  The employee was blind in one eye, but that did not prevent him from performing his job duties.  When a permanent position came up, Coca-Cola gave the employee a conditional offer of employment, subject to a medical examination.

When Coca-Cola learned of his visual disability, it revoked the conditional offer of employment.  It’s reasoning was that driving a forklift was part of the permanent position, and it had a legitimate safety concern with a visually disabled person driving a forklift.

Not so fast, said the MCAD.  It noted that for the particular job at issue, a Level 3 Operator, there was no reference to forklift use or operation in the “Physical Demands Analysis” or Job Descriptions, although the Level 1 Operator position did list “operate lift trick” among the essential job functions.  There appeared to be some confusion from some Coca-Cola managers as to which job position the Complainant applied for, but the MCAD clearly found that he applied for a Level 3 position, which did not require forklift operation.

The MCAD further found that, “even if forklift driving would have been required of the Complainant on occasion, . . . Respondent could have determined that, given the number of other available and certified drivers on Complainant’s shift, he could be excused from driving a forklift altogether as a reasonable accommodation.”

It appears that Coca-Cola’s mistake was that, according to the MCAD ruling, “its HR and medical safety consultants never met with Complainant or his direct supervisors at the plant to identify and evaluate the actual position for which he was being hired or to discuss possible accommodations, if required.”  Coca-Cola probably could have saved itself with the “interactive process” that it was required to do.  Had it done so, it would surely have discovered its errors, or alternatively it would have a record that the complainant could not have performed the essential job duties.  But simply relying on job descriptions did not go far enough to either meet its obligations or to protect itself from liability.

If you have a job candidate with a disability, carefully consider your legal obligations.  If you need help figuring this out, call me at 617.338-7000

By Adam P. Whitney

Jujitsu (actually spelled “jujutsu”) is a martial art where one uses the opponent’s force against himself rather than confronting it with one’s own force.  This is what employment lawyers are doing when they set you up for the Retaliation Trap.

The Retaliation Trap is simple in concept, but usually takes considerable skill and knowledge to set effectively.  It works best on arrogant, unwary employers with an intemperate owner or supervisor, especially if not represented by competent legal counsel.  It works like this.  An employee is having some trouble at work.  The employee senses that his or her days are numbered.  The employer is papering the file and gearing up for termination.  The employee visits a lawyer to see what can be done.

There is almost no direct force to stop a termination.  Employers always have the power to fire an employee, even where they don’t have a right.  That power, however, can be reversed to cause a self-inflicted wound.  The clever employee’s lawyer in the above situation will look for some colorable legal claim that the employee may have, and have the employee file some sort of complaint or charge.  The Retaliation Trap is set.  If the employer springs the trap by firing the employee, the employee may have a good claim for retaliation.  Believe it or not, this is true even if the original complaint was without merit. At least in Massachusetts, as long as the employee had a good faith belief in the complaint or charge, you are liable for full damages if you retaliate against the employee who filed the complaint or charge.

A recent appeals court decision, with a huge verdict (even after an 80% remittitur for the emotional distress damages), shows a significant self-inflicted wound when springing the Retaliation Trap. The case is reported as Trainor v. HEI Hospitality, LLC, 669 F.3d 19 (1st Cir. 2012).  According to the reported facts, the plaintiff and his lawyer were negotiating ongoing employment terms with the defendant, including whether the plaintiff would be relocated to an inconvenient location.  When the negotiations began to deteriorate, which could have resulted in either the end of the plaintiff’s employment or other unfavorable terms, the plaintiff’s lawyer filed a Charge of Discrimination based on age with the Massachusetts Commission Against Discrimination (“MCAD”).  He promptly forwarded a copy to the apparently hotheaded executive of the defendant (good move, he put them on notice).  The trap was set.

The executive fired the plaintiff three hours after receiving the Charge of Discrimination.  Not surprisingly, the jury found for the plaintiff on the retaliation claim, even though it rejected the age discrimination claim.  Other than cutting down some of the damages (the jury awarded $1,000,000 in emotional distress damages, the Court cut it down to $200,000, or a re-trial), the Appeals Court affirmed the verdict.  The jury and the Court also awarded $500,000 in back pay, $750,000 in front pay, and $550,000 in attorneys’ fees and costs.  The first three figures were doubled upon a finding of an intentional violation of the statute.  The rash firing appears to have cost the employer about $4 million, not to mention its own attorneys’ fees and costs.

In my estimation, jurors will punish you if they think you abused your power and retaliated against someone who made a complaint, even where the underlying claim cannot be proven.  The $1,000,000 emotional distress damages award could be seen as de facto punitive damages.  The Trainor makes it clear that where there are different versions of the facts, it is wholly the jury’s prerogative to decide for one side or the other.  This unfortunately means that every time you fire someone who has complained of discrimination, or some other claim (there are many different types of statutes that punish retaliation), you run the risk that a jury will think you retaliated.  Even if you didn’t and you planned to fire the employee anyway.

If you need help avoiding the Retaliation Trap, call me at 617.338.7000.

By Adam P. Whitney