Supreme Court Holds That Where Violation of First Amendment Rights at Issue, Employer Perception Rules

Posted by on May 12, 2016 in Retaliation, Supreme Court, Wrongful Termination

In a decision that may be particularly timely in this heated election season, the United States Supreme Court recently considered the issue of whether an employee who was demoted because the employer mistakenly believed he participated in political activity can file a lawsuit against the employer under 42 U.S.C. § 1983 for deprivation of his First Amendment rights under the U.S. Constitution. The facts of this case took place right here in our region in Paterson, New Jersey.

In Heffernan v. City of Paterson, 136 S.Ct. 1412 (2016), a police officer went to a political campaign site to pick up a lawn sign for a mayoral candidate, who was a friend of his, on behalf of his bedridden mother. The police officer had no involvement in the candidate’s campaign. The officer’s supervisor and the chief of police had been appointed by the candidate’s opponent, the incumbent mayor. His fellow officers spotted the officer at the campaign site, and word got back to his supervisors about it. The officer was demoted the very next day for his “over involvement” in the campaign of the mayoral candidate.

The officer filed a lawsuit under 42 U.S.C. § 1983 (which provides a cause of action for violations of constitutional rights) alleging that he was unlawfully demoted “because he had engaged in conduct that (on [the employer’s] mistaken view of the facts) constituted protected speech.” The Court observed, citing to Elrod v. Burns, 427 U.S. 347 (1976) and Branti v. Finkel, 445 U.S. 507 (1980), that “[w]ith a few exceptions, the Constitution prohibits a government employer from discharging or demoting an employee because the employee supports a particular political candidate.” However, the officer in this instance had just picked up a sign for his mother and was not actually engaging in political activity or supporting the candidate.

The question before Court in Heffernan was whether it is the employee’s actions, or instead the employer’s motivation in an employment decision, that determines whether an employee was deprived of a constitutional right. Put another way, does the analysis of whether the employee’s constitutional rights were violated by an employment decision focus on the employee’s conduct in engaging in protected activity, or is it instead focused on whether the employer believed (even mistakenly) that the employee was doing so?

The Court held in a 6-2 decision that whether the employee’s right was violated is determined by the employer’s motivation in the employment decision. In its decision, the Court looked to Waters v. Churchill, 511 U.S. 661 (1994), in which an employer terminated an employee when the employer believed the employee had engaged in speech that was not protected by the First Amendment, even though the employee’s speech was in fact protected. In Waters, the Court held that the employer did not violate the employee’s constitutional rights if it “(1) had reasonably believed that the employee’s conversation had involved personal matters, not matters of public concern, and (2) had dismissed the employee because of that mistaken belief.” The Court in Heffernan noted that the Waters decision focused on the perception of the employer, not the actions of the employee. The Court then stated:

“In Waters, the employer reasonably but mistakenly thought that the employee had not engaged in protected speech. Here the employer mistakenly thought that the employee had engaged in protected speech. If the employer’s motive (and in particular the facts as the employer reasonably understood them) is what mattered in Waters, why is the same not true here? After all, in the law, what is sauce for the goose is normally sauce for the gander.”

Notably, the Court also addressed whether its decision would increase the burden placed on employers to defend against claims, and held that a ruling that creates liability for an employer for a factual mistake does not place an increased burden on an employer. After all, the Court held, the employee still shoulders a heavy burden of showing the employer’s motive.

The case was then sent back to the lower court, who will hear, among other issues, if the employment decision was based on a policy prohibiting all officers from engagement in “overt involvement in any political campaign,” and if that policy was constitutional.

In light of the Heffernan decision, employers should be aware that they may not be able to defend adverse employment decisions where the employee’s engagement in protected speech is at issue merely by asserting that the employee was not actually engaged in protected speech. Their mistaken view will not relieve them of potential liability. Employers may wish to tread carefully when making an adverse employment decision and ensure that their investigatory procedure clearly documents that a decision was made as a result of unprotected speech by an employee or other just cause. As always, we advise that employers consult with an employment attorney prior to making adverse employment decisions.

The full text of the Heffernan decision can be found at: http://www.supremecourt.gov/opinions/15pdf/14-1280_k5fl.pdf.

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New Jersey Senate Fast Tracks Paid Sick Leave Bill

Posted by on Feb 24, 2016 in Benefits

Currently, there is no New Jersey state law requiring private sector employers to provide employees with paid or unpaid sick leave. However, the New Jersey State Senate has fast tracked legislation, Bill 799, to impose a mandatory sick leave requirement on private employers.  S-799 stipulates that all companies, regardless of size, would have to provide at least five, and as many as nine, sick days per year to all of their employees – even part-time workers.   More specifically, the Senate bill would require employers to grant workers an hour of paid sick leave for every 30 hours worked.  Workers at businesses with fewer than 10 employees would be able to accrue up to 40 hours of sick time that could be carried over from one year to the next.  Employers with 10 or more workers would be required to allow them to accrue and carry over up to 72 hours of sick leave.

At least nine municipalities in New Jersey already require some form of mandatory sick leave. For example, private employers within the city limits of Jersey City with 10 or more employees are required to provide up to 40 hours of paid sick leave per calendar year to eligible employees.

This debate in New Jersey is taking place amid a growing interest nationwide for paid sick leave, exemplified by an executive order issued by President Obama on Labor Day that requires federal contractors to provide employees with paid sick leave.

Employers should stay abreast of developments on this bill which, if passed, would require employers to rewrite their existing sick leave policies and perhaps rethink their vacation and other leave policies. Employers who operate in multiple states should also follow changes in local and state laws, as other jurisdictions and cities, Philadelphia, for example, have enacted paid sick leave laws which may affect out- of-state employers operating within their jurisdictional limits.  Hill Wallack employment law attorneys are available to help navigate paid sick leave laws and how they may affect clients in New Jersey, New York, and Pennsylvania.

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Recent Amendments to New York Law Provides More Protections to Women in the Workplace

Posted by on Feb 4, 2016 in Gender Discrimination, Pregnancy Discrimination, Sexual Harassment

On October 21, 2015, Governor Andrew Cuomo signed multiple pieces of legislation designed to protect and further women’s equality in the State of New York. While the new laws, which all went into effect on January 19, 2016, deal with a broad range of legal issues, including human trafficking and domestic violence, a substantial focus of the legislation was strengthening women’s rights in the workplace.

All of these changes are not merely cosmetic, or intended to codify prior court decisions. Rather, they represent significant substantive changes to New York employment law, and have substantially updated what many deemed to be outdated and incomplete protections for women in the workplace (though all of these changes, sans pregnancy, apply equally to men).

Should you have any questions or require further detail regarding this legislation, the employment and labor attorneys at Hill Wallack LLP are fully prepared to assist and help guide you through this sea of change.

Pay Equity- the first piece of legislation amended New York Labor Law s. 194, which addresses equal pay in the workplace. The bill eliminates a loophole in the prior law that allowed employers to prohibit employees from discussing their salaries (as well as the salaries of others) under the threat of termination or suspension. Specifically, the bill would allow employees to discuss their wages with each other. Further, the bill increases the amount of damages available to an employee if an employer willfully violates the law.

Sexual Harassment- another bill amends the New York State Human Rights Law (“NYSHRL”) to protect all employees from sexual harassment in the workplace regardless of the size of the employer. Previously, the definition of “employer” excluded employers with fewer than four employees, thus prohibiting individuals from filing harassment complaints with the Division of Human Rights against those employers. This new law expands the definition of “employer” to cover all employers within New York in sexual harassment cases so that an employee of any business, regardless of size, can file a workplace sexual harassment complaint.

Attorneys’ Fees- a further bill now allows successful plaintiffs to recover attorneys’ fees in employment discrimination cases based on sex. Under prior New York State law, plaintiffs could not recover attorney fees for employment discrimination cases, making it costly to bring a case.

Familial Status- an additional amendment to the NYSHRL prohibits employment discrimination based on familial status. Previously, New York State law only prohibited discrimination based on familial status in the areas of housing and credit, however, employees often suffer from stereotypes relative to their status as parents or guardians of children under the age of eighteen. It is believed that women have been disproportionately affected by stereotyped views of parents in the work place and are less likely to be recommended for hire or promoted.

Pregnancy Discrimination- a further amendment to the NYSHRL now requires employers to provide reasonable accommodations for pregnant employees (or those suffering from “pregnancy-related conditions”). Some pregnancies can result in medical conditions requiring certain accommodations within the workplace and prior protections for pregnant women were deemed confusing and subject to misinterpretation. This new law clarifies that employers must perform a reasonable accommodation analysis for pregnant employees. Essentially this amendment puts pregnant women, as well as those suffering from pregnancy-related conditions, on equal footing with disabled employees when it comes to requests for reasonable workplace accommodations.

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“BORGATA BABES” LOSE BID TO OVERTURN DISMISSAL OF SEX DISCRIMINATION AND HARASSMENT CLAIMS

Posted by on Sep 24, 2015 in Gender Discrimination, Sexual Harassment

The bid by a majority of a group of twenty-one (21) plaintiffs, all former employees of the Borgata Casino Hotel & Spa, to overturn the dismissal of their sex discrimination and sexual harassment claims was recently rejected by the Appellate Division. The plaintiffs were employed as “Borgata Babes,” a specialized group of costumed beverage servers on the Borgata casino floor. As “Borgata Babes,” the plaintiffs were subject to specific “personal appearance standards” (“PAS”) that governed the plaintiffs’ dress, appearance, weight and overall grooming. While the plaintiffs in this case were all female, the “Borgata Babes” also included men who were subject to a similar PAS.

The trial court dismissed the entirety of the plaintiffs’ claims on summary judgment, finding that the PAS did not constitute gender stereotyping nor did it have a disparate impact on the female employees. In an opinion published on September 17, 2015, the Appellate Division readily agreed with the trial court’s ruling. However, the Appellate Division did reverse the dismissal of those claims asserted by some of the plaintiffs that the weight policy set forth in the PAS was applied in a discriminatory harassing manner by unlawfully targeting female employees returning from maternity and medical leave. Those claims were remanded back to the trial court for further proceedings.

Given the hotly-contested nature of this litigation, it is highly likely that the plaintiffs will next ask the New Jersey Supreme Court to certify the matter for appeal. Moreover, given the attention this case has garnered in the media as well as the somewhat novel factual circumstances giving rise to the claims themselves, there is a decent chance of the Supreme Court granting certification and hearing the appeal.

We will continue to monitor the case as it progresses, as its novel, broad-ranging issues could have an impact on various employers, such as restaurants, hotels, professional sports franchises and adult-oriented businesses.

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NLRB Dismisses Northwestern University Football Players’ Union Election Petition

Posted by on Aug 19, 2015 in NLRB, School Law

By: Felicity S. Hanks, Esq. (fhanks@hillwallack.com)

In January 2014, football players at Northwestern University (“Northwestern”) filed a historic union election petition with the National Labor Relations Board (“NLRB”) seeking to unionize and claiming that they were university employees. We blogged about it last year and much has happened since that post, culminating in a surprising NLRB decision issued this month.

NLRB Regional Director Peter Sung Ohr acted on the players’ petition on March 26, 2014, and ruled that the football players were “employees” of Northwestern, primarily due to the football program’s commercial activity and profitability, in addition to the extraordinary levels of control that Northwestern and its coaches had over the players’ lives.[1] Northwestern appealed the decision to the NLRB. For the last several months, players, the NCAA, colleges, and labor practitioners alike have been awaiting the NLRB’s decision with interest, but some sport enthusiasts and labor watchers might say that the NLRB swallowed its whistle on this one.

In a unanimous decision, the NLRB declined to assert jurisdiction over the case and dismissed the football players’ petition.[2] In doing so, the NLRB avoided addressing the merits of Director Ohr’s decision concerning the players’ status as employees. The NLRB held that that exercising jurisdiction over this case would not promote labor stability due to the nature of the NCAA Division I Football Bowl Subdivision (“FBS”) in which Northwestern University participates. The majority of the schools in the FBS, unlike Northwestern, are public institutions not subject to the National Labor Relations Act (“NLRA”), and therefore a substantive decision on the players’ petition would create an unwanted piecemeal treatment of players within the league.

Importantly, by declining to exercise jurisdiction, the NLRB did not decide whether student-athletes in general, or at Northwestern in particular, have the ability to unionize as employees under the NLRA. The decision does not preclude student athletes at other institutions from attempting to organize under the NLRA or state-specific public employer labor relations laws. It is likely that the issue of athletes as employees will come up again in the not-so-distant future. As the question of whether one is an employee is so fact specific it is typically a case-by-case basis as to whether a class of individuals may be deemed employees. After this decision, however, we now know that if faced with this issue in the future, the NLRB will not limit its inquiry into the specific institution, but will consider implications on the league as a whole.

This article is for informational purposes only and does not constitute legal advice or a legal opinion. All employers should seek legal counsel when addressing matters related to its employees or unionization efforts.

[1] The Regional Director’s 3/26/14 decision can be accessed at: https://www.nlrb.gov/news-outreach/news-story/nlrb-director-region-13-issues-decision-northwestern-university-athletes

[2] The NLRB 8/17/15 decision can be accessed at: https://www.nlrb.gov/news-outreach/news-story/board-unanimously-decides-decline-jurisdiction-northwestern-case

 

 

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The U.S. Department of Labor Provides New Guidance to Determine When Workers May be Classified as “Independent Contractors”

Posted by on Aug 17, 2015 in FLSA

By: Susan Swatski, Esq. (sswatski@hillwallack.com) and Jessica Seiden, Summer Associate

As workplaces take on organizational restructuring, many employees become misclassified as independent contractors. This misclassification has significant impact on workers, particularly in low wage industries. When employees are wrongly characterized as independent contractors, they do not receive labor protection rights, such as minimum wage, overtime, unemployment, and worker’s compensation. The U.S. Department of Labor’s Wage and Hour Division recently provided additional guidance to aid employers in determining how to classify their workers.

An agreement between an employer and a worker designating the worker as an independent contractor is not indicative of the relationship and is not relevant to the status. The Fair Labor Standards Act (“FLSA”) applies a multi-factor “economic realities test” to determine whether a worker is an employee or an independent contractor. A worker who is dependent upon finding employment in the business of others is considered an “employee,” whereas a worker in business for him or herself is considered an “independent contractor.” The Administrator’s application of the “economic realities” test considers six independent factors, and no factor alone is sufficient to determine if a worker is “economically dependent” on the employer; all of the factors must be considered in each case.

The first factor to be considered is whether the work done is an “integral part of the employer’s business.” If the work performed is integral to the employer’s business, it is more likely the worker is economically dependent. Work can be integral even if it is performed away from the employer’s premises. The second factor is whether the “worker’s managerial skill affects the worker’s opportunity for profit or loss.” A worker in business for his or herself will typically have such an opportunity for profit. The focus is whether the worker exercises managerial skills and whether those skills affect the worker’s opportunity for both profit and loss. The third factor to be considered is “how the worker’s relative investment compares to the employer’s investment.” An independent contractor makes investments that support a business beyond one particular job. These investments must be significant to indicate the worker’s independence. Investing in tools and equipment is not necessarily a business investment or capital expenditure that indicates the worker is an independent contractor, because they may simply be required to perform the necessary work for the employer.

The fourth factor is whether “the work performed requires special skill and initiative.” Business skills, judgment, and initiative are more indicative of independent contractor status than technical skills that are used to perform the work. Even specialized skills do not indicate that workers are in the business for themselves. The fifth factor employers should consider is whether the “relationship between the worker and employer is permanent or indefinite.” Permanency suggests employment status, while working on a single project that is not continuous or repeating is more akin to an independent contractor. A lack of permanence with an employer is indicative of independent contractor status if it results from the worker’s own independent business initiative, rather than the operational characteristics of the industry. The sixth and final factor to be considered is the “nature and degree of the employer’s control.” A worker must maintain and exercise meaningful control of his or her work to be considered an independent contractor.

Under the FLSA’s broad definition of employ as “to suffer or permit to work,” most workers fall into the employee category. This expansive definition must be taken into account while applying the “economic realities” test to determine if a worker is truly an independent contractor. Taking into account the ultimate issue of whether the worker is in business for him or herself or economically dependent in the application of the “economic realities” test will prevent the detrimental outcomes of misclassification.

If your company hires independent contractors, you should consider having skilled employment counsel review those workers’ relationship with the company to ensure compliance with the FLSA.

 

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EMPLOYEE “SELF-HELP” REMOVAL OF CONFIDENTIAL DOCUMENTS TO SUPPORT A DISCRIMINATION CLAIM

Posted by on Aug 11, 2015 in Uncategorized

By: Susan L. Swatski, Esq. (sswatski@hillwallack.com) and Bryan A. Coe, Summer Associate (bcoe@hillwallack.com)

Employees seeking to support their employment discrimination litigation by removing confidential documents from their place of work should think again. That conduct, commonly referred to as “self-help” was recently dealt a blow in State v. Saavedra. Previously, in Quinlan v. Curtiss–Wright Corp., the New Jersey Supreme Court established a “totality of the circumstances” test for balancing an employee’s right to access and use documents during workplace discrimination litigation against an employer’s interest in protecting confidential documents. The New Jersey Supreme Court recently revisited the issue in State v. Saavedra, in which the court addressed whether an employee could face criminal charges for engaging in self-help to obtain confidential documents during civil litigation.

In State v. Saavedra, the employee removed documents from her employer, the North Bergen Board of Education, to assist in her employment discrimination claim. In response to a request from the employer to produce all confidential documents in her possession, the employee produced the documents which she removed from her employer. Upon learning of this, the employer notified the County Prosecutor, and the employee was indicted for third-degree theft by unlawful taking of public documents.

The employee argued that taking documents was allowed under the Quinlan “totality of the circumstances” test. In deciding the Saavedra case, the New Jersey Supreme Court, in a 6-1 decision, found that “nothing in Quinlan states or implies that the anti-discrimination policy of the Law Against Discrimination immunizes from prosecution an employee who takes his or her employer’s documents in use in a discrimination case.” However, the employee would be able to assert, during her criminal prosecution, that her intent was to use the documents in her discrimination litigation. The Supreme Court then articulated the following five factors for a jury to use when determining if an employee has a “claim of right” to use employer documents: (1) the contents of the documents; (2) the presence or absence of a confidentiality policy; (3) the privacy interest at stake; (4) the extent to which the employee disclosed the documents; and, (5) the employee’s reason for taking the documents instead of seeking them through discovery. This “claim of right” providesa defense to criminal charges, and the jury would weigh these factors to determine whether it was appropriate to remove the documents.

In the wake of the Saavedra decision, employers should make sure employees who handle confidential information sign a confidentiality or non-disclosure agreement. Having this signed agreement will weigh in an employer’s favor if an employee attempts to establish a “claim of right” during a civil proceeding. Additionally, the employee handbook should list how confidential documents should be handled and what the consequences of mishandling those documents are, including potential criminal prosecution.

If you are an employer, who regularly deals with confidential information, you should seek legal advice to determine whether your employment policies accurately protect you from an employee taking those documents from your possession to use in employment litigation.

 

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