President Obama Signs Bill Extending COBRA Subsidy

Mon, 15 Mar 2010 01:12:55 GMT

On March 2, 2010, President Obama signed the Temporary Extension Act of 2010 into law. This bill, which applies retroactively, extended the COBRA subsidy for individuals who lose group health coverage due to an involuntary termination that occurs up to and including March 31,...

Immigration Reform Bill Might Call for Biometric Identification Cards

Sun, 14 Mar 2010 13:58:18 GMT

The Wall Street Journal reports that a mandatory biometric identification card for U.S. citizens and legal residents could be included in a comprehensive immigration reform bill being spearheaded by Senators Charles Schumer (D-NY) and Lindsey Graham (R-SC). The card would contain standard identifying information, but would also contain a biometric identifier, e.g., fingerprints. Schumer has previously proposed such a card to replace E-Verify, the federal electronic employment verification system. Continue reading at Littler's Global Immigration Counsel blog.

Photo credit: David Franklin

How Broad is the Ninth Circuit's Woody Woo Decision?

Sat, 13 Mar 2010 20:34:43 GMT

The Ninth Circuit Court of Appeals recently ruled that the FLSA does not restrict employer-mandated tip-pooling arrangements when no tip credit is taken by the employer against the minimum wage obligation. Cumbie v. Woody Woo, Inc., et al., No. 08-35718 (9th Cir. Feb. 23, 2010). Further, the Court rejected the DOL’s regulation at 29 C.F.R. § 531.35, and held that the employees in Woody Woo had no legal right under the FLSA to retain all of their tips, except where the tip credit is taken by their employer.

In Woody Woo, all tips received by the restaurant went into a “tip pool”, the proceeds from which were redistributed to all employees, including the kitchen staff, who (it is universally understood) are not “customarily tipped” for the purposes of the FLSA in the restaurant industry. Importantly, all employees received an hourly wage that complied with both federal and Oregon minimum wage laws: again (it can’t be said enough), no tip credit was taken.

Based on this decision, in states where state wage-and-hour laws track the FLSA (or states with no applicable state wage law), especially those within the Ninth Circuit, employers may want to consider tip pooling arrangement similar to the one addressed by Woody Woo. Where the FLSA is the only statute at issue, Woody Woo stands for the proposition that, provided all employees receive the federal minimum wage (currently $7.25/hour), tips can be collected and redistributed to the entire labor pool, or even potentially kept by management, without violating the FLSA.

However, in many states, state wage and hour laws expressly prohibit the construct Woody Woo authorizes. In New York, for example, tip pooling and tip distribution is limited to voluntary pooling among employees who “customarily” receive tips and an employer or its agent cannot retain any tips. N.Y. Labor Law § 196-d.

Finally, even in states with no state law restrictions, common law theories of contract, quantum meruit or unjust enrichment (which are part of most states’ common laws), or statutory theories under consumer protection or business practices statutes can be utilized by employees to attack tip distribution arrangements where any tips are siphoned away from employees engaged in direct service. This concern is underscored if the customer is not explicitly advised that non-service personnel may receive a portion of tips.

Further discussion of this decision can be found on www.JacksonLewis.com by clicking here.

A few facts on Traumatic Brain Injury (TBI)

Sat, 13 Mar 2010 11:46:08 GMT

Millions of people in the United States suffer from some sort of traumatic brain injury (TBI), also referred to as a closed head injury, and may not even know it. TBI’s occur when the brain is subject to trauma. It is medically accepted that a person can suffer from a TBI even if not “knocked out” at the scene of an accident, do not suffer a skull fracture, and even if all diagnostic imaging tests are normal. TBI’s affect the way the brain processes information. The person suffering from a TBI may not be the best historian of their symptoms, and may not even believe they have an injury. Family and friends are usually in a better position to detect the signs and symptoms of TBI, as they are the ones that can see an objective change in the person’s behavior.

Some facts of a Traumatic Brain Injury (TBI):

A person does not need to be “knocked out” or unconscious to have sustained a TBI.
The ability to walk and talk at the scene of an accident does not rule out the possibility of a TBI.
The ability to drive home after an accident does not rule out the possibility of a TBI.
The fact a person is not diagnosed with a brain injury in the hospital, does not rule out the possibility of a TBI.
The fact there are normal neurological examinations, normal CT scans, X-rays or MRI’s, does not rule out the possibility of a TBI.

The main leading signs or symptoms of a Traumatic Brain Injury are: Headaches; memory problems; concentration and attention problems; personality change; difficulty organizing tasks; fatigue; inability to fall asleep or remain asleep; balance and stability problems; irritability, anger, frustration; speech and communication problems with the inability to find the right words to express yourself; depression.

If you observe any of the above noted signs or symptoms in a friend or loved one, it’s possible they are suffering from a Traumatic Brain Injury. It is important they seek immediate medical attention to correctly diagnosis if it is a Traumatic Brain Injury, and to get proper medical care and treatment..

Resources for Survivors of Traumatic Brain Injury

Brain Injury Association of America - National Website for the Brain Injury Association that promotes educational awareness, support, legislation and resources on brain injury
Brain Injury Association of Florida - Website for the state office with updates and resource information for survivors, caregivers, prevention and legislative updates
Brain Injury Association of America - State Offices - A contact list for 44 state offices
Florida Brain and Spinal Cord Injury Program - The Brain and Spinal Cord Injury Program (BSCIP) is administered by the Florida Department of Health.
Florida Institute for Neurologic Rehabilitation, Inc - In Patient services for Brain Injury Patients.

New Mobile Phones Capable of Monitoring Employee's Every Move?

Sat, 13 Mar 2010 05:19:39 GMT

New mobile phone technology may allow employers to track very precise movements and activities of employees, such as walking, climbing stairs or even cleaning. As reported by Michael Fitzpatrick of BBC News, the technology developed by KDDI Corporation, a Japanese company, “works by analyzing the movement of accelerometers, found in many handsets.” This enhanced level of monitoring likely will raise serious concerns for courts seeking to balance an employer’s legitimate need to monitor employees with an employee’s expectation of privacy.

To get a sense of how sensitive this technology is, Mr. Fitzpatrick notes that a KDDI mobile phone

strapped to a cleaning worker's waist can tell the difference between actions performed such as scrubbing, sweeping, walking and even emptying a rubbish bin.

Employers should proceed with caution. There certainly are legitimate business reasons for gathering and analyzing this kind of data:

Improving customer service
Enhancing employee productivity
Identifying safety concerns and rectifying them
Ensuring employees are performing only assigned tasks
Confirming employees are working when they say that they are

At the same time, significant concerns about the technology and how it is implemented, together with the potential for unintended consequences, should motivate employers to think carefully before using this equipment:

Does the technology really work as advertised?
Can employees manipulate the “accelerometers,” creating false positives for employers?
When should/must employers turn the monitoring off?
Will effects will data capable of showing the time, date and duration of certain activities have in the areas of wage and hour law, collective bargaining, classification of workers as employees versus independent contractors, workers’ compensation, administration of leaves of absence, and so on?
Will data collected constitute personal information to be safeguarded and retained?
Will employers be required to produce information collected through these mobile phones in unrelated litigation, such as where an employee’s spouse seeking to prove claims of adultery in a divorce action seeks “phone” records to show the location and activity of the employee-spouse?
Some states already have laws dealing with electronic monitoring, but it is unclear how those laws will apply to this new technology. For example, a Connecticut statute prohibits employers from recording or monitoring the activities of employees in areas designed for the health or personal comfort of the employees or for safeguarding of their possessions, such as rest rooms, locker rooms or lounges operating. When Connecticut employers perform permissible electronic monitoring on their premises, they must provide employees with prior written notice.

However, if these phones work as intended, the level of intrusiveness likely will spur opposition by privacy advocates and additional legislation. It also is possible that the U.S. Supreme Court’s decision in City of Ontario, Ontario Police Department, and Lloyd Scharf v. Jeff Quon, et al., currently before the Court, will provide guidance for employers and lower courts as they consider the effects new technologies have on workplace privacy issues. In that case, one issue the Court is considering is whether a California police department violated the privacy of one of its officers when it read the personal text messages on his department issued pager.

There is no doubt technology will continue to advance and bring with it enhanced functionality and capabilities. While the law will try to keep pace, employers will be challenged to apply these technologies in ways that meet the demands of their business, while avoiding the pitfalls of law not yet clearly established.

Should Toyota face criminal penalties?

Sat, 13 Mar 2010 02:29:47 GMT

How can Toyota have actual knowledge of their cars sticky accelerators, give wrong information to the United States National Highway Traffic Safety Administration, and NOT face criminal penalty?

Presently there is a Federal Grand Jury proceeding in New York, which is investigating the “timeliness of Toyota’s reporting of its sudden-acceleration complaints and fixes.” I am betting that the United States Attorney will open an investigation soon for criminal penalties against the company. Many innocent victims have died because Toyota hid the truth about safety issues.

Human lives are not to be counted on an actuarial chart and compared to the financial impact on a company before making a known defect public. When you are producing a dangerous product and putting it in the stream of commerce, you must correct know defects; otherwise, you are acting with reckless abandon in harming human life.

The very definition of manslaughter is the unlawful killing of a human being without premeditation or intent through gross negligence. The difference between this and actual murder is that murder requires actual malicious intent. Former Toytota counsel Dimitrios Biller said that Toyota had systematically disregarded the law. He said to CNN that the material he had reviewed was “very, very disturbing.” Toyota continues to fight the litigation requests to review their most important documents. They are also not permitting their old lawyer to say what he knows.

Hopefully, the public will not feel bad for Toyota because tough minded trial attorneys want to hold Toyota accountable for their reckless conduct.

Should Toyota face criminal penalties for witholding information from the NHTSA?

Sat, 13 Mar 2010 02:29:47 GMT

How can Toyota have actual knowledge of their cars sticky accelerators, give wrong information to the United States National Highway Traffic Safety Administration, and NOT face criminal penalty?

Hopefully, the public will not feel bad for Toyota because tough minded trial attorneys want to hold Toyota accountable for their reckless conduct.

The Ninth Circuit Issues Subsequent Opinion on Commuting Time and Off-the-Clock Issues

Fri, 12 Mar 2010 23:50:10 GMT

The Ninth Circuit recently re-issued an opinion that illustrates the many work-time issues raised when employees commute between home and service sites in company vehicles. Rutti v. Lojack Corporation (9th Cir., No. 07-56599, Mar. 2, 2010). The court affirmed its initial, important finding that an employer can make commuting in a company vehicle a condition of employment without affecting the compensability of the commute time under federal law. The court divided sharply as to whether the commute time would be work time under California law, given the requirement that employees go directly to and from service sites without undertaking any personal tasks along the way.

California has no specific exclusion of commute time from work time similar to the federal Employee Commuter Flexibility Act (ECFA), and the California courts have, so far, focused on how much control an employer exercises over travel time. Whether the plaintiff’s commute time is work time under state law will be resolved on remand to the district court. The court of appeals affirmed its initial finding that small amounts of time spent in the morning working out the route for the day were not compensable work time either because the time was incidental to the commute and, therefore by definition not work time, or was so de minimis as to not be considered to be work time.

The court was again divided as to whether the time spent in the evening uploading a record of the day’s service activities was de minimis. That issue will also be resolved by the district court on remand in consideration of the amount of time spent in the activity, the difficulty of recording the time, and the cumulative amount of time involved in the activity. While the court did not resolve whether the uploading time was work time, the court did affirm its important finding that the uploading activity, which could take place at any time in the evening, would not turn the commute from the last service location to home, into work time. In this regard, the court rejected the plaintiff’s argument that the commute home from the last service location was part of a continuous work day and therefore work time because the commute was travel from a location where service work was performed to a site where uploading work was performed.

This entry was written by Brian Dixon and Gina Chang.

Crouching Tiger: Franchise Regulators Pounce on Franchisors

Fri, 12 Mar 2010 21:39:38 GMT

The following article appeared in the March/April, 2010 issue of Business Law Today.

Click here to view article

Is it fair to punish employers for violating laws that no one understands?

Fri, 12 Mar 2010 21:25:54 GMT

One of the greatest challenges facing California employers is determining when hourly employees are properly on or off the clock. This is especially true when employees don’t perform their work in a centralized location where they can clock in and out. A decision last week out of the Ninth Circuit – Rutti v. Lojack Corp. – illustrates the difficulty employers face.

Rutti worked for Lojack installing car alarms. He was paid on an hourly basis starting when he arrived at his first job location and ending when he completed the last installation of the day. But in a class action lawsuit he filed, Rutti argued that his workday extended beyond those times.

According to Rutti, his workday began when he was at home receiving his daily assignments, prioritizing the jobs, and planning his route. He argued that his workday continued as he drove to the first assignment (in a company vehicle he was required to use and in which he was prohibited from running personal errands or giving rides). He also alleged that, after his last job, he was entitled to be paid as he commuted home in the company vehicle (subject to the same restrictions) and, when he got home, as he logged onto the company's computer system to transmit data regarding the work performed that day.

The district court judge granted summary judgment, ruling that Lojack had paid Rutti properly. Rutti appealed. Last August the appellate court issued an opinion, which it subsequently withdrew. It issued a new opinion on March 2, 2010.

In this latest version, two of the appellate judges (Callahan and Silverman) decided that the time spent transmitting information at the end of the workday may be compensable and reversed that portion of the lower court's ruling. Judge Silverman also wrote a separate opinion elaborating on state law issues that the third judge (Hall) joined in, but from which Callahan dissented. Hall also wrote an opinion (concurring in part and dissenting in part) explaining why the data transmission time should not be compensable. And Judge Callahan wrote a separate opinion (concurring in part and dissenting in part) explaining why she disagreed with Hall and Silverman's state law analysis.

So in answering the question whether applicable law required an employer to pay an employee for specific tasks, three judges issued four separate opinions. Is it any wonder that employers in California are confused about their wage and hour obligations? Employers who fail to apply these laws properly face huge monetary penalties. How is that fair if no one seems to understand precisely what these laws require?

Why lawyers must keep silent

Fri, 12 Mar 2010 19:09:19 GMT

Sunday night, 60 Minutes aired a report on an innocent man who was in jail for 26-years while two lawyers refused to disclose evidence that he was innocent. (Read it here.) The general theory of the story was that the lawyers should have said something, but "felt they had no choice". Unfortunately, the story did not properly explain why the lawyers had no choice.

In Ontario, all lawyers are governed by the Law Society of Upper Canada's Rules of Professional Conduct. Rule 2.03(1) reads:

A lawyer at all times shall hold in strict confidence all information concerning the business and affairs of the client acquired in the course of the professional relationship and shall not divulge any such information unless expressly or impliedly authorized by the client or required by law to do so.

If you follow this link to Rule 2, you can find an official commentary by scrolling down. The basic idea is that clients need to be able to trust their lawyers. If a client has to worry that admitting guilt to a lawyer will result in the lawyer telling the police, then clients will withhold such evidence and lawyers will not be able to do their jobs properly.

Some might argue that would be a good thing. Why should guilty people be protected from the truth? For one thing, you have to consider that if you change the rule, then clients will no longer tell their lawyers the truth. As a result, the truth will still remain hidden. The only difference would be that lawyers might go to court believing their clients to be innocent when they are not really innocent. Some guilty people will benefit from that while others will not. Ultimately, we are unlikely to have any more "truth" in the system.

However, if you get beyond theory and consider the specifics of this case, you have to wonder why an innocent man should lose 26-years of his life for a matter of legal principle. Our system is based on the theory that we would rather let 10 guilty people go free than jail one innocent person; we do not believe that we should let 10 guilty people go free and jail one innocent person.

At the same time, you have to wonder what value there would be to the lawyers disclosing the confession. Perhaps their client was just boasting and did not actually do it. Perhaps he was hoping to get a deal for telling the truth. Perhaps he was friends with the accused man and wanted to help him. That is unlikely since the man did not allow his lawyers to disclose the confession, but if they had disclosed it 26-years ago then those sorts of theories would have been considered in weighing the evidence. Ultimately, the lawyers would have discredited their own ability to maintain the confidence of their clients while gaining little for the innocent man.

Many people do not understand the ethical obligation of lawyers. Our job is to represent our clients to the best of our ability and allow the court system to decide guilt and innocence. We have this obligation because our society believes that individuals have the right to defend themselves to the best of their ability. When an innocent man goes to jail because two lawyers did not disclose confidential evidence, you should not blame the lawyers. Instead, you should look at the rules that govern the lawyers and decide whether they are justified.

What is a libel notice?

Fri, 12 Mar 2010 19:08:22 GMT

On Monday, March 3, Prime Minister Stephen Harper sent the leader of the opposition, Stéphane Dion, a "libel notice". (Story here) (Libel notice here [PDF]) Libel is when one person, a publisher, damages the reputation of another person, the complainant, in a newspaper...

On Monday, March 3, Prime Minister Stephen Harper sent the leader of the opposition, Stéphane Dion, a "libel notice". (Story here) (Libel notice here [PDF])

Libel is when one person, a publisher, damages the reputation of another person, the complainant, in a newspaper or a "broadcast". Broadcasts include television, radio and Internet.

In Ontario, claims of libel are governed by the Libel and Slander Act. To sue a publisher for libel, you need to tell that person in writing that you believe you have been libelled. That is the "libel notice", and it must be sent within six weeks of the potentially libellous statement.

This is an important stage in any claim for libel, because it gives both parties a chance to come to a settlement. Once a publisher receives a libel notice, that person can immediately publish a retraction. Online, the publisher can even amend the original comment or delete it all together. This helps both parties, because it minimizes the damage to the complainant's reputation and minimizes the damages that the publisher might have to pay if the complaint is valid.

The libel notice also gives some advantage to the publisher. If the publisher is convinced that there was no libel, then the publisher can report on the threat of a lawsuit. In some cases, this can make the complainant seem like he or she has something to hide. In other cases, the increased rhetoric may force the complainant to drop the matter so that the libel lawsuit does not spread the story even further.

In Stephen Harper's case, it probably made sense to send libel notice immediately if he truly believes that he was libelled. This is because the attacks of the Official Opposition are unlikely to go unreported. Mr. Harper had to attempt to protect his reputation as soon as possible.

However, in many cases people believe that they have been libelled by bloggers. If nobody has read the blogger's website, then it might not be worth sending a libel notice. As soon as the blogger publishes the notice, it becomes much more likely for media to pick up on the story. In such cases, the complainant must consider very carefully whether it is worth the risk of sending a libel notice. Normally, it will make more sense to phone the person first and ask for a retraction before sending anything official.

If it were not for libel notices, then there would be far more libel cases in court. The costs would be much higher and the damages could become excessive. However, without libel notices the complainant would have an advantage over the publisher. Since libel is, at its heart, about punishing people for writing their opinions, that publisher's advantage probably makes sense.

Avoiding the Toyota Crash

Fri, 12 Mar 2010 18:41:04 GMT

The debacle of Toyota continues to play out in the media. Today, the embattled car manufacturer once touted as the most successful in the world, is the subject of U.S. government safety investigations and numerous court cases. Toyota owners are suing over the loss of value of their vehicles and families are suing over the tragic loss of at last count 34 lives, involved in crashes attributed to unexplained acceleration problems. You don’t need a crystal ball to predict Toyota stands to lose billions of dollars, or that the global impact on the manufacturer will continue for years to come.

How could this have happened to the car manufacturer? Didn’t they develop their own “lean” manufacturing and production process which has been adopted by other corporate giants trying to emulate Toyota’s success? Didn’t Toyota have a book written about their corporate climb to success called The Toyota Way, which details the 14 management principles that drove them to the top of the heap of automobile manufacturers?

Despite developing corporate principles covering philosophy, people, process, and problems, Toyota fostered a culture that prevented reporting of the acceleration malfunctions. Toyota’s fall from grace can’t be attributed to just one thing. Instead it should be viewed as a series of events including:

poor supplier control,
lack of leadership,
employing too many “yes” people,
failing to see an automobile as the sum of its parts,
human resources problems,
procrastination, etc.

Intervention at a variety of individual points in the chain of events could have prevented this corporate train wreck. Unfortunately, in the words of an old Japanese saying, “The nail that stands out was not encouraged to be different, but instead it was pounded down to conform.”

Solis Discusses Plans for Worker Misclassification, Enforcement Initiatives During Committee Hearing

Fri, 12 Mar 2010 15:58:09 GMT

Testifying before a House subcommittee hearing on Wednesday, Labor Secretary Hilda Solis explained (pdf) how the agency would use the $116.5 billion in proposed funds and 17,800 full-time equivalent employees outlined in the DOL’s fiscal year 2011 budget. These plans include a broad employee misclassification initiative to deter employers from wrongly categorizing employees as independent contractors, among other enforcement efforts. The hearing was conducted by the House Appropriations Committee’s Subcommittee on Labor, Health and Human Services, Education and Related Agencies, which is tasked with reviewing $17.1 billion of the DOL’s proposed budget.

Solis stated that $1.7 billion in discretionary funds and 10,957 full-time equivalent employees would be devoted to worker protection activities, including an employee misclassification initiative. This initiative would use $25 million to create a multi-agency program to strengthen and coordinate federal and state efforts to enforce statutory prohibitions on misclassification, and identify and deter instances of employee misclassification as independent contractors. The DOL’s Wage and Hour Division (WHD) would receive $12 million and 90 new investigators to expand these enforcement efforts. In addition, the misclassification initiative would support new, targeted efforts to recoup unpaid payroll taxes through state audits of problem industries supported by federal audits, and by means of a $10.9 million pilot program that would reward the states that are the most successful or improved at detecting and prosecuting employers that fail to pay the appropriate taxes due to worker misclassification. The budget would also allocate $1.6 million to the Office of the Solicitor to hire 10 full-time equivalent employees and enhance enforcement strategies; provide $150 thousand to the Occupational Safety and Health Administration (OSHA) to train inspectors on worker misclassification issues; and promote legislative changes that would require employers to properly classify their workers, impose penalties for noncompliance, and provide employee protections in the event employees are wrongly categorized as independent contractors.

In addition to the worker misclassification initiative, Solis explained that the budget request of $244.2 million for the WHD would support targeted investigations, compliance assistance, and the reduction of repeat violations of minimum wage, overtime, and workplace safety laws. The Office of Federal Contract Compliance Programs (OFCCP) would receive $113.4 million and 788 full-time equivalent employees, which would, according to Solis, “allow OFCCP to broaden its enforcement efforts and focus on identifying and resolving both individual and systemic discrimination.” Pursuant to the OFCCP’s enforcement of Executive Order 11246, Equal Employment Opportunity, the agency plans to renew its focus on conducting reviews of the construction industry.

With respect to workplace safety, Solis said her request of $573.1 million and 2,360 full-time equivalent employees for OSHA would redirect 35 such employees from compliance assistance to enforcement. In addition, the budget includes an additional request of $4 million to expand OSHA’s regulatory program, $1 million for consultation programs focused on small businesses, and $1.5 million for state plans.

The Secretary’s testimony reflects the shift in focus and resources towards enforcement activity by the DOL. With an enhanced emphasis on enforcement, employers can expect greater scrutiny of their practices by the Department.

Brain Injury Awareness Day - March 17, 2010 - Capitol Hill

Fri, 12 Mar 2010 15:45:07 GMT

"Approximately 1.4 million Americans experience Traumatic Brain Injury (TBI) each year and an estimated 3.2 million Americans are living with long-term, severe disabilities as a result of brain injury. Another 360,000 men and women are estimated to have been inflicted by a TBI in the conflicts in Iraq and Afghanistan. The national cost of TBI is estimated to be $60 billion annually."

Congressman Bill Pascarell - NJ (Co- Chair Congressional Brain Injury Task Force)

Brain Injury Awareness Day on Capitol Hill will take place Wednesday, March 17, 2010.

The event is being hosted by the Congressional Brain Injury Task Force.

The Brain Injury Association of America encourages advocates across the country to participate in the Brain Injury Awareness Day. Below is a schedule of the day’s events:

Brain Injury Awareness Fair
10:00 AM - 1:00 PM - First Floor Foyer of the Rayburn House Office Building

Brain Injury Briefing
2:30 PM - 4:00 PM “From the Playground to the Pros: A Heads-Up on Concussion” Capitol Visitors Center - Congressional Meeting Room South

Reception Celebrating Brain Injury Awareness Month
5:30 PM - 7:30 PM -First Floor Foyer of the Rayburn House Office Building

Click on the following link for more information on Brain Injury Awareness Day on Capitol Hill - March 17th

Employee Handbooks Need to Change

Fri, 12 Mar 2010 15:36:20 GMT

Mike Maslanka, generally a defense lawyer, offers a good point about employee handbooks. All large employers have them. They provide concise, easy-to-read rules. But, employee handbooks generally do not provide a purpose for the rule. They do not explain why a particular rule is necessary, or even better, why the rule provides a benefit to the employee. For example, every handbook explains that the employee is at-will and and can quit anytime. That means, the employer can terminate the employee at any time. Mike suggests employers explain how that benefits both parties. One could, for example, insert a sentence explaining that this flexibility allows either party to seize available opportunities. A handbook could also explain the rules regarding hostile work environment ensure that the best employees are allowed to be productive.

In the US Army, we called this process "task plus purpose." Every mission should provide the purpose of a particular mission to a soldier. If you explain the purpose of a particular task or mission, you provide that soldier the flexibility to react to changing circumstances. For example, do not just tell a captain his men must seize a particular objective. Tell him his troops must secure an objective in support of another attack. That way, if the objective is secured before the captain gets there, he will know that he should react by supporting the attack in some other way. This sort of flexibility allows nimble reaction to a fluid situation. He will not have to wait until he can call the general on the radio to obtain new guidance.

But, this flexibility also incorporates the Captain into the overall strategy. He is not just a cog, but an integral part of the plan. If you bring the Captain and his troops into the overall battle plane, they will treat it as their own plan. Any employee needs to feel part of the overall strategy. They need to buy into the overall plan, not just their small part of it.

But, the disconnect in this scenario is that some employers do not want the employees to feel they have a voice in company strategy. Some employers believe that in giving employees a voice in how to sell product or how best to fabricate machinery, they may seek a voice in other areas, as well. If so, that view is short-sighted.

Americans are generally independent. We will follow orders or direction but we want to know why. Our military forces for 200 years have always needed some degree of explanation before following direction. The new generation, the so-called "millenial" generation, seeks this understanding even more so. An employer who ignores these facets of our national character does so to their detriment.

$2 Million Dollar Consent Decree Against Tire Chain - What Lessons Learned for Employers?

dewestlind@stoel.com (Dennis Westlind) — Fri, 12 Mar 2010 15:33:31 GMT

Earlier this week, a federal judge approved a $2 million consent decree, finally settling an Equal Employment Opportunity Commission (EEOC) suit alleging that the Les Schwab Tire Center violated Title VII by discriminating against women in its 420 stores in California, Idaho, Montana, Nevada, Oregon, Utah, and Washington. Click here to download a copy of the EEOC v. Les Schwab Consent Decree.

The consent decree comes out of a lawsuit filed by the EEOC alleging that Les Schwab had a pattern and practice of hiring men for sales and service positions (such as tire changers and brake and alignment techs), while hiring women for less-desirable administrative positions. The EEOC also alleged that promotions to store management positions were only made from the male-dominated ranks of the sales and service employees. The $2 million will be shared by an estimated 200 women who filed applications for sales and service positions and were turned down by the tire chain. Les Schwab also agreed to make its best efforts to hire women into service and sales positions in proportion to their availability in the qualified applicant pool, affirm its commitment to equal employment opportunity, achieve a diverse workforce, review its recruiting and hiring procedures, and train its employees on equal employment opportunity issues.

The Les Schwab case illustrates a difficult reality that many employers face: certain industries are, for various non-discriminatory reasons, dominated by employees of one sex. While that is not necessarily proof of sex discrimination, the EEOC (and plaintiff's lawyers) absolutely look at such industries very, very carefully for signs of discrimination. Employers in such industries can take steps to ensure that they don't become the next target of an EEOC lawsuit, including:

Review application statistics to ensure that women and men are hired in proportions roughly equal to the number of qualified female and male applicants
Review promotion statistics to ensure that women and men are promoted in proportions roughly equal to the number of qualified female and male employees
If employees appear to be segregated by sex into different jobs, investigate why this is and ensure that it is not for discriminatory reasons
Ensure that your EEO policies are up to date, appropriately posted, and understood by all employees
Provide EEO training to managers who make hiring decisions
Partner with trade schools and colleges to actively recruit members of the underrepresented sex
Review job descriptions to ensure that any physical requirements are job-related and necessary

California Legislator Proposes Bill to Clarify And Revise Class Action Procedures

callaborlaw@cdflaborlaw.com (Carlton DiSante & Freudenberger LLP) — Thu, 11 Mar 2010 22:16:42 GMT

By Kent Sprinkle

After witnessing the birth and maturation of the wage and hour class action industry, now entering its late teens, California employers justifiably wonder whether these enormously costly lawsuits will ever slow down. The answer is probably no, since the question of whether a class should be certified remains an unpredictable matter, and the current law does not provide any assurance that a trial court will decide the issue in a particular way. Under the current state of the law, trial courts have enormous discretion in whether to certify a class. Because of this, inconsistent results abound, notwithstanding almost identical factual and legal issues in cases with conflicting certification results. Employers frequently feel compelled to pay out large settlements just to avoid the risky unknowns of class certification, since settlement demands often skyrocket once a class has been certified and the plaintiffs' attorneys can assert the claims of an entire class, rather than just threaten the possibility of a certified class. Because so few class actions ever go to trial, judges remain free to declare class actions to be "manageable" even based on passing references to methodologies that are, as a practical matter, unproven, untried and often amount to pure speculation as to whether such methods would properly or effectively manage the issues in the case at trial. However, absent a clear set of rules to apply, employers are left to roll the dice on each trial court's view of the certification question under a highly discretionary standard. Presumably, only a change in the law - either legislatively or by groundbreaking precedent - can provide the much-needed clarification and predictability for such cases.

On February 10, 2010, California Assemblywoman Audra Strickland introduced a bill, ABX8 38, that proposes substantial revisions to California's class action procedures. Specifically, the bill "would create a comprehensive set of procedures to be followed in all class actions," and, among other things, "would establish the prerequisites for a class action and would prohibit the maintenance of a class action unless other criteria are met." The proposed statutory language states that "the lack of clear standards for certifying and managing class actions in California has led to abuses of the class action device," and that "these abuses have undermined public respect for our judicial system." The bill therefore proposes the implementation of "a uniform set of standards for the certification and management of all class actions in California that is modeled on Rule 23 of the Federal Rules of Civil Procedure and that will provide judges with adequate guidelines and tools for the fair and efficient oversight of class actions." Perhaps most significantly, the bill proposes that the legislature explicitly "eliminate any presumption or policy in favor of class certification and allow class certification only when all requirements set forth in this act are satisfied." On a practical level, the bill urges that its purpose is to rectify the economic harm caused by frivolous class action lawsuits, noting its purpose in seeking to "create jobs and promote a more robust economy by creating some guidelines for class action litigation." The proposed text asserts that "too often, frivolous lawsuits clog courts, harming businesses and consumers and draining California's economy" and that "the growing number of abusive cases has cost businesses millions of dollars." In an attempt to prevent such costly abuses, the bill endeavors to "provide a balanced and fair set of standards and rules for class action lawsuits."

Were this proposed bill enacted, California employers would surely be relieved even at the possibility of increased predictability and clarity with respect to class certification rulings. However, employers can expect aggressive opposition from trial lawyers' organizations and similarly interested groups who profit in the current climate of unpredictability and conflicting results. We will continue to monitor the status of this proposed legislation and will report on any developments.

Senate Approves Bill Extending COBRA, UI Benefits, Pension Relief Measures

Thu, 11 Mar 2010 19:45:36 GMT

On Wednesday, the Senate passed by a 62 to 36 margin the Tax Extender Act of 2009 (H.R. 4213), legislation that would extend until Dec. 31, 2010 the 65% premium COBRA subsidies and emergency unemployment insurance benefits, both programs that are set to expire in the coming weeks. The bill also extends several other tax credit initiatives, and includes pension funding relief measures. On Tuesday, the Senate voted 66-34 to limit debate on this bill, which was introduced by Sen. Max Baucus (D-MT) as an amendment (S. Amdt. 3336) in the nature of a substitute to the tax extender bill the House of Representatives passed in December.

In addition to extending the premium COBRA subsidy until the end of the year, the bill makes certain technical changes to the program itself. Specifically, the bill makes the following clarifications, among others:

Adds a new section clarifying special rules in the case of individuals losing COBRA coverage due to a reduction in hours;
Clarifies the period of assistance; and
Adds a provision stating that the government or the individual may bring a civil action to enforce applicable provisions of this law, and provides that the Secretary may assess a penalty of up to $110 per day against a plan sponsor or health insurance issuer for each violation.

The Senate also approved by voice vote an amendment (S. Amdt. 3430) to the bill that aims to encourage employers to continue their defined benefit pension programs by providing temporary relief from statutory pension funding obligations. According to a press release issued by Sen. Isakson (R-GA) – who introduced the amendment with Sen. Ben Cardin (D-MD) – the amendment would provide employers with two options “to spread out” their pension obligations:

Under the first option, employers would be able to repay their pension shortfall over seven years, but the seven-year amortization would start two years late. During the two-year delay period, the employer would only owe interest on the shortfall. Under the second option, employers would be able to pay back their pension shortfall over 15 years.

Employers electing to avail themselves of the “two and seven”, or 15-year relief plans would be required to abide by the “cash flow rule,” under which an employer must make an extra “matching” contribution equal to the amount by which any of its employees’ taxable compensation exceeds $1 million. An employer would also be required to contribute an amount equal to the “extraordinary dividends” paid during the year, and an amount equal to the aggregate fair market value of the “stock redeemed” during the year that exceeds the employer’s net income for accounting purposes.

Other pension funding relief measures are included in the bill, which, according to Sen. Baucus, are designed to provide temporary, targeted funding relief for single employer and multiemployer pension plans that suffered significant losses in asset value due to the 2008 market downturn.

The bill includes other tax credit measures, including an extension until Dec. 31, 2010 of an employer wage credit for employees who are active duty members of the uniformed services. This extension would provide eligible small business employers with a credit against income tax liability for a taxable year in an amount equal to 20 percent of the sum of differential wage payments to activated military reservists, up to $4,000, and be applicable to payments made after December 31, 2009. Other program extensions include one that provides a tax credit for employers of qualified employees that work or live on or near an Indian reservation, and an extension of the Work Opportunity Tax Credit (WOTC) for qualifying employers that hire employees in the areas hit hardest by Hurricane Katrina.

The measure will now need to be reconciled with the House bill and undergo a second round of approval before it can be signed into law.

Miami-Dade County Enacts New Wage Theft Law

Thu, 11 Mar 2010 19:13:16 GMT

The County of Miami-Dade in Florida recently enacted a "Wage Theft " ordinance which makes it a crime for an employer to "fail to pay any portion of wages due to an employee, according to the wage rate applicable to that employee, within a reasonable time from the date on which that employee performed the work for which those wages were compensation."

The law defines the term "reasonable time" to mean within 14 days, unless the employer and employee agree in a writing signed by the employee to extend the deadline for payment up to 30 days from the original date . Under the new law, employees owed $60 or more in wages may file a complaint with the county. The county will then serve the employer with notice of the claim and a hearing officer will determine the amount of past wages owed and assess liquidated damages equivalent to double the amount of past wages owed. The new law became effective on February 28, 2010.

This entry was written by Paula Steele.

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