EEOC Suffers Defeat in Ongoing Attack on Separation Agreements

The EEOC’s 2013-2016 Strategic Enforcement Plan identified as one of its top priorities the regulation of overly broad separation agreements that allegedly interfere with employees’ Title VII rights to file discrimination charges. Recently, the agency sued several employers for using what appear to be fairly standard separation agreements. The EEOC’s lawsuit against CVS, which has received the most attention, was dismissed last month when an Illinois federal court granted CVS's Motion for Summary Judgment on procedural grounds. Equal Employment Opportunity Commission v. CVS Pharmacy, Inc., No. 14-cv-863 (N.D.Ill.2014).  While this was a technical ruling, it bodes well for employers that this standard separation agreement was not invalidated, and in fact, the Court appeared to criticize the agency’s case on the merits. Nonetheless, we do not expect the EEOC to back off from its new aggressive position, and employers should conduct a careful review of their separation agreements.

The CVS case was closely followed by employers and employment law attorneys alike because the terms of CVS's Severance Agreement are commonly used in separation agreements, namely, a cooperation clause, a non-disparagement clause, a confidentiality requirement, and a release with a covenant not to sue. The EEOC argued that the agreement was overly broad, misleading, and unenforceable because it interfered with an employee’s right to file a charge, even though the agreement provided that it did not prohibit the employee from participating in an investigation by a federal, state, or local agency that enforces discrimination laws. This disclaimer language is routinely included in separation agreements, and was previously deemed enforceable by the EEOC.  As such, many employers’ separation agreements were put in jeopardy by this case. If these terms were declared unenforceable, the incentive for most employers to pay employees monetary settlements in exchange for a release of claims and an agreement to not sue would be lost. In view of this dismissal of the EEOC's lawsuit, this will not be the case—for now.

The Court did not reach the issue of whether or not the terms of CVS's Severance Agreement are enforceable.  Instead, the lawsuit was dismissed on the ground that the EEOC did not fulfill the administrative prerequisite of attempting to conciliate with CVS before filing the suit.  Still, the judge added footnotes, that although not binding authority, seemingly do not bode well for the EEOC’s position. The judge noted the disclaimer to CVS’s general release language, the passage protecting the individual’s right to participate in agency proceedings, and reasoned that the language plainly encompasses the employee’s right to file an EEOC charge.

Notwithstanding the procedural defeat in this case, the EEOC has indicated that it continues to hold to its position, and may appeal the dismissal to the 7th Circuit. Looking ahead, we will wait and see what happens with the EEOC’s lawsuit in Denver against College America for its use of a severance agreement that also has non-disparagement as a condition for paying severance, and required that employees represent that they have no pending claims, including administrative actions, against the company. Ironically, the employee at issue in the College America case filed three EEOC charges after she signed the purportedly restrictive agreement. In the meantime, it is more important than ever for employers to have a well-crafted and comprehensive separation agreement that will withstand challenge.

Sara Dajani is an associate attorney with Berenzweig Leonard, LLP. She can be reached at sdajani@berenzweiglaw.com.

Can You Fire An Employee for A Facebook “Like”?

Since the arrival of social media sites such as Facebook and Twitter, employers have worried about protecting themselves from disparaging comments by their employees. Meanwhile, the National Labor Relations Board (NLRB) has intensified its scrutiny of employers’ social media policies and whether such policies prohibit employees from discussing the terms and conditions of their employment. The National Labor Relations Act (NLRA) gives employees the right to act together “to improve terms and conditions of employment or otherwise improve their lot as employees,” and social media has become one of the main avenues through which employees do so. An employer who violates this right and disciplines or fires an employee for engaging in protected activity faces big penalties, including having to reinstate the employee.

In a series of rulings over the past few years, the NLRB has taken the position that social media sites are “virtual water coolers,” and whatever employees have a right to discuss around the workplace with respect to the terms and conditions of employment, they may also discuss on social media. In an August 22, 2014 decision, the NLRB decided that “liking” a Facebook post that deals with working conditions is also “protected concerted speech.” Three D, LLC (Triple Play), 361 NLRB No. 31 (2014). The NLRB found that Triple Play Sports Bar and Grille violated the NLRA when it terminated two employees for participating in a Facebook discussion about the additional state income taxes they owed because of the employer’s withholding mistakes, including the one who had only “liked” the post.

The NLRB concluded that the Facebook discussion was protected activity because “the purpose of [the] employee communications is to seek and provide mutual support looking toward group action to encourage the employer to address problems in terms or conditions of employment, not to disparage its product or services or undermine its reputation….” The judge found that the employee’s “like” “expressed his support for the others who were sharing their concerns and therefore ‘constituted participation in the discussion that was sufficiently meaningful as to rise to the level of’ protected, concerted activity.” In balancing the interest of Triple Play’s owners in preventing harmful comments by their employees, the NLRB held that the comments were not “so disloyal” as to lose protection under the NLRA.

The NLRB also reviewed Triple Play’s Internet/Blogging Policy, and found that restricting online communications involving “confidential or proprietary information about the Company, or…inappropriate discussions about the company, management, and/or co-workers” violated the NLRA because it could reasonably include protected discussions. While the NLRB acknowledged that the policy did not “explicitly restrict protected activity,” it was still problematic because employees could reasonably interpret it as “proscribing any discussions about their terms and conditions of employment [that the employer] deemed ‘inappropriate.’”

As this decision makes clear, because a “like” standing alone can be protected, employers should tread carefully when considering taking action against employees for their social media activities and employer social media policies should be narrowly tailored to avoid prohibiting protected discussion. The NLRB will likely continue to scrutinize employer social media policies, and now is the time for employers to assess how to properly limit and respond to employees’ social media use.

Sara Dajani is an Associate Attorney with the DC region business law firm of Berenzweig Leonard, LLP. Sara can be reached at sdajani@BerenzweigLaw.com. 

Depressed Employee Wants Irregular Work Hours

A budget analyst for the Department of Agriculture with a long history of severe depression asked the agency for permission to work irregular hours each day depending on how she was feeling on a given day.  On some days, the depressed employee woke up too sick to work until the afternoon, when her condition would improve and she could get her work done; on other days, she was able to work in the morning but then had to stop in the afternoon when her depression got too bad.  Although she missed a lot of time at work due to her illness, the employee always completed her assignments on time and there were no complaints about her work product.  Even so, the agency insisted that she be at work during regular hours like her colleagues, and they denied her request for an irregular schedule.

The employee sued for disability discrimination, arguing that as long as she got her work done, it should not matter when during the day she did her work.  The agency countered that it should be able to insist that its employees be at work during normal set hours each day.

The employee’s position prevailed.  The federal appellate court for the District of Columbia recently ruled that an irregular schedule, such as the one sought by the budget analyst in this case, can be an appropriate accommodation under federal disability law.  The appeals court rejected the agency’s argument that irregular work schedules pose a per se unreasonable burden on employers.  Rather, there must be a fact-specific inquiry done on a case-by-case basis to see whether an irregular work schedule will work in a particular workplace for both the employer and disabled employee.  The appeals court noted that technological advances and the expansion of teleworking have already contributed to a more flexible work schedule for many employees.

Most companies want the discretion to set regular work hours for their employees, and this decision still allows them to do so as long as companies can show that a predictable work schedule is essential to the job an employee is doing.  In other words, companies need to be able to explain why it is critical for all employees, even disabled ones, to work during set hours.  Some reasons might include fostering workplace discussions or ensuring that employees are responding to client communications in a reliable and timely manner.  Such reasons should be conveyed to any employee who is seeking a deviation from his or her normal work schedule.

Declan Leonard is a Managing Partner of Washington, DC area business law firm Berenzweig Leonard, LLP. Declan can be reached at DLeonard@BerenzweigLaw.com.

Company Cannot Prohibit Employees From Disclosing The Personal Contact Information Of Other Employees

Tiffany & Company, the famed jewelry store, has a confidentiality policy that states, among other things, that its employees are prohibited from publicly disclosing other Tiffany employees’ contact information, including their names, addresses, telephone numbers, and e-mail addresses.  Though Tiffany is a non-union workplace, its policy recently came under scrutiny by the federal National Labor Relations Board (NLRB) after it received a complaint that the policy could interfere with an employee’s federally protected right to make the workplace better.  Tiffany countered that employment records are proprietary to the company, and allowing public disclosure of personal contact information could violate the privacy rights of its employees.

Tiffany’s policy was recently deemed unlawful.  According to the NLRB, the policy could prevent an employee of Tiffany from sharing co-worker information with a prospective union potentially looking to organize the workforce at Tiffany.  There was no evidence presented of any such union activity afoot at Tiffany, but the NLRB found that the mere existence of the confidentiality policy might chill an employee from collaborating with a union to organize at Tiffany.  The NLRB did caution that an employee would not be permitted to unlawfully access Tiffany’s employment records to get the contact information.  But if the employee was able to obtain employee contact information in the normal course of work, Tiffany cannot have a policy that prohibits the employee from publicly disclosing that information.

This is yet another case that reflects a growing trend in decisions by the NLRB of clamping down on companies that seek to restrict employees’ public discussion of workplace matters.  Companies need to carefully review their handbook and employee contract provisions to make sure they can withstand legal scrutiny by the federal government.

Declan Leonard is a Managing Partner of Washington, DC area business law firm Berenzweig Leonard, LLP. Declan can be reached at DLeonard@BerenzweigLaw.com.

FBI’s More Rigorous Physical Testing For Male Applicants Deemed Unlawful Gender Discrimination

All new applicants for the FBI have to pass a physical fitness test in order to be hired as an agent.  Men have to do a minimum of 30 push-ups, while female applicants only have to do 14 push-ups.  A male applicant, who had been selected “leader” and “spokesperson” of his applicant class by his peers, passed all other tests to become an agent with the FBI.  But he could only do 29 push-ups—one shy of the minimum requirement-- and therefore, he did not get an agent position with the FBI.  

He sued, arguing that the FBI’s higher push-up requirement for men than women was discriminatory.  The FBI responded that the different push-up requirement merely reflects the innate physical differences between men and women, and the FBI needs to ensure that all new agent hires have the requisite physical stamina to do the job.

A federal judge in Alexandria, Virginia found that the higher push-up requirement for male applicants was indeed discriminatory based on gender.  The judge recognized that in some instances, it might be permissible to have different physical fitness tests for men and women where the job requires men to exert more physical strength and stamina than women.  But in this case, the FBI expects both male and female agents to perform the same physical tasks at the same level of job performance.  Furthermore, the FBI does not require ongoing physical fitness testing by agents after they are hired.   Therefore, the FBI could not justify its policy of making men do more push-ups than women in order to be hired for the same position.

Declan Leonard, Managing Partner of Berenzweig Leonard, LLP, can be reached at DLeonard@BerenzweigLaw.com.

Employee’s Facebook Posting Not Enough To Put Her Employer On Notice Of Sexual Harassment

A restaurant employee, who claimed she was groped and fondled by a fellow employee, posted her complaints about the poor working conditions at the restaurant on Facebook.  The Facebook page was one that had been set up by employees of the restaurant to communicate about scheduling issues, but it also contained posts on problems in the workplace.  The employee conceded that she did not directly inform management at the restaurant about the sexual harassment prior to her termination, but she said that posting her complaints on the employee Facebook page was enough to put the restaurant on notice of what was going on.  She sued the restaurant for sexual harassment.

A federal judge in Indiana ruled that simply posting the complaints on a Facebook page set up by restaurant employees was not enough to show that the restaurant had notice of the conduct in order to find it liable, and dismissed the claim.  The judge noted that the restaurant employees made a concerted effort to keep restaurant management off of the Facebook page.  The judge also pointed to the fact that the restaurant had a specific handbook provision directing employees to report all incidents of harassment to management, and even had a hotline that employees could use for anonymous reporting.  Because the employee did not follow these established procedures for reporting the harassment, the judge refused to hold the restaurant liable.

This case underscores just how important it is for employers to have an established written policy for employees to use to report complaints, and to make sure that the policy is followed.

Posted by Declan Leonard, Managing Partner of Berenzweig Leonard, LLP. He can be reached at DLeonard@BerenzweigLaw.com.

Company Facing Age Discrimination Claim after Offering Conflicting Reasons for Terminating Employee

James Pierson worked at the Tennessee plant of a large national printing company for nearly forty years, when he was suddenly laid off at the age of 62. The company initially told Pierson that his layoff was due to a company-wide cost-cutting move, and that others were also being laid off to save the company money. But a human resource manager at Pierson’s plant prepared a document in support of the layoff that described Pierson as not being a “team player” and as lacking good interpersonal skills. At no time did anyone at the company mention Pierson’s age or longevity at the company as a reason for the layoff.

Pierson sued the company for age discrimination, but a Tennessee federal court dismissed the case prior to trial because Pierson was not able to point to any statement or document where the company took his age into account during the process of the layoff. Pierson appealed the dismissal of his case, and he won the appeal.

The federal appeals court in Tennessee ruled that because the company offered several different reasons to justify its decision to lay Pierson off, a reasonable jury could infer that these shifting reasons were intended to cover up the real reason for his lay-off: that being age discrimination. So even though there was no evidence of age discrimination presented to the court, the fact that the company did not speak with a unified and consistent voice as to why it laid Pierson off opened the company up to legal liability for age discrimination.

This case underscores just how critical it is for companies who are conducting a layoff or termination to be consistent from start to finish about why it is taking the personnel action. Even if the real reason for the termination is poor performance or misconduct by the employee, the company needs to make that reason clear at each phase of the separation process, or risk potentially exposing itself to legal liability for discrimination.

Declan Leonard is a Managing Partner of the business law firm Berenzweig Leonard, LLP. He can be reached at DLeonard@BerenzweigLaw.com.