Employment, Labor & Benefits Update

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1 Employment, Labor & Benefits Update March 2013 TOPIC OVERVIEW California: Employers Can Defend Findings of Discrimination by Proving Separate Legitimate Reasons... 1 FMLA: There Is No Such Thing as FMLA Light Duty... 2 Report from Springfield and Government Agencies... 3 California: Employers Can Defend Findings of Discrimination by Proving Separate Legitimate Reasons By Asa Markel In its recent decision in Harris v. City of Santa Monica, No. S (Cal. Feb. 7, 2013), the California Supreme Court held that the mixedmotive defense applies under California s employment discrimination statutes. Under the defense, now known as the same-decision defense in California, employers can defend against a former employee s claim of discrimination by proving that the employer had non-discriminatory reasons that justified making an adverse employment decision. If the employer is able to prove its samedecision defense, it can avoid monetary damages. The Harris case involved a former bus driver who claimed that she was fired for being pregnant. Her employer defended the case by showing that the decision to fire the driver was based upon her poor performance record. Title VII of the federal Civil Rights Act of 1964 forbids discrimination against workers in businesses that have fifteen or more employees. California s Fair Employment and Housing Act (FEHA) forbids discrimination in businesses of five or more employees. Federal law has allowed employers to avoid paying monetary damages to employees who can prove that discrimination occurred, as long as the employer could prove that it had legitimate reasons for taking an adverse action against an employee. Courts in California disagreed on whether FEHA allowed an employer the same defense. The Harris case will go back to the trial court. If the employer proves a legitimate reason for the firing, the former employee can still prove that sex discrimination was a substantial factor in her firing. If she can prove this, the Harris decision provides that she may be able to recover attorneys fees, declaratory relief, or an injunction. However, she cannot recover monetary damages or force her employer to reinstate her. Masuda Funai s Employment, Labor & Benefits Update is provided as a free service of the firm regarding legal developments. It is not a substitute for legal counseling and may constitute advertising material Masuda, Funai, Eifert & Mitchell, Ltd. All rights reserved.

2 The Harris decision provides some relief for an employer who can prove a same-decision defense by shielding the employer from damages awards. However, plaintiffs attorneys will likely continue to file discrimination cases in the hope of asking for attorneys fees if discrimination is shown to be a substantial factor in any adverse action taken against the employee. This way of thinking will continue to influence settlement discussions with employers. Businesses with questions regarding these changes to California discrimination law are welcome to consult with a member of the Firm s Employment, Labor and Benefits Practice Group. FMLA: There Is No Such Thing as FMLA Light Duty By Frank J. Del Barto Recently, the U.S. Court of Appeals for the 7 th Circuit affirmed summary judgment for the employer in a case where an employee filed suit contending that his employer failed to return him to work after the submission of various releases from his doctors. In essence, he argued that his employer left him on FMLA leave too long. James v. Hyatt Regency Chicago, No , (7 th Cir. 2013). Carris James ( James ) was employed by the Hyatt Regency Chicago ( Hyatt ) as a banquet steward. In March 2007, he was involved in an incident outside of work and was punched in the left eye which caused a retinal detachment. In April 2007, he had eye surgery and had to miss work in order to recuperate. When Hyatt learned that his absence was due to a medial reason, it provided him with FMLA paperwork. On April 24, 2007, James provided Hyatt with a note from his doctor stating that he could return to light duty work on May 10, The note did not list any specific restrictions, nor did it provide any duration for the light duty requirement. Hyatt did not return him to light duty. The next day, he requested FMLA leave and Hyatt granted his request applying it retroactively to cover his absence prior to the submission of his certification paperwork. On May 11, 2007, he submitted an FMLA certification form which stated that he required continued FMLA leave because he was unable to return to work in any capacity. Although his 12 weeks of FMLA leave entitlement ended on July 13, 2007, the collective bargaining agreement entitled him to remain on FMLA leave for up to one year from his original submission date. On August 2, 2007 and September 25, 2007, he submitted additional notes from his doctor. Hyatt attempted to contact James in September and December 2007 to seek additional information about the specifics of his restrictions and the conflicting paperwork that he had been submitting. In January 2008, Hyatt reached out directly to his doctor for a clarification of his condition. On February 17, 2008, James returned to work in the same position, shift and seniority level as before his leave of absence. Notwithstanding his return to work, he filed suit in 2009, alleging interference and retaliation under the FMLA and discrimination and retaliation under the ADA. The district court granted summary judgment in favor of Hyatt and James appealed. On appeal, James argued that Hyatt interfered with his FMLA rights when it did not reinstate him to his steward position after he provided the April 24, 2007 doctor s note that released him to light duty starting on May, 11, The Court disagreed. Noting that James April 24, 2007 note did not release him to return to work in any capacity until May 10, 2007, the Court could not understand how Hyatt could have interfered with his FMLA rights on April 24, 2007, when he wasn t even released to work until May 10, Second, the note only permitted him to return to light duty beginning on May 11, 2007 and did not provide any duration for this light duty requirement Masuda, Funai, Eifert & Mitchell, Ltd. All rights reserved. 2

3 In affirming the grant of summary judgment, the 7 th Circuit noted that the FMLA requires an employer to restore an employee to the position he/she held at the time the FMLA leave began or an equivalent position with equivalent employment benefits, pay and other terms and conditions of employment. However, under the FMLA, an employer is not required to return an employee to his or her position, if he or she cannot perform the essential functions of the job. As the court stated, there is no such thing as FMLA Light Duty. With regards to his ADA failure to accommodate claim, the Court indicated that because James was simultaneously submitting conditional releases, along with paperwork that he was incapable of returning to work, he could not establish that Hyatt failed to accommodate him. Moreover, because one of the releases that he submitted restricted him from performing two essential functions of his position (lifting and bending); the Court found that this would not be considered a reasonable accommodation because it would equate, essentially to reassignment of the job itself. Should you have any questions about FMLA leave or ADA requirements, please contact a member of the Employment, Labor and Benefits Practice Group. Report from Springfield and Government Agencies By Alan M. Kaplan In Springfield The Illinois State Legislature will be considering several employment laws. The Workplace Violence Prevention Act allows companies to seek a stay away order or an injunction against an employee or an individual engaging in or threatening violence. The violence or threat of violence must have taken place at the company s facility. The law would not apply to labor disputes with unions. As in 2012, a bill has been introduced to regulate non-competition agreements. Called the Employment Noncompete Agreement Act, the law would allow restrictions on former employees from soliciting existing and prospective customers. The periods of restrictions would need to be reasonably related to the employee s position and salary. For example, the maximum period of the restriction would be 6 months, if the employee s annualized compensation is less than $50,000. If the employee s annualized compensation is over $150,000, the maximum period of the restriction would be 18 months. Finally, changes to the Illinois Human Rights Act are also being considered. One issue is the definition of a supervisor and whether the Illinois law should be the same as the federal law. Under the federal definition, employers should have additional arguments to defend themselves in discrimination cases. Other new laws would affect the ability of companies to consider arrests when making employment-related decisions. FMLA & Adult Children The U.S. Department of Labor has clarified the use of Family & Medical Leave for the adult children of eligible employees. Employees have always had the right to take FMLA leave to care for an adult child, but clarification was needed. The U. S. Department of Labor has now clarified that employees may use FMLA leave to care for a son or daughter over the age of 18 with a serious health condition, if the child has a disability as defined by the Americans With Disabilities Act, the child is incapable of self-care, the child has a serious health condition, and the child is in need of care. According to the USDOL, the child may have developed the disability either before or after turning 18 years of age Masuda, Funai, Eifert & Mitchell, Ltd. All rights reserved. 3

4 Revised FMLA Poster In addition, the U.S. Department of Labor has issued a new poster for the FMLA. The new poster reflects changes in the definition of veteran. In addition, the poster defines serious injury or illness for service members and veterans. We recommend contacting a service provider or vendor to obtain the new poster. However, be careful not to post the poster issued by the National Labor Relations Board which includes an explanation of the rights of employees to unionize. The lawsuit contesting the issuance of this poster is still pending, although some vendors are still including this poster as part of the group posters they sell to companies. EEOC s Statistics The Equal Employment Opportunity Commission reported its statistics for Fiscal Year Individuals filed approximately the same number of charges in FY2012 as filed in FY2010 and FY2011. In each of these three years, individuals filed between 99,412 and 99,947 charges. The EEOC is engaged in systemic investigations in which it is determining whether a pattern or practice or a policy has a broad impact on an industry, profession, company or geographic area. During FY2012, the EEOC filed half the number of lawsuits as in FY 2011 but collected four times the amount of damages. Specifically, the EEOC filed 12 lawsuits in FY2012 and collected $36.2 million in damages. The majority of lawsuits alleged violations of the Americans With Disabilities Act, which is consistent with the questions most frequently received from the Firm s clients Masuda, Funai, Eifert & Mitchell, Ltd. All rights reserved. 4

5 For more information about this or any other employment law topic, please contact Alan Kaplan, Chair of the Employment, Labor & Benefits Group, at or via at About the Employment, Labor & Benefits Group Masuda Funai s Employment, Labor & Benefits Group provides expertise in all aspects of employment, labor and benefits law. Our attorneys represent management in everything from day-today counseling to drafting, negotiations, litigation in federal and state courts, executive and employment agreements, mergers and acquisitions, reorganizations, benefits and compensation plans, OSHA issues, union campaigns, collective bargaining, unlawful picketing and trust fund contribution matters. Our attorneys regularly conduct employment audits, present in-house supervisory training programs and seminars and publish articles and newsletters to help keep our clients up to date about the ever-changing world of employment, labor and benefits law. About Masuda Funai Masuda Funai is a full-service law firm representing international and domestic companies operating and investing in the United States. Our 40 attorneys located in Chicago, Schaumburg and Los Angeles counsel clients in every aspect of business, including establishing, acquiring, and financing operations; ownership, development and leasing of real estate; transfer of overseas employees to the U.S.; employment, labor, and benefits counseling and dispute resolution; intellectual property, copyright and trademark; business litigation; creditors' rights and business risk management; structuring the distribution and sale of products and services throughout the U.S. CHICAGO 203 North LaSalle Street Suite 2500 Chicago, Illinois TEL FAX LOS ANGELES South Vermont Avenue Suite 420 Torrance, California TEL FAX SCHAUMBURG 1475 East Woodfield Road Suite 800 Schaumburg, Illinois TEL FAX Masuda, Funai, Eifert & Mitchell, Ltd. All rights reserved. 5

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