I imagine that, if you are reading this blog, you have heard the big news: after 5 p.m. on the Tuesday before Thanksgiving, a federal judge in Texas issued an order granting a nationwide preliminary injunction that will prevent the DOL overtime regulations from going into effect today, Dec. 1, as everyone had planned.
According to the court, the plaintiffs had demonstrated a “likelihood of success on the merits” due to the fact that the DOL, in enacting the new overtime rule, had exceeded its authority through its significant increase of the salary threshold. The court took particular notice of the fact that an estimated 4.2 million workers currently ineligible for overtime would automatically become eligible, regardless of duties, due to the increased threshold. This, in the eyes of the court, would create “essentially a de facto salary-only test.” After analyzing the other requirements of a preliminary injunction, the court enjoined the DOL from “implementing and enforcing” the new overtime rule.
In Beverage Sys., LLC v. Associated Beverage Repair, LLC, 368 N.C. 693, 784 S.E.2d 457 (2016), the North Carolina Supreme Court clarified that North Carolina adheres to the “strict blue pencil rule;” that is, a trial court may strike distinct unreasonable restrictions in a noncompetition agreement but may not re-write provisions in order to make them enforceable, even if the parties, in the contract, authorize judicial revisions. The court sent a message it is not interested in expanding blue-penciling, noting no good could come from changing the role of the trial court:
Allowing litigants to assign to the court their drafting duties as parties to a contract would put the court in the role of scrivener, making judges postulate new terms that the court hopes the parties would have agreed to be reasonable at the time the covenant was executed or would find reasonable after the court rewrote the limitation. We see nothing but mischief in allowing such a procedure.
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A growing practice among employers is to require new hires to sign a Training Cost Agreement (TCA), which puts employees on the hook for the cost of their on-the-job training if they quit or are fired before completing a period of years of work for the employer. The concept is something like the evil twin of the signing bonus. However, a recent court ruling in the Middle District of North Carolina suggests enforcing these agreements may backfire and cause an employee who was previously exempt from overtime laws under the Fair Labor Standards Act to suddenly become subject to overtime laws, leaving the employer liable for back pay for any hours of unpaid overtime.
Under the FLSA, employees are entitled to “a fair day’s pay for a fair day’s work.” This includes overtime for nonexempt employees who work more than forty hours in a week. Exempt employees are not entitled to overtime. The determination of who is exempt and who is not can be complicated, and has been subject to fierce dispute in the courts. Typically employees classified as exempt are those whose job duties can be considered administrative, executive, or professional. But, these white collar workers may still qualify as nonexempt employees, if the way they are paid does not satisfy what’s called the “Salary Basis Test.”
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“I kept asking how I could improve, but my supervisor would never tell me what I was doing wrong, and when I was fired, it came out of the blue.”
It’s a complaint that we repeatedly hear as clients come into our offices, sure that they are victims of wrongful termination. They often point to positive performance evaluations and a lack of “write-ups” as evidence of their strong job performance. Some say that they only had a passing conversation with a manager regarding something that they could improve on. Often these employees are angry because they believe that they could have improved their performance had they just been given more indications of what they were doing wrong before they were terminated from their employment.
A Halloween treat for employers and a trick for FMLA-abusing, dishonest employees: The 4th Circuit held that terminating an employee for abusing FMLA leave and for lying during an investigation into the FMLA abuse is not retaliation under the FMLA. Sharif v. United Airlines, Inc., No. 15-1747 (4th Cir. Oct. 31, 2016). While the ruling in this case was easy based on the facts, the 4th Circuit has provided a clear framework going forward for attorneys to defend or prosecute claims of FMLA retaliation when the circumstances surrounding the request for leave or the leave itself triggers an investigation and adverse action.
In 2009, Masoud Sharif was diagnosed with anxiety disorder. United approved every one of Sharif’s requests for FMLA leave to handle his panic attacks. Sharif used a total of 56 days of FMLA leave in the two years prior to his discharge, including days after United initiated an investigation into his FMLA use.
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I come to you this beautiful October day with three scary topics you should likely avoid at any dinner party. However, as an employment lawyer and breast cancer survivor, I’m going to tackle all of them: Politics, sexual harassment and cancer. I’ll start with the last topic first. October is breast cancer awareness month. As a survivor of stage 1 breast cancer, I’m living proof that early detection saves lives. So if you or your loved one has been putting off a mammogram or checking something that seems worrisome, STOP! Make an appointment today. It matters – a lot.
Now, on to the other two … This election is testing many of the fundamental ideas we all believe in as Americans: democracy, patriotism, equal rights and freedom of speech. Keeping our opinions to ourselves this election season has become increasingly difficult. Without offering my own opinion on the candidates, one thing is very clear: sexual harassment is front and center in this election in a way it has not been since the early 1990s. And history shows us that when sexual harassment is at the forefront of political discussion, we all had best take note. The EEOC reported that charges filed alleging sexual harassment increased by over 60 percent the year following the Clarence Thomas confirmation hearings. While I would argue, based on my own experience, that companies are now in a much better position to address sexual harassment concerns and claims than they were 10 or 20 years ago, based on the current conversations being had on any cable news show, not all companies, even large, seemingly savvy companies, are doing it well. You can find the most recent data regarding EEOC charges related to sex harassment here: https://www.eeoc.gov/eeoc/statistics/enforcement/sexual_harassment_new.cfm
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A recent Eighth Circuit opinion found that a trucking company could force heavy-set truck drivers to submit to a sleep apnea exam as a “business necessity,” avoiding liability under the Americans with Disabilities Act (ADA), possibly paving the way for future class-wide medical examination requirements that comply with the ADA.
In Parker v. Crete Carrier Corp., 2016 WL 5929210 (8th Cir. October 12, 2016), a trucking company required its drivers who had a Body Mass Index (BMI) of 35 or greater to get medical examinations to determine if they had Obstructive Sleep Apnea (OSA). Parker, a driver for the company, objected to the sleep apnea investigation requirement and gave his employer a note from his doctor, which stated that he did not believe the examination was necessary. When the trucking company refused to allow Parker to conduct any further driving without the examination, Parker sued under the ADA, alleging he was discriminated against for being “regarded as” having a disability. The court assumed without deciding that requiring a medical examination for people with a BMI in excess of 35 was sufficient to show an employer regarded an employee as having a disability and proceeded to whether the employer had an affirmative defense.
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In the aftermath of Hurricane Matthew, 23 North Carolina counties have been approved to receive federal Disaster Unemployment Assistance. Gov. Pat McCrory has directed the state Department of Employment Security not to enforce the one-week waiting period that normally applies to unemployment claims.
The eligible counties are as follows: Beaufort, Bertie, Bladen, Columbus, Cumberland, Dare, Duplin, Edgecombe, Gates, Greene, Harnett, Hoke, Hyde, Johnston, Jones, Lenoir, Nash, Pender, Pitt, Robeson, Sampson, Wayne, and Wilson.
Thanks very much to John Hoomani, chief counsel of the DES, and to Jessica Leaven, chair of the Labor and Employment Section of the North Carolina Bar Association, for sharing this information.
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In EEOC v. Dimensions Healthcare Sys., No. 15-2342 (D. Md. Sept. 2, 2016), the District of Maryland denied the defendant’s motion for summary judgment on the plaintiff’s Title VII and Pregnancy Discrimination Act claims. The court’s decision largely turned on a decision maker’s comment, which the court found could be direct evidence of discrimination.
In that case, the plaintiff sought a promotion into a management-level position, but the company chose a male candidate instead. When the plaintiff asked the decision maker to explain the choice, the decision maker said that the company chose the man because of his “management background.” There was evidence that the plaintiff had reason to be suspicious of this explanation, so she asked again. This time, the decision maker allegedly explained, “Well, like I said, he has a management background. Plus, you were on maternity leave for a while.” Following this meeting, the plaintiff learned that the decision maker was alleged to have previously demoted female employees who had been out on maternity leave.
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The EEOC published two items last week of interest to employment counsel:
First, in the September volume of its Digest of Equal Employment Opportunity Law, the EEOC provided some rare insight into the way it views discrimination on the basis of mental health conditions under the Americans with Disabilities Act (ADA) and the Rehabilitation Act. Although the publication is aimed at government agencies, the guidance details the types of accommodations the EEOC expects of employers for employees or applicants with mental health conditions.
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