Employer Learns Reasonable Accommodation Lesson that’s Instructive to All

The Supreme Judicial Court recently clarified the legal hurdles employers must satisfy when defending claims that they failed to reasonably accommodate their disabled employees. In doing so, it gave one employer a lesson that all will be well-advised to pay attention to.

The case involved a police officer who suffered a head injury. Though he contended he remained capable of performing patrol officer duties without posing an unreasonable risk of injury to himself or others, his department disagreed. It confined him to desk duty, then defended his lawsuit claiming, in effect, that it acted in a good faith belief that the officer could not perform the essential functions of his patrol job. After a superior court judge granted the department summary judgment, the SJC reversed. It held that the issue is not whether an employer in such circumstances acts in good faith — something an employee will have an extremely difficult time disproving — but whether the employee demonstrates he/she can do the relevant job with reasonable accommodation. The department now faces a jury trial on this relatively narrow and perhaps difficult question.

The case illustrates a common problem employers face in handicap cases — a failure to properly understand their duties to reasonably accommodate disabled workers. The fact is that workers must be accommodated whenever reasonably possible, and employers should consider this carefully and thoroughly before denying accommodation requests. Among other things, they should fully review all possible job adjustments and engage in meaningful discussions with their employees. Only when no accommodation is possible or the ones that do exist impose undue hardship should employers deny their employees requests. Such decisions should never be made lightly.

Federal Courts Move Toward Ban Against Sexual Orientation Discrimination

A U.S. Federal Court this week lent more weight to the notion that a federal law that bans employment discrimination applies to employers whose conduct is motivated by their employees’ sexual orientation. By a decisive 8-3 margin, the full court for the 7th Circuit applied Supreme Court precedent on sexual stereotyping to conclude that a gay professor enjoys the protections of Title VII, which proscribes certain forms of employment discrimination as part of the Civil Rights Act of 1964.

Though the ruling does not apply outside the 7th Circuit, it is significant for several reasons. First, it reverses precedent from the same circuit to the effect that sexual orientation is not a protected category under Title VII. Second, the majority reportedly consists of several Republican Party appointees, indicating broad agreement that gays are protected against discrimination under federal law just as they are by the U.S. Constitution. Third, the decision is at odds with other circuit courts, a situation that could lead the U.S. Supreme Court to settle the question. The Court frequently does so when circuits courts are split on significant issues such as the breadth of Title VII. The Equal Employment Opportunity Commission (EEOC), which enforces Title VII, agrees that sexual orientation discrimination is banned under that law.

What the federal courts ultimately decide on sexual orientation discrimination may not be as significant in Massachusetts as in other states. Here, state law already provides protections for gay workers, who can bring claims of job discrimination to the Massachusetts Commission Against Discrimination and state courts.

MCAD Decision: Employer Duty to Reasonably Accommodate Handicapped Employees is Extremely Broad

In the usual case, employers that receive reasonable accommodation requests from their employees try to help. They may adjust a work schedule, grant a leave of absence, or even modify job duties. Too often, however, those same employers fail to grasp the broad scope of their ongoing duties to accommodate. They reach what they perceive as an end point based on their own interpretations of what’s reasonable, then refuse to help workers further. Decisions like that have a high potential to lead them into hot legal waters.

A recent Massachusetts Commission Against Discrimination (MCAD) decision illustrates this point. The employer involved believed it bent over backwards, as it were, to help its employee. It gave her 12 weeks of FMLA leave, 23 weeks of part-time work, job relocation, and adjustments to avoid heavy lifting. Despite the seeming generosity of these accommodations — a fact expressly noted by the MCAD in its decision — the employer was tripped up when it refused to extend part-time work for three additional weeks so its employee could complete physical therapy and, hopefully, return to full-time work. Because the employer could not demonstrate that the continued leave would impose an undue hardship, it violated the Massachusetts anti-discrimination statute. It was ordered to pay damages to its former employee despite the fact that she did not recover sufficiently to work full-time as hoped.

The lesson for employers here is patent. Reasonable accommodation is an ongoing and fungible process that requires regular reassessment of workplace requirements and employee needs. Granting a work adjustment is not alone enough to satisfy the law, which requires an interactive engagement with employees in search of accommodations that are reasonable and appropriate under given circumstances. Employers who fail to understand that process as they seek to themselves decide what’s reasonable and what is not run the risk of lawsuits. In most cases, those suits can be avoided by careful consideration of what the law requires.

Marijuana Use Rights Arise in Employment Situations

With the enactment of two marijuana laws in Massachusetts during the past few years, there’s never been much doubt that use of it would someday become a workplace issue. Now, the Supreme Judicial Court is taking up the issue in connection with medical marijuana use. It seems likely that similar legal questions regarding recreational use of the drug will also soon arise in the wake of the 2016 legalization of marijuana in the Commonwealth.

The current case involves an employee who was fired after she failed her employer’s mandatory drug test. She sued, claiming her rights were violated because she was legally authorized to use marijuana to treat Crohn’s Disease. According to the complaint, her employer told her it did not care about her medical authorization to use marijuana because it followed federal law, under which marijuana remains illegal. After the superior court dismissed her lawsuit, the SJC opted to hear her appeal. It will reportedly consider both whether the company violated Massachusetts anti-discrimination laws and whether employees can sue their employers under the medical marijuana statute.

The case signals problems on the horizon for employers on various fronts. Drug testing has long been a problematic policy that runs headlong into individual rights of privacy. Since testing can potentially uncover drug use that occurs outside work, employers need to respond to positive tests carefully. Now that marijuana is legal for recreational use in Massachusetts, complexities with testing and in other areas of the employer/employee relationship will likely multiply. The wisest course may be for employers to treat marijuana as they commonly do alcohol — by proscribing its use only while employees are working.

U.S. Supreme Court Delays Hearing on Cases that may Decide whether Class Action Rights can be Waived

The U.S. Supreme Court may have accepted a group of cases that will determine whether companies can require their workers to waive class action rights, but that doesn’t mean it’ll be deciding this important question anytime soon. After accepting the cases for review in January, the Court announced that it will not hold oral arguments this term. The cases will be argued in Fall 2017 and decided some time thereafter, perhaps well into 2018.

The significance of this is patent. First, it suggests that the Court may be divided on the class action waiver question and requires a deciding voter. The Court now has only 8 justices in the wake of the Republicans’ 2016 refusal to consider President Obama’s nominee to the bench. They won’t do the same with their own party’s nominee(s), and the Court will surely have 9 members soon. Second, the delay means that uncertainty over class action waivers in employment agreements will remain for some time. This will likely encourage litigation in lower courts over the issue and may cause decisions to be delayed.

It is common today for companies to have their workers sign agreements that include arbitration provisions requiring lawsuits to be pursued individually. This is sometimes impractical due to the small size of a claim, and an employee or independent contractor therefore may seek to bring suit on behalf of others. The Supreme Court has previously found that mandatory arbitration agreements are generally enforceable. It’s now being asked to resolve lower court disagreement about whether federal law allows companies to avoid class action lawsuits through arbitration clauses.

EEOC Working on New Anti-Harassment Guidance

The Equal Employment Opportunity Commission (EEOC) is currently working on new guidance to help analyze and decide claims involving harassment in the workplace. The new rules promise to bolster enforcement against harassers as it follows a task force finding that the issue remains a serious problem in the American workplace. The new guidance will explain the law as interpreted by courts and serve as a reference for EEOC enforcement staff and other federal officials. It is likely to be used by courts and litigants as well.

The guidance will likely deal with harassment based on race, color, religion, sex, national origin, disability, age and genetic information. There is no current timetable for its release. The EEOC recently extended the time period for comments on it March 21, 2017. A copy of the proposal can be found at www.regulations.gov/document?D=EEOC-2016-0009-0001.

Minimum Wage Now at $11 Per Hour

Effective January 1, 2017, the minimum wage for Massachusetts workers rose from $10 to $11 per hour. The new rate applies to almost all employees. For employees who regularly receive tips as part of their pay, the minimum rate is $3.75/hour. Those workers’ total compensation with tips included must be at least $11/hour. All categories of workers remain eligible for overtime pay at 1.5 times their normal rates of pay for hours worked above 40 in a workweek. Some workers are exempt from overtime requirements based on job classifications and administrative requirements.

SJC Holds that Second Element of Independent Contractor Test is Preempted by Federal Law

The Massachusetts Supreme Judicial Court today weighed in on the hot topic whether and to what extent the state’s Independent Contractor Statute is exempted as applied to courier drivers and the companies they work for. Like a federal court that ruled on the same question last year, the SJC concluded that the second of the law’s three elements is preempted by the Federal Aviation Administration Authorization Act (FAAAA).

Legal battle over the applicability of Mass. Gen. L. ch. 149, §148B has raged for years, with courier companies seeking to avoid application of what’s referred to as Prong B of the statute – the requirement that all individuals who perform services within a company’s regular course of business be classified as employees. The companies rely on the FAAAA’s restriction against state laws that impact the prices, routes or services of covered businesses. Because Prong B is so broad, they contend, it effectively bars all uses of contractors to make deliveries. This, in turn, forces courier companies to eliminate services, increase costs, alter routes, and make other business changes.

Though two state judges had previously ruled that the entire Independent Contractor Statute was preempted by the FAAAA, the SJC rejected this approach. The law’s first and third elements thus remain intact. In order to avoid classifying their drivers as employees, courier companies must demonstrate that they do not control the performance of their work and that the drivers are customarily engaged in an independent business. There are currently several active cases on this topic, including two class action suits being handled by my office.

Legislators Work to Revive Noncompetition Law

Recent reports suggest that Massachusetts legislators are continuing to work on a compromise noncompetition law that will garner enough support to become law. Earlier this year, both the House and Senate passed versions of a proposed statute that would have imposed rules on noncompetition agreements, which are currently governed by judges without direction from a formal statute. Because the House and Senate could not reach a compromise over differences in the bills each passed, the proposed statute died with the end of the legislative session on July 31, 2016.

Indications are that, this and other failures notwithstanding, Massachusetts will soon enact a law to govern the uses of noncompetition agreements. Among the provisions now being discussed are ones that would require advance notice to employees, limit the duration and applicability of restrictive covenants, and require employers to continue to pay some portion of a former employee’s salary as a condition to enforcement. If no deal is reached informally this month, legislation will almost certainly be reintroduced when the House and Senate reconvene in January 2017. Any bill they pass must, of course, be signed by the governor.

New Overtime Rule Blocked by Federal Judge

In a surprising decision, a judge in the U.S. District Court for Texas not only granted an injunction to 21 plaintiff states that sued to block the U.S. Department of Labor’s overtime updates set to take effect December 1, 2016, he applied his ruling to all 50 states. The result is that, at least for now, employers in Massachusetts need not update pay scales. As long as executive, administrative or professional employees make at least $455/week — the minimum pay requirement now in effect — they will remain exempt from overtime pay requirements.

Judge Amos Mazzant reasoned that the Department of Labor (DOL) could not update the minimum salaries for executives, et. al., because Congress clearly intended the exemption to turn on a duties and not a salary test. Each of the three affected categories or workers carries with it specific criteria for determining applicability, commonly referred to as duties tests. While Judge Mazzant called the Congressional intent in this regard to be so clear that it blocks the DOL from increasing the minimum salary requirement, he did not address the question why or how a DOL regulation has, apparently properly, for years included a minimum salary component for executive, administrative and professional worker overtime exemptions. Indeed, the new DOL rule that was to take effect December 1 seeks to update the minimum salary from $455 to $913 weekly and to implement an automatic pay adjustment mechanism going forward. The court’s November 21, 2016 decision in State of Nevada v. U.S. Department of Labor leaves the old threshold in place.