Lawsuits under the Revised Equal Pay Act are Out of the Gate Quickly

Well, that didn’t take long.

On the first business day that amendments to the Massachusetts Equal Pay Act were in effect, the first lawsuit was filed in Boston, according to published reports. It was brought by a female flutist in the Boston Symphony Orchestra who claims she was paid less than a male oboist, who also is part of the BSO’s woodwind section. According to the suit, the plaintiff has suffered wage discrimination for years because her work playing flute is comparable to her male counterpart’s work playing oboe. Regardless how the case turns out, it stands as yet another warning to employers who have yet to consider the effects that the revised Equal Pay Act will have on their businesses.

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The day that amendments to the Massachusetts Equal Pay Act went into effect, a female flutist in the Boston Symphony Orchestra brought forward a lawsuit.

The primary change to the Act, which has been around for decades, involves the comparison between male and female workers. That required showing was until now virtually impossible to make. The Equal Pay Act now makes it far easier for plaintiffs. The law as revised provides that employers may not discriminate in the payment of wages between men and women in “comparable” jobs – those that require substantially similar skill, effort and responsibility and are performed under similar conditions.

What this means is open to interpretation, leaving the courts to deal with pay discrimination claims one at a time and employers to worry about whether their practices pass muster. With steep potential damages and only a narrow set of viable excuses for unequal pay between the genders, employers need to consider avoidance options quickly. The law provides for a safe haven of sorts for companies that perform self-evaluations and make progress toward addressing illegal pay disparities before a suit is filed. While the conditions under which this makes sense are up for debate – it may not be a useful exercise for all companies – employers who fail to consider that option and others do so at their own peril.

Massachusetts High Court Concludes Workers can be Employees and Independent Contractors at the Same Time

image creditWhat once appeared to be an effectively impenetrable wall against the use of independent contractors in the Commonwealth saw a few bricks knocked out by a recent decision of Massachusetts’ highest court. At the same time, the court introduced substantial confusion into some relationships between employers and their workers, and the workers’ eligibility for certain benefits such as workers’ compensation and unemployment benefits.

In early May, the Supreme Judicial Court decided that a worker can be misclassified under the state’s Independent Contractor Statute, Mass. Gen. L. ch. 149, §148B, yet still be properly treated as an independent contractor under Mass. Gen. L. ch. 152, which governs workers’ compensation. The result raises the specter of the same worker being entitled to certain benefits as an employee while being properly denied others as an independent contractor. This includes both workers’ compensation and unemployment benefits.

Ives Camargo v. Publishers Circulation Fullfillment, Inc.

Confusing, I know, but this is precisely the implication of Ives Camargo’s Case, decided by the SJC on May 10. The case involved a worker who claimed she was entitled to workers’ compensation benefits for a job injury despite her classification as a contractor. Chapter 152 requires benefits only for employees, and the plaintiff argued – as many others have done successfully before her – that, because she was an employee under the Independent Contractor Statute, she was an employee for workers’ compensation purposes. Not so fast, the SJC said. It affirmed a decision by the Department of Industrial Accidents that denied benefits to the worker because she did not qualify as an employee under the 12-part test that applies in cases under Mass. Gen. L. ch. 152. Regardless of status under Mass. Gen. L. ch. 149, §148B, which makes pretty much every worker an employee, the SJC held that the plaintiff remained a contractor under the workers’ compensation law and could not recover for her injuries.

The difficulties this statutory scheme creates was expressly called out in a concurring opinion by the SJC’s chief justice, who called on the legislature to address it. “With so many different standards, it is difficult for employers to classify their workers properly,” CJ Ralph Gants wrote. “Enforcement also becomes more challenging….Most importantly, workers must struggle to understand and assert their rights.”

How can workers and employers comply?

The chief judge makes a strong point. It is one that both businesses and workers should take stock of as they evaluate their relationships and seek to comply with the law as best they can. The answer to the quandary they now face may be easy for businesses that traditionally use employees in their work forces. For those that don’t, a review of various laws and their implications is now necessary before legal pitfalls can be properly assessed. Meanwhile, employees and contractors alike may need to worry about which benefits they qualify for under which laws.

Supreme Court Upholds Employers’ Uses of Arbitration Clauses to Block Class Action Lawsuits

Arbitration Clauses

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The U.S. Supreme Court has again deflected a challenge to the use in employment agreements of dispute resolution clauses that mandate arbitration and generally bar class action lawsuits. The May 21, 2018 decision was a close call for employers: a 5-4 decision with the conservative majority carrying the day. Nonetheless, this represents a major victory in their battle against expensive lawsuits that pose extraordinary financial risks.

In Epic Systems Corp. v. Lewis, the Supreme Court dealt with challenges to class action restrictions in arbitration clauses based on the National Labor Relations Act (NLRA), which protect workers’ rights to collective activities. The NLRA guarantees employees the right to unionize and sets up an enforcement scheme under the National Labor Relations Board. After it altered its prior interpretation and held in 2012 that class actions could not be barred by arbitration clauses, challenges were filed based on a conflict between the NLRA and the Federal Arbitration Act (FAA), which provides for the enforcement of mandatory arbitration agreements. In the face of a strong dissent, the Court concluded that the NLRA cannot override the FAA because Congress did not provide for it to do so.

The use of mandatory arbitration clauses that bar class action lawsuits is growing in the Commonwealth. They provide potentially huge benefits by precluding the extreme risks presented by suits involving tens, hundreds or even thousands of employees. It is now common for larger employers who could face class actions by virtue of their sizes to mandate resolution of disputes by individual arbitration, and a growing number of small companies seeks the cost and time advantages arbitration can provide. To be sure, employers who use mandatory arbitration agreements must take care not to trample on employee rights and thereby invalidate their contracts, a result that remains possible under current law. Arbitration clauses are enforced only if they are reasonable and are contained in valid contracts between employees and employers.

Taking Action to Eliminate Sexual Behaviors at Work is Crucial for Avoiding Sexual Harassment Lawsuits

For those who have yet to grasp the significance of the #MeToo movement, which is encouraging women to complain about sexual mistreatment at work, here’s a bit more help. In late 2017, a poll by ABC News and the Washington Post found that 54% of women believe they received “unwanted and inappropriate” sexual advances at work, and 95% of them think such behavior normally is not punished by employers. About 80% of these women called the conduct sexual harassment. That means, according to the poll, about 33 million women think they were sexually harassed at work.

That, of course, is a lot of potential litigation, and there’s little doubt it’s being unleashed on employers who fail to take steps to address it. Fortunately, doing so effectively isn’t particularly complex, though it does require a firm commitment. Employers should begin by implementing or re-issuing, as the case may be, strong anti-sexual harassment policies, then follow them up with a concrete and sustained message that no sex talk or behavior will be tolerated at work or at work events. Here are a pointers for employers in this areas. Their goal should be to encourage employees to complain about perceived sexual issues so that employer’s action can follow and risks are thus minimized.

  1. Decide that an anti-harassment program is worthwhile and commit to it at the highest managerial levels. If top leaders don’t buy in and mean it, what follows will likely be a waste of time.
  2. Evaluate workplace interactions to see how employees talk with each other and behave on the job. A good baseline understanding here is important so that potential threats are exposed and employees can be asked to make specifically required changes.
  3. Be sure appropriate anti-harassment postings exist. Update or re-post them as needed.
  4. Train key personnel and consider training others. At the very least, be sure all employees get an in-person overview of the company’s anti-harassment policy and have the chance to ask questions. Key managers should be present when this is done to deliver the message that the company means what it says.
  5. Designate and train a key human resources person to answer questions and address complaints. Strange though it may seem, complaints about sexual behaviors are an employer’s friend, not its enemy. When workers believe the company will take them seriously and act, sexual harassment is normally dealt with internally. When they don’t, victims tend to remain silent and consider filing suit at the Massachusetts Commission Against Discrimination.

Limits Quickly Placed on Associational Discrimination Lawsuits

Not so fast, says the Massachusetts Court of Appeals. On the heels of the state’s highest court’s ruling that employees can sue their employers for discrimination against them based on their association with handicapped people, it promptly noted that not all associations are created equally. In Lashgari v. ZOLL Medical, which was decided a mere 3 weeks after the SJC affirmed that associational discrimination claims can be brought under the Massachusetts anti-discrimination statute, the Court of Appeals affirmed a lower court’s dismissal of a suit brought on the same basis.

Dismissals of lawsuits generally occur immediately after a suit is filed and help employers avoid the costs of defending them. The Lashgari case is significant in this respect as it begins to distinguish the factual patterns that will and will not state valid associational discrimination causes of action. The employee here asserted that his ability to work extra hours was proscribed by his son’s autism, which required constant care. He was demoted as a result and, he claimed, consequently suffered severe emotional distress. Eventually, the employee quit his job, claiming he’d been constructively discharged by his employer’s discriminatory behavior. Calling the allegations “conclusory and speculative,” the Court of Appeals found they were not sufficient to plausibly state a case of associational discrimination. The court was, of course, mindful of the SJC’s prior decision. It nonetheless held that employees must connect alleged discriminatory conduct to the particular association concerning which they complain.

WAGE ACT’S REACH EXPANDED BY SUPERIOR COURT JUDGE

In a surprising decision early this month, a superior court judge entered an expansive reading of the Massachusetts Wage Act that brings severance pay into the law’s ambit. If the thinking of Justice Dennis Curran is adopted by other judges or affirmed by the state’s appeals courts, it will leave employers who don’t make severance payments exposed to the Wage Act’s mandatory triple damages provision, its provision for individual management liability, and its requirement that defendants pay winning plaintiffs for all legal fees they expend.

Justice Curran’s decision came as a surprise because it has been largely accepted among employment lawyers that severance pay issues are not covered by the Wage Act. That law, which requires employers to pay their workers all wages they earn, including commissions, within specific and narrow time frames, appears on its face to apply only to money that an employee earns by appearing at work and performing job duties for his/her employer. Severance pay generally does not fit this description, coming as it does after an employee is terminated or quits and, therefore, after he/she stops coming to work. What’s more, severance is usually conditioned not on work performance but on a waiver of an employee’s rights to sue and other undertakings that have little to do with working. Apparently recognizing these distinctions between severance pay and wages, the state’s Appeals Court — a higher legal authority whose rulings must generally be followed by superior court judges — has already concluded that severance pay is not subject to the Wage Act’s strict penalty provisions. [Read more…]

UPS Hit Hard by MCAD Again

The Massachusetts Commission Against Discrimination has hit United Parcel Service with a second substantial judgment for discriminating against a Massachusetts employee. This time, the complaint was for handicap bias by UPS in Springfield, Massachusetts. After a trial at the MCAD, UPS was ordered to pay almost $750,000 in lost wages and another $125,000 in emotional distress.

The case of William Anderson, Jr. v. UPS was decided in March 2010. It involved a handicapped man who sought a reasonable accommodation but was denied by UPS, which refused to engage in a required interactive discussion with Mr. Anderson, made unreasonable demands, and, according to the Commission, placed form over substance as it violated Massachusetts anti-discrimination law. “Respondent’s approach to the reasonable accommodation process was long on formality, short on meaningful communication,” the Commission wrote. UPS took unauthorized photos that made demonstrated Mr. Anderson’s condition but still claimed to be uninformed about it. UPS was “rigid and unyielding” in its approach to Mr. Anderson and refused to engage in a flexible dialogue toward a mutually acceptable accommodation of his disabilities, the commission concluded. With interest and legal fees, the award could exceed $1 million. [Read more…]

Wrongful Termination Law in Massachusetts

Wrongful termination is a phrase frequently used by employers and employees alike to cover the whole rubric of potential causes of action that an individual could have against the company when he or she is fired.

Wrongful termination means, simply, that there is some kind of legal action that the an employee may take after being let go by an employer.

There are several discrete categories of wrongful termination in Massachusetts. Under the local law, all employees, unless they have a specific contract that they have negotiated with their employer, either in writing or orally, are At-Will employees.  This means they can leave whenever they choose to, or be let go whenever the employer chooses to let them go.  There are a couple of very narrow exceptions to the At-Will rule in Massachusetts that would constitute Wrongful Termination under the States Law. The exceptions are:

  1. A violation of Good Faith and Fair Dealing, meaning an employer, in a typical case, lets an employee go to avoid paying an employee a commission or large sum of compensation that would normally be due.
  2. Another way to violate the At-Will law is if an employer lets someone go in violation of something called the Public Policy Exception. There are very few Public Policy Exceptions. However, if an employee is serving on a jury, testifying in court, or performing some other act that the government wants to protect, the employer can not fire the employee for those actions.
  3. An employer also cannot fire or discharge someone in Massachusetts if they have a contract that provides otherwise. Sometimes employees have an employment contract that says,  for example,  they can only be fired for specific reasons, such as stealing from the employer, insubordination, or committing a crime. Where a company violates those terms, a breach of contract claim can arise in Massachusetts and that would be Wrongful Termination.
  4. The final category for Wrongful Termination involves discrimination cases. In Massachusetts, and under Federal Law, you can not let an employee go or treat them less favorably because of their race, gender, national origin, age, sexual orientation, handicap status, or genetic disposition.

If any of these factors are in play in your situation when you are let go from work, call me for a consultation.

If you have questions about Massachusetts employment law, consult an qualified Massachusetts employment lawyer before you take action.

Boston employment lawyer, Attorney Jack Merrill provides legal services to employees and employers throughout the Boston metro and Worcester County region including Ashland, Dedham, Framingham, Franklin, Hopkinton, Maynard, Marlborough, Milford, Natick, Needham, Newton, Shrewsbury, Sudbury, Waltham, and Worcester, Massachusetts.