Whistleblower Claim by Health Care Worker Dismissed Creating Questionable Public Policy

Posted on by

Several different whistleblower laws protect Massachusetts employees. In particular, M.G.L. c. 149, §187 protects health care providers from retaliation for disclosing problems within health care facilities. In Romero v. UHS of Westwood Pembroke, Inc.et al., the Massachusetts Court of Appeals recently issued a ruling dismissing a health care provider’s wrongful termination claim after she objected to a proposed policy that she believed was unlawful if implemented.

Unfortunately, the Appeals Court construed the health care whistleblower statute narrowly. Section 187(b)(3) prohibits retaliation against a health care provider who:

[O]bjects to or refuses to participate in any activity, policy or practice of the health care facility or of another health care facility with whom the health care provider’s health care facility has a business relationship which the health care provider reasonably believes is in violation of a law or rule or regulation promulgated pursuant to law or violation of professional standards of practice which the health care provider reasonably believes poses a risk to public health.

In dismissing the employee’s whistleblower claim, the court reasoned that an employee who objects to a proposed unlawful activity, policy, or activity is not protected under Section 187(b)(3).

The ruling creates an obvious disincentive for health care providers to speak out against and oppose proposed policies, which they reasonably believe will pose a risk to public health. Rather, as the court’s decision makes clear, an employee’s conduct is only protected where there is opposition to an existing policy.

Wage & Hour Class Actions Gain Momentum: Gristedes Violates Fair Labor Standards Act

Posted on by

The Fair Labor Standards Act (FLSA) requires employers to pay its employees overtime pay for all hours over 40 hours per workweek. Employees who work overtime hours must be paid at a rate not less than time and one-half their regular rates of pay.

Employers can avoid pay overtime pay only in limited circumstances. For example, managers and supervisors may qualify for the executive exemption if they: (1) manage at least two direct reports, (2) possess the authority to hire and fire employees, or whose input into such matters weight, and (3) regularly exercise discretion about how to carry out their job duties.

Unfortunately, to increase profits, some employers may classify an employee as exempt from overtime, even though the worker’s duties and responsibilities do not warrant such an exemption. To illustrate such a scenario, lets look at the TV sitcom, The Office. Specifically, as the the self-proclaimed Assistant Regional Manager, would
Dwight Schrute satisfy the executive exemption? The answer is obvious: Dwight would not meet the executive exemption because, despite his title, he has no direct reports; no authority to hire or employees; and spends the majority of his time selling Dunder Mifflin’s paper products, not managing employees.

On a much larger scale, a similar question recently arose in a lawsuit against the New York grocery store chain, Gristedes. In Torres v. Gristedes, Judge Paul A. Crotty of Federal District Court in Manhattan found that Gristedes violated federal and state laws by misclassifying department heads and so-called co-managers as exempt from overtime

[T]he overwhelming weight of the evidence suggests … that the class members were not salaried executives or administrators within the contemplation of the FLSA. Instead, … Gristede’s co-managers and department managers received a regular paycheck that was tied automatically to the amount of hours they worked during the pay period.

The decision affects approximatelt 400 current and former Gristedes’ managers who, collectively, may be owed as much as $25 million.

In reaching such a successful result, the plaintiff’s relied on well-known economist, Dr. Stephen A. Schneider of Nathan Associates, Inc., who provided statistical analysis regarding the gross underpayments made by Gristedes.

To read more about the settlement, visit the New York Times article entitled, Judge Rules That Gristede’s Broke Law on Overtime Pay.

Sexual Harassment Claims in Federal Court: Overcoming the Farragher/Ellerth Defense

Posted on by

Employees who are victims of sexual harassment must take great care to protect their rights. The First Circuit’s decision in Chaloult v. Interstate Brands represents a broadening of the Farragher/Ellerth defense, which allows employers to escape liability even when an employee has clearly suffered inappropriate and demeaning conduct over a prolonged period of time.

The Farragher/Ellerth defense is an affirmative defense arising out of two 1998 Supreme Court decisions: Farragher v. City of Boca Raton, and Burlington Industries v. Ellerth. For the Farragher/Ellerth defense to be apply, an employer must satisfy two elements: (1) reasonable care was taken to prevent and promptly correct the harassing or discriminatory behavior, and (2) the employee unreasonably failed to take advantage of the preventive or corrective opportunities provided.

In June 1999, Bonnie Chaloult began working at Interstate Brands in Biddeford, Maine. In August 2005, Chaloult resigned after a enduring a series of debasing remarks from her supervisor, Kevin Francoeur. Such remarks included:

Accusing Chaloult of having sexual relations with her direct supervisor
Complaining about his wife, his lack of sexual relations with her, and voicing his desire murder his wife
Asking about the distance between her nipples and telling her to go home and measure this distance
Asking her if her nipples chafed or stood out like headlights
Stating that her breasts were “melons” and “big hooters”
Asking her to hold her breath and push her chest out
Offering to go to her house and have sex with her
Stating that he wanted to see how far she could stick an eclair down her throat, stating “[i]f there isn’t enough cream in there, . . . I have plenty”
Asking Chalout’s manager, “How long have you [two] been fucking?”

Francoeur made many of these disparaging remarks both in front of Chalout’s co-workers as well as her manager. Ironically, the employer had a policy requiring all managers to all report sexual harassment and inappropriate conduct to Human Resources. Chalout’s manager failed to abide by this policy. Although Chalout’s letter of resignation did not detail specific instances of misconduct, it made clear that she no longer felt comfortable working at Interstate Brands because of statements made by Francoeur.

Approximately one year later, Chaloult filed a lawsuit based on, among other things, the sexual harassment she suffered from Francoeur. Surprisingly, the federal District Court of Maine accepted the Farragher/Ellerth defense on the basis that Chaloult failed to report specific instances of misconduct. The First Circuit affirmed the district court’s decision. In doing so, both courts failed to acknowledge the reality of workplace. If your manager knows that your supervisor is subjecting you to such demeaning conduct, and fails to take remedial measures, how confident would you feel in voicing such concerns. Would you keep quiet to ensure to avoid possible retaliaton?

Workplace Discrimination Claims in Federal Court: A Word of Caution

Posted on by

If you’ve been discriminated against in the workplace, you should think twice before bringing your claims in federal court. In 2009, the Harvard Law & Policy Review will publish, Employment Discrimination Plaintiffs in Federal Court: From Bad to Worse?. The study, conducted by Cornell Law School Dean Stewart J. Schwab and Cornell Law Professor Kevin M. Clermont, examines official data from the Administrative Office of the United States Courts. The article reveals that plaintiffs who bring employment discrimination claims in the federal courts fare less favorably when compared to plaintiffs in other types of cases. As an example, the authors discovered that employers found liable for workplace discrimination at trial enjoy more than a 40% chance of reversal on appeal. In stark contrast, plaintiffs who lose at the trial court level have only an 8% chance of receiving a favorable appellate decision.

Is your Employment Contract Watered Down? The First Circuit Provides Insight

Posted on by

The First Circuit’s decision in Noonan v. Staples provides an informative example of how an employment contract should and should not be written. In that case, Staples discharged Noonan for allegedly padding his expense reports. In doing so, Staples refused to allow him to exercise his stock options, claiming that Noonan was ineligible because he had been fired for “cause.” In particular, Noonan’s employment contract stated as follows:

[I]f [Noonan’s] relationship with Staples is terminated by Staples for “cause” … the right to exercise this option with respect to any shares not previously exercised shall terminate immediately …

The contract provided a definition for “cause,” but gave Staples the discretion to ultimately interpret whether Noonan’s alleged transgressions fit that definition. The question before the First Circuit was whether it could review Staples’ interpretation.

In their respective arguments before the First Circuit, Staples argued that the court had no authority to review its “cause” determination, while Noonan argued that the court could review Staples’ decision de novo with no deference to Staples’ reasoning.

The court rejected both arguments and, relying on precedent, adopted a middle ground. In particular, the court held that while Staples’ decision could be reviewed, it would only be overturned if it was arbitrary, fraudulent, or made in bad faith. This is an extremely high standard. Not surprisingly, in light of this standard, the First Circuit affirmed Staples’ decision to terminate Noonan for “cause.”

The lesson learned: Review your employment contract with counsel before you sign it. Where possible and necessary, revise the language to ensure that your employer does not enjoy total discretion to decide the definition of “cause.”

Workplace Bullying Decision Long Overdue

Posted on by

The employment law landscape is ever-changing. The Indiana Supreme Court’s decision in Raess v. Doescher (Supreme Court) is proof positive. In that case, a jury awarded the plaintiff-hospital technician, Joseph Doescher, $325,000 for the assault he experienced from the hospital’s supervising surgeon, Daniel Raess. Claims for assault are nothing new. What makes this case unique is the evidence that the plaintiff had the opportunity to present. In this particular case, the supervising surgeon had a colorful history of, shall we say, treating his colleagues and subordinates with disrespect. Put differently, the defendant was a “workplace bully.” Seeking to exclude all evidence related to the surgeon’s prior outbursts, the defense asked the trial court to instruct the jury as follows:

“Workplace bullying” is not at issue in this matter, nor is there any basis in the law for a claim of “workplace bullying.” In other words, you are not to determine whether or not the Defendant, Daniel Raess, was a “workplace bully.” The issues are as I have instructed you: whether the Defendant assaulted the Plaintiff, Joseph Doescher on November 2, 2001, and whether that assault constituted intentional infliction of emotional distress.

The trial court refused the instruction. The Appeals Court in Raess v. Doescher (Appeals Court) reversed on the basis that the probative value of the workplace bullying evidence was substantially outweighed by the unfair prejudice. In the end, the Indiana Supreme Court had the last say:

In determining whether the defendant assaulted the plaintiff or committed intentional infliction of emotional distress, the behavior of the defendant was very much an issue. The phrase “workplace bullying,” like other general terms used to characterize a per-son’s behavior, is an entirely appropriate consideration in determining the issues before the jury.

As expected, the jury’s verdict was upheld. For more information about the decision, please visit the Boston Business Journal’s article entitled, Bullies beware: Employees have more options — including court — to confront bad bosses.

Seventh Circuit Issues Employee-Friendly Pregnancy Discrimination Act Decision

Posted on by

In 1978, Congress passed The Pregnancy Discrimination Act of 1978, which acts as an amendment to
Title VII of the Civil Rights Act of 1964. The Act makes clear that “[d]iscrimination on the basis of pregnancy, childbirth or related medical conditions constitutes unlawful sex discrimination under Title VII.” The Act further states that “[w]omen affected by pregnancy or related conditions must be treated in the same manner as other applicants or employees with similar abilities or limitations.”

Recently, the Seventh Circuit in Hall v. Nalco interpreted the Act to apply to women who undergo infertility treatments. In that case, the plaintiff, Cheryl Hall, was allegedly discharged after requesting further time off to undergo vitro fertilization. In 2003, Ms. Hall underwent an embryo transfer. To ensure adequate time to recuperate, her physician recommended that she take time off after the procedure. Unfortunately, the embryo transfer failed, necessitating a second procedure. Despite receiving approval for a second leave of absence, Ms. Hall’s supervisors allegedly laid her off due to absenteeism associated with her infertility treatments.

If Ms. Hall had taken time off to give birth or prepare for her child’s birth, there would have been little question that her employer’s decision to terminate her employment violated The Pregnancy Discrimination Act of 1978. This case, however, hinged on Ms. Hall’s infertility treatment. Not surprisingly, the Seventh Circuit allowed Ms. Hall’s case to proceed forward to a jury trial, reasoning that infertility is not a gender-neutral condition:

Employees terminated for taking time off to undergo IVF—just like those terminated for taking time off to give birth or receive other pregnancy-related care—will always be women. This is necessarily so; IVF is one of several assisted reproductive technologies that involves a surgical impregnation procedure. Thus, contrary to the district court’s conclusion, Hall was terminated not for the gender-neutral condition of infertility, but rather for the gender-specific quality of childbearing capacity.

According to statistics published by the MayoClinic, estimates reveal that 10% to 15% of couples suffer from infertility, with female infertility accounting for 40% to 50%. The Seventh Circuit’s decision will no doubt benefit thousands of employees nationwide.

Age Discrimination in Employment Act (ADEA) Fails to Account for Emotional Distress Damages

Posted on by

The Age Discrimination in Employment Act (ADEA) and the Fair Employment Practices Act of Massachusetts prohibit employers from discriminating against workers 40 years old or older based on age. A key, often overlooked, difference between these two statutes exists. Unlike the Fair Employment Practices Act, employers that wrongfully discriminate against employees based on age are not responsible for compensatory damages for pain and suffering. The First Circuit in Collazo v. Nicholson recently held that such recovery is not available under the ADEA. In doing so, however, the court also noted Section 626(b)’s broad language allowing federal courts to award “such legal or equitable relief as may be appropriate to effectuate the purposes of the Act.”

Courts have interpreted Section 626(b)’s broad language to include such injunctive relief as reinstatement or promotion where necessary to effectuate the ADEA’s purpose. For whatever reason, courts continue to deny those who suffer discrimination the right to recover emotional distress damages under Section 626(b). Failing to consider the upheaval and devastation that can result from an unlawful termination constitutes a cramped interpretation of the statute.

Imagine that you just turned 55 years old. You have been with your company since graduating from college. Your son or daughter just entered college. Tuition is steep, but you’ve planned for this and feel ready. Your company recently appointed a bright, young CEO. During a staff meeting, the new CEO comments that the average age of employees at your company is 55. What the CEO says next is somewhat troubling: “We need young talent with fresh ideas.” Despite your stellar performance and the company’s well-known financial success, you find yourself terminated months later under the auspices of a re-organization.

For the first time in a very long time, your future is unclear. Despite your hard work and dedication, goals that you were poised to achieve are suddenly out of reach. You break the news to your child that s/he will need to transfer to a local university where the tuition is less expensive. Months pass with no comparable job offer. You and your spouse come to the realization that the mortgage payments are just too much. Relocation becomes necessary. The resulting financial turmoil has placed a great deal of stress on your marriage. You and your spouse begin to attend marriage counseling.

Unfortunately, the fact pattern described above is not uncommon. An Business Week article entitled Would We Fire Older Workers If We Could? paints an insightful picture of the uphill battle that older workers face. The emotional trauma that can result from age discrimination and losing one’s job is not far fetched. Section 626(b) explicitly calls for equitable relief. To effectuate the purpose of the ADEA, equitable relief should be interpreted to include compensatory damages for pain and suffering.

Handicap Discrimination Claim Succeeds Against Wal-Mart

Posted on by

Handicap discrimination claims continue to make headlines. Patrick Brady, who suffers from cerebral palsy, worked at Wal-Mart as a pharmacy assistant. In joining Wal-Mart, Brady brought with him two years of experience working at a local pharmacy. Despite being qualified, Brady’s supervisor stripped him of his pharmacy assistant functions and transferred him to the personnel department.

No longer a pharmacy assistant, Brady eventually resigned and filed suit against Wal-Mart for failing failing to participate in the interactive process and refusing to accommodate his disability. Amazingly, although plainly evident that Brady’s cerebral palsy impaired his motor skills, Wal-Mart argued that it had no obligation to accommodate his disability. As expected, the court disagreed. Indeed, while the burden generally lies with employees to inform the employer of the need for an accommodation, the burden shifts to the employer where the disability is obvious, as in Brady’s case:

[A] situation in which an employer perceives an employee to be disabled but the employee does not so perceive himself presents an even stronger case for mitigating the requirement that the employee seek accommodation. In such situations, the disability is obviously known to the employer, while the employee, because he does not consider himself to be disabled, is in no position to ask for an accommodation. A requirement that such an employee ask for accommodation would be tantamount to nullifying the statutory mandate of accommodation for one entire class of disabled (as that term is used in the ADA) employees. We therefore hold that an employer has a duty reasonably to accommodate an employee’s disability if the disability is obvious-which is to say, if the employer knew or reasonably should have known that the employee was disabled.

For more information, please visit the Second Circuit’s full opinion in Brady v. Wal-Mart

Age Discrimination Victims Gain Significant Victory Before Supreme Court

Posted on by

The Supreme Court in Meacham v. Knolls Atomic Power Labs issued a pro-employee decision that will make proving age discrimination under the Age Discrimination in Employment Act (ADEA) more practical. We blogged about this case in January 2008 when the Supreme Court first granted certiorari: Supreme Court Grants Certiorari in Retaliation and Age Discrimination Cases.

In Meacham, Knolls Atomic Power Labs terminated 31 employees, all but one of whom were 40 years old or older. The employees brought suit under the ADEA and prevailed before a jury. The Second Circuit overturned the verdicts, reasoning that the burden of proof rested with the workers. In its decision, the Supreme Court vacated the Second Circuit’s ruling, finding that Congress intended the burden of persuasion to fall with the employer.

To read more about the decision, please visit the New York Times article entitled, Supreme Court Eases Age Bias Suits for Workers.