“Burn Files” and Employee Self-Help: Effective Policies Protect Documents Wrongfully Taken by Former Employee

A New Jersey appellate court recently upheld the disqualification of a former employee’s attorneys in a whistleblower claim against his former employer, because the employee had improperly taken documents containing privileged attorney-client communications to use against the employer “when they try to get him.”

Facts

The defendant, Maquet Getinge Group (“Maquet”), a German pharmaceutical company, designs, develops, manufactures, and distributes medical devices.  Because of the medical and technological focus of defendant’s business, Maquest maintains sensitive research and development data, new products, quality processes and procedures and protocols for the preparation of inspections by the Food and Drug Administration (“FDA”) on its computer systems.  Maquet had in place comprehensive policies designed to protect its confidential, proprietary information, including a “Standards of Conduct” policy, an “End User Acceptable Use Policy.”  Plaintiff, Oscar Sanchez (“Sanchez”), was employed by Maquet as the Chief Quality and Compliance Officer for approximately 18 months, until he was terminated in April 2015.  As a condition of his employment, Sanchez and other similarly situated employees had to sign a “Confidential Information, Invention Assignment, and Non-Compete Agreement.”  This agreement contained, inter alia, a “Covenant Not to Disclose” and a provision on “Return of Company Documents.”  Two months prior to his termination, Sanchez was disciplined after an investigation into numerous complaints about his conduct and deportment involving employees who reported to him.  After receiving the complaints, Sanchez informed a Senior Vice President of Marketing at Maquet that “he had personally retained copies of all kinds of Maquet-owned documentation – which he referred to as his ‘burn files’ and which included copies of . . . two executives’ hard drives and a binder full of emails and documents,” which he allegedly told his co-worker he “would use the ‘burn files’ to “f***” Maquet ‘when they tried to get him.’”

On July 2, 2015, Sanchez filed a complaint against Maquet alleging he had been wrongfully terminated for whistleblowing activities, in violation of the Conscientious Employee Protection Act (“CEPA”).  Maquet served Sanchez with its First Request for the Production of Documents in October 2015, to which plaintiff responded on February 1, 2016.  Upon receipt of the documents, Maquet claimed the documents plaintiff’s counsel had produced were owned by Maquet and had been improperly taken by Sanchez without Maquet’s knowledge or consent. Further, Maquet claimed the documents produced contained privileged attorney-client communications between Maquet’s staff and its attorneys, including correspondence regarding FDA compliance issues, results of third-party audits, budgeting issues, research and development, quality processes and procedures, and FDA findings.

Lower Court Decision

Defendant moved to preclude plaintiff from using these documents against defendant, and to remove plaintiff’s chosen counsel and his firm from continuing to represent plaintiff in the case.  In its decision, the lower court rejected plaintiff’s argument that Maquet had waived the attorney-client privilege. The Judge then found that Plaintiff’s chosen counsel “knew or should have known the material was privileged” yet failed “to promptly notify the opposing side that they had received privileged information” until nine (9) months after the case had been initiated. In disqualifying chosen counsel from serving as plaintiff’s counsel, the Judge found he would neither be harmed in the prosecution of the case nor that he would be unable to secure competent substitute counsel, as the case was still in its early stages.

Appellate Court’s Decision

Sanchez appealed arguing that the motion judge erred in reaching her decision to disqualify his chosen counsel without conducting an evidentiary hearing and that the judge misapplied the multi-factor analysis the NJ Supreme Court established in the seminal case, Quinlan v. Curtiss-Wright Corp. The Appellate Division rejected these arguments and affirmed the lower court’s decision.

The Appellate Division concluded the motion judge properly found the documents in question to be covered by the attorney-client privilege, particularly finding that the motion judge had noted the documents in dispute contained communications between Sanchez, Maquet’s Global Chief Quality Assurance & Regulatory Officer, and Maquet’s General Counsel. The record also indicated the documents included emails labeled “ATTORNEY CLIENT PRIVILEGE” by plaintiff. The Appellate Division found no legal basis to question the motion judge’s conclusion that Maquet’s counsel was included in the communications to offer legal advice and guidance if he so chose.

The Appellate Division then rejected as untimely and legally unnecessary, plaintiff’s argument that the motion judge should have conducted an evidentiary hearing to consider the Quinlan factors.  Quinlan set forth seven (7) factors to consider when an employee may take or use documents belonging to his or her employer. The first consideration a judge must make is “how the employee came to have possession of, or access to, the document.” In reviewing the record, the court found that Sanchez removed the documents at issue in direct violation of Maquet’s policies related to confidential documents containing proprietary information in an act that was outside of his ordinary duties because he wanted to [get] the company when they tried to get him.  The court also noted that Sanchez copied the documents to share with his attorneys for the purpose of evaluating whether he had “a viable cause of action” against Maquet and conversely, that Maquet had a strong interest in keeping the materials confidential.

Finally, while recognizing that the disqualification of counsel is a harsh discretionary remedy that must be used sparingly, the Appellate Division concluded that Sanchez’ extra-judicial self-help measures deprived Maquet of the opportunity to prevent the disclosure of the privileged information and that plaintiff’s counsel’s unreasonable delay in disclosing this information rendered futile any attempt to mitigate this harm.

Bottom Line

Employers need to maintain robust policies related to maintaining and access to proprietary and confidential information, and in appropriate circumstances, agreements like those used by Maquet. These policies should: (1) set forth what materials are confidential or proprietary; (2) specify who within the company is permitted access to the proprietary and confidential information, whether by job title, level, need to know basis, etc.; and (3) set forth the purpose for which the employee is granted access and any limitations on access to the proprietary and confidential information. These policies and agreements will be critical in allowing a court to determine the employee was unauthorized in taking the documents and acted outside their ordinary duties of employment.

For more information about the potential impacts of this ruling or what steps your company can take to effectively prevent and address whistleblower complaints, please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullgenovaburns.com, or Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com, or 973-533-0777.

Welcome to The Garden State: NJ’s Law Against Discrimination Grows to Protect Non-Resident Employees

A New Jersey appellate court recently held that a non-resident employee who telecommuted to her New Jersey employer from her home in Massachusetts may be covered by the New Jersey Law Against Discrimination (NJLAD).

Facts

The employer, Legal Cost Control, Inc. (LCC), was a corporation located in Haddonfield, New Jersey.  The employee, Susan Trevejo, lived in Massachusetts, paid property taxes in Massachusetts, and held a Massachusetts driver’s license.  She never lived in New Jersey, and she never worked in LCC’s New Jersey office.  Trevejo received health insurance benefits from LCC’s insurance provider, Amerihealth New Jersey, but the plan did not condition coverage on New Jersey residency.  Trevejo’s sole connection to New Jersey was using a company-issued computer to remotely connect to LCC’s network and a company-issued phone to engage in conference calls.  After twelve years with the company, LCC terminated Trevejo’s employment.  In turn, she filed a lawsuit alleging age discrimination in violation of the NJLAD.

Lower Court’s Decision

LCC moved to dismiss the case, arguing that Trevejo was not an “inhabitant” of New Jersey, and thus, could not pursue a claim under NJLAD.  The trial court allowed for limited discovery over whether Trevejo was an “inhabitant” of New Jersey; the parties were barred from engaging in discovery over Trevejo’s other connections to the state.  The trial court ultimately dismissed the case, finding that Trevejo was not an “inhabitant” of New Jersey covered by NJLAD.

Appellate Court’s Decision

Trevejo appealed, arguing that the trial court overly restricted discovery and that she needed to engage in discovery regarding the nature and substance of her daily “virtual” connection to LCC’s New Jersey office.  The Appellate Division agreed, reversing the trial court’s decision and sending the case back to the trial court for more discovery.

In deciding that NJLAD’s coverage is not limited to inhabitants of New Jersey, the Appellate Division relied on the text of NJLAD itself.  The statute expressly prohibits discrimination against “any individual” and repeatedly uses the term “person” to identify who is protected from discrimination.  The term “person” is used throughout the statute, whereas the word “inhabitant” appears only in the legislation’s preamble.  Accordingly, the court concluded that NJLAD’s coverage is not limited to inhabitants of New Jersey.  This was, as the Appellate Division reasoned, consistent with the overarching goal and strong public policy behind NJLAD, to eradicate discrimination from the workplace entirely.  The trial court’s restricting discovery to whether Trevejo was a New Jersey inhabitant could not be reconciled with that principle.

Rather than Trevejo’s place of residency, the Appellate Division directed that discovery focus on where the discriminatory conduct took place and whether Trevejo was employed in New Jersey or Massachusetts.  The scope of discovery should extend to:

  • Where plaintiff’s co-employees worked;
  • Whether those co-employees worked from home;
  • The nature of the software used by plaintiff and other LCC employees to conduct business on behalf of LCC;
  • The location of the server used to connect plaintiff and other employees to LCC’s office in New Jersey;
  • The location of the internet service provider allowing plaintiff and other employees to connect to LCC’s office in New Jersey;
  • The individual or individuals who made the decision to terminate plaintiff and the basis for the decision; and
  • Any other issues relevant to plaintiff’s contacts with New Jersey and her work for LLC that may demonstrate her entitlement to protection under the NJLAD.

Facts Matter

The New Jersey Appellate Division has consistently applied this type of fact-sensitive approach to deciding whether non-resident telecommuters are covered by New Jersey laws, even outside the discrimination context.  But this fact-sensitive approach often produces seemingly inconsistent results.  For example, in one case, an employee who telecommuted to her New Jersey employer from her home in North Carolina was denied New Jersey unemployment benefits based on a finding that she performed all of her work in North Carolina.  This seems to contradict the holding in Trevejo’s case, where the court was unconvinced by the fact that Trevejo performed all of her work in Massachusetts.  As if you were not already confused enough by the muddle of laws and regulations governing the workplace, this case illustrates the importance of facts, rather than bright line rules, in making decisions about your employees.

Bottom Line

Beware that all of your employees, regardless of where they perform their work, may be entitled to claim protection from discrimination under NJLAD.  The issue will come down to a factual inquiry over whether they have sufficient contacts with the state.  Be mindful that NJLAD is one of the most employee-protective state anti-discrimination statutes in the country.  In light of that fact, and the absence of any bright line rule regarding NJLAD’s applicability to out-of-state employees, you may want to consider executing, where available by law, a written agreement with your non-resident telecommuters delineating which state’s law applies in the event of a legal dispute (“choice of law” clause), and in which court those disputes are to be filed (“forum selection” clause).

For more information about the potential impacts of this ruling or what steps your company can take to effectively prevent and address complaints of discrimination, please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullgenovaburns.com, or Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com, or 973-533-0777.

New Jersey Passes Mandatory Paid Sick Leave

On May 2, New Jersey Governor Phil Murphy signed a law mandating all private and public New Jersey employers, regardless of size, offer paid sick leave. This makes New Jersey the 10th state to adopt mandatory paid sick leave legislation. The Paid Sick Leave Act (“the Act”) also permits employees to use the leave for their own care or for the care of a family member and expands how paid sick leave can be used, encompassing protections beyond the federal Family Leave and Medical Act, the New Jersey Family Leave Act as well as other leave laws. The new law also fully pre-empts the 13 municipalities in New Jersey with local paid sick leave ordinances, allowing employers to adopt a state-wide uniform paid sick leave policy.

Coverage

Permissible use of sick leave includes the following:

(i) Diagnosis, care, treatment, recovery and/or preventive care for the employee’s own mental or physical illness or injury or the employee’s family member’s mental or physical illness or injury;

(ii) Absence due to a public health emergency declared by a public official that causes the closure of the employee’s workplace or the school or childcare facility of the employee’s child or requires the employee or an employee’s family member to seek care;

(iii) A necessary absence for medical, legal or other victim services because of domestic or sexual violence perpetrated on the employee or the employee’s family member; or

(iv) To attend a school-conferences, meetings, or any event requested or required by a child’s school administrator, teacher, or other professional staff member responsible for the child’s education, or to attend a meeting regarding a child’s health or disability.

The Act also broadly defines “family members” to include an employee’s child, spouse, domestic partner, civil union partner, parent (including adoptive, foster or step-parent, or legal guardian), sibling (including foster or adoptive siblings), grandparent or grandchild, and the parent, grandparent or sibling of the employee’s spouse, domestic partner or civil union partner. Notably, an employee has the opportunity to use their sick leave for the care of a non-related individual whose close association with the employee is the “equivalent” of a family relationship.

Exemptions & Employees Covered by a CBA

Per diem healthcare employees, construction workers subject to a collective bargaining agreement (CBA), and public employees who are provided with sick leave with full payment pursuant to any other law, rule or regulation are exempt from the new law. Non-construction employees covered by a CBA at the time the law goes into effect are also not effect, but will apply once the agreement expires. Further, employees and their representatives may waive the rights available under the law and address paid leave in collective bargaining.

Accrual of Paid Sick Leave

Under the new law, employees accrue 1 hour of paid sick leave for every 30 hours worked. Employees may accrue up to 40 hours of paid sick leave per benefit year.  Employers are also permitted to designate the “benefit year” as any 12-month period but may not modify it without notifying the New Jersey Department of Labor and Workforce Development (NJDOL).

Employees become eligible to use earned sick leave beginning on the 120th day after they are hired, and may use their earned sick leave as it is accrued. Employers are also permitted to offer, or “frontload” 40 hours of paid sick time or utilize a paid-time-off (“PTO”) policy as long as it provides equal or greater benefits and accrue benefits at an equal or greater rate than the benefits provided under the Act. There is no requirement to payout accrued and unused sick leave upon termination absent a company policy to the contrary.

Upon the mutual consent of the employee and employer, an employee may voluntarily choose to work additional hours or shifts during the same or following pay period, in lieu of hours or shifts missed, but shall not be required to work additional hours or shifts or use accrued earned sick leave. In addition, an employer may not require, as a condition of an employee’s using earned sick leave, that the employee search for or find a replacement worker to cover the hours during which the employee is using earned sick leave.

Notice

Employers are entitled to 7 days advance notice of “foreseeable” absences and can restrict employee’s use of “foreseeable” paid sick leave on certain dates.  Where the need is unforeseeable, an employer may only require notice “as soon as practicable,” if the employer has notified the employee of this requirement.  In addition, employers are only permitted to ask the employee for documentation to substantiate the sick leave if the employee is absent for 3 or more consecutive days.

Compliance

Employers will be required to maintain records documenting the hours worked and earned sick leave used by employees. Records must be maintained for 5 years and made available for inspection by the NJDOL. If an employee claims an employer violated the Act, and that employer that has failed to maintain adequate records, then there is a presumption that the employer failed to provide paid sick leave.

Employers must also post a notification and distribute a written notification alerting employees of their rights within 30 days of the notice being issued by the NJDOL and provide the notification to all new employees at the time of hiring.

Anti-Retaliation

Employers are prohibited from retaliating or discriminating against employees under the Act. The Act broadly defines retaliation to include not only retaliatory personnel action like suspension, demotion, or refusal to promote, but also includes threatening to report the immigrant status of an employee or family member of the employee. Employers are also prohibited from retaliating or discriminating against an employee who files a complaint with the commissioner or a court alleging the employer’s violation of the Act, or informs any other person of their rights under the Act.

There is a rebuttable presumption of unlawful retaliatory action whenever an employer takes adverse action against an employee within 90 days of when that employee opposes any violation of the Act, informs any person about the employer’s alleged violation of the Act, files a complaint alleging a violation of the Act, or cooperates in an investigation into an alleged violation of the Act.

Penalties

Any failure of an employer to make available or pay earned sick leave as required by the new law, or any other violation of the law, shall be regarded as a failure to meet the wage payment requirements of the New Jersey Wage and Hour Law.  Employers will also be subject to the penalties and remedies contained in the New Jersey Wage and Hour Law, including fines and possible imprisonment, reinstatement of a discharged employee to correct any discriminatory action and payment of all lost wages in full.

Bottom Line

The New Jersey Paid Sick Leave Act takes effect in 180 days, on October 29, 2018. Employers in New Jersey, in consultation with legal counsel, must review and revise existing policies, practices and procedures related to calculating employee’s sick leave to ensure compliance with the Act.  Human Resources and Benefits personnel should also be trained on the new paid sick leave law requirements and Managers should also receive updated training to ensure that internal recordkeeping processes are sufficient to keep track of time taken under the new law.

For more information about the potential impacts of the Paid Sick Leave Act or what steps your company can take to effectively ensure compliance with wage and hour laws, please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullgenovaburns.com, or Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com, or 973-533-0777.

New Jersey Takes the Lead in Equal Pay Act Legislation

Following up on his January 16, 2018 Executive Order promoting equal pay for equal work, New Jersey Governor Phil Murphy signed a historic and sweeping equal pay law on April 24, 2018. The “Diane B. Allen Equal Pay Act” was named after former Republican Senator Diane B. Allen, herself a victim of bias, who was part of the original negotiations surrounding the bill when it was first proposed under former Governor Chris Christie. The new Equal Pay Act applies to all employers in New Jersey regardless of size and is scheduled to take effect on July 1, 2018. The new law combats not only gender pay discrimination but also wage discrimination against those protected by the New Jersey Law Against Discrimination (NJLAD).

Coverage

The Equal Pay Act amends the NJLAD and now makes it illegal for an employer to pay any employees who are members of a protected class recognized under the NJLAD at a lower compensation than other employees who are not members of a protected class, for “substantially similar work,” unless a pay differential is justified by legitimate business necessity. Under the NJLAD, protected classes include race, creed, sex, color, national origin, ancestry, nationality, disability, age, pregnancy or breastfeeding, marital, civil union or domestic partnership status, affectional or sexual orientation, gender identity or expression, military status, and genetic information or atypical hereditary cellular or blood traits. “Substantially similar work” is determined by a combination of the “skill, effort and responsibility” required for that position and is not limited to employees who work within a specific geographic area or region.

Moreover, although the legislation carves out an exception for differential pay based on certain factors like merit, seniority, and education, this exception is only so long as these factors do not perpetuate a sex-based differential in compensation. For example, if one employee has a different title than another employee or even works in a different department, but both employees perform the same types of tasks with similar levels of responsibility, both employees should be paid the same.

An employer may pay a different rate of compensation only if the employer demonstrates that the differential is made pursuant to a seniority system, a merit system, or the employer demonstrates:

  • The differential is based on one or more legitimate, bona fide factors other than the characteristics of members of the protected class (like training, education, experience, or the quantity or quality of production);
  • The factors are not based on, and do not perpetuate, a differential in compensation based on sex or any other characteristic protected under the NJLAD;
  • Each of the factors must be applied reasonably;
  • One or more factors account for the entire wage differential; and
  • The factors are job-related with respect to the position in question and based on a legitimate business necessity.

Prohibitions

The new law also makes it easier for employees to win pay-discrimination cases since all they would need to show is that they were paid unequally for “substantially similar” work, rather than the previous standard of “substantially equal” work. Employers are also not permitted to reduce the rate of compensation of any employee in order to achieve compliance.

The new law also prohibits employers from retaliating against employees who (1) oppose any practices or acts forbidden under the Act; (2) seek legal advice regarding rights under the Act; (3) share relevant information with legal counsel or a governmental entity; or (4) file a complaint, testifies or assists in any proceeding.  The Act also forbids coercion, intimidation, threats or interference with any person in the exercise or enjoyment of, or on account of that person having aided or encouraged any other person in the exercise or enjoyment of, any right granted or protected by the Act.

Statute of Limitations

In addition to any other relief authorized by the NJLAD, liability under the new law shall accrue, and an aggrieved person may obtain relief for back pay, for up to 6 years, so long as the violations continue within the 6-year period. The law also makes it unlawful to require employees or prospective employees to consent to a shortened statute of limitations or to waive any of the protections afforded under the NJLAD.

Available Damages

In addition to the damages permitted under the NJLAD, the new law allows victims of discrimination to recover triple damages should a jury, or the New Jersey Division of Civil Rights, determine that the employer is guilty of an unlawful employment practice as defined by the law.

Reporting Obligations

To ensure companies doing business with the state comply, companies that win contracts from public agencies are required to submit reports to the Commissioner of Labor and Workforce Development. These reports would need to include the gender and race of employees in every job title or pay band, and the total compensation for each category of employees.

Bottom Line

Employers should carefully analyze their existing pay practices to ensure compliance. Prior to July 1, 2018, employers must review the current job descriptions, employee handbooks and policies to determine which employees perform “substantially similar work” in order to ensure they are being compensated at the same rate. If, after doing this review, there is a pay differential, the employer must be able to show that the difference is not based on sex or any other characteristic of members of a protected class. Existing handbooks and policies must also be revised to prohibit pay discrimination for substantially similar work, and prohibit retaliation against employees who request, discuss or disclose compensation or other job-related information covered by the law. Human resources and benefits personnel should also be trained on the new requirements and managers should also receive updated training.

Employers must also be aware that the provision for back pay damages is much more extensive than federal law, and the possibility of treble damages should a jury find that an employer is guilty of an unlawful employment practice should serve as a powerful deterrent to correct discriminatory pay differentials.  Lastly, employers who work with public entities must ensure that payroll records and other information regarding the “gender, race, job title, occupational category and rate of compensation” of every employee that is part of the project is up to date and sent to the public entity.

For more information regarding the impacts of this legislation and how to implement nondiscriminatory pay practices, please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullgenovaburns.com, or Dina M. Mastellone, Esq., Director of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com or 973-533-0777.

New York City Employers Will Soon Be Required To Approve Work Schedule Changes At Their Employees’ Request

On December 19, 2017, the New York City Council passed a bill requiring employers to grant employee requests for “temporary changes” to work schedules for “personal events.”  This bill takes effect on July 18, 2018.

What qualifies as a “personal event” triggering a mandatory schedule change? – “Personal events” requiring a schedule change include:

  • When the employee is a caregiver who provides direct and ongoing care to a “care recipient,” and needs a temporary schedule change to provide this care. A “care recipient” under the bill is defined as a minor child or a disabled family or household member who relies on the employee for medical care or to meet the needs of daily living;
  • When the employee needs the temporary schedule change to attend a legal proceeding or a hearing for government assistance benefits, to which the employee, the employee’s family member or a “care recipient” is a party; or
  • Circumstances that qualify for sick time use under the New York City’s Earned Sick Time Act.

How many “temporary changes” are employees entitled to? – Eligible employees are entitled to two “temporary changes” to their work schedules in a calendar year, for up to one business day per request.  The employer may allow the employee to use two business days for one request, in which case it need not grant a second request.

What constitutes a “temporary change”? – A “temporary change” is defined as “a limited alteration in the hours or times that or locations where an employee is expected to work.”  A temporary change can include paid or unpaid time off, working from home, or changing work hours.

Who is eligible? – All non-government employees who work full time or part time within New York City for 80 or more hours per calendar year, and who have worked for the employer for more than 120 days.

Who is not eligible?

  • Employees covered by a collective bargaining agreement that expressly waives the provisions of the bill and addresses temporary work schedule changes; and/or
  • Certain employees whose jobs and whose employer’s primary business involves the development, creation or distribution of movies, TV programs or live entertainment presentations. Exceptions to this category apply.

What are the employee’s notice requirements? – To properly request a “temporary change” to his or her work schedule, an eligible employee must:

  • Notify his employer or direct supervisor immediately upon learning of the employee’s need for the change;
  • Propose a temporary change, unless the employee seeks unpaid leave; and
  • Reduce his notification and proposal (if required) to writing no later than the second business day after he returns to work. The employer may permit the employee to satisfy this writing requirement by any electronic means (g., email or text message) commonly used by employees to request and manage time off or schedule changes.

What are the employer’s obligations? The employer must respond immediately to a request for a temporary schedule change by indicating:

  • Whether the employer will grant the proposed temporary change, or, alternatively, will grant the change as unpaid leave;
  • The reason for denying the request; and
  • How many temporary change requests and business days to fulfill such requests the employee has left in the calendar year.

The employer’s response must be reduced to writing no later than 14 days following the request.

How does NYC’s temporary work schedule change bill interact with the New York City Earned Sick Time Act? – The New York City Earned Sick Time Act generally provides employees up to 40 hours of paid sick leave per calendar year.  Employees who are eligible for a temporary work schedule change under this bill need not exhaust their earned paid sick time before requesting such changes. In addition, any unpaid leave granted for personal events under this bill does not count toward the obligation to provide earned paid sick leave pursuant to the Earned Sick Time Act.

For more information about how this new bill affects your company or how your company can effectively implement it into its existing practices and procedures, please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullgenovaburns.com, or Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com, or 973-533-0777.

NYS Attorney General Issues Guidance on Preventing & Correcting Sexual Harassment in the Workplace

On December 6, 2017, amidst the recent barrage of publicized sexual harassment and sexual assault allegations made against various news organizations, politicians, and Hollywood elite, New York State Attorney General Eric T. Schneiderman released “Know Your Rights” guidance on sexual harassment in the workplace.  The purpose of the guidance is to inform New Yorkers about the laws that protect them from sexual harassment at work and to provide victims of sexual harassment with information on the appropriate agencies to consult should they seek to file a complaint or take legal action, along with helplines for further support.  The guidance highlights the following:

Sexual Harassment Defined – Sexual harassment occurs when unwelcome conduct of a sexual nature is used as the basis for making employment decisions, like hiring or firing, or is so frequent or severe that it creates an intimidating, hostile, or offensive work environment.

  • The conduct can be verbal, visual and/or physical, such as unsolicited sexual advances, sexually offensive remarks or jokes, comments about a person’s gender or sexual orientation or preferences, unwanted touching, and sexually suggestive gestures.
  • Sexual harassment can be committed by a supervisor, co-worker, or third-party vendor/customer/client who comes into the workplace.
  • Protections apply to both men and women, and same sex harassment is prohibited, regardless of sexual orientation.

Avenues of Relief – Laws prohibiting sexual harassment include Title VII of the Civil Rights Act (“Title VII”), the New York State Human Rights Law (“NYSHRL”), and the New York City Human Rights Law (“NYCHRL”).  The scope and procedure for filing complaints differ under each law.

  • Those who feel they have been the victim of, or who have observed sexual harassment should first report it to his/her employer pursuant to the employer’s internal policies. Individuals may also consult an attorney to determine whether to file a complaint with a government agency or a lawsuit in state or federal court.
  • Agencies who handle sexual harassment complaints include the New York State Office of the Attorney General Civil Rights Bureau (“OAG”), the New York State Division of Human Rights (“NYSDHR”), and the Equal Employment Opportunity Commission (“EEOC”).
    • The OAG represents the People of New York (not the individual complaining party) when it discovers evidence of a pattern, practice, or policy of sexual harassment.
    • The NYSHRL allows individuals to file a complaint against employers of any size with the NYSDHR or proceed directly to court.
    • Sexual harassment complaints under Title VII may only be brought against employers with more than 15 employees and must be filed first with the EEOC before commencing a lawsuit.

No Retaliation – The law also prohibits retaliation against anyone who has filed a complaint about sexual harassment in the workplace.

Criminal Liability – Sexual harassment may constitute a crime, under theories of stalking and/or assault.

Sexual harassment in the workplace is a serious problem that affects many employees and organizations.  As stated by A.G. Schneiderman, “We all have a stake in preventing [sexual harassment] and stopping it when it happens.”  Addressing sexual harassment in the workplace provides a benefit to employees and employers alike.  Employees have a right to feel secure in the workplace, and employers can have liability in situations where harassing behaviors is permitted whether by supervisors, subordinates, peers, customers, vendors, and contractors. Employers can reduce the risks of claims of sexual harassment in the workplace by arming its employees with tools to deal with inappropriate workplace behavior and sexual harassment allegations.  This includes a well-crafted sexual harassment prevention and complaint policy and routine training for managers and supervisors.

For more information about how anti-harassment laws affect your company or how your company can effectively prevent and address complaints of sexual harassment, please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullgenovaburns.com, or Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com, or 973-533-0777.

Christie Vetoes Expansion of New Jersey Family Leave & Increased Minimum Wage

On July 21, 2017, New Jersey Governor Chris Christie conditionally vetoed two bills that would have expanded New Jersey’s pioneering paid Family Leave Act and raised minimum wage for certain transportation center service workers.  Under the New Jersey Family Leave Act (NJFLA), which applies to New Jersey companies with 50 or more employees, workers are eligible to receive up to 12 weeks of continuous leave during a given 24-month period to care for a newly born or adopted child, parent, a child under 18, spouse, or civil union partner who has a serious health condition requiring in-patient care, continuing medical treatment or medical supervision.  The leave is partially paid, and eligible employees can generally receive up to $633 per week.

The Bill (A4927) would have extended the NJFLA’s coverage to employers with 20 or more employees and expanded the definition of “family member” to include siblings, grandparents, grandchildren and parents-in-law.  Moreover, the Bill would have doubled the maximum number of weeks of family temporary disability leave benefits from 6 weeks to 12 weeks, increased available intermittent leave from 42 days to 84 days, and raised the weekly cap on paid benefits to $932, depending on the claimant’s income.

Governor Christie denounced the Bill’s supporters as disregarding the increased cost to taxpayers and the potentially adverse impact the bill would have on small businesses in New Jersey.

The minimum wage bill (A4870) would have significantly raised New Jersey’s minimum wage for employees at Newark Liberty International Airport, Newark Penn Station, and the Hoboken Terminal, from $10.10 to $17.98 per hour.  Incidentally, Christie vetoed a bill last year that would have raised New Jersey’s minimum wage from its current $8.44 to $15.00 per hour.  The New Jersey Business & Industry Association, considering the vetoes to be a victory to New Jersey employers, stated that the minimum wage bill would have set “a terrible precedent by circumventing the collective bargaining process and imposing backdoor wage and benefit increases by statute.”

For more information on these vetoes and current laws regarding family leave, minimum wage, or other applicable leave laws, please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullnullgenovaburns.com, or Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullnullgenovaburns.com, or 973-533-0777.

New York City Seeks to Ban Employer Inquiries Into Applicants’ Salary History

On April 5, 2017, the New York City Council passed a law amending the New York City Human Rights Law, barring all public and private New York City employers from asking job applicants about their prior wages and salary history.  The bill has been sent to Mayor DeBlasio for signature.  This new proposed law will take effect 180 days after Mayor DeBlasio signs it.

This bill would prohibit New York City employers from:

  • Making an inquiry, either verbally or in writing, to an applicant and/or the applicant’s current or prior employer, to obtain the applicant’s salary history;
  • Searching public records for an applicant’s salary history; and/or
  • Relying on a job applicant’s salary history when making an offer of employment or extending an employment contract to the applicant.

Salary history is broadly defined in the bill as the applicant’s “current or prior wage, benefits or other compensation.”  However, salary history inquiries do not include inquiries into the objective measure of the applicant’s productivity, for example, through inquiries on revenue, sales, or production reports.  Further, employers may still discuss the applicant’s salary and benefits expectations, including the amount of unvested equity and deferred compensation an applicant would forfeit through resignation from his or her current employment.

The bill contains several other exceptions to the prohibition on salary inquiries, which include the following:

  • Employers can consider and verify an applicant’s salary history if the applicant discloses the information voluntarily and without prompting;
  • Where federal, state, or local law specifically authorizes the disclosure or verification of salary history;
  • Where salary is determined by procedures in a collective bargaining agreement;
  • When current employees are transferred or promoted within the company; and
  • When a background check for non-salary related information inadvertently discloses salary history, provided the employer does not rely on that information in making an offer of employment.

The New York City’s Commission on Human Rights (NYCCHR) will be responsible for investigating complaints and enforcing the new law.  The NYCCHR will also have the authority to impose fines ranging from up to $125 for intentional violations and up to $250,000 for intentional malicious violations.

If Mayor DeBlasio signs this law, employers must immediately update their employment applications and train their recruiters and human resources personnel on the new requirements.  Employers may also be forced to limit the scope of their background checks and revise their notices under the Fair Credit Reporting Act.  For questions on this new proposed law, background check laws, or other employment and hiring requirements, please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullgenovaburns.com, or Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com, or 973-533-0777.

Second, Eleventh and Seventh Circuits Disagree Whether Title VII Extends to Claims of Sexual Orientation Discrimination

On March 27 the Second Circuit held that Title VII does not provide protection against workplace discrimination based on sexual orientation. In Christiansen v. Omnicom Group Inc., the plaintiff alleged that his employer discharged him because of his sexual orientation and his nonconformity to gender stereotypes.  On appeal to the Second Circuit, the employer sought dismissal of the claims, and argued that claims of sexual orientation discrimination cannot be brought under Title VII.  Plaintiff urged the court to expand Title VII’s scope to reach these claims and, alternatively, that his suit claimed sexual stereotyping, as opposed to sexual orientation discrimination.  The Second Circuit held that it was bound by Second Circuit precedent in this regard and the plaintiff could not state a cognizable claim for sexual orientation discrimination under Title VII.  The Christensen court relied heavily on the Second Circuit’s 2000 decision in Simonton v. Runyon where the court held that Title VII does not prohibit sexual orientation discrimination.

The Christensen court observed that the landscape of sexual orientation and the law have changed significantly since Simonton.  Most notably, in 2013, the Supreme Court struck down the Defense of Marriage Act and in 2015, held that same-sex couples have the right to marry.  However, the Christensen court found that neither of these decisions relates to Title VII protections, but instead they reflect a change in social and judicial perceptions regarding protections for same-sex couples.

The Eleventh Circuit is in agreement with the Second Circuit.  However, on April 4 the Seventh Circuit en banc held that sexual orientation discrimination is cognizable under Title VII. Hively v. Ivy Tech Comm. College. The Seventh Circuit reversed a Circuit panel that found for the employer with reasoning consistent with the Christiansen decision. The EEOC’s enforcement position during the Obama Administration was that discrimination based on sexual orientation is prohibited by Title VII, although it remains to be seen whether this will change under the current administration.

Given the split in the Circuits and the rapid development of the law in this area, employers cannot ignore discrimination or harassment claims based on sexual orientation.  Several jurisdictions already have state and local laws that prohibit these workplace behaviors, including New Jersey, New York, and New York City.  Employers must review their anti-harassment and discrimination policies to ensure compliance not only with Title VII but also with state and local laws, and promptly and effectively respond to complaints of unlawful harassment and discrimination.

For more information on this decision, on the applicability of Title VII to your organization, or to ensure compliant employment practices, please contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullgenovaburns.com, or Dina M. Mastellone, Esq., Chair of the firm’s Human Resources Practice Group, at dmastellone@nullgenovaburns.com, or 973-533-0777.

Two Federal Courts Dismiss ADA Website Accessibility Claims

In the last two months, at least two federal district courts have dismissed website accessibility lawsuits filed against private companies under the Americans with Disabilities Act (“ADA”), proving that this issue continues to be the Achilles Heel of the Department of Justice’s (“DOJ”) Regulatory Arena.

For context, imagine a blind person who is unable to make online mortgage payments because his bank’s website did not provide him the means.  The DOJ is tasked with enforcing the ADA, a federal statute that provides for equal access to places of public accommodation, including private businesses, for such persons with disabilities.  However, the text of the ADA is silent about public accommodations’ websites, and a recent executive order aimed at decreasing federal regulations has all but eliminated any chance that the DOJ will issue regulations on that topic.  The absence of such regulations has emboldened disability advocacy groups across the nation to flood the courts with lawsuits against companies alleging a failure to provide equal access to audio, audiovisual, or other content made available online.

Not so fast, said the U.S. District Court for the Central District of California.  On March 20, 2017, in the case of Robles v. Domino’s Pizza LLC, No. 16-06599, the federal court dismissed ADA web accessibility litigation brought against the enormous food retailer, Domino’s.  The court relied on the “primary jurisdiction doctrine,” which allows courts to dismiss complaints pending the resolution of an issue that is “within the special competence of an administrative agency.”  Noting that Congress has vested exclusive authority with the DOJ to promulgate regulations defining what web accessibility standards to impose on private companies, the court concluded that it was inappropriate to render judgment against Domino’s in the absence of such regulations.

There are various other legal issues that arise in ADA web accessibility cases, including the concept of standing, which means having a concrete injury that can be rectified by a court order, and whether a website is a place of public accommodation.  The U.S. District Court for the Southern District of Florida, in the case of Gomez v. Bang & Olfusen America, Inc., No. 16-23801, shed light on both issues.  The Gomez court dismissed an ADA web accessibility claim brought by a plaintiff who contended that the company’s website could hypothetically impede a blind person from enjoying all the benefits of the company’s retail stores on the basis that the plaintiff did not have a particularized injury (i.e., standing).  As the court concluded, “[h]is generalized grievances are wholly unconnected to any harm he actually suffered at the place of public accommodation (i.e. the concrete, physical store) and are therefore insufficient to survive a motion to dismiss.”  The court also recognized that websites are not included in the ADA’s express list of public accommodations: “If Congress – recognizing that the internet is an integral part of modern society – wishes to amend the ADA to define a website as a place of public accommodation, it may do so.  But the Court, having no legislative power, cannot create law where none exist.”

Although these cases may suggest a shield to ADA web accessibility litigation, there are just as many courts across the country taking completely opposite views.  For example, only one year ago, a Massachusetts federal court rejected the “primary jurisdiction doctrine” (relied upon in Robles) as a basis to dismiss ADA web accessibility claims made against Harvard University and the Massachusetts Institute of Technology.  See Nat’l Ass’n of the Deaf, et al., v. Harvard Univ., et al., No. 15-30023; Nat’l Ass’n of the Deaf, et al. v. Massachusetts Inst. of Tech., No. 15-30024.  Given the national split over these issues and the unlikelihood that the DOJ will issue clarifying regulations, businesses should be cautious.

The first step a business should take to minimize the risk of expensive litigation and exhausting DOJ investigations is to designate an ADA coordinator/compliance group to audit its website.  Companies should simultaneously work with counsel so that reports and findings from these audits are generated under privilege.  In addition, companies should adopt strong website accessibility polices and staff training materials.  Moreover, one of the most effective ways to stave off litigation is to provide a customer service, like a hotline, devoted to assisting customers who encounter difficulties in accessing a company’s web content.

Those with questions about these emerging issues or looking for a preliminary assessment of their legal exposure under the ADA should contact John C. Petrella, Esq., Chair of the firm’s Employment Litigation Practice Group, at jpetrella@nullgenovaburns.com, or Brigette N. Eagan, Esq., Counsel with the firm’s Human Resources Practice Group, at beagan@nullgenovaburns.com or 973-533-0777.