ACHRA - Employment Law Update August 23, 2011

1. ACHRA - Employment Law Update August 23, 2011 Presented By: Sarah H. Roane and William B. Warihay Ogletree, Deakins, Nash, Smoak & Stewart (Greensboro) 336.375.9737 Sarah.Roane@ogletreedeakins.com William.Warihay@ogletreedeakins.com

2. What’s new in 2011? • Genetic Information Nondiscrimination Act (GINA) EEOC regulations become effective • Recent U.S. Supreme Court Decisions • Thompson v. North AmericanStainless – Title VII retaliation • Staub v. Proctor Hospital – “Cat’s Paw” Liability • Kasten v. Saint-Gobain Performance Plastics – FLSA retaliation • Recent 4th Circuit Decision • EEOC v. Cromer Food Services • ADA Amendments Act • Social Media Legal Issues in Employment

3. TOPIC #1: GINA REGULATIONS

4. GINA Regulations • Title I applies to group health plans and insurers • Regulations implementing Title II of the Genetic Information Nondiscrimination Act (GINA) took effect January 10, 2011 • Title II of GINA prohibits employers from: • Using genetic information in making employment decisions • Harassing/ retaliating against employees based on genetic information • Disclosing genetic information about applicants or employees

5. WHO IS COVERED BY GINA? • Covered Employers • Applies to employers who employ 15 or more employees for each working day in each of 20 or more calendar weeks in the current or preceding calendar year • EEOC believes there is no individual liability under Title II • Employee includes “former employee” • E.g. Disclosure of former employee’s genetic information to a prospective employer

6. What is “Genetic Information”? • Genetic information • Individual’s genetic tests • Family member’s genetic tests • Manifestation of disease or disorder of family member (family member’s medical history) • Receipt of genetic services • Does not include individual’s health history or current diagnosis. • Does not include age or gender. • “Family members” – includes any dependents and relatives to the “fourth degree” (i.e. Great-Great Grandparents) • Including unborn fetuses or embryos.

7. GINA (cont’d) • Title II of GINA even prohibits employers from simply acquiring employee genetic information unless an exception applies.

8. ACQUISITION OF GENETIC INFORMATION • Prohibition: Unlawful to request, require or purchase genetic information of an individual or family member • EEOC rejected “deliberate acquisition” position • “Request” includes conduct likely to result in obtaining genetic information: • Conducting Internet search • Active listening to conversations of others • Making requests for information about an individual’s current health status

9. GINA Procedures • Title II of GINA requires an employer to keep any genetic information it acquires confidential, which includes maintaining any written genetic information in a file separate from an employee’s personnel records. • However, genetic information may be kept in the same file as other medical information in compliance with the Americans with Disabilities Act.

10. What are the exceptions? • Common exceptions include: • The information is acquired inadvertently; • The information is acquired as part of health or genetic services provided on a "voluntary" basis, including a "voluntary" wellness program; • The information is acquired in order to comply with FMLA certification requirements, state or local leave law, or certain employer leave policies.

11. Exceptions Examined - Requests • Covers Employers that inadvertently acquire genetic information pursuant to lawful requests for medical information. • To assist employers in meeting this exception – the final regulations offer specific language to use on any lawful forms or requests. • Example: Overbroad responses

12. Exceptions Examined – “Water Cooler” • Congress was concerned that casual conversation between co-workers regarding health could unnecessarily lead to litigation. • Final regulations – Employer will not violate GINA where a manager or supervisor overhears a conversation about genetic information between the individual and others, or hears it directly through casual conversation. • Regulations warn: If the supervisor probes further with individual questions likely to result in the receipt of genetic information – exception no longer applies.

13. Exceptions Examined – Social Media • Employer will not be liable under GINA where a manager or supervisor inadvertently learns of genetic information from a social media platform to which he or she was given access by the creator of the profile.

14. Exceptions Examined – Wellness Programs • Acquisition of genetic information pursuant to a VOLUNTARY wellness program will not violate GINA if: • (1) Genetic information is provided voluntarily by the individual; • (2) Individual provides prior knowing, written and voluntary authorization; and • (3) Individually identifiable genetic information is provided only to the individual or qualified health personnel and not to the employer.

15. Medical Exams Relating to Employment • Regulations make clear that the prohibition against acquiring family medical history applies to medical examinations related to employment. • Employers are required to specifically advise health care providers not to collect genetic information, including family medical history, as part of a medical examination intended to determine an individual’s ability to perform a job.

16. Recommendations • Employer forms used to request medical information should EXPRESSLY advise health care providers that genetic information is not requested by the employer. • Use the “Safe Harbor” language on all requests. • Train managers and supervisors on the vast scope and dangers of violating GINA. • Violations? COSTLY • Remedies include – compensatory and punitive damages, attorneys and expert fees, and injunctive relief (including reinstatement, hiring, and back pay)

17. GINA Recap • Effective 1/10/11 • GINA prohibits acquiring genetic information • Exceptions • Requests for medical information • “Water cooler” discussions • Voluntary wellness programs • How does it affect me? • Most employers probably need to modify their employment policies, procedures, and forms to ensure compliance with the new law. • Specifically – any post-offer medical questionnaires or medical examination forms.

18. TOPIC #2: KEY CASE DECISIONS

19. THE UNITED STATES SUPREME COURT

20. ORAL COMPLAINT SUFFICIENT TO PROTECT EMPLOYEE FROM RETALIATION UNDER FLSA • Kasten v. Saint-Gobain Perf. Plastics Corp. (3/22/11) • Kasten received three disciplinary notices for “issues” he had with punching in and out on the time clock. • After each notice, Kasten alleged that he verbally complained to supervisors about the location of the time clock in the plant – he alleged that it prevented employees from getting paid for the time they spent putting on their protective gear. • Kasten received a fourth notice, was fired, and filed suit alleging retaliation for his verbal complaints.

21. Kasten v. Saint-Gobain Perf. Plastics Corp.(Cont’d) • FLSA forbids employers “to discharge or in any other manner discriminate against any employee because such employee had filed any complaint ... related to the Act.” • Court found that a narrow reading of “filed any complaint” to only include written complaints would unnecessarily restrict those employees most in need – “illiterate, less educated, or overworked” • Held: “Filed any complaint” includes oral complaints from the employee

22. Kasten v. Saint-Gobain Perf. Plastics Corp.Impact on Employers • Risk of a slippery slope • What about break room griping? • Venting out on the plant floor overheard by a team leader? • Train all levels of supervision and administration to recognize a potential oral complaint under the FLSA • Working off the clock • Working through lunch – not “free and clear” • On-call time • Overtime • Minimum wage • Youth labor • Deductions from wages • After hours compensable time – Blackberry usage, etc.

23. Cat’s Paw Liability

24. SUPERVISOR’S INFLUENCE ON DISCRIMINATORY DECISION CREATES EMPLOYER LIABILITY • Staub v. Proctor Hospital (3/1/11) • Staub was an employee of Proctor Hospital and a veteran member of the U.S. Army Reserve • Staub’s immediate supervisors were allegedly hostile to his military obligations because of the strain it placed on scheduling and the other employees • Supervisors issue a “Corrective Action” that was allegedly false • Subsequently, Staub is fired for failing to abide by the “Corrective Action” • Staub sues alleging discrimination in violation of the USERRA

25. Staub v. Proctor Hospital (Cont’d) • Prior to this case, there were a number of different standards across the country for cat’s paw” supervisor liability. • Bias imputed unless “totally independent”; • Bias imputed if “singular influence” by the biased party; • Bias imputed unless adequate investigation by higher supervisor; • Bias imputed only if decision “wholly dependent” on facts as presented by biased person. • 7th Circuit in the last camp. Supreme Court reversed.

26. Staub v. Proctor Hospital (Cont’d) • Court held: “If a supervisor performs an act motivated by antimilitary animus that is intended by the supervisor to cause an adverse employment action, and if that act is a proximate cause of the ultimate employment action, then the employer is liable.” • Thus, an independent investigation does not shield employer from liability if it takes into account a supervisor’s biased report.

27. Staub v. Proctor HospitalImpact on Employers • This case requires much more scrutiny of each underlying disciplinary act along the way to a termination, and the motives of each supervisor involved in those decisions • Be absolutely clear who your decision maker is and who your decision maker is not, be careful with loose language – “reviewed”, “recommended”, “approved”, was “advised” or “notified” of termination • If you have concerns about the motivation of someone lower in the chain, insulate your decision from him or her and do not incorporate his or her performance reviews or discipline into your case to terminate

28. CAN A THIRD PARTY MAINTAIN A RETALIATION CLAIM UNDER TITLE VII? • Thompson v. North American Stainless, LP (1/24/11) • Miriam Regalado, Thompson’s fiancé, filed a gender discrimination charge against Defendant with the EEOC. • Three weeks later, Defendant fired Thompson. • Thompson claimed he was fired because his fiancée filed an EEOC charge. • Court assumed that Defendant fired Thompson to retaliate against Regalado • Thompson will be required to prove this at trial.

29. Thompson v. North American Stainless (Cont’d) • Title VII grants Plaintiff a cause of action because he is a "person claiming to be aggrieved ... by an alleged employment practice." The plaintiff was within the "zone of interests" sought to be protected by the statute. • Court held: "We think it obvious that a reasonable worker might be dissuaded from engaging in protected activity if she knew that her fiancé would be fired.“ • Bottom line: Anti-retaliation protections of Title VII extend to employees who are the close family members of another employee!

30. Thompson v. North American Stainless (Cont’d) • Very important decision – especially given that retaliation has become most common EEOC charge. • Employers should resist the temptation to fire a spouse, significant other or close relative of an employee who has filed a complaint/claim because their relationship would “be a problem” in defending the claim. • Before taking action, review actions with counsel. • No clear line as to what relationships are sufficient enough to be included in this rule.

31. FOURTH CIRCUIT COURT OF APPEALS

32. EEOC v. Cromer Food Services • Homer Howard was a route driver for a food-stocking company that sells snacks and beverages in vending machines • Howard was harassed on a daily basis by two male employees at a hospital where he stocked food for the vending machines • Harassment included name calling, graphic discussions of oral sex, groping and propositioning • Cromer’s sexual harassment policy required employees to report harassment directly to the Company’s President • Instead, Plaintiff reported harassment to three different Cromer supervisors, the Chairman of the Board, the hospital’s HR dep’t, and the harassers’ supervisor

33. EEOC v. Cromer Food Services • Cromer took no action to stop the harassment because (1) they told Howard to “let it go”, that it was all just “joking”; and (2) they claimed that because the harassers were customers and not Cromer employees, it was “out of their control” • Howard went to the EEOC • Cromer then offers him a position on a shift which doesn’t involve the hospital – for less money! • Howard says no thanks . . . And is fired!

34. EEOC v. Cromer Food Services (Cont’d) • Court adopts “negligence” standard for employers: • Employer is liable for sexual harassment by third parties if it knew or should have known of the harassment and failed to take appropriate actions to halt it. • Court found that a “reasonable person” would have known about the harassment given Plaintiff’s “vocal and vociferous complaints to practically anyone who would listen.” • Court blasts harassment policy for requiring complaints to the Company President: “An employee might be easily intimidated and fail to report it such that the Company would be technically insulated from liability. We do not find such a result just or proper.”

35. EEOC v. Cromer Food Services (Cont’d) • What about the offer to transfer to the new shift? • Unacceptable says the Court! Howard will end up making less money and the new shift conflicts with his childcare responsibilities. • “A remedial measure that makes the victim worse off is ineffective per se. Furthermore, corrective action is not enough if it is too little, too late.”

36. EEOC v. Cromer Food ServicesImpact on Employers • Remember that you are responsible for ensuring your employees are not harassed by any third parties – guests, customers, vendors, suppliers, independent contractors, etc. • Include multiple channels of complaint for harassment victims/witnesses, a high level executive should be a last resort! • When considering solutions, ask yourself if the victim would be worse off in any sense of the word – compensation, hours, benefits, schedule • Have the victim sign off on any agreement to transfer to a different job, shift, department, location, reporting structure, etc.

37. EEOC v. Cromer Food ServicesImpact on Employers • It is always preferable to inconvenience the harasser – not the victim! • What else could Cromer have done? • Availed itself of its relationship with the hospital to ask the hospital’s management to investigate and discipline the harassers • Asked its other employees if anyone wanted to switch routes with Howard

38. ARE WE HAVING FUN YET?!

39. TOPIC #3: ADA AMENDMENTS ACT

40. AMERICANS WITH DISABILITIES ACT (“ADA”) Two Cornerstones: • Prohibits Discrimination Against Qualified Individuals With a Disability (“QIWD”) • Requires Employers to Provide Reasonable Accommodation to QIWD

41. QIWD: A Two-Part Definition • “Qualified” • Can perform essential job duties with or without reasonable accommodation • “Disability” • A physical or mental impairment that substantially limits a “major life activity” OR • A record of such impairment OR • Being regarded as having such an impairment

42. DISABILITY DISCRIMINATIONWhat Are the “Essential Functions” of a Job? • In general, “essential functions” of a job mean the primary job duties • In deciding whether a function is essential, consider such things as whether: • the job exists to perform that function • there are a limited number of employees available to perform the function • the function is highly specialized • could you do the job without the function?

43. DISABILITY DISCRIMINATIONWhat is a “Physical Impairment”? • Any physical disorder or condition, cosmetic disfigurement, or anatomical loss affecting a major body system. Such as: • visual, speech, hearing and orthopedic impairments • cerebral palsy, epilepsy, muscular dystrophy, multiple sclerosis, cancer, heart disease, diabetes, HIV disease, tuberculosis • Recovery/rehabilitation from drug addiction and alcoholism (NOTE: active use is not a disability)

44. DISABILITY DISCRIMINATIONWhat is a “Mental Impairment”? • Any mental or psychological disorder, such as emotional or mental illness, including: • major depression • bipolar disorder • post-traumatic stress disorder (PTSD) • anxiety disorders • schizophrenia • obsessive-compulsive disorder (OCD) • personality disorders (must be pathological, not just annoying!)

45. DISABILITY DISCRIMINATIONWhat Is Not an “Disability”? • A “disability” does not include: • Temporary, non-chronic impairments of short duration with little or no residual effects • e.g. common cold, flu, sprains, standard stomach aches, broken bones expected to fully heal • physical characteristics such as eye or hair color, being left-handed or height or weight that is within “normal” range • EEOC says you must be 2 times the normal body weight, or morbidly obese, for weight to become a disability • common personality traits, such as poor judgment or a quick temper, that do not rise to the level of a diagnosable personality disorder • advanced age in and of itself • pregnancy in and of itself

46. ADA Amendments Act of 2008 (ADAAA) • Passed by Congress on September 25, 2008 • Expressed Congress’ clear intention that the ADA be interpreted broadly and that the EEOC’s current regulations were inconsistent with that intent • Legislatively overturned the Supreme Court in two cases where Congress felt the results conflicted with Congressional intent of broad protection

47. ADA AmendmentsAct of 2008 • Bottom line – makes it easier for individuals with disabilities to obtain protection under the ADA • Directed the EEOC to promulgate new regulations to implement this intent

48. Litigation Landslide 2010 - 25,165 disability claims 2009 - 21,451 disability discrimination charges Highest number of disability charges in ADA’s 20-year history Largest percentage increase of any protected category Up 7,000 charges from 2007 Reasons: recession and ADAAA

49. Final Regulations and Revised Interpretive Guidance Issued on March 25, 2011 Provide for broad coverage under the ADA Focus on the issue of whether discrimination occurred rather than coverage issues Make “reasonable accommodation” a regular part of doing business

50. Statutory Changes to Definition of Disability • “Substantially limited” redefined • Formerly defined as the person is either: • unable to perform the major life activity OR • significantly restricted as to how, or for how long, the person can perform the activity • Now meets when impairment substantially limits (or substantially limited in the past) the individual in performing a major life activity as compared to most people in the general population • Need not prevent • Need not significantly or severely restrict