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Supreme Court Rules Against Inference of Class Arbitration in Silent Contracts.
Posted: April 30th, 2010, 1:00am EDT
On April 27, with Justice Samuel Alito writing for the 5-3 majority (Justice Sonia Sotomayor abstained), the U.S. Supreme Court addressed class-action arbitration when the parties agreement was silent regarding the aggregation of multiple parties claims. According to the Court, the arbitration panels imposition of class arbitration despite the parties stipulation that they had not reached an agreement on this issue is fundamentally at war with the Federal Arbitration Act (FAA) principle that arbitration is a matter of consent. [A]n implicit agreement to authorize class action arbitration, the Court ruled, is not a term that the arbitrator may infer solely from the fact of an agreement to arbitrate. -
Implementation of Revisions to Federal Drug Testing Guidelines Moves to October 1.
Posted: April 30th, 2010, 1:00am EDT
The U.S. Department of Health and Human Services (DHHS) has announced that it will delay implementation of the revisions to the Mandatory Guidelines for Federal Workplace Drug Testing Programs from May 1, 2010, to October 1, 2010. (See [www.federalregister.gov] to view the April 29 announcement.) The specific revisions to the Mandatory Guidelines were summarized in our February 8, 2010 article, U.S. DOT Proposes Requiring Drug Testing for Ecstasy, Lowering Cutoff for Cocaine and Amphetamines.
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Supreme Court Rules Class Action Arbitrations Impermissible Absent Express Agreement.
Posted: April 29th, 2010, 1:00am EDT
The U.S. Supreme Court recently handed down its long-awaited ruling in Stolt-Nielsen S. A. v. Animalfeeds International Corp., No. 08-1198 (Apr. 27, 2010). The issue before the Court was, can an arbitration agreement that is silent on the issue be construed to permit a case to proceed in arbitration as a class action?
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Side Effects from Essential Medication May Be ADA Disability, Third Circuit Rules.
Posted: April 29th, 2010, 1:00am EDT
In an action for disability discrimination, harassment, and retaliation under the Americans with Disabilities Act, a federal appeals court in Philadelphia has held on an issue of first impression for the panel that the adverse side effects of medication may constitute a disability only if the treatment is required in the prudent judgment of the medical profession and there is no available alternative that is equally effective but lacks similarly disabling side effects. Sulima v. Tobyhanna Army Depot et al., No. 08-4684 (3d Cir. Apr. 12, 2010). The Court affirmed summary judgment in favor of the employer, holding that there was insufficient evidence that the treatment that caused the alleged disabling impairment was medically necessary. The Third Circuit has jurisdiction over Delaware, New Jersey, Pennsylvania, and the U.S. Virgin Islands.
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U.S. Supreme Court Nixes "Enhanced" Attorney's Fee Award.
Posted: April 29th, 2010, 1:00am EDT
In a decision that may affect the popularity of employment class actions among plaintiffs attorneys, the U.S. Supreme Court has ruled that federal courts should not award enhanced attorneys fees for superior attorney performance except in the most extraordinary circumstances. Perdue v. Kenny A. et al., No. 08-970 (U.S. Apr. 21, 2010). Rather, there is a strong presumption that the lodestar method of calculating a reasonable attorneys fee (the number of hours the attorneys and their employees worked multiplied by the hourly rates prevailing in the community) yields a sufficient fee. Enhancements should not be awarded without specific evidence that the lodestar fee would not have been adequate to attract competent counsel. Because the federal district court failed to provide a proper justification for its fee enhancement, the Court reversed the judgment awarding $10.5 million in attorneys fees that included a 75 percent fee enhancement.
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Sharply Divided Ninth Circuit Upholds Class Certification in Massive Sex Discrimination Litigation.
Posted: April 29th, 2010, 1:00am EDT
A slim 6-5 majority of the U.S. Court of Appeals for the Ninth Circuit has upheld most aspects of a lower courts class certification ruling in a historic sex discrimination action, allowing female employees nationwide pay disparity and promotion claims against the countrys largest retailer to go forward on a class basis. Dukes et al. v. Wal-Mart Stores Inc., Nos. 04-16688 & 04-16720 (9th Cir. Apr. 26, 2010) (en banc). Though the Courts decision excludes from the mammoth class employees who no longer were employed by the company when plaintiffs brought suit in 2001, and may limit the availability of class-wide punitive damages, it provides little comfort for employers.
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IRS Issues Guidance to Clarify Health Care Reform Coverage of Adult Children.
Posted: April 29th, 2010, 1:00am EDT
The Internal Revenue Service has released guidance concerning how employers can deal with changes made by the recent health care reform laws in the coverage of adult children. Apparently, the IRS is trying to encourage group health plans and health insurance issuers to provide dependent coverage to adult children until age 27 immediately. This guidance is contained in Notice 2010-38, released April 27, 2010.
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Today's HR Executives: How Career Paths Have Changed -- and Stayed the Same.
Posted: April 29th, 2010, 1:00am EDT
Step into the office of the head of corporate human resources today and the odds are you will find a 53-year-old man with a bachelor's degree who has been with his current employer for 15 years. He has spent about half his work life in HR roles, most often in workforce development. And he would not be that much different from the man holding the job a generation earlier.
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Health Care Reform is Now Law: Will the Light Come on When Your Employees Open the Fridge?
Posted: April 29th, 2010, 1:00am EDT
On March 30, 2010, the President signed the Health Care and Education Reconciliation Act of 2010 into law (the Reconciliation Act). The Patient Protection and Affordable Care Act, commonly referred to as the Senate bill, was signed a week earlier. The Reconciliation Act made changes to the Senate bill necessary to achieve passage in the House while avoiding a Senate filibuster, enabling the enactment of comprehensive health care reform. The combined acts are referred to in this E*Bulletin as the Act.
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New FLSA Misclassification Bill Introduced in Both Houses of Congress.
Posted: April 28th, 2010, 1:00am EDT
The Employee Misclassification Prevention Act, legislation targeting abuses of the employee/independent contractor classifications, has been introduced again in both houses of Congress on April 22. The bill was presented by Representative Lynn Woolsey (D-Cal.) in the House on April 22, 2010, and by Senator Sherrod Brown (D-Ohio) in the Senate on the same day.
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OSHA Unveils "Severe Violator Enforcement Program" and Increases Penalties
Posted: April 28th, 2010, 1:00am EDT
In moves that could raise the cost markedly for employers who violate the Occupational Safety and Health Act, the Occupational Safety and Health Administration not only has reworked its penalty formula to increase average serious penalties (OSHAs garden-variety sanction) by three- to fourfold and to increase the chances of employers incurring repeated violations and still greater penalties, but has rolled out a Severe Violator Enforcement Program (SVEP) to focus sanctions on employers the agency says have demonstrated indifference to their occupational safety and health obligations through willful, repeated or failure-to-abate violations in described situations.
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Mayo Clinic Case Difficult to Diagnose.
Posted: April 28th, 2010, 1:00am EDT
This article, written by George E. O'Brien Jr. of Littler's New Haven office, comments on Mayo Clinic v. Peter L. Elkin. The case highlights employment issues that hospitals and medical research institutions face when trying to retain rights to inventions developed by employee researchers who later move on to other institutions. How an institution can protect itself in these instances without negatively impacting its reputation with peers, its ability to attract future research grants, and its attractiveness when recruiting top talent is a vexing problem, writes O'Brien.
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No Class Arbitration Under the FAA Unless Specifically Agreed, At Least for Now.
Posted: April 28th, 2010, 1:00am EDT
Today the Supreme Court decided a case important in the employment law field although the underlying case was a commercial dispute. The question in Stolt-Nielsen v. AnimalFeeds International (S.Ct. 4.27.10) [pdf] was whether under the Federal Arbitration Act, arbitrators could decide that class action was appropriate if the arbitration agreement was silent on that issue. Holding that the answer was no, Justice Alito wrote:
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Supreme Court Rules Class Arbitration Not Allowed When Agreement is Silent.
Posted: April 28th, 2010, 1:00am EDT
On April 27, 2010 the U.S. Supreme Court decided that class arbitration is permissible only when the parties to a contract specifically agree. That is, silence does not amount to an implicit agreement to class arbitration. This question had confounded courts and arbitrators for years.
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Court Emphasizes that Evidence of Training Is a Must.
Posted: April 28th, 2010, 1:00am EDT
For over 10 years, employers have been able to avail themselves of an affirmative defense to sexual harassment allegations by an employee against a supervisor/manager in those situations where no tangible adverse employment action has been taken against the employee. This defense is known as the Faragher/Ellerth defense, and can be invoked where the employer can demonstrate that: (1) it exercised reasonable care to prevent and promptly correct any sexually harassing behavior, and (2) the employee unreasonably failed to take advantage of any preventative or corrective opportunities provided by the employer or to otherwise avoid harm. Faragher v. City of Boca Raton, 524 U.S. 775, 807 (1998); Burlington Indus. v. Ellerth, 524 U.S. 742, 764-65 (1998). The vast majority of employers have anti-harassment policies including reporting procedures and protocols for employees to follow, have disseminated those policies and procedures to all employees, and have required employees to acknowledge receipt of the policies. However, the adoption, dissemination and acknowledgment of receipt of the policy by the employee may not be sufficient for employer to invoke the affirmative defense.
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Mandatory Retirement of Partners (pdf).
Posted: April 28th, 2010, 1:00am EDT
There is no question but that [w]ith so many baby boomers reaching traditional retirement age, retirement policies are probably one of the biggest issues facing law firms today.1 The same is true of partnerships beyond law firms such as the accounting and medical firms that are included in the more than 2 million businesses that are organized as partnerships in the United States.2 The significance of the partnership business form is that mandatory retirement of partners based on age is permissible because, as employers, partners do not fall within the coverage of the Age Discrimination in Employment Act of 1967, as amended (the ADEA)3 or, for that matter, the other antidiscrimination laws. However, as noted in Caruso v. Peat, Marwick, Mitchell & Co., if the partners or principals duties closely resemble those of a salaried employee, with only limited decision-making responsibilities, his title alone will not defeat an ADEA claim.4
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Immigration eAuthority (April 2010).
Posted: April 27th, 2010, 1:00am EDT
Light Filing for H-1B Cap; USCIS Instructions for F-1 Students Extending OPT; $18 Million Settlement RICO Suits and Immigration Liability; E-Verify Initiatives Include Discrimination Referrals; Utah Passes E-Verify Law; Arizona Governor Considers Immigration Enforcement Bill; Visa Applicants Reminder New DS-160 Form Required by April 30; Iceland Volcano and Immigration Implications.
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High Court Rules ERISA Plan Administrator's Interpretation Is Entitled To Deference.
Posted: April 27th, 2010, 1:00am EDT
On April 21, with Chief Justice John Roberts writing for the majority, the U.S. Supreme Court upheld its Firestone Tire & Rubber Co. v. Bruch standard for reviewing the decisions of plan administrators where those decisions are made following a court determination that a previous interpretation of the same plan terms was arbitrary and capricious. Under Firestone and the terms of the Xerox Corporation pension plan at issue in this case, pension plan administrators would normally be entitled to deference when interpreting the plan. The Court held that the same deference also should apply where the administrator made a good faith error in its previous interpretation. The Court reversed the Second Circuit Court of Appeals' decision crafting an exception to Firestone deference and holding that a court need not apply a deferential standard when a plan administrator's previous construction of the same plan terms was found to violate the Employee Retirement Income Security Act (ERISA). Conkright v. Frommert, No. 08810, U.S. Supreme Court (April 21, 2010).
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First Comes Love, Then Comes Marriage, Then Comes Flex-Time and a Baby Carriage.
Posted: April 27th, 2010, 1:00am EDT
The trial in a class-action lawsuit alleging that Novartis Pharmaceuticals practiced sex discrimination against female employees has begun in a federal court in New York. The class of plaintiffs includes more than 5,600 saleswomen, who are seeking $200 million in damages. According to the New York Times, the suit alleges discriminatory pay and promotions targeting women, particularly pregnant ones.
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New Immigration-Enforcement Law In Arizona May Have Far-Reaching Implications.
Posted: April 27th, 2010, 1:00am EDT
On April 23, 2010, Arizona Gov. Jan Brewer signed into law the toughest immigration law in the country, which makes it a misdemeanor for an individual to lack proper immigration paperwork in Arizona. Local police who have "reasonable suspicion" that an individual is undocumented now have the authority to determine that person's immigration status. Under current law, officers may only inquire about immigration status if the person is a suspect in another crime.
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Third Extension of COBRA Premium Subsidy Extends Availability Through May 31, 2010.
Posted: April 26th, 2010, 1:00am EDT
Extended now for the third time, the availability of the COBRA premium subsidy has been extended through May 31, 2010. Late on April 15, 2010, President Obama signed H.R. 4851, the Continuing Extension Act of 2010. Final passage in the House of Representatives (votes 289-112) and in the Senate (votes 59-38) ensured that several government programs would be extended, including the COBRA premium subsidy.
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White Paper Discussing the Impact of Health Care Reform on Individual and Small Business Taxes.
Posted: April 26th, 2010, 1:00am EDT
In addition to significantly changing our health care and health-care delivery systems, and imposing new requirements upon employers and insurers alike, the newly-enacted health care reform laws contain a number of provisions that directly affect individuals by changing their tax situations, or by imposing additional tax liabilities. Furthermore, for owners of small businesses and their workers, the health care reform legislation has some key tax-related provisions, including tax credits, excise taxes and penalties. Ford & Harrison attorney Jeffrey Ashendorf discusses the provisions affecting individuals and small businesses in a white paper that you can access by clicking here or by going to our web site at [www.fordharrison.com]
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Nursing Mothers Gain Protection Under Federal Healthcare Law.
Posted: April 26th, 2010, 1:00am EDT
Nursing mothers who work for larger companies (50+ employees) are afforded new protections under the federal heath care law. The Patient Protection and Affordable Care Act amends the Fair Labor Standards Act to require these larger employers to provide nursing mothers "reasonable break time" to express breast milk and a private comfortable place to do so.
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FLSA Amended to Require Breaks and Space to Express Breast Milk for Nursing Mothers.
Posted: April 23rd, 2010, 1:00am EDT
In a largely unnoticed section of the Patient Protection and Affordable Care Act recently signed by President Obama, the Fair Labor Standards Act (FLSA) (29 U.S.C. § 207) was amended to require employers to provide rest breaks and space for employees who are nursing mothers to express breast milk.
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Third Circuit says accommodation may include shift change that assists with commute to work.
Posted: April 23rd, 2010, 1:00am EDT
In an unusual case of first impression, the 3d U.S. Circuit Court of Appeals has held that under certain circumstances, the ADA may obligate an employer to accommodate an employees disability-related difficulties in getting to work. In that case, the Court reversed summary judgment in favor of an employer and held that changing a part-time employees schedule to day shift because her monocular vision made it dangerous for her to drive at night could be a reasonable accommodation under the ADA
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Third Circuit says accommodation may include shift change that assists with commute to work.
Posted: April 23rd, 2010, 1:00am EDT
In an unusual case of first impression, the 3d U.S. Circuit Court of Appeals has held that under certain circumstances, the ADA may obligate an employer to accommodate an employees disability-related difficulties in getting to work. In that case, the Court reversed summary judgment in favor of an employer and held that changing a part-time employees schedule to day shift because her monocular vision made it dangerous for her to drive at night could be a reasonable accommodation under the ADA
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COBRA Subsidy Eligibility Period Extended to May 31, 2010.
Posted: April 23rd, 2010, 1:00am EDT
Last night, President Obama signed the Continuing Extension Act of 2010 (Act). The Act once again extends the eligibility period during which an involuntarily terminated individual can qualify for the COBRA subsidy originally created through the American Recovery and Reinvestment Act of 2009 (ARRA). The period during which an individual could qualify for the subsidy was originally set to expire on December 31, 2009, but was extended by the Defense Appropriations Act of 2010 until February 28, 2010, and extended again by the Temporary Extension Act of 2010 until March 31, 2010. The Act further extends the period during which an involuntarily terminated individual could qualify for the COBRA subsidy until May 31, 2010.
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COBRA Subsidy Eligibility Period Extended to May 31, 2010.
Posted: April 23rd, 2010, 1:00am EDT
Last night, President Obama signed the Continuing Extension Act of 2010 (Act). The Act once again extends the eligibility period during which an involuntarily terminated individual can qualify for the COBRA subsidy originally created through the American Recovery and Reinvestment Act of 2009 (ARRA). The period during which an individual could qualify for the subsidy was originally set to expire on December 31, 2009, but was extended by the Defense Appropriations Act of 2010 until February 28, 2010, and extended again by the Temporary Extension Act of 2010 until March 31, 2010. The Act further extends the period during which an involuntarily terminated individual could qualify for the COBRA subsidy until May 31, 2010.
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New Rule Implements Executive Order Encouraging Project Labor Agreements for Federal Contractors
Posted: April 23rd, 2010, 1:00am EDT
Shortly after President Barack Obama took office in 2009, he signed an Executive Order authorizing federal government agencies to require every contractor or subcontractor on a large-scale construction project to negotiate or become a party to a Project Labor Agreement (PLA) with one or more labor organizations. The Defense Department, General Services Administration, and National Aeronautics and Space Administration, which together maintain the Federal Acquisition Regulation council, have published a final rule, amending the FAR, to implement the Executive Order. The rule is available at [edocket.access.gpo.gov] The rule is effective May 13, 2010.
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POWER To The People and Unintended Consequences
Posted: April 23rd, 2010, 1:00am EDT
Immigration is a political hot button, which may be one of the greatest understatements of the year. It is certainly an issue on which people disagree, unfortunately, often disagreeably.