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The Mother’s Day Edition:  So Your Employee is Going to be a Mom – Now What?

The Mother’s Day Edition: So Your Employee is Going to be a Mom – Now What?

By:  Rhonda Armstrong – 5/8/14

Happy Mother’s Day! With Mother’s Day upon us, it’s a good time to recap what Michigan employers’ responsibilities are with respect to non-discrimination, handling leave, and light-duty requests for expectant mother employees.

Non-Discrimination

The most common pregnancy-related discrimination claims are brought pursuant to the federal Pregnancy Discrimination Act (which prohibits discrimination on the basis of pregnancy, childbirth, or related conditions), and laws prohibiting sex discrimination (e.g., Title VII and Michigan’s Elliott-Larsen Civil Rights Act). The Family Medical Leave Act (FMLA), largely known for its leave provisions, also prohibits retaliation against employees.

Clearly, firing or disciplining someone solely because they are pregnant would be a clear violation of the no-discrimination laws. But, here are a few examples which would likewise land an employer in hot water quick:

  • Terminating an unwed female employee because she got pregnant out of wedlock (likely also marital status discrimination under Michigan law);
  • Treating an employee who had an abortion differently;
  • Not offering the same types of leave/benefits to pregnant employees as that offered to others with short-term disabilities;
  • Not permitting an employee to use a breast pump at work;
  • Not allowing employees to come back to work until you feel they are safe or prohibiting employees from working because you feel it is unsafe for their unborn child.

 To date, courts have generally found leave or accommodation needs related to childcare (e.g., different or part-time schedules after a child is born) to be outside the purview of non-discrimination laws. And, while some employers have succeeded in treating pregnant employees differently for certain reasons (e.g., flight attendants who must be ready to help with passengers in emergency situations), this defense has not gained much court support (particularly with respect to across-the-board policies).

How much pregnancy/related leave must you provide?

If you are an employer with 50 or more employees, the answer is fairly clear-cut. You are covered by the Family Medical Leave Act (FMLA), and it requires employers to provide eligible employees with up to 12-weeks of unpaid leave in a 12-month period (which is measured a variety of ways, per the FMLA and depending on your written policy). Eligible employees include those who have worked for the employer for 12 months, have worked 1,250 hours in the prior 12 months, and work at a covered employer’s worksite where at least 49 other employees are employed within a 75-mile radius. Employers must be careful when navigating their responsibilities with respect to pregnant employees under the FMLA, as there are many rules regarding when certification may be requested, appropriately designating the leave, etc.

If you are a Michigan employer who is not covered by the FMLA and/or an employee does not meet the FMLA eligibility requirements, the answer is not so clear-cut. The only laws now in place to protect this group of employees are the non-discrimination laws which do not provide any clear answers. However, terminating an employee for missing work because of the standard 6 week inability to perform due to pregnancy and childbirth would be extremely risky. Our firm’s experience has been that courts are less inclined to dismiss pregnancy discrimination cases than most other discrimination cases.

Do you need to accommodate pregnant employees (beyond leave obligations)?

As set forth above, state and federal law requires employers to treat pregnant employees similar to how they treat others with short-term disabilities. Therefore, if an employer has provided light-duty assignments to workers with short-term disabilities, then it should do the same for pregnant employees. Prior to 2009, Michigan case law permitted employers to favor employees with respect to workers-comp/light-duty assignments, but Michigan amended its statute to specifically prohibit employers from treating pregnant employees different than those in other categories (in an apparent effort to override a court decision on the issue).

For employers covered by the Americans With Disabilities Act, while cases have held that pregnancy alone is not a “disability,” other cases have held that certain conditions may bring an employee within the ADA’s protections (e.g., employees with pregnancy complications such as back pain, spotting, dizziness, etc.). Once within the ADA’s protection, an employer has the duty to accommodate the employee’s disability unless to do so would pose an undue hardship.

Employers should be on the lookout, however! Some states have enacted laws that require employers to accommodate pregnant employees, but to date Michigan has not joined these ranks.

Employer Take Aways

Obviously, when the FMLA is implicated, employers must offer FMLA leave. But, even beyond that, employers need to offer at least SOME leave time. While no law now dictates a minimum amount for Michigan employers, we generally recommend at least 4-6 weeks. This is likely adequate to demonstrate that the employee has sufficiently healed from childbirth (to defend claims that the actions were related to childbirth-related conditions) and is probably what most would consider the bare minimum for a new mom. If employers have safety or other concerns, it is wise to involve counsel to evaluate what, if any, options the employer has under the circumstances. In our experience, we have found it increasingly difficult to defend pregnancy-based claims due to, among other things, juror sympathies. Jurors tend to empathize with the new mom who just got fired and now can’t support her newborn, even when the employer’s actions are legally defensible and justified.

 

There is No Room for a Donald Sterling in Your Organization

There is No Room for a Donald Sterling in Your Organization

By:  La Toya Palmer – 5/6/14

As we all know from recent news, Los Angeles Clippers’ suspended-for-life owner made outrageously bigoted and racist remarks that have been widely and continuously broadcast in the news media. Employers and human resource departments should learn two lessons from this debacle.

First, this should be a lesson to any company or organization harboring their own internal “Donald Sterlings” in their midst. I’m talking about those rogue executives or managers known for their “off-color,” racist, sexist or other disparaging remarks, who get a pass because of their title, or because they have such a unique or rare skill set that others within the organization don’t want to deal with the problem they present. The Sterling incident shows how an organization can be impacted when such conduct is exposed, and could be used as a “teaching moment” to remind those individuals to keep their thoughts to themselves.

The second lesson revolves around the NBA’s inability to expel Sterling at its will. Rather, the league can only remove him from the league upon a three-fourths vote by the owners, who may or may not expel him because they too may have behind the scenes vulnerability in the form of young mistresses, impolitic statements or conduct that would bring scorn upon them if exposed. A mere employer would assert its at-will clause and excise Sterling, solving an image problem and solidifying a legal defense against any racial harassment claims. The NBA cannot. The Michigan Supreme Court has spoken to the situation where a harasser cannot be removed from the organization in a case known as Radtke v Everett: In such circumstances, the employer is stripped of the defense that it remedied the problem through prompt remedial action, up to and including discharge. Dr. Everett was a 50% shareholder of a veterinarian practice and owners cannot be “fired.” His practice thus did not have the “we fired the harasser” defense. Other organizations cannot “fire” the harasser, including public employers when the harasser is an elected official. The only way to prevent lawsuits in those situations is preventing comments that could be perceived as harassment.

Should Sterling’s behavior come as a surprise? As the media frenzy continues to swarm around Sterling’s most recent comments, others are coming forward with equally disturbing and not so secret stories. As defense attorneys, we might have taken the first red flag with a grain of salt. Sterling was sued by and settled with the U.S. Justice Department and a non-profit human rights group alleging housing discrimination. However, because many housing discrimination cases are based on “testers” who then receive damages recovered, we fear that the system can be manipulated to ensure such recoveries. But testimony in that case claimed that Sterling said the blacks living in his building smelled and were unclean, so the allegations qualify as a red flag. Sterling was also sued by former Clippers’ executive Elgin Baylor, who alleged he was underpaid as a general manager and fired after 22 seasons because he was African-American. Several disturbing stories came out of the lawsuit. Baylor alleged that Sterling would bring women in the locker room to “look at those beautiful black bodies.” However, a jury rejected Baylor’s case. In that light, the litigation is no more of a red flag than the high percentage of cases that P&C gets dismissed for our clients.

With all of these “smoking guns” surfacing during Sterling’s tenure, the NBA should have taken steps to address what was glaringly obvious. They had a serious problem in their group of owners. If the NBA had taken a “where there is smoke, there is fire” approach, it might have avoided its current PR disaster or even reformed Sterling’s behavior.

Still the lesson to be learned is that Sterling’s current comments and past transgressions are a plaintiff attorney’s dream and a management labor and employment lawyer’s and HR professional’s nightmare. Racist comments in the workplace are often cited as evidence of a hostile work environment and can turn a jury against the employer. Not to mention, the negative effects such comments can have on employee morale, customer and public perception, to name a few.

Business owners can protect themselves from this type of unpopular scrutiny and ridicule by having robust policies and procedures in place that deal with negative behaviors as soon as they surface. Business owners should:

  • Have a complaint process in effect with an in-house process where reports of discrimination are made to an identifiable person that acts as the gatekeeper and who responds to each and every complaint.
  • Ensure that all aspects of the investigation are well documented. In the event of a lawsuit, you want to make sure that you have all your documentation in order.
  • Have a written discipline policy in place-Employees should know what to expect when an investigation occurs. Sometimes this may include suspending a person with or without pay pending the conclusion of an investigation. The investigation may even end up with the termination of the employee who made the offensive remarks, although lesser measures are possible for initial transgressions.
  • Have an anti-retaliation provision, where those making complaints or participating in the investigation will not have their complaint or participation held against them.

If you have any “Donald Sterlings” peppered throughout your organization, there is no better time than now to address the problem head on. Better now than later, when a former employee sues you with a “slam dunk” case of racial discrimination or harassment.

Yet Another Liberal Pol Wises Up Late In Life – After Starting a Business – Too Late Smart

Yet Another Liberal Pol Wises Up Late In Life – After Starting a Business – Too Late Smart

By:  Bill Pilchak – 05/01/14

     Bob Talbert, a Free Press columnist until the 1990’s, often wrote about “things learned en-route to looking up other things.” Attorneys, too, come across interesting information. Recently, I stumbled upon a Washington Post Blog by Thomas Heath about David Bonior, “the former Michigan Democratic congressman, liberal pit bull…and labor-union BFF.”

      Heath reports that Bonior has recently undergone an epiphany. His change of heart occurred after he opened two restaurants in Washington D.C. Now 68 years old, Bonior is quoted as saying, “Small-business people work very hard.” This apparently comes as a surprise to Bonior, who spent most of his life in “in governmental service” or “at the public trough” (pick your own end to that sentence). He contrasted his new-found private sector perspective to what he found in government: “If you are a small-business guy, you are out there and not as protected as a government employee. They [business owners] struggle every day. [On] a snow day, a government worker is off. A restaurant person takes a hit from that snow day,” because of the loss of business. The fact that a former Congressman considers that observation sufficiently astute to say it out loud to a reporter should be alarming. Many on the left –dictating how businesses must be run – have absolutely no idea what it takes to run a business.

      Now that he is on the other side of the fence, Bonior said if he had the power, he would lighten up on regulations. Heath quotes him as saying: “It took us a ridiculous amount of time to get our permits. I understand regulations and. . . the necessity for it. But we lost six months of business because of that. It’s very frustrating.” One wonders what Bonior would think if he were in an industry more highly regulated than the hospitality trade.

     “The biggest surprise is how you have to hustle,” Bonior said to Heath in another shocking disclosure of his naiveté. “It was an eye-opener. I always heard this when I was in Congress. ‘You should try and own a business someday, Bonior.’” So now that he does own a business, he finds, “It’s tough to make it, in terms of profit margins. But somehow you get by and you figure it out.”

     The co-author of the Bonior-Kennedy bill which sought to increase the minimum wage in 2000, pays his non-union employees “the tip wage,” $2.36 an hour. Oddly, the person who tried to force others to pay their employees more, chooses to pay his personnel the absolute minimum. It’s understandable, because restaurants, like retail and other industries, operate on a razor thin margin. But Bonior’s about-face is not merely hypocrisy, but reflects the realities of running a business in 2014. Bonior’s comments should be hand-delivered to every one of his former colleagues who are trying to raise wages in 2014. The pie has been sliced too thinly already. They should be told that even a left-wing warrior who spent a career trying to increase wages cannot do so “in real life” without ruining the venture into which he has poured his savings.

     To be fair on the hypocrisy point, Bonior reports that his employees get paid vacations of at least two weeks a year. Heath’s blog article did not report if that vacation pay is paid at $2.36 per hour, or whether Bonior somehow provides the missing “tip income” to them while on vacation. The article does note that “most employees who were on the restaurants’ health plans have signed up for coverage via the Affordable Care Act,” but does not indicate whether Bonior required a steep co-pay or whether Bonior will eliminate the company plan now that his employees are on Obamacare. Tellingly, however, Bonior’s restaurants do not have retirement plans, though a 401-k plan is easily provided to employees at little cost to an employer.

     As the title of this article suggests, Bonior is not the first liberal Dem to wake up and smell the coffee. Senator and 1972 Presidential candidate, George McGovern, similarly came to his senses late in life. He authored two widely disseminated articles repudiating his earlier liberal views. The first was an Op-Ed in The Wall Street Journal in 1992, titled A Politician’s Dream Is a Businessman’s Nightmare.” Here are some excerpts from that article:

      In 1988, I invested most of the earnings from th[e] lecture circuit acquiring the leasehold on Connecticut’s Stratford Inn… The Stratford Inn promised the realization of a longtime dream to own a combination hotel, restaurant and public conference facility — complete with an experienced manager and staff. In retrospect, I wish I had known more about the hazards and difficulties of such a business, especially during a recession of the kind that hit New England [in 1988] just as I was acquiring the inn’s 43-year leasehold. I also wish that during the years I was in public office, I had had this firsthand experience about the difficulties business people face every day. That knowledge would have made me a better U.S. senator and a more understanding presidential contender. (emphasis added.)

     McGovern’s OpEd then speaks of regulations that may have appeared to make sense to the politicians passing them, but which were actually creating a huge headache for businesses:

     In short, “one-size-fits-all” rules for business ignore the reality of the marketplace. And setting thresholds for regulatory guidelines at artificial levels — e.g., 50 employees or more, $500,000 in sales — takes no account of other realities, such as profit margins, labor intensive vs. capital intensive businesses, and local market economics. The problem we face as legislators is: Where do we set the bar so that it is not too high to clear? I don’t have the answer. I do know that we need to start raising these questions more often.

     Fran Tarkenton, the former NFL quarterback and founder and CEO of OneMoreCustomer.com, a resource for Small Business Advocacy, wrote about McGovern at the time of his passing in 2012. Tarkenton reported that McGovern’s business went bankrupt within two years and closed by 1991. He quotes McGovern as saying, “The concept that most often eludes legislators is: ‘Can we make consumers pay the higher prices for the increased operating costs that accompany public regulations and government reporting requirements with reams of red tape.’” McGovern eventually concluded what anyone in business knows: “consumers do have a choice when faced with higher prices. . . Every such decision eventually results in job losses for someone.”

     Certainly, Michiganians can attest to that. We all watched the foreign automakers land on our shores, but avoid Michigan with its gold-plated sue-the-employer statutes and union mindset, and set up shop in states where they could avoid litigation expenses and silly union work rules. Somewhat surprisingly, McGovern’s second published revelation speaks precisely to the union context. On May 22, 2006, McGovern’s letter to the editor appeared in many newspapers across the country, prominently referring to Michigan-based Delphi Corporation and the auto industry two years before Chrysler and GM were driven to bankruptcy. Here are some excerpts:

  THE END OF `MORE’

I have never wavered in my support for policies that relieve poverty and improve the standard of living of American workers. As a lifelong liberal, I supported Medicare and Medicaid, civil rights, Social Security and workplace safety requirements…And I have always been a supporter of the labor movement. Unions have a proud legacy of improving the lives of millions of workers over the last century…

But lately I have seen developments that have me worried…

Delphi Corp., the biggest auto parts supplier in the country and the employer of 34,000 hourly workers, is bankrupt. One big reason is that the company’s unionized workers earn $64 an hour in wages and benefits — more than twice what some of its competitors pay…

General Motors and Ford — the companies that have epitomized high-paying unionized jobs over the last several decades — have stated that they will lay off 30,000 workers each…Wall Street thinks these are just the first steps.

“More” has, unfortunately, become “too much” in a global and far more competitive economy.

Many of my friends will consider this view heretical. But it is based on stark reality. Not unlike members of Congress, union leaders are in the business of asking for more. That’s what their mentors and predecessors and heroes did. It’s very difficult to turn around and say that “more” is not always possible.

It can be galling to hear companies argue that they have to cut wages and benefits for hourly workers — even as they reward top executives with millions of dollars in stock options. The chief executive of Wal-Mart earns $27 million a year, while the company’s average worker takes home only about $10 an hour. But let’s assume that the chief executive got 27 cents instead of $27 million, and that Wal-Mart distributed the savings to its hourly workers. They would each receive a bonus of less than $20. It’s not executive pay that has created this new world.

 I understand the attraction of asking business — the perceived “deep pockets” — to shoulder more of the responsibility for social welfare. But there are plenty of businesses that don’t have deep pockets. And many large corporations operate with razor-thin profit margins as competitors, both foreign and domestic, strive to attract consumers by offering lower prices.

       A popular 2013 book based on an old Dutch proverb uses the term “Too Late Smart.” The epiphanies experienced by Bonior and McGovern should be required reading for those on the left who have no responsibility for America’s industrial and commercial enterprises. America, and especially Michigan, do not have time for Too Late Smart.