Four New Year’s Resolutions to Avoid the Damaging Loss of Trade Secrets

On December 21, 2015, an Illinois jury awarded Miller UK Ltd. $73.6 million against Caterpillar Inc.  Miller supplied couplers for Caterpillar’s equipment, and the jury concluded that Caterpillar used its leverage as Miller’s largest customer to demand access to information that Caterpillar then used to manufacturer its own version of the coupler.  As a result of the alleged theft, Miller claimed it had to terminate roughly seventy-five percent of its workforce, close an office, and scale back a new business venture.  This lawsuit was not between an employer and an employee, but it holds important lessons for employers that operate in industries and environments with valuable trade secrets.

1.   Audit Non-Disclosure Agreements

Trade secrets laws across the country provide a layer of protection for misappropriated trade secrets.  Non-disclosure and confidentiality agreements can often provide additional protection, by catching disclosures that would not be covered by trade secrets laws.

In the New Year, audit company records to confirm that any company or person who has access to the company’s trade secrets and proprietary information has signed a non-disclosure or confidentiality agreement.  If any of these parties did not sign an agreement during the contracting process, get an agreement in place immediately.

2.  Review Materials

In the New Year, review the company’s handbooks, policies, offer letters, and employment agreements to ensure that they prohibit theft and misappropriation of trade secrets and proprietary information from third parties (and not just the company).

Not only will this hopefully prevent employees from engaging in misconduct for which the company could be held liable (i.e. engaging in misappropriation), it could help the company avoid being held liable for any misconduct that does occur.

3.  Audit Restrictive Covenants

To the extent that your company has trade secrets and proprietary information that can be protected through restrictive covenants under applicable law, in the New Year, audit the company’s agreements with employees to ensure that all employees who have access to that information have signed the required restrictive covenants.  If an employee has not signed an agreement, identify what legal consideration will be required to obtain enforceable restrictive covenants. For those employees who have signed restrictive covenants, confirm that the company has signed (if required) and that the company records consist of both the employee’s signature and the body of the agreement that the employee signed.  Finally, review the company’s form restrictive covenants to ensure that they have kept up with the growth and development of the company (i.e. that they protect all of the company’s trade secrets and proprietary information) and with the latest developments in the law.

4.  Resolve

In the New Year, resolve to follow the three steps above at least once per year.  As the verdict demonstrates, an ounce of prevention is worth a pound of cure.  Following a regular maintenance schedule is the best way for a company to minimize the risks associated with trade secrets and proprietary information.

© Polsinelli PC, Polsinelli LLP in California

Hillshire Brands Company Pays $4 Million to Settle Race Discrimination Suit

EEOCSealAfrican American Bakery Workers Subjected to Racist Comments and Graffiti in the Worksite, Federal Agency Charged

DALLAS – Hillshire Brands Company (formerly known as the Sara Lee Corporation) will pay $4 million to a group of 74 African-American former employees and provide other significant relief to settle a lawsuit where they were subjected to a racially hostile work environment at a former Sara Lee facility in Paris, Texas, the agency announced today.

EEOC claimed African-American employees were subjected to racist graffiti on the walls of the bathrooms and locker room. The former bakery employees also alleged that during work hours, they were berated with racial slurs by supervisors and other white co-workers, and complaints by the plant workers went unaddressed by management.

Race discrimination in the workplace, including race harassment, violates Title VII of the Civil Rights Act of 1964.  The EEOC filed suit (Case No. 2:15-cv-1347) in U.S. District Court for the Eastern District of Texas, Marshall Division, after first attempting to reach a pre-litigation settlement through its conciliation process.

“The Commission completed an extensive investigation at the Sara Lee plant, which included conducting interviews with the former bakery workers,” said Meaghan L. Shepard, trial attorney for the Dallas District of EEOC. “EEOC determined racial slurs and graffiti continued at the facility in Paris for years, until the doors finally closed in November 2011.”

“EEOC strongly believes it is critically important for companies to set policies and provide effective avenues for complaints to address racial harassment in the workplace,” said EEOC Supervisory Trial Attorney Suzanne Anderson. “African-American workers on the Sara Lee bakery production lines in Paris felt embarrassed and intimidated by the graffiti in the bathroom and the racial slurs on the production floor. Strong corporate policies and quick remedial action protects against this type of workplace discrimination.”

The two-year consent decree settling the case provides for an injunction where Hillshire Brands will implement various preventative approaches regarding discrimination or harassment against any employee on the basis of race and will periodically report incidents or investigations to EEOC. Hillshire Brands also agreed to engage in remedial measures such as anti-discrimination training and implementation of procedures to prevent and promptly address graffiti issues.

Belinda McCallister, acting director of EEOC’s Dallas District Office, said, “We are pleased with the approach taken by the employer to acknowledge the hostile environment that once existed and for taking positive steps toward ensuring a healthy workplace in the future.”

EEOC enforces federal laws prohibiting employment discrimination. Further information about EEOC is available on its web site at www.eeoc.gov.

See original news release here: http://www1.eeoc.gov/eeoc/newsroom/release/12-22-15.cfm

© Copyright U.S. Equal Employment Opportunity Commission

EEOC Sues McDonald's for Disability Discrimination

mcdonalds logoFast Food Giant Denied Sign Language Interpreter for Deaf Applicant

KANSAS CITY, Mo. — McDonald’s Corporation and McDonald’s Restaurants of Missouri violated federal law by refusing to accommodate and hire a deaf applicant, the U.S. Equal Employment Opportunity Commission (EEOC) charged in a lawsuit filed today.

According to the suit, Ricky Washington, who is deaf, applied online for a job at a McDonald’s restaurant in Belton, Mo. in June 2012. Washington indicated on his application that he attended Kansas School for the Deaf. Washington also said he had previous job experience working as a cook and clean-up team member at a McDonald’s restaurant in Louisiana in 2009. When the Belton restaurant manager learned Washington needed a sign language interpreter for his job interview, she canceled the interview and never rescheduled it, despite Washington’s sister volunteering to act as the interpreter. Restaurant management continued to interview and hire new workers after Washington made several attempts to schedule an interview.

Such alleged conduct violates the Americans with Disabilities Act of 1990 (ADA), which prohibits discrimination against people with disabilities in employment and requires employers to make reasonable accommodations for job applicants so they will have equal opportunities during the application process. EEOC filed its lawsuit (EEOC v. McDonald’s Corporation, et al, 4:15-cv-01004-FJG) in U.S. District Court for the Western District of Missouri after first attempting to reach a pre-litigation settlement through its conciliation process. EEOC seeks back pay, compensatory and punitive damages, and injunctive relief, including training for all McDonald’s managers on accommodations for applicants with disabilities, particularly those who are deaf.

EEOC St. Louis District Director James R. Neely, Jr. said, “Removing obstacles in the hiring process for people with disabilities is a national priority for EEOC. All employers, but especially large ones, should join with the agency to make sure everyone has equal access to the employment process.”

“People with disabilities have one of the highest unemployment rates in the country,” added EEOC Regional Attorney Andrea G. Baran. “Providing equal employment opportunities to all job applicants – including those with disabilities – is not just the law, it is good for our economy and our workplaces.”

According to company information, McDonald’s is a global fast food provider that serves over sixty-nine million customers per day in 100 different countries.  The Belton, Mo. restaurant is owned and operated by the corporation’s world-wide headquarters in Oak Brook, Illinois.

Eliminating barriers in recruitment and hiring is one of six national priorities identified by EEOC’s Strategic Enforcement Plan (SEP).

The St. Louis District Office oversees Missouri, Kansas, Nebraska, Oklahoma and a portion of southern Illinois.

EEOC is responsible for enforcing federal laws prohibiting employment discrimination.

The original content can be viewed here.

© Copyright U.S. Equal Employment Opportunity Commission

EEOC Sues McDonald’s for Disability Discrimination

mcdonalds logoFast Food Giant Denied Sign Language Interpreter for Deaf Applicant

KANSAS CITY, Mo. — McDonald’s Corporation and McDonald’s Restaurants of Missouri violated federal law by refusing to accommodate and hire a deaf applicant, the U.S. Equal Employment Opportunity Commission (EEOC) charged in a lawsuit filed today.

According to the suit, Ricky Washington, who is deaf, applied online for a job at a McDonald’s restaurant in Belton, Mo. in June 2012. Washington indicated on his application that he attended Kansas School for the Deaf. Washington also said he had previous job experience working as a cook and clean-up team member at a McDonald’s restaurant in Louisiana in 2009. When the Belton restaurant manager learned Washington needed a sign language interpreter for his job interview, she canceled the interview and never rescheduled it, despite Washington’s sister volunteering to act as the interpreter. Restaurant management continued to interview and hire new workers after Washington made several attempts to schedule an interview.

Such alleged conduct violates the Americans with Disabilities Act of 1990 (ADA), which prohibits discrimination against people with disabilities in employment and requires employers to make reasonable accommodations for job applicants so they will have equal opportunities during the application process. EEOC filed its lawsuit (EEOC v. McDonald’s Corporation, et al, 4:15-cv-01004-FJG) in U.S. District Court for the Western District of Missouri after first attempting to reach a pre-litigation settlement through its conciliation process. EEOC seeks back pay, compensatory and punitive damages, and injunctive relief, including training for all McDonald’s managers on accommodations for applicants with disabilities, particularly those who are deaf.

EEOC St. Louis District Director James R. Neely, Jr. said, “Removing obstacles in the hiring process for people with disabilities is a national priority for EEOC. All employers, but especially large ones, should join with the agency to make sure everyone has equal access to the employment process.”

“People with disabilities have one of the highest unemployment rates in the country,” added EEOC Regional Attorney Andrea G. Baran. “Providing equal employment opportunities to all job applicants – including those with disabilities – is not just the law, it is good for our economy and our workplaces.”

According to company information, McDonald’s is a global fast food provider that serves over sixty-nine million customers per day in 100 different countries.  The Belton, Mo. restaurant is owned and operated by the corporation’s world-wide headquarters in Oak Brook, Illinois.

Eliminating barriers in recruitment and hiring is one of six national priorities identified by EEOC’s Strategic Enforcement Plan (SEP).

The St. Louis District Office oversees Missouri, Kansas, Nebraska, Oklahoma and a portion of southern Illinois.

EEOC is responsible for enforcing federal laws prohibiting employment discrimination.

The original content can be viewed here.

© Copyright U.S. Equal Employment Opportunity Commission

EEOC’S Lawsuit Against Costco to Proceed

Costco smallA federal district court judge ruled that the U.S. Equal Employment Opportunity Commission’s (EEOC) claim that Costco violated Title VII of the Civil Rights Act of 1964 by failing to prevent a male customer from stalking and harassing a female employee at the company’s Glenview, Ill. warehouse will be decided by a jury.

Judge Ruben Castillo, the chief judge of the U.S. District Court for the Northern District of Illinois in Chicago, denied Costco’s motion for summary judgment on EEOC’s claim it failed to protect one of its former employees from a sexually hostile work environment. The decision in EEOC v. Costco Wholesale Corp., 14-cv-6553, was entered on Dec. 16, 2015. The court announced it will select a jury trial date at a status hearing in January.

The court said it found evidence the employee was subjected to harassing behavior by a customer for more than a year, including ominous staring, unwanted physical touching, unwanted requests for dates and overly intrusive personal questions. The court found evidence the customer interactions continued to escalate, even though he had been talked to by Costco’s managers and the Glenview police to avoid her. The court also concluded that, added together and given the length of time over which the incidents occurred, they amounted to a level of a hostile work environment.

The court also found evidence Costco failed to take reasonable steps to stop the harassment, noting that Costco waited more than a year to ban the customer from the store. The court granted summary judgment for Costco on EEOC’s constructive discharge claim.

Costco is an international membership warehouse retailer which, according to its website, has over 650 locations worldwide, annual revenues over $100 billion, and over 125,000 employees in the United States.

EEOC’s Chicago District Office is responsible for processing discrimination charges, administrative enforcement and the conduct of agency litigation in Illinois, Wisconsin, Minnesota, Iowa, and North and South Dakota, with area offices in Milwaukee and Minneapolis.

EEOC enforces federal laws prohibiting employment discrimination. This information was previously published on the EEOC website, www.eeoc.gov.

DOL’s Recent Guidance on State Retirement Initiatives for Private Sector Employees Part II: Interpretive Bulletin

140px-US-DeptOfLabor-Seal.svg__0This post continues our two-part series discussing the Department of Labor’s (DOL’s) recent guidance on state retirement initiatives. The first part of this series, “The Proposed Rule—State-Sponsored IRAs,” discusses the DOL’s proposed rule that would create an ERISA “safe harbor” for state-sponsored IRAs. In Part II, we discuss the DOL’s Interpretive Bulletin (Interpretive Bulletin), which addresses other types of state retirement initiatives for workers in the private sector.

The Interpretive Bulletin sets out, in a summary format, the DOL’s views on state-offered 401(k) plans for private sector employees and other state initiatives. Beginning with the DOL’s strong support for ERISA-covered plans (for reasons including the availability of employer contributions, higher contribution limits, and the protection of ERISA accounts from creditors), the Interpretive Bulletin surveys a range of current and potential state-sponsored programs and offers the DOL’s views on how ERISA coverage may apply to each of these initiatives.

The Interpretive Bulletin reviews programs in

  • Washington State, where the state’s proposed retirement program is not considered to be an ERISA-covered plan, but instead by design establishes a marketplace for the offering of ERISA plans and IRAs;

  • the Commonwealth of Massachusetts, where a state law allowing nonprofit organizations to adopt a contributory retirement plan developed and administered by the state is shown as an example of how states may set up their own 401(k) prototype plans for private employers to adopt; and

  • the State of Maryland, where a Governor’s Task Force report considered the possibility of the state establishing and obtaining IRS tax qualification for a state multiple-employer plan (MEP).

The DOL closes by providing its views on ERISA preemption, including the view that the types of programs outlined in the Interpretive Bulletin would not be preempted by ERISA because they do not “undermine ERISA’s exclusive regulation of ERISA-covered plans” and that they “contemplate a state acting as a participant in a market rather than as a regulator.”

Several issues addressed in the Interpretive Bulletin are giving rise to debate, including the DOL’s view that a state’s unique “representational interest in the health and welfare of its citizens” allows a state to sponsor an MEP for in-state employers. What is new here is that the DOL is providing states a different standard for the establishment of an MEP than the “employment based nexus” standard that the DOL established for private enterprises that wish to do the same. This issue is critical because MEPs can have streamlined regulatory reporting and disclosure requirements, allowing them to provide competitive cost savings to adopting employers. Another issue to watch is the DOL’s query (included as a footnote in the bulletin) on whether state sovereign immunity laws need to be reviewed in light of ERISA’s remedial provisions.

While the DOL’s Interpretive Bulletin became effective on November 18, 2015, the impact of the Interpretive Bulletin and the proposed rules on IRAs are worth keeping an eye on. We recognize that change is often the rule and not the exception, but how these state-sponsored programs will play out has yet to be determined. A significant impact to the retirement industry could be on the horizon.

In addition to this DOL guidance package discussed in this series, there is also talk of possible legislative proposals, and the Treasury Department recently announced the federal myRA program as a voluntary national initiative.

© 2015 by Morgan, Lewis & Bockius LLP. All Rights Reserved.

EMPLOYERS: The #ElderlyChristmasSongs Hashtag Is Trending On Twitter

We have posted numerous blogs discussing the need for employers to stay on top of what is trending on the Internet. Why? Because trending topics can sometimes lead to controversial discussions that might not be consistent with an employer’s EEO Policy. As a result, we explained that it would be prudent to understand what may be the current topic being discussed around the watercooler.

Here is a follow up to those posts. The #ElderlyChristmasSongs hashtag is currently trending on Twitter. What is the relevance of this topic to employers? A quick search shows that a lot of the content posted can be construed as inappropriate and/or discriminatory (although presumably meant to be humorous).  It’s the middle of the work day where we are – so we can only presume a lot of this content is being posted by employees in the workplace.

Remember: The Age Discrimination in Employment Act and many state laws prohibit discrimination based on age.  The more questionable content generated in the workplace, the better chance an employee can argue there is evidence of a convincing mosaic of discrimination tolerated by the employer. Be sure to remind employees of your company’s EEO policy if you come across any inappropriate content and/or discussions. And, as always, be sure to stay on top of trends that may have an impact in the workplace.

© 2015 BARNES & THORNBURG LLP

Holiday Party Checklist—Plan Ahead to Minimize Employer Risks

Delicious food, fine wines, music, camaraderie, laughter – all ingredients for a great holiday get-together.  What could go wrong?  Too much, unfortunately.  Employees may drink too much, act inappropriately, offend co-workers or guests, hurt themselves or others, or even start a brawl. Depending on the circumstances, your company may find itself potentially liable for the inappropriate or unlawful actions of your employees at company-sponsored parties.  You can help minimize the risks associated with holiday parties by following these five tips.

  • Avoid or Limit Alcohol

Employers face potential liability when providing alcohol at a company holiday event when someone gets hurt due to drunk driving, falling down, etc., or when inappropriate behavior crosses the line from embarrassing to unlawful, such as sexual harassment or violence during an argument.  You can limit your company’s exposure for such conduct by either banning alcohol entirely (we know that may not be well-received in some situations), or limiting each person’s consumption through the use of drink tickets or a 2-drink limit.  If you choose to allow alcohol at your events, don’t allow free access to the alcohol (e.g., open bar, self-serve beer or unlimited wine bottles).  Instead have a professional, licensed bartender serve the alcohol as they are trained not to over-serve patrons.  Be sure to offer plenty of food and non-alcoholic beverages.  Arrange for taxis or hotel stays if someone over-indulges.  Schedule the event during the week so folks are less inclined to get carried away. Set an end time for the party and shut down the bar at least a half hour before the event closes.  Do not authorize or condone “after parties.” Finally, designate some supervisors or managers to refrain from drinking alcohol to make sure things don’t get out of hand.

  • Keep Harassing Behavior in Check

Make sure that your sexual harassment policy is up-to-date and that it applies to company parties, even if held off company premises.  Send out a reminder to employees in advance of the party that all company policies, including those prohibiting harassment and other inappropriate conduct, apply to the party. Consider making the event a family party where employees may bring their spouse, significant other, or children as the presence of family members and children often deters inappropriate behavior which could give rise to a harassment complaint.  Make sure that supervisors and managers watch out for potentially harassing conduct and are trained to intervene as necessary.

  • Respect Religious Differences and Keep the Party Neutral 

Although many holidays toward the end of the year are religious in nature, be sensitive to your employees’ varying religious beliefs and avoid any conduct that could be construed as favoring one religious group over another.  Refrain from calling your party a “Christmas Party” and stick with the neutral “Holiday Party” instead.  Do not make attendance at the company-sponsored events such as parties, volunteer activities, food drives or other holiday outings mandatory.  Make sure the timing of the company party does not exclude any employees for religious reasons.  For example, because the Jewish Sabbath starts on Friday night, a party on a Friday evening may exclude Jewish employees.  Avoid decorating with religious symbols, such as nativity scenes, menorahs or angels.  There are plenty of neutral decorations, such as snowflakes, holly and reindeer, that can be used instead.

  • Be Wary of Gift Exchanges

Gift exchanges between employees may seem innocuous enough, but consider the potential issues a gift exchange may cause.  Employees may not be able to afford to participate, even within a recommended cost guideline.  Other employees may give sexy or “funny” gifts that end up offending others.  The best practice is to avoid a company or department sponsored gift exchange altogether.  If you decide to allow one among your employees, make sure it is entirely voluntary and no one is pressured or made to feel uncomfortable for not participating.  Set cost guidelines and remind participants that gifts must be appropriate for the workplace.

  • Remember Wage and Hour Laws

If you assign any non-exempt employees to plan, prepare for and staff the party, their hours are likely work hours for which they must be paid.  For example, if your office receptionist is required to be at the door of your holiday party to greet guests and hand out name tags, that individual is likely working and you need to include those hours in his or her weekly work hours when determining regular and overtime wages.  You do not need to pay employees who are attending the party if their attendance is voluntary and they are not expected to provide services that benefit your organization.

Follow this checklist and you’ll avoid last minute holiday headaches and keep your organization out of trouble.

Copyright Holland & Hart LLP 1995-2015.

January 2016 Visa Bulletin Update

The Department of State’s (DOS) January 2016 Visa Bulletin showed minor movements in the employment-based visa categories. The most significant movement was in the Indian EB-2 category which advanced by another 8 months, to Feb. 1, 2008 (the December 2015 bulletin showed a 10 month jump). There was also movement in the Dates for Filing in the employment-based categories, except in both of the “All Chargeability Areas” and “Mexico” EB-3 and Other Workers categories, which moved from Sept. 1, 2015, to Jan. 1, 2016.

The January Visa Bulletin also advised about the upcoming, scheduled expiration of the immigrant investor pilot program (EB-5 Visas) on Dec. 11, 2015, unless Congress acts to extend these programs. The Visa Bulletin states that no I5 visas may be issued overseas, or final action taken on adjustment of status cases, after Dec. 11, 2015. The cut-off date for this category has been listed as “unavailable” for January. Congress is currently considering an extension of the I5 visa category, but there is no certainty when such legislative action may occur. If there is legislative action that extends this category for FY-2016, the cut-off dates would immediately become “current” for January, for all countries except China-mainland born I5.

Final Action Dates for Employment-Based Preference Cases

imm blog 1

Dates for Filing of Employment-Based Visa Applications

imm blog 2

©2015 Greenberg Traurig, LLP. All rights reserved.

Regulating Recording Features of Personal Wearable Technology in Workplace

With each passing day, personal wearable technology, like the Apple Watch and Google Glass, becomes more mainstream and technologically advanced.  Employers should be aware of the challenges posed by employees wearing their technology into the workplace.  Businesses have already had to consider decreased productivity, exposure to computer viruses, and potential data breaches caused by personal wearable technology in the workplace. In addition, employers are now wondering if personal wearable devices are being used to discretely and instantaneously record events and copy information in the workplace. Several employment laws are implicated when employers seek to regulate the recording features of personal wearable technology in the workplace.

Restrictions on personal wearable technology in the workplace are subject to Section 7 of the National Labor Relations Act, which prohibits workplace rules and policies that chill discussions among non-management employees about wages, working conditions, work instructions, and the exercise of other concerted activities for mutual aid or protection.  NLRB General Counsel Memorandum No. 15-04  contains examples of both over broad and lawful work rules restricting recording devices in the workplace.  These examples are instructive when drafting employment policies restricting personal wearable devices.

Under Section 7, employers may prohibit employees from copying or disclosing confidential or proprietary information about the employer’s business, using wearable technology or otherwise.  Employers may also prohibit employees from taking, distributing, or posting on social media pictures, video, and audio recordings of work areas while on working time, so long as the policy carves an exception for conduct protected by Section 7.  The exception should expressly cite specific examples of permitted recordings, such as “taking pictures of health, safety and/or working condition concerns or of strike, protests and work-related issues and/or other protected concerted activities.”  Existing employment policies restricting personal cell phone and camera use in the workplace should be updated to include restrictions on the use of recording features of wearable technology.

The recording features of personal wearable technology also provide new methods and means for employees to engage in unlawful workplace harassment and other workplace misconduct.  Employers should consider revising their anti-harassment and conduct policies to prohibit the use of wearable technology, including its recording features, in an unlawful manner.  As technology continues to evolve, so too should employment policies, to address the use of such personal devices in the workplace.

Article By Stan Hill of Polsinelli PC