Category: Labor & Employment

U.S. Supreme Court Gives Increased Protection to Government Employees

The Supreme Court recently ruled unanimously that government employees who testify about public corruption are protected by the First Amendment. The case, Lane v. Franks,[1] centered on a public employee, Lane, who worked at an Alabama community college where he led the school’s program for at-risk youth.

While working for the community college, Lane discovered a state representative was on the program’s payroll, despite doing no work for the program. Lane terminated the representative’s employment, and subsequently, the representative was indicted by federal authorities on corruption-related charges. Lane testified, under subpoena, at the representative’s trial in 2008. In 2009, Lane was fired from the college. Lane sued the community college president individually and in his official capacity alleging that the official violated his First Amendment protections.

The college president argued that Lane’s sworn testimony was not protected by the First Amendment because it was based on information that he gathered from his role as a state employee, not as a private citizen. The lower courts agreed with the college president, determining that Lane acted in his official capacity when firing the state representative and had acted in the same capacity when testifying at her trial. The Supreme Court disagreed and stated that Lane testified “as a citizen on a matter of public concern.” According to Justice Sotomayor, “Truthful testimony under oath by a public employee outside the scope of his ordinary job duties is speech as a citizen for First Amendment purposes. That is so even when the testimony relates to his public employment or concerns information learned during that employment.”

The ruling means that government employees should feel more protected when stepping forward with whistleblower-type information. Both public and private employers should exercise caution when taking negative actions against an employee who has complained of or filed a charge of discrimination, or participated in some kind of investigation or proceeding, as the action could be considered retaliatory.

[1] No. 13-483 (2014).

Article By:

Luke A. Wingfield
Of:
McBrayer, McGinnis, Leslie and Kirkland, PLLC

The Walls Shouldn’t Have Ears: Ruling on Eavesdropping Puts Burden of Prevention on Illinois Employers

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Are your employees surreptitiously recording conversations? It’s a frightening thought. But based upon a new Illinois Supreme Court ruling, they are now free to do so. To discourage this behavior, Illinois employers should consider implementing a policy prohibiting such surreptitious recordings.

In People v. Clark, the Illinois Supreme Court ruled that the state eavesdropping statute, which had made it illegal to record conversations in Illinois without the consent of all parties, was unconstitutionally overbroad under the First Amendment. The state Supreme Court reasoned that audio and audiovisual recordings are “medias of expression commonly used for the preservation and dissemination of information and ideas and thus are included within the free speech and free press guarantee” of the First Amendment.

Consider for a moment how your employees might use secretly recorded conversations against you. An employee who has previously complained to your human resources department about another employee who made inappropriate sexist or racist comments, may now freely record all conversations with the colleague, and can use those recordings in a lawsuit against the company. Or, an employee might surreptitiously record everything said during an internal investigation of alleged wrongdoing by the company, and could then provide third parties with those recordings.

Given the removal of statutory barriers, Illinois employers are now forced to create their own systems for preventing this objectionable conduct. One such avenue would be to implement a policy prohibiting the recording of conversations absent the consent of all parties.

Under certain circumstances, employers may want to record workplace conversations. However, the employer, not each individual employee, should dictate when recording conversations is appropriate. Company policy should be unequivocal and forbid the recording of any conversations with colleagues or business conversations with third parties, regardless of where such conversations take place, without the consent of all parties to the conversation.

Note that such a policy would not prohibit an employee from using such surreptitious recordings in a lawsuit against the company, or from sharing such recordings with others, because Illinois law no longer requires the consent of all parties. But with clear guidelines in place, Illinois employers would at least have the option of taking disciplinary action against employees who violate the company’s policy. Employees generally don’t want to risk losing their jobs by violating such rules, and may therefore think twice before making secret recordings.

In response to the concerns of employers and others, the Illinois General Assembly is already considering new legislation that would limit the recording of conversations in a way that does not violate the Constitution. And while Illinois employers should monitor the progress of such prospective legislation, adoption of a company policy prohibiting the secret recording of conversations can help reduce the likelihood of such behavior in the interim.

Article By:

Robert K. Neiman
Of:
Much Shelist, P.C.

U.S. Supreme Court Upholds D.C. Circuit Decision in Noel Canning

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In a lengthy opinion authored by Justice Stephen Breyer, and drawing heavily on historical practice of Presidents and the Senate, the United States Supreme Court has upheld the decision of the U.S. Court of Appeals for the D.C. Circuit in Noel Canning v. NLRB, concluding that President Obama’s three recess appointments to the National Labor Relations Board in January 2012 (Sharon Block, Richard Griffin, and Terence Flynn) were invalid. The Court upheld the right of the President to make recess appointments both inter- and intra-session, but held that it is the Senate that decides when it is in session by retaining the power to conduct business pursuant to its own rules. The Court also found that a recess of less than ten days “is presumptively too short” to permit the President to make a recess appointment, except in “unusual circumstances”, such as a “national catastrophe”. (The recess here was three days.) The Court also decided that the recess appointment power applies to appointments that first come into existence during a recess and to those that initially occur before a recess but continue to exist during a recess.

As a result of the decision, over 1,000 Board decisions likely are now invalid. According to the National Right to Work Foundation, 999 unpublished decisions and 719 published decisions (totaling 1,718) could be affected. The Chamber of Commerce estimates 1,302 decisions from August 27, 2011 through July 17, 2013 to be suspect.

Article By:

Howard M. Bloom
Of:
Jackson Lewis P.C

Wisconsin’s Password Protection Law Mandates Review of Policies and Practices

Godfrey Kahn

Wisconsin has joined the ranks of other states who have limited the circumstances under which employees or applicants can be required to provide access to his or her personal Internet account. The Social Media Protection Act (2013 Wisconsin Act 208) became effective April 16, 2014. The new law makes it illegal for an employer to request or require an employee or applicant to disclose personal Internet account access information. A parallel prohibition within the Act applies to educational institutions and landlords.

A “personal Internet account” is defined as an Internet-based account that is created and used by an individual exclusively for purposes of personal communications. With the passage of the Act, employers are now prohibited from:

  • Requesting or requiring an employee or applicant, as a condition of employment, to disclose access information to the individual’s personal Internet account or to ask the individual to grant access to or allow observation of that account.
  • Discharging or otherwise discriminating against an employee for exercising his/her right to refuse to disclose personal Internet account access information.
  • Refusing to hire an applicant because the individual did not disclose personal Internet account access information.

While the law primarily protects the privacy of employees and applicants, it also offers employers a limited degree of protection. Specifically, employers can:

  • Request or require an employee to disclose access information to the employer in order for the employer to gain access to or operate an employer-provided (or employer-paid) electronic communications device provided by virtue of the employee’s employment relationship or used for the employer’s business purposes.
  • Discharge or discipline employees for transferring proprietary or confidential information or financial data to the employee’s personal Internet account without the employer’s authorization.
  • If the employer has reasonable cause, conduct an investigation or require an employee to cooperate in an investigation of any alleged unauthorized transfer of the employer’s proprietary or confidential information or financial data to the employee’s personal Internet account or to conduct an investigation of any other alleged employment-related misconduct, violation of the law or violation of the employer’s work rules. During the investigation, the employer can require the employee to grant access to or allow observation of the employee’s personal Internet account, but may not require the employee to disclose access information for that account.
  • Restrict or prohibit an employee’s access to certain Internet sites, while using an employer-provided (or paid for) electronic communications device, or while the employee is using the employer’s network or other resources.
  • View, access or use information about an employee or applicant that can be obtained without access information or that is available in the public domain.
  • Request or require an employee to disclose his or her personal electronic mail address.

A person who has been discharged, expelled, disciplined, or otherwise discriminated against for reasons provided under this law may file a complaint with Wisconsin’s Department of Workforce Development (the “DWD”).

Employers should make sure that their employment policies and practices conform to the requirements of 2013 Wisconsin Act 208. In particular, employers should make sure that employees using employer-provided or paid for electronic communication devices for business purposes do not have any expectation of privacy in such devices or the communications that flow from them.

In addition, employees should be informed that they are prohibited from disclosing proprietary or confidential information or financial data to anyone using personal Internet accounts and only for legitimate business reasons if using an employer-provided account. Lastly, employers should make sure that their employment policies are clear in reserving the right to conduct, and in expecting employees to cooperate in, investigations concerning the unauthorized transfer of proprietary, confidential or financial information.

Article By:

Jon E. Anderson
Of:
Godfrey & Kahn S.C.

Michigan Minimum Wage Increases Enacted

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Michigan Governor Rick Snyder has signed the Workforce Opportunity Wage Act, mandating gradual increases in the state’s minimum wage to $9.25 an hour by January 1, 2018. The Act ties increases to the rate of inflation beginning 2019.

The first of four raises mandated by Senate Bill 934 (Public Act 138), to $8.15 an hour, occurs September 1, 2014. Michigan’s minimum wage since 2008 has been $7.40 an hour for workers who do not receive a tip and $2.65 an hour for workers earning tips, such as waiters.

Also beginning September 1, 2014, tipped employees would have a minimum rate that is 38 percent of the minimum for non-tipped workers, or about $3.51 an hour.

The state’s hourly minimum for non-tipped workers will increase as follows:

  • Beginning September 1, 2014, to $8.15.
  • Beginning January 1, 2016, to $8.50.
  • Beginning January 1, 2017, to $8.90.
  • Beginning January 1, 2018, to $9.25.

Starting in 2019, minimum wage increases will be tied to the rate of inflation, but any increase will be capped at 3.5 percent a year. The rate will adjust annually based on a five-year rolling average of inflation for the Midwest. Annual increases would take effect on April 1 of each year. No increase would occur if the state’s unemployment rate for the preceding year was 8.5 percent or higher.

Several other states, including Delaware and Minnesota, also have adopted increases this year, and the minimum wage for workers on new federal contracts has been raised to $10.10 per hour.

Article By:

Maurice G. Jenkins
Matthew Scott Disbrow
Of:
Jackson Lewis P.C.

Department of State Releases July 2014 Visa Bulletin

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Bulletin shows nearly four years of advancement in the EB-2 category for applicants chargeable to India and minor advancement for applicants chargeable to China as well as significant advancement in the EB-3 category for applicants chargeable to the Philippines, minor advancement for applicants chargeable to India, and no change for applicants chargeable to China, Mexico, or the Rest of the World.

The U.S. Department of State (DOS) has released its July 2014 Visa Bulletin. The Visa Bulletin sets out per-country priority date cutoffs that regulate the flow of adjustment of status (AOS) and consular immigrant visa applications. Foreign nationals may file applications to adjust their statuses to that of permanent residents or to obtain approval of immigrant visas at a U.S. embassy or consulate abroad, provided that their priority dates are prior to the respective cutoff dates specified by the DOS.

What Does the July 2014 Visa Bulletin Say?

In July, the cutoff date for applicants in the EB-2 India category will advance by nearly four years, while the cutoff date for applicants in the EB-2 China category will advance by only 40 days. Meanwhile, the cutoff date in the EB-3 India category will advance by 17 days, while the cutoff date in the EB-3 China category will remain unchanged. The cutoff date in the F2A category for applicants from all countries will also remain unchanged.

EB-1: All EB-1 categories will remain current.

EB-2: The cutoff date for applicants in the EB-2 category chargeable to India will advance by nearly four years to September 1, 2008. The cutoff date for applicants in the EB-2 category chargeable to China will advance by 40 days to July 1, 2009. The EB-2 category for all other countries will remain current.

EB-3: The cutoff date for applicants in the EB-3 category chargeable to India will advance by 17 days to November 1, 2003. The cutoff date for applicants in the EB-3 category chargeable to China will remain unchanged at October 1, 2006. The cutoff date for applicants in the EB-3 category chargeable to the Philippines will advance by one year to January 1, 2009. The cutoff date for applicants chargeable to Mexico and all other countries will remain unchanged at April 1, 2011.

The relevant priority date cutoffs for foreign nationals in the EB-3 category are as follows:

China: October 1, 2006 (no movement)
India: November 1, 2003 (forward movement of 17 days)
Mexico: April 1, 2011 (no movement)
Philippines: January 1, 2009 (forward movement of 366 days)
Rest of the World: April 1, 2011 (no movement)

Developments Affecting the EB-2 Employment-Based Category

Mexico, the Philippines, and the Rest of the World

The EB-2 category for applicants chargeable to all countries other than China and India has been current since November 2012. The July Visa Bulletin indicates no change, meaning that applicants in the EB-2 category chargeable to all countries other than China and India may continue to file AOS applications or have applications approved through July 2014.

China

The June Visa Bulletin indicated a cutoff date of May 22, 2009 for EB-2 applicants chargeable to China. The July Visa Bulletin indicates a cutoff date of July 1, 2009, reflecting forward movement of 40 days. This means that applicants in the EB-2 category chargeable to China with a priority date prior to July 1, 2009 may file AOS applications or have applications approved in July 2014.

India

In December 2013, the cutoff date for EB-2 applicants chargeable to India retrogressed significantly to November 15, 2004 because of unprecedented demand in this category. This cutoff date remained constant through June. The July Visa Bulletin indicates a cutoff date of September 1, 2008, reflecting forward movement of nearly four years (1,386 days). This means that applicants in the EB-2 category chargeable to India with a priority date prior to September 1, 2008 may file AOS applications or have applications approved in July 2014.

Developments Affecting the EB-3 Employment-Based Category

China

In late 2013 and early 2014, the cutoff date for EB-3 applicants chargeable to China advanced significantly to generate demand in this category. In June, to regulate demand, this cutoff date retrogressed by six years to October 1, 2006. The July Visa Bulletin indicates no change to this cutoff date. This means that only applicants in the EB-3 category chargeable to China with a priority date prior to October 1, 2006 may continue to file AOS applications or have applications approved in July 2014.

India

The June Visa Bulletin indicated a cutoff date of October 15, 2003 for EB-3 applicants chargeable to India. The July Visa Bulletin indicates a cutoff date of November 1, 2003, reflecting forward movement of 17 days. This means that only EB-3 applicants chargeable to India with a priority date prior to November 1, 2003 may file AOS applications or have applications approved in July 2014.

Rest of the World

From September 2013 through April 2014, the cutoff date for EB-3 applicants in the worldwide category advanced by 3.75 years. In June, to regulate the high demand, the cutoff date in this category retrogressed by 549 days to April 1, 2011. The July Visa Bulletin indicates no change to this cutoff date. This means that only applicants in the EB-3 category chargeable to the Rest of the World with a priority date prior to April 1, 2011 may file AOS applications or have applications approved in July 2014.

Developments Affecting the F2A Family-Sponsored Category

In March, as a result of heavy demand in the F2A category from applicants chargeable to Mexico, the cutoff date in this category retrogressed significantly to April 15, 2012. In June, this cutoff date retrogressed again to March 15, 2011. The July Visa Bulletin indicates no change to this cutoff date. This means that only those applicants from Mexico with a priority date prior to March 15, 2011 will be able to file AOS applications or have applications approved in July 2014.

During fiscal year 2013, in an effort to generate demand in the F2A category from applicants from all countries other than Mexico, the cutoff date in this category advanced significantly. This advance resulted in a dramatic increase in demand, followed in June by a further retrogression of the cutoff date to May 1, 2012. The July Visa Bulletin indicates no change to this cutoff date. This means that only those F2A applicants from countries other than Mexico with a priority date prior to May 1, 2012will be able to file AOS applications or have applications approved in July 2014. Further retrogression of the worldwide F2A category should not be ruled out.

How This Affects You

Priority date cutoffs are assessed on a monthly basis by the DOS, based on anticipated demand. Cutoff dates can move forward or backward or remain static. Employers and employees should take the immigrant visa backlogs into account in their long-term planning and take measures to mitigate their effects. To see the July 2014 VisaBulletin in its entirety, please visit the DOS website here.

Article by:
Eric S. Bord
Lisa Stephanian Burton
Tracy Evlogidis
Malcolm K. Goeschl
Eleanor Pelta
Of:
Morgan, Lewis & Bockius LLP

Wisconsin Federal Court Recognizes Same-Sex Marriage: How Does This Affect the Administration of an Employer’s Employee Benefits?

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On Friday, June 6, 2014, Judge Crabb of the U.S. District Court for the Western District of Wisconsin issued a decision finding that Wisconsin’s constitutional amendment recognizing marriages only between men and women violates the Equal Protection Clause of the U.S. Constitution.

Unlike several other federal judges who have considered the issue, Judge Crabb did not make her ruling immediately effective. Instead the Court asked the plaintiffs’ lawyers in the case to help her fashion an injunction to implement her ruling. The plaintiffs have until June 16, 2014, to submit this proposal. The State asked for clarification on the June 6, 2014 ruling and requested that the court stay its decision until it made a final decision on the scope of the injunctive relief. On June 9, 2014, the court denied the State’s motion. In response, the State appealed Judge Crabb’s decision to the U.S. Court of Appeals for the Seventh Circuit in Chicago and requested an immediate stay of Judge Crabb’s order. The Seventh Circuit has solicited arguments from the parties to determine whether it has jurisdiction of the matter.

In response to Judge Crabb’s decision, many of the State’s counties have begun issuing marriage licenses to same-sex couples in the state. Others have declined to do so and have, instead, sought guidance from counsel or the Attorney General.

Addressing the Change

Judge Crabb’s decision, and issuance of Wisconsin same-sex marriage licenses, has injected some uncertainty into benefit plan administration in Wisconsin. Based upon the state of the prior law, it is likely that a Wisconsin employer will have more employees with domestic partners than employees with same-sex spouses through legal marriages formed elsewhere. Nevertheless, same-sex benefits are certainly an evolving issue for employers.

Family and Medical Leave

Registered and unregistered domestic partners were already covered under the Wisconsin Family and Medical Leave Act. Because an unregistered domestic partnership does not require a formal filing with a county clerk, it appears that the state law in this context is relatively unaffected.

On the other hand, the federal FMLA is substantially affected. The definition of spouse under the federal regulations requires that the marriage must be recognized by the state of residence. Most FMLA policies do not distinguish between same-sex and opposite-sex partners. Consequently, if Judge Crabb’s decision stands, requests for FMLA leave relating to same-sex spouses must be recognized under both federal and Wisconsin law if the leave is otherwise appropriate under the law.

Until the ramifications of the injunctive language are known, employers should pay particular attention to the language of their FMLA policies before making any determination about FMLA requests. Depending on how the courts ultimately rule, an employer’s FMLA policy may or may not require amendment. Regardless, if an employee asks about leave for a same-sex spouse, legal counsel should be consulted.

Benefits

The status of the law will remain uncertain until Judge Crabb makes a decision regarding whether to issue an injunction and the form such an order would take. If an injunction is issued and then stands following the anticipated appeal, employers who employ employees who have a same-sex spouse would no longer impute Wisconsin income tax for health coverage, and would otherwise recognize such spouse for all legal purposes. Because of the uncertainty in the current climate, employers should consider whether to continue imputing income for benefits provided to same-sex spouses until such time as transitional guidance is issued by the Wisconsin Department of Revenue on this issue.

Nothing has changed as it relates to unmarried domestic partners—these individuals are still subject to imputed income where the individual obtains coverage on behalf of his or her domestic partner.

Because employee benefits rules are largely governed by federal law, many same-sex marriage changes in employee benefits have been observed already since the U.S. Supreme Court’s Windsor decision of last year. If the Judge Crabb ruling stands, the most significant change for Wisconsin employers will likely pertain to Wisconsin tax treatment of family health coverage.

What should employers do in response?

  • Account for those same-sex couples who may have been married in a state that permitted same-sex marriage or who are newly married in Wisconsin following Judge Crabb’s decision;
  • Examine if modification of FMLA policy/forms is warranted based upon the changes; and
  • Examine if modification to benefit plan materials may be necessary.
Article By:

Charles P. Stevens
Kirk A. Pelikan
Of:
Michael Best & Friedrich LLP

The Affordable Care Act—Countdown to Compliance for Employers, Week 29: Wellness Programs, Smoking Cessation and e-Cigarettes

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The Health Insurance Portability and Accountability Act of 1996 (HIPAA) generally prohibits discrimination in eligibility, benefits, or premiums based on a health factor, except in the case of certain wellness programs. Final regulations issued in 2006 established rules implementing these nondiscrimination and wellness provisions. TheAffordable Care Act largely incorporates the provisions of the 2006 final regulations (with a few clarifications), and it changes the maximum reward that can be provided under a “health-contingent” wellness program from 20 percent to 30 percent. But in the case of smoking cessation programs, the maximum reward is increased to 50 percent. Comprehensive final regulations issued in June 2013 fleshed out the particulars of the new wellness program regime.

Health-contingent wellness programs require an individual to satisfy a standard related to a health factor to obtain a reward. The final rules divide health-contingent wellness programs into the following two categories: activity-only programs, and outcome-based programs. As applied to smoking cessation, an “activity-only program” might require an individual to attend a class to obtain the reward. In contrast, an outcome-based program would require an individual to quit smoking, or least take steps to do so under complex rules governing alternative standards.

Nowhere do the final regulations address the role of electronic cigarettes (or “e-cigarettes”). Simply put, the issue is whether an e-cigarette user is a smoker or a nonsmoker? (According to Wikipedia, an electronic cigarette (e-cig or e-cigarette), “is a battery-powered vaporizer which simulates tobacco smoking by producing a vapor that resembles smoke. It generally uses a heating element known as an atomizer that vaporizes a liquid solution.”) But questions relating to e-cigarettes are starting to surface in the context of wellness program administration. Specifically:

  1. Is an individual who uses e-cigarettes a “smoker” for purposes of qualifying, or not qualifying, for a wellness program reward, and
  2. May a wellness program offer e-cigarettes as an alternative standard, i.e., one that if satisfied would qualify an individual as a non-smoker?

Is an individual who uses e-cigarettes a “smoker” for purposes of qualifying, or not qualifying, for a wellness program reward?

While the final rules don’t mention or otherwise refer to e-cigarettes, they do provide ample clues to support the proposition that smoking cessation involves tobacco use. Here is the opening paragraph of the preamble:

SUMMARY: This document contains final regulations, consistent with the Affordable Care Act, regarding nondiscriminatory wellness programs in group health coverage. Specifically, these final regulations increase the maximum permissible reward under a health-contingent wellness program offered in connection with a group health plan (and any related health insurance coverage) from 20 percent to 30 percent of the cost of coverage. The final regulations further increase the maximum permissible reward to 50 percent for wellness programs designed to prevent or reduce tobacco use. (Emphasis added.)

There is also a discussion in the preamble about alternative standards (79 Fed Reg. p. 33,164 (middle column)), which reads in relevant part:

The Departments continue to maintain that, with respect to tobacco cessation, ‘‘overcoming an addiction sometimes requires a cycle of failure and renewed effort,’’ as stated in the preamble to the proposed regulations. For plans with an initial outcome-based standard that an individual not use tobacco, a reasonable alternative standard in Year 1 may be to try an educational seminar. (Footnotes omitted.)

In addition, the final regulations’ Economic Impact and Paperwork Burden section is replete with references to tobacco use, as are the examples (see Treas. Reg. § 54.9802-1(f)(4)(vi), examples 6 and 7).

On the other hand, the definition of what constitutes a participatory wellness program refers simply to “smoking cessation” (Treas. Reg. § 54.9802-1(f)(1)(ii)(D)), and the definition of an outcome-based wellness program (Treas. Reg. § 54.9802-1(f)(1)(v)) simply refers to “not smoking.” In neither case is there any reference to tobacco.

The Affordable Care Act’s rules governing wellness programs are included in the Act’s insurance market reforms, which take the form of amendments to the Public Health Service Act that are also incorporated by reference in the Internal Revenue Code and the Employee Retirement Income Security Act (ERISA). By virtue of being included in ERISA, participants have a private right of action to enforce these rules. So an employer that wanted to treat the use of e-cigarettes as smoking in order to deny access to a wellness reward would likely confront arguments similar to those set out above in the event of a challenge.

May a wellness program offer e-cigarettes as an alternative standard, i.e., one that if satisfied would qualify an individual as a non-smoker?

This is perhaps a more difficult question. May an employer designate e-cigarette use as an alternative standard? Anecdotal evidence suggests that employers are not doing so, at least not yet. But could they do so? And would it make a difference whether the e-cigarette in question used a nicotine-based solution as opposed to some other chemical? (According to Wikipedia, “solutions usually contain a mixture of propylene glycol, vegetable glycerin, nicotine, and flavorings, while others release a flavored vapor without nicotine.”) The answer in each case is, it’s too soon to tell.

The benefits and risks of electronic cigarette use are uncertain, with evidence going both ways. Better evidence would certainly give the regulators the basis for further rulemaking in the area. In the meantime, the final regulations’ multiple references to tobacco, and by implication, nicotine, seem to furnish as good a starting point as any. This approach would require a wellness plan sponsor to distinguish between nicotine-based and non-nicotine-based solutions, which may prove administratively burdensome.

The larger question, which may take some time to settle, is whether e-cigarettes advance or retard the cause of wellness. Absent reliable clinical evidence, regulators and wellness plan sponsors have little to guide their efforts or inform their decisions as to how to integrate e-cigarettes into responsible wellness plan designs. Complicating matters, the market for e-cigarettes is potentially large, which means that reliable (read: unbiased) clinical evidence may be hard to come by. For now, all plan sponsors can do is to answer the questions set out above in good faith and in accordance with their best understanding of the final regulations.

Article By:

Alden J. Bianchi
Of:
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.

 

Settlement Between U.S. Department of Labor and Oregon Blueberry Growers Vacated

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In 2012, the Department of Labor accused Oregon blueberry growers of employing “ghost workers” resulting in minimum wage violations. The DOL then issued what is known as a “hot goods order” to block shipment of their product to market until the violations were remedied.  This, of course, created an untenable situation for the blueberry producers as their products were highly perishable. With no real alternative, the blueberry growers signed consent agreements with the DOL, in which they agreed to substantial fines and waived their rights to contest the allegations.

The blueberry growers later challenged the consent judgment and in January a federal magistrate judge agreed with the growers finding that “the tactic of putting millions of dollars of perishable goods in lock up was unlawfully coercive.” That decision was upheld just last week by the United States district judge. Invaliding consent judgments, particularly those with the federal government, is extremely difficult and rarely happens. But in this case, the combination of over-the-top, coercive of tactics by the DOL, as well as the court’s view that there was little or no evidence of underlying labor violations to begin with, paved the way for the growers in this case.

Article By:

Aaron M. Phelps
Of:
Varnum LLP

Rights of Job Applicants in Germany

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The German Federal Labor Court made a very clear ruling regarding job applicants in Germany who are not offered the position for which such applicants applied.  In the Federal Labor Court’s view, a rejected applicant has no right to know whether another applicant was offered or accepted the position.  (Federal Labor Court, verdict dated April 25, 2013, case number 8 AZR 287/08)

This case concerned a plaintiff who was born in the former Soviet Union in 1961.  She applied for a position that was advertised by a German company, the defendant in this case.  Even though the plaintiff fulfilled all required qualifications, she was rejected and did not receive a job offer.  The plaintiff presumed that this decision was based on discrimination for her gender, age and origin.  The Federal Labor Court submitted the case to the European Court of Justice to determine whether the job applicant had a right to information regarding why she was not selected, or if another applicant was selected for the position.  The European Court of Justice rendered its verdict on April 19, 2012 (case number C415/10), and stated that rejected job applicants had no right to this information under European law.

The German Federal Labor Court dismissed the case because it could not detect any evidence of discrimination.  The mere refusal of the defendant to disclose any information related to the application process and/or the hiring could not establish the presumption of an inadmissible discrimination, according to Section 7 of the German General Equal Treatment Act.

However, this ruling has to be viewed with great caution.  The German decision is not in line with the aforementioned ruling in the same matter of the European Court of Justice.  The European judges, in contrast to the German Court, stressed that the complete refusal to give out any information regarding the hiring could actually be evaluated as a presumption of possible discrimination.  This remarkable difference in the two verdicts was not explained by the German judges and as long as their reasoning remains unclear, German employers should provide a short explanation to rejected applicants when they ask the reason why they have been rejected for an open position (e.g., the other candidate better satisfies the qualification profile, made a better impression at the job interview, seems to be a more motivated and energetic person, etc.).

Article By:

Dr. Sandra Urban-Crell
Gudrun Germakowski
Of:
McDermott Will & Emery