Tag: employee

Employees Miffed by Your Monitoring of Company Devices? Give Notice Now to Hopefully Avoid Annoyance Later

We’ve talked about social media policies several times over the years, but it’s been a while since we’ve discussed monitoring your employees’ work phones, emails, and internet usage. As you most likely know, you can and probably should monitor employees’ work phones, emails, and internet usage. You never know when someone outside the business will require you to produce emails (hello, subpoenas or litigation). But, how do you protect your business upfront from employees who are miffed by your monitoring? One of the best ways is to provide notice to your employees that you are watching.

In fact, effective May 7, 2022, the state of New York will require all employers to provide notice to employees that their work phones, email, and internet use is monitored. The new law requires the following for new hires:

  • Written notice (hard copy or electronic) to all who are subject to electronic monitoring
  • Written acknowledgment (hard copy or electronic) of the notice

As for current employees, no written acknowledgement is required but employers must post notice about electronic monitoring. Failure to meet these requirements could result in civil penalties up to $500 for the first offense, $1,000 for the second, and $3,000 for any subsequent offense.

Even if you are not operating in New York or another state that requires notice, we suggest you take the time now to review your onboarding materials and policies and, if you don’t already have one, implement a policy related to monitoring work phones, emails, and internet usage. Providing your employees with your expectations about their electronic usage and notice that you are monitoring their use of company devices could save you from headaches in the future. Here are a few tips:

  • Review and revise any existing policies related to work phones, emails, and internet usage to include your expectations and let them know you are monitoring and will discipline employees for misuse
  • Identify what devices may be monitored (tip: it’s best to limit monitoring to company devices but we understand gray areas may arise and advise you to speak with counsel about those issues)
  • Include the policy and acknowledgement of receipt in the onboarding materials (which will keep you compliant in New York)
  • If you have annual training for employees, consider including a brief section that covers and reminds employees about the policy
  • Also, if you discuss prohibitions in your policy, remember to make clear that there is no prohibition on employees’ rights to engage in discussion of terms and conditions of employment (as that could be protected, concerted activity under the National Labor Relations Act)

This article was written by Cortlin Bond and Anne R. Yeungert of Bradley Arant Boult Cummings law firm. For more articles about employee monitoring, please see here.

Stopping Harassment Before it Starts Includes Dealing with Bullying

Toxic workplaces have been making plenty of headlines lately.  Recent stories about toxic workplaces – and some of the fallout – have spanned all sorts of industries, from the government to video gaming to professional sports.

What makes a workplace toxic?  There’s probably an academic definition (or two), but what’s intended for the purposes of this article is behavior that is intimidating, demeaning or belittling, and is either severe, ongoing or both.  It typically involves someone taking advantage of a power difference, real or perceived.  The power difference may come from the official position or title, it may come from a long tenure with the organization, it may come from namedropping or sense of connections to power within the organization, and it may come from being a rainmaker, superstar, or someone identified as high potential.  The person or group on the receiving end lacks such power and often receives a message, not always in so many words, that any complaint will not be believed or taken seriously.  Critically, there are usually instances of demonstrating poor behavior in front of others, without intervention or acknowledgment, signaling the behavior is accepted.

A toxic workplace can be especially difficult to deal with because rude (or worse) behavior, unless tied to a protected characteristic, is not necessarily harassment or discrimination under the law.   Even the Supreme Court says companies are not required to be manners police, and most certainly do not want to be tasked with managing the manners of our coworkers.  After all, we are all capable of an off day when we are not as kind or considerate as we aspire to be.  We hesitate to call out the poor behavior in someone else, either to avoid embarrassment or confrontation, because it’s not a good time and then it’s too late, or because it could be us the next time.  Unfortunately, this tolerance likely contributes to a bigger problem, allowing the poor behavior to grow into illegal harassment.

The problem is not new.  In 2016, the EEOC reported that training to stop or prevent harassment was largely missing the mark.  Among other things, the EEOC suggested training focus more on preventing poor behavior(s) that tends to escalate into harassment, namely bullying.

With that suggestion in mind, what should be done to improve processes? What can you do?

  • Make sure your training programs address behaviors that are common precursors to harassment or discrimination (either as part of EEOC training or something separate).
  • Consider whether your complaint process would allow or even encourage complaints that do not fit the typical paradigm of unlawful discrimination or harassment.  If not, consider broadening your process or developing something different that can help address concerns before they become formal complaints.  (And be prepared to hear and listen more.)
  • Consider how to ensure appropriate confidentiality but also have a way to recognize a pattern of poor behavior attributed to an individual or group.
  • Don’t communicate tolerance as a bystander.  If you recognize someone is uncomfortable, intervene.  Intervention does not have to be an admonition or correction, it can simply be a diversion.
  • Foster dialogue about how to improve, starting with yourself and those comfortable with you. Are you quick to apologize if you were short with someone? If you made a remark or told a joke that someone that was too stereotypical or otherwise offensive, would someone tell you they had been uncomfortable? To be clear, you probably are not the problem. But more dialogue means more opportunity for everyone to improve and recognize what or who might be a real problem.

These are just a few suggestions and none of them are very easy to accomplish.  But, they do not cost much and may save a lot of money. No one wants to deal with the publicity or litigation that often comes with making the headlines for having a toxic workplace. But, the more common costs are low productivity and high turnover. It’s worth another look.

© 2021 Foley & Lardner LLP
For more articles about employee rights in the workplace, visit the NLR Labor & Employment section.

Mitigating Payment Fraud Risks

For businesses that thrive on person-to-person transactions, cash is quickly being replaced by cards, as well as tap-to-pay systems, mobile wallets and QR-based payment systems. These technologies will continue to dominate the market in the near future, but the long-term future of the payment card industry will likely be shaped by the impact of blockchain and artificial intelligence. These developments will eventually also impact risk management, marketing and financial planning, as they present opportunities for serious risks, including fraud. Hence, it is imperative for risk management professionals to plan for these short- and long-term changes in the industry.

Strong risk monitoring requires proactively assessing threats and planning mitigation measures to minimize risk impact on the company or organization. To help mitigate payment fraud risks, businesses can take the following steps:

Train your Employees Regularly

The more regularly you train your employees, the more likely are they to spot suspicious behavior, no matter what payment technology the business uses. Repeated and regular trainings are essential because employees tend to forget what they have learned with time. These training workshops should teach the workers to never accept damaged cards from customers, confirm customer identities, and never enter a card number manually.

Use Contactless and EMV-Enabled Terminals

As payment technology changes, businesses must evaluate what options are safest and least prone to fraud. Currently, businesses should use EMV (short for Europay, Mastercard and Visa), which involves chips embedded into payment cards—a significant step in making transactions safer. The introduction and adoption of EMV-enabled secure terminals, particularly when using PIN and EMV security together, has helped merchants and customers prevent fraudulent transactions.

Contactless smartcards such as chip and magnetic stripe cards use contactless payment, which can present another secure way to process transactions. Most EMV terminals are also enabled with contactless payment. At such terminals, a fast and secure transaction is possible using Near Field Communication (NFC) or Radio-Frequency Identification (RFID) via smartcard or smartphone. If a merchant chooses to use contactless payment without PIN, they can put a limit to the amount spent on each contactless transaction to further minimize risk.

Beware Uncommon Transactions

Transactions that involve unusually large purchases could be a sign of potential fraud. Businesses should examine such transactions closely and confirm the identity of the customer. Similarly, if several purchases are made with a card in a short timeframe, it could indicate that the card was stolen and being used by someone other than the owner.

Maintain Online Security

As merchants and consumers shift to contactless and EMV-enabled point of sale terminals, risk has shifted towards online transactions. To mitigate this risk, it is important for online businesses to use the Address Verification Service (AVS), which verifies that the billing information matches the one registered with the card issuer. Vendors should also ask for Card Verification Value 2 (CVV2) to verify that the user has the card in hand when placing the order. Another important check is to put a limit on an IP address for the number of cards it can use for online transactions.

Prevent Employee Fraud

Employee fraud is always a major concern for risk management professionals.  Businesses should remember to keep an eye on credit card activity, particularly returns, as employee theft often shows up in fake discounts or returns. Companies should create alerts that set limits on returns at stores and notify management any time those limits are exceeded.

 

Risk Management Magazine and Risk Management Monitor. Copyright 2020 Risk and Insurance Management Society, Inc. All rights reserved.

“Presents” of Mind for the Holidays: Six Q&As on Sensible Workplace Gift Giving

‘Tis the season of generosity, random acts of kindness, and selfless gifts. But not all gifts are well received—or positively perceived. In the employment law context, where compliance and best practice remain the watchwords, presents exchanged by colleagues, however well-intentioned, must still pass muster under law and corporate policy. Below are answers to several questions addressing the appropriateness of workplace gifts given during this time of year.

Q: Are there any employment law concerns about gifts given around the holidays—such as gifts with potentially romantic overtones, such as flowers, perfume, or perhaps an invitation to a one-on-one carriage ride—that may give rise to subsequent claims of sexual harassment? Or are such presents innocuous in the holiday season?

A: The nature of the holiday doesn’t change the nature of the gift exchanged between workers (regardless of managerial or non-managerial level). If an item is one that could lead to questions regarding the sender’s motivation (e.g., a veiled romantic overture), it should be avoided. Failing to do so could create misimpressions as to a sender’s true motive or could lead to the perception of favoritism or inappropriate sexual advances.

Q: Managers sometimes are told not to accept gifts from subordinates. Why might accepting presents from subordinates be imprudent? And how might managers tactfully turn down presents from subordinates?

A: Allowing gifts from subordinates may create the false impression that gift-givers are treated differently than non-gift-givers. It also may allow tacit competition concerning who can give the best, most expensive, or most thoughtful gift, and lead to morale problems or discomfort among employees. A considerate way to turn down a gift from a subordinate is to make it known, graciously but unequivocally, prior to the holidays, that gifts will not be accepted. If such a statement seems Scrooge-like, suggesting that an anonymous donation to a charity would be acceptable (rather than a tangible gift to the supervisor) could be an appropriate alternative.

Q: Are there are any issues with employees giving each other religious presents at this time of year? (It is, after all, a religious time of year for many.) In the workplace, might that be problematic? What limits on presents between coworkers might be warranted?

A: Religious gifts should generally be avoided, both at holidays and at other work times. Such gifts could create the impression that one particular religion is more acceptable than others to the gift-giver, and could lead to discomfort in the workplace on that issue.

Other limits on gift giving in the workplace (besides the “romantic” gifts and the religious gifts mentioned previously) could be related to gag gifts concerning protected characteristics—for instance, “over-the-hill” or other age-related gifts or cards, or items that derogate a physical or mental disability. Such gifts could lead inadvertently to claims of discrimination or inappropriate workplace actions.

Q: What about bosses giving presents or holiday cards to employees? Are there any risks with this?

A: This is simply the inverse of the question regarding managers accepting or refusing gifts, and it raises similar issues. Unless a boss is giving a neutral gift (e.g., a one-pound bag of coffee, local history book, or non-religious seasonal card) to every employee, selective gift giving may occasion claims of preferential treatment, discrimination, and/or workplace harassment.

Q: Are limits on gift giving likely to be perceived as not in the holiday spirit? How can an employer enforce these limits without seeming unfestive?

A: While limits on gift giving could be perceived as “not in the holiday spirit,” the risk avoidance element is more critical to employers. There’s often a fine line between limiting the fun associated with the holidays and creating an atmosphere that could encourage inappropriate behavior. The solution is clear, thoughtful communication. It’s OK to tell employees that there’s a limit on gift giving, and that part of the reason is so that no one feels left out or unable to keep up with the level of gifts exchanged. Setting a reasonable limit—either in value or in substance—could allow employees to understand that the employer is doing this thoughtfully, with the best interests of the employees in mind.

Q: What might be some elements of a company gift policy, both during the holidays and at other times of year?

A: A company-wide gift policy, assuming that the employer is not already limited by regulations or laws, would depend upon the nature of the company or work group, the size of the business, and the holiday being celebrated (i.e., is it a religious holiday or, say, an employee’s birthday?). Policies may also address gifts from outside sources, including contractors, customers, lobbyists, and others. Clear rules supported by language explaining the general rationale for the policy can help employees fully understand the restrictions being imposed.

 

© 2019, Ogletree, Deakins, Nash, Smoak & Stewart, P.C., All Rights Reserved.
The author of this article was previously quoted on this topic on SHRM Online.
For more on company policies around the holidays, see the National Law Review Labor & Employment law page.

Dear Former Employee, Here Are a Few Things I Want You to Know

Do you provide terminated employees with information regarding their employee benefits upon termination? If not, consider doing so now—especially if you typically provide a lot of your benefits information on your intranet site, which employees will lose access to upon termination. Even though there is generally no legal requirement to do so, providing departing employees with a letter that includes important reminders and deadlines related to their benefits is beneficial for two reasons: (1) it will save your HR department time by reducing the number of benefits-related inquiries they receive from former employees, allowing them to focus their time on more valuable tasks, and (2) the letter can help defend against a claim by a former employee who loses benefits because they missed a deadline.

Here is a non-exhaustive list of items we recommend including in your letter to exiting employees regarding their benefits:

Remind them of important dates and deadlines, and provide them with other relevant information regarding their benefits, including:

  • The date their medical and other insurance coverages will stop
  • Whether their accrued vacation will be paid out
  • When they can expect to receive their last paycheck
  • If applicable, the deadline to exercise their outstanding stock options
  • Their right to convert their group life insurance coverage to an individual policy
  • The deadline to use their Flexible Spending Account (FSA) balances

    **Note that California recently passed a law that actually requires employers to notify employees starting January 1, 2020 of any deadline to withdraw funds from their FSAs before the end of the plan year, such as when an employee terminates employment.By drafting this letter now, you can get ahead of this requirement!

  • If applicable, the date that their non-qualified deferred compensation payments will begin

Provide them with a list of important documents they should be watching for in the mail to prevent employees from inadvertently throwing these important documents away, including:

  • 401(k) or pension distribution packets
  • COBRA election packets

Remind them to update you and your plan administrators if their address changes (both residential and email addresses), and provide them contact information for whom to send updated information, since you will need this information to send out their final Form W-2 and your plan administrators will need it to be able to provide plan information and notices.

As mentioned above, this is a non-exhaustive list. Consider gathering your HR and benefits professional staff together for a 15-minute brainstorming session about other topics to include. We’re sure you’ll come up with other helpful items.

© 2019 Foley & Lardner LLP

Employer Concerns with Employee Substance Abuse and Drug Use: A Q&A with Caroline J. Berdzik of Goldberg Segalla

With headlines and staggering statistics extolling the impact of the opioid epidemic ripping through the United States, and marijuana (medical and recreational) legalized and decriminalized and a patchwork of state, federal and municipal laws across the country; employers dealing with employee substance abuse and drug use issues have a lot of things to consider. Caroline J. Berdzik, a partner with Goldberg Segalla and chair of the firm’s Labor and Employment and Health Care Groups,  focuses on counseling employers on human resources and employment matters, and was kind enough to share her thoughts on the thorny issues of employers navigating employee substance abuse and drug use.  Read on for more insight and ideas on  how employers should proceed when an employee demonstrates some indication of substance abuse, what the concerns are for employers, and some thoughts on how to move forward keeping in mind changing attitudes on addiction and the laws that may apply.

Can you outline some of the dangers employers face when employing an individual who is struggling with addiction?

Unfortunately, substance abuse addiction and its ramifications cannot avoid the workplace. There is an acknowledgment that this is not an issue that has social or economic boundaries, anyone from highly compensated executives to hourly employees may struggle with addiction. Addiction can take many forms including alcohol abuse, opioid dependency, or the use of other illegal or legally prescribed substances. Employers need to be concerned about legal issues when dealing with an employee who is struggling with addiction. It may be difficult to confirm that an employee has an addiction as they may try to hide it and depending on the circumstances, there may be limits of how far an employer can pry into these concerns.

Once the problem is confirmed, some consideration needs to be given as to whether the employee can continue to do their job while working through addiction. If they are unable to perform their job responsibilities, there are options or reasonable accommodations available to the employee or employer (i.e., leave of absence for treatment). Other components to consider include the availability of drug and alcohol testing permitted under the law in their specific jurisdiction; whether the employee’s conduct has violated any company policies; and if the behaviors associated with the employee’s addiction is negatively impacting the quality of their work and interactions with co-workers, supervisors, clients, and others outside the workplace.

What are some of the issues employers must consider when discussing an employee’s addiction problems with an employee? What are the concerns, especially since addiction can be difficult to identify? 

Employers need to be very careful in this regard. Generally, potential addiction is brought to an employer’s attention through observation or by reports from other employees, supervisors, clients, or even customers. If alcohol is the issue, it may be difficult to detect when someone is under the influence, particularly if the consumption is during non-working hours and if the employee is merely coming to work hungover―as opposed to being intoxicated on the job. If the suspected addiction involves drugs (e.g., whether legal or illegal), there are states that don’t allow for reasonable suspicion testing and some states that make it virtually impossible to test at all. Additionally―depending on the nature of the drug―it may also not show up in the drug test depending on when the test is done.

Many times, this is a difficult conversation to have with an employee since they will most likely deny having any issue because they don’t want to jeopardize their income or employment prospects. Employers need to be careful not to potentially run afoul of the Americans with Disabilities Act (ADA) and other state anti-discrimination laws when discussing a suspected substance abuse problem. Merely perceiving the employee as having a disability can open the employer up to legal risk. Therefore, it is critical to proceed with caution and consult internally or externally with legal counsel and human resources on how to best handle the situation.

How does the legality of the substance the employee is addicted to impact the employer’s actions?  For example, an employee addicted to legal opioid painkillers vs. an employee who is addicted to cocaine or other illegal substances?

The laws are greatly evolving in this area, particularly with respect to cannabis. More and more states have legalized medical marijuana and recreational marijuana. With respect to alcohol, it’s legal to drink alcohol as long as the individual is of age; however, alcohol abuse can cause just as many problems as an employee struggling with a substance abuse problem.

While it may seem easier to take certain actions when managing employees with addictions to other substances (e.g., opioids and cocaine), there are still considerations that come into play. For example, employers in some states cannot take actions against employees based on what activities that they do during off-duty hours.

Irrespective of the legality of the substance, the employer needs to focus on whether the employee is impaired at work or at work functions (e.g., on a business trip, attending a conference, meeting with clients, etc.). They also need to consider the impact of those behaviors on the individual, the company, and anyone else involved. Employers also need to be cognizant of the laws in their jurisdictions and the policies the company may have regarding the use of alcohol and drugs in the workplace. If someone is a current user of an illegal substance, there is typically no protection afforded to them under the ADA or similar anti-discrimination laws. However, if an employee can tie their addiction to an underlying mental health disorder, it becomes murkier. For employees who are recovering drug addicts or alcoholics, there is likely more protection afforded under anti-discrimination laws.

The key thing for employers to remember is to not make any knee-jerk decisions when evaluating these issues. Employers should take time to fully analyze the circumstances before taking any action and determine what legal obligations, if any, it may have to try to accommodate employees.

What legal requirements come into play when human resources intervene with an employee struggling with addiction?  For example, can this be a situation where the ADA applies?

The ADA is typically something that would come into play when dealing with an employee struggling with addiction. Human resources should consult with legal counsel while navigating through this type of issue. There are a myriad of laws that are intertwined that could potentially be relevant including the federal Family Medical Leave Act, as well as other state or local counterparts. In many circumstances, the employer may need to provide a reasonable accommodation to assist an employee struggling with addiction. Best practices may dictate this type of documented discussion with the impacted employee, even without a legal requirement to do so.

Attitudes toward addiction are changing with addiction increasingly being seen as a disease that should be treated without judgment–how does this shift change an employer’s reaction to employees with addiction issues?

As these issues become more prevalent, including the revelation that they impact individuals at higher level positions at companies, employers are increasingly willing to work with employees to get them the help they need. I have seen an uptick in counseling calls where employers are genuinely concerned about their employees’ well-being and want to find ways to assist them. However, I have seen situations where employers have gone above and beyond to work with a struggling employee and the employee failed to help themselves with the assistance being offered.

Rates of prescription opioid abuse are skyrocketing. How is this worrisome trend affecting employers, and are there any proactive steps employers can take?

Opioid use is a very serious problem impacting the workplace. Employers are well advised to have employee assistance programs (EAPs) in place. They should also have open-door policies to encourage employees to come to human resources to seek help for their addiction.

Many thanks to Caroline J. Berdzik of Goldberg Segalla for sharing her thoughts and insights on this complicated, yet increasingly relevant employment law issue.

Copyright ©2019 National Law Forum, LLC

More employment law issues on the National Law Review Labor & Employment page.

Mexico Mandates Protection From Workplace “Psychosocial Risks”

Globalization, technology developments, and the world’s economy, among other factors, have changed our day-to-day dynamics and have transformed the way we work. This means that employees must deal with emotions and circumstances that in the past were not significant but today are studied and classified by scientists as “psychosocial risks.”

The World Health Organization (WHO) and the International Labour Organization (ILO) define psychosocial risks as the interactions within the work environment, content of the work, conditions of the organization and capacities, needs and culture of the employee, and personal considerations—external from work—based on perceptions and experience that can negatively influence health, performance at work, and labor satisfaction.

International organizations are trying to create a broad awareness of psychosocial risks and thereby prevent such risks from damaging employee health, both physical and psychological.

Mexico’s Regulation of Psychosocial Risks at Work

Mexico has taken a big step in the protection of employees with the amendment to the Federal Labor Law on November 30, 2012. This amendment incorporates into the law the concept of “decent and dignified work,” which encompasses respect for the human dignity of employees and, in consequence, the prevention of harm that employees may suffer because of the activities they perform at work.

The amendment and subsequent obligations agreed upon by the current federal government in its national development plan, as well as internationally, compelled the Mexican Ministry of Labor and Social Welfare to issue the Federal Regulation of Health and Safety at Work. Its goal is to establish health and safety provisions, which must be observed at the workplace, “in order to have the conditions to prevent risks, and as a consequence, guarantee employees their right to perform their activities in an environment that assures their lives and health, according to the Federal Labor Law.”

What to Expect in 2019 and 2020: The Psychosocial Risk Factors Standard

Based on the above and with the purpose of complying with current legislation, the Ministry of Labor and Social Welfare developed the Official Mexican Norm: NOM-035-STPS-2018 “Psychosocial Risk Factors at Work – Identification, Analysis and Prevention.” Its main objective is to “identify, analyze and prevent psychosocial risk factors, as well as to promote a favorable organizational environment at workplaces.”

Though the rule has been valid since October 23, 2018, the Ministry of Labor and Social Welfare will not review employers’ compliance with the rule until the October 2019 or October 2020, depending on the employer’s size. Since this matter requires specialist analysis and evaluation, employers may want to contact a specialist on psychosocial risks in order to achieve compliance.

The following are employers’ main obligations under the rule:

  • Establish, maintain, and disseminate among the employees a psychosocial risks prevention policy

  • Identify psychosocial risk factors and evaluate the organizational environment (applicable to work places with more than 50 employees)

  • Use questionnaires to identify psychosocial risk factors (applicable to work places with 16–50 employees)

  • Disseminate to employees the policy and measures adopted to reduce psychosocial risks

  • Identify the employees subject to psychosocial damages while working or derived from their work

  • Provide a registry where employees can learn about psychosocial risk factors and corrective actions taken

  • Maintain a confidential complaint system so the employees can inform the employer about psychosocial risk factors

  • Take actions to prevent psychosocial risk factors and corrective measures if psychosocial damage occurs

Co-Authored by Natalia Merino, a law clerk in the Mexico City office of Ogletree Deakins.

© 2019, Ogletree, Deakins, Nash, Smoak & Stewart, P.C., All Rights Reserved.
Learn more about International Legal issues on the National Law Review Global page.

Are Uber Drivers Employees?

With the advent of ridesharing services, there is an extremely large number of drivers for those companies out on the roads. But are drivers for Uber and similar companies “employees”? Over the years these companies have taken the position the drivers are not employees but rather independent contractors. The Office for the General Counsel of the National Labor Relations Board (NLRB) recently weighed in on this issue, and he agrees with Uber.

In a recently released advice memo, the board concluded that Uber drivers are independent contractors under the National Labor Relations Act (NLRA). When analyzing the relationship between Uber and its drivers, the memo states that it needed to primarily evaluate: “(1) the extent of the company’s control over the manner and means by which drivers conduct business and (2) the relationship between the company’s compensation and the amount of fares collected.” Looking at those factors, the board held:

“Consideration of all the common-law factors, viewed through the ‘prism of entrepreneurial opportunity,’ establishes that UberX drivers were independent contractors. The drivers had significant entrepreneurial opportunity by virtue of their near complete control of their cars and work schedules, together with freedom to choose log-in locations and to work for competitors of Uber. On any given day, at any free moment, drivers could decide how best to serve their economic objectives: by fulfilling ride requests through the App, working for a competing ride-share service, or pursuing a different venture altogether. As explained in detail below, these and other facts strongly support independent-contractor status and outweigh all countervailing facts supporting employee status.”

The memo arrived at the same conclusion for UberBLACK drivers – another category of driver – based on the same analysis. The NLRB’s newly restored test for evaluating independent status was cited extensively.

Independent contractor status poses significant consequences under the NLRA because such workers are not covered under the act. This means they cannot form unions or seek redress for any alleged violations of the NLRA. However, employers must take care to ensure they do not misclassify workers as independent contractors because that can pose significant legal risk. This new advice memo sets forth a potential roadmap for companies desiring to use an independent contractor model, at least when it comes to the NLRA.

 

© 2019 BARNES & THORNBURG LLP
This post was written by David J. Pryzbylski of Barnes & Thornburg LLP.
Read more about employee classification on the National Law Review’s Labor and Employment page.

Illinois Employers Face A Recent Rash of Class Action Lawsuits Filed Under State Biometric Information Privacy Law

Illinois enacted its Biometric Information Privacy Act (“BIPA”) in 2008 to regulate, among other things, employer collection and use of employee biometric information.  Biometrics is defined as the measurement and analysis of physical and behavioral characteristics.  This analysis produces biometric identifiers that include things like fingerprints, iris or face scans, and voiceprints, all of which can be used in a variety of ways, including for security, timekeeping, and employer wellness programs.

Illinois is not the only state with a biometrics privacy law on its books, however, its version is considered the nation’s most stringent.  BIPA requires a business that collects and uses biometric data to protect the data in the same manner it protects other sensitive or confidential information; to establish data retention and destruction procedures, including temporal limitations of three years; to publish policies outlining its biometric data collection and use procedures; and to obtain prior, informed consent from any individuals from whom it plans to obtain and use biometric data.   The statute also requires  businesses to notify employees in the event of a data breach.

Protection of biometric data is viewed as critical because, unlike passwords comprised of letters, numbers, or typographical characters, biometric data is unique and cannot be replaced or updated in the event of a breach.  Technology now allows biometric data to be captured surreptitiously, such as recording a voice over the phone, or face mapping individuals in a crowd or through photographs, increasing the risk for its theft or unauthorized or at least, unknown, use.  In fact, these more furtive methods of collecting and using biometric data is what led to the filing of five BIPA class action lawsuits in 2015 – four against Facebook, and one against online photo website Shutterfly – that alleged these companies used facial recognition software to analyze online posts, but did not comply with BIPA’s consent or other procedural requirements.  These first lawsuits brought attention to the private right of action authorized under BIPA, which provides that any “aggrieved” person may sue and recover $1,000 for each negligent violation and $5,000 for each intentional or reckless violation, or, in both circumstances, actual damages if greater than the statutory damages.  Prevailing parties may also recover their attorneys’ fees and costs.

The plaintiffs’ employment bar recently has gotten seriously into the BIPA class action game; since August 2017, approximately 30 lawsuits have been filed in Cook County, Illinois (where Chicago is), alone.  These putative class actions have been filed against employers in many industries including gas stations, restaurants, and retail, and typically involve the employer’s use of fingerprint operated time clocks.  The cases allege that the defendant employers failed to obtain proper informed consent or fail to maintain and inform employees about policies on the company’s use, storage, and destruction of biometric data.  Many of these lawsuits also allege the employer companies have improperly shared employee biometric data with third-party time clock vendors, and some even name the vendor as a defendant.

In addition to the obvious cost of class action litigation, these suits present additional legal challenges because many aspects of BIPA remain untested.  For example, the statutory term “aggrieved” person leaves open the question whether a plaintiff must be able to prove actual harm in order to recover.  The U.S. District Court for the Northern District of Illinois and U.S. District Court for the Southern District of New York both have dismissed BIPA suits for lack of standing where the plaintiffs did not allege actual harm.  The latter case, Santana v. Take-Two Interactive Software, is currently before the United States Court of Appeals for the Second Circuit, which heard oral argument in October 2017, but has not yet issued its ruling.   Other aspects of BIPA also remain in flux – such as whether facial recognition through photography is biometric data, as defined under the statute, and what forms of consent are compliant.  On the other side, defendants are challenging the constitutionality of the damages provisions, arguing that their potentially disproportionate nature to any actual harm violates due process.  As these issues are flushed out under BIPA, they are certain to affect other states who have already enacted, or may seek to enact, laws regarding use of biometric data.

This post was written by Daniel B. Pasternak of Squire Patton Boggs (US) LLP., © Copyright 2017
For more Labor & Employment legal analysis go to The National Law Review 

Employees Sue for Fingerprint Use

Employees of Peacock Foods, an Illinois-based food product manufacturer, recently filed a lawsuit against their employer for alleged violations of Illinois’ Biometric Information Privacy Act. Under BIPA, companies that collect biometric information must inter alia have a written retention policy (that they follow). As part of the policy, the law states that they must delete biometric information after they no long need it, or three years after the last transaction with the individual. Companies also need consent to collect the information under the Illinois law, cannot sell information, and if shared must get consent for such sharing.

According to the plaintiff-employees, Peacock Foods used their fingerprints for a time tracking system without explaining in writing how the saved fingerprints would be used, or if they would be shared with third parties. According to the employees, this violated BIPA’s requirement for explaining -in the consent request- how information would be used and how long it would be kept. The employees also alleged that Peacock Foods did not have a retention schedule and program in place for deleting biometric data. The employees are currently seeking class certification.

Putting it Into Practice: This case is a reminder that plaintiffs’ class action lawyers are looking at BIPA and possible complaints that can be brought under the law. To address the Illinois law – and similar ones in Texas and Washington – companies should look at the notice and consent process they have in place.   

This post was written by Liisa M. Thomas & Mukund H. Sharma of Sheppard Mullin Richter & Hampton LLP., Copyright © 2017

For more Labor & Employment legal analysis, go to The National Law Review