Wednesday, November 25, 2015

Third Circuit on Compensation for Lunch Breaks

Yesterday, the Third Circuit issued its opinion in Babcock v. Butler County (opinion here). The plaintiffs brought this collective action under the Fair Labor Standards Act (FLSA) for compensation during their lunch breaks.

The employees are corrections officers, who receive one-hour lunch breaks. Under their collective bargaining agreement, they get paid for 45 minutes and they do not get paid for the remaining 15 minutes.
Not official use.
During the meal period, the corrections officers may not leave the prison without permission from the warden or deputy warden, and they must remain in uniform, in close proximity to emergency response equipment, and on call to respond to emergencies. Plaintiffs claim that as a result of this meal period policy, the officers cannot run personal errands, sleep, breathe fresh air, or smoke cigarettes during mealtime, and if an emergency or unexpected situation arises, the officers must respond immediately in person, in uniform, and with appropriate response equipment.
Does the FLSA require the employer to pay them for those 15 minutes?

The Third Circuit noted a split between courts regarding which of two tests to use:
one looks to whether the employee has been relieved from all duties during the mealtime; the other, more generally adopted, looks to the party to which the “predominant benefit” of the mealtime belongs . . . . The predominant benefit tests asks “whether the officer is primarily engaged in work-related duties during meal periods.”
The Third Circuit used the "predominant benefit" test.

The Third Circuit concluded that the burdens imposed on the employees do not outweigh the benefit to the employees of the lunch break. In other words, the employees receive the "predominant benefit." The Court also considered the CBA as a factor in the analysis, noting that it represents "the agreed-upon characterization of the fifteen-minute unpaid meal break."

This case is a fairly significant win for employers. I expect a lot of FLSA cases will be litigated over who receives the "predominant benefit" of breaks.

Friday, November 20, 2015

November Employment Law Blog Carnival is LIVE! #ELBC

HR Examiner logo used in commentary.
Not licensed use.
The latest edition of the Employment Law Blog Carnival (#ELBC) is now available. So head on over to HR Examiner and check out Employment Law Blog Carnival – Malaprops by John Sumser. He assembled some nice content from across the employment law blogosphere. Nice work, John!

Thursday, November 19, 2015

PA Supreme Court: Noncompetes not enforceable based on magic words

I've been tracking this issue and this case for a while now. The gist of it is simple. A Pennsylvania statute, the Uniform Written Obligations Act (UWOA), generally provides that a written contract will not be rendered unenforceable for lack of consideration if it expressly indicates that each party "intends to be legally bound." Do these so-called "magic words" work for non-competes?

The Superior Court said 'no.' Yesterday, the Supreme Court agreed (opinion in Socko v. Mid-Atlantic Systems of CPA, Inc. here):
In light of our Commonwealth’s long history of disfavoring restrictive covenants, and the mandate that covenants not to compete entered into after the commencement of employment must be accompanied by new and valuable consideration — a benefit or change in employment status — we conclude an employee is not precluded from challenging such an agreement executed pursuant to the UWOA. Thus, we affirm the order of the Superior Court.
There goes that theory. Now, employers will have to create binding noncompetes the old-fashioned way . . . by making sense of a bunch of convoluted common law rules that inevitably fail to draw anything even remotely resembling bright line distinctions. Good luck!

Friday, November 13, 2015

Why ya gotta be so mean?

A little fun on a Friday morning - the District Court opinion dismissing a silly lawsuit against Taylor Swift:
Geez Judge, why ya gotta be so mean?

Thursday, November 12, 2015

The employer "had the good sense to relegate this argument to a footnote."

Today, in my employment law class, we cover the case of Adeyeye v. Heartland Sweeteners. The employee sought a religious accommodation of unpaid leave to return to Nigeria for his father's funeral. While there, he would lead his father's burial rites, stay with his mother during her mandatory one-month seclusion, and sacrifice goats so "death will not come or take away any of the children's life."

As lawyers, we often have to make tough choices about which arguments to make on appeal. On the one hand, if you don't make an argument, you waive it. So, there exists some incentive to throw every argument possible in there. However, on the other hand, sometimes we need to recognize when an argument is a loser and keep it out so as not to draw attention away from the possible winners.

In Adeyeye, there were quite a few losers that the employer could probably have done without. First, the employer argued that it did not have notice that the employee needed a religious accommodation. Really? The request for leave mentioned burial "rites" and sacrificing goats to ward off death... that seems pretty clearly religious to me (in fairness, part of the employer's argument was that the employee was merely respecting his father's wishes and obeying his father's religious beliefs, not his own).

After Adeyeye attended the funeral, he was fired for his absence. The employer then argued that there was no evidence that "the religious observance . . . was the basis for [his] discharge." The Court rightly derided this as "sophistry." Employers have an obligation to reasonably accommodate religious beliefs that conflict with the employer's policy - obviously, the absence was caused by the employer refusing to grant leave to attend a religious ceremony.

The argument that drew the comment in the headline was perhaps the worst of all. The employer argued that it did afford the employee a reasonable accommodation. Brace yourself, because this is a doozy . . . "Finally, we consider Heartland's argument that it did provide Adeyeye with a reasonable accommodation in the form of voluntary self-termination with the possibility of being rehired." Ummmm, no.

The employer did raise one pretty decent argument, which it ultimately lost on, but it was far better than the other arguments outlined above. Allowing an employee to take leave for several weeks may impose an undue hardship. The Court ruled that the employer was not entitled to summary judgment on that issue, but it sounds a lot more plausible than the other arguments.

I don't mean to Monday-morning quarterback the case - and I'm only going off of the Court's opinion; I'm sure there was a lot going on behind the scenes that I'm not privy to. I'm just pointing out that sometimes, it's better to waive an argument than to clutter your brief with it.

Wednesday, November 11, 2015

Are No Re-Hire and No Re-Apply Clauses Unlawful?

conference logoI attended the ABA Labor and Employment Law Conference this past weekend. It was my first time, but it will not be my last. It was a great conference! I learned a lot, but one particular issue stuck out for me: Are "no re-hire" and "no re-apply" clauses unlawful?

When employers and employees part ways, they often enter into separation agreements. The agreement almost always includes a waiver and release of all claims (including discrimination). Often, the agreement also includes a clause stating that the employee cannot re-apply for employment with that employer (or understands that (s)he will not be re-hired). These clauses are pretty common, so I was surprised when an EEOC attorney at the conference stated that the agency takes the position that  such clauses are unlawful (vaguely referencing retaliation).

Really!? I went off in search of more information. I couldn't find much, but I did find this white paper by Wendi Lazar of Outten and Golden: Settling the Case and Wrapping Up Employment: Negotiating Strategies, Drafting Realities:
See Tom Gilroy, EEOC Opposes Settlement Clauses That Bar Re‐Application and Rehiring, BNA DAILY LABOR REPORT, Apr. 4, 2008, at C1 (stating that “the agency opposes as a matter of policy both ‘no‐hire’ and ’no‐re‐apply’ covenants” as such clauses “are not good public policy, since they could be viewed almost as retaliation for coming forward for a discrimination claim”).  At an ABA Labor and Employment Law Section meeting on April 3, 2008, an EEOC attorney stated that the Commission will oppose so‐called “no rehire” or “re‐application” clauses in settlement or employment agreements.  See  However, case law on the issue seems to suggest just the opposite.  To date, courts and the EEOC have upheld settlement agreements or any other agreements containing no re‐employment provisions.  See Jencks v. Modern Woodmen of America, 479 F.3d 1261, 1265‐66 (10th Cir. 2007) (affirming district court’s holding that employee waived entitlement to re‐employment or reinstatement with the employer in an enforceable settlement agreement and that such agreement was a "legitimate non‐discriminatory reason for declining employee's application"); Austin v. Spirit Airlines, Inc., No. 08 Civ. 60540, 2008 WL 4927003, at * (S.D. Fla. Nov. 17, 2008) (on motion to enforce a settlement agreement, compelling plaintiff to execute a full settlement agreement, including a no‐rehire provision); Salerno v. City Univ. of N.Y., No. 99 Civ. 11151, 2005 WL 578944, at *3 (S.D.N.Y. Mar. 10, 2005) (imposing a settlement judgment that included a no‐reemployment provision and noting that “a bar on future employment is not unusual”)); Franklin v. Burlington N. & Santa Fe Ry. Corp., No. 03 Civ. 228, 2005 WL 517913 (N.D. Tex. Mar. 3, 2005), aff'd, 174 Fed. Appx. 831 (5th Cir. Apr. 5, 2006) (holding that employee failed to show that employer’s refusal to process plaintiff’s application on the basis of the separation agreement, which the company believed to include a no‐rehire provision, was pretextual); Khou v. Methodist Hosps. of Dallas, 2004 U.S. Dist. LEXIS 4148, (N.D. Tex. 2004), aff'd, 2005 U.S. App. LEXIS 4206 (5th Cir. 2005) (court affirmed judgment against an employee who applied for a job after entering into a separation agreement where employee promised to voluntarily and permanently resign); Homeport Ins. Servs., Inc. v. Lundy, B236276, 2012 WL 5385640, at *5 (Cal. Ct. App. Nov. 5, 2012) (finding no reemployment provision to be enforceable) (unpublished/noncitable); O'Brien v. Potter, 2004 EEOPUB LEXIS 448 (Feb. 3, 2004) (holding that the settlement agreement between the parties, which included a no‐rehire provision, was enforceable); Jablonski v. Battista, EEOC DOC 01A23730 (Sept. 17, 2003) (enforcing no re‐employment clause in agreement).
Sorry for the long bloc quote with string citation, but it really does a great job of addressing the issue (sadly, the blog link seems to be dead).

The EEOC attorney's position was not well-received at the conference, and she acknowledged that zero case law supports the position. One audience member "politely" suggested that if they couldn't find a single court to side with them in 50+ years, perhaps it was time to move on. The EEOC attorney responded that the agency often seeks to move the law and alter the status quo.

I certainly understand the agency's role in changing the law. However, this places employers in the unenviable position of choosing between what the law apparently allows, and drawing fire from the EEOC as a test case.

Thursday, November 5, 2015

ABA L&E Conference Materials

Here are my materials from my ABA Labor and Employment Law Conference presentation on November 6, 2015 (Building Your Practice 140 Characters at a Time):