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Friday, July 31, 2015

These Written Warnings Were Totally Worthless

By: Thomas Eden


Maurice Goudeau began his career in 1993 as a mechanic and millwright. He was later promoted through the ranks and obtained the position of maintenance supervisor. When his Company was acquired by National Oilwell Varco (NOV) in 2008 Goudeau continued to be employed as a maintenance supervisor at  NOV’s  Conroe,  Texas  facility  until  he  was terminated in 2011 at the age of fifty-seven.

Goudeau’s new boss with NOV (according to Court the findings) allegedly repeatedly made negative comments about old people. He said Goudeau wore “old man clothes,” called him an “old fart,” and said a smoking area was “where the old people meet.” The supervisor also made a comment that “there sure are a lot of old farts around here” during a conversation in which he asked Goudeau about the ages of two other employees. After hearing their ages, he said he was going to fire them. The boss followed through on that statement and ultimately fired two of the three “old farts,” including Mr. Goudeau. He couldn’t fire the third only because he left the company for another reason.

NOV claimed that it fired Goudeau because of his poor performance after written warning. Those complaints about Goudeau only started with this new boss after 18 years of a solid work record. Goudeau’s signature did not appear in the employee acknowledgement section of any of the last three warning forms.

The final three warnings involved duties that Goudeau claimed were not his responsibility. And those written warnings sure were suspicious because all three warnings were signed by his supervisor on the same date even though the infractions supposedly happened on different days, according to the Court filings. None of the warnings were signed by Goudeau. 

The case later landed before the U.S. Fifth Circuit Court of Appeals which held that any ageist remark be proximate in time to the terminations, made by an individual with authority over the employment decision, and related to the challenged decision, and then those comments may only serve as sufficient evidence to allow a jury to find discriminatory motive if they are not stray, but instead are tied to the adverse employment action at issue both in terms of when and by whom they were made. Here they found the alleged “old fart” comments justified sending this age discrimination case to the jury.

Common Sense Counsel: This case teaches employers four lessons according to my law partner Robin Shea who did a firm blog a few days ago on this case: 1) Don’t call your employee an “old fart,” especially if you think you may need to fire him someday; 2) don’t call his co-workers “old farts” right before you fire the co-workers; 3) don’t give your “old fart,” who has only a first-level warning on his record, three “progressive” warnings on the day that you fire him-that the employee has never been presented; and 4) don’t try to invoke “employment at will” to justify any of the above. Because the written warnings were unsigned, the court found them to be worthless evidence.  

Tommy Eden is a partner working out of the Constangy, Smith & Prophete, LLP offices in Opelika, AL and West Point, GA and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com with downloadable written warning form.


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Friday, July 24, 2015

Ticketing Trespassing Union Protesters Lawful

 By: Thomas Eden




In February 1999, an ongoing battle between the Venetian, a Las Vegas luxury hotel and casino complex, and two labor unions came to a head. The Nevada Department of Transportation had issued the unions a permit to hold a demonstration against the Venetian on the temporary walkway in front of the hotel and on one lane of the Las Vegas Strip.
On the day of the demonstration, the Venetian took several additional measures to protect its property rights. The Venetian marked its property boundaries with orange paint and posted signs indicating that the temporary walkway was private property. As over 1,000 demonstrators marched on the walkway, the Venetian played a recorded message over a public address system. The message stated that the demonstrators were subject to arrest for trespass. The Venetian’s security guards placed the demonstration’s leader under citizen’s arrest. The Venetian then asked police officers at the demonstration to issue criminal citations to the demonstrators and to block them from the temporary walkway.

The unions, in turn, filed unfair labor practice complaints against the Venetian with the National Labor Relations Board. An administrative law judge found that the demonstration was protected activity under Section 7 of the National Labor Relations Act and ruled against the Venetian; who appealed the case to the District of Columbia Court of Appeals.

In ruling for the Venetian, the Court held that “the First Amendment’s Petition Clause in the U.S. Constitution protects the right of the people . . . to petition the Government for a redress of grievances… and when a person petitions the government in good faith, the First Amendment prohibits any sanction on that action.” This principle arises out of a U.S. Supreme Court doctrine called the Noerr-Pennington doctrine. Under the Noerr-Pennington doctrine as it applies in the labor law context, employer conduct that would otherwise be illegal may be “protected by the First Amendment when it is part of a direct petition to government.”

Applying those principles, the Court concluded that the Venetian’s act of summoning the police to enforce state trespass law is a direct petition to government subject to protection under the Noerr-Pennington doctrine.Requesting police enforcement of state trespass law is an attempt to persuade the local government to take particular action with respect to a law. As we see it, that fits squarely within the traditional mold of a petition to government protected by the Noerr-Pennington doctrine,” ruled the Court.

Common Sense Counsel: This ruling gives employers an excellent road map to protect their rights and their property. Self help against trespassers is a bad decision during a heated union campaign that will get you an NLRB charge. It is critical to successfully win this battle that you now place “no trespassing” signs at all the entrances to your property so you can enforce your rights later.

Tommy Eden is a partner working out of the Constangy, Smith & Prophete, LLP offices in Opelika, AL and West Point, GA and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com and follow on twitter tommyeden3



Wednesday, July 15, 2015

DOL Claims Many Workers Misclassified

 By: Tommy Eden



On Wednesday the U.S. Department of Labor (DOL) issued guidance aimed at employers who misclassify employees as independent contractors. The DOL claims that most such workers qualify as employees under the Fair Labor Standards Act (FLSA), and not independent contractors, under their expansive definition of employment.

The DOL 15-page “administrator's interpretation” points out that under the FLSA, the key question is whether a worker is genuinely in business for him or herself, which makes that worker an independent contractor, or is economically dependent on the employer, going on to discuss six “economic realities factors” that guide the classification assessment. It is the DOL’s position that the Economic Realities Factors Should Be Applied in View of the FLSA’s Broad Scope of Employment and “Suffer or Permit” Standard.

The “DOL Economic Realities Factors Guide the Determination Whether the Worker Is Truly an Independent Business or Is Economically Dependent on the Employer” are as follows:
1) Is the Work an Integral Part of the Employer’s Business?
2) Does the Worker’s Managerial Skill Affect the Worker’s Opportunity for Profit or Loss?
3) How Does the Worker’s Relative Investment Compare to the Employer ’s Investment?
4) Does the Work Performed Require Special Skill and Initiative?
5) Is the Relationship between the Worker and the Employer Permanent or Indefinite?
6) What is the Nature and Degree of the Employer ’s Control?

These new administrator's interpretation comes two weeks after the DOL proposed a rule that would broaden federal overtime pay regulations to more than double the minimum salary threshold required to qualify for a “white collar" exemption under the FLSA.

The DOL claims that the above six factors should not be analyzed mechanically or in a vacuum, and no single factor, including control, should be over-emphasized.  Rather each factor should be considered in light of the ultimate determination of whether the worker is really in business for him or herself (and thus is an independent contractor) or is economically dependent on the employer (and thus is its employee).  The above factors claims the DOL should be used as guides to answer that ultimate question of economic dependence.  The correct classification of workers as employees or independent contractors has critical legal implications, notes the DOL in their guidance.

Common Sense Counsel: Next time you are trying to decide how to properly classify someone, as an employee or an independent contractor, understand that the right to control the means and manner of performance is a key factor-with about 20 other factors to boot.  So ask yourself the following questions before you hire that person as a 1099 contractor and not an employee. This is truly where an ounce of prevention is preferred to a stiff DOL/IRS fine.


Tommy Eden is a partner working out of the Constangy, Smith & Prophete, LLP offices in Opelika, AL and West Point, GA and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com with Links to “administrator's interpretation” on Blog.  

Wednesday, July 1, 2015

Obama Administration Doubles Salary Test – Top 7 Solutions

By: Tommy Eden



The U.S. Department of Labor announced on Tuesday a proposed rule that would raise the minimum salary threshold required to qualify for the Fair Labor Standards Act's “white collar” exemption to $50,440 per year, $970 a week. There is a 60 day comment period for the proposed regulations. There is a 100% chance it will become law in early 2016.

In order to be exempt from minimum wage and overtime requirements under the FLSA exemption for executive, administrative, professional, outside sales and computer employees, under current FLSA regulations, employees have to meet certain job duties-related tests and currently only be paid at least $455 per week—or $23,660 annually.

The proposed regulation calls for rising to equal the 40th percentile of weekly earnings for full-time, salaried workers.  That would bring it to a projected level of $970 per week, or $50,440 annually, by the first quarter of 2016.

While the increase to the minimum weekly salary was anticipated, what was a surprise was the Administration’s proposal to automatically increase the minimum weekly salary requirement each year based on data from the Bureau of Labor Statistics.

While the Department of Labor said it was considering whether to make changes to the duty tests, the proposed regulations do not include changes.

Common Sense Counsel: This Proposed Regulation will be sticker shock for most manufacturing, retail, fast food and millions of small business employers. Follow these 7 steps for some relief and solutions: 1) take a deep breath and let it out slowly as a stress relief exercise; 2) take the Draft Exemption Trial Work Sheet Test and your current job description (better have one) for each of your current salaried exempt employees and see if they truly pass one of the five exempt employee test; 3) for those previous supervisors who are now newly christened hourly employees who do not pass the test, make them a team leader of some kind with an hourly wage rate; 4) for those hourly employees who will work 50 hours a week consider a Fluctuating Work Week or Belo written agreement to lower your overhead cost; 5) for those who do meet the exempt test, and you still want to keep them salaried, then you will have to give them a raise to 50,440 by the first quarter of 2016 and redraft their job description (in-fact you should redraft most of your job descriptions by the end of 2015); 6)  update your pay reporting system and handbook to help you keep day-by-day control of excessive overtime costs; and most important 7) come up with creative ways to engage and incentivize your hourly employees to think like owners.

Tommy Eden is a partner working out of the Constangy, Smith & Prophete, LLP offices in Opelika, AL and West Point, GA and a member of the ABA Section of Labor and Employment Law and serves on the Board of Directors for the East Alabama SHRM Chapter. He can be contacted at teden@constangy.com or 334-246-2901. Blog at www.alabamaatwork.com with Links to worksheet and regulations on Blog.