Medical Marijuana: When a Positive Drug Test may not be Grounds to Fire an Employee

In a portentous opinion, Massachusetts’ highest court held that a medical marijuana patient terminated for failing a drug screening could state a claim for disability discrimination against her employer.  Because many states’ medical marijuana laws contain the similar language to that which the court relied on, employers outside of Massachusetts should take note.

The facts are relatively unremarkable.  The plaintiff had told her prospective employer that she had been prescribed medical marijuana to treat her affliction with Crohn’s disease, but that she did not use it daily and would not use it before or during work.  On the evening of her first day of work, the company’s HR representative notified the plaintiff she was terminated for failing the pre-employment drug screening because the company “follow[ed] federal law, not state law.”  The plaintiff sued for, among other things, disability discrimination under state law.

In reversing the trial court’s dismissal of the discrimination claims, the Massachusetts Supreme Judicial Court premised its decision on a provision of the state’s medical marijuana law stating that a qualified person “shall not be . . . denied any right or privilege,” for use of medical marijuana.  Essentially, the Court held that because a waiver of the employer’s policy excluding persons who test positive for marijuana could have been a reasonable accommodation, the employer’s refusal to engage in the interactive process constituted a denial of the plaintiff’s rights not to be fired because of a disability and to require a reasonable accommodation under the state’s anti-discrimination law.

The Massachusetts court was not persuaded by the employer’s argument that its drug testing policy, not her disability, was the basis for the termination.  The Court analogized an employer policy prohibiting marijuana to one prohibiting insulin and explained that reliance on a company policy prohibiting any use of marijuana to terminate an employee whose disability is being treated with marijuana effectively denies such employee the opportunity of a reasonable accommodation.

Although no other high court had previously reached a similar conclusion, few cases have been brought under disability discrimination laws in states whose medical marijuana laws prohibit the denial of rights and privileges to patients.  For example, New Mexico’s law contains such a prohibition, but it only applies to practitioners.  New Jersey, on the other hand, clearly extends the prohibition to patients.

It is also significant that the Court also rejected the employer’s argument that the state’s medical marijuana law did not require “any accommodation of any on-site medical use of marijuana in any place of employment.”  Instead, the Court found that this statutory language implicitly recognized the existence of an accommodation for off-site medical marijuana use.  Again, many states’ medical marijuana laws are worded in a similar manner and are susceptible to a reading that would permit an accommodation that does not require an employer to tolerate on-the-job use.

Of course, because this was a motion to dismiss, the Court recognized that the employer could ultimately prevail on summary judgment by showing that a use accommodation would be an undue hardship.  Nonetheless, given that ninety percent of states have passed some form of medical marijuana law – a fact the Court cited in rejecting arguments that the federal scheduling of the drug demonstrates no recognized medical benefit – employers can bet that this case could inspire similar suits in states with similar statutory language.  Keep an eye on this space, and Fox’s Cannabis Law blog for further developments.

Today’s post comes to us courtesy of Justin Schwam, an associate in our Labor and Employment Group in the Morristown office

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Will Paid Family Leave Become the Law of the Land?

Included in President Trump’s 2018 budget proposal is a request for funding a paid leave program.  The program would require $19 billion from the budget and would provide that employees were entitled to 6 weeks of paid leave from work.

So far, Republicans have not warmed to the idea.

Yesterday, at least 100 Democrats wrote a letter to President Trump also expressing concerns over the proposal.  However, the Democrats are concerned that the proposal does not go far enough. Democrats are pushing for consideration of other Democrat-sponsored bills that would provide for 12 weeks’ paid leave, matching the FMLA leave entitlement.

At this stage, it really is too early to tell whether some form of paid family leave will wind up in the final budget or if it will become a casualty of the horse-trading that goes on when trying to reach a consensus on the budget.

We will be keeping an eye on this one.

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Arizona Sick Leave Law Goes in Effect July 1st: Are you ready?

In November, voters in Arizona approved a ballot initiative that would require employers to provide paid sick leave.  The law goes into effect tomorrow.

Under the law, Arizona employers with less than 15 employees will have to provide up to 24 hours of paid sick leave.  Employers with 15 or more employees will have to provide up to 40 hours of paid sick leave.

In anticipation of the law, the Arizona Industrial Commission has issued FAQs, which can be found here.  The FAQs do make one significant change from the text of the law.  The FAQs do make clear that when counting employees for purposes of determining how much leave is to be offered, employers need only count employees working in Arizona.  Don’t get too excited.  This could change as the Commission itself notes that there might be further legislative guidance on this issue.

Employers not only need to make sure that they are offering leave, they will need to provide notices to the employees and post posters in both Spanish and English.

Arizona’s law, like many others, contains a no retaliation provision.  However, this provision should give employers pause.  Under the law, if any adverse action is taken against an employee within 90 days of them using sick leave, there is a presumption that adverse action was retaliatory.  Employers will then bear the burden of proving by clear and convincing evidence that the action was for a legitimate purpose.

Employers should tread carefully before disciplining any employee who has recently used sick leave.

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USDOL Announces the Reinstatement of Issuance of Opinion Letters

The U.S. Department of Labor announced today that it will reinstate the issuance of opinion letters, a practice that was widespread under some prior administrations, but which it elected to forego during the Obama administration.  In an email announcement sent out today, the USDOL announced:

The U.S. Department of Labor will reinstate the issuance of opinion letters, U.S. Secretary of Labor Alexander Acosta announced today. The action allows the department’s Wage and Hour Division to use opinion letters as one of its methods for providing guidance to covered employers and employees.

An opinion letter is an official, written opinion by the Wage and Hour Division of how a particular law applies in specific circumstances presented by an employer, employee or other entity requesting the opinion. The letters were a division practice for more than 70 years until being stopped and replaced by general guidance in 2010.

“Reinstating opinion letters will benefit employees and employers as they provide a means by which both can develop a clearer understanding of the Fair Labor Standards Act and other statutes,” said Secretary Acosta. “The U.S. Department of Labor is committed to helping employers and employees clearly understand their labor responsibilities so employers can concentrate on doing what they do best: growing their businesses and creating jobs.”

The division has established a webpage where the public can see if existing agency guidance already addresses their questions or submit a request for an opinion letter. The webpage explains what to include in the request, where to submit the request, and where to review existing guidance. The division will exercise discretion in determining which requests for opinion letters will be responded to, and the appropriate form of guidance to be issued.

  

In the past, Republican administrations have often used the issuance of opinion letters to skirt the normal approval process for administrative regulation, which requires public comment.  It remains to be seen, but this will likely be a boon for employers and another setback for employees under the Trump administration.

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9th Cir.: Employer’s Attorney Can Be Sued for Retaliation as a “Person Acting Directly or Indirectly” in Employer’s Interest

Arias v. Raimondo

This case presented an issue of first impression: Can an employer’s attorney be held liable for retaliating against his client’s employee because the employee sued his client for violations of workplace laws? The district court held that he could not and dismissed the claim. On appeal the Ninth Circuit disagreed and reversed.  Specifically, the Ninth Circuit held that as a “person acting directly or indirectly” in the employer’s interest, the employer’s attorney could be subject to liability under 29 U.S.C. § 215.

In the case, the defendant-employers had hired the plaintiff-employee, an undocumented immigrant without verifying his immigration status or his right to work in the United States.  Although not explicitly stated, the Ninth Circuit’s opinion strongly implies that the defendants intentionally neglected to complete an I-9 form or verify plaintiff’s status because it knew he was not legally permitted to work in the United States.

After working for defendants for 11 years, in 2006, plaintiff filed suit in California state court against defendants, alleging that defendants violated a multitude of employment laws, and alleged among other things that defendants failed to provide him with legally mandated rest breaks and failed to pay him legally mandated overtime premiums.

The Ninth Circuit recited the following facts regarding the alleged retaliation, all taken from plaintiffs subsequent lawsuit alleging illegal retaliation that was the subject of the Ninth Circuit’s opinion:

On June 1, 2011, ten weeks before the state court trial, the Angelos’ attorney, Anthony Raimondo, set in motion an underhanded plan to derail Arias’s lawsuit. Raimondo’s plan involved enlisting the services of U.S. Immigration and Customs Enforcement (“ICE”) to take Arias into custody at a scheduled deposition and then to remove him from the United States. A second part of Raimondo’s plan was to block Arias’s California Rural Legal Assistance attorney from representing him. This double barrel plan was captured in email messages back and forth between Raimondo, Joe Angelo, and ICE’s forensic auditor Kulwinder Brar.

On May 8, 2013, Arias filed this lawsuit against Angelo Dairy, the Angelos, and Raimondo in the Eastern District of California. Arias alleged that the defendants violated section 215(a)(3) of the Fair Labor Standards Act (“FLSA”), 29 U.S.C. § 201 et seq.

Arias’s theory of his case is that Raimondo, acting as the Angelos’ agent, retaliated against him in violation of section 215(a)(3) for filing his original case against Raimondo’s clients in state court . Raimondo’s sole legal defense is that because he was never Arias’s actual employer, he cannot be held liable under the FLSA for retaliation against someone who was never his employee.

As noted by the court, Angelo Dairy and its owners settled their part of this case at the early stages of its existence.

The district court dismissed plaintiff’s claims against the defendants’ attorney holding that he was not covered under the FLSA’s retaliation provisions because he was not plaintiff’s employer.  Noting that the FLSA’s retaliation provision defines those subject to liability in a much broader way than the underlying definition of employer (which is broad to begin with) the Ninth Circuit reversed.

Discussing the issue before it the court explained:

Notwithstanding section 215(a)(3)’s reference to “any person,” section 203(a)’ s inclusion of a legal representative as a “person,” and section 203(d)’s plain language defining “employer,” the district court granted Raimondo’s motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). The court did so without the benefit of oral argument, concluding that because Arias “ha[d] not alleged that [Raimondo] exercised any control over [his] employment relationship,” Raimondo as a matter of law could not be Arias’s employer.

The Ninth Circuit rejected this reasoning noting that the statutory definition of those who may be subject to liability under the FLSA’s retaliation provision include a broader spectrum of people:

Section 215(a)(3), an anti-retaliation provision, makes it unlawful “for any person … to discharge or in any other manner discriminate against any employee because such employee has filed any complaint … under or related to this chapter.” The FLSA defines the term “person” to include a “legal representative.” Id. § 203(a). Section 216(b) in turn creates a private right of action against any “employer” who violates section 215(a)(3); and the FLSA defines “employer” to include “any person acting directly or indirectly in the interest of an employer in relation to an employee.” Id. §§ 203(d), 216(b).

Controversies under FLSA sections 206 and 207 that require a determination of primary workplace liability for wage and hour responsibilities and violations, on one hand, and controversies arising from retaliation against employees for asserting their legal rights, on the other, are as different as chalk is from cheese. Each category has a different purpose. It stands to reason that the former relies in application on tests involving economic control and economic realities to determine who is an employer, because by definition it is the actual employer who controls substantive wage and hours issues.

Retaliation is a different animal altogether. Its purpose is to enable workers to avail themselves of their statutory rights in court by invoking the legal process designed by Congress to protect them. Robinson v. Shell Oil Co., 519 U.S. 337, 346 (1997) (the “primary purpose of antiretaliation provisions” is to “[m]aintai[n] unfettered access to statutory remedial mechanisms”).

This distctive purpose is not served by importing an “economic control” or an “economic realities” test as a line of demarcation into the issue of who may be held liable for retaliation. To the contrary, the FLSA itself recognizes this sensible distinction in section 215(a)(3) by prohibiting “any person” –not just an actual employer – from engaging in retaliatory conduct. By contrast, the FLSA’s primary wage and hour obligations are unambiguously imposed only on an employee’s de facto “employer,” as that term is defined in the statute. Treating “any person” who was not a worker’s actual employer as primarily responsible for wage and hour violations would be nonsensical…

Congress made it illegal for any person, not just an “employer” as defined under the statute, to retaliate against any employee for reporting conduct “under” or “related to” violations of the federal minimum wage or maximum hour laws, whether or not the employer’s conduct does in fact violate those laws. … Moreover, “the remedial nature of the statute further warrants an expansive interpretation of its provisions. …”  Id. at 857 (second omission in original) (quoting Herman v. RSR Sec. Servs., 172 F.3d 132, 139 (2d Cir. 1999)).

 

In line with this reasoning, the court concluded:

The FLSA is “remedial and humanitarian in purpose. We are not here dealing with mere chattels or articles of trade but with the rights of those who toil, of those who sacrifice a full measure of their freedom and talents to the use and profit of others …. Such a statute must not be interpreted or applied in a narrow, grudging manner.” Tenn. Coal, Iron & R.R. Co. v. Muscoda Local No. 123, 321 U.S. 590, 597 (1944).

Accordingly, we conclude that Arias may proceed with this retaliation action against Raimondo under FLSA sections 215(a)(3) and 216(b). Raimondo’s behavior as alleged in Arias’s complaint manifestly falls within the purview, the purpose, and the plain language of FLSA sections 203(a)203(d), and 215(a)(3).

Our interpretation of these provisions is limited to retaliation claims. It does not make non-actual employers like Raimondo liable in the first instance for any of the substantive wage and hour economic provisions listed in the FLSA. As illustrated by the Court’s opinion in Burlington, the substantive provisions of statutes like Title VII and the FLSA, and their respective anti-retaliation provisions, stand on distinctive grounds and shall be treated differently in interpretation and application. Ultimately a retaliator like Raimondo may become secondarily liable pursuant to section 216(b) for economic reparations, but only as a measure of penalties for his transgressions.

Click Arias v. Raimondo to read the entire opinion.

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Document. Document. Document: A Must in the Employment Context

I am sure that a lot employers lost productive work time yesterday with the Comey hearing. I must admit that I did not watch the Comey testimony yesterday.  I actually had a busy day and was afraid of getting sucked down the rabbit hole.  I do intend to catch up on it.  If you are so inclined, the New York Times has the full video and a transcript of the testimony.

I did read the seven page statement Comey released in anticipation of his testimony.   That seven page document detailed the meetings Comey had with President Trump and most shockingly, the statement that he felt compelled to start notes of the meeting on a laptop in his car immediately after leaving the White House.

Although the notes themselves are not conclusive proof, they could go along way in proving his claims.  Some may say that Comey was being needlessly paranoid, however, he did exactly what I wish all managers would do.  He saw an issue and he documented that issue.

Too often, whether I am simply being asked to give advice or I am trying to defend a lawsuit, I hear from managers that the employee was a terrible employee who had been spoken to on multiple occasions.  However, there is no documentation that corroborates that.

I do understand that some discipline and counseling will be verbal, but managers should still take notes of such meetings.  If for no other reason than when you are sitting down to do more formal discipline, you will be aware of what was discussed and on how many previous occasions.

The second thing that Comey did that managers should do is share the documentation.  He wrote that he showed his notes to senior FBI officials as soon as he wrote them. This makes it harder to argue that the notes were not contemporaneously made.

Once counseling or discipline is documented, the manager should forward that documentation to HR to be placed in the employee’s file.  This will go a long way to defending the company and employer in any later litigation.

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Third Party Contractor Liability under the New York State Human Rights Laws

Catherine Savio writes:

Courthouse pillarsCopyright: bbourdages / 123RF Stock Photo

On May 31, 2017, the Second Circuit seemingly broadened the scope of liability under a New York state anti-discrimination law by holding that non-employer third parties can be held liable for violating rules regarding the use of a job applicant’s criminal history records in hiring processes.

The plaintiffs in Griffin v. Sirva Inc., No. 15-307 (2d. Cir. 2017), were employed by Astro Moving and Storage Company, a New York-based moving company. Astro is a contractor for the nationwide moving company Allied Vans Incorporated.  Allied prohibited the companies with which it contracted from employing individuals if they had ever been convicted of a sexual offense.

In 2011, Astro terminated the plaintiffs’ employment following a background check that revealed plaintiffs’ prior convictions for sexual offenses. In Griffin, the plaintiffs brought claims against Allied, a third-party contractor by whom they were not directly employed, under the New York State Human Rights Laws (“NYSHRL”) for violations of NYSHRL’s limitations on the use of criminal background checks in hiring decisions.

The United State District Court for the Eastern District of New York dismissed the claims brought against Allied, holding that the NYSHRL criminal conviction ban only applies to employers. On appeal, the Second Circuit overturned the lower-court’s decision,  holding that NYSHRL covers entities other than those who directly employ the workers, including third-party contractors. The court cited a four-part test from a 1985 fourth department decision, State Div. of Human Rights v. GTE Corp., 109 A.D.2d 1082 (4th Dep’t 1985), noting that the power to control a worker’s performance is the most important factor in determining whether or not an entity is acting as a workers “employer” for NYSHRL purposes. The Court remanded the case to the United States District Court for the Eastern District of New York to determine whether or not Allied qualified as an employer for NYSHRL liability purposes.

Catherine Savio is an associate in the firm’s Litigation Department, resident in its New York office.

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