Jottings By An Employer's Lawyer

Thursday, July 17, 2014

12 Years Ago

I posted the initial post on this blog. A dozen years is a long time to keep anything going, although you could seriously question whether or not this last year it was really going as the posts were few and far between.

As I have spoken in the past, when I began I was the first labor and employment law blog, although there were some others that joined soon after. Now there are literally hundreds, so the immediate almost news type reporting is amply covered.

So I have contemplated giving this a decent burial.

However, as I near the end of my active practice, I thought maybe this would be a good space to reflect back on some of the things that have happened.

If that proves workable and meaningful, then maybe Jottings will stay alive for some time. If not, well we can cross that bridge when we get there.

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Tuesday, March 25, 2014

How Disruptive Can an Aggressive NLRB Be in a Non-Union Setting? More Than You Might Think

If you are a non-union employer (and overwhelmingly most employers are) you might not have given much thought to your how your confidentiality policy stacked up against the National Labor Relations Act. In fact your policy might read something like the following:

Confidential Information
Employees deal with and have access to information that must stay within the Organization. Confidential Information includes, but is not limited to, information that is related to: our customers, suppliers, distributors; [Company] organization management and marketing processes, plans and ideas, processes and plans, our financial information, including costs, prices; current and future business plans, our computer and software systems and processes; personnel information and documents, and our logos, and art work. No employee is permitted to share this Confidential Information outside the organization, or to remove or make copies of any [Company] records, reports or documents in any form, without prior management approval.Disclosure of Confidential Information could lead to termination, as well as other possible legal action.
But if it does, then according to the NLRB, now buttressed by the 5th Circuit Court of Appeals, you are in violation of the NLRA because that policy infringes on employees Section 7 rights.  Flex Frac Logistics v. NLRB (5th Cir. 3/24/14).

The 5th Circuit review of the Board's decision finding a violation is straightforward:

  1. It is a violation of the NLRA to have a workplace rule that forbids discussion of confidential wage information between employees.
  2. The rule above does not explicitly do that, but it is also a violation if "employees would reasonably construe the language to prohibit Section 7 activity.
  3. Because the clause covers financial information, including costs, that "necessarily includes wages and thereby reinforces that the rule proscribes wage discussion with outsiders."
  4. And the rule makes no attempt exclude some personnel information such as wages, which might make it pass muster.
And less you think this is the opinion of some of the newer members of the 5th Circuit who might have a more liberal bent, the opinion is authored by Chief Judge Stewart and joined by Judges Higginbotham and Jones. 

Confidentiality clauses are just one area of personnel policies that the new NLRB is putting under strict scrutiny. All employers, but particularly non-union employers, need to realize that there is a new entity around, and that not all its actions will be upended by the courts. 

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Monday, March 10, 2014

5th Circuit Short Circuits Plaintiff's Use of State Court

In certain parts of Texas, plaintiffs seek to avoid being in federal court at all costs. Today, the 5th Circuit clarified a procedural hurdle to that tactic in a small category of  cases.

In Taylor v. Bailey Tool & Manufacturing (5th Cir. 3/10/14), plaintiff originally filed suit in state court alleging only violations of the Texas anti-discrimination statute. Unfortunately, for the plaintiff, the claim was not timely filed. Later plaintiff amended to add Title VII and a Section 1981 claim.

Defendant removed and moved to dismiss arguing all claims were untimely.  Both parties agreed that the state claims were untimely.  Both parties also agreed that whether the federal claims were timely depended on whether Federal Rule of Civil Procedure 15(c) or the Texas relation back rule, TEX. CIV. PRAC. & REM. CODE ANN. § 16.068 applied.

If Rule 15(c) applied, the federal claims, even though filed after the federal statute of limitations would be timely because they would relate back to the filing of the original claim. On the other hand, if the Texas rule applied, they would not be timely because § 16.068 prohibits relation back if the cause of action would have been subject to a plea of limitation when filed.

The 5th Circuit joined the two other circuits (the 6th and 9th)  that had ruled on this matter, holding that the state rule applied, thus barring the claim.

The net result is that plaintiffs will have to make sure that their state claim is timely if they want to avoid federal court.

A simple and straight forward, but important, holding.

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How Much Would it Take to Wet Your Whistle?

That's a 64 million dollar question, literally. JP Morgan whistleblower gets $63.9 million in mortgage fraud deal. 

It seems quite likely that headlines like that are apt to make many think that rather than continuing to work as an assistant vice president, as Keith Edwards did before reporting that JP Morgan was submitting mortgages for FHA and VA approval that did not qualify, and apparently not notifying the government that its own internal review had disclosed the problem, that it might make sense to play a new version of the lottery. 

Couple that with the Supreme Court's decision last week expanding the reach of yet another major whistle-blowing statute, Supreme Court Exapnds Scope of Sarbanes-Oxley Whistleblower Liability, and employers and their counsel just have more to think about.

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Thursday, February 13, 2014

5th Circuit's View on Extraterritorial Application of SOX? Not Yet

One of the many issues still to be decided for whistle-blowing claims under Sarbanes Oxley is how far does the law extend, if at all, for conduct outside the United States.

A Colombian national who had alleged his employer, an affiliate of a U.S. company, was violating Colombian tax law hoped to find the answer to that question.

OSHA had rejected his complaint, finding that because the adverse employment actions, the denial of a pay raise and his termination, had occurred outside the U.S. it had no jurisdiction.  Following his appeal, the Administrative Law Judge agreed, finding §806 of SOX has no extra-territorial application. The Administrative Review Board agreed, primarily because there was no connection between the alleged violation of Colombian law and U.S. securities or financial disclosure law.

Undaunted,  he turned to the 5th Circuit Court of Appeals, but fared no better. Agreeing his complaint failed because it failed to allege a violation of  “one of the six enumerated provisions of U.S. law.”

The question of extraterritorial application? A decision for a later day:
Because we affirm on this narrower ground, we need not reach the argument, advanced by the government and Core Labs, that § 806 does not apply extraterritoriality.

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Monday, February 10, 2014

50 Years Ago, The Civil Rights Act of 1964 Passes the House of Representatives

The statute that among many other things marked the beginning of employment law as a discipline, passed a major hurdle 50 years ago today when it passed the House of Representatives by a vote of 290 to 130.

According to a study of the Civil Rights Act's legislative history, The Longest Debate by Charles and Barbara Whalen, the final vote was 290 to 130.
Supporting the bill were 152 Democrats and 138 Republicans. Opposing it were 96 Democrats (including 86 from the 11 states of the Confederacy) and 34 Republicans, including 10 from the South.
Hard to imagine in light of today's partisan divide in both chambers of Congress.

Regarding Title VII, the bill that was passed and sent to the Senate was actually stronger than the one originally introduced.  It had gone beyond enforcement by persuasion to creating for the first time a private cause of action, albeit one that was much more limited than it would become with the passage of the Civil Rights Act of 1991.

While the passage by the House of Representatives was a major feat standing alone, it was by no means certain that it would amount to more than a grand gesture as the bill now went to the Senate where it awaited a certain filibuster.

I am quite certain that on this date 50 years ago when I was looking forward to the end of 8th grade at Sulphur Springs Junior High School, and the prospect of actually being in high school,  I had no idea that legislation which would change the world as we knew it had achieved such a major step. And certainly no thought that legislation was moving through Congress that would create a new field of law that would ultimately be the way I would spend my entire professional life.

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Saturday, February 08, 2014

Happy 50th, Sex As a Protected Category

Fifty years ago, on another February Saturday, after what had been a grueling fight to pass a strengthened Civil Right bill out of the House, Representative Howard Smith (D-VA) who had lost his battle to bottle the bill in the Rules Committee that he chaired, offered an amendment on the floor of the House to expand the protected categories from race, color, national origin and religion, by adding sex.

Some have viewed his amendment as one last ditch effort to sink the bill, others a slightly more nuanced version that seeing that the bill was ultimately going to pass, Representative Smith sought to make the bill better.

Although there was initial push back from the Democratic floor managers, and much joking colloquy, the amendment ultimately passed.

Whichever view is true, there is no doubt how the world has changed because of what happened 50 years ago today.

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Tuesday, December 17, 2013

Next Year's Headache for Employers

Not to ruin the Christmas season, but when you get through the holidays and start focusing again on looming legal issues, you might want to read this article, Lawsuit Raises FCRA Fears, by Kristen Fratsch in Human Resource Executive On Line.

The basis for the lawsuit is a class action suit against Disney, based on alleged failure to notify an applicant that he was not being hired because of a criminal conviction that showed up on a background check. According to the plaintiff's side of the story, the assault occurred when he was 19, was expunged from his record and the credit reporting agency ultimately removed it. Disney has not answered, so it may well have complied with the Fair Credit Reporting Act.

However, according to Fratsch since 2010 there have been been 368 class action lawsuits filed under the FRCA.

In employment law, most  litigation has traditionally involved termination of employment. Which makes sense because in those cases an employee at one time got the job, performed for some period of time, and the employer had to make a conscious decision and carry it out appropriately. Plus, the employee has a vested interest based on his investment in time with his ex-employer and a track record of earnings that will support a damage claim. Not to mention the emotional involvement that comes out of being terminated.

By contrast, hiring claims are not as economically viable. There are lots of applicants for most positions and courts are reluctant to second guess hiring decisions if it seems to be a reasonable choice. Plus applicants generally don't know why they weren't hired, and don't have the emotional level of investment they have when someone has terminated them, plus damages are problematic.

But when you throw in the possibility of a class recovery, with the dollar signs that inevitably follow class litigation, now you have an incentive, not so much for individual employees, but for law firms that focus on class or collective action based employment litigation.

So, for now enjoy the holidays, but in the not too distant future, remind yourself of an employer's obligations under the FCRA and make sure that you are in compliance.

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Thursday, December 05, 2013

Keyboard Filing - Being a Whistleblower Just Got a Lot Easier

It will be interesting to see what the response is to today's announcement by the Department of Labor that complaints under any of the 22 federal whistleblowing statutes that OSHA enforces may now be filed on line.

Here's the gist of the DOL press release:

Whistleblowers can now file complaints online with OSHA
Agency launches online form to provide workers a new way to file retaliation complaints

WASHINGTON – Whistleblowers covered by one of 22 statutes administered by the U.S. Department of Labor’s Occupational Safety and Health Administration will now be able to file complaints online. The online form will provide workers who have been retaliated against an additional way to reach out for OSHA assistance online. 
Currently, workers can make complaints to OSHA by filing a written complaint or by calling the agency’s 1-800-321-OSHA (6742) number or an OSHA regional or area office. Workers will now be able to electronically submit a whistleblower complaint to OSHA by visiting

The new online form prompts the worker to include basic whistleblower complaint information so they can be easily contacted for follow-up. Complaints are automatically routed to the appropriate regional whistleblower investigators. In addition, the complaint form can also be downloaded and submitted to the agency in hard-copy format by fax, mail or hand-delivery. The paper version is identical to the electronic version and requests the same information necessary to initiate a whistleblower investigation.

Unlike some other government websites that have been in the news recently, this one at least opens.

If you are now curious about the form, click here.

It will be interesting to see how quickly individuals learn of this availability and what happens with the number of complaints. The discrimination/retaliation section is unusual because the individual does not have to designate which statute the complaint is filed under, nor is there any description of what the 22 laws cover.

On the information you are suggested to read before completing the form, OSHA says what is going to happen when the complaint is submitted:

Upon receipt of a complaint, OSHA will contact the complainant to determine whether to conduct an investigation. It is very important that a complainant respond to such contact; if a complainant is unresponsive, OSHA cannot proceed with an investigation and the complaint will be dismissed. If OSHA proceeds with an investigation, the complainant will have an opportunity to offer documents and other evidence in support of the complaint, and the employer will be notified of the allegation and permitted to submit a response.
 OSHA does include this admonition:
The announced intention is that everyone who submits a form will be contacted by OSHA.

This is going to be interesting; for employers, not necessarily in a good way.

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Tuesday, November 05, 2013

Two Names You May Not Know and May Never Hear Much About

But if you are at all interested in what may be coming out of new NLRB General Counsel Richard Griffin's office, and if you are an employer you should be, then you should at least know of Jennifer Abruzzo and Rachel Lennie, the new deputy general counsel and assistant general counsel respectively.  See Corporate Counsel's, New NLRB GC Begins Building Labor Legal Team.

Because the GC controls what cases are initiated the legal judgments as to what kinds of cases and the theories on which they will be brought will rest primarily in the hands of these three for the next four years.

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