In recent years, “English-only” workplace policies have garnered increased scrutiny under employment discrimination laws on the state and national levels. Employers with these policies need to take note of recent updates to state statutes and regulations governing the lawfulness of “English-only” workplace policies and the overall broadening scope of other bases for discrimination claims.

California, for example, has recently codified existing case law protecting job applicants and employees from harassment, discrimination and retaliation on the basis of national origin. These new regulations on national origin classifications under California’s Fair Employment and Housing Act (FEHA) took effect July 1, 2018.

The new FEHA regulations define “national origin” broadly, so as to include an individual’s or ancestor’s actual or perceived:

• Physical, cultural or linguistic characteristics associated with a national origin group;
• Marriage to, or other association with, persons of a national origin group;
• Tribal affiliation;
• Membership in or affiliation with an organization identified with or seeking or promoting the interests of a national origin group;
• Attendance or participation in schools or religious institutions generally used by persons of a national origin group; and
• Name that is associated with a national origin group.

The regulations define the term “national origin group” to include ethnic groups, geographic places of origin, and countries not presently in existence. The regulations apply to all applicants and employees, regardless of whether they are documented.

The new FEHA regulations provide some guidance with respect to “English-only” or language restriction policies. These policies are regarded as unlawful under the FEHA, unless the policy is justified by business necessity, is narrowly tailored, and the employer has instructed employees about how and when the restriction applies as well as the consequences of violating the policy.

The “business necessity” hurdle will likely be a hard one for most California employers to clear. A business necessity is an overriding business purpose, such that: the policy is necessary for the safe and efficient operation of the business; the policy fulfills the business purpose it is intended to serve; and there is no alternative practice that would accomplish this business purpose equally well with a less discriminatory impact. Merely promoting business convenience is not sufficient, nor is customer or co-worker preference.

Discrimination based on an applicant or employee’s English proficiency is also unlawful under the new California regulations, unless an English proficiency requirement is justified by business necessity. Relevant factors for determining business necessity as to an English proficiency requirement include the type of proficiency required (i.e. spoken or written), the degree of proficiency required, and the nature and duties of the job itself.

Employers will note that the new California FEHA regulations take a more restrictive approach to “English-only” policies than guidance from the Equal Employment Opportunity Commission (EEOC). The EEOC presumes that policies requiring employees to speak only English at all times are unlawful. “English-only” policies that apply in limited circumstances are lawful where the policies are job-related and consistent with business necessity. This standard may be satisfied by an employer’s showing that requiring employees to speak a common language is sufficiently necessary to safe and efficient job performance or safe and efficient business operations to override the policy’s adverse impact, and that the policy is narrowly tailored to minimize any discriminatory impact the policy may have. The EEOC also requires that employers provide employees with adequate notice of any language restriction policies. The EEOC guidance can be found here.

Employers in all states should tread cautiously when it comes to “English-only” or other language-restriction policies. Employers who currently utilize these policies, or who may be considering implementing them, should closely evaluate the lawfulness of the policy under the EEOC’s guidance and any state-specific statutes or regulations. For questions, or to discuss how your business may be impacted by restrictions on “English-only” policies, please contact any of the attorneys in our Employment & Labor Practice Group.

The U.S. Supreme Court issued its opinion June 27 in Janus v. American Federation of State, County, and Municipal Employees, Council 31, 585 U.S. ___ (2018), holding that nonunion members working in union positions for public employers are not obligated to pay agency fees, also known as “fair share” fees. This overturns Abood v. Detroit Board of Education, 431 U.S. 209 (1977) which set the precedent that as long as the agency fees represent the percentage of the union’s expenditures for collective bargaining, contract administration, and grievance adjustment purposes, then state governments can legislate that public employees employed in positions represented by unions, even though not union members, can be required to pay service charges or agency fees. In conjunction, unions are required to provide detailed notices of how the agency fees are being spent for “chargeable” activities (contract and bargaining based activities) and “non-chargeable” activities (political and lobbying activities). It should be noted that federal law prohibits unions that bargain for federal workers to charge agency fees to nonunion members, but according to the U.S. Department of Labor’s Bureau of Labor Statistics, about 27 percent of the federal workforce are union members.

The practical effect of the Abood case is that it provided unions that bargained for governmental employees a huge increase in agency fee revenue to perform their contract and bargaining functions, while member fees could be used for political purposes. In the private sector, it further justified union security agreements that similarly require that nonmember employees pay “fair share” fees for working in unionized positions and receiving the benefit of the unions’ bargaining efforts.

Given that union efforts and motives are fundamentally intertwined with politics and policy making, nonunion members who have been forced to pay agency fees have protested that agency fee laws and union security agreements violate their First Amendment rights to free speech. This is the exact argument that Mark Janus, a child support specialist for the Illinois Department of Healthcare and Family Services, made in the present case.

Janus argued it was a violation of his First Amendment rights to be obligated to pay fees to the American Federation of State, County, and Municipal Employees (AFSCME) under the Illinois Public Labor Relations Act (IPLRA) because he fundamentally disagreed with the politics of the union and many of the positions taken during collective bargaining. While Janus opted out of membership in AFSCME, because he worked in a union position he was still obligated to pay his agency fees (around 78 percent of what a union member paid). The case was initially filed by Illinois Gov. Bruce Rauner arguing that the IPLRA was unconstitutional, and Janus later joined. The Northern District of Illinois dismissed the case, stating that it was foreclosed by Abood, and the Seventh Circuit affirmed the decision.

Justice Samuel Alito, Jr. wrote the Supreme Court’s opinion, specifically holding: “Neither an agency fee nor any other payment to the union may be deducted from a nonmember’s wages, nor may any other attempt be made to collect such a payment, unless the employee affirmatively consents to pay.” Justice Alito reasoned that the main arguments in support of the Abood decision in 1977 are no longer compelling. Specifically, in responding to the argument that agency fees are necessary to prevent nonmembers from enjoying the benefits of collective bargaining without having the burden of paying for them, Justice Alito wrote: “In simple terms, the First Amendment does not permit the government to compel a person to pay for another party’s speech just because the government thinks that the speech furthers the interests of the person who does not want to pay.” The court reasoned that there are less restrictive means to prevent the “free rider” situations, for example, obligating nonmembers to pay for grievance support.

In her dissent, Justice Elena Kagan explained that the decision will amount to severe consequences: “Public employee unions will lose a secure source of financial support. State and local governments that thought fair-share provisions furthered their interests will need to find new ways of managing their workforces.” According to the Bureau of Labor Statistics, in 2017 approximately 34.4 percent of public sector employees (7.2 million) and 6.5 percent of private sector employees (7.6 million) belonged to a union. “Within the public sector, the union membership rate was highest in local government (40.1 percent), which employs many workers in heavily unionized occupations, such as teachers, police officers, and firefighters.” While it is not readily known how many of these public employees are nonunion members paying agency fees, the potential impact of union budgets of losing agency fees is great and is expected to have a substantial impact on their operations.

State right-to-work movements

While the Janus opinion only has an immediate impact on governmental employees, it speaks to the greater right-to-work movement in many states. Missouri passed a law in early 2017 that would prohibit employers from requiring employees to join a union or pay union dues as a condition of employment. However, the law was prevented from taking effect when opponents collected enough petition signatures to force a referendum on the matter. Missouri voters will decide in a statewide vote on the Aug. 7, 2018, primary ballot whether the Missouri right-to-work law will take effect.

We anticipate that Missouri right-to-work proponents will use the Janus opinion to argue that even the U.S. Supreme Court agrees that employees should be afforded with the opportunity to elect to pay for union benefits even if their coworkers have organized. If Missouri’s law goes into effect, it will join 27 other states that have banned union security agreements between unions and companies that require nonunion members to pay “fair share” fees. We also anticipate the right-to-work movement to gain strength in the Illinois private sector.

If you have questions about how state labor laws affect your business, please contact one of the attorneys in our Employment & Labor practice group.

On June 9, 2018, Kansas City, Missouri’s “ban-the-box” ordinance went into effect. The ordinance is applicable to private employers with six or more employees and is being touted as Ban-the-Box-PLUS, since it not only prohibits the use of questions about criminal background on the job application form but also requires employers to have additional justifiable reasons for using an applicant or employee’s criminal background as the basis for any employment decision.

Specifically, the ordinance prohibits employers from “basing a hiring or promotional decision on an applicant’s criminal history or sentence related thereto, unless the employer can demonstrate that the employment–related decision was based on all information available including consideration of the frequency, recentness and severity of a criminal record and that the record was reasonably related to the duties and responsibilities of the position.” Section 38-104

Additionally, an employer may not request information about an applicant’s criminal history until after the employer has determined that he or she is otherwise qualified for the position and has been interviewed. Further, if the employer does ask about applicants’ criminal histories, it must make the request on all of the individuals in the final pool of candidates for the position.

The ordinance is not applicable to “positions where employers are required to exclude applicants with certain criminal convictions from employment due to local, state or federal law or regulation.” Section 38-104(b). Remedies for violation of the law include reinstatement, back pay, actual damages and civil penalties.

Kansas City joins Columbia as the second Missouri city to enact a ban-the-box law applicable to private employers. Several municipalities and the state of Missouri have instituted similar laws with respect to hiring governmental employees. Given that cities and states across the country are enacting ban-the-box laws on a virtually monthly basis, employers must remain vigilant and commit to reviewing their application forms and hiring practices on a regular basis, especially if they are hiring across multiple jurisdictions.

If you have questions about whether there are ban-the-box laws that affect your company’s hiring and employment practices, please contact one of the attorneys in our Employment & Labor practice group.

On June 4, 2018, the U.S. Supreme Court released its long-awaited decision in Masterpiece Cakeshop, Ltd v. Colorado Civil Rights Commission, 584 U.S. ___ (2018), which examined whether a Colorado bakery violated that state’s Anti-Discrimination Act by refusing to bake a wedding cake celebrating a same-sex marriage ceremony. While a 7-2 majority of the court sided with the bakery, the much-anticipated decision left more questions unanswered than answered. The decision and concurring and dissenting opinions can be read here.

In 2012, bakery owner Jack Phillips refused to create a cake for the same-sex wedding of Charlie Craig and Dave Mullins. Phillips, a devout Christian, claimed that requiring him to create such a cake would violate the Free Exercise Clause of the First Amendment because it would require him to engage in conduct contrary to his deeply held religious beliefs. Phillips also claimed that the cakes he created reflected his artistic expression and, therefore, requiring him to create a wedding cake for a same-sex couple would violate his First Amendment right to free expression. Craig and Mullins filed a complaint with the Colorado Civil Rights Commission, and that commission concluded that Phillips violated Colorado’s Anti-Discrimination Act. A Colorado appellate court also ruled in favor of Craig and Mullins, and the case proceeded to the U.S. Supreme Court.

What did the court decide?

The Supreme Court ruled in favor of Phillips. While recognizing that protected religious and philosophical beliefs, as a general rule, cannot be used to deny protected persons equal access to goods or services under a neutrally applied public accommodations law, the court took issue with the Colorado Civil Rights Commission’s conduct in respect to Phillips’ religious beliefs. The court took note of comments from the commission that Phillips’ religious belief had no place in the public domain and another comment comparing Phillips’ religious beliefs to defenses of slavery and the Holocaust. The court also looked at the commission’s handling of three cases in which bakeries refusing to bake cases with anti-same-sex marriage messages were found not to have violated the law based on factors deemed irrelevant in Phillips’ case. Viewing the commission’s conduct as not neutral with respect to Phillips’ religious beliefs, the court concluded that the commission’s decision violated the Free Exercise Clause.

What did the court not decide?

Perhaps more important than the court’s ruling is what is not included in that decision. The court did not decide that business owners can lawfully refuse to provide goods or services based on deeply held religious beliefs. Although Justice Gorsuch authored a concurring opinion suggesting that Phillips’ conduct did not violate Colorado’s Anti-Discrimination Act, only Justice Alito joined that opinion. Similarly, the court did not decide whether Phillips could lawfully refuse to create a wedding cake for a same-sex wedding, although Justice Thomas (joined by Justice Gorsuch) authored a concurring opinion supporting Phillips’ position. By basing its opinion on the specific facts of this case, the court issued an opinion with a very narrow reach. As the court’s majority opinion noted,

The outcome of cases like this in other circumstances must await further elaboration in the courts, all in the context of recognizing that these disputes must be resolved with tolerance, without undue respect to sincere religious beliefs, and without subjecting gay persons to indignities when they seek goods and services in an open market.

What does this mean for employers and business owners?

Local, state and federal laws vary on the protections afforded to LGBTQ individuals in employment situations and public accommodations. Accordingly, businesses should familiarize themselves with their local public accommodations and employment laws when considering what services to offer and determining when they can be refused. There is also a general disagreement between the U.S. Courts of Appeals regarding whether Title VII can be extended to include sexual orientation and transgender status as protected categories under federal law. The EEOC and other government agencies have taken a hard-lined approach and argue that the various federal anti-discrimination employment laws do provide protections to the LGBTQ community. With so much uncertainty regarding what laws do and do not provide protection, what should employers do?

The short answer is, treat everyone equally and fairly. Here are a few tips to help establish a fair treatment framework:

1. Maintain anti-discrimination policies that legally encompass all of the protected categories currently identified by applicable laws in your jurisdiction, and be prepared to update them on a regular basis. Ensure that your anti-discrimination policies include employee interaction with outside persons (customers, vendors, etc.) and vice versa.
2. Establish a clear reporting process for discrimination and harassment complaints and train managers on how to recognize and respond to complaints appropriately. Ensure that the staff members charged with investigating complaints are thoroughly trained on how to do so.
3. Conduct regular anti-discrimination and anti-harassment training for all employees. In fact, several states have recently enacted laws that requiring annual anti-harassment training for public and private employers.
4. Be respectful and open to all opinions and beliefs, even those that may be unpopular. The Colorado Commission essentially lost its case because its representatives were openly hostile toward the baker’s beliefs.
5. Check out our other blog posts and articles for helpful tips regarding specific anti-discrimination situations, including here and here.

If you have questions about the state of the law in your jurisdiction, how to draft or implement anti-discrimination policies and training or how the Supreme Court’s decision impacts your business, please contact one of the attorneys in our Employment & Labor department.

In a 5-4 decision written by newcomer Justice Gorsuch, the U.S. Supreme Court upheld employment agreements that require employees to individually arbitrate disputes with their employers.

The May 21, 2018, opinion in Epic Systems Corp. v. Lewis resolves a trio of cases before the Supreme Court in which employees brought suits against their employers alleging state and federal wage and hour violations. In each situation, the employees had signed contracts agreeing to resolve any employment-related disputes in individualized arbitration. Nevertheless, they sought to litigate their claims in class or collective actions. 

The Federal Arbitration Act (FAA) generally requires courts to enforce such arbitration agreements as written. Yet the employees argued that the National Labor Relations Act’s (NLRA) guarantee that employees may engage in concerted activities conflicts with the FAA’s directive. As a result, the employees argued that the class waivers in question were unenforceable.

The court disagreed, explaining that courts are only relieved of their obligation to give effect to arbitration agreements when a traditional rationale for the rescission of a contract is presented, such as fraud or duress. Additionally, the court found that the NLRA gives no indication that Congress intended to displace the FAA’s general scheme: The NLRA does not mention class or collective procedures and those methods of dispute resolution were, in fact, “hardly known” when the NLRA was adopted.

The court also explained that participation in class or collective actions does not qualify as “concerted activities” under the NLRA because that term only refers to actions that “employees ‘just do’ for themselves in the course of exercising their right to free association in the workplace.” In other words, the NLRA’s protection does not extend to the “highly regulated, courtroom-bound ‘activities’ of class and joint litigation.”

The court explained that its conclusion was entirely in line with its longstanding precedent of rejecting efforts to “conjure conflicts between the [FAA] and other federal statutes.” The court also emphasized that its decision is consistent with nearly 80 years of case law that remained largely untouched until the National Labor Relations Board asserted for the first time in 2012 that the NLRA nullifies the FAA in some cases.

As a result of this ruling, employers are free to incorporate class and collective action waivers into agreements with employees, although as Justice Gorsuch recognized, “Congress is always free to amend this judgment.”

If crafted properly, then such an agreement also would apply to claims employees may bring under the Employee Retirement Income Security Act of 1974 (ERISA). However, employees have successfully argued that claims for fiduciary breaches brought under ERISA § 502(a)(2), 29 U.S.C. § 1132(A)(2), are not subject to arbitration agreements with class action waivers. ERISA § 502(a)(2) claims, employees assert, are brought on behalf of the plan, and employees cannot waive the plan’s rights to litigation. The Ninth Circuit will soon decide this issue in Munro v. USC, and it is likely that issue will continue to be litigated in district and circuit courts.

For more information about this case or for assistance in drafting enforceable arbitration or other employment agreements, contact our attorneys in the Employment & Labor or Employee Benefits Practice Groups. 

The Missouri legislature has approved a proposal that moves the date of a public vote on the state’s right-to-work law to the August 2018 ballot.

The proposal was approved 96-47 in the Missouri House on May 17. The Senate had already passed the measure. The legislative approval moves a statewide vote on whether to prevent the Missouri right-to-work law from taking effect from November to the Aug. 7 primary ballot. 

If allowed to become effective, Missouri’s right-to-work law would prohibit employers from requiring employees to join a union or pay union dues as a condition of employment. The right-to-work law was passed in early 2017, but the law was prevented from taking effect when opponents collected enough petition signatures to force a referendum on the matter.

We will continue to monitor this topic and will provide updates as they occur. If you have any questions about the right-to-work law, please contact any of the attorneys in our Employment & Labor practice group.

On May 8, 2018, a Missouri Senate committee approved a proposal to have voters decide in August 2018, rather than November 2018, whether to prevent the Missouri right-to-work law from taking effect. If allowed to become effective, the right-to-work law would prohibit employers from requiring employees to join a union or pay union dues as a condition of employment.

Approval by the Senate Rules, Joint Rules, Resolutions and Ethics Committee sends the issue to the full Senate. If the proposal obtains the approval of both chambers, the question will appear on the Aug. 7, 2018, primary ballot instead of the November ballot.

As you may recall, the right-to-work law was passed in early 2017, but the law was prevented from taking effect when opponents collected enough petition signatures to force a referendum on this matter.

We will continue to monitor this topic and will provide updates as they occur. If you have any questions about the right-to-work law, please contact any of the attorneys in our Employment & Labor practice group.

As we reported last fall, the Seventh Circuit Court of Appeals determined that a multi-month continuous leave of absence is beyond the scope of a reasonable accommodation under the ADA. The case was Severson v. Heartland Woodcraft, Inc., 872 F.3d 476 (7th Cir. 2017). After exhausting 12 continuous weeks of FMLA leave for a serious back condition, Severson informed his employer that he would need to remain off work for another two to three months. The Seventh Circuit reasoned that the ADA is an antidiscrimination statute, not a medical leave entitlement, and an employee who needs long-term medical leave cannot work and is therefore not a qualified individual under the ADA.

The Seventh Circuit subsequently issued a similar, although non-precedential, opinion in the case of Golden v. Indianapolis Housing Agency, 698 Fed.Appx. 835 (7th Cir. 2017). There, the Seventh Circuit determined that an employee who needed an additional period of continuous leave not to exceed six months after her FMLA ended could not work and thus was not a qualified individual with a disability under the ADA. The court stated, “Severson requires us to hold that a request for six months of medical leave in addition to the twelve weeks required by the FMLA removes an employee from the protected class under the ADA and the Rehabilitation Act. In short, because [the employee] is not a qualified individual, the district court correctly granted summary judgment to [the employer].”

Severson filed a petition for a writ of certiorari with the U.S. Supreme Court. Last week, the Supreme Court decided it will not take the case, leaving the Seventh Circuit’s decision intact.

Now what?

The Seventh Circuit has reached a conclusion that other federal courts of appeal have not. At this time, employers in the Seventh Circuit (Illinois, Indiana and Wisconsin) are generally the only ones that should rely on Severson and take the more aggressive position that they do not have to provide multi-month leaves under the ADA. Seventh Circuit employers should not lose sight of the fact that the EEOC’s position that extending a leave of absence for a definite amount of time is a reasonable accommodation has not changed, so they may still be subject to EEOC scrutiny, and state leave laws may come into play as well. Accordingly, employers should continue to engage in the interactive process, and each employee situation should be considered on a case-by-case basis.