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SHRM Newsletter- Interesting Things About Employment Law in 2013
Posted on Jan. 15, 2013

This is Utah SHRM Legal-mail no. 2013-1 prepared for Salt Lake SHRM, the Human Resources Association of Central Utah (HRACU), the Northern Utah Human Resources Association (NUHRA), the Color Country Human Resources Association (CCHRA), the Bridgerland Society for Human Resource Management and Utah at-large members of the national Society for Human Resource Management (SHRM). 

CONTENTS:

INTERESTING THINGS ABOUT EMPLOYMENT LAW IN 2013

-  INTRODUCTION

-  THE NLRB AND FACEBOOK, ETC.

-  EEOC/UALD

-  SOCIAL MEDIA

-  PERFORMANCE REVIEWS

-  OBAMACARE

-  LITIGATION HOLDS

INTRODUCTION: Happy New Year! In early January of 2013, my partners Bruce Babcock, Mark Tolman and I presented an employment law update to the Salt Lake SHRM members.  We discussed interesting issues in employment law for 2013. Interesting (in·ter·est·ing or ntr-stng, -tr-stng, -t-rstng) means “adj. Arousing or holding the attention; absorbing.” We tried to answer the question:  what should interest you about HR Law in the coming year? The highlights are summarized below.

THE NLRB AND FACEBOOK, ETC: The National Labor Relations Board (NLRB) is now controlled by appointees of President Obama and is more employee-friendly than often has been the case in the past. This new NLRB has issued a number of opinions for even non-union employers. The NLRB has told employers that employee Facebook communications may well be communications with co-workers protected by the National Labor Relations Act (NLRA). The NLRA protects the right of employees to act in concert (by communications or actions) to address or improve the terms and conditions of their employment. The NLRB has provided a sample social media handbook policy which it believes is compliant with the NLRA. A copy of this sample policy is found on the NLRB website: http://nlrb.gov/news/acting-general-counsel-releases-report-employer-social-media-policies  The NLRB also announced that employer arbitration and class action waiver agreements imposed as a condition of employment violate the NLRA because they limit employee rights to act collectively. Many courts have disagreed with the NLRB on this ruling. Recently, the NLRB also ruled that a policy prohibiting defamatory statements about the company may violate the NLRA if they are written so broadly that they can be construed as prohibiting employee statements criticizing management.  Finally, the NLRB has ruled that employer contract disclaimers commonly found in employee handbook acknowledgment forms may violate the NLRA because they could chill employee discussions aimed at improving their working conditions and/or creating a union and thus changing at-will status through a collective bargaining agreement. The bottom line? Non-union employers used to dealing with Occupational Safety and Health Administration (OSHA), the Equal Employment Opportunity Commission (EEOC) and the Department of Labor (DOL) now must accept the reality that there the NLRB also will be broadly imposing its own regulatory framework on such employers. Learn what the NLRA requires of you and comply!

EEOC/UALD: There are about 100,000 charges filed annually with the EEOC (near-record levels). The EEOC files 200-300 lawsuits- most on systemic issues--and collects from employers some $400-500 million in damages and settlements annually. The most frequently-filed charges? Usually retaliation and race discrimination. Religion, disability and age charges also are increasing, and there are always lots of sexual harassment claims. The best way to deal with the EEOC is to have (and be able to articulate) clear and legitimate business reasons for disputed employment actions and show documentation for the same.

SOCIAL MEDIA: Be careful what you learn about applicants and employees on social media. Ignorance is bliss when defending against a discrimination charge!  Social media contains a host of information about race, religion, pregnancy, and other protected characteristics. The EEOC has stated that online screening tools are permissible so long as they analyze only job-related factors. But how do you prove that only job-related factors were considered? Social media screening may also cause problems under GINA (Genetic Information Nondisclosure Act), which prohibits employers from acquiring genetic information about applicants or employees. Consider adopting a policy that prohibits social media screening. If social media screening is just too tempting, then adopt a structured screening approach where trained HR professionals examine social media information and pass along only job-related information to hiring managers. Social media can also be an effective tool to market and promote your company.  But steps should be taken to make sure that employees identify their affiliation with your company when they promote it online. Failing to do so could lead to trouble with the Federal Trade Commission.   

PERFORMANCE REVIEWS: There are at least three reasons performance evaluations are so important. They are an employee’s report card – how well is he/she doing? They present an opportunity to praise a good employee and manage a not-so-good one. Finally, if done right, they can be helpful evidence for an employer in legal disputes with employees or former employees. The problem we are seeing recently--are you evaluating your top managers (e.g. CEO, CFO, CHRO) and your highest compensated employees? Here are some tips for doing good performance reviews: (1) Evaluate ALL your employees (including top management); (2) Be honest and take time to do a good job; (3) Evaluate for the whole period (e.g. one year)—don’t short time someone; (4) Evaluate only job-related matters; (5) Don’t “soft pedal” or “slam” due to personal feelings of like or dislike and (6) Don’t evaluate when angry.

OBAMACARE:  The incremental implementation of the Patient Protection and Affordable Care Act (a/ka Obamacare) continues. Employers issuing more than 250 Forms W-2 are required to include the aggregate cost of employer-sponsored group health insurance in Box 12. This requirement is for information reporting only but critics fear it is a precursor to taxing employer-provided health insurance. A 0.9% increase in Medicare tax (from 1.45% to 2.35%) goes into effect in 2013 on wages and self-employment income over $200,000 for single filers and over $250,000 for joint filers. In addition, a new 3.8% Medicare surtax is imposed on some or all of the net investment income of individuals whose income exceeds $200,000 for single filers and $250,000 for joint filers. Employers should prepare now for the employer mandate (so-called “pay or play”) which goes into effect in 2014. Employers with more than 50 full-time equivalent employees will be required to either: (1) provide affordable, “minimum essential” health insurance coverage to its full-time employees (i.e., those working more than 30 hours per week) or (2) pay a “no-coverage” penalty of $2,000 per full-time employee (but no penalty for the first 30 employees) or “inadequate coverage” penalty of $3,000 per employee receiving tax credits through an insurance exchange. The federal government recently announced that the State of Utah insurance exchange known as Avenue H has received conditional approval under Obamacare. 

LITIGATION HOLDS: More of what employers do today is done electronically--email, texting, etc. The convenience and efficiency of electronic communication also means that employees typically will create more documentation (that is stored somewhere) about their various activities. Thus, when a dispute, lawsuit or claim (e.g. an EEOC claim) arises, more of the evidence related to the same will be in an electronic format.  Employers must take steps to issue litigation hold notices when such circumstances arise. Indeed, most agencies will include an instruction to hold records when they send an employer a copy of the charge filed against it. A litigation hold notice is a prompt and written communication to the involved persons (the likely custodians of records relevant to the particular dispute), as well as to the company’s IT department, asking all such persons to take steps to preserve all records (electronic or otherwise) possibly related to the case. This hold must include having IT suspend normal and automatic e-mail or e-record deletion processes. The failure to put a litigation hold on possibly-relevant records can haunt an employer involved in such a dispute, even if the employer has good defenses on the underlying claim. This happens because courts and agencies can choose to penalize such employers who let records be destroyed.  And such penalties can include drawing adverse inferences, i.e. concluding that the destroyed or missing documents would have hurt the employer’s arguments, or simply refusing to recognize certain employer defenses at all. Don’t let this happen to you. Make sure you have a litigation/dispute records hold policy in place and that you trigger it whenever required to preserve documents that may be relevant to an underlying employment dispute. Here are four simple steps you can follow to master the concept of litigation hold letters:

Step One:  Identify Potential Custodians of Data and Records

  • Identify the “Custodians” –

    • Those who have played a material role in the transactions giving rise to litigation (the “Players”);
    • Those who may have assisted the Players.
  • This Process Should Be Performed QUICKLY and UPDATED as New Information Becomes Available.

Step Two: Define The Relevant Time Period

  • Interview Custodians to Define Parameters for Retrieval and Retention Efforts.
  • Performed by In-House or Outside Counsel.

    • Greater Level of Independence
    • Preserve Confidentiality
  • MAKE A CONSERVATIVE ESTIMATE.

Step Three: Identify “Type” and “Location”

  • Interview IT staff and Custodians
  • Where INSIDE of the IT system do potentially discoverable data and records reside?
  • Where OUTSIDE of the IT system do potentially discoverable data and records reside?

Step Four: Implement Company-Wide “Litigation Hold”

  • Circulate “Litigation Hold” Memorandum to ALL Potential Custodians.
  • Define the Particulars of the Litigation and the Scope of the Preservation Effort.
  • Instruct ALL Recipients (Including IT Staff) to PRESERVE and NOT DESTROY ALL Records and
  • Data Relating to Litigation.
  • SUSPEND ALL AUTOMATED DELETION

 

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Author

mikeAttorney Michael
Patrick O'Brien

Mike O’Brien is an experienced and accomplished employment attorney, media lawyer and courtroom litigator.  He is active in SHRM and has received the highest possible reviews from rating services like Martindale - Hubbell (AV rating), Chambers USA, Utah Business Legal Elite, Best Lawyers in America, Who’s Who Legal USA, and SuperLawyers.  HR Executive Online has named him as one of America’s most powerful 100 employment lawyers, but keep in mind, this does not mean he is good at moving heavy furniture.

Awards and Recognition

OBrienAV

OBrien Best

Chambers 2011 Attorney

Super Lawyers
Michael Patrick O'Brien
 

Best Lawyers In America, “Salt Lake City Best Lawyers Employment Law Lawyer Of The Year,” 2011-2012

Best Lawyers In America, First Amendment Law, Labor And Employment Law, 2005-2012

Chambers USA, Labor & Employment, 2003-2011

Employment Lawyer Of The Year, Utah State Bar, 2001

Human Resources Executive, Nation’s Most Powerful Employment Lawyers In America, 2010

Mountain States Super Lawyers, 2007-2012

Utah Business Magazine, Legal Elite, Labor And Employment, 2006-2012