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SHRM Newsletter- EEOC Million Dollar Verdict Reduced Due to Statutory Caps
Posted on May. 16, 2013

This is Utah SHRM Legal-mail no. 2013-9 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). 







EEOC MILLION DOLLAR VERDICT REDUCED DUE TO STATUTORY CAPS: In the last update, I wrote about the Equal Employment Opportunity Commission’s (EEOC) recent record jury verdict totaling $240 million in an employment case. The case involved claims, by 27 persons with intellectual disabilities, that they were subjected to severe abuse and discrimination from their employer over a long period of time. The EEOC recently agreed that the damage awards are excessive and must be reduced to about id="mce_marker".6 million because federal compensatory discrimination claims (not for lost wages but for things like emotional distress and punitive damages) are subject to caps depending on the size of the employer. These caps are as follows: $50,000 (for 15-100 employees); id="mce_marker"00,000 (for 101-200 employees); $200,000 (for 201-500 employees); and $300,000 (for over 500 employees).

EEOC STATS SHOW WHERE MOST CHARGES FILED: Statistics recently released by the EEOC show that the Southern states of Texas and Florida, and the State of California, are the places where the most EEOC charges are filed. Georgia and Illinois followed on the top five list. As for types of charges, Alabama saw the most race discrimination charges filed, Texas led the way in age and sex discrimination charges; Florida topped the list for most national origin discrimination charges; and California led the way in disability discrimination claims. Almost 250 EEOC charges were filed by Utah residents, most alleging retaliation, disability bias or age discrimination.

FIRST GINA LAWSUITS FILED: The EEOC has filed what is believed to be the first two lawsuits under the Genetic Information Nondiscrimination Act (GINA). GINA prevents employers from demanding genetic information, including family medical history, and using that information in the hiring process. In the EEOC's first lawsuit (which was settled for $50,000 right after filing), the plaintiff was a temp working as a memo clerk for an Oklahoma fabrics distributor. When her temporary assignment was coming to an end, she applied for a regular job in that position. The employer made an offer of employment and sent the plaintiff to its contract medical examiner for a pre-employment drug test and physical. At the physical, the employee was required to fill out a questionnaire and disclose the existence of numerous separately listed disorders in her family medical history (e.g. heart disease, hypertension, cancer, tuberculosis, diabetes, arthritis and "mental disorders" in her family). The lawsuit followed after the company rescinded its job offer. Regarding the lawsuit, EEOC General Counsel David Lopez said, "Employers need to be aware that GINA prohibits requesting family medical history. When illegal questions are required as part of the hiring process, the EEOC will be vigilant to ensure that no one be denied a job on a prohibited basis." In the second lawsuit, according to the EEOC, a New York employer (a nursing and rehabilitation center) conducted post-offer, pre-employment medical exams of applicants, which were repeated annually if the person was hired and as part of this exam, the employer requested family medical history, a form of prohibited genetic information.

WAGE AND HOUR CLAIMS CONTINUE TO PROLIFERATE: Corporate Counsel magazine recently reported that the number of wage and hour lawsuits filed against employers in federal court have increased for the fifth straight year. Claims are up 10% over a twelve month period measuring part of 2012 and three months of 2013. Typically these are claims brought under the Fair Labor Standards Act (FLSA) involving misclassified employees seeking overtime pay, hourly workers claiming they were not paid for all hours worked or restaurant workers claiming they were not properly paid under tip credit rules. Wage and hour claims can also result from state law issues. For example, a national coffee company recently had to pay $3 million for allegedly not providing California employees with required meal breaks and for issuing inaccurate wage statements.

NEW YORK CLUB SETTLES EXOTIC DANCER EMPLOYMENT CLAIMS: I recently read that a “gentlemen’s” club in New York City has agreed to pay almost $9 million to settle a case brought by some 1,200 of its current and former exotic dancers who claimed they had been misclassified as independent contractors rather than employees. The plaintiffs also claimed they were not paid overtime or minimum wage, that their fees were confiscated and that the employer failed to pay for their...wait for it...uniforms. (Let’s pause here for a moment while I resist the strong temptation to comment on exotic dancer uniforms). Stripped down to its bare bones, this lawsuit is clear evidence of the naked truth about employment one is immune.

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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


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