In a recent change of position, the Department of Labor (“DOL”) has endorsed a new standard for determining when an unpaid intern is entitled to compensation as an employee under the Fair Labor Standards Act (“FLSA”).  We previously reported on an earlier DOL effort to tighten up the restrictions on the use of unpaid interns.  It looks like the DOL has decided to change course.

By way of further background, the United States Supreme Court has yet to address the issue, but several federal circuit and district courts have attempted to determine the proper standard to assess these situations.  Recognizing that internships are widely supported by the education community, these courts have sought to strike a balance between providing individuals with legitimate learning opportunities and the exploitation of unpaid interns.

In keeping with the rulings of the courts, the DOL, stated last Friday that “the Wage and Hour Division will update its enforcement policies to align with recent case law [and] eliminate unnecessary confusion among the regulated community…”

Accordingly, the DOL rescinded a 2010 Fact Sheet and adopted the primary beneficiary test, which considers the following factors to determine whether an intern or student is, in fact, an employee under the FLSA:

  1. The extent to which the intern and the employer clearly understand that there is no expectation of compensation. Any promise of compensation, express or implied, suggests that the intern is an employee—and vice versa.
  2. The extent to which the internship provides training that would be similar to that which would be given in an educational environment, including the clinical and other hands-on training provided by educational institutions.
  3. The extent to which the internship is tied to the intern’s formal education program by integrated coursework or the receipt of academic credit.
  4. The extent to which the internship accommodates the intern’s academic commitments by corresponding to the academic calendar.
  5. The extent to which the internship’s duration is limited to the period in which the internship provides the intern with beneficial learning.
  6. The extent to which the intern’s work complements, rather than displaces, the work of paid employees while providing significant educational benefits to the intern.
  7. The extent to which the intern and the employer understand that the internship is conducted without entitlement to a paid job at the conclusion of the internship.

No one factor is determinative and, therefore, the inquiry of whether an intern or student is an employee under the FLSA depends upon the unique circumstances of each case.  The Labor & Employment attorneys at McNees are ready to help employers with the analysis of whether the intern or the employer is the primary beneficiary of the relationship.

Typically, a drug test cannot be certified as positive until a Medical Review Officer (“MRO”) verifies the result.  For drivers subject to the Federal Motor Carrier Safety Act, Department of Transportation Regulations state that an MRO must verify as positive a confirmed test result for drugs, unless the employee presents a legitimate medical explanation for the presence of the drug in his/her system.  The employee bears the burden of establishing the legitimate medical reason for the positive test.

With the passage of state laws legalizing the use of medical marijuana, including here in Pennsylvania, many have questioned whether the use of medical marijuana, pursuant to state law, constitutes a legitimate medical reason for a positive drug test. In an updated “Medical Marijuana Notice” issued this fall, the Department of Transportation answered the question.  The DOT said “No.”

The DOT’s Notice makes it clear that marijuana, in all forms, remains illegal under federal law and the DOT expects that MROs will treat marijuana, whether used recreationally or medicinally, as illegal.  Accordingly, the Notice provides that “Medical Review Officers will not verify a drug test as negative based upon information that a physician recommended that the employee use ‘medical marijuana’ . . . It remains unacceptable for any safety‐sensitive employee subject to drug testing under the Department of Transportation’s drug testing regulations to use marijuana.”

The implications of medical marijuana use for CDL drivers is now clear.

But, what about drug tests for employees not regulated by the DOT?

The reality is that most MROs follow DOT testing guidelines for all drug tests in an effort to ensure consistency.  Accordingly, even when a non-DOT regulated employee tells the MRO that he/she is certified to use medicinal marijuana, the MRO will nonetheless certify the test as positive.  The MRO may include an external note to the employer that the employee claimed medicinal use.  However, the MRO will not seek to confirm the employee’s claim or to otherwise determine if the employee is a certified user.

The take-away is this . . . drug testing facilities will not help employers decide how to handle medical marijuana use.  A positive drug test will be a positive drug test, regardless of whether the employee is certified to use medical marijuana.  Accordingly, at the end of the day, outside of the CDL context the burden remains on the employer to decide, in accordance with its policies, how, if at all, the employee’s medicinal use impacts employment status.

Should you have any questions about your company’s drug testing procedures or your drug testing policies as the Pennsylvania Medical Marijuana Act nears full implementation, do not hesitate to contact us.

That sound you just heard was employers everywhere breathing a sigh of relief, and maybe even high-fiving.  That’s because the newly constituted National Labor Relations Board fired off several pro-employer decisions in the last week. The decisions were released in rapid succession in the days prior the expiration of the term of Board Chairman Phil Miscimarra.

As we reported just this week, the Board decided to modify the standard by which it determines whether employer policies are unlawful under the National Labor Relations Act.  That decision will provide some very welcome relief to employers who saw the Obama-era Board find just about every employer policy unlawful.  We also reported that we anticipate that the Board’s approach to social media will similarly become more fair and predictable.

The Trump-Board also made quick work of one of the Obama-Board’s most controversial decisions, Browning-Ferris, which created a new “joint employer” test.  We reported on the new expansive joint employer test adopted by the Board in Browning-Ferris, and expressed our concern regarding increased liability for employers under the new standard.  Browning-Ferris allowed for a joint employer finding, and increased liability, based on theoretical or “reserved” power/control, even if such control was never exercised.  In Hy-Brand Industrial Contractors, the Board abandoned the Browning-Ferris standard and declared that joint-employer status requires proof that the putative joint employer has actually exercised joint control over essential employment terms, rather than merely having reserved the right to exercise control.

The Board also reversed the Obama-Board’s Specialty Healthcare decision, which allowed unions to form “micro-units.”  That decision essentially required the Board to rubber stamp the union’s definition of the appropriate bargaining unit for purposes of a union election and bargaining.  This approach exposed employers to an increased risk of organizing campaigns, and the possibility of having to negotiate with several different unions.  On December 15, 2017, in PCC Structurals, Inc., the Board abandoned the Specialty Healthcare standard and returned to its prior framework for determining the scope of a bargaining unit.

Also on December 15, 2017, the Board reversed another Obama-era decision, E.I. DuPont de Nemours, Louisville Works, which had overturned 50 years of precedent.  In DuPont, the Obama-Board dramatically expanded the definition of “change” for purposes of determining whether an employer made an unlawful unilateral change to the terms and conditions of employment.  Under DuPont, an employer was found to have engaged in an unfair labor practice charge for simply continuing to do what it had done many times previously—for years or even decades. Last week, in Raytheon Network Centric Systems, the Trump-Board reversed DuPont, and announced the return to the prior standard for determining whether an employer is authorized to make changes to the terms and conditions of employment after the expiration of a collective bargaining agreement.

These decisions are certainly indicative of a return to a more employer-friendly Board.  These decisions reversed some of the more controversial, and problematic, decisions of the Obama-Board.  We are certainly hopeful these are a sign of things to come from the Board.  However, with the expiration of the term of Chairman Miscimarra, we may need to wait some time before we receive another batch of pro-employer decisions.

We have been talking about the National Labor Relations Board’s assault on Employee Handbooks, policies and rules for years now.  Frankly, precious few of these posts have contained good news for employers.  See for yourself!

Then, yesterday, in a 3-2 vote (split along party lines) a Republican majority overturned the NLRB’s 2004 Lutheran Heritage standard governing facially-neutral workplace rules, policies and handbooks.  Under the old standard, the Board could find that an employer violated the National Labor Relations Act simply by maintaining a policy that could be “reasonably construed” by an employee to prohibit the exercise of rights protected by the Act – even if the employer never applied it to restrict employee rights!  What the Board put in that “reasonably construed” category did not seem reasonable to many, many employers and, in my opinion, was extremely one-sided.

In announcing the new standard, in a decision involving the Boeing Company the majority announced that it was providing greater clarity and criticized the prior Board for invalidating “common sense rules and requirements” under the Lutheran Heritage standard.

Not only is there more clarity, there is balance.  Rather than considering only how the facially-neutral policy, rule or handbook provision could be “reasonably construed” the Board will consider two things:

  1. The nature and extent of the potential impact on employee rights protected by the NLRA and
  2. The employer’s legitimate justifications associated with the rule

The Board also categorized the rules:

  1. Category 1. Lawful rules, where the rule does not expressly prohibit or interfere with NLRA rights or the potential adverse impact on protected rights is outweighed by the employer’s justifications for the rule.  Examples offered by the Board in this category are the no-cameras in the workplace rules and the civility rules.  Remember this one on courtesy?  Please and thank you (you can say that now)!
  2. Category 2. Rules which require individualized scrutiny to determine whether any adverse impact on NLRA rights is outweighed by the employer’s legitimate justifications.
  3. Category 3. Unlawful rules that prohibit protected conduct and the impact on those employee rights is not outweighed by employer justification.  Here, is where the policies prohibiting employees from discussing wages and benefits would fall.

This is good news, for union and non-union employers alike.  Seems that the NLRB will be focusing less on policing innocuous handbook policies and, perhaps, the pendulum will begin swinging back.

In days past employees discussed and debated workplace issues around the water cooler. That sentimental past-time has long since been replaced by online social media networking and the reach of social media is stunning.

There are more than 2 billion monthly active Facebook users as of June 2017.  65% of these users on average log into Facebook daily and are considered active users. Five new profiles are created every second. The highest traffic occurs mid-week between 1-3pm. There are 328 million monthly active Twitter users, 100 million daily active tweeters and 500 million Tweets sent every day.

Disgruntled employees now use social media to speak out about employers and co-workers, using Facebook, Twitter, blogs and the like. An on-line attack has the potential to cause harm to the good-will of companies, and negatively impact the morale and reputation of employees.

The National Labor Relations Board (NLRB) regulates the employer-employee relations of private union and non-union workplaces.  In recent years the Board has consistently acted to protect from discipline unhappy employees who resort to social media and has waged an active war with employers to expand the rights of employees to use their employers’ private email systems.

As a result, many employers are asking fundamental questions. Do employees have a right to use social media sites while at work? Can I monitor employees’ social media activity? Do I need a social media policy?

The statistics vary but somewhere between 25% to 50% of companies have a social media policy in place. About 30% have policies that delineate how employees must present themselves when posting on the internet; nonetheless, 75% of the employees of these companies use social media regardless of the company’s policy.

The National Labor Relations Act gives employees the right to act together to address wages, hours and terms and conditions of employment. This is referred to as “protected, concerted activity.” When an employee posts a complaint on Facebook or Twitter about a company policy, such as vacation or flexible work hours, or complains about a work unit’s supervision, the employee may be engaging in protected activity that the NLRB considers to be beyond the reach of disciplinary action.

What are some of the factors that employers need to consider?

  1. Was the post for purely personal reasons?
  2. Did other employees join in or “like” the post?
  3. Did the post concern work-related issues?
  4. Was the post so disloyal or egregious so as to lose protected status?

While an employee may post a comment or observation a company considers disrespectful or objectionable that may qualify as protected, concerted activity, there are recognized limitations.  One such area includes proprietary and confidential information, and trade secrets.  Another area that is off limits includes comments about co-workers that are based on race, age, religion and other unlawful activity, such as sexual harassment.

However, in the absence of evidence of these off-limits areas, comments that companies have considered disrespectful, damaging to the company’s reputation, inappropriate in violation of company policies, or even as flat out false have been found lawful and protected.  And, to add insult to injury, the NLRB also has held the underlying company handbook personnel policies to be illegal.  As a result, employee discipline has been overturned, the employee reinstated with back pay and other lost benefits, and the company ordered to revise the underlying policy.

Now, some relief may be on the horizon for 2018 and beyond.  On December 1, 2017, the new NLRB General Counsel issued a memorandum to field offices directing them to submit cases involving several of these contentious social media, handbook policy and use of company email issues to the Division of Advice for further guidance.  This action acts to essentially freeze regional offices from moving new cases forward.

In the meantime, how does an employer navigate the murky social media waters?

  1. Notify employees that internet use will be monitored and that there is no expectation of privacy in the use of the company’s email and internet system.
  2. Implement a social media policy and train employees on its content.
  3. Designate a person to be responsible for implementing and administering these steps, and monitoring compliance.
  4. Implement a procedure to report policy violations.
  5. Prohibit the use of social media networking during working time.
  6. Review underlying policies (confidentiality, non-disparagement, harassment, etc.) to assure the policies do not infringe on concerted, protected activity.

Last year, OSHA issued a new electronic reporting rule that requires employers with more than 250 employees in industries covered by the OSHA recordkeeping regulations, as well as employers with 20-249 employees in designated “high-risk industries” (including manufacturing, construction, and many healthcare establishments), to electronically submit injury and illness data from their OSHA 300 logs and related forms. Much of the information electronically will be made available to the public on OSHA’s website because, in OSHA’s view, “behavioral economics tells us that making information publicly available will ‘nudge’ employers to focus on safety.”

The original July 1, 2017 deadline by which covered employers were required to submit data from their Form 300A Annual Summary for 2016 was previously extended by OSHA in order to “provide the new administration the opportunity to review the new electronic reporting requirements prior to their implementation and allow affected entities sufficient time to familiarize themselves with the electronic reporting system.”   The deadline is now December 15, 2017. Accordingly, covered employers must log onto OSHA’s Injury Tracking Application (ITA) and submit their 2016 OSHA Form 300A information electronically on or before December 15, 2017.

Whether OSHA will maintain the future electronic reporting requirements under the new rule remains to be seen. A recent OSHA press release indicates that “OSHA is currently reviewing the other provisions of its final rule to Improve Tracking of Workplace Injuries and Illnesses, and intends to publish a notice of proposed rulemaking to reconsider, revise, or remove portions of that rule in 2018.” Considering the Trump administration’s record of scaling back Obama era government regulations, it would not be a surprise to see a change here as well.

Stay tuned for additional updates in 2018 …

Last November, we explained the decision in the case of U.S. Equal Employment Opportunity Commission v. Scott Medical Health Center, P.C., from the U.S. District Court for the Western District of Pennsylvania.  There, the court concluded that Title VII of the Civil Rights Act of 1964 prohibits discrimination and harassment based on sexual orientation.  Our previous post on this case can be found here.

To recap, the Equal Employment Opportunity Commission’s (“EEOC”) filed the lawsuit on behalf of a gay, male former employee of Scott Medical, alleging that his supervisor subjected him to anti-gay epithets and a hostile work environment based on his sexual orientation.  The court refused to dismiss the case because, in the words of U.S. District Judge Cathy Bissoon, “discrimination on the basis of sexual orientation is a subset of sexual stereotyping and thus covered by Title VII’s prohibitions on discrimination ‘because of sex’.”

On September 25, 2017, the court entered a default judgment against Scott Medical on the issue of liability.  The court found that the company had committed an intentional violation of Title VII.  This finding was based on the fact that Scott Medical’s Chief Executive Officer was aware of the supervisor’s harassing actions and refused to take any action to stop the conduct or correct the hostile work environment.

On November 16, 2017, after a trial on issue of damages, Judge Bissoon ordered Scott Medical to pay the employee $5,500.43 in back pay and prejudgment interest.  More importantly, she also ordered Scott Medical to pay the statutory maximum amount of $50,000 as compensatory and punitive damages.  If not for the statutory cap on such damages, Judge Bissoon opined that “punitive damages in the amount of $75,000 would be warranted by the evidence” in this case.

Notably, the supporting evidence cited by the court included the fact that Scott Medical failed to train the harassing supervisor on its anti-harassment policy.  In fact, Scott Medical could not identify anyone who would have provided such training to any of its supervisors.  Similarly, the former employee testified that he never received a copy of the Company’s anti-harassment policy and was never trained about harassment in the workplace.

There are several clear takeaways from this case.  First, as we explained here, regular and effective anti-harassment training is an essential part of preventing harassment in any organization.  This case provides 55,000 reasons to ensure that such training is provided to supervisors and managers, as well as all other employees.

The second takeaway is to revisit your organization’s Equal Employment Opportunity and Anti-Harassment policies, and consider adding sexual orientation as a protected trait.  As you update your policies, keep in mind the importance of responding promptly and appropriately when complaints are raised about harassment – including harassment based on sexual orientation.  It also may be a good time to update your anti-harassment training to specifically address issues of discrimination and harassment based on sexual orientation.

There also may be more to come with the Scott Medical case.  Now that a final judgment has been entered, an appeal to the Third Circuit Court of Appeals may be forthcoming.  If the case is appealed, the Third Circuit likely will be forced to reconsider several prior decisions in which it found that sexual orientation was not protected under Title VII.  We will continue to provide updates as developments in this area occur.

In September, President Trump nominated management-side labor and employment lawyer Peter Robb to replace Richard Griffin, whose term expired on November 4, 2017, as general counsel to the National Labor Relations Board.  Yesterday, the United States Senate confirmed Robb’s appointment to the position.

As general counsel, Robb will play an important role at the NLRB.  He is now responsible for overseeing the Board’s regional offices and legal staff nationwide.  He also has broad discretion to investigate and prosecute unfair labor practice cases that are filed with the Board.

Robb’s confirmation solidifies Republican control of the Board, which already consisted of three Republican and two Democrat Members.  With Robb’s confirmation complete, many expect the Board to reverse significant pro-labor decisions rendered during the Obama-era.  It should be noted, however, that Republican Board Member and Acting Chairman Philip Miscimarra’s term ends on December 16, 2017, leaving another vacancy for President Trump to fill.

As always, we will keep an eye on developments at the National Labor Relations Board, reporting significant decisions and events here on our blog.

An ever-increasing number of employers are sponsoring wellness incentives as a means of encouraging employees to developing healthy habits. In turn, employers gain healthier, more productive work forces.  Wellness incentive programs aren’t without their risks, however.  In this podcast, Denise Elliott discusses whether employees are covered by workers’ compensation benefits for injuries sustained while participating in an employer-sponsored wellness program.