Most state workers in Utah are shifting to 4-day week with announcement of the ‘Working 4 Utah’ initiative, extending state government service hours from 7 a.m. to 6 p.m., Monday through Thursday beginning the first week of August. State administrative offices will be closed on Fridays but essential public services will remain open that already run on extended hours and during the weekends. Utah Governor Jon Huntsman stated that

As we go forward with this initiative, we will conserve energy, save money, improve our air quality, and enhance customer service…. We live in a dynamic, ever-changing environment, and it’s crucial that we take a serious look at how we can adapt and maintain our state’s unparalleled quality of life.

Working 4 Utah cost saving analysis examined the impact of moving from five 8-hour days to four 10-hour days in terms of Reduction in Energy use for Government Buildings; Fuel Savings from less Commuting; Employee Financial Savings; and Emission Reductions.

Workforce Management notes that the Gas Price Could Revolutionize U.S. Workplace.  We have posted on Energy Expenses And Gas Prices Motivate Employers To Move To Four Day Workweek: What Are The Legal Issues? and FLSA causes Global Warming:  Sixteen other Reasons to Consider a 4-day Work Week.   Several Pennsylvania Counties and municipalities are mulling four day workweeks, including Berks County, Centre County, York County, and BEA School District.  But, Warren County has reportedly rejected the idea.  Give us your thoughts on the subject:

 

“Small Employer” minimum wage increases to $7.15 per hour effective July 1, 2008 

All employers in Pennsylvania must pay the state’s minimum wage of $7.15 per hour based on the expiration of the Small Employer exemption. Previously, an employer who had an employee complement composed of the equivalent of 10 or less full-time employees had a lower minimum wage rate of $6.65 per hour until July 1, 2008.

Pennsylvania’s Training Wage Increases to $6.55 per hour effective July 24, 2008

Pennsylvania’s training wages is scheduled to increase from $5.85 to $6.55 effective July 24, 2008. The training wage is no longer allowed after July 23, 2009. A 60-day training wage may be paid to employees under 20 years old effective January 1, 2007. This wage matches the current federal minimum wage. Eligible employees may be paid the training wage up to the day before the employee’s 20th birthday. On and after the employee’s 20th birthday, pay must be raised to the regular Pennsylvania minimum wage even if the 60-day period has not expired.

The 60-day period starts on the first day of work. The 60-day period is counted as consecutive days on the calendar, not as days worked or business days. A break in employment (e.g. vacation, school year, etc.) does not affect the calculation of the 60-day period of eligibility and does not allow the employer to “restart” the 60-day period.

A youth under 20 may be paid the training wage for up to 60 consecutive calendar days after initial employment with any employer, not just the first employer. The fact that an eligible youth may be employed at the same time by more than one employer (unrelated to each other) does not affect either employer’s right to pay the training wage.   An employee may be “initially employed” only once by any one employer even if there are breaks in employment.

Employers must notify these employees at the time of hire of this wage and their right to receive the regular Pennsylvania minimum wage after 60 calendar days. Current employees may not be displaced, have their hours reduced or have their wages or employment benefits reduced to allow hiring of persons eligible for the training wage. Employers do not have to meet any training requirements to pay an eligible youth this training wage.

Pennsylvania’s Mandatory Minimum Wage Poster

FAQ on Pennsylvania Minimum Wage

On June 26, 2008, the United States Supreme Court issued a landmark decision confirming that the Second Amendment of the United States Constitution protects an individual’s right to keep and bear firearms. In District of Columbia v. Heller, the Supreme Court interpreted the language of the Second Amendment for the first time in nearly 70 years and struck down the District’s 32-year-old ban on handguns and trigger-lock requirements for other firearms.

This decision already has generated significant national attention and debate. Although the Court formally recognized the individual right to bear arms in Heller, the majority’s decision does not define the scope of that right. Thus, the full meaning and ramifications of this decision will be unclear for many years to come. 

That said, we can state what the Heller decision does not mean. From an employment law perspective, the Heller decision should have no effect on an employer’s ability to promulgate weapons or workplace violence policies that ban handguns or other types of weapons from its facilities. Constitutional protections are not applicable to private sector employers, absent some form of state action. For the same reason that an employee may not rely on the free speech protections of the First Amendment as a defense to discipline issued by a private sector employer, an employee cannot rely on Heller and the Second Amendment as a defense to a violation of an employer’s weapons or workplace violence policy. As for public sector employers, Justice Scalia, writing for the Court, expressly noted that the right recognized in Heller "is not unlimited" and that the decision should not "cast doubt" on restrictions barring firearms near schools or in government buildings. If the government may lawfully prohibit the carrying of handguns in government buildings, public sector employers also may have reasonable employment policies regarding handguns and other weapons. 

Thus, employers can enjoy the national debate and discussion following the Heller decision while knowing that it should not impact their employment policies.  The "RIght to bear Guns at Work" was the subject of a post on CNN’s Small Business noting that some state laws provide for a right of employees to bear arms in workplace settings.  Pennsylvania has no law that creates a right for employees to bring firearms to work.

Sometimes a wait and see approach is the right call when it comes to proposed legislation, but not for nonunion employers facing the possible passage of the Employee Free Choice Act (EFCA). EFCA will radically change the way unions organize employers by eliminating the “campaign” phase and secret ballot election that have been the hallmark of industrial relations since the inception of the NLRA in 1935.

Under EFCA, a union can organize an employer based simply on a majority card showing. The following actions will place an employer in much better position should EFCA become law:

  • Educate your managers and supervisors now, not only on the card-signing process itself, but more broadly as to why unionization may be anachronistic in the 21st Century workplace.
  • Audit your current HR practices and make improvements before the union is on the scene (as it may be an unfair labor practice to do so after the union begins contacting your employees).
  • Make sure your employees have a recognized channel for bringing their concerns to management, a way they can "let off steam." (If not, your claim later that they don’t need a union to represent them may fall on deaf ears.)
  • Make sure your supervisors are consistently administering disciplinary policies in a non-discriminatory equitable fashion.
  • Train your managers and supervisors on what they can and cannot say during an organizing campaign, and maybe more importantly, what they should be saying if the union shows up.
  • Review your policies on solicitation, distribution of literature, bulletin board postings, and employee use of e-mail, while necessary changes can still be made. Again, if you wait until the union is on the scene to tweak, you will be committing an unfair labor practice.
  • Review your wage and benefit structures. If you’re not competitive in your industry or geographical area, the union will seek to exploit this in suggesting to your employees they need union representation.

Most experts believe EFCA is likely to be enacted in 2009.  Presidential candidate John McCain opposes EFCA and submitted a statement to the Congressional Record on June 26, 2007 in which he stated as follows:

I am strongly opposed to H.R. 800, the so-called “Employee Free Choice Act of 2007.” Not only is the bill’s title deceptive, the enactment of such an ill-conceived legislative measure would be a gross deception to the hard working Americans who would fall victim to it.

Barak Obama has repeatedly advocated its passage and has the following position statement on his website:

The current process for organizing a workplace denies too many workers the ability to exercise their right to do so. The Employee Free Choice Act will allow workers to form a union through majority sign up and card checks, and strengthen penalties for those employers who are in violation. The choice to organize should be left up to workers and workers alone. It should be their free choice.

Organized labor will be pushing hard for EFCA, and if there is a Democratic Administration and Congress, passage of EFCA would be a virtual certainty. As noted by Kris Dunn this is The Hidden Career Killer for HR Pros unless you act now.

HR professionals are reminded of their workplaces’ vulnerabilities every time an episode of workplace violence is reported in the media like this morning’s headline “6 dead in plastics factory shooting rampage.”  The scope of the problem set out in statistics. There were 5734 workplace fatalities reported to OSHA (2005 is the last year statistics are available). Assaults and Violent Acts accounted for 792 workplace fatalities.

Media accounts typically report about the “warning signs” that were missed and speculate on how the incident may have been prevented. There are, of course, psychological tests and assessment tools that are predictive of violent behavior, but there are significant legal restrictions on their use. Assessments that are not "medical tests" may be used on a pre-employment basis, but should not be used as the principal reason for a hiring or promotion decision.

There is no profile of a potential workplace violence perpetrator; however, there are traits when coupled with at risk situations that increase the likelihood of violent behavior. Sheryl and Mark Grimm of the Workplace Violence Headquarters have developed a Formula for Workplace Violence that includes a list of traits as follows:

  • Previous history of violence, toward the vulnerable, e.g., women, children, animals
  • Loner, withdrawn; feels nobody listens to him; views change with fear
  • Emotional problems, e.g., substance abuse, depression, low self-esteem
  • Career Frustration, either significant tenure on the same job of migratory job history
  • Antagonistic relationships with others
  • Some type of obsession, e.g., weapons, other acts of violence, romantic/sexual, zealot (political, religious, racial), the job itself, neatness and order.

There is a major legal distinction made between an employer’s treatment of an applicant with a potentially violent personality and addressing employee conduct that expresses violent behavior. The EEOC has stated that its position on the distinction between perception and conduction in its  Enforcement Guidance for Individuals with Psychiatric Disabilities :

34. When can an employer refuse to hire someone based on his/her history of violence or threats of violence?

An employer may refuse to hire someone based on his/her history of violence or threats of violence if it can show that the individual poses a direct threat. A determination of "direct threat" must be based on an individualized assessment of the individual’s present ability to safely perform the functions of the job, considering the most current medical knowledge and/or the best available objective evidence. To find that an individual with a psychiatric disability poses a direct threat, the employer must identify the specific behavior on the part of the individual that would pose the direct threat. This includes an assessment of the likelihood and imminence of future violence.

30. May an employer discipline an individual with a disability for violating a workplace conduct standard if the misconduct resulted from a disability?

Yes, provided that the workplace conduct standard is job-related for the position in question and is consistent with business necessity. For example, nothing in the ADA prevents an employer from maintaining a workplace free of violence or threats of violence, or from disciplining an employee who steals or destroys property. Thus, an employer may discipline an employee with a disability for engaging in such misconduct if it would impose the same discipline on an employee without a disability. Other conduct standards, however, may not be job-related for the position in question and consistent with business necessity. If they are not, imposing discipline under them could violate the ADA.

OSHA’s General Duty Clause requires employers to “furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees.” OSHA provides some resources to help employers meet this requirement.

Given the legal limitations confronting employers in their efforts to provide a safe workplace, the following are some suggestions in development of a Violence Program:

  • Establish and communicate a written violence policy
  • Consider pre-employment assessments and background checks
  • Establish an Employee Assistance Program
  • Train supervisors to recognize warning signs of employee violence
  • Recognize "at risk" situations like employee discipline or discharge and plan accordingly
  • Consider professional evaluations of at-risk employees based on objective signs of workplace problems
  • Assess workplace security measures
  • Develop and Communicate a Disaster Management Plan

The OFCCP reports a record $51.7 million recovered for 22,251 workers. Of the recovery, 98% was collected for cases of systemic discrimination in the application process because of unlawful employment policy or practice according to a published account. Much of the monetary recovery came from the 14 cases of systemic discrimination referred to litigation with the DOL’s lawyers.

Government contractors are selected for audit in several ways including the use of a mathematical model that predicts the likelihood of a finding of systemic discrimination. The model analyzes data from five years of OFCCP compliance evaluations to formally identify and characterize relationships between reported EEO-1 workforce profiles and findings of discrimination. The OFCCP publishes compliance lists for one year audit cycles beginning in October of each year.

We have been involved in many of these style OFCCP audits and the approach is the same. The audit is triggered by an anomaly in a business’ EO Survey which shows a statistical disparity in either hires or terminations. For example, the percentage of minority applicants differs by more than 80% from the percentage of minorities hired (the four-fifths rule). The investigation into the disparity in the hiring process follows the road map set out in the OFCCP’s Compliance Manual as follows:

  • Summarizing the hiring process by obtaining an employer’s summary
  • Establishing the minimum objective criteria for the position.
  • Evaluating the Pass/Fail Points for disparate impact (i.e., when does an applicant move to the next step of the process).
  • Evaluating both the objective and subjective criteria for uniform application to all applicants and for business relatedness.
  • Evaluating specific safeguards as to the application of selection criteria including how well each is documented for each applicant.
  • Measuring statistical disparity by Impact Ratio Analysis (IRA) of each step and criteria.

There are many problems with the OFCCP’s investigatory process, a few of which are described as follows:

1.    The OFCCP loathes subjective hiring criteria. I had a client who required that its customer service candidates be "personable and friendly". The OFCCP started out with the position that this was not a "job-related" criteria. When that didn’t fly with its own legal department, the OFCCP interviewed every hiring manager and asked them to define how it applied the "personable and friendly criteria". When the hiring manager responses weren’t exactly the same, the OFCCP found adverse impact because the hiring procedures weren’t uniformly applied to all applicants.

2.    The OFCCP’s standard for adequate record keeping of each hiring decision is extremely high and it finds that inadequate records are a form of systemic discrimination.

3.    Finding adverse impact based on the four-fifths rule is a joke in terms of its lack of statistical significance. The rule has its origin in the EEOC’s Uniform Guidelines on Employee Selection Procedures. However, knowing that the OFCCP uses this flawed measure makes it all the more important to use this measuring stick when self-assessing your employment practices.

Once the OFCCP makes a finding of a prima facie case of pattern and practice discrimination, it will presume that all members of the class are victims of discrimination and assess liability against the contractor.   The employer can only argue about who is eligible for an award and how much. This is where an employer must decide to dig in its heals and litigate or settle.

A settlement with the OFCCP for systemic discrimination in the hiring process will include back pay plus interest and job offers to the affected class, internal mandated and OFCCP approved training, follow up reporting to the OFCCP and publicity in the form of an OFCCP Press Release.

On June 19, 2008, the United States Supreme Court is its decision in Meacham v. Knolls Atomic Power Laboratory holding that an employer defending a disparate impact claim under the Age Discrimination in Employment Act (ADEA) bears the burden of persuading the factfinder that its use of "reasonable factors other than age" (RFOA) was reasonable.

As part of a reduction in force, Knolls developed a review system to determine which managers to lay off. Under Knoll’s system, managers were scored on their "performance," "flexibility," and "critical skills." Managers were also given points based on years of service. Based on its review system, Knoll’s terminated 31 managers, 30 of whom were over the age of 40. 

Twenty-eight of the terminated managers filed suit in the District Court for the Northern District of New York alleging both disparate treatment and disparate impact claims under the ADEA. At trial, the plaintiffs relied on a statistical expert’s testimony that the result of Knoll’s review system was so skewed that it could not have occurred by chance. The jury found for the plaintiffs on the disparate impact claim, but not on the disparate treatment claim. Knolls appealed the decision to the Second Circuit Court of Appeals.

Following the Supreme Court’s decision in Smith v. Jackson, the Second Circuit ruled in favor of Knolls and vacated the judgment. Meacham appealed the case to the Supreme Court citing the Ninth Circuit Court of Appeals decision in Criswell v. Western Airlines, Inc., which placed the burden on the plaintiff to prove that the employer’s RFOA was unreasonable. The Supreme Court agreed to decide the issue, and vacated the judgment of the Second Circuit.   

In its decision, the Supreme Court focused on the fact that the language of the RFOA exemption appears alongside the exemption for bona fide occupational qualifications (BFOQ). These exemptions provide an affirmative defense "where age is a bona fide occupational qualification reasonably necessary to the normal operation of the particular business, or where the differentiation is based on reasonable factors other than age." 29 U.S.C. § 623(f). Based on how Congress drafted the RFOA and BFOQ exemptions, the Court concluded that the legislature intended the two exemptions to be treated the same. As the BFOQ exemption has always been treated as an affirmative defense, the Court concluded that the RFOA exemption should also be treated as an affirmative defense. As such, the Court ruled that the employer has the burden of persuading the factfinder that its RFOA was reasonable.    

While the Court did reiterate that a plaintiff cannot establish an ADEA disparate impact claim merely by pointing to a generalized policy that has caused a disparate impact, the Court did admit that this decision "makes it harder and costlier to defend than if employers merely bore the burden of production; nor [did the Court] doubt that this [decision] will sometimes affect the way employers do business with their employees."

On June 19, 2008, the United States Supreme Court issued four employment-related decisions that are briefly summarized as follows:

Meacham v. Knolls Atomic Power Laboratory:  The government ordered its contractor to reduce its workforce. The contractor had its managers select employees for layoff based on factors including performance, flexibility, critical skills and seniority. The resulting reduction in force netted 31 employees, 30 of which were over 40. Several laid off employees sued claiming the neutral factors used for layoff had a disparate impact on older workers.

The Court noted that the employees in a disparate impact case must isolate and identify specific employment practices that are allegedly responsible for the statistical disparity disfavoring older workers. The employer must prove that the neutral factors constitute “reasonable factors other than age”. Reasonableness differs from business necessity.

Chamber of Commerce v. Brown:  The Court struck down a California law that prohibited employers who receive state funding from using those funds to “assist, promote, or deter union organizing.” The Court held that the NLRA preempts state laws that attempt to regulate areas that the NLRA protects or prohibits.

Kentucky Retirement System v. EEOC:  Kentucky’s pension program imputed additional years of service for workers in “hazardous positions” who became disabled so as to credit them with service to reach “normal retirement” under the plan. An employee who worked past normal retirement age and then became disabled challenged the plan on the basis of age discrimination. He argued that the disability pension calculation disadvantaged older workers based on their aged.

The Court noted the distinction between “age” and “pension status”. When an employer adopts a pension plan that includes age as a factor, and that employer treats employees differently based on pension status, a plaintiff must prove that the differential treatment was “actually motivated” by age and not pension status to prevail under the ADEA.

Metropolitan Life Insurance Co. v. Green:   A life insurance company was the administrator of an employer’s long-term disability plan so it decided an employee’s eligibility for benefits and paid the claim out of its pocket. The insurer determined that an employee was not eligible for benefits and the employee appealed.

The Court analyzed the standard of review of a plan administrator’s denial of benefits under ERISA when the administrator is both the decision maker and the payer of benefits. In such a situation, the administrator has a conflict of interest, which a court may consider as a factor in accessing whether the decision is an abuse of its discretion under the plan. The administrator’s decision is entitled to “deference” and the court may not substitute its judgment for that of the administrator; however, it may consider the conflict as part of its assessment.

Hat tip to Connecticut for being faster by a nose.

The Amendment to Executive Order 12989 has government contractors and subcontractors scrambling to evaluate their legal obligations. Details remain sketchy, but the following information may help prepare a compliance strategy:

What is the Effective Date for Using E-Verify?

Employers have no immediate requirement to start using E-Verify. According to a SHRM news report, the deadline for federal contractors to sign up for E-Verify “still needs to be determined” and will be made public through the standard government regulation process, U.S. Citizen and Immigration Services (USCIS) Acting Director Jonathan Scharfen said, following his testimony June 10, 2008, on E-Verify before the House Immigration, Citizenship, Refugees, Border Security and International Law Committee. Once a deadline has been determined, E-Verify will be able to handle the roughly 200,000 contractors who will have to sign up or risk losing their federal contracts, he said.

Which Employers will be Covered?

The Amendment to E.O. 12989 requires E-Verify use for (i) all persons hired during the contract term by the contractor to perform employment duties within the United States; and (ii) all persons assigned by the contractor to perform work within the United States on the Federal contract.The original E.O. 12989 set forth the parameters of the order by referencing the debarment provisions of the Federal Acquisition Regulations. Based on the combination of references it appears that the new E-Verify system will be applicable to the employees of all first tier contractors (and their affiliates) and the employees of sub-contractors working on the government contract. It is unclear whether E-Verify applies to existing contracts and/or existing employees.

Are there Alternatives to E-Verify?

An alternate program called New Employee Verification Act (NEVA) (H.R. 5515), has been introduced by Rep. Sam Johnson, R-Texas. NEVA would transform the current paper-based employment verification process by requiring employers to participate in one of two electronic employment verification systems. Employers would enroll through their state’s existing “new hire” reporting program which was originally designed to enhance child support enforcement. The new hire-reporting program is an electronic portal already used by 90 percent of U.S. employers. Commentators have noted “serious flaws” in this program too.

Have the Accuracy Issues with E-Verify been Resolved?

The DHS report “Debunking the E-Verify Error Rate” touting the accuracy of the E-verify System is based on 1000 queries conducted by an independent reviewer noted automatic confirmation of 942 (94.2%) of the sample queries. Five (.5%) of applicants were able to resolve the mismatch by correcting information with the Social Security Administration. The balance of 52 (5.2%) applicants could not be hired because of unconfirmed information. There is no analysis as to whether the rejected applicants where illegal workers or erroneous rejections.

GAO Report issued on June 10, 2008 entitled “E-Verification: Challenges Exist in the Implementing the Mandatory Electronic Employment Verification System” evaluates the accuracy of E-Verify as follows:

According to USCIS, under the current voluntary program the majority of E-Verify queries entered by employers–about 92 percent–confirm within seconds that the employee is authorized to work. About 7 percent of the queries cannot be immediately confirmed as work authorized by SSA, and about 1 percent cannot be immediately confirmed as work authorized by USCIS because the employee information queried through the program does not match information in SSA or DHS databases. With regard to SSA tentative nonconfirmations, USCIS and SSA officials told us that the majority of erroneous tentative nonconfirmations occur because employees’ citizenship or other information, such as name changes, is not up to date in the SSA database, generally because individuals have not contacted SSA to update their information when changes occurred.

Should a Contractor get a “Head Start” by signing up for E-Verify in Advance of the Effective Date?

A wait and see approach may still be the best play as the uncertainties of the effective date and coverage are resolved by regulations. In any event, employers should carefully considered a compliance strategy based on yet unresolved contingencies:

  • Scope of Operations covered by E-Verify
  • Whether Verification applies to existing employees or just new hires
  • Effect on Hiring and Retention of Workforce
  • Centralization of Hiring Process
  • Communication with No-Match Employees and/or Applicants
  • Assistance to Employees in correcting No-Match
  • Appreciating the Scope of the No-Match Safeharbor and IRCA’s Anti-discrimination protections

Governor Edward G. Rendell signed into law the Clean Indoor Air Act, announcing that the Act “will protect Pennsylvanians from the deadly health effects of secondhand smoke by prohibiting smoking in most public places, including restaurants, workplaces and a portion of casino floors.” The new law is effective September 12, 2008.

The Act covers the indoor areas of all “workplaces” which includes all places of employment and those where volunteer activity is conducted. It seems the all too familiar outdoor smoking areas at workplaces survived the Act’s prohibitions, unless the owner of the public place prohibits smoking on the entire property (indoor and outdoor), which is expressly allowed under the legislation. Signage is required designating both smoking and nonsmoking areas.

The Act contains exemptions to smoking prohibitions for rooms within lodging establishments, tobacco sellers and manufacturers, long-term care facilities, private clubs, and drinking establishments. The Act does not expressly address issues created when an exempt area is also a workplace, although a common sense reading would allow smoking in exempt areas even if work were performed there. Perhaps the Department of Health will clarify this technical inconsistency. The Act has anti-retaliation provisions that state “a person may not discharge an employee, refuse to hire and applicant for employment or retaliate against an employee because that individual exercises a right to a smoke-free environment required under this act.” 

Penalties for violations of the act range from $250 for the first offense escalating to $1000 for subsequent offenses. An affirmative defense is provided for good faith efforts to prohibit smoking. Employers must comply with the Act by posting a sign containing the international no smoking symbol and enforcing no smoking policies including relegating smoking activities to designated outdoor areas.

UPDATES: Pennsylvania Workplaces Must be Smoke-free by September 11, 2008 (includes action steps for compliance with the law;  Department of Health Issues Guidance for Employer Compliance with the Pennsylvania Clean Indoor Air Act