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September 11, 2014

Think Before Documenting That!

Filed under: Discrimination,Legal Issues,Title VII — Tags: 8:20 pm

I was relatively new to the human resources scene in the early/mid 90s, and I watched as my manager could have shrieked in horror, (Does an audible gasp count?), at the note a hiring manager wrote on an employment application.  The applicant’s first name was Ebony.  Noted.  But, that manager in her efforts (giving her the benefit of the doubt) to remember the applicant wrote quite simply, “black girl.” Those two words, just screamed “discrimination” at my manager and she immediately took control of the situation.

Most HR professionals realize the implications of making descriptive notes on applications can be a double-edged sword.  Nearly everything is fair game to a plaintiff’s attorney, even the notes we make to ourselves about who was who in our candidate pool.  However, I learned that very day, in those very tense moments, that it is much better to write, “navy blue suit” as opposed to describing someone’s skin color.  Better yet, write nothing at all!

Such was true for a manager involved in a recent case out of Texas in which two newly hired workers complained their wages were lower than other workers with the same or very similar jobs.   After about three weeks of work for the company they were terminated on a trumped up reason.

The manager documented their personnel files after receiving a notice from the Equal Employment Opportunity Commission granting the two terminated employees the right to sue.  He wrote:

“Please note he is not eligible for rehire ever.  Tried to sue us.  Simply tell him, ‘sorry but we have nothing for you at this time.  Please try again.  Have a nice day.’  Not for rehire.  Per Ben G.”

Those words were enough to cause the Texas Court of Appeals to find for the two workers on the charges of retaliation and malice.  They were awarded damages as well.  (You can read the case here.)

So in every situation from hiring to firing – be careful and think before you document that!


Source:  Meyer, Eric B.  “The Problem With Putting ‘Do Not Hire’ Notes in Personnel Files.”  Article available here and here.



August 14, 2014

If It Looks Like Retaliation – It Probably Is!

Filed under: Discrimination,Legal Issues,Title VII — Tags: 7:39 am

An interesting case from Salt Lake County, Utah, recently caught my attention.  The county was facing a sexual harassment claim.  The complainant’s coworker, Michael Barrett, helped her successfully win her case.  Barrett is a hero, right?  Wrong.  Shortly after assisting his coworker, Barrett was demoted.  Now, if that wasn’t enough to scream, “Retaliation!” the county hired a replacement for his previously held position.

Barrett, now knowing his way around the justice system, filed suit against the county alleging his demotion was a retaliatory action and violated Title VII of the Civil Rights Act of 1964.  The county argued that he was poor worker.  However, Barrett successfully presented evidence of his 14 years with the county having received multiple promotions and positive performance reviews – until that fateful moment when he began helping his distressed coworker.  The court ordered that Barrett be paid the same amount of pay in his new, demoted position that he had received in the old job, and that the newly hired, innocent employee not be removed from Barrett’s old position.  The county, of course, appealed.

The 10th Circuit Court of Appeals, whose rulings govern Utah employers, upheld the previous court’s decision.  They agreed that Barrett had presented sufficient evidence to demonstrate that he had been retaliated against by the county.  The 10th Circuit also agreed that the trial court had ordered an appropriate remedy to Barrett and the new hire.

Notable in this case was the supervisor’s actions. reported that, “The disciplinary proceedings that resulted in his demotion began almost immediately after his ‘supervisor learned of his involvement in the sexual harassment complaint.’”  Interestingly enough, other witnesses that were involved in the case were disciplined and the supervisor who administered some of the disciplinary actions lost the records for them.  Convenient.

Employers should be aware that employees have the right to complain about illegal treatment in the workplace.  They have the right to assist other employees, as witnesses, in a claim.  Any adverse employment actions against a complainant or a witness should be taken with extreme caution (and experienced legal counsel) so the action doesn’t even appear to be retaliatory.


Source:  www.hrlaws.comUtah – Employment Law Letter


December 20, 2013

HR Fact Friday: Recent Settlements and Lawsuits

Filed under: Unions/NLRB — Tags: , 6:00 am

The United States Occupational Safety and Health Administration (OSHA) has ordered a North Carolina trucking company to reinstate three former employees and pay them $1 million in damages for alleged retaliation. OSHA has concluded that the truckers were whistleblowers who were fired after reporting safety concerns. A national produce company has agreed to pay $1.2 million to settle claims that workers on the company’s Hawaiian farms were subjected to poor housing, insufficient food, low wages and deportation threats. The settlement resulted from claims of race and national origin discrimination filed with the Equal Employment Opportunity Commission (EEOC). The Federal Fifth Circuit Court of Appeals recently rejected a ruling from the National Labor Relations Board (NLRB) ruling that arbitration agreements barring employees from pursuing class or collective claims violate federal labor law. The NLRB had held that such collective claims were protected by the employees’ federal rights to engage in concerted activity.


September 21, 2012

HR Fact Friday: Investigation Confidentiality Instructions Questioned

Filed under: EEO,Employment Law,Legal Issues — Tags: , , , 6:00 am

The National Labor Relations Board (NLRB) and the Equal Employment Opportunity Commission (EEOC) have issued separate statements calling into question the legality of blanket employer instructions given to employees to keep workplace investigations confidential. The NLRB recently decided that an employer’s complaint policy that required an employee not to talk with co-workers about his/her workplace complaints during an investigation violated the National Labor Relations Act (NLRA) rule allowing employees to discuss workplace conditions with each other. This ruling applies in both union and non-union settings.

The NLRB said that rather than using a general blanket rule, an employer should only give such a confidentiality instruction in specific and individual cases where there is an established need to protect witnesses, avoid spoliation of evidence or fabrication of testimony or to prevent a cover-up. Employers probably should document specific findings of these possible problems before giving any confidentiality instructions and may want to update their policies to explain when such confidentiality instructions will be given. The EEOC’s critique of confidentiality instructions came in the form of a recent letter from a field office sent to an employer asserting that its confidentiality policy violated employee rights.

One of the issues the EEOC seemed concerned about was that the employer’s confidentiality policy was so broad it might be interpreted by employees as preventing them from going to the EEOC with complaints. Unlike the NLRB ruling, the EEOC letter does not have the force of agency law yet. Certainly, an employer should make sure that management and/or HR are not breaching the confidentiality of an employee’s complaint. However, the NLRB ruling alone should give employers pause before issuing confidentiality instructions to individual employees themselves. Various commentators are opining that it still may be safe to ask employees not to discuss the actual investigative interviews, given that this instruction still allows employees to discuss the underlying conduct with co-workers. This is probably one of those situations where the company’s employment lawyer should be consulted before a confidentiality instruction is given. It also is likely we may get further clarifications from the NLRB and/or the EEOC on this particular issue.


February 5, 2010

HR Fact Friday: Business Ethics Improved During Recession

Filed under: General HR Buzz — Tags: , , , 8:45 am

Finally some good workplace news to come out of the recession.

In the January issue of HR Magazine it was reported that a devastated U.S. economy did not translate into an increase in unethical behavior at U.S. companies, according to a study from the Ethics Resource Center (ERC). Although the ERC’s 2009 National Business Ethics Survey report found that retaliation against employees who reported misconduct has increased slightly since a similar survey two years earlier, most other measures of ethical behavior improved. According to the report:

Overall misconduct at U.S. workplaces is down. Fewer emloyees said they had witnessed misconduct on the job. This measure fell from 56% in 2007 to 49% in 2009.

  • Whistle-blowing has increased. Most workers (63%) who observed misconduct said that they reported it, up from 58% two years earlier.
  • Ethical culture appears to be stronger. The ERC’s measures of the strength of the ethical culture in the workplace increased from 53% in 2007 to 62% in 2009.
  • Pressure to cut corners has decreased declining slightly from 10% in 2007 to 8% in 2009.
  • Perceived retaliation as a result of a report of misconduct rose, from 12% to 15% over the past two years.

However the ERC researchers sound a warning saying that when more settled, prosperous times return, misconduct is likely to creep upward as the economic crisis dissipates.

During hard times, when a company’s well being or even existence may be on the line and regulators, board members and senior management are watching, management talks more about the importance of high standards to see the organization through. The result is staff are less inclined to commit misconduct when management is on high alert.

Source: HR Magazine, SHRM, Steve Bates, January, 2010


January 22, 2010

HR Fact Friday: Job Bias Claims Based on Religion & Disability Rise

The number of workers claiming job discrimintion based on disability, religion, or national origin surged to new highs last year, as federal job bias complaints overall stayed at near record levels.  The Equal Employment Opportunity Commission (EEOC) said Wednesday that charges of disability discrimination rose by about 10% to 21,451 claims, the largest increase of any category.  The increase coincided with changes to the Americans with Disabilities Act (ADA) last year that made it easier for people with epilepsy, diabetes and other treatable conditions to claim they are disabled.

Overall, the EEOC received more than 93,000 discrimination claims during the 2009 fiscal year, a 2% decrease from the record set in 2008, but still the second highest level in the commission’s history.  As in previous years, claims based on race, sex and retaliation were the most frequent.  Since the ADA was enacted in 1990, a series of Supreme Court rulings have generally exempted from its protections those with partial physical disabilites or impairments that can be treated with medication or devices such as hearing aids.

Legislation signed into law by President George W. Bush before he left office directs courts to apply the definition of disability more generously.  Charges of discrimination based on national origin rose by about 5% to 11,134 claims, while religious discrimination claims rose less than 1% to 3,386 claims.  Allegations of race discrimination remained the most frequently filed complaint, accounting for about 36% of all filings last year.

The EEOC said the near-historic level of complaints overall may be due to a number of factors, including economic conditions, increased diversity and demographic shifts in the work force. Employees also may be more aware of their rights and could be taking advantage of changes at the EEOC to make it easier to file a discrimination charge.

The EEOC enforces federal laws prohibiting employment discrimination.

Source: Yahoo Finance, Equal opportunity Commission (


October 14, 2009

Independent Contractor or Employee? How Do You Know and What Does It Matter?

Filed under: General HR Buzz — Tags: , , 1:53 pm

Independent Contractor Classification Issues Coming Under Greater Scrutiny

The independent contractor “issue” has become more visible in the last year, Congressional hearings have been held in which legislators have been urged to take action to address the issue of misclassification of employees as independent contractors.  Several states have also taken action to apply pressure to companies to revisit classifications.  It’s a subject that will likely see even more attention in the future.   Legislators have apparently heard enough complaints that some companies unfairly avoid their obligations by using contractors or that there simply is no justifiable reason to treat contractors so differently.

Independent Contractors:  A Money Saver and a Great Employer Solution?

The use of independent contractors has increased significantly in the last few years as employers seek to reduce costs and keep their workforces flexible. Whether a worker is an employee or a self-employed independent contractor imposes very different obligations on an employer.  Independent contractors are not on the payroll and do not enjoy many of the legal protections and benefits given employees. They also typically don’t count toward minimum thresholds required to determine whether employers are covered by certain federal employment laws. Generally, employers are not required to:

  • Provide Employee Insurance, Retirement and Leave Benefits
  • Pay Social Security & Medicare Taxes
  • Pay Federal & State Unemployment Taxes
  • Pay Overtime or Minimum Wages
  • Maintain Pay Records Under the FLSA
  • Pay Worker’ Comp Premiums
  • Provide protections under Title VII, the ADEA, ADA,  and Other Discrimination Acts
  • Provide protections under The National Labor Relations Act (which involves union issues)
  • Provide Leave Under the FMLA

Or, A Business Decision That Can Have Significant Negative and Costly Consequences…

It is often difficult to determine whether an individual should be classified as an employee or an independent contractor. Some organizations incorrectly assume that they can “declare” an individual as an independent contractor and that such a declaration will make it so.  But as with all things HR related, nothing is simple. Failure to make a legally correct contractor vs. employee determination, can lead to serious and expensive consequences.  The issue typically arises because of a government audit or an employee complaint.  In fact an employee (or an employer) can submit a Form SS-8 to the IRS ( for a finding of whether an individual is an employee or a contractor.  Over 85% of these forms are submitted by employees and in more than 90% of the cases the IRS finds an employee, not contractor situation.  We’ve included a copy of the Form for your review so you can see what the IRS considers in its determinations.

Too many organizations have ignored this issue (admittedly there are more interesting things to think about!).  Others have simply tried to save money by not following the law. Unfortunately, some of them have paid a high price for doing so.

Or, A Business Decision That Can Have Significant Negative and Costly Consequences… (Continued From Page 3)

In any event, it may be a good time to re-familiarize yourself with the law and various tests swirling around the independent contractor issue. Then examine your own contractors, audit your company’s practices, and take steps to assure future compliance.

How Do You Know if You Have an Independent Contractor?

Legal tests and factual situations, not labels determine whether someone is a contractor or an employee. Simply calling someone an independent contractor and having him sign a contract to that effect is not controlling. A number of details about the work relationship must be analyzed.

And…To Make Things More Confusing, There Is More Than One Test

Several different tests (Common Law, IRS Factor Control, Relative Nature of Work, ABC, and Economic Reality) are used to determine independent contractor status under federal and state law.  Which test is used depends upon the particular statutes or government agencies involved.  The result may be that a worker is an “employee” under one statute and can be considered an independent contractor under another.  As you might expect, the tests are not clear-cut and are open to interpretation.  However, the tests do have some significant similarities, with the main issue being:

Does the company control how the work will be performed (in which case you’ve likely got an employee) or does the company simply oversee the result(which would be more favorable to a finding of an independent contractor relationship).

Various Tests Used to Determine Employment Status Include:


Test Commonly Used

IRS Withholding

IRS Factor Control Test

Fair Labor Standards Act (FLSA)-

overtime & minimum wage

Economic Reality Test

Workers’ Comp

Relative Nature of Work

Unemployment Benefits

ABC Test

Discrimination (Title VII, Age Act, ADA) &

Affirmative Action

Common Law (“Right to Control”)

Test plus the Economic Reality Test)

Immigration (I-9’s)

IRS Test

ERISA (employee pension & welfare benefits)

Common Law (“Right to Control“)Test

Worker Adjustment & Retraining Notification Act (WARN)

Common Law (“Right to Control”) Test

National Labor Relations Act &

Labor Management Relations Act

Common Law (“Right to Control”) Test

The IRS Factor Control Test

For many years, the IRS used its “20 Factor Test” to determine if an employer exercises sufficient control to establish an employer-employee relationship. The IRS has attempted to “streamline” this by organizing the Factors into 3 groups: behavioral control, financial control, and the type of relationship. (The “20 Factors” remain important.).  The Factors are only guidelines and are not all applicable in every situation.  No one Factor is decisive, rather the entire situation must be considered.  The IRS Test includes most of the elements of the other tests and was based on the common law test.

Behavioral Control Factors

Indicative Of Employee Status

Indicative of Independent Contractor Status


On-the-job training often required. Provided training regarding processes & methods.

Already highly skilled and receives no training.


Must comply with company’s instructions and actions are more controlled. Tools & equipment supplied, dictated, and told where to purchase. Directed regarding what workers to hire or assist with work and what work must be performed by certain individuals. Order, sequence, hours, location of work may be determined.  Regular reporting.

Broader discretion and decision-making authority.  Supply own tools & equipment.  Hires. Pays, and  supervises own assistant. May or may not render services personally.  Sets own schedule.  May determine where work is performed. Regular, frequent reporting may not be required.

Financial Control Factors
Significant Investment in Facilities or Equipment

Little or None.

Considerable investment.


Company reimburses.

Pay own.


Doesn’t incur any economic loss.

Realizes a profit or loss.


Paid hourly, weekly.

Often paid by the job or project.

Parties’ Relationship
Written Contract

Not likely in an employee relationship. May be fired or can quit any time.

Possible evidence of independent contractor.  Contractual relationship affects termination.


Ongoing relationship. Works full-time for company.

Projects begin and end.  Hours not totally given to the company.  Generally shorter term and temporary.


Receive insurance, retirement, paid leave, etc.

No benefits.


Functions are an integral part of the business; similar to regular employees.

Services are separate and distinct from regular employees.

Multiple Employers & service availability

Doesn’t work for multiple employers and services not available to public.

Provides services to multiple organizations & services available to public.

Several factors, beyond the IRS test can also be considered.  High level, specialized skills are often indicative of independent contractor status.  The extent to which an individual establishes his own rate of pay, is paid after submitting an invoice, carries the risk of work accident, has consulted with an accountant regarding his business, or has a reputation as being available in the business community may also be relevant.

Final Things to Worry About

Remember that states have also gotten into the act.

Don’t think that you can relax once you’ve figured out the federal law and related tests. (If you ever do.) Some states have also been active in this area. Be sure you are familiar with your particular requirements. If nothing else you’d likely have workers’ comp and state unemployment issues to consider.

Using independent contractors inappropriately can create significant risks and liabilities. Payment of back taxes, back overtime, and related penalties could be just the beginning.  Consider the consequences of misclassifications if an individual is:

  • Improperly denied benefits. (ERISA provides protection here, forcing payment of back benefits and possibly creating breach of contract claims)
  • Injured on the job. (No workers comp coverage, so a company is vulnerable to a lawsuit)
  • Seriously ill and had not been considered eligible for FMLA.
  • Disabled and was discriminated against. (e.g., not reasonably accommodated)
  • Not counted as an employee.  (So the company appears not to be covered by Title VII, ADA, ADEA, FMLA, WARN Act, Affirmative Action purposes, etc….. when it really is.)
  • Not considered an employee and as a result no I-9 is on file.
  • If you use independent contractors be sure you know who owns the rights to the work. In the case of an employee, absent an agreement to the contrary, the company generally automatically owns the work product. That may not be the case with an independent contractor.
  • If you use independent contractors, use a contract. Make the contract in the name of the individual’s business, not her name. If possible, avoid hourly pay and reimbursement arrangements, and have the individual perform discrete projects, not ongoing work.
  • Remember,  sometimes no matter what you call the relationship, how you attempt to structure it, how you “dress it up” and even if you draft the best contract ever, you’ve still got an employment relationship, not an independent contractor.
  • Audit   your independent contractors’ status, before you’re challenged by an individual or the government.  Form SS-8 (included here) can help with that.

August 10, 2009

Age Discrimination Case Makes Things Easier For Employers

Filed under: Legal Issues — Tags: , , 2:00 pm

In the recently decided case U.S. Gross v. FBL Financial Services, Inc., the U.S. Supreme Court ruled that a plaintiff bringing an age discrimination case must prove that but for his age, the adverse job action at issue would not have happened.   Consequently, it’s no longer enough for a plaintiff to show that age discrimination was just a “motivating factor” or there was a “mixed motive.”  The decision makes it much easier for employers to win age bias cases as they are only liable for discriminatory conduct that actually causes an adverse action.

However, employers may not benefit from this ruling for long.  Congress is already talking about reversing it through legislation.


May 29, 2009

HR Fact Friday: EEOC Shows Spike in Discrimination Charges

Filed under: Employment Law — Tags: , , , , 1:47 pm

The number of age discrimination claims rose from 19,103 in 2007 to 24,582 in 2008, while retaliation claims rose from 26,663 to 32,690, just hundreds shy of overtaking the perennial number 1 type of charge filed with the U.S. Equal Employment Opportunity Commission (EEOC) – race discrimination, which rose to 33,937 charges. The figure for age discrimination charges is particularly striking, given that only 16,548 age discrimination charges were filed in fiscal 2006.

Source: HR Magazine, HR Briefs May, 2009


March 3, 2009

Athletic Club to Pay $161K to Settle Harassment Suit

Filed under: Harrasment — Tags: , , , 8:05 am

A Maryland athletic club has agreed to pay $161,000 to settle a sexual harassment lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC), the agency announced.

In the lawsuit, the EEOC alleged that Big Vanilla Athletic Club violated federal law by sexually harassing several female employees at the company’s locations in Pasadena and Arnold , Maryland . The agency said that the women were subjected to repeated and unwanted sexually offensive remarks and sexual advances. Further, the EEOC charged that three women were fired in retaliation for their complaints.

In addition to paying $161,000, the company agreed to train current and future managers on anti-discrimination laws and to post notices stating its commitment to maintaining an environment free of sexual harassment and retaliation.

In fiscal year 2007, retaliation charges surged 18 percent to a record high level of 26,663, making retaliation the second-highest charge category (behind race) for the first time ever. Additionally, sexual harassment filings increased for the first time since fiscal year 2000, numbering 12,510, a 4 percent increase from the prior fiscal year.


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