Uber drivers get partial win in opposing FAA arbitration.


An important development: Singh v. Uber (3rd Cir 09/11/2019) [PDF]

Singh brought a putative class action in state court alleging that Uber misclassified its drivers as independent contractors as opposed to employees. Uber removed the case to federal court and moved to compel arbitration. Singh opposed the motion, arguing that the court did not have the authority to compel arbitration under the Federal Arbitration Act (FAA). The trial court ordered arbitration. The 3rd Circuit remanded.

FAA Section 1 provides that the FAA does not apply to

“contracts of employment of seamen, railroad employees, or any other class of workers engaged in foreign or interstate commerce.”

New Prime Inc. v. Oliveira, 139 S. Ct. 532 (2019) held that ''contracts of employment" includes any contract for the performance of work by workers, so the issue in this case becomes whether Singh was "engaged in … interstate commerce."

The 3rd Circuit rejected Uber's argument that the Section 1 exclusion applies only to workers who transport goods, and not to those who transport passengers, saying "§ 1 is not limited to transportation workers who transport goods, but may also apply to those who transport passengers, so long as they are engaged in interstate commerce or in work so closely related thereto as to be in practical effect part of it."

The 3rd Circuit remanded for the trial court to allow discovery on the issue of whether the class of transportation workers to which Singh belongs are engaged in interstate commerce or sufficiently related work.

Will the NLRB crack down on highly offensive speech?

It's about time.

The NLRB is requesting briefs on whether the Board should reconsider its standards for profane outbursts and offensive statements of a racial or sexual nature.

The current NLRB cases really cannot be defended. If – during a strike or during picketing – an employee makes the most outrageous statements (rude, racially offensive, sexually offensive), then this is part of "protected" activity and the employer cannot fire or otherwise discipline an employee for doing that.

Of course, some rough language ought to be tolerated when a union and employer are engaged in economic warfare. But let's find a rule that no longer protects speech that is simply ugly racial and sexual slurs.

The Board seeks public input on whether to adhere to, modify, or overrule the standard applied in previous cases in which extremely profane or racially offensive language was judged not to lose the protection of the National Labor Relations Act (NLRA). Specifically, the notice seeks comments relating to the following cases: Plaza Auto Center, 360 NLRB 972 (2014), Pier Sixty, LLC, 362 NLRB 505 (2015), and Cooper Tire, 363 NLRB No. 194 (2016).

About the invitation for briefing, Chairman John F. Ring stated: “The Board’s request for briefing on this important topic reflects its long-standing practice of seeking input from interested parties when the Board believes it can benefit from such briefing. We look forward to considering the views of all interested parties.”

Chairman John F. Ring was joined by Members Marvin E. Kaplan and William J. Emanuel in inviting the filing of briefs. Member Lauren McFerran dissented.

Amicus briefs not to exceed 25 pages in length shall be filed with the Board in Washington, D.C. on or before November 4, 2019. The parties are permitted to file responsive briefs not to exceed 15 pages in length on or before November 19, 2019.

The case is General Motors LLC, 14-CA-197985 and 14-CA-208242. Click here to read the notice and invitation to file briefs.


Sexual orientation harassment at the porn store


It can happen anywhere – this time at a pornographic video store.

Wilford Bearden, an openly gay man, was a clerk in a pornographic video store. In graphic detail, the Oregon Court of Appeals described harassment at the hands of other clerks. This included sexually offensive comments written on copies of a magazine (over a period of three months) plus an extraordinarily raunchy cartoon drawn by a clerk. The manager terminated Bearden soon after the cartoon incident.

Bearden won a judgment after a bench trial on his claim of discrimination on the basis of his sex and sexual orientation and his claim of retaliation for complaining about sexual harassment. The trial court denied the employer's motion for a directed verdict. The Oregon Court of Appeals affirmed the verdict, and remanded for reconsideration of the attorney fee award. Bearden v. N. W. E. Inc (Oregon Ct App 08/07/2019) [PDF].

On the retaliation claim, the court found sufficient evidence that Bearden complained to a clerk, who passed that information on to the manager, so the manager knew of Bearden's complaint when she terminated him.

On the discrimination claim, there was evidence that the harassment was because of Bearden's sexual orientation (in spite of the perpetrators' testimony that they did not intend their comments to be sexual) and evidence that the materials were objectively offensive to a gay man.

The court found that the harassment was severe or pervasive enough to alter the conditions of employment and create an abusive working environment; it lasted three months and culminated in the raunchy cartoon. Management was aware of the situation "enough to require an investigation, which would quickly have yielded the information that plaintiff's complaint was legitimate."

The court remanded for a re-determination of attorney fees. The trail court had categorically denied fees incurred during BOLI proceedings, but must now evaluate how much was reasonably incurred to achieve Bearden's success in the litigation. The trial court must also provide a more complete explanation of why it awarded less than the full amount of fees Bearden requested in connection with his motion for summary judgment, which was denied.

NLRB proposes rulemaking on employee free choice


The NLRB will publish a Notice of Proposed Rulemaking [Federal Register] on August 12, 2019, proposing three amendments to its Rules and Regulations that "would better protect employees’ statutory right of free choice on questions concerning representation."

Blocking Charge Policy: Replace the current blocking charge policy with a vote-and-impound procedure. Elections would no longer be blocked by pending unfair labor practice charges, but the ballots would be impounded until the charges are resolved.

Voluntary Recognition Bar: Return to the rule of Dana Corp., 351 NLRB 434 (2007). For voluntary recognition under Section 9(a) of the Act to bar a subsequent representation petition—and for a post-recognition collective-bargaining agreement to have contract-bar effect—unit employees must receive notice that voluntary recognition has been granted and a 45-day open period within which to file an election petition.

Section 9(a) Recognition in the Construction Industry: In the construction industry, where bargaining relationships established under Section 8(f) cannot bar petitions for a Board election, proof of a Section 9(a) relationship will require positive evidence of majority employee support and cannot be based on contract language alone, overruling Staunton Fuel, 335 NLRB 717 (2001).

Public comments are invited on all aspects of the proposed rule and should be submitted within 60 days of the Notice’s publication in the Federal Register.

Title VII – cert petition on "ultimate employment decisions"


Sometimes a US Supreme Court cert petition catches my eye. Today it was Peterson v. Linear Controls [briefs]

Formally, the question presented is "Whether the 'terms, conditions, or privileges of employment' covered by Section 703(a)(1) of Title VII of the Civil Rights Act of 1964 are limited only to hiring, firing, promotions, compensation and leave."

The 5th Circuit, in an unpublished opinion, reiterated its stingy interpretation of Title VII's anti-discrimination language. In this race discrimination lawsuit, the court said it "strictly construes adverse employment actions to include only 'ultimate employment decisions,' such as 'hiring, granting leave, discharging, promoting, or compensating. '” Peterson v. Linear Controls (5th Cir 02/06/2019) [PDF]

Peterson alleged that he was on a team of five white employees and five black employees, and the black employees had to work outside and were not permitted water breaks, while the white employees worked inside with air conditioning and were given water breaks. The 5th Circuit ruled that – assuming the allegations are true – it was not error for the trial court to hold that these working conditions are not adverse employment actions because they do not concern ultimate employment decisions.

Of course, the 5th Circuit is wrong, but that's usually not enough to rally the four Justices needed to grant certiorari. The fact that there is a split of authority among the circuits will be a major factor in deciding whether to grant certiorari. The 3rd Circuit is almost as strict as the 5th (some say it's just as strict). Seven other Circuits reject the 5th Circuit's restrictive approach – the 2nd, 6th, 7th, 8th, 9th, 10th, and 11th Circuits.

The key statutory language:

“to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual” with respect to “compensation, terms, conditions, or privileges of employment” because of the individual’s race, religion, sex, or other protected status.

The brief from Linear Controls isn't due until September 9, so we have a bit of a wait before we know whether the Supreme Court will take up this case.

More on California meal and rest breaks


It looks like the California meal and rest break saga has no end. Case in point: Cole v. CRST Van Expedited (9th Cir 08/01/2019) [PDF].

The 9th Circuit has certified the following questions to the California Supreme Court:

(1) Does the absence of a formal policy regarding meal and rest breaks violate California law?

(2) Does an employer's failure to keep records for meal and rest breaks taken by its employees create a rebuttable presumption that the meal and rest breaks were not provided?

Cole, a truck driver, brought class action claims on behalf of himself and other truck drivers alleging the employer failed to give them rest and meal breaks. The district court ruled in favor of the employer.

Cole maintains that the district court erroneously concluded that the employer complied with California law simply because it did not prevent its employees from taking breaks. Cole asserts that California law mandates that the employer affirmatively provide breaks by adopting a policy authorizing them. Cole emphasizes that the employer did not have such a policy, did not record meal breaks on its payroll statements, and did not pay its drivers for rest breaks.

COTW #35 - Is Dynamex retroactive?

Vazquez v. Jan-Pro Franchising (9th Cir 07/22/2019) [PDF] is our Case-of-the Week.

Two months ago, the 9th Circuit shook things up by ruling that California’s Dynamex case applies retroactively.

Remember: Dynamex v. Superior Court (California 04/30/2018) [PDF] held that the “ABC” test applies to the issue of whether workers are employees rather than contractors under California Wag Orders.

Now the 9th Circuit has withdrawn its retroactivity opinion, and will certify the question of retroactivity to the California Supreme Court.

This is the right thing to do. It’s an important question of state law that ought to be decided by the state court.

COTW #34 - Obesity is always an impairment under Washington State disability discrimination statute

Casey Taylor sued the employer under the Washington Law Against Discrimination (WLAD) for refusing to hire him due to his obesity. After the case was removed to federal district court, it granted summary judgment to the employer. On appeal to the 9th Circuit, that court certified to the state Supreme Court the question of when obesity qualifies as an impairment under WLAD. The state Supreme Court accepted certification and held that obesity always qualifies as an impairment under WLAD. Taylor v. BNSF Railway (Washington 07/11/2019) [PDF].

Worth repeating: Always qualifies as an impairment

The employer refused to hire Taylor, who had a BMI of 41, which meets the technical definition of severe obesity, because it had a policy of not hiring people with BMIs exceeding 35. The district court granted summary judgment to the employer based on federal cases holding obesity is not a disability unless it results from a separate, underlying physiological disorder.

The state Supreme Court answered the certified question by stating obesity is always an impairment under the plain language of WLAD because it is a physiological condition affecting one or more body systems. The court expressly rejected federal court treatment of obesity under the ADA on the basis WLAD is broader than the ADA and offers its own independent protections to employees.

This is Washington State. Most other places require a showing that obesity is a disability only if it results from a separate, underlying physiological disorder.

COTW #33 - Bikini Baristas

"Bikini Baristas" were wearing a lot less than your typical bikini, and they were doing a lot more than what you normally find on a barista job description.

The City adopted a dress code ordinance, and amended their lewd conduct ordinance. These basically specify certain body parts that need to be covered up.

Some baristas brought a lawsuit and a federal district judge issued a preliminary injunction against these ordinances on the ground that they were void for vagueness and that they interfered with the Baristas’ 1st Amendment rights.

The 9th Circuit, however, took a look at it and said look — it's not void for vagueness. A person of ordinary intelligence can ascertain what these ordinances are actually saying, and what they mean.

And the dress code is okay in terms of 1st Amendment because the court didn't see how any person on the street could understand what these baristas were actually trying to communicate by the way they were dressed.

COTW #32 - Telecommuting as an ADA accommodation

Today’s Case-of-the-Week — Bilinsky v. American Airlines (7th Cir 06/26/2019) [PDF] —caught my eye because it involved the controversial question of whether telecommuting can be a reasonable accommodation under the Americans with Disabilities Act (ADA).

Well, of course, the answer always is “It depends.”

Here an employee with MS successfully telecommuted from her home in Chicago, while the on-site department was in Dallas. That worked out fine until the Dallas department began changing the nature of its work. Previously it was mainly preparing various written materials. Then it began staging live events in Dallas, and doing crisis management. So the boss began requiring the employee to be on site in Dallas.

The 7th Circuit split 2-1. The majority supported granting summary judgment for the employer on the basis that the employee could not perform the essential functions of the job (i.e., being on site).

The dissent would have let the case go to a jury to decide whether being on site really was an essential function.

Personally, I thought the majority was a little too quick to take a crucial fact-finding function away from the jury. 7th Amendment, and all that.

COTW #31 - Unconscionable arbitration agreement

Today’s Case-of-the-Week — Burnett v. Pagliacci Pizza (Washington Ct App 06/17/2019) [PDF] —caught my eye because of the somewhat non-traditional way the court handled the question of unconscionability.

Most courts find a contractual provision (arbitration clause or otherwise) unconscionable only if it is both procedurally and substantively unconscionable.

Procedural unconscionability has to do with how the contract was formed — adhesion contract, take-it-or-leave it approach, huge difference in bargaining power, etc.

Substantive unconscionability has to do with the actual terms in the contract — things that are vastly one-sided, harsh, or unlawful.

In this case the court — remarkably — held that procedural unconscionability alone will do the trick.

Ban on transgender personnel in the military will receive intermediate scrutiny; injunction against the ban is stayed.

Here’s a complicated case, raising important issues about the rights of transgender individuals, the extent of executive branch privileges, and the amount of deference courts should grant to military decisions.

In 2017 the President issued a Memorandum barring transgender individuals from serving in the military, but a federal district court issued a preliminary injunction against enforcement of the 2017 Memorandum. In 2018 the President revoked his 2017 Memorandum and authorized the Secretary of Defense to implement the policies he proposed based on a 44-page report. Defendants then requested that the district court dissolve its preliminary injunction, but the district court struck that motion. While defendants were appealing that order, the district court denied defendants' motion for a protective order of discovery and granted plaintiffs' motion to compel production of documents that defendants withheld under a claim of two executive branch privileges. Defendants then petitioned the 9th Circuit for a writ of mandamus challenging the discovery order.

In Karnoski v. Trump (9th Cir 06/14/2019) [PDF] the 9th Circuit:

(1) vacated the district court’s order striking the Defendants’ motion to dissolve the preliminary injunction and remanded to the district court to reconsider the motion. This was on the ground that the 2018 Policy was significantly different from the 2017 Memorandum. In evaluating whether the significant change warrants dissolution of the preliminary injunction, the 9th Circuit rejected the district court's strict scrutiny approach. "[T]he district court should apply a standard of review that is more than rational basis but less than strict scrutiny." In addition, the district court "must apply appropriate military deference to its evaluation of the 2018 Policy." "In applying intermediate scrutiny on remand, the district court may not substitute its 'own evaluation of evidence for a reasonable evaluation' by the military."

(2) issued a stay of the preliminary injunction (which had previously been ordered by the US Supreme Court).

(3) vacated the district court’s discovery order and directed the district court to reconsider discovery by giving careful consideration to executive branch privileges. These include the deliberative process privilege and the presidential communications privilege.

SCOTUS: EEOC exhaustion is not jurisdictional

Monday's unanimous US Supreme Court Title VII decision in favor of the employee does not give employee-plaintiffs a free pass. Exhaustion of EEOC administrative processes is still required. All the Court did was say exhaustion is not a jurisdictional question that can be raised after five years of litigation. Employers can still get cases dismissed for failure to exhaust if they raise the issue early on in the litigation.

Fort Bend County v. Davis (US Supreme Ct 06/03/2019) [PDF]

The employee filed an EEOC charge claiming sex harassment. Later she wanted to add religion. So she wrote “religion” on the intake form, but she never revised the formal EEOC charging document.

Then she sued claiming religious discrimination, and the employer — after years of litigation — raised the question that the EEOC form had not been properly filled out. So the question was: is this a jurisdictional issue that the employer can raise at any time even the years later? Or is it a claims processing rule that the employer waived by waiting so long?

The US Supreme Court says it's non-jurisdictional.

So this is something the employer can raise but – use it or lose it.

Physician loses Title VII case

A hospital terminated a physician's hospital privileges, and she thought she had a Title VII case. But she was not an employee of the hospital. Levitin v. Northwest Community Hosp (7th Cir 05/08/2019) [PDF].

The court applied a five-factor test: (1) the extent of the employer’s control and supervision over the worker, including directions on scheduling and performance of work; (2) the kind of occupation and nature of skill required, including whether skills are obtained in the workplace; (3) responsibility for the costs of operation, such as equipment, supplies, fees, licenses, workplace, and maintenance of operations; (4) method and form of payment and benefits; and (5) length of job commitment and/or expectations.

But let's face it. Control is the main factor. The court summarized that this way:

Levitin owned her own medical practice, billed her patients directly, and filed taxes as a self-employed physician. Northwest did not provide Levitin with employment benefits or pay her professional licensing dues. Moreover, Levitin’s work agreement with Northwest confirms her independence. She could set her own hours, subject only to operating-room availability; she could obtain practice privileges at other hospitals and redirect her patients to those locations; and she could use her own staff in surgeries. Most importantly, she made the treatment decisions for her patients.

The physician had a theory that the hospitals' peer-review committee (which recommended terminating her privileges) was exerting the kind of control that made her an employee. But the peer-review committee was reviewing her work after-the-fact. That's not the kind of control that turns her into an employee.