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VOLUME 18

ISSUE 3

PERSPECTIVES A Periodic Publication of Downes FishelPublication Hass Kim LLPof A Periodic

VOLUME 18, ISSUE 3 July 15, 2011

Inside This Issue 1

Verbal Complaint to Supervisor Enough to Trigger Protection Under the FLSA

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Ohio Supreme Court Recognizes Policy Prohibiting Retaliation Against an Employee Who May File a Workers’ Compensation Claim

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New ADAA Regulations Issued

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FLSA Update

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SERB Rules that Statements Made to Newspaper Reporter are not Direct Dealing

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Federal Court Allows Sexual Orientation Claim to Proceed

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SERB Upholds Employer Changes to CBA Due to Exigent Circumstances

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Upcoming Events

Downes Fishel Hass Kim LLP

Verbal Complaint to Supervisor Enough to Trigger Protection under the FLSA In Kasten v. Saint-Gobain Performance Plastics Corp., 131 S.Ct. 1325 (March 29, 2011), the U.S. Supreme Court ruled that an employee’s verbal complaint to a supervisor about the company’s timekeeping practices is a protected activity. The Fair Labor Standards Act of 1938 (Act) sets forth employment rules concerning minimum wages, maximum hours, and overtime pay. The Act contains an antiretaliation provision that forbids employers from discharging, “or in any other manner discriminate[ing] against any employee because such employee has filed any complaint or instituted or caused to be instituted any proceeding under or related to [the Act] . . . .” Kevin Kasten worked for Saint-Gobain. He alleged that SaintGobain located its time clocks between the areas where he and other workers put on and take off their work-related protective gear and otherwise carry-out their assigned tasks. That location prevented workers from receiving credit for the time they spent putting on and taking off their work clothes—contrary to the Act's requirements. Kasten claimed that Saint–Gobain discharged him because he orally complained to Saint–Gobain officials about the time clocks in accordance with the company’s internal grievance procedure. Kasten said he: (1)“raised a concern” with his shift supervisor that “it was illegal for the time clocks to be where they were” because of Saint–Gobain's exclusion of “the time you come in and start doing stuff”; (2) told a human resources employee that “if they were to get challenged on” the location in court, “they would lose”; (3) told his lead operator that the location was illegal and that he “was thinking about starting a lawsuit about the placement of the time clocks”; and, (4) told the human resources manager and the operations manager that he thought the location was illegal and that the company would “lose” in court. (Con’t on pg. 5…Verbal Complaint)

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Ohio Supreme Court Recognizes Policy Sutton’s second claim was that he was fired in Prohibiting Retaliation Against an Employee violation of Ohio public policy. Since 1990, Ohio Who May File a Workers’ Compensation Claim has recognized an exception to the employment In Sutton v. Tomco Machining, Inc., Slip Opinion No. 2011 Ohio 2723 (Jun. 9, 2011), the Ohio Supreme Court held that an injured employee may file a lawsuit against his employer for wrongful discharge when injured on the job, but fired before pursuing a workers’ compensation claim. Mr. Sutton was employed by Tomco Machining, Inc. He was an “atwill” employee. Sutton alleged that immediately after injuring his back while disassembling a chop saw, he informed the Company President of his injury. One hour later, the Company terminated him. The Company President gave no reason for the firing, but stated that Mr. Sutton’s firing was not because of work ethic, job performance or violation of work rules. Mr. Sutton filed for workers’ compensation after his termination.

“at-will” doctrine when an at-will employee is discharged or disciplined for reasons that contravene clear public policy expressed by the legislature in its statutes. The Court held that §4123.90 expresses a clear public policy prohibiting retaliatory employment action against an injured worker who has not filed, instituted or pursued a workers’ compensation claim. The Court reasoned that, in enacting §4123.90, the General Assembly did not intend to leave a gap in protection during which time employers are permitted to retaliate against employees who might pursue workers’ compensation benefits. In Sutton’s case, this meant that his second claim for wrongful discharge in violation of public policy can go forward.

Sutton filed a lawsuit against Tomco, asserting two claims. First, Sutton argued that his firing violated a provision in Ohio’s Workers’ Compensation Act, Revised Code §4123.90, which prohibits an employer from retaliating against an employee for initiating a workers’ compensation claim. Section 4123.90 prohibits an employer from firing an employee because he “files a workers’ compensation claim or institutes, pursues or testifies in a workers’ compensation proceeding.” Because Sutton had not yet filed, instituted or pursed a workers’ compensation claim, the statute did not apply. The Court stated that a “gap” exists in the language of the statute for conduct that occurs between the time immediately following injury and the time in which a claim is filed, instituted, or pursued. Sutton’s firing occurred in that gap.

Sutton still must prove that Tomco’s decision to fire him was “retaliatory.” The Court stated that discharge may be proper for reasons other than those related to workers’ compensation. The Court gave the following examples: injury not job related; violation of safety rules; and, immediate need for a replacement employee. The Court also states that “no presumption of retaliation arises” from the fact than an employee is discharged soon after an injury. The lesson for employers is simple. When taking an adverse employment action against an employee, make sure there is a legitimate basis for the action unrelated to an on the job injury or other unlawful reason. It is also prudent to assemble all documentation that supports the non-retaliatory reason for the employment action, so that the employer can prove a legitimate business reason if challenged in court.


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EMPLOYEE NEWSLETTER

New ADAA Regulations Issued The ADA Amendments Act of 2008 (ADAAA) made a number of significant changes to the definition of “disability” under the Americans with Disabilities Act (ADA). It also directed the U.S. Equal Employment Opportunity Commission (EEOC) to amend its ADA regulations to reflect the changes made by the ADAA. The EEOC issued its new regulations on March 25, 2011. They apply to all employers with 15 or more employees. The new regulations implement Congress’s mandate that the definition of disability be construed more broadly. The regulations keep the ADA’s definition of the term “disability” as a physical or mental impairment that substantially limits one or more major life activities; a record (or past history) of such an impairment; or being regarded as having a disability. However, the regulations implement significant changes from the ADAA regarding how those terms should be interpreted. For example, the regulations adopt “rules of construction” to use when determining if an individual is substantially limited in performing a major life activity. These rules of construction are derived directly from the statute and legislative history, and include: 

An impairment need not prevent or severely or significantly restrict a major life activity to be considered “substantially limiting.” Nonetheless, not every impairment will constitute a disability. The EEOC refused define a particular length of time the impairment must last to be considered a disability. In fact, the regulations state that the effects of an impairment lasting fewer than six months can be substantially limiting. The determination of whether an impairment substantially limits a major life activity requires an individualized assessment. However, the regulations list (Con’t on pg. 5…ADAA)

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FLSA UPDATE The Department of Labor has forecasted its plan to increase its enforcement of wage and hour laws, which includes notice of aggressive new recordkeeping regulations to the Fair Labor Standards Act (FLSA). The Wage and Hour Division of the Department of Labor (DOL) plans to introduce rules requiring employers to provide workers with basic information about their employment. This information includes the way in which pay is calculated. The proposed rule would also require employers to conduct a classification analysis on all employees. The employer would have to provide a copy of the analysis to its employees and retain a copy in the event of a request by a DOL investigator. The updated FLSA recordkeeping regulations will mandate three significant changes: (1) Communication to Employees, (2) Openness and Transparency; and, (3) Maintenance. Not only will the employer be required to communicate to its workers how their pay is to be calculated, but the manner of this communication must be frequent, facilitating openness and transparency. Employers will be required to maintain this information on file so it may be quickly provided to the Wage and Hour Division enforcement personnel if an investigator ever conducts an audit or inspection of the employer. To enact the recordkeeping regulations, the Department of Labor indicated that approximately 350 new investigators will be hired. The projected regulations will provide workers with more information and will put pressure on employers to practice “preventive medicine.” Employers will have an affirmative obligation under the law to make sure they are in compliance, document their analyses, and share this information with their workers. It is important that employers recognize the importance of these developments and begin reviewing their recordkeeping policies.


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EMPLOYEE NEWSLETTER

SERB Rules that Statements Made to Newspaper Reporter are not Direct Dealing Under Ohio law, employers may not deal directly with employees concerning mandatory subjects of bargaining during negotiations; rather, the employer must go through the employees’ bargaining representative (the Union). In SERB v. City of Elyria et al., 2011-003 (6-7-11), the State Employment Relations Board (“SERB”) found that a Mayor’s generalized statements to a newspaper reporter that were published in an area newspaper did not constitute direct dealing by the employer. Elyria Mayor William Grace was a member of the employer’s bargaining team for its negotiations with the IAFF Local 474. The City and Union did not establish ground rules during the bargaining process. Ground rules often include rules about discussions with the public. During bargaining, an independent audit by the McGrath Consulting Group, which found that firefighters enjoyed a disproportionately large amount of paid leave, was posted on the City’s website. In addition, the Mayor made a presentation to City Council while the bargaining process was ongoing. The presentation included a PowerPoint slideshow describing the benefits the firefighters enjoyed. Bargaining unit members were present at this meeting. Finally, the Mayor was contacted by a reporter from the Elyria Chronicle-Telegram about bargaining. The Mayor described to thereporter the firefighters’ accumulation of vacation, holiday, and sick leave conversions and stated that he felt the benefits needed to be decreased in order to save the City money. After publication of this article, the Union allegedly received an influx of calls from its members and blamed the article for fostering discontent between senior and junior firefighters. The Union filed an unfair labor practice against the City alleging that these actions constituted direct dealing because a member of the City’s bargaining team was distributing proposals directly to bargaining unit members through a public forum. In a unanimous decision, SERB concluded the City did not commit any unfair labor practices. SERB drew a line between an employer communicating specific proposals and the employer relating generalized bargaining goals to the news media. SERB concluded that the latter occurred here. In addition, both the McGrath Report and the Mayor’s PowerPoint utilized information that was a matter of public record (the firefighters’ salary and benefits) and the dissemination of this information on the City’s website and at an open City Council meeting did not constitute direct dealing. The fact that the parties did not establish ground rules relating to the public dissemination of information, and that the newspaper reporter herself did not testify, were referenced by the Administrative Law Judge in this case. If ground rules had been established and violated, the violator may have committed an unfair labor practice. Also, SERB determined that the newspaper, by itself, was untrustworthy hearsay evidence and could not be considered. Had the newspaper reporter testified the Mayor relayed specific bargaining proposals to her, the outcome in this case could have been different. Employers must adhere to any established ground rules. Also, if questioned by the media regarding bargaining issues, employers should not relay specific bargaining proposals during negotiations. All proposals made during negotiations should be made through the Union’s bargaining representative.


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EMPLOYEE NEWSLETTER

(Con’t from pg. 3…ADAA) certain impairments that virtually always will be disabilities, including: deafness, blindness, intellectual disability, partially or completely missing limbs, mobility impairments requiring a wheelchair, autism, cancer, cerebral palsy, diabetes, epilepsy, HIV infection, multiple sclerosis, muscular dystrophy, major depressive disorder, bipolar disorder, post-traumatic stress disorder, obsessive-compulsive disorder, and schizophrenia. 

Although determination of whether an impairment substantially limits a major life activity as compared to most people will not usually require scientific, medical, or statistical evidence, such evidence may be used if appropriate. Under the ADAA, an impairment that is episodic or in remission meets the definition of disability if it would substantially limit a major life activity when active. The regulations provide examples of impairments that may be episodic, such as epilepsy, hypertension, asthma, diabetes, major depressive disorder, bipolar disorder, and schizophrenia. With one exception (“ordinary eyeglasses or contact lenses”), the determination of whether an impairment substantially limits a major life activity shall be made without regard to the ameliorative effects of mitigating measures, such as medication or hearing aids.

The provisions of the ADAA and the new EEOC regulations make it much more likely that an impairment will be considered a “disability” under the Act. The primary focus will be whether an employer could provide a reasonable accommodation to the disabled worker or applicant. On its website, the EEOC has published a Fact Sheet and Question-AndAnswer document about the regulations. www.ada.gov.

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(Con’t from pg. 1…Verbal Complaint) Kasten alleges that this activity led the company to terminate him. He filed an action claiming that the activity was protected and that Saint-Gobain violated the Act’s anti-retaliation provision by discharging him for the complaints. The lower court dismissed Saint-Gobain, holding that the Act did not protect oral complaints, only written complaints. In its March 29, 2011, the Supreme Court reversed the lower court’s decision and allowed Kasten’s lawsuit to proceed. Citing the history behind the Act and the Act’s purpose, the Court held that an oral complaint of a violation of the Fair Labor Standards Act is protected conduct under the Act’s anti-retaliation provision. In other words, the language “filed any complaint” in the anti-retaliation provision encompasses oral complaints to supervisors. Verbal complaints are problematic for the employer because they can be mistaken for workplace banter or venting. In addition, they are difficult to prove. As time passes, memories fade and there is often no documentation of the verbal complaint. In the wake of Kasten, employers are cautioned to pay close attention to an employee’s verbal allegations in the workplace. If it is suspected that the employee is attempting the draw the employer’s attention to an allegedly unlawful activity, the employer should promptly investigate the basis for the Complaint.

Federal Court Allows Sexual Orientation Claim to Proceed A Judge from the United States District Court from the Northern District of Ohio has ruled that an employee’s sexual orientation claims may proceed against her public employer. In Hutchinson v. Cuyahoga County Board of Commissioners, et al., N.D. Ohio 1:08-CV2966 (April 25, 2011), the Court ruled that although sexual orientation is not a protected characteristic under Title VII, a claim can still proceed against a public employer under a Federal statute, 42 U.S.C. § 1983, for denial of equal protection under Fourteenth Amendment to the United States Constitution. (Con’t on pg. 7…Federal)


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SERB Upholds Employer Changes to CBA Due to Exigent Circumstances In 2001, SERB held that a party cannot modify an existing collective bargaining agreement without negotiation and agreement of both parties unless immediate action is required due to either: 1) exigent circumstances that were unforeseen at the time of negotiations; or 2) legislative action taken by a higher-level legislative body after the agreement became effective that requires a change to conform to statute. SERB v. City of Toledo, SERB 2001-005 (9-20-2001). SERB has infrequently applied that test since 2001. Recently, though, SERB had occasion to address the “exigent circumstances” exception in another case from the City of Toldeo. SERB v. City of Toldeo, SERB 2011-001 (4-29-2011). In January, 2010, the City of Toledo’s budget deficit for fiscal year 2010 was projected to be $37 million. The City had no “rainy day” fund to help balance the budget. In January and February, 2010, the Mayor met with leaders of all 8 of the bargaining units in the City and with members of the community and local business to discuss the budget and to seek input on closing the deficit. The process involved a multi-step strategy of cutting expenditures; increasing revenue through fee increases to the general public, selling city-owned assets; and, seeking concessions from City employees. In February, 2010, the Mayor asked each union for mid-term contract concessions. He proposed to eliminate the City’s pension pick-up, require all employees to pay twenty percent (20%) of the health insurance premiums, and to have employees take a ten percent (10%) wage reduction. The Unions did not respond to the Mayor’s requests for concessions. If the City did not balance the budget by March 31, 2010, it would have insufficient funds within one month to continue operating essential services, i.e., police, fire, and refuse-collection. On March 30, 2010, City Council passed ordinances that balanced the budget for Fiscal Year 2010. By late May, 2010 members of five (5) of the bargaining units reached tentative agreement with the City on concessions. Members of two (2) additional bargaining units were excepted from the pension pick-up and health insurance changes. The final union, the Toledo Police Command Officers’ Association (“TPCOA”) reached tentative agreement, but its members rejected the agreement. The City implemented the changes and the TPCOA filed an unfair labor practice charge against the City. SERB dismissed the charge, finding the City’s changes were due to “exigent circumstances” that were not foreseen at the time of negotiations between the City and TPCOA in 2009. SERB found that the City’s predicament fits the description of “exigent circumstances.” In order to balance the budget and avoid a City government shutdown, immediate action was required by City Council to address these circumstances. As a result, the City did not commit an unfair labor practice in implementing these changes. Employers are cautioned to seek legal counsel before making modifications to an existing collective bargaining agreement. The City of Toledo was in a harsh predicament, but was able to articulate the nature of the shortfall and the need for urgent action. The parameters of the “exigent circumstances” test have not been fully articulated.

City of Toledo


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(Con’t from pg. 7…Federal) Shari Hutchinson, a gay woman, was employed by the Cuyahoga County Support Enforcement Agency (CSEA). She filed a lawsuit against the Cuyahoga County Commissioners and four CSEA administrators. Hutchinson alleges that Defendants did not hire or promote her to various job openings within the CSEA because of her sexual orientation. Hutchinson brought her claims under a federal statute permitting public employees to sue their employers for a violation of their Constitutional rights, 42 U.S.C. §1983. Hutchinson claims that she was denied equal protection of the law because of her sexual orientation. Defendants sought to have her Complaint dismissed at the outset, arguing sexual orientation is not an actionable equal protection violation. Courts have analyzed § 1983 employment discrimination claims under the Title VII framework. Defendants argued that Hutchinson’s equal protection claims failed because sexual orientation is not a protected class under Title VII. The Court disagreed with Defendants, holding: “Simply because Title VII does not include sexual orientation as a statutorily protected class does not, in this Court’s view, automatically remove all constitutional protection where a plaintiff employee claims equal protection violations based on her membership in that class.” The Court concluded that Hutchinson’s complaint states a plausibly actionable equal protection claim under § 1983. Hutchinson will now be required to prove what she has alleged in her Complaint. Hutchinson also alleged that the County’s policy for awarding health care coverage opt-out credits discriminated against homosexuals. Under the program, the County pays a $100 per paycheck opt-out credit for married (heterosexual) employees who decline coverage for herself and her spouse. Because Hutchinson was not married, she was ineligible for the opt-out payment. The Court concluded that the program did not deny Hutchinson equal protection of the law on the basis of her sexual orientation. The County’s program equally excludes gay and straight domestic partners. This part of Hutchinson’s lawsuit was dismissed. Traditionally, employment discrimination claims are brought under the Federal anti-discrimination statute, Title VII, or Ohio’s law that largely mirrors Title VII. Neither statute prohibits discrimination on the basis of sexual orientation directly (though a claim has been recognized for adverse employment action due to non-conformance to traditional gender stereotypes). Hutchinson clarifies the Court’s continued intent to recognize sexual orientation discrimination claims.


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Upcoming Events

Advanced Workers’ Compensation Seminar ................................................. July 28 Licking Co. Chamber of Commerce’s Summer Seminar Series............. Aug. 18 Unemployment Insurance 101 ............................................................................. Sept. 27 Police Liability Seminar............................................................................................ Oct. 12

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Matthew Whitman joined DFHK in February, 2011 as an associate attorney. Matt worked as an attorney for the State Employment Relations Board before coming to DFHK. He graduated Cum Laude from The Ohio State University Moritz College of Law in 2009. He graduated Magna Cum Laude with a B.A. in History from Ohio Wesleyan University in Delaware Ohio in 2006. Matt hails from the Southeastern Ohio Village of Minford. Matt focuses his practice on Labor and Employment law. Kari France joined DFHK in April, 2011 as Office/Legal Support Manager. Kari worked as a paralegal for Baker & Hostetler LLP before coming to DFHK. She graduated with a B.A. in Sociology and Criminology from The Ohio State University in 2005. She obtained her paralegal certificate from the University of Cincinnati in 2006.

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The Insurance Loss Control Association Annual Conference ............... Oct. 3-5

Welcome Aboard

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As always, our Firm welcomes information from interested individuals regarding court decisions, arbitration decisions, and other matters. If you have any Information which you believe to be of interest, please feel free to contact us.

400 S. Fifth Street, Suite 200 Columbus, Ohio 43215 PH: (614) 221-1216 FX: (614) 221-8769 www.DownesFishel.com

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