Minnesota has not passed a medical marijuana law, but 14 states and the District of Columbia have, and occasionally such laws have employment law implications.  The American Civil Liberties Union filed a lawsuit two weeks ago against Wal-Mart Stores, Inc. and the manager of its Battle Creek, Michigan store for wrongfully firing an employee for using medicinal marijuana in accordance with state law.

Joseph Casias, the Battle Creek Wal-Mart’s 2008 Associate of the Year, was fired from his job at the store after testing positive for marijuana, despite being legally registered to use the drug under Michigan’s medical marijuana law.  Casias has sinus cancer and a brain tumor in the back of his head and neck that was the size of a softball when it was first diagnosed. His condition has forced him to endure extensive treatment and chemotherapy, interferes with his ability to speak and is a source of  constant pain. Nonetheless, he had been employed for more than five years by Wal-Mart in Battle Creek, where he began as an entry-level grocery stocker in 2004 and worked his way up to inventory control manager.

In 2008, Michigan voters enacted the Michigan Medical Marihuana Act, which provides protection for the medical use of the drug under state law. After the law was enacted, Casias’ oncologist recommended that he try marijuana for pain relief, and so Casias obtained the appropriate registry card from the Michigan Department of Community Health

Michigan’s medical marijuana law protects patients registered with the state of Michigan from “arrest, prosecution, or penalty in any manner” for the use of medicinal marijuana as prescribed by a doctor and also protects employees from being disciplined for their use of medical marijuana in accordance with the law. The law does not require employers to accommodate the ingestion of marijuana in the workplace and does not protect employees who work under the influence of the drug.   Casias’ lawsuit claims that he complied with both of these conditions.

If the allegations in the Complaint are true, it is hard to see how Wal-Mart can win this one (either legally or in the court of public opinion!)  So stock up on the Doritos and stay tuned in !

Employers often struggle, and rightly so, with deciding how best to treat employees who have some physical or mental impairment, especially if the impairment seems to be affecting their work performance.  It is often very hard to balance the demands of expected workplace performance with an employee’s rights under the Americans with Disabilities Act (ADA) and Family and Medical Leave Act (FMLA).  A Court of Appeals decision last week provides a good review of some of the most important principals.

Factual Background

Charlene K. Wisbey worked as an Emergency Dispatcher for the City of Lincoln, Nebraska.   The position required her to receive calls for emergency service and dispatch emergency service units on a regular basis.  Prior to 2007, Wisbey’s performance evaluations were positive.

From January through February 2007, Wisbey used a significant amount of sick leave due to an upper respiratory infection. Because she had previously exhausted her allotted sick leave, the City issued her a written warning for taking excessive leave and recommended that she apply for intermittent leave under the FMLA.  On February 27, 2007, Wisbey applied for intermittent FMLA leave on the basis of depression and anxiety, claiming on the application that she had a serious health condition that rendered her “unable to perform the essential functions of her job.” Attached to the FMLA application was a medical certification from her physician, Dr. Pothuloori, stating that Wisbey suffered from recurring depression and anxiety which interfered with her sleep, energy level, motivation, and concentration.  Dr. Pothuloori’s certification also indicated that, although Wisbey was able to perform any one or more of the essential functions of her job,  she would need to take time off work intermittently over the next six months or longer.  

Because the medical certification from Dr. Pothuloori indicated that Wisbey’s concentration and motivation could be affected, the City scheduled an appointment for Wisbey with Dr. Eli Chesen, a psychiatrist, requesting that he perform a fitness-for-duty exam to determine whether Wisbey was qualified to continue her work as an emergency dispatcher.  After the examination, Dr. Chesen submitted a three-page report on his findings. The report stated that Wisbey suffered from chronic relapsing depression which intermittently interfered with her ability to function at full capacity at work, and that she was not “fit for duty as described in her job description, especially as related to tiredness, her ability to concentrate and her ongoing propensity to likely miss work.”

After receiving this report on March 28, 2007, the City expressed to Wisbey its concern that she could not perform her job, and placed Wisbey on administrative leave with pay. On April 3, 2007, the City met with Wisbey and provided her with a letter explaining that she was being terminated based on Dr. Chesen’s determination that she was unfit for duty. The letter also encouraged Wisbey to apply for long term disability benefits.  Wisbey filed suit instead. 

Legal Analysis

Wisbey first argued that she should not have been required to submit to a fitness-for-duty exam.  The ADA prohibits an employer from requiring a medical examination or inquiring into the disability status of an employee “unless such examination or inquiry is shown to be job-related and consistent with business necessity.”  The employer bears the burden to show the asserted business necessity is actually vital to the business and the request for a medical examination or inquiry is no broader or more intrusive than necessary.  At the same time, employers are permitted to use reasonable means to ascertain the cause of troubling behavior without exposing themselves to ADA claims, and fitness-for-duty exams are a reasonable means of making this determination.  Courts will readily find a business necessity if an employer can demonstrate a medical examination or inquiry is necessary to determine whether the employee can perform job-related duties when the employer can identify legitimate, non-discriminatory reasons to doubt the employee’s capacity to perform his or her duties (such as frequent absences), or whether an employee’s absence or request for an absence is due to legitimate medical reasons, especially where the employer has reason to suspect the employee is abusing its attendance policy.  The Court concluded that in light of Wisbey’s position as a dispatcher making life and death decisions supports, the City’s request for a fitness-for-duty exam was proper.

Wisbey next argued that she was not actually disabled, but that the City terminated her because it illegally “regarded: her as disabled.   As the Court noted, however, the prohibition against making decisions because an employer inappropriately “regards” an employee as disabled was established to combat “archaic attitudes, erroneous perceptions, and myths” working to the disadvantage of the disabled or perceived disabled  By contrast, if a restriction is based upon the recommendations of a physician, then it is not based upon myths or stereotypes about the disabled and does not establish a perception of disability.  Wisbey was terminated because she was not “fit for duty,” as reported by Dr. Chesen, and because she herself admitted in her FMLA application that she was suffering a serious health condition that rendered her unable to perform the essential functions of her job.  Accordingly,  there was no evidence of “regarded as” discrimination. 

In regard to her FMLA claim, Wisbey argued that  the fitness-for-duty exam was unwarranted because the City had previously accepted Dr. Pothuloori’s certification that she could perform any one of more of the essential functions of her job, although she would need to take time off work intermittently.  The Court found, however, that the FMLA does not provide an employee with a right to unscheduled and unpredictable, but cumulatively substantial, absences, or a right to take unscheduled leave at a moment’s notice for the rest of her career. On the contrary, such a situation implies that she is not qualified for a position where reliable attendance is a bona fide requirement.  Therefore, because Wisbey requested “intermittent leave” for “six months or longer” she did not have a right to FMLA leave.

Finally, the Court also rejected Wisbey’s argument that the City retaliated against her for taking FMLA leave because she could not establish a causal connection between her application for FMLA leave and her termination.  Rather, the City relied on the fitness-for-duty exam, and not Wisbey’s FMLA application, in its determination to terminate Wisbey’s employment. Generally, more than a temporal connection is required to present a genuine factual issue on retaliation,  and mere coincidence of timing can rarely be sufficient. 

Conclusion

In sum, then, employers struggling with these issues should keep the following points in mind:

• Employers are permitted to use reasonable means to ascertain the cause of troubling behavior as long as they have a business reason to do so.  Courts will readily find a business necessity if an employer can demonstrate a medical examination or inquiry is necessary to determine whether the employee can perform job-related duties when the employer can identify legitimate, non-discriminatory reasons to doubt the employee’s capacity to perform his or her duties (such as frequent absences).
• Courts will give great deference to recommendations made by outside professionals such as physicians.
• Neither the FMLA nor the ADA provides an employee with a right to unscheduled and unpredictable, but cumulatively substantial, absences, or a right to take unscheduled leave at a moment’s notice for the rest of her career. On the contrary, such a situation implies that she is not qualified for a position where reliable attendance is a bona fide requirement.  And employers should make sure that their job descriptions specifically reference regular and reliable attendance as an essential requirement of the job.

On June 22, 2010, the U.S. Department of Labor issued a new interpretation of the definition of “son or daughter” under the Family and Medical Leave Act which will expand the number of employees who are eligible for leave, especially those in a same sex relationship.

As background, the FMLA entitles an eligible employee to take up to 12 workweeks of job-protected leave, in relevant part, because of the birth of a son or daughter of the employee and in order to care for such son or daughter, because of the placement of a son or daughter with the employee for adoption or foster care, and to care for a son or daughter with a serious health condition. The FMLA defines a “son or daughter” as a biological, adopted, or foster child, a stepchild, a legal ward, or a child of a person standing in loco parentis, who is under 18 years of age, or 18 years of age or older and incapable of self-care because of a mental or physical disability.

The question addressed by the Department of Labor this week is how to determine whether an employee is “in loco parentis”.  The DOL suggests that in loco parentis is commonly understood to refer to “a person who has put himself in the situation of a lawful parent by assuming the obligations incident to the parental relation without going through the formalities necessary to legal adoption.”

According to the DOL, the key in determining whether the relationship of in loco parentis is established is found in the intention of the person allegedly in loco parentis to assume the status of a parent toward the child. The intent to assume such parental status can be inferred from the acts of the parties.  Thus, whether an employee stands in loco parentis to a child is a fact issue dependent on multiple factors, including the age of the child; the degree to which the child is dependent on the person claiming to be standing in loco parentis; the amount of support, if any, provided; and the extent to which duties commonly associated with parenthood are exercised.

The FMLA regulations define in loco parentis as including those with day-to-day responsibilities to care for and financially support a child. Significantly, employees who have no biological or legal relationship with a child may nonetheless stand in loco parentis to the child and be entitled to FMLA leave.  According to the DOL, the regulations do not require an employee who intends to assume the responsibilities of a parent to establish that he or she provides both day-to-day care and financial support in order to be found to stand in loco parentis to a child.  For example, where an employee provides day-to-day care for his or her unmarried partner’s child (with whom there is no legal or biological relationship) but does not financially support the child, the employee could be considered to stand in loco parentis to the child and therefore be entitled to FMLA leave to care for the child if the child had a serious health condition. The same principles apply to leave for the birth of a child and to bond with a child within the first 12 months following birth or placement. For instance, an employee who will share equally in the raising of a child with the child’s biological parent would be entitled to leave for the child’s birth because he or she will stand in loco parentis to the child. Similarly, an employee who will share equally in the raising of an adopted child with a same sex partner, but who does not have a legal relationship with the child, would be entitled to leave to bond with the child following placement, or to care for the child if the child had a serious health condition, because the employee stands in loco parentis to the child.

The fact that a child has a biological parent in the home, or has both a mother and a father, does not prevent a finding that the child is the “son or daughter” of an employee who lacks a biological or legal relationship with the child for purposes of taking FMLA leave. Neither the statute nor the regulations restrict the number of parents a child may have under the FMLA. For example, where a child’s biological parents divorce, and each parent remarries, the child will be the “son or daughter” of both the biological parents and the stepparents and all four adults would have equal rights to take FMLA leave to care for the child. Where an employer has questions about whether an employee’s relationship to a child is covered under FMLA, the employer may require the employee to provide reasonable documentation or statement of the family relationship. A simple statement asserting that the requisite family relationship exists is all that is needed in situations such as in loco parentis where there is no legal or biological relationship.

The DOL letter provides examples of situations in which an in loco parentis relationship may be found, including where a grandparent takes in a grandchild and assumes ongoing responsibility for raising the child because the parents are incapable of providing care, or where an aunt assumes responsibility for raising a child after the death of the child’s parents. Such situations may, or may not, ultimately lead to a legal relationship with the child (adoption or legal ward), but no such relationship is required to find in loco parentis status. In contrast, an employee who cares for a child while the child’s parents are on vacation would not be considered to be in loco parentis to the child.

In sum, then, either day-to-day care or financial support may establish an in loco parentis relationship where the employee intends to assume the responsibilities of a parent with regard to a child. In all cases, whether an employee stands in loco parentis to a child will depend on the particular facts.

A decision earlier this week by a Federal District Court Judge here in Minneapolis offers some very useful guidance on accommodating requests for religious accommodations by employees. 

Celestica Corporation operates a manufacturing plant in Arden Hills.  Adecco USA provides temporary employees to Celestica.  The plaintiffs are practicing Muslims who allege that Celestica discriminated against them by failing to accommodate their religious duty to pray five times each day.  In particular, Celestica permitted employees to take unscheduled breaks for personal reasons (such as to use the bathroom), but did not permit plaintiffs to take unscheduled breaks to pray.  Celestica instead argued that it offered the employees a reasonable accommodation by giving them the opportunity to transfer to a different shift which would be more amenable to pray breaks. 

 The Court first found that Celestica’s proposed accommodation — allowing the Muslim employees to transfer to the first shift — would not necessarily have resolved the conflict because different employees had different believes about when they were required to pray.  “Given the variance in the religious beliefs at issue in this case, the Court cannot conclude that, because the first-shift employees may be satisfied with their schedule, an offer to transfer to the first shift would have fully resolved the religious conflict for each of the plaintiffs in this lawsuit.”  While also recognizing that a company is not required to offer an accommodation that completely eliminates the conflict, the Court decided that the reasonableness of Celestica’s proposed solution was a factual issue that it could not decide at this stage of the case.    (In fact, as the Court recognized, an accommodation may be reasonable even if it does not completely eliminate the employee’s religious conflict.) At trial, Celestica could still argue that the proposed accommodation would result in an unreasonable hardship.

 The Court also offered guidance on how a jury might decide whether a proposed accommodation was reasonable:

“It turns on fact-intensive issues such as work demands, the strength and nature of the employee’s religious conviction, the terms of an applicable CBA, and the contractual rights and workplace attitudes of co-workers. Bilateral cooperation under Title VII requires employers to make serious efforts to accommodate a conflict between work demands and an employee’s sincere religious beliefs. But it also requires accommodation by the employee, and a reasonable jury may find in many circumstances that the employee must either compromise a religious observance or practice, or accept a less desirable job or less favorable working conditions.”

 The Court did offer some rules for determining whether a given accommodation is reasonable. For example:

• An employer is not required to deprive other employees of their contractual rights in order to accommodate an employee’s religious needs.
• An employer is required to offer a reasonable accommodation, not the accommodation preferred by the employee. Thus, if the employer has offered one reasonable accommodation, the employee cannot insist on a different reasonable accommodation, even if the preferred accommodation would not inflict undue hardship on the employer.
• An accommodation may be reasonable even though it imposes some costs on the employee.  At the same time, the extent of and justification for the costs imposed on the employee are relevant to the reasonableness of the employer’s efforts to accommodate.  
• An accommodation might be unreasonable if it imposes a significant work-related burden on the employee without justification.  However, if  there are two possible accommodations, neither of which would impose any cost whatsoever on the employer, but one of which would inflict such drastic personal hardship on the employee that the employee could not possibly accept it. In such a case, the employer’s decision to offer the accommodation that inflicts drastic personal hardship — with no corresponding benefit to the employer — would not seem “reasonable.”
• The reasonableness of any accommodation also depends on the nature of the employee’s religious beliefs and how they conflict with the employee’s work duties.

In summary the Court indicated that what is “reasonable” is difficult to boil down to a set formula. Instead, the determination of reasonableness is quintessentially a fact-bound inquiry that depends on the unique circumstances of each case.  Of course, this makes it more difficult for defendants to obtain summary judgment on this type of case, and easier for plaintiffs to get their case in front of a jury.

Here is a link to a good article by two lawyers from Atlanta, Benjamin Flink and Anne Andrews, on how to protect your confidential information and customer relationships in this age of data mobility.  While it mostly focuses on Georgia law, the article provides some good practical suggestions/reminders, including using confidentiality agreements with employees; instituting good computer use policies; restricting access to sensitive information; conducting inventories for departing employees; and instituting remote access policies.

I will be speaking on this exact topic with Gary Eidelman from Saul Ewing in Baltimore at the Upper Midwest Employment Law Institute next Monday.  Come and learn more!

Supporters of such laws say they are necessary because an increasing number of employers are doing credit checks even though there is no proof that bad credit is a marker of risky employees.  They say the practice unfairly injures the huge pool of people whose credit was damaged by layoffs, medical bills or other factors beyond their control. They also say it disproportionately screens out minorities.  “Bernie Madoff had a pretty good credit score,” said Matthew Lesser, a Connecticut state representative.

The limited research on the topic seems to support the new laws.  Even a spokesman for one of the credit reporting companies acknowledges that there is no research to show any statistical correlation between what’s in somebody’s credit report and their job performance or their likelihood to commit fraud.

Advice to employers:  only use credit report history when there is some correlation between that information and the position in question, such as those that regularly handle money.  And only use the credit report as one factor among several in evaluating candidates.

A class action filed in New York yesterday alleges that the management consulting firm Accenture discriminates against African Americans and Latinos in the way it conducts its background checks.   In particular, it alleges that Accenture has rejected or fired otherwise  qualified individuals who have criminal records even where the criminal history has no bearing on the individual’s fitness or ability to perform the job.

According to the Complaint, “Such policies and practices are illegal because they adopt and perpetuate the racial disparities in the American criminal justice system … For decades, the Supreme Court and the EEOC have recognized that overly broad restrictions on hiring individuals with criminal records are discriminatory and illegal.”

The teaching here is clear: employers should avoid blanket criminal record policies.  Where a background check reveals a prior conviction, consider whether it would affect the applicant’s ability to perform the job.  For instance, a conviction for embezzlement would be a concern for a bank teller position; a conviction for jay walking would not. You should also consider how old the conviction is, and evidence of rehabilitation.  In the end, you need to be able justify the rejection of an applicant by pointing to legitimate business reasons for doing so.

Two other points:  make sure that background checks are being used and interpreted consistently across the company.  And focus on convictions, not on arrests.

For more guidance, check the EEOC’s website.

This recent article in the New York Times should remind us that employers can get themselves into trouble by offering “unpaid internships” that are not really internships.  Agencies in several different states have investigated the use of internships and have, in some cases, fined employers who are actually using the interns to provide unpaid labor.  As one official at the federal Department of Labor suggested:  “If you’re a for-profit employer or you want to pursue an internship with a for-profit employer, there aren’t going to be many circumstances where you can have an internship and not be paid and still be in compliance with the law.”

 In order for the “intern” to qualify as an unpaid “trainee” and not an “employee” (who must be paid), six criteria must be met:

 1. The training received, even though it includes actual operation of the facilities of the employer, is similar to what would be given in a vocational school or academic educational instruction;

 2. The training is for the benefit of the trainees;

 3. The trainees do not displace regular employees, but work under their close observation;

 4. The employer that provides the training derives no immediate advantage from the activities of the trainees, and on occasion the employer’s operations may actually be impeded;

 5. The trainees are not necessarily entitled to a job at the conclusion of the training period; and

 6. The employer and the trainees understand that the trainees are not entitled to wages for the time spent in training.

Most employers find that the fourth factor is the most difficult to meet because an intern’s activities will generally provide some benefit to the company.  Only if all of the factors listed above are met is the worker a “trainee” do the minimum wage and overtime provisions of the Fair Labor Standards Act not apply.  By contrast, the mere fact that an employer labels a worker as a trainee and the worker’s activities as training does not make the worker an intern or  trainee for purposes of the FLSA unless the six factors are met.

 I recommend that any employer that uses interns use a written agreement setting out these six factors, and designate a manager to ensure that each factor is being met.

And does anyone think that Ross is really an intern on the Tonight Show?

A decision this week by New Jersey’s Supreme Court adds another layer to the ongoing debate over employee’s right to privacy within the workplace.   The Court concluded that an employee, Marina Stengart, could reasonably expect that e-mail communication with her lawyer through her personal, password-protected, web-based e-mail account would remain private, and that sending and receiving them using a company laptop did not eliminate the attorney-client privilege that protected them.   In addition, the Court held that the employer’s lawyer violated the rules of professional conduct by reading Stengart’s e-mails. 

Underlying Facts: 

While employed by Loving Care Agency, Ms. Stengart  was provided with a laptop computer to conduct company business. From the laptop, she could send e-mails using her company e-mail account; she could also access the Internet through Loving Care’s server. Unbeknownst to Stengart, browser software automatically saved a copy of each web page she viewed on the computer’s hard drive in a “cache” folder of temporary Internet files. Stengart used her laptop to access a personal, password-protected e-mail account on Yahoo’s website, through which she communicated with her attorney about her situation at work. She never saved her Yahoo ID or password on the company laptop. Not long after, Stengart left her employment with Loving Care and returned the laptop. In February 2008, she filed the pending complaint.

In anticipation of discovery, Loving Care hired experts to create a forensic image of the laptop’s hard drive, including temporary Internet files. Those files contained the contents of seven or eight e-mails Stengart had exchanged with her lawyer via her Yahoo account. At the bottom of the e-mails sent by Stengart’s lawyer, a legend warns readers that the information “is intended only for the personal and confidential use of the designated recipient” of the e-mail, which may be a “privileged and confidential” attorney-client communication.

Attorneys from the law firm representing Loving Care reviewed the e-mails and used the information in discovery. Stengart’s lawyer demanded that the e-mails be identified and returned. The Firm disclosed the e-mails but argued that Stengart had no reasonable expectation of privacy in files on a company-owned computer in light of the company’s policy on electronic communications, which states that Loving Care may review, access, and disclose “all matters on the company’s media systems and services at any time.” It  also states that e-mails, Internet communications and computer files are the company’s business records and “are not to be considered private or personal” to employees. It goes on to state that “occasional personal use is permitted.”

Legal Analysis:

After first counseling that these types of cases must be decided based on their unique fact, the Court concluded that regardless of an employer’s written policies, an employer has no right to retrieve and read an employee’s attorney-client communication which is sent through a personal, password-protected e-mail account, even where the employee uses the company’s computer system.   “ Under all of the circumstances, Stengart could reasonably expect that e-mails exchanged with her attorney on her personal, password-protected, web-based e-mail account, accessed on a company laptop, would remain private. By using a personal e-mail account and not saving the password, Stengart had a subjective expectation of privacy. Her expectation was also objectively reasonable in light of the ambiguous language of the Policy and the attorney-client nature of the communications.”

In concluding that the attorney-client privilege protected the e-mails, the Court also rejected the claim that the attorney-client privilege was waived. The Policy did not give Stengart, or a reasonable person in her position, cause to anticipate that Loving Care would be watching over her shoulder as she opened e-mails from her lawyer on her personal, password-protected Yahoo account. Similarly, Stengart did not waive the privilege as she took reasonable steps to keep the messages confidential and did not know that Loving Care could read communications sent on her Yahoo account.  In fact, the Court concluded that even a policy that provided unambiguous notice that an employer could retrieve and read an employee’s attorney-client communications, if accessed on a personal, password-protected e-mail account using the company’s computer system, would not be enforceable.

Bottom Line:

While employers should adopt and enforce policies relating to computer use to protect the assets and productivity of a business, but they have no basis to read the contents of personal, privileged, attorney-client communications.

Employers of a “qualified employee” are excused from paying the employer’s portion of Social Security taxes on that employee’s wages in 2010. A qualifying employee is one who (a) is hired after February 3, 2010 and before January 1, 2011; (b) does not replace another employee; (c)  is not related to the employer;  and (d) certifies under penalty of perjury that he or she has not been employed for more than 40 hours during the 60-day period ending on the date that employment begins with the new employer.

This incentive can save the employer up to $6,621.60 for each qualified employee hired (6.2% of the maximum Social Security withholding for 2010), with increased savings for hiring qualified veterans, whose maximum Social Security withholding amount is higher. Employers also can receive a tax credit on their 2011 return for each new employee hired and retained for 52 weeks under certain criteria; that credit is the lesser of $1,000 or 6.2% of the wages paid to the employee for those 52 weeks.

The text of the new bill may be found here.