Does Healthcare Reform Have A Future?

I suppose it is a mark of the times that health care reform has long ceased to be a public policy debate about the state of health care in America.  Instead, it marks the latest dividing line between opposing visions of what America is and what it ought to be.  To those opposed, Obamacare represents an existential threat to the continued existence of the prototypical self-reliance individualism that defines the “true” American.  To those convinced that “social justice” demands that our society provide what can be the most basic of human needs, the Affordable Care Act, passed by the legerdemain of an ascendant Democratic Party, remains a fundamental step toward erasing inequality of every kind in America.  Both sides have a point.  The United States has indeed been populated by those who saw opportunity in many forms and sacrificed to take advantage of it to benefit themselves and their families.  On the other hand, Pilgrim settlers in New England sought religious refuge to create their own “City on a Hill” and America has never lacked for utopian ideas and those who believe in them.  Oddly, both points of view are quintessentially American. We want to reward hard work and risk taking and at the same time we recognize a civic to help others.

What is lost in this debate, however, is a more immediate concern. How do we solve the problems facing health care in America.  While it is indeed imperfect, the Affordable Care Act has sown seeds for improvement in what was a deeply flawed, was increasingly dysfunctional, expensive, and unworkable health care system.  We cannot simply revert to the world as it existed prior to the enactment of health care reform in 2010, and this point has so far escaped the notice of many caught up in today’s mindless political debate.

So, does health care reform have a future?  The answer:  Yes, but it is a hugely complex problem and it will be expensive, it will not be the most logical outcome, and it will only happen when those who elect our politicians tell them that something must be done to make it better.  The road will not be straight.

When Job Applicants Volunteer Union Membership

I recently provided some compliance counseling in a situation where an employer engaged in hiring laborers for a new construction project encountered applicants who brought up their union affiliation during the interview process or included union-specific content on their application materials.  Because the employer sensed he might be entering dangerous waters, he reached out for guidance.

The federal agency that determines whether an employer has committed an unfair labor practice is the National Labor Relations Board (NLRB).  When a labor union or union member believes that an employer has evaluated the suitability of job candidates according to their pro-union opinions, past union membership or interest in union organizing, the union or union member will often report that conduct to the NLRB and request an investigation.

The basic test the NLRB has developed for evaluating whether a pre-employment hiring process violates federal labor laws is whether, under all circumstances, the employer's process reasonably tends to restrain, coerce, or interfere with rights guaranteed by those laws.  For example, the NLRB has determined that questioning job applicants during interviews violates federal law when the questions are designed to generate information for the employer about pro-union opinions, past union membership or interest in union organizing, and when the interview includes threats of unfavorable consequences if the applicant engages in pro-union activity or has contact with union organizers.   Even in cases when the job applicant is hired, the NLRB can still determine that questions during the job interview concerning former union membership and union preference are unlawful.

The problem, of course, is that sometimes unions send their organizers -- known as “salts” -- to actually apply for jobs with an employer and, during the interview process, these persons openly announce that they are pro-union or intend to organize for the union while working.  The U.S. Supreme Court has held that even these persons must be treated like any other job applicant, without discrimination.

The following rules MUST be followed at all times by supervisors and all hiring personnel:

1. Do not ask applicants about union membership either on a form or during an interview.
2. Never tell union applicants that no jobs are open while running a help wanted ad or hiring off the street.
3. Never hire non-union applicants with little experience for skilled jobs, despite the fact that qualified union applicants are available.
4. Never tell union applicants that interviews or written applications are required while hiring other applicants without them.

It is important for supervisors and all hiring personnel to be aware of the basic rules of salting.  Your failure to respond properly can result in litigation against the employer, including severe financial damages and penalties.

"What if an applicant tells me during an interview that he or she is a union member without my asking?"

That should make no difference to your hiring practices. Just follow your normal procedures.  Do not respond negatively, angrily or critically when statements like that are made during an interview.  Your response to any reference to union membership or pro-union opinions should be, "It is our practice to hire the best qualified applicants.  We give no preferential treatment to anyone nor do we discriminate against anyone on the basis of their union membership."

FLSA: Employer Liability for Uncompensated Work Time

An employee who works through mandated lunch or meal breaks without recording the hours, and who is thus not compensated for all hours worked, can present a thorny issue for the employer, as the employer is exposed to a Fair Labor Standards Act claim for failing to pay for the work performed.  Resolution of the employee’s claim for compensation for missed lunch or meal breaks will turn on whether the employer knew or should have known of the uncompensated work; if the employer allowed it to happen, the employee must be compensated. FLSA regulations are clear about this:  (1) “work not requested but suffered or permitted is work time.”  (29 C.F.R. § 785.11); and (2) if the “employer knows or has reason to believe that [a worker] is continuing to work [then] the time is working time.”(29 CFR § 785.11).

It is easy to say that if the employer does not know or have reason to know that the employee is working uncompensated hours the employer is not liable under the FLSA, but it can be difficult to prove this negative.  A written policy requiring employees to report all work time and to report missed breaks, and making payment to those employees who make such reports, is one way an employer can ensure that it pays employees for all time worked and is not subjected to liability for uncompensated work.  This was confirmed earlier this month when the United States Supreme Court declined to hear an appeal from a decision by the Sixth Circuit Court of Appeals ruling for the employer.

In White v. Baptist Memorial Health Care Corp., 699 F.3d 869 (6th Cir. 2012), the Court granted summary judgment for the employer, basing its decision on the employer’s written policies and the employee’s failure to comply with the policies.   The written policy in the employer’s handbook provided that employees were entitled to unpaid meal breaks that were automatically deducted from the paycheck and also provided that if an employee missed a meal break or the meal break was interrupted for a work-related reason, the employee would be compensated for the time worked.  The employees were instructed to record on a log all of their time spent working.  Ms. White signed a document indicating she understood the policy.  For a time she completed the log (and was paid for the missed breaks) but she then stopped doing so and later claimed she should be paid for the time worked during the meal breaks that were deducted from her paychecks.
 
The bottom line from the White case is if an employer establishes a reasonable process for an employee to report uncompensated work time and the employee fails to follow the process, it is unlikely the employer will be liable.  A different result could occur if there was evidence the employer discouraged employees from following the process, but short of that it is unlikely a court would hold an employer liable when it had no way of knowing the employee was working uncompensated hours.

U.S. Supreme Court Considers Age Discrimination Claims Under the Equal Protection Clause of the Constitution

Last week the United States Supreme Court opened its 2013-2014 session with oral argument in a case involving whether state and local government employees may avoid the Federal Age Discrimination and Employment Act remedial scheme by instead bringing age discrimination claims directly under the Equal Protection Clause of the Constitution and 42 U.S.C. § 1983.  ADEA claims are brought against an employer, while § 1983 claims are brought against individual government actors.  The damages that can be recovered differ as well.  The Seventh Circuit in Levin v. Madigan grabbed the Supreme Court’s attention when it ruled that a former Senior Assistant Attorney General in Illinois was not bound by the ADEA and was allowed to pursue an action against various Illinois state officials for age discrimination under § 1983.  This ruling is contrary to the holdings of several other circuit courts, including the First Circuit, which covers, among other states, all of Northern New England.

Complicating the case is that the issue seems to have been framed in terms of whether or not an individual with an ADEA claim is precluded from bringing a § 1983 claim (the Seventh Circuit said no).  In the case before the Supreme Court, the individual plaintiff himself was not even eligible to bring a claim under the ADEA because he fell under an exemption from coverage for certain government officials in policy-making positions.

Though a decision could be months away, the Court’s ruling may significantly impact state and local governments’ ability to defend age discrimination claims.  If the Supreme Court adopts the rationale of the Seventh Circuit, then municipal and state governments in Northern New England can expect to see a likely increase in the complexity and scope of age discrimination claims.

First Circuit Enforces Non-Solicitation Agreement in Favor of Employer

Can a former employee circumvent a non-solicitation agreement if he or she merely accepts business from former customers and does not actively solicit them?  Recently, in a decision sure to please employers, the First Circuit Court of Appeals said no—not if the employee plays a role in “piquing” the customers’ curiosity and “inciting” their initial contact.

In Corporate Technologies, Inc. v. Harnett, an account executive argued that he was not in breach of a non-solicitation agreement because the customers in question had initiated contact with him, not vice-versa.  Rejecting this argument, the First Circuit found that the identity of the person making initial contact was not determinative and that it was simply one fact to be considered along with many others.  In this case, the “other facts” included a blast email that the account executive had sent to a targeted group of prospective clients, including the customers in question, announcing his new job at a competing business.  Notably, the customers reached out to the account executive only after they received the email.  The First Circuit found that this targeted email, which was designed to “pique customers’ curiosity,” clearly crossed the line from mere acceptance of business to active solicitation. 

The result in Corporate Technologies is good news for employers.  Although the decision makes clear that employees are entitled to make public announcements of changes in employment, it also makes clear that employees may not use those announcements in creative ways to circumvent valid non-solicitation agreements.

Authored by Kevin Haskins, attorney with Preti Flaherty's Employment Law Practice Group.  For more information on employment related matters, contact Kevin at 207-791-3076 or a member of the Employment Law Group.