News for August 20, 2018

Featured this week: In state law news:
Featured this week:

Suspicious explanations, ageist comments, younger replacement support revival of age-bias claim
A college's insufficient and inconsistent explanations for a professor's discharge, along with evidence that he was replaced by someone younger and that a supervisor directly involved in the decisionmaking process made repeated discriminatory remarks about older workers, provided sufficient evidence to create a triable issue as to pretext, the D.C. Circuit ruled in reversing dismissal of the professor's age discrimination lawsuit on summary judgment. While a reasonable jury might ultimately find in favor of the college, which claimed it discharged the professor due to budgetary constraints and performance issues, it might also credit the professor's version of events and find in his favor. (Steele v Mattis, DCCir, August 10, 2018, Millett, P.)

Offensive comments, including by investigator, support hostile work environment claims
The many sexually offensive comments made to a female police officer, as well as the fact that the investigator assigned by the department to look into her harassment claim had himself been accused of making offensive comments, supported the employee's claims for a hostile work environment and retaliation, held a federal district court in Michigan, denying in part the employer's summary judgment motion. The court also found the department could be vicariously liable for the behavior of the police officer's coworkers and supervisors because although a policy against sexual harassment existed, supervisors were complicit, participated in, and maintained the hostile work environment. The employee's retaliation claim could go forward as well because a reasonable employee could find the substance of the investigation and the choice of whom to lead it was materially adverse. The employee's sex discrimination claim failed however, because her job duties and benefits remained the same after the investigation. (Brown v City of Allen Park, EDMich, August 13, 2018, Edmunds, N.)

Cat's paw theory applies; supervisor who knew of employee's disability provided input into termination
An employee's failure to accommodate and disability discrimination claims could go forward because a supervisor who knew of his vision disability (deteriorating retinas) provided input into the decision to terminate him, held a federal district court in Oregon. Although the ultimate decisionmakers were unaware of the employee's disability, they relied in part on input from his direct supervisor, who knew of the disability. In addition, the employee was targeted for termination based partly on his failure to consistently use the required sales tracking software, but his vision problems hindered him from using it as intended. He had requested an accommodation, but did not receive one. Therefore, identifying him as a poor performer based on his non-use of the software was effectively based on his vision problems and was discriminatory. However, the court granted summary judgment in the employer's favor on the employee's FMLA and parallel state-law claims; although he was discharged after requesting medical leave, the termination decision had been made and documented a month before his leave request. (Larson v Oregonian Publishing Company LLC, DOr, August 13, 2018, Acosta, J.)

'Honest belief' employee filed false harassment claim conflicts with summary judgment standard
Although an employer is protected under the "honest belief" rule even if its conclusion that an employee engaged in misconduct was incorrect, claims against an employer here could go forward because the reasonableness of its belief that an employee filed a false sexual harassment complaint could not be determined without ascertaining the credibility of the employee or the alleged witnesses to the misconduct, held a federal district court in Tennessee. Because credibility determinations were required, the case could not be decided before trial. The court noted that the case was particularly unusual because the employer admitted that it fired the employee because she filed the sexual harassment complaint. It asserted that the complaint was false (and it was protected under the honest belief rule because it believed the employee was lying), while the employee asserted that the complaint was true and the employer's claim that it was false was a pretext. The only evidence of the employer's position was testimony from witnesses and the employee had presented some evidence of flaws in their statements. Because at summary judgment, the court is required to infer that the employee's complaint was true, it could not determine whether the honest belief rule protected the employer and the claims went forward. (EEOC v HP Pelzer Automotive Systems, Inc, EDTenn, August 3, 2018, Varlan, T.)

Cost to provide health benefits nears $15,000 per employee
With the cost to provide health care benefits expected to approach $15,000 per employee next year, large U.S. employers are increasingly playing an activist role in changing the health care delivery system and reexamining existing models, according to recent research from the National Business Group on Health (NBGH). The survey also found a majority of employers believe virtual care and technology will play a major role in how health care is delivered in the future and that new entrants will be necessary to disrupt the market in a positive way.

Survey shows organizations planning to modernize compliance in year ahead
Almost half (48.3 percent) of risk and compliance, internal audit, C-suite executive and board professionals plan to modernize their compliance functions by changing core compliance execution practices during the next 12 months, according to a recent Deloitte poll. Further, resource levels for compliance teams are expected to increase (27.5 percent) or stay flat (37.6 percent) in the year ahead for the majority of organizations.

Mercer survey shows employers not budging on budgets, salary increases remain flat
Organizations are holding the line on pay raises for U.S. employees. According to Mercer's 2018/2019 U.S. Compensation Planning Survey, salary increase budgets for 2018 are 2.8%—no change from 2017—and projected to be only 2.9% in 2019, despite noticeable factors like the tightening labor market and a high rate of workers voluntarily quitting their jobs.

CPI for all items rises 0.2% in July as shelter index rises
The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in July on a seasonally adjusted basis after rising 0.1 percent in June, the U.S. Bureau of Labor Statistics reported August 10. Over the last 12 months, the all items index rose 2.9 percent before seasonal adjustment.

Real average hourly earnings unchanged over the month in July
Real average hourly earnings for all employees were unchanged from June to July, seasonally adjusted, the U.S. Bureau of Labor Statistics reported August 10. This result stems from a 0.3-percent increase in average hourly earnings combined with a 0.2-percent increase in the Consumer Price Index for All Urban Consumers (CPI-U).

In state law news:

Massachusetts adopts Uniform Trade Secrets Act
On August 10, Massachusetts Governor Charlie Baker signed into law a bill that adopted the Uniform Trade Secrets Act (UTSA), leaving New York as the only state without some version of the uniform act.

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Special Report

Guidance issued in Pennsylvania says sex discrimination includes sexual orientation and gender identity bias

In its recently released guidelines for handling discrimination complaints based on sex under the Pennsylvania Fair Educational Opportunities Act (PFEOA), the Pennsylvania Human Relations Commission (PHRC) has clearly stated its position that sex discrimination under both the PFEOA and the Pennsylvania Human Rights Act (PHRA) includes discrimination based on sexual orientation, transgender identity, gender transition, gender identity, and gender expression. This is no small development—Pennsylvania now joins Michigan as the second state to recognize "sex" discrimination as including sexual orientation and gender identity discrimination under state employment law, according to Chicago-Kent Law Professor Anthony Michael Kreis.

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