News for March 5, 2018

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

En banc court says sexual orientation discrimination is 'because of' sex under Title VII
Sitting en banc, a divided Second Circuit reversed course and held that Title VII prohibits sexual orientation discrimination. It explained that sexual orientation discrimination is a subset of sex discrimination because it is defined by one's sex in relation to the sex of those to whom one is attracted. The court further concluded that sexual orientation discrimination is based on gender stereotypes, including to whom an employee should be attracted, and constitutes associational discrimination because it is motivated by opposition to association between members of certain sexes. The court therefore vacated summary judgment against a Title VII claim by an employee allegedly fired because he is gay. (Zarda v Altitude Express, Inc dba Skydive Long Island, 2ndCir, February 26, 2018, Katzmann, R.)

Manager's animus may have tainted investigation but after-acquired evidence capped employee's recovery
An African-American IT employee fired for a purported security breach defeated summary judgment on his Title VII retaliation claim since triable issues existed as to whether the investigation into his conduct was tainted by the retaliatory animus of his manager, who had been increasingly scrutinizing his work ever since he filed an internal bias complaint and EEOC charge. However, his potential recovery was limited by after-acquired evidence that he was dishonorably discharged from the army and served five years in the stockade for killing someone in a bar fight, but represented on his application that he had never been "convicted of any crime(s)." Granting in part the employer's motion for summary judgment, a federal magistrate judge in Alabama rejected his assertion that a court martial isn't a criminal conviction. (Jones v UAB Health System, NDAla, February 15, 2018, Cornelius, S.)

Employee who requested third leave, with specific end date, was not a qualified individual
Neither the ADA nor FEHA required an employer to extend an employee's medical leave indefinitely until she was able to return to work, a federal court in California explained, granting summary judgment against the federal and state-law disability claims of an employee with a broken ankle who argued that additional leave, as set out in her third doctor's note stating she would be temporarily disabled through a specific date, was a reasonable accommodation. Summary judgment was also granted in favor of a second defendant that, the employee alleged, jointly employed her. (Ruiz v Paradigmworks Group, Inc, SDCal, February 22, 2018, Bencivengo, C.)

Jury to decide if harassing conduct was unwelcome
Despite evidence that a female foreman—the only female working in the field for a large construction company—initially engaged in "off-color banter" with male coworkers, text-messaged with them, and even after she was fired texted with or posted on Facebook with them, there was enough contrary evidence that the constant sexualized environment gradually took a toll on her and that she eventually communicated her opposition to it that a federal district court in Tennessee would not grant summary judgment to her employer. In so ruling, the court also refused to strike her affidavit in opposition to summary judgment as a sham, finding it a legitimate effort to supplement the record and generally consistent with her prior deposition testimony. There were disputed material issues of fact as to whether the harassing behavior was unwelcome, how and when the employee objected to it, and whether she failed to take advantage of the company's sexual harassment policy. Her intentional infliction of emotional distress claim failed as a matter of law because the court found it, "unfortunately, not atypical of the fact pattern presented in most harassment cases." (Cossairt v Jarrett Builders, Inc, MDTenn, February 20, 2018, Crenshaw, W., Jr.)

SIFL rates issued for the first half of 2018
The Department of Transportation has released the applicable terminal charge and standard industry fare level (SIFL) mileage rates for January 1, 2018 through June 30, 2018. These rates will be used by the IRS to determine the value of noncommercial flights on employer-provided aircraft.

Research reveals employers moving from traditional severance policies to more flexible arrangements
There are major changes afoot in severance and separation benefits that will dramatically impact employer brand and talent management, according to a survey conducted by Lee Hecht Harrison. Among the major findings is that severance remains the method-of-choice for organizations concerned with protecting employer brand: almost all businesses (97 percent) in the study said they offer some form of severance.

Survey shows average worker spends six hours on sports-related activities during March Madness
Employees are mad about sporting events like March Madness, suggests a new survey from OfficeTeam. Professionals said they spend an average of 25.5 minutes per day on sports-related activities in the office during the college basketball playoffs. With the tournament spread across 15 workdays, that's the equivalent of six hours per employee.

Employees prioritize setting their own schedule above every other workplace perk
Flexible work hours are the perk that influences employee satisfaction the most, according to a new survey by Clutch, a B2B research firm. More than 40 percent of the full-time U.S. employees surveyed say that flexible hours are the most important perk they receive, and over half (54 percent) say it's the perk that matters most to their job satisfaction.

In state law news:

20 states seek repeal of entire 'unconstitutional and irrational' ACA
Twenty states filed a lawsuit against the federal government challenging the constitutionality of what remains of the Patient Protection and Affordable Care Act (ACA) after the Tax Cuts and Jobs Act of 2017 eliminated the individual mandate's tax penalty only. With no remaining legitimate basis for the ACA, said the states in their complaint, the remainder of the law, which "forces an unconstitutional and irrational regime" on the states and their citizens, must also fall.

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Special Report

Supreme Court narrows law governing retaliation against whistleblowers-but ruling may hurt employers in the long run

On February 21, 2018, the U.S. Supreme Court issued its ruling in Digital Realty Trust, Inc. v. Somers, resolving a disagreement among the Second, Fifth and Ninth Circuit Courts of Appeals and the Securities and Exchange Commission concerning the scope of Dodd Frank's anti-retaliation provisions applicable to "whistleblowers." Prior to this decision, the Second and Ninth Circuits (through judicial opinions) and the SEC (through rule-making) had interpreted Dodd Frank's anti-retaliation provisions broadly to apply to individuals who did not provide information regarding violations directly to the SEC. The Supreme Court unanimously rejected this expansive interpretation as inconsistent with the text of Dodd-Frank. Now, whistleblowers are required to report violations of law to the SEC, and not just to their employers, in order to qualify for whistleblower protection under Dodd-Frank's anti-retaliation provisions.

It is important to note that the Somers decision will further incentivize whistleblowers to report to the SEC and will surely discourage some individuals from reporting only internally, thus allowing for the possibility of the reported matter to be resolved without additional regulatory scrutiny.

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