Workplace Prof Blog

More Post-Dukes Class Action Rulings

The Seventh Circuit issued an opinion last week applying Wal-Mart v. Dukes in a class action under the Fair Labor Standards and Illinois Minimum Wage Acts. In Ross v. RBS Citizens, the district court had certified two classes: 1. all current and former hourly employees made to work more than forty hours a week pursuant to an unofficial policy; and 2. all current and former assistant branch manager employees who claimed they were misclassified as exempt employees and made to work more than forty hours a week.

The Seventh Circuit affirmed the certification as not an abuse of discretion. The employer had argued that the classes lacked commonality as interpreted by the Supreme Court in Dukes. The Seventh Circuit distinguished Dukes in a number of ways in affirming the district court's certification. In this case, the classes constituted only about 2000 employees from Illinois only, and there were a large number of affidavits supporting the claims. And the legal question of an unofficial policy did not require individual determinations of motive, unlike discrimination claims. Finally, there was no conflict, either, between a statement of official policy and the unofficial policy alleged by the plaintiff classes to have injured them.

With very few of these Courts of Appeal applications of Dukes, this adds another important development in where class actions will go from here.

MM

A Future Supreme Court Case on Public E-Mail Privacy?

OK, so it's a bit early to be predicting Supreme Court cert., but if I were a privacy advocate, I'd be pushing hard on this case as a possible vehicle for the Court.  The reason are the facts:  mainly that the FDA engaged in substantial monitoring of employee e-mails to Congress regarding the employees' whistleblowing about their allegations that the FDA was approving unsafe devices.  According to the Washington Post:

The surveillance — detailed in e-mails and memos unearthed by six of the scientists and doctors, who filed a lawsuit against the FDA in U.S. District Court in Washington last week — took place over two years as the plaintiffs accessed their personal Gmail accounts from government computers.

Information garnered this way eventually contributed to the harassment or dismissal of all six of the FDA employees, the suit alleges. All had worked in an office responsible for reviewing devices for cancer screening and other purposes.

Copies of the e-mails show that, starting in January 2009, the FDA intercepted communications with congressional staffers and draft versions of whistleblower complaints complete with editing notes in the margins. The agency also took electronic snapshots of the computer desktops of the FDA employees and reviewed documents they saved on the hard drives of their government computers.

FDA computers post a warning, visible when users log on, that they should have “no reasonable expectation of privacy” in any data passing through or stored on the system, and that the government may intercept any such data at any time for any lawful government purpose.

There's more detail about the monitoring, which was quite robust, so check out the full article.  Obviously, there are issues about the extent to which the banner warning protects public employer monitoring and, a subset of that question, is whether on its own terms, the warning considers retaliatory purposes to be "lawful."  But the facts just sound bad for the agency, which shouldn't matter, but we all know does.

Of course, the main take-home point is what I tell my students every semester:  if you don't want your employer to see what you're doing on your computer, then don't do it at work.

-JH 

Recently Published Scholarship

• Ariana R. Levinson, Workplace Privacy and Monitoring: The Quest for Balanced Interests, 59 Cleveland St. L. Rev. 377 (2011).
• Monica Teixeira de Sousa, The State of Our Unions: How President Obama's Education Reforms Threaten the Working Class, 50 Louisville L. Rev. 201 (2011).
• William R. Corbett, What Is in GINA's Genes? The Curious Case of the Mutant-Hybrid Employment Law, 64 Okla. L. Rev. 1 (2011).
• Emily Eschenbach Barker, The Changing Face of Liberalism in Workplace Democracy: The Shift from Collective to Individual Rights, 36 Vermont L. Rev. 303 (2011).
• Heather M. Kolinsky, Taking Away an Employer's Free Pass: Making the Case for a More Sophisticated Sex-Plus Analysis in Employment Discrimination Cases, 36 Vermont L. Rev. 327 (2011).

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Call for Papers: LLRN Conference in Barcelona

Labour Law Research Network will hold its inaugural conference at Pompeu Fabra University, Barcelona, June 14-15, 2013.

LLRN was established in 2011 by 30 research centres from all over the world dedicated to the study of labour law. One of the objectives of the LLRN is to hold regular international conferences that will be entirely academic (dedicated to the presentation and discussion of original papers); entirely about labour law (broadly conceived); and will allow cutting-edge topics to surface from the participating scholars themselves, in a non-hierarchical way.

Proposals are being invited of:

• Abstracts: scholars interested in presenting papers at the conference are invited to submit an abstract of up to 500 words. Please include a title, your name and affiliation and contact information.
• Sessions: scholars are also welcome to submit proposals for full sessions, which include 3-4 papers and a discussant. Such proposals should be submitted by the organizer of the session (who will also serve as the chair), and include abstracts of all proposed papers as well as a short integrative statement explaining the theme of the session (all in one file).
• Book Symposiums: scholars who wish to organize a discussion around a recent important labour law book are invited to propose a session with 3-4 discussants and the book author as a respondent. Proposals for book symposiums do not require abstracts, just a short explanation of the book's importance and brief bios of the discussants who agreed to take part.   
• Research Centres Showcase Panels: labour law research centres are invited to propose sessions in which their research projects will be presented and discussed. The exact plan for such sessions is open for discussion with the organizing committee.

Important dates:

• October 15, 2012    Last day to submit abstracts/session proposals
• December 15, 2012    Decisions on acceptance of papers/sessions    
• May 15, 2013        Last day to submit full papers
• June 14-15, 2013    Conference

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Execs Skimp on Pension Payments to Pad Their Own Pockets

We've reported before on the underfunding of public and private pensions.  An article in The Economist points out that some of the same private-sector companies underfunding their pensions also are engaging in share-buyback schemes.  Why? Because share buybacks artificially inflate the company's stock price (it reduces the supply of stock without the need for improved company performance) and thereby justify high executive compensation and bonuses.  Meanwhile, the same companies are assuming an unrealistic 10% rate of return on investments in pension funds -- even though top executives as a group forecast equity returns of 6.3%. Good deal for corporate execs; bad deal for rank-and-file employees.

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Trio of 4th Circuit Employment Cases

Jon Harkavy (Patterson & Harkavy) sends word of three important cases issued over the last couple of days by the Fourth Circuit.  The descriptions below are Jon's:

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• EEOC v. Great Steaks holds that a district court's denial of fees to a prevailing defendant in an EEOC enforcement action was not an abuse of discretion.  The degree of deference shown to the district court that managed the case seems paramount in Judge Floyd's reasoning for the unanimous panel.
• Minor v. Bostwick Laboratories (copy attached) decides that an intra-company FLSA complaint may be considered protected under the statute's anti-retaliation provision.  Judge Duncan, writing for a unanimous panel, concludes that while [the Supreme Court's] Kasten's holding does not control determination of this issue, its reasoning compels the decision here.
• Jafari v. Old Dominion Transit Management is an unpublished FLSA retaliation case raising the same issue, among others.

Italian Labor Law Prof Receives Death Threats

Dennis Nolan passes along this article from Bloomberg describing how a labor law professor in Italy, who has advocated for reform of Italy's stringent labor laws, is receiving death threats:

In just about any other country in the world, Pietro Ichino’s biggest career liability would be finding himself alone in a corner at cocktail parties. Ichino is a professor of labor law. In Italy, that means his life is under threat. For the past 10 years, the academic and parliamentarian has lived under armed escort, traveling exclusively by armored car, and almost never without the company of two plainclothes policemen. The protection is provided by the Italian government, which has reason to believe that people want to murder Ichino for his views.

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Rep. Miller Requests Justice Department Investigation of Member Hayes

Rep. Miller (D-Cal.) has submitted a request to the Justice Department to investigate contacts that NLRB Member Hayes had with a potential employer (the announcement is here and request is here).  This follows the release of a report by the NLRB Inspector General, which looked into both the contact and a letter that Member Hayes sent to the Chair of the House Education and the Workforce Committee (Miller is the senior Democrat on the committee) that alleged improprieties in the Board's handling of the election rulemaking process.

The matter involving the firm, Morgan Lewis, doesn't seem too troubling to me.  There appeared to be only limited contact that involved something comments such as "if you ever decide to resign, we'd like to talk to you."  The Morgan Lewis attorney said he or she shouldn't talk anything more specific until he stated an intent to resign and Member Hayes both contacted an Ethics Program Officer and put a recusal on any cases involving the firm.

Although not part of Miler's request, the findings on Hayes' letter seem more problematic.  The IG found that there was no evidence of unlawful conduct (because the relevant statute prohibits only "material" falsehoods), but what seems clear is that Member Hayes made a very public and harsh accusation against other Board members that, at a minimum, was based on incomplete information and that possibly (I emphasize "possibly") included outright lies by either him or someone working for him. 

The relevant parts of Hayes' letter to the Chair of the House Education and the Workforce Committee are copied below.  The IG essentially found that the letter overall was merely an opinion, while these factual statements were not true.  The report suggests that Hayes' staff did not provide him with accurate information and even notes that he should consider whether any "administrative action" is warranted.  What is a bit perplexing is that the IG finds a lack of materiality because the incorrect statements were not used to explain the basis for his opinion in the letter.  Although these aren't the only things cited in Hayes' letter, I'm having a hard time seeing how they aren't at least some of the bases for his opinion.  What I don't know, however, is the jurisprudence on what is considered material under that statute, so perhaps the answer lies there.

Central statements reviewed by the IG:

The IG report finishes with the following paragraph, which speaks for itself:

-JH

The Election Rules Are Back

One big question when the NLRB adopted the pared down set of election rules was what the Board would do if/when it got more members.  Given that the recess appointments have happened, it's not a big suprise to think that the Board would try to move ahead in some fashion--which is exactly what Chairman Pearce has said will happen.  There's obviously going to be a political element to this, although I wonder how much more this matters given what labor proponents are already doing, even now that Boeing has gone away.  Of more interest to me is what the three new Board members will think about the proposals and possible news ones. I've mentioned before that I thought some of the dropped proposals made a lot of sense (like using e-mail where warranted), but there were still a lot of open questions (e.g., what to do about  blocking charge policy).  And, of course, there could be entirely new things put on the table.

My guess is that things will progress slowly for a while as the new members get settled in and finally get a chance to provide their input.  In fact, we could even be looking at an additional comment period if newp proposals are added.  Stay tuned . . . .

-JH

CEPR Report on Low Wage Work

The Center for Economic and Policy Research, a progressive economic thinktank, has issued a report on low wage work in rich countries. Low Wage Lessons compares the percentage of the workforce in low wage work, the strength of collective bargaining, and the level of social safety net, among other things, in developed countries. From the press release:

The experience of the United States stands primarily as a model for how not to succeed in reducing low-wage work. The United States has the lowest unionization rate among rich countries, a weak minimum wage, a stingy benefits system, and the highest rate of low-wage work among rich economies. About one-fourth of U.S. workers are in low-wage jobs, according to the standard international definition of low-wage work of earning less than two-thirds of the national median wage. (The median wage is the wage received by the worker exactly in the middle of the wage distribution.)

In the United States, the minimum wage and the Earned Income Tax Credit (EITC) are the two most important policies in place to fight low pay. But, the report argues that they have largely been ineffective.

"The minimum wage and the EITC could be excellent tools to fight low-wage work," [John] Schmitt[, the author of the report,] said, "but, they have been set far too low to make a difference."

The report also emphasizes that low pay is only the most obvious problem facing low-wage workers in the United States. Low-wage workers are also far less likely to have health insurance, paid sick days, paid family leave and other benefits that are common in higher-wage jobs.

And from the web summary of the report, 

Over the last two decades, high – and, in some countries, rising – rates of low-wage work have emerged as a major political concern. According to the Organization for Economic Cooperation and Development (OECD), in 2009, about one-fourth of U.S. workers were in low-wage jobs, defined as earning less than two-thirds of the national median hourly wage (see first figure below). About one-fifth of workers in the United Kingdom, Canada, Ireland, and Germany were receiving low wages by the same definition. In all but a handful of the rich OECD countries, more than 10 percent of the workforce was in a low-wage job.

If low-wage jobs act as a stepping stone to higher-paying work, then even a relatively high share of low-wage work may not be a serious social problem. If, however, as appears to be the case in much of the wealthy world, low-wage work is a persistent and recurring state for many workers, then low-wages may contribute to broader income and wealth inequality and constitute a threat to social cohesion. This report draws five lessons on low-wage work from the recent experiences of the United States and other rich economies in the OECD.

Lots of interesting data and analysis.

MM

NLRB GC Issues Report on Social Media Cases

NLRB Acting General Counsel Lafe Solomon has just released a Report of the Acting General Counsel on Social Media Cases.  This report describes the 14 cases the NLRB has seen recently.  You can follow this link to the Report or download it here.

Hat tip: Sharon Steckler (NLRB Region 16).

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Gould on the NBA Lockout

Bill Gould has just published, in Stanford Law Review Online, a retrospective on the 2011 NBA lockout.  Bill's take-away: "What appeared to be a rout of the players in November emerged as a reasonable face-saving compromise."  The article is The 2011 Basketball Lockout: The Union Lives to Fight Another Day—Just Barely.

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Fourth Circuit: State Courts Lack Jurisdiction over Title VII Claims

Jon Harkavy (Patterson & Harkavy) writes to tell us of Bullock v. Napolitano.  Rather than re-invent the wheel, I'll just post Jon's description of the case:

[The] Fourth Circuit ...decision of [Bullock v. Napolitano], issued Monday afternoon, [] effectively forecloses the ability of a federal employee to file a Title VII decision in state court.  Judge Niemeyer wrote the majority opinion based largely on Title VII's silence about a waiver of governmental immunity in state court suits.  Judge Gregory wrote a dissent that provoked a somewhat pointed rejoinder by footnote in the majority opinion.  The issue may be cert-worthy, especially if other circuits have disagreed with the majority.  In any event, I thought readers of the blog (and their students) would be interested in the juxtaposition of the two opinions.

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Davidov on Labour Law's Goals

Guy Davidov (Hebrew U.) has just posted on SSRN his article Articulating Labour Law's Goals: Why and How.  Here's the abstract:

It may seem obvious that before doing anything – let alone something as important as interpreting or reforming labour law – we must ask ourselves what exactly is the goal of what we do. This seems to be the only rational approach to such tasks. Yet quite often we do things automatically, without stopping to think about them. The goal of this article is to explain why we need to articulate explicitly the goals of labour law, and how this should be done. It proceeds in two parts. Part I addresses the question of "why" and "when" is it necessary to explain (to ourselves and to others) the goals of labour law. Part II then discusses the "how", going through a number of steps that can assist us in articulating goals, and attempting to resolve a number of issues that arise when starting to think about the best way to approach this problem.

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Western Ontario Labour Law Conference: Faultlines and Borderlines in Labo(u)r Law

The University of Western Ontarion Law Faculty is hosting a wonderful set of labour law conferences on March 2 and 3, 2012. The theme of the 2012 lecture/conference will be Faultlines and Borderlines in Labo(u)r Law: The Future of the Wagner Act in Canada and the United States. This is a joint project of the UWO Faculty of Law, Koskie Minsky, Heenan Blaikie, and the Canada-US Institute at Western.

On Friday, 2 March 2012, Ms. Wilma Liebman, the former Chair of the National Labor Relations Board, will be delivering the seventh Koskie Minsky University Lecture in Labour Law. She was appointed Chair of the NLRB by President Obama as one of his first acts after assuming office in January 2009. The title of her Lecture will be: Labor Law, Economic Justice and Political Rhetoric: Reflections on the Wagner Act.

The following day, Heenan Blaikie LLP and the Faculty of Law at the University of Western Ontario will be hosting the full-day conference. There will be four panels, on the themes of human rights in the workplace, the role of trade and investment in shaping labour law, the crisis in public sector collective bargaining, and the future of the Wagner Act, with distinguished speakers from both sides of the 49th parallel on each panel. With unionization at 29% in Canada, and 12% in the United States, this conference will assess the viability of the Wagner Act and its ability to continue to promote industrial fairness.

The conference will conclude with a Saturday evening dinner, with the Honourable Lisa Raitt, Federal Minister of Labour as the guest speaker.

I am honored that I will be speaking at the conference as well.

The conference web page can be found here and that web page contains a link to the whole conference brochure.

PS

Washington Post-Kaiser Family Foundation poll on race, sex, attitudes and feelings of well-being

The Washington Post and Kaiser Family Foundation have released the results of a recent survey on feelings of well being and attitudes by race and sex on such wide ranging topics on how secure people feel, what they are worried about, and whether they think race or sex discrimination continues to be a problem. The poll has longitudinal data from 5 years ago, and also goes back farther on at least one of the questions. I use these kinds of surveys to help animate class discussions, especially  to talk about why people might choose to litigate or what people might be prepared to believe. It helps ground that discussion in something more than my gut feeling about what people value, which tends, not surprisingly, to be skewed to what I value.

MM

More Labor News . . . .

There have been several more recent labor developments/stories that are worth a look.  Among them:

• A possible issue for the Supreme Court?  Disagreeing with both the Third and Fourth Circuits, the Eleventh Circuit (2-1) in Mulhall v. UNITE HERE, has just held that neutrality agreements might be considered a "thing of value" that violates Section 302 of the LMRA.  This reversed a motion to dismiss, so the court avoided details about when such agreements would violate Section 302, but this could be a big deal that warrants the Court's attention (I'm pretty sure petitions for cert. are in the works as I write this).  If it does get to the Court, I'd be willign to bet that the 11th Circuit gets overturned.  Even for a labor-unfriendly Court, this interpretation is a stretch; note the lack of virtually any examination of the intent of Section 302 in Mulhall.  But we'll see.

• A fascinating piece by the New York Times on why Apple and other companies manufacture in Asia.  Costs is obviously part of the story, but perhaps less than you thought.  Of particular interest given all we're going to year this election year about economic inequality.

• Another NY TImes article on employers' increased use of lockouts (theme:  it's not just for professional sports anymore).

• Part of the FAA Authorization compromise affected the NMB's new election rule.  The rule stands, but there was a compromise that now requires a 50% showing of interest to get an election (an increase from 35%), allows employees to vote for "no union" in some runoff elections, and requires the NMB to hold public hearings before it engages in major rulemaking.

• Another IKEA plant has voted to unionize.  Apparently, things were much less hostile in the Perryville, MD warehouse than the previous campaign in Danville, VA, and the union (IAM) won 183-119.

Hat Tip:  Dave Casserly & Dennis Walsh

-JH

Recent NLRB Decisions

There have been a couple notable NLRB decisions recently.  Among them:

• The NLRB, in a case from the previous Board, has extended its Speciality Healthcare rule to a non-healthcare workplace in DTG Operations.  The bottom line is that this continues the Board's increased willingess to approve a unit that does not include all employees in the same facility.  Also notable is an especially strong dissent by Member Hayes.
• In Flaum Appetizing, a 2-1 Board concluded that an employer trying to use Hoffman Plastic to avoid paying back to employees who are allegedly undocumented must provide a factual basis for its claim. This burden will require employers to give specifics on the lack of documentation, such as fraudulent documents that employees used to get their jobs

Hat Tip:  Patrick Kavanagh & Dennis Walsh

-JH

Board GC Seeks Changes in Deferral Policy

Citing concerns about delays in processing grievances through parties’ contractual grievance-arbitration procedures, NLRB Acting General Counsel Lafe Solomon has proposed that the Board consider revising the existing policy of deferring charges to arbitration in certain circumstances.

When it is anticipated that charges alleging violations of Section 8(a)(1) and (3) – which include discharges or other discrimination based on union activities -- will not be resolved or arbitrated within a year, Acting General Counsel Solomon would urge that the Board not defer the case, but rather decide the case on the merits.  He would also apply the new policy to cases that have already been deferred for more than one year.  AGC Solomon specifically targeted cases involving issues of unlawful discrimination and interference with workers’ protected rights because they are significant and uniquely within the Board’s expertise.

Here's the Board's press release; here's supposed to be Solomon's memo (but the website says the document is unavailable at this time).

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A 2-Fer on Equal Pay

Deborah Eisenberg (Maryland) has just posted on SSRN two articles dealing with equal pay issues. The abstracts are posted after the break; the articles are:

• Money, Sex, and Sunshine:  A Market Based Approach to Pay Discrimination, 43 Ariz. St. L.J. 951 (2012).
• Lessons from Wal-Mart Stores v. Dukes About the Legal Quest for Equal Pay, 46 New England L. Rev. (forthcoming 2012).

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Money, Sex, and Sunshine:  A Market Based Approach to Pay Discrimination, 43 Ariz. St. L.J. 951 (2012).

The Equal Pay Act had a distinct market purpose. Congress made a policy choice to modify the existing compensation market so that employees who perform jobs requiring substantially “equal skill, effort, and responsibility” earn equal wages, regardless of sex. The Act aimed not simply to promote individual fairness, but to foster a more efficient, equitable wage market on a systemic level. Congress recognized that paying lower wages to women constituted “an unfair method of competition,” burdened “commerce and the free flow of good in commerce,” and prevented the “maximum utilization of available labor resources.” Over time, however, the “market” in equal pay cases has been transformed from the fundamental reason for the Act to an acceptable business defense for paying women less. At the same time, pay discrimination is conceptualized today in the rhetoric of “fairness,” which overshadows the core market purpose of the Act.

This Article contends that equal pay laws have failed in their market purpose and will continue to fail so long as reform is centered solely on a litigation-enforcement model. The Article reframes pay discrimination as a market failure caused by insufficient and asymmetric information about the value of work, rather than an individual fairness concern. It explores lessons that can be learned from executive compensation scholarship, which offers more sophisticated analyses of the causes of abusive pay practices. Executive pay scholars have exposed: (1) the human dynamics and conditions that cause compensation markets to fail; (2) the ineffectiveness of litigation to fully address abusive pay because of court reluctance to interfere with “business judgments” about compensation; and (3) the crucial role of transparency as a market-based tool to reform abusive pay practices.

Applying these lessons in modified form, the Article examines how pay secrecy distorts compensation markets and permits pay discrimination to flourish, even in the absence of intentional sex discrimination. Given the increasing ineffectiveness of equal pay litigation, it analyzes how pay disclosure and transparency can be used to promote a more efficient compensation market in which employees are appropriately valued and rewarded without the taint of discriminatory factors.

Lessons from Wal-Mart Stores v. Dukes About the Legal Quest for Equal Pay, 46 New England L. Rev. (forthcoming 2012).

The Supreme Court’s decision in Wal-Mart Stores, Inc. v. Dukes provides a unique opportunity to reflect on whether and how the legal system should address unjustified pay disparities between men and women who perform similar jobs. This Article describes the Court’s decision and analyzes the insights it offers about the legal quest for equal pay. First, Wal-Mart demonstrates the tension between Title VII’s focus on the employer’s intent and the economic realities of how pay discrimination happens in the modern workplace. As the women at Wal-Mart experienced and research confirms, pay disparities tend to be the greatest when employers delegate excessive, unchecked discretion to supervisors. Second, Wal-Mart exemplifies how litigation remedies tend to be ineffective for pay discrimination because of the intent requirement of Title VII, the prima facie standard of substantially equality under the Equal Pay Act, the broad “factor other than sex” defense, and procedural difficulties for group actions.

This Article proposes a blueprint for a more effective remedy for pay discrimination that would: (1) provide incentives for self-regulation by employers, such as pay transparency and periodic compensation audits; (2) limit defenses to those that are job-related and consistent with business necessity; (3) incorporate a pragmatic interpretation of equal work; and (4) facilitate group actions for systemic pay discrimination.