Workplace Prof Blog

Ninth Circuit Revises Workplace Privacy Ruling

A few months ago, we wrote about the 9th Circuit case of United States v. Ziegler, in which the court had found that a private sector employee had no legitimate expectation of privacy under the Fourth Amendment when government agents sought to use evidence from his workplace computer in a criminal prosecution.  This finding was based on the fact that his company had access rights to the computer.

Orin Kerr of the Volokh Conspiracy vehemently opposed this reading of what the Fourth Amendment requires and now the 9th Circuit panel has reissued its opinion in the case, United States v. Ziegler, No. 05-30177 (9th Cir. Jan. 30, 2007).  Although the result comes out the same, Orin is now happy because the court's reasoning is more consistent with Fourth Amendment precedent in this area. 

Here is some of what Orin said yesterday about the case on The Volokh Conspiracy:

The new opinion gets it right: it concludes that the employee had a reasonable expectation of privacy in the machine, but that the employer had the right to consent to the government's search under third-party consent principles. The end result is the same — the evidence is admissible — but the reasoning is very different.

More specifically, the Ninth Circuit relies on this Supreme Court precedent:

Mancusi [v. DeForte, 392 U.S. 364 (1968)] compels us to recognize that in the private employer context, employees retain at least some expectation of privacy in their offices. Id. See also Ortega v. O’Connor, 480 U.S. 709, 716 (1987) (noting that in Mancusi "this Court . . . recognized that employees may have a reasonable expectation of privacy against intrusions by police."); id. at 730 (Scalia, J., concurring) ("In Mancusi v. DeForte, we held that a union employee had Fourth Amendment rights with regard to an office at union headquarters that he shared with two other employees, even though we acknowledged that those other employees, their personal or business guests, and (implicitly) 'union higher-ups' could enter the office.") (internal citations omitted).

Well, I am glad to see that the court took the time to get its opinion right and, in the process, protect important privacy interests of private sector employees.  And who knows, maybe the court changed its mind after reading Orin's very persuasive analysis of the issue.

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Third Circuit Follows IBM Decision on Cash Balance Plan Conversions

We had previously written about the decision in Register v. PNC, in which the Eastern District of Pennsylvania had concluded that cash balance plan conversions were not age discriminatory.  The Third Circuit has now affirmed, largely following the 7th Circuit's IBM decision.  The case is Register, et al., v. PNC Financial Services Group, No. 05-5445 (3rd Cir. Jan. 30, 2007).

Here are some excerpts from Lyle Denniston's post on the Third Circuit's decision at the SCOTUSblog:

The Third Circuit, saying that "much is at stake here," concluded that the challengers were focusing wrongly on the potential output of a cash balance plan upon retirement. The focus, the Court said, should be on the inputs -- the credits added to each employee's account annually. All participants get the same interest credit added to their accounts each year, so there is no age-related bias, the Court found. Its reasoning closedly tracked that of the Seventh Circuit in the IBM litigation.

What an employer puts into a worker's pension plan, the Third Circuit said, is more valuable when contributions are made to younger employees since the contributions "have a longer time to grow. That unremarkable consequence of a contribution growing in value because of earnings on it is no different than that when a bank deposit is drawing interest. The longer the deposit remains in the bank in an interest bearing account, the more it is worth. We do not find any support for [the] argument that Congress wanted to prohibit such a consequence with respect to cash balance plans..."

The battle goes on, but it does seem that the momentum is on the side of those that find such conversions non-discriminatory.

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Fields of Institutional Deference

UCLA Law Review will be hosting a symposium this Friday on 'Constitutional Niches': The Role of Institutional Context in Constitutional Law.  Sub-topics include educational institutions; national, state, and local governments; national security institutions; and most importantly, the workplace.  Paul Secunda, Cynthia Estlund, and Scott Moss will be presenting on the workplace side of things.  Great program; great cast!

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Fed Aviation Admin to Raise Mandatory Retirement Age for Airline Pilots

The Federal Aviation Administration has announced that it will issue a Notice of Proposed Rulemaking later this year to raise the mandatory retirement age of airline pilots from 60 to 65.  FAA Chief Marion Blakely made the announcement at a speech yesterday to the National Press Club, and the FAA subsequently issued a press release.

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It is the Ceballos of Times

Here's an appellate case from Michael Fox at Jottings By An Employer's Lawyer that illustrates the continuing impact that the recent Supreme Court case of Garcetti v. Ceballos is having on public employee rights.  Recall that Ceballos holds that public employees enjoy no First Amendment rights when speaking pursuant to their official duties.

Here's some excerpts from Michael's post:

Last week, the police officer primarily responsible for establishing the canine handling unit for Circleville, Ohio, found out just what those restrictions were about. Although he had successfully prevailed against defendants' motion for summary judgment in the district court, he had that victory taken away at the appellate level based in part on Garcetti.

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What Officer Haynes viewed as public speech . . . to the 6th Circuit was nothing more than the “the quintessential employee beef: management has acted incompetently.” . . . . And employee beefs, legitimate or not, are no longer (if they ever were) the grist of successful 1st amendment claims.

Unlike Michael, I believe that such "employee beefs" should be a matter of First Amendment concern if the employee is speaking out on a matter of public concern and his or her speech rights do not substantially interfere with the government employer's efficiency interests (i.e., don't substantially disrupt the workplace).  Indeed, this is exactly why this plaintiff initially survived summary judgment at the district court level.   

A citizen does not cease being a citizen just because during part of the day that person performs work for the government. Langdellian formalism notwithstanding, Ceballos' pigeon-holing of citizen-employees as merely employees is inconsistent with how most employees view themselves and with the reality of the workplace.

The case is Haynes v. City of Circleville, Ohio, No. 06-3070 (6th Cir. Jan. 25, 2007).

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Jolls on How Antidsicrimination Law Inadvertently Reduces Implicit Bias

Christine Jolls has just posted on SSRN her new article Antidiscrimination Law's Effects on Implicit Bias.  Here's the abstract:

It is by now commonplace to observe that bias on the basis of race and other traits in American society today is primarily unconscious, or implicit, rather than conscious in nature. It is equally commonplace to critique existing antidiscrimination law for its failure to create significant liability for behavior stemming from such implicit bias. Despite this broad condemnation of existing antidiscrimination law, essentially no progress has been made on efforts to reform the law in response to the problem of implicit bias. The present paper suggests, however, that an important piece of the relationship between antidiscrimination law and implicit bias has been overlooked in the existing debate. The missing piece is the way in which current antidiscrimination law – although it concededly does not aim at implicitly biased behavior in a significant way – nonetheless tends to have the effect, in a wide range of respects, of reducing implicit bias. In this account of antidiscrimination law, the existing legal regime occupies a far more positive, although admittedly still imperfect, relationship with implicit bias. As explored in the paper, in diverse areas ranging from employment law to education law to the law governing various types of voluntary organizations, current antidiscrimination doctrines are likely to shape and affect the level of people's implicit bias in important ways. Understanding these previously ignored effects of current antidiscrimination law allows us to appreciate what is valuable, good, and worth celebrating about this law, notwithstanding its undeniable shortcomings.

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Cass Sunstein on the Costs and Benefits of Reasonable Accommodation

Cass Sunstein has just posted on SSRN his new article, Cost-Benefit Analysis Without Analyzing Costs of Benefits: Accomodation, Balancing, and Stigmatic Harms.  Here's the abstract:

Is an accommodation “reasonable,” under the Americans with Disabilities Act, if and only if the benefits are roughly proportional to the costs? How should benefits and costs be assessed? Should courts asks about how much disabled employees are willing to pay to obtain the accommodation, or instead how much they would have to be paid not to have the accommodation? How should stigmatic or expressive harms be valued? This essay, written for a symposium on the work of Judge Richard A. Posner, engages these questions in a discussion of an important opinion in which Judge Posner denied accommodations involving the lowering of a sink in a kitchenette and a request for telecommuting. The problem with the analysis in that opinion is that it does not seriously analyze either costs or benefits. A general lesson is that while cost-benefit balancing can helpfully discipline unreliable intuitions about the effects of requested accommodations, it can also incorporate those intuitions. Another lesson is that stigmatic harms and daily humiliations deserve serious attention as part of the inquiry into which accommodations are reasonable, and that the removal of those harms and humiliations can create real benefits. Adequate cost-benefit analyses must attempt to measure and include those benefits.

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EBRI on Behavioral Finance and Retirement Plan Contributions

Thanks to Jon Forman (Oklahoma) for directing me to this important report by the Employee Benefit Research Instiutute (EBRI) on Behavioral Finance and Retirement Plan Contributions: How Participants Behave, and Prescriptive Solutions.

Here are some points from the Executive Summary of the report:

Enactment of the Pension Protection Act of 2006 (PPA), notably its automatic enrollment, automatic default contribution, and automatic deferral increase provisions, illustrates that Congress implicitly endorsed the value of behavioral economics as applied to retirement policy.

• Behavioral research has repeatedly demonstrated many workers’ tendency to follow whatever retirement planning path provides the least resistance. Benefit plan architects and administrators effectively direct and pave that path when they design retirement plans, especially when establishing plan default provisions, the “rules” governing what happens when workers fail to make active decisions.

• Workers can benefit from a simplified enrollment process, “required” active decisions may increase participation and contribution deferral rates, and other plan features (such as automatic deferral escalation) are effective in increasing participant savings rates.

A worthy report on how to utilize behavioral research to make retirement saving work for more individuals.

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En Banc MS Supreme Court Weighs In on ADEA Pretext Case

In Cash Distributing v. Neely (Miss. Jan. 25, 2007) (en banc), the Mississippi Supreme Court found in a 5-3 en banc decision an ADEA plaintiff may prevail at trial without rebutting all of the employer's nondiscriminatory reasons.  The court found that United States Supreme Court precedent required only that the plaintiff rebut the employer's nondiscriminatory reasons for the discharge by persuading the jury that, true or not, the reasons offered by the employer were not the motivating reasons for his discharge. (The use of the motivating reasons language seems to fit with mixed motive analysis.  It does not appear, however, that mixed motive analysis played any role in this case.).

I think the majority has it right, given language from Reeves, quoting Hicks.  In particular:

The factfinder’s disbelief of the reasons put forward by the defendant (particularly if disbelief is accompanied by a suspicion of mendacity) may, together with the elements of the prima facie case, suffice to show intentional discrimination. Thus, rejection of the defendant’s proffered reasons will permit the trier of fact to infer the ultimate fact of intentional discrimination.

In particular, I don't think the plaintiff need show that the employer's nondiscriminatory reasons are false, but merely that those reasons did not cause the employee to lose his or her job. Such a finding, along with establishment of the prima facie case by the plaintiff, should permit (not require) a factfinder to find unlawful discrimination on the part of the employer.

We have not heard the last on this issue.  It bears mentioning that this case goes against a substantial amount of contrary existing precedent in the 3rd, 5th,  7th, and 11th Circuits, which all require rebuttal  by the plaintiff of each and every nondiscriminatory reason offered by the employer in order for an employment discrimination plaintiff to prevail in a pretext case.

The Supreme Court should decide, once and for all, that these Circuit Courts' understanding of McDonnell Douglas and Burdine is a far too restrictive reading of what plaintiffs should have to establish in Title VII/ADEA  pretext cases in order to prevail.

Hat Tip:  Ross Runkel

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Recently-Published Scholarship

   

Articles

• Andrew Koppelman (top left), You Can't Hurry Love: Why Antidiscrimination Protections for Gay People Should Have Religious Exemptions, 72 Brooklyn L. Rev. 125 (2006).
• Noah D. Zatz (top row, second), What Welfare Requires from Work, 54 UCLA L. Rev. 373 (2006).
• Cynthia L. Estlund (top row, third), Between Rights and Contract: Arbitration Agreements and Non-Compete Covenants as a Hybrid Form of Employment Law, 155 U. Penn. L. Rev. 379 (2006).
• Amy J. Schmitz (top row, fourth), Embracing Unconscionability's Safety Net Function, 58 Alabama L. Rev. 73 (2006).
• Leticia M. Saucedo (top row, right), The Employer Preference for the Subservient Worker and the Making of the Brown Collar Workplace, 67 Ohio St. L.J. 961 (2006).
• Gregory Mitchell (bottom row, left) & Philip E. Tetlock (bottom row, second), Antidiscrimination Law and the Perils of Mindreading, 67 Ohio St. L.J. 1023 (2006).
• Karen L. Chadwick (bottom row, third), Is Leisure-Time Smoking a Valid Employment Consideration?, 70 Albany L. Rev. 117 (2006).
• Aida M. Alaka (bottom row, fourth), Corporate Reorganizations, Job Layoffs, and Age Discrimination: Has Smith v. City of Jackson Substantially Expanded the Rights of Older Workers Under the ADEA?, 70 Albany L. Rev. 143 (2006).
• Christopher S. Simon & Denise B. Simon, Bully for You; Full Steam Ahead: How Pennsylvania Employment Law Permits Bullying in the Workplace, 16 Widener L.J. 141 (2006).
• Richard A. Bales (bottom row, right), Normative Consideration of Employment Arbitration at Gilmer's Quinceanera, 81 Tulane L. Rev. 331 (2006).

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Sixth Circuit Adopts New Test for Reviewing Labor Arbitration Awards

The Sixth Circuit Friday released an en banc decision abandoning its four-part test for determining whether a labor arbitration award "fails to draw its essence from the [collective bargaining] agreement."  The Sixth Circuit substituted a new test: (1) whether the arbitrator was "arguably construing or applying the contract"; and, if so, whether (2) "the request for judicial intervention should be resisted even though the arbitrator made 'serious,' 'improvident,' or 'silly' errors in resolving the merits of the dispute."

Though the court unanimously agreed to the new test, the court split on how to apply the test to the facts of the case.  The majority affirmed the award; five dissenters would have vacated for two different reasons.

The case is Michigan Family Resources v. SEIU, No. 04-2564 (6th Cir. Jan. 26, 2007).  Hat tip: Ross Runkel.

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Study Finds Skin-Tone Prejudice Against Darker-Skinned Legal Immigrants

FoxNews.com has word about a disturbing study that establishes that lighter-skinned legal immigrants are more likely to earn more money in the United States than darker-skinned ones:

Light-skinned immigrants in the United States make more money on average than those with darker complexions, and the chief reason appears to be discrimination, a researcher says.

Joni Hersch, a law and economics professor at Vanderbilt University, looked at a government survey of 2,084 legal immigrants to the United States from around the world and found that those with the lightest skin earned an average of 8 percent to 15 percent more than similar immigrants with much darker skin.

"On average, being one shade lighter has about the same effect as having an additional year of education," Hersch said.

These  findings lend support to the view that there is a skin-tone prejudice in this country that goes beyond race.  Or as another commentator in the article puts it: a "preference for whiteness" in America.

Such findings should provide further fodder for implicit bias in the workplace theorists.

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Iowa Raises Minimum Wage

Although the current federal minimum wage bill is stalled in the Senate, the newly-elected Governor of Iowa just signed a law increasing that state's minimum wage to $7.25/hour.

Here's some more details from the AFL-CIO Blog:

The bill, which was backed by unions and community and religious groups, raises the Hawkeye state’s minimum wage from $5.15 an hour to $7.25 in two steps.

Some 260,000 Iowans are expected to see their pay grow because of the new wage floor, says Culver—who signed the bill on his birthday:

This is a real improvement in the quality of life for many Iowans…and this is quite a birthday present…I can’t think of a better gift.

Not only was the wage increase Culver’s first signing action, the bill was the first piece of legislation passed by the state Senate and House since voters handed control of the legislature to Democrats in November.

At least in Iowa, it sounds like Senate Republicans are fighting against an insurmountable wave of support for such legislation in this country:

According to a Des Moines Register poll, 61 percent of the state’s Republicans, 84 percent of independents and 90 percent of Democrats are behind the wage increase.

And they could not hand the Democrats a better wedge issue than this one.

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Top-5 Employment SSRN Downloads

1. Symeon C. Symeonides (photo above), Party Autonomy and Private-Law Making in Private International Law: The Lex Mercatoria That Isn't (96).
2. Oliver Hart & John Moore, Contracts as Reference Points (95).
3. Samuel R. Bagenstos, US Airways v. Barnett and the Limits of Disability Accommodation (82).
4. Oliver Hart & John Moore, Contracts as Reference Points (70) [sic].
5. Albert Feuer, How Employment Agreements and Settlements of Employment Disputes May Affect Pension Benefits (61).

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Top-5 Labor SSRN Downloads

1. Joseph E. Slater, The American Rule that Swallows the Exceptions (43).
2. Dianne Avery & Marion G. Crain, Branded: Corporate Image, Sexual Stereotyping, and the New Face of Capitalism (41).
3. Mitchell H. Rubinstein (photo above), Attorney Labor Unions (16).

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Top-5 International Employment & Labor Law SSRN Downloads

1. Howard F. Chang (photo above), The Economic Impact of International Labor Migration: Recent Estimates and Policy Implications (56).
2. David Kinley & Rachel Chambers, The UN Human Rights Norms for Corporations: The Private Implications of Public International Law (51).

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Top-5 Benefits/Compensation/Pension SSRN Downloads

1. Lucian Arye Bebchuk, Yaniv Grinstein, & Urs Peyer, Lucky CEOs (1129).
2. Lucian Arye Bebchuk, Yaniv Grinstein, & Urs Peyer, Lucky Directors (393).
3. Lucian Arye Bebchuk,  Martijn Cramers, & Urs Peyer, Pay Distribution in the Top Executive Team (78).
4. Albert Feuer, How Employment Agreements and Settlements of Employment Disputes May Affect Pension Benefits (61).
5. Dorothy A. Brown (photo above), Pensions and Risk Aversion: The Influence of Race, Ethnicity, and Class on Investor Behavior (55).

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UNLV Conference on Federal Arbitration Act

Thanks to Paul for blogging solo for the last few days while I attended UNLV's conference on whether the FAA should be amended.   A large proportion of the conference focused on the FAA's application to employees and consumers.   Jean Sternlight, Ray Patterson, and Peter Reilly (photos above) did a masterful job of putting the program together and running ti smoothly.

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Mueting on Recovering Legal Damages for ADA Employment Retaliation

An Iowa Law Student, Kate Mueting, has posted her Note in the Iowa Law Review on SSRN: A Clear Path through the Labyrinth: A Case for Allowing Victims of Employment Retaliation and Coercion to Recover Legal Damages under the Americans with Disabilities Act.

Here's the abstract:

More than a decade after Congress passed the Americans with Disabilities Act of 1990 (ADA) and expanded the remedies available for disability discrimination in employment with the Civil Rights Act of 1991, the Seventh Circuit in Kramer v. Banc of America Securities, 355 F.3d 961 (7th Cir. 2004) became the first federal appellate court to determine that victims of ADA retaliation and coercion in employment are ineligible for legal damages and jury trials.

After detailing the law and analysis implicated by this issue, this Note will assert that, based on the language, structure, and legislative histories of the ADA and the Civil Rights Act of 1991, the Seventh Circuit erred in its approach and conclusion. Furthermore, allowing victims of ADA retaliation and coercion in employment to recover punitive and compensatory damages is necessary to effectively further the ADA's anti-discrimination goals.

Hopefully, this Note will spur courts in future cases in this area of disability discrimination law to  reevaluate the appropriate remedies  for ADA retaliation.

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Wal-Mart Owes $34 Million for Overtime Violations

Is it any wonder with the on-going staggering amount of labor and employment liability Wal-Mart faces why they have to make the billions of dollars in profit they make in a year? 

Here's the lastest (via HR.BLR.com):

Wal-Mart Stores, Inc., has agreed to pay nearly $34 million in back wages and interest for calculating overtime incorrectly over a span of almost 5 years.

The agreement with the Department of Labor covers 86,680 employees who worked for the company from February 1, 2002 to January 19, 2007.

The department says that Wal-Mart brought the matter to its attention after an internal audit raised concerns regarding overtime calculations.

Wal-Mart says it failed to include periodic bonuses and other earned income in determining some employees' regular rate of pay for overtime purposes. In addition, some overtime payments were based on a regular rate calculated for each two-week payroll period, when they should have been calculated weekly.

Separately, some errors involved participants in the company's manager and programmer in training programs, who were entitled to overtime pay while in training, the company says.

Two thoughts: (1) kudos to Wal-Mart for bringing this situation voluntarily to the Department of Labor's attention; and (2) Wal-Mart should be spending a lot more money on good labor and employment attorneys who understand the FLSA (assuming that Wal-Mart is bringing these issues to their in-house and outside labor and employment counsel in the first place).  This is very basic stuff that my employment law students would understand.

Interestingly, "[i]n addition to paying back wages, [Wal-Mart] also agreed to set up a website ( http://www.dol.settlement.wal-mart.com ) and to staff a toll-free telephone number to answer questions regarding the back wages."

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