Monday, August 31, 2009
The New York Times has a nice article on some major shifts in focus at the Civil Rights Division of the DOJ. The article delves deeply into the damage done to the department the last several years and explains how AG Holder envisions the division's focus will be shifting. A brief taste of the article:
As part of this shift, the Obama administration is planning a major revival of high-impact civil rights enforcement against policies, in areas ranging from housing to hiring, where statistics show that minorities fare disproportionately poorly. President George W. Bush’s appointees had discouraged such tactics, preferring to focus on individual cases in which there is evidence of intentional discrimination.
To bolster a unit that has been battered by heavy turnover and a scandal over politically tinged hiring under the Bush administration, the Obama White House has also proposed a hiring spree that would swell the ranks of several hundred civil rights lawyers with more than 50 additional lawyers, a significant increase for a relatively small but powerful division of the government . . . .The administration’s fiscal year 2010 budget request includes an increase of about $22 million for the division, an 18 percent increase from the 2009 budget. Other changes are already apparent. The division has filed about 10 “friend of the court” briefs in private discrimination-related lawsuits since Mr. Obama’s inauguration, a practice that had dwindled in the previous administration. . . .
Bush-era changes to the division’s permanent rank may also have lingering effects. From 2003 to 2007, Bush political appointees blocked liberals from career jobs and promotions, which they steered to fellow conservatives, whom one such official privately described as “real Americans,” a department inspector general report found. The practice, which no previous administration had done, violated civil service laws, it said.
As morale plunged among veterans, turnover accelerated. The Obama transition team’s confidential report on the division, obtained by The New York Times, says 236 civil rights lawyers left from 2003 to 2007. (The division has about 350 lawyers.) Many of their replacements had scant civil rights experience and were graduates of lower-ranked law schools. The transition report says the era of hiring such “inexperienced or poorly qualified” lawyers — who are now themselves protected by civil service laws — has left lasting damage.
“While some of the political hires have performed competently and a number of others have left, the net effect of the politicized hiring process and the brain drain is an attorney work force largely ill-equipped to handle the complex, big-impact litigation that should comprise a significant part” of the division’s docket, the transition report said.
There's far more in the full piece, so check it out.
The full article describing the IIRA Conference in Sydney can be found here.
Those of us from the U.S. who attended the just concluded World Congress of the International Industrial Relations Association in Sydney, Australia experienced a rare treat and learned firsthand how out of synch are America’s efforts to modernize labor and employment policies with what is happening here and around the world. We visited a country in which the last federal election turned on labor policy, where work and employment issues are viewed as a central part of economic policy, and where the newly elected government enacted a major reform and modernization of labor and employment policy within a year of taking office.Just imagine the following scene from the opening session of the World Congress. Deputy Prime Minister Julia Gillard (the number two official in the government) not only came to give a warm welcome to the 900 delegates. She gave a highly substantive speech reviewing the new legislation that she personally had help shape and negotiate through Parliament.
The new law called the “Fair Work Act” is impressive for its comprehensiveness and for its focus. While the centerpiece provisions establish procedures supporting collective bargaining (including new procedures governing union recognition and good faith bargaining), it also covers minimum employment standards, work and family leave, the right to request flexibility to care for young children, and provides options for negotiating and enforcing individual employment contracts that exceed the standards negotiated in collective agreements....
The American delegation included:
Joel Cutcher Gershenfeld, University of Illinois, Henry and Sue Bass, Merrimack Films, Matthew Finkin, University of Illinois, Janice Bellace, University of Pennsylvania, Lonnie Golden, Penn State University, Peter Berg, Michigan State University, Raphael Gomez, University of Toronto, Richard Block, Michigan State University, Harry Katz, Cornell University, John Budd, University of Minnesota, Bruce Kaufman, Georgia State University, Bonnie and Robert Castrey, Arbitrators, Thomas Kochan, Massachusetts Institute of Technology, Paul Clark, Penn State Universitty, Anil Verma, University of Toronto, Alex Colvin, Cornell University, and Hoyt Wheeler, University of South Carolina
Sunday, August 30, 2009
Steven Greenhouse (New York Times) has an article on a disturbing agreement that a company in Montana is "urging" all workers to sign. Regis, the country's largest hair salon company, wants workers at salons in Montana to sign a document stating: “In order to preserve my right to a secret-ballot election, and for my own protection, I knowingly and without restraint and free from coercion sign this agreement revoking and nullifying any union authorization card I may execute in the future.” As the CEO admitted, this document is intended to prospectively take away the ability of employees to get voluntary recognition for a union or, should a card-check provision pass, take advantage of that. He also says signing the card is "totally voluntary," but the idea that an employee would really feel free not to sign, especially in this economy, defies belief.
As Bill Gould (Stanford) was quoted as saying, this is illegal (and, in his words, a "modernized version of the old yellow dog contract"). Not only does it run contrary to the NLRA's statement that workers have the right to designate a representative of their own choosing--note the lack of the word "elect"--but it looks like a blatant 8(a)(1) violation.
Of course, Regis may have gotten more than they asked for. Although the salons at issue had never garnered any union activity in the past, labor leaders are now threatening to picket and distribute fliers at the salons.
Reminder: This and other stories of interests, covered and not covered on the blog, can be found on psecundawrkprof Twitter feed here.
NPR had a story on Friday about the problem of wage theft in post-Katrina New Orleans. As the story notes, the problem isn't limited to New Orleans, but the reconstruction and influx of immigrants there makes it a particularly large problem. One figure in the story--that 80% of workers had faced some wage theft--was astonishing. Of course, in some states, the legal recourse is even worse, as there's nothing more than federal minimum wage protection or a near impossible to recover contract claim available.
Also, kudos for Loyola-L.A.'s law clinic for their work in this area. It's something there's definitely a need for.
I am colorblind so this fine is discriminating because I'm disabled in a way, this is a sad day for me.
Saturday, August 29, 2009
- Guido A. Ferrarini, Niamh Moloney, & Maria-Cristina Ungureanu, Understanding Directors' Pay in Europe: A Comparative and Empirical Analysis (225).
- Richard L. Kaplan, Nicholas J. Powers, Jordan Zucker, Retirees at Risk: The Precarious Promise of Post-Employment Health Benefits (167).
- Mathias M. Siems & Simon Deakin, Comparative Law and Finance: Past, Present and Future Research (107).
- David Maber & Fabrizio Ferri, Say on Pay Votes and CEO Compensation: Evidence from the UK (106).
- Daniel Shaviro (photo above), The 2008-09 Financial Crisis: Implications for Income Tax Reform (103).
- Claire Kilpatrick, British Jobs for British Workers? UK Industrial Action and Free Movement of Services in EU Law (77).
- Jack VanDerhei, How Would Target-Date Funds Likely Impact Future 401(K) Accumulations? (75).
- John Monahan, Laurens Walker, & Gregory Mitchell, The Limits of Social Framework Evidence (67).
- Janice Kay McClendon, The Death Knell of Traditional Defined Benefit Plans: Avoiding a Race to the 401(k) Bottom (67).
- Jeffrey M. Hirsch, Making Globalism Work for Employees (54).
Friday, August 28, 2009
Edward Zelinsky (Cardozo) will will deliver the 2009 Dr. Arthur Grayson Distinguished Lecture on September 24 at the Southern Illinois University School of Law. His topic will be Reforming Health Care: The Conundrum of Cost.
A former receptionist in a suburban Washington, D.C., office of a national labor and employment boutique has sued her ex-employer over an alleged lack of bathroom breaks.
Plaintiff Rebecca Landrith contends in the D.C. Superior Court suit that the McLean, Va., office of Littler Mendelson had no formal policy or procedure about her bathroom breaks. It was so difficult to find someone to substitute for her while she took a break there, she alleges, that she twice "wet her pants" at the reception desk, reports the Washington Business Journal.
Two weeks after she complained about the lack of bathroom breaks to the firm's general counsel, she was fired, the suit contends.
Of course, these are only allegations, but all I can say is that I have worked at a number of law firms with labor and employment departments, and some of the crazy stuff that happens is just, well, crazy.
I also wonder what type of person would wet her pants twice rather than leave her work station. If there was no policy of bathroom breaks wouldn't the natural thing to do would be to use the bathroom when you had to? I am all for dedicated employees, but there are limits, you know.
Finally, I wonder who Littler uses for their labor and employment law work? Morgan Lewis?
Miriam Cherry (McGeorge/Georgia) and Jarrod Wong (McGeorge) have posted on SSRN their forthcoming work in the Minnesota Law Review: Clawbacks: Prospective Contract Measures in an Era of Excessive Executive Compensation and Ponzi Schemes.
From the abstract:
In the spring of 2009, public outcry erupted over the multi-million dollar bonuses paid to AIG executives even as the company was receiving TARP funds. Various measures were proposed in response, including a 90% retroactive tax on the bonuses, which the media described as a "clawback." Separately, the term “clawback” was also used to refer to remedies potentially available to investors defrauded in the multi-billion dollar Ponzi scheme run by Bernard Madoff. While the media and legal commentators have used the term “clawback” reflexively, the concept has yet to be fully analyzed. In this article, we propose a doctrine of clawbacks that accounts for these seemingly variant usages. In the process, we distinguish between retroactive and prospective clawback provisions, and explore the implications of such provisions for contract law in general. Ultimately, we advocate writing prospective clawback terms into contracts directly, or implying them through default rules where possible, including via potential amendments to the law of securities regulation. We believe that such prospective clawbacks will result in more accountability for executive compensation, reduce inequities among investors in certain frauds, and overall have a salutary effect upon corporate governance.
Perhaps, "String Them from The Lamp Posts," would have been a better subtitle, but I can hardly think of a more timely and relevant topic than this one. And as long as we have greedy executives and Madoffs (which unfortunately we will), we do need a more refined clawbak doctrine. Good job, guys!
Mitch Rubinstein from Adjunct Law Prof Blog writes to us that, "this is a bit different, but I think readers may be interested in this posting about the Pope's encyclical supporting unions." Here's the post and a taste of Caritas in Veritate, issued on June 29, 2009:
While reflecting on the theme of work, it is appropriate to recall how important it is that labour unions — which have always been encouraged and supported by the Church — should be open to the new perspectives that are emerging in the world of work. Looking to wider concerns than the specific category of labour for which they were formed, union organizations are called to address some of the new questions arising in our society: I am thinking, for example, of the complex of issues that social scientists describe in terms of a conflict between worker and consumer. Without necessarily endorsing the thesis that the central focus on the worker has given way to a central focus on the consumer, this would still appear to constitute new ground for unions to explore creatively. The global context in which work takes place also demands that national labour unions, which tend to limit themselves to defending the interests of their registered members, should turn their attention to those outside their membership, and in particular to workers in developing countries where social rights are often violated. The protection of these workers, partly achieved through appropriate initiatives aimed at their countries of origin, will enable trade unions to demonstrate the authentic ethical and cultural motivations that made it possible for them, in a different social and labour context, to play a decisive role in development. The Church's traditional teaching makes a valid distinction between the respective roles and functions of trade unions and politics. This distinction allows unions to identify civil society as the proper setting for their necessary activity of defending and promoting labour, especially on behalf of exploited and unrepresented workers, whose woeful condition is often ignored by the distracted eye of society.
As a member of a Jesuit law school faculty, I am very proud that the Catholic Church has continued to take such a view on the value of unions and the need to protect historically exploited workers. I checked with my favorite Jesuit and he tells me this is at least the fifth in a series of encyclicals commentating on the importance of labor unions starting with Pope Leo XIII in the late 1800s.
Although the percentage of employees represented in collective bargaining in the public sector is more than five times the percentage in the private sector, collective bargaining for public employees remains very controversial The two most powerful arguments against public employee collective bargaining is that it is antidemocratic and that it impedes effective government. Concern with the antidemocratic effects of public sector collective bargaining leads courts and labor boards to narrow the scope of what must be negotiated. Concerns with collective bargaining impeding effective government leads to backlash by the legislative and executive branches against public employee unions.
This article contends that the narrowness of the scope of bargaining that results from concerns over the antidemocratic nature of public employee bargaining leads to public employee bargaining impeding effective government. The law of negotiability channels channels employees and their unions away from participation in and responsibility for decisions affecting the risks of the public sector enterprise and into negotiating contract provisions that protect them from those risks. Public employee unions have performed that role very effectively, so effectively that the results can impede effective government. The article examines numerous cases where, in spite of the law, public employers have involved employees and their unions in decisions affecting the risks of the enterprise with very positive results. The article urges that jurisdictions break away from the private sector model which classifies every subject as either one on which collective bargaining is mandated or which is left to the unilateral control of management and develop alternative vehicles of employee-union voice in public sector decision-making.
Thursday, August 27, 2009
Mary Anne Moffa, Executive Director of the Peggy Browning Fund, has brought to our attention that this year's National Law Students Workers' Rights Conference will be held October 16-17, 2009, in Silver Spring, Maryland.
Each year this conference brings together law students, experts, and practitioners from all over the nation to discuss workers' rights laws in a thought-provoking, stimulating, educational environment. Here's a conference Brochure and Registration Form. More information about the conference is available at The Peggy Browning Fund website.
Many of my labor and employment students have attended over the past years, and they have raved about the experience. Please let your students know about this opportunity. Some funding assistance is available.
Via Ross Runkel comes news that the Federal Agency Acquisition Council's new rule that requires federal contractors to use the E-Verify program to confirm that new and existing employees are eligible to work in the United States has survived a federal challenge. The rule, set to go into effect on September 8, was challenged by the U.S. Chamber of Commerce and other employer groups as violating the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 (IIRIRA) and as exceeding the agency's authority and violating several other procurement acts. The District Court for the District of Maryland rejected all of the challenges.
IIRIRA prohibits that the Secretary of Homeland Security from requiring that anyone use a pilot program (like E-Verify) to establish eligibility of workers. Despite this language, the court found that the rule did not violate IIRIRA. First, it wasn't the Secretary who required that eligibility be checked by using a program, but the President (actually Presidents Clinton and Bush) who by executive order required use of a pilot program. Additionally, no one was required as an absolute matter to use the program. Companies that do not want to comply can simply decide not to do business with the federal government. Thus, they are not required to use the program. Sounds like the familiar spending clause analysis we see used to allow the federal government to exercise powers that it would otherwise not be able to.
The court also rejected all of the other challenges, essentially finding either that the complained-of acts were the President's and thus not limited by the various acts, or that the acts didn't prohibit the rule. I think--although feel free to correct me in the comments--that this was the only pending court challenge of the new rule and that although the effective date of the rule has been delayed several times, the current administration supports the rule and it will not be postponed again barring any new suits or stays granted.
Yale Journal of Health Policy, Law, and Ethics
Volume IX, Issue 2, Summer 2009
- Richard L. Kaplan, Nicholas J. Powers, and Jordan Zucker, "Retirees at Risk: The Precarious Promise of Post-Employment Health Benefits," p.287.
- Todd David Peterson and Elizabeth Waters Peterson, "Stemming the Tide of Law Student Depression: What Law Schools Need to Learn from the Science of Positive Psychology," p.357.
Symposium: The Role of Employers In Achieving Universal Health Care Coverage:
- David A. Hyman, "Employment Based Health Insurance and Universal Coverage: Four Things People Know That Aren't So," p. 435.
- Elizabeth Pendo, "Working Sick: Lessons of Chronic Illness for Health Care Reform," p. 453.
- Dov Fox, "Prenatal Screening Policy in International Perspective: Lessons from Israel, Cyprus, Taiwan, China and Singapore," p. 471.
Edward Zelinsky (Cardozo) has just published in Southern California Postscript Commentaries Interpretive Bulletin 08-1 and Economically Targeted Investing: A Missed Opportunity. Here's a brief description:
Bulletin 08-1 concern[s] the legal obligations of employee benefit plan fiduciaries when they invest the plan assets they control. Specifically, IB 08-1 addresses plan fiduciaries’ duties in the context of “economically targeted investing,” the investment of plan assets in pursuit of benefits for third parties rather than for plan participants and their beneficiaries. IB 08-1 revises prior regulations on economically targeted investing issued early in the Clinton administration. . . . Economically targeted investing contravenes ERISA’s duty of loyalty by permitting, indeed encouraging, plan trustees to invest plan assets to generate ancillary benefits for persons other than the participants whose labor is embodied in those assets. IB 08-1 was thus a missed opportunity. Economically targeted investing is neither a coherent concept nor a concept compatible with ERISA’s duty of loyalty.
Wednesday, August 26, 2009
This isn't news for most readers, but the New York Times has an article on the recession's effect on recent law school graduates, even those from the elite law schools (hint: it's not good). Among the lowlights:
This fall, law students are competing for half as many openings at big firms as they were last year in what is shaping up to be the most wrenching job search season in over 50 years.
For students now, the promise of the big law firm career — and its paychecks — is slipping through their fingers, forcing them to look at lesser firms in smaller markets as well as opportunities in government or with public interest groups, law school faculty and students say.
The frenzy has even pushed the nation’s top firms, a tradition-bound coterie, into discussing how to reform the recruitment process with an earnestness that would have been unthinkable just years ago. . . .
New York University, Georgetown, Northwestern and other top universities confirm that interviews are down by a third to a half compared with a year ago, while lower-ranked schools are suffering more. What is more, when interviews finish in a few weeks, even fewer offers will be extended, said Howard L. Ellin, the chairman of global hiring at Skadden, Arps, because many firms are interviewing students for slots they may not fill. . . .
The Social Security Administration . . . said applications for lawyer positions and clerkships had more than doubled this year, to 2,000, from 800. The public-interest job fair at N.Y.U. this year was “packed to the gills,” [a student] recalled, but whereas in past years students had seven or eight interviews, some of his classmates this year had zero. “There’s a humongous trickle-down effect,” he said. “When the big firms don’t hire, everyone looks to government. And when those get filled up, then what happens?” . . .
With the system’s frailties exposed by the recession, said Mr. Ellin from Skadden, Arps, the time could be ripe for “massive overhaul.” Discussions at industry roundtables and casual talk among officials at leading schools and firms suggest a consensus that interview dates should be pushed back to the spring of the second year, if not the third year. The recent problems have arisen, reform-minded critics say, because the legal industry essentially hires two full years ahead of when employees begin to work. And because young lawyers have to be advanced by lockstep every year, it is difficult to make recruiting changes that are responsive to shocks in business.
If the hiring process was actually reformed, that would be quite a silver lining to this situation. However, I do have one quibble with the article: the line about the economy "forcing" to look for government or public-interest jobs seems wrong. Although lower-paying, those jobs tend to be most in demand, even in the best of times. It's amazing how much people will give up in salary to do something they find more interesting (not to mention avoid having to worry about billable hours).
The Ninth Circuit, in USA v. Comprehensive Drug Testing--a 9-2 en banc decision authored by Judge Kozinski--has held that prosecutors improperly seized the results of a pilot baseball drug testing program to gauge the seriousness of steroid use. In 2003, MLB and the MLB players association conducted random drug testing that was supposed to remain anonymous, even to the players. As any sports fan knows, despite this anonymity pledge, several names have leaked out the past few years. The reason the list--which was to be destroyed--still exists is that federal prosecutors raided the testing company to find evidence about the truthfulness of several players' testimony about a drug supplier (BALCO). That raid also turned up results on about 100 other players--all of which the prosecutors kept.
The players union challenged the seizure, which the Ninth Circuit has no help was improper. The decision essentially said that prosecutors had no probable cause for seizing the results of the 100 players not involved in the investigation. The prosecutors were ordered to return the list. No word yet on whether prosecutors will seek cert.
Eighth Circuit Issues Important Decision on Integrated Enterprise and Evidence of other Acts of Sexual Harassment
The Eighth Circuit issued an important decision today in Sandoval v. American Building Maintenance Industries (Download Sandoval Opinion), a case involving sexual harassment at a company that provides janitorial services. The court's opinion clarified when a parent company will be considered an employer of the employees of a wholly owned subsidiary and what kinds of evidence can be used to demonstrate severity and pervasiveness of a hostile work environment and constructive notice to the employer.
The employees in this sexual harassment suit had been employed by the subsidiary, but some had sued the parent company and too late moved to amend to add the subsidiary. The district court had granted summary judgment, finding that there was insufficient evidence to show that the parent company was the employer, and for those employees who had sued the subsidiary, that there was insufficient evidence to demonstrate that the subsidiary had constructive notice of the hostile environment the plaintiffs were subjected to. There were other discrimination claims as well, but summary judgment was sustained for them with no additional analysis by the court of appeals, so I'll not deal with them here.
In deciding that the parent company was an employer, the court had to finesse its most recent decision on the matter. In Brown v. Fred’s, Inc., 494 F.3d 736, 739 (8th Cir. 2007), in which the panel applied "a strong presumption that a parent company is not the employer of its subsidiary's employees," relying on 4th and 10th circuit cases. The prior panel had held that Title VII plaintiff to the standard used by the 4th Circuit: "A parent company may employ its subsidiary's employees if (a) the parent company so dominates the subsidiary's operations that the two are one entity and therefore one employer, . . . or (b) the parent company is linked to the alleged discriminatory action because it controls individual employment decisions."
This panel reaffirmed that the circuit's prior 4-part test was the one to apply to determine when a parent dominates the the subsidiary's operations (the first part of the test above): 1) interrelation of operations, 2) common management, 3) centralized control of labor relations, and 4) common ownership or financial control. Using this test, the court found that there was substantial evidence that the parent company dominated the subsidiary, describing the interrelationship over three pages of the opinion. The factors that would show that domination focused primarily on common officers and ownership and centralized control of labor relations.
The court also made important new law in the sexual harassment claim. Part of a plaintiff's prima facie case for co-worker sexual harassment is that the harassment must have altered the working environment. This element involves both objective and subjective components. The harassment must be severe or pervasive enough to create an objectively hostile or abusive work environment, and the plaintiff must subjectively believe her working conditions have been altered. Additionally, in the Eighth Circuit, a plaintiff seeking to show that the employer is liable for coworker harassment must provide evidence to show that the employer knew or should have known of the harassment and failed to take prompt remedial action.
There was evidence presented of nearly 100 similar complaints of sexual harassment during the time that the plaintiffs were employed, which the district court had refused to consider because the plaintiffs had not been aware of them. The court of appeals held that this evidence had to be considered as evidence both that the harassment was objectively severe and pervasive enough to alter the plaintiffs' working conditions but also as evidence of constructive notice: that the harassment was so pervasive and open that a reasonable employer would have had to be aware of it.
On this last point, Judge Gruender dissented, stating "the Court ignores the fact that [this evidence included] numerous sexual harassment complaints concerning different victims and different employees at different locations. [The employer] has approximately 400 locations at which it provides janitorial services in Minnesota." These other actions, in the dissenting judge's view, could not put the employer on notice that these plaintiffs at this location would be subject to harassment.
Interesting developments on these two points.
Hat tip: Justin Cummins