Employers who offer short-term and long-term disability plans governed by the Employee Retirement Income Security Act (ERISA), and their plan administrators, need to prepare for the approaching April 1st deadline of the new claims handling regulations.  Employer action items can be found in our article posted here. The ERISA regulations were effective January 2017, but were delayed until April 1, 2018. The U.S. Department of Labor (DOL) has confirmed the ERISA disability claims administration regulations will not be delayed or revised further, according to the DOL’s recent announcement.

Jackson Lewis attorneys are available to assist employers, plan administrators, and TPAs to ensure compliance by April 1st.

In October 2016, AARP sued the Equal Employment Opportunity Commission (“EEOC”) under the Administrative Procedures Act (“APA”) arguing that there was no explanation for the shift in the EEOC’s position relating to what makes participation in a wellness program “voluntary”.  Originally, the EEOC argued that in order for a wellness program to be “voluntary,” employers could not condition the receipt of incentives on the employee’s disclosure of American with Disabilities Act (“ADA”) or Genetic Information Nondiscrimination Act (“GINA”) protected information.  However, under the wellness regulations, the EEOC now takes the position that an incentive of up to 30 percent of self only coverage would not render a program involuntary.  AARP argued that participation in a wellness program was not truly “voluntary” if an employee must choose between receiving a 30 percent decrease in health insurance premiums or providing their family’s personal health information to their employers. See AARP v. EEOC.

On August 22, 2017, AARP scored a win when U.S. District Judge John Bates granted AARP’s motion for summary judgment, finding that the EEOC had not sufficiently explained why programs that allowed employee participation incentives of up to 30 percent of the cost of the employee’s health insurance premiums didn’t violate the ADA or GINA requirements that such programs be voluntary. August 22, 2017 Opinion.  Shortly thereafter, AARP filed a Motion to Alter or Amend the Judgment asking the Court to either (1) vacate the wellness regulations but stay the mandate until January 1, 2018, or (2) issue an injunction against enforcement of the regulations effective January 1, 2018.  The EEOC opposed the motion stating that a “2018 vacatur of the Rules would be too disruptive for employers and employees.”

The Court’s December 20, 2017  Memorandum Opinion rejected AARP’s argument that the wellness regulations should be halted January 1, 2018.  Judge Bates determined that the current rules should remain in effect until January 1, 2019 in order to give the EEOC time to issue interim or revised rules on the issue.  The Opinion goes on to state that the “Court will also hold the EEOC to its intended deadline of August 2018 for the issuance of proposed rulemaking…but an agency process that will not general applicable rules until 2021 is unacceptable. Therefore, EEOC is strongly encouraged to move up its deadline for issuing the notice of proposed rulemaking, and to engage in any other measures necessary to ensure that its new rules can be applied well before the current estimate of sometime in 2021.”

In response to Judge Bates’ December 20th Opinion, the EEOC filed a Partial Motion for Reconsideration alleging that there was no basis for the Court to retain jurisdiction over the matter or to set deadlines for the EEOC to issue public notice and to file a status report with the Court.  The EEOC argued that “whether to amend or scrap the portions of the rules the court found illegal, and on what schedule, is entirely within the EEOC’s discretion.” Therefore, the EEOC has asked the Court to reconsider these aspects of its ruling.

In light of these decisions—and the uncertainty surrounding the future of the wellness regulations—employers should continue to run their wellness programs in accordance with the current regulations for 2018, but anticipate a change in the future.

For our previous blogs in this case, please see EEOC’s 2016 Wellness Program Regulations, The Saga Continues… AARP Suffers a Setback in its Challenge to the EEOC’s Wellness Regulations

The ADA Amendments Act of 2008 (ADAAA) made a number of significant changes to the definition of “disability.” Much of the change had to do with making it easier for an individual to establish that he or she has a disability within the meaning of the statute.  As a result employers have been accepting many more medical conditions as a covered disability and moving directly to the analysis of potential accommodations.  A recent decision by the U.S. District Court in Alabama reminded us that the analysis of an employer’s obligations under the ADA must start with determining the specific functional limitations of the applicant or employee.

In Feltman v. BNSF Railway Company (N.D. Ala Jan. 24, 2018) the Court concluded that an employee with a partially amputated foot was not disabled under the ADA (his toes and the adjoining area of his right foot were amputated).  Mr. Feltman applied for a Conductor Trainee position and was given an offer conditioned on a pre-employment medical examination.  During the medical examination his foot was not specifically evaluated nor did it present any obvious limitations.  Following the medical examination the Company concluded that Mr. Feltman was medically qualified for the Conductor Trainee position.  The employment documents Mr. Feltman was asked to complete included a disability self identification form.  He completed it by explaining that “technically” he has a disability but at no time has it caused him to fail to do what he wanted to do.  The Company re-opened his medical file and asked Mr. Feltman for additional information regarding any limitations he may have.  He again responded that he had no limitations.  Nevertheless the Company asked Mr. Feltman to see a foot specialist to confirm there would be no health or safety issues if he worked as a Conductor.  Mr. Feltman refused to provide any additional medical information because, he claimed, he was fully capable of performing the job.  The Company informed Mr. Feltman that without the information requested it would rescind his employment offer.

In dismissing Mr. Feltman’s claim that he was discriminated against on the basis of a disability, the Court concluded he did not demonstrate that his partially amputated right foot is an actual “disability” under the ADA because he did not show that the condition limits any of his major life activities. In fact he testified at his deposition that his condition did not limit his activities in any way, with or without the prosthesis he had available to him.

While missing limbs or partially missing limbs are often listed as an example of the type of condition that rises to the level of a disability, this case is a good reminder that examples are just that, and you must review the circumstances of each situation. A careful analysis of the employee’s specific functional limitations is necessary to determine if there is a disability that must be accommodated under the ADA.

Is obesity a disability under California law? Are a supervisor’s alleged “fat remarks” sufficient evidence of disability discrimination?  On December 21, 2017, a California Appellate Court published an extensive decision regarding obesity as a disability under California law and issued further guidance on both counts.

Ketryn Cornell was an obese woman (5’5”, 350 pounds) who was fired by her employer, Berkeley Tennis Club, after she allegedly planted a recording device attempting to tape record a board meeting. Cornell was employed as a Night Manager, Day Manager and Tennis Court Washer. Cornell alleged among other claims disability discrimination and harassment based on her obesity.

Continue Reading Obesity Discrimination Claims Allowed to Proceed Under California Law

“What did I do wrong?” and “Am I doing this correctly?” are frequent questions from clients regarding FMLA administration.  This is the twelfth in a series highlighting some of the more common mistakes employers can inadvertently make regarding FMLA administration.

Not adequately investigating a potential FMLA abuse situation to put the employer in a stronger defensive position.

While an employer may never discourage legitimate FMLA leave, if there is suspected abuse of FMLA leave, an employer should investigate. Some courts have supported an employee’s termination for FMLA abuse when the employer acted reasonably and in good faith, and could establish that there was an “honest belief” that the employee engaged in FMLA abuse.

In Capps v. Mondelez Global, LLC, Case No. 15-3839 (3d Cir. Jan. 30, 2017), an employee’s manager found in his company mailbox an anonymously-delivered newspaper clipping reporting that the employee was arrested and convicted of DUI the previous year. The company investigated and reviewed the court docket to compare dates of the employee’s court appearances with dates the employee took FMLA leave.  The date of the employee’s arrest and other court dates for the DUI proceedings matched dates the employee took FMLA leave. When asked, the employee provided documents that the employer found not to be credible. The court found that the employer had an honest belief that the employee abused FMLA, based on the correlating dates as well as the employee’s failure to provide an adequate excuse. The court stated that the employer could not be liable for FMLA interference because it “honestly believed” that the employee had abused his taking of FMLA leave.

In Gurne v. Michigan Bell Telephone Co., Case No. 10-14666 (E.D. Mich., Nov. 15, 2011), an employee took FMLA on a day she was scheduled to work until 5:00 p.m. A co-worker reported seeing the employee at a birthday party for a mutual friend between 4:30 p.m. and 6:30 p.m.  The employer investigated, but was unable to determine if the employee was actually at the party before the end of her scheduled shift. The employer nevertheless terminated the employee. The court sided with the employee, finding that the employer could not establish that it “honestly believed” that the employee had abused FMLA because the employer’s investigation was not conclusive regarding whether the employee was at the party during her shift.

An employer’s “honest belief” about FMLA abuse should be supported by adequate investigation and supporting facts. The adequacy of the investigation may be subject to legal scrutiny, and a determination can be made on whether the employer was reasonable in the steps it took to form its belief about the employee’s conduct.

For a full discussion of the Capps v. Mondelez Global, LLC case, reference the link below: https://www.disabilityleavelaw.com/2017/02/articles/fmla/third-circuit-says-last-call-employee-terminated-caught-drinking-fmla-bed-rest/#more-2507

With the turn of the year comes a wave of new California disability and leave laws.  Employers should review their existing policies and procedures to determine if they will be in compliance with these new laws—many of which will go into effect on January 1:

  • Parental Leave:  California will expand parental leave to small employers.  Current law requires that employers with 50 or more employees within 75 miles grant up to 12 weeks of unpaid leave to eligible employees who request time off to bond with a newborn child or a child placed in the employee’s home for foster care or adoption.  Effective January 1, California will extend this leave entitlement to employees who work for an employer with 20 or more employees within 75 miles.   More details can be found here.  Employers should ensure their policies are updated to account for this new leave entitlement.
    California and Local Sick Leave Laws:  Since the passage of the California Paid Sick Leave Law, various cities have enacted their own sick leave ordinances which pose additional requirements for employers.  Currently, the following cities in California have enacted sick leave ordinances: San Francisco, Los Angeles, San Diego, Oakland, Berkeley, Emeryville, and Santa Monica. Employers should revisit whether any of these ordinances apply to their organizations since very low thresholds of work trigger their application.
    Lactation Ordinance:  Effective January 1, San Francisco will expand existing federal and California laws regarding lactation in the workplace by requiring employers to provide employees with lactation rooms that are safe, clean, and free of hazardous materials; that contain a surface to place a breast pump and other personal items; that have a place to sit; and that have access to a refrigerator, sink, and electricity.  Employers should update their employee handbooks since they are now required to maintain a written lactation accommodation policy under the new ordinance.  More details about these requirements are discussed here.
  • Domestic Violence Leave Notice:  Current law requires employers with 25 or more employees to provide written notice to their employees to inform them of their rights to take protected leave for domestic violence, sexual assault, or stalking.  Employers are required to inform each employee of his or her rights upon hire and at any time upon request.  On July 1, 2017, the Labor Commissioner developed and posted online a form that employers may use to satisfy these new notice requirements.  Employers should review their new hire packets to ensure this notice is included.

Given the nuances of these new laws, employers should carefully review and revise its written policies, procedures, and new-hire packets as needed.  Please contact your Jackson Lewis attorney if you have any questions regarding your compliance with these new requirements.

The U.S. Court of Appeals for the Eleventh Circuit has affirmed a jury verdict in favor of a former Alabama police officer on her pregnancy and Family and Medical Leave Act (FMLA) claims. Hicks v. City of Tuscaloosa, Ala., No. 16-13003 (11th Cir. Sept. 7, 2017). The Eleventh Circuit held that the Pregnancy Discrimination Act (PDA) bars bias against breastfeeding mothers and affirmed an award of $161,319.92 plus costs and attorneys’ fees to the plaintiff.

Former officer Stephanie Hicks claimed that, in violation of the PDA, she was transferred to a less desirable position and forced to quit after returning from maternity leave and requesting an accommodation to breastfeed. She also sued for interference and retaliation under the FMLA, claiming that after she returned from maternity leave she overheard her supervisor commenting to her captain about finding ways to write Hicks up and “get her out of here,” apparently because Hicks had taken her full 12 weeks of unpaid leave, which was longer than her supervisor wanted.

The police department argued that Hicks was reassigned because she had not been doing her job and she failed to meet with several confidential informants assigned to her by her new boss.

The three-judge panel held there was “sufficient evidence of discrimination” by the Tuscaloosa Police Department against Hicks when she was demoted from the narcotics division to a patrol assignment a mere eight days after returning from maternity leave. Not only was Hicks assignment changed, but her pay was cut, she would no longer have a vehicle, and she was required to work weekends. Moreover, Hicks alleged she was denied an accommodation for breastfeeding and then forced to resign due to the lack of accommodation when the police department placed her on an assignment that required her to wear a bullet-proof vest.

The Court sided with the plaintiff after concluding that “[m]ultiple overheard conversations using defamatory language plus the temporal proximity of only eight days from when she returned to when she was reassigned support the inference that there was intentional discrimination.” It also noted the new job duties required Hicks, who was breastfeeding at the time, to wear a ballistic vest all day long, which she claimed wasn’t possible, and when Hicks asked to be accommodated, she was told breastfeeding was not a condition that “warranted alternative duty” and told to either wear a larger size — which left dangerous gaps — or not wear a vest at all.

The jury awarded Hicks $374,000, but a magistrate judge reduced the award to $161,319.92 plus costs and attorneys’ fees, according to the opinion. On appeal, the Eleventh Circuit found “no reversible error on any issue” to warrant overruling the jury verdict. The panel also rejected the police department’s argument that Hicks did not mitigate her damages by seeking comparable work, as well as its challenge to the jury instructions.

This case highlights the importance of, among other things, properly analyzing employees’ requests for accommodations and ensuring that employee discipline is proper and consistent both before and after an employee takes protected leave.

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While employers generally accept that they cannot apply a maximum leave period after which employees are automatically terminated, they continue to struggle with how much leave must be provided as a form of accommodation under the ADA.  There is little dispute that leave for an indefinite period where the employee has a long term chronic condition is not a reasonable accommodation, but how much time must the employer give?  Is a month of extended leave reasonable?  Two months?  Four months?

The Eleventh Circuit Court of appeals recently took a step toward providing employers with guidance on the ADA’s requirements for job protected leave as an accommodation.  In Billups v. Emerald Coast Utilities Authority, the Court noted that the accommodation language of the ADA is written in the present tense – that is, whether an employee “can” (not “will be able to”) perform the essential functions of the job with or without accommodation.  As such, when an employee seeks job protected leave as an accommodation, the employee must show that “his requested accommodation would have allowed him to return to work “in the present or in the immediate future.”  An accommodation is therefore unreasonable if it would only allow an employee work at some uncertain point in the future.

 There is nothing particularly novel about affirming the denial of leave where the return to work date is unspecified.  In the Billups case, however, the Court addressed a situation where the employee’s condition was likely to be corrected at some point in the future.  In other words, it was undisputed that the employee’s restrictions were expected to be lifted but the issue was when.  Mr. Billups was provided with over six months of leave.  At that time of his termination his surgeon indicated that he “might” be able to return to work in another month but that he had to be evaluated again.  His physical therapy was “projected” to end in about a month as well.  The Court concluded that there was only a “possibility” Mr. Billups could return to work in a month but there was “no certainty” that he could do so.  Because of the lack of certainty the Court concluded that this was effectively an open ended request for sufficient time to ameliorate Mr. Billups’ condition and he therefore was not denied a reasonable accommodation.

 Employers must continue to exercise extreme caution in these situations.  While the Court in Billings focused on the lack of certainty about the employee’s return to work date, employers must be careful not to take this concept too far.  As those who practice in this area know, every situation is unique and must be treated as such.

The U.S. District Court for the Middle District of Pennsylvania recently upheld an employer’s decision to terminate an employee under its policy against excessive absenteeism, in spite of the fact that the former employee had previously taken leave under the Family and Medical Leave Act (“FMLA”), because the absences at issue were not related to her FMLA qualified condition. See Bertig v. Julia Ribaudo Healthcare Grp., LLC, 2017 WH Cases2d 390378 (M.D. PA 2017).

The employee in this case worked as a nurses’ aid in a nursing home. She also was diagnosed with bladder cancer and asthma during her employment.  The employee completed the necessary FMLA paperwork relating to these conditions and took FMLA leave from May 29, 2012 to June 25, 2012.  However, during the next year, the employee missed an additional thirteen days of work.  According to the employer’s call-in records, the absences were for various reasons, i.e. foot pain, stress fracture in her foot, common cold, sore throat, etc.; however, none of the absences were related to either of her FMLA qualifying conditions.

The employer had a company policy which stated that termination may occur when an employee accrues seven absences within a twelve month period. After identifying that the employee had violated this policy with her thirteen absences, the employee was contacted and informed that she was being terminated for excessive absences.  The employee filed a complaint on November 19, 2015 asserting causes of action for interference and retaliation under the FMLA and disability discrimination and failure to accommodate under the Americans with Disabilities Act (“ADA”).  The employer subsequently filed a motion for summary judgment.

The Court analyzed the requirements for both FMLA interference and retaliation claims and found that the employee’s claims under both causes of action failed because the evidence showed that, although she was entitled to FMLA leave for medical issues relating to both the bladder cancer and asthma, her own stated reasons for the absences showed that the absences were completely unrelated to either of these medical diagnosis. Instead, the employee’s absences were due to foot pain, common cold, etc.  None of these ailments entitled the employee to FMLA leave.  Therefore, the Court held that the employee’s FMLA causes of action should be dismissed.

The Court next analyzed the employee’s claims under the ADA and determined that, although she qualified as a disabled person under the ADA, her claims failed because she failed to establish that the employer’s decision to terminate her was based on her disability. Furthermore, the Court found that the employee failed to request any additional FMLA leave, so there was no retaliation by the employer.  In addition, there was no evidence that the employee ever sought an accommodation from the employer for her disabilities.  Because no accommodation was ever sought, she could not bring a failure to accommodate claim under the ADA.

The takeaway for employers is that you aren’t prevented from following your policies and procedures against excessive absenteeism just because an employee has previously taken FMLA leave. If the employee’s reasons for the absences are not related to the FMLA qualifying condition, then you are entitled to proceed with your disciplinary procedures for excessive absenteeism.  The entitlement to FMLA leave is not a free ticket for missing work for non-FMLA covered absences.

Employees requesting, currently taking, or just returning from leave under the Family and Medical Leave Act (“FMLA”) can be terminated for legitimate reasons that are unrelated to their FMLA leave. This point is exemplified by Jennings v. Univ. of N.C., N.C. Ct. App., Case No. COA16-1031 (July 5, 2017), which was the subject of a prior post on this Blog.  In Jennings, the North Carolina Court of Appeals ruled that an employer did not violate the FMLA by proceeding with a disciplinary hearing and termination of an employee because of allegations of misconduct that arose prior to her FMLA leave.

Timing is everything in life, however, and the timing of an employer’s investigation of misconduct by an employee in relation to the employee’s request for leave is significant. The Western District of Missouri’s denial of summary judgment in Diamond v. American Family Mutual Insurance Company, Case No. 4:16-cv-00977 (Nov. 9, 2017), illustrates this point.  Diamond, a claims adjuster for American Family Mutual (“AFM”), met with his supervisor on February 12, 2015 for his annual performance review, which was positive.  During that meeting, Diamond told his supervisor that he was planning to take FMLA leave.  The next day, Diamond’s supervisor pulled phone records to investigate if Diamond had actually made calls that he reported making.  The supervisor testified the investigation was prompted by complaints in January and February 2015 from insureds and agents who reported they had not received follow-up calls or call-backs from Diamond.  After the supervisor determined that Diamond’s claim file entries were inconsistent with the report of calls made from his desk phone, Diamond was terminated for falsifying company records on February 24, 2015.

In denying AFM’s summary judgment motion, the court acknowledged that the FMLA does not prohibit an employer from terminating an employee for reasons unrelated to the FMLA, and the court also acknowledged that falsifying records is a lawful reason for termination. However, the court found there were issues of fact as to the reasons for Diamond’s termination, noting that Diamond’s phone records were pulled the day after he expressed his intent to take FMLA leave and that Diamond had received a favorable performance review the day before his records were pulled.

The Diamond decision serves as an important reminder that employers must be extremely cautious when disciplining employees who have recently requested, taken, or returned from FMLA leave.  While discipline is lawful if unrelated to the request, courts will be skeptical if there is evidence that the employer began looking for misconduct after the FMLA leave request was made.  Additionally, Diamond is a good reminder that employers should ensure that performance reviews are accurate and consistent with any concerns regarding an employee’s performance and conduct.