Court Reaffirms Burden of Proof for Retaliatory Discharge Claims

gavelpictureIn Phillips v. Continental Tire, the federal Court of Appeals sitting in Chicago confirmed that to prove retaliatory discharge under Illinois law, an employee must establish that he was terminated “primarily in retaliation for” his protected activity. The court found that it wasn’t enough that the employee’s protected activity (here, filing a worker’s comp claim) set into motion a string of events that ended in termination.

Continental Tire’s policy required that an employee submitting a worker’s compensation claim to submit to a drug test and provided that failure to do so would result in termination. Jeff Phillips tried to file worker’s compensation but refused to submit to a drug test. Continental Tire terminated his employment for refusing the drug test and Phillips sued claiming retaliatory discharge on the theory that because the drug test was triggered by his worker’s comp claim, they were “causally related.”  The Seventh Circuit rejected Phillips’ argument, finding that “[c]ausation requires more than a discharge in connection with filing a claim” — “[t]o establish causation, the employee must affirmatively show that the discharge was primarily in retaliation for [his] exercise of a protected right.”

We’ve recently seen a small uptick in worker’s compensation retaliation claims, so the Phillips decision is a helpful reminder of the high bar for establishing retaliatory discharge. Still, employers should take extra care in terminating an employee who has filed a worker’s comp claim or engaged in other protected activity.

Illinois Supreme Court Upholds Constitutionality of the Employee Classification Act

gavelpictureOn February 21, 2014, in Bartlow v. Costigan , the Illinois Supreme Court unanimously upheld the constitutionality of the Employee Classification Act (ECA).

The ECA is aimed at cracking down on misclassification of employees as independent contractors in the construction industry. The ECA deems an individual performing services for a “contractor” as an employee of the contractor unless the individual can meet certain specific tests (e.g., is the individual free from the direction and control of the contractor? Is the service performed by the individual outside the usual course of services performed by the contractor?). A “contractor” is any person or firm “who engages in construction.”  One of the complaints from employers about the ECA is that “construction” is broadly defined to include everything from “maintenance” and “landscaping” to more traditional construction tasks such as “remodeling,” “wrecking,” and “refurbishing.”

The Bartlow case hinged on whether or not the ECA was impermissibly vague and violated procedural due process rights.  After years of back and forth in lower courts, the Supreme Court rejected all of the plaintiff’s constitutional challenges.  With regard to the plaintiff’s vagueness argument, the court held that “a person of ordinary intelligence could understand the conduct prohibited under the act” and that recent amendments to the law essentially rendered the plaintiff’s other concerns moot.

Employers who were hoping the law might be repealed or modified by the state legislature or overturned by the Illinois Supreme Court need to recognize that it is here to stay.  If your business is connected in any way to the construction industry, as broadly defined under the statute, you need to scrutinize your use of independent contractors to ensure it is in compliance with the ECA.

EEOC Files Suit Over Separation Agreement Language

The EEOC filed suit Friday in U.S. District Court for the Northern District of Illinois claiming that CVS Pharmacy violated Title VII by using separation agreements that allegedly limited the rights of employees to communicate with the agency, file charges, and participate in investigations (EEOC v. CVS Pharmacy Inc., Civil Action No. 1:14-CV-683).  EEOC ImageThe EEOC specifically took issue with provisions in the separation agreements requiring employees to notify CVS if they receive a subpoena, deposition notice, interview request, or other inquiry from any investigator, attorney, or other third party; prohibiting employees from disparaging the company; prohibiting employees from disclosing confidential information; releasing “charges” against the company relating to “unlawful discrimination;” and agreeing not to sue the company.  As one of the remedies requested, the EEOC wants the court to give employees who were subject to the agreements the opportunity to file a charge within three hundred days, basically restarting their limitations period.  If the case moves forward, it will be interesting to see whether the court agrees with the EEOC’s position.  After all, the employees who signed the agreements presumably did so precisely because they had no intention of taking any sort of legal action against CVS.  Unfortunately, these types of cases often get settled early, allowing the EEOC to declare victory, but leaving employers uncertain about the law governing their agreements.    

Are You Ready for 2014?

checkLaws are always changing and can sneak up on even the most aware companies. Each year, LP’s Labor & Employment Practice Group is pleased to offer a short checklist of items all companies should consider to improve their readiness, avoid litigation, meet compliance obligations, and stay current with best practices in 2014. We hope you find this 2014 Labor and Employment Law Compliance Checklist to be a helpful guide for the year ahead.

2014 Labor and Employment Law Compliance Checklist

Company Handbook Items Draw NLRB Scrutiny

EmployeeHandbookThe National Labor Relations Board is drawing a lot attention from the media for its recent crackdowns on companies’ social media policies, but the NLRB has increasingly been scrutinizing other common policies in non-union companies’ employee handbooks.  Guidelines on keeping information confidential, being courteous in the workplace, not disparaging the company or supervisors, and resolving disputes are all under the NLRB’s microscope. The key, in the NLRB’s eyes, is whether the policy would limit employees’ right to “engage in concerted activity” (which includes everything from two employees discussing the workplace to a group of employees forming a union) or suggests that employees can’t engage in collective bargaining.  So, for instance, the NLRB has taken issue with confidentiality policies that prohibit the sharing of information regarding other employees because sharing employee information is a key step in organizing.  Similarly, the NLRB has taken action against non-union companies that prohibit employees from disparaging co-workers or the company, because employees have a right to share their grievances about the workplace.  There is no question that the NLRB is continuing to assert itself in non-union workplaces. Employers can look forward to more NLRB cases claiming that standard handbook policies violate the National Labor Relations Act.  If you haven’t recently reviewed your employee handbook and policies with an eye toward these issues, it makes sense to do so before you find yourself in the NLRB’s crosshairs.