Jim Shore
Jim Shore is a partner of Stoel Rives, LLP, where he works out of the Seattle office. Jim’s practice is exclusively focused on representing businesses and entrepreneurs in labor and employment law, with an emphasis on restrictive covenant/trade secret issues, unfair competition, traditional labor law (employer dealings with unions), harassment and discrimination litigation, assisting employers with day-to-day employment advice and policies, and issues related to corporate restructuring and acquisitions. Jim actively practices before federal and state courts and agencies throughout the western United States, and is an active member of the Washington, California and Oregon bars. Jim was named by Washington CEO Magazine as one of the top 10 labor and employment attorneys in Washington State, ranked as a leading Washington Labor and Employment attorney by Chambers USA (2008 and 2009), and by his peers as a Washington “Super Lawyer” in Washington Law and Politics Magazine. Jim is also “AV” rated by Martindale-Hubbell.
Update - New Rule Requires Employers to Post Notice of Employee NLRA Rights
In order to allow more time for legal challenges to its notice-posting rule to be resolved, the National Labor Relations Board has again postponed the rule's effective date, this time to April 30, 2012. Stay tuned.
For additional information regarding the NLRB's new rule and posting requirement, including links to the new rule and the poster employers must post, see our prior post on this topic by following this link.
New Rule Requires Employers to Post Notice of Employee NLRA Rights
Your bulletin board full of required workplace postings just got more crowded. The National Labor Relations Board (“NLRB”) has issued a final rule that will require nearly all private sector employers, whether unionized or not, to post a notice to their employees about certain employee rights under the National Labor Relations Act (“NLRA”). The notice must be posted by no later than November 14, 2011 (now postponed until January 31, 2012, see update below). The new rule is one of many new developments arising from the current NLRB’s implementation of the Obama administration’s labor policy.
This new notice is a form designed by the NLRB. Among other things, it contains:
· A summary of employee rights under the NLRA, including the right to discuss wages and working conditions with co-workers or a union, form or join a union, take collective action to improve working conditions, and engage in other protected activities.
· Examples of violations of those rights, and an affirmation that unlawful conduct will not be permitted.
· Information about the NLRB, the NLRB’s contact information, and details on how to file an unfair labor practice charge with the NLRB.
· A statement about the employer's obligation to bargain in good faith if a union has been selected by employees.
This new rule applies to almost all employers except public sector employers, very small employers below the NLRB’s jurisdictional standard for impacting interstate commerce, and other limited classes of employers outside of the NLRA’s jurisdiction. The NLRB may find that an employer’s failure to post the notice constitutes an unfair labor practice. The remedy for a violation may not be severe because the NLRB cannot impose fines – but much worse, a violation can be evidence of unlawful motive and prevent the running of the statute of limitations.
The full text of the actual required notice is available here. Private sector employers will be required to post this notice in conspicuous places, including where they customarily post other workplace notices. In addition, employers who customarily post personnel policies and rules on an internet or intranet site must include this new notice there or provide a link to the NLRB’s website section containing the notice. If an employer has employees working at another employer’s site, it will also need to determine whether it can post notices at that site if the other employer does not already have the notice posted. If 20 percent or more of an employer’s employees are not proficient in English and speak the same foreign language, the notice must also be posted in that language. The NLRB will provide translations in such circumstances. Copies of the required 11x17 posters will be available at no cost from the NLRB upon request, and will also be downloadable from the NLRB’s website, www.nlrb.gov. A federal contractor will be regarded as complying with the NLRB’s new posting requirement if it already posts the notice required of federal contractors by the U.S. Department of Labor. See our earlier discussion of those posting requirements here.
The NLRB fact sheet with further information about the rule is available here. There are likely to be legal challenges to the NLRB’s new notice posting rule, and at least one bill has already been introduced in Congress seeking to invalidate it. For now, employers will need to be prepared to comply with the new posting requirement. While already unionized employers will likely see little impact from the new rule other than the actual posting requirement itself, non-unionized employers may be faced with employees raising questions about their rights under the NLRA. Because such questions will invariably be directed toward their immediate supervisors, it is important for non-unionized employers to make sure that supervisors are properly trained regarding how to maintain a union-free environment without violating the NLRA. Non-unionized employers might also be tempted to post their own notice alongside the new NLRB poster, advising employees why a union is not needed. As with all such efforts, missteps can lead to challenges before the NLRB, so employers should consult with their Stoel Rives labor attorney.
UPDATE: On September 14, 2011, the NLRB made available the poster that employers must post. The link to that poster is here. The NLRB recently postponed the implementation date for its new notice-posting rule by more than two months in order to allow for enhanced education and outreach to employers. See here. The new effective date of the rule, and the date by which the new notice must be posted, is January 31, 2012.
Victory For Employers in Washington Medical Marijuana Case
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In a victory for employers, the Washington Supreme Court has ruled that Washington’s Medical Use of Marijuana Act (“MUMA”) does not protect medical marijuana users from adverse hiring or disciplinary decisions based on an employer’s drug test policy. Click here to download a copy of the decision in Roe v. Teletech Customer Care Management. The lawsuit and all appeals were handled for the employer by Stoel Rives attorneys Jim Shore and Molly Daily.
Jane Roe (who did not use her real name because medical marijuana use is illegal under federal law) sued Teletech for terminating her employment after she failed a drug test required by Teletech’s substance abuse policy. She alleged that she had been wrongfully terminated in violation of public policy and MUMA since her marijuana use was “protected” by MUMA. The trial court granted summary judgment in favor of Teletech, and Roe appealed. As discussed in a previous blog, the Washington Court of Appeals, Division II affirmed the trial court’s dismissal of Roe’s case. Roe then appealed to the Washington Supreme Court.
The Supreme Court ruled 8-1 in favor of in Teletech, holding that MUMA provides an affirmative defense to state criminal prosecutions of qualified medical marijuana users, but “does not provide a private cause of action for discharge of an employee who uses medical marijuana, either expressly or impliedly, nor does MUMA create a clear public policy that would support a claim for wrongful discharge in violation of such a policy.” The Court’s holding applies regardless of whether the employee’s marijuana use was while working or while off-site during non-work time. Adding to a significant victory for employers, the Court’s decision extends to the current version of MUMA as amended by the Legislature in 2007, and not just the original version passed by the voters in 1998 in effect when the facts of the case arose.
The plaintiff in the Teletech case did not raise a disability discrimination or reasonable accommodation claim under Washington’s Law Against Discrimination, and the Supreme Court therefore did not expressly reach that particular issue. But the Court did point out that marijuana remains illegal under federal law regardless of what the State of Washington does, and that it would be incongruous “to allow an employee to engage in illegal activity” in the process of finding a public policy exception to the at-will-employment doctrine. Moreover, the Court noted that the Washington State Human Rights Commission itself acknowledges that “it would not be a reasonable accommodation of a disability for an employer to violate federal law, or allow an employee to violate federal law, by employing a person who uses medical marijuana.”
The workplace implications of medical marijuana continue to be a developing area in many states. California’s Supreme Court has ruled in a manner consistent with Washington. Also previously covered in World of Employment, in Emerald Steel Fabricators, Inc. v. Bureau of Labor & Industries, the Oregon Supreme Court ruled that because federal criminal law preempts Oregon’s medical marijuana law, employers in Oregon do not have to accommodate employees' use of medical marijuana. But some states are more protective of an employee’s medical marijuana use. Given the continued efforts by marijuana advocates and civil rights groups to “push the envelope” of medical marijuana laws into the workplace, it is important for employers to continue to closely monitor legislative and legal developments. A recent effort to include workplace protections for medical marijuana users via amendments to Washington’s medical marijuana laws was defeated, but we anticipate similar efforts may be made in other states in the coming years.
There are many sound reasons why employers have zero tolerance policies and engage in drug testing of applicants and/or employees, including customer requirements, government contracting requirements (e.g.,the federal Drug Free Workplace Act), federal or state laws (including DOT requirements for transportation workers), workplace safety, productivity, health and absenteeism, and liability. To best protect themselves, employers should review their policies to make sure that illegal drug use under both state and federal law is prohibited, and that their policies prohibit any detectable amount of illegal drugs as opposed to an “under the influence” standard. Employers should also ensure that all levels of their human resources personnel know how to handle medical marijuana issues as they arise.
Medical Marijuana and Zero Tolerance Drug Testing Policies Remain An Issue For Employers
Employers and the courts continue to wrestle with issues involving “zero tolerance” drug testing policies and whether employers must accommodate medical marijuana use by their employees. Marijuana use is illegal under the federal Controlled Substances Act, and therefore does not need to be accommodated under the federal Americans with Disabilities Act (“ADA”). However, 15 states currently have legalized some form or another of medical marijuana use: Alaska, Arizona, California, Colorado, Hawaii, Maine, Michigan, Montana, Nevada, New Jersey, New Mexico, Oregon, Rhode Island, Vermont, Washington as well as the District of Columbia. The language of each state’s law can differ, and the courts therefore interpret these state law issues on a case-by-case basis.
Most recently, in Casias v. Wal-Mart Stores, Inc., a Michigan federal district court ruled that an employee who was terminated by Wal-Mart after testing positive for validly obtained medical marijuana stated no legal claims for wrongful discharge. The court accepted Wal-Mart’s argument that Michigan’s medical marijuana law does not regulate private employment; rather, it merely provides a potential affirmative defense to criminal prosecution or other adverse action by the state. The court rejected the plaintiff’s argument that the law created a new protected employee class, which “would mark a radical departure from the general rule of at-will employment in Michigan.” The Casias decision is currently being appealed.
A similar ruling is under review by the Washington State Supreme Court. I argued the case for the employer on January 18, 2011. As I previously blogged, the Washington Court of Appeals in Roe v. Teletech Customer Care Management affirmed a trial court’s ruling and held that Washington’s Medical Use of Marijuana Act (“MUMA”) does not protect medical marijuana users from adverse hiring or disciplinary decisions based on an employer’s drug test policy. In so doing, the Court of Appeals stated, “MUMA neither grants employment rights for qualifying users nor creates civil remedies for alleged violations of the Act.” Rather, the Court held that MUMA merely protects qualified patients and their physicians from state criminal prosecution related to the authorized use of medical marijuana. The Court further held that when Washington’s voters passed MUMA through the initiative process, they did not intend to impose a duty on employers to accommodate employee use of medical marijuana. A decision from the Washington Supreme Court is anticipated later this year.
Three other state Supreme Courts have already issued rulings on workplace medical marijuana issues, and all have found in the employer’s favor. In Ross v. RagingWire, the California Supreme Court ruled that it is not discrimination to fire an employee for using medical marijuana. The court held that employers in California do not need to accommodate the use of medical marijuana, even when users only ingest or smoke marijuana away from the workplace.
In Johnson v. Columbia Falls Aluminum Company, the Montana Supreme Court ruled, in an unpublished decision, that an employer is not required to accommodate an employee's use of medical marijuana under the federal ADA or the Montana Human Rights Act.
Also previously covered on World of Employment, in Emerald Steel Fabricators, Inc. v. Bureau of Labor & Industries, the Oregon Supreme Court ruled that because federal criminal law takes precedence over Oregon’s medical marijuana law, employers in Oregon do not have to accommodate employees' use of medical marijuana. Stoel Rives filed a “friend of the court” brief on behalf of the employer in that case.
There are many sound reasons why employers have zero tolerance policies and engage in drug testing of applicants and/or employees, including, without limitation, customer requirements, government contracting requirements (including the federal Drug Free Workplace Act), federal or state laws (including DOT requirements for transportation workers), workplace safety, productivity, health and absenteeism, and liability. To best protect themselves, employers should review their policies to make sure that illegal drug use under both state and federal law are prohibited, and that their policies prohibit any detectable amount of illegal drugs in an applicant’s or employee’s system as opposed to using an “under the influence” standard. Employers should also ensure that all levels of their human resources personnel know how to handle medical marijuana issues as they arise. Finally, given the continued efforts by marijuana advocates and civil rights groups to “push the envelope” of medical marijuana laws into the workplace, it is important for employers to continue to closely monitor legislative and legal developments. A recent effort to include workplace protections for medical marijuana users via amendments to Washington’s medical marijuana laws was defeated, but we anticipate similar efforts will be made in Washington and other states in the coming years.
Supreme Court issues Favorable Ruling for Employers in Texting/Privacy Case
Yesterday the United States Supreme Court issued a long-anticipated decision in City of Ontario v. Quon, unanimously ruling that a search of sexually explicit personal text messages sent by a police officer using his department pager was reasonable and did not violate the individual officer’s privacy rights. At issue was the right of a government employer to monitor its workers private communications because it believed employer-owned equipment was being abused. Even if a public employee has a legitimate privacy expectation, an employer’s intrusion on that expectation “for noninvestigatory, work-related purposes, as well as for investigations of work-related misconduct, should be judged by the standard of reasonableness under all the circumstances,” Justice Anthony Kennedy wrote. Click here to read the Supreme Court’s full decision in Quon.
In Quon, the employer, the City of Ontario, distributed to its police officers pagers with texting capability. The City audited the use of text messages by the officers to determine whether coverage charges may have been caused by personal use of the service. During the audit, it discovered that Quon had sent several personal, sexually explicit text messages. Quon sued the City, asserting violations of his right to privacy under the Fourth Amendment of the United States Constitution as well as under Article I, Section I of the California Constitution. The federal District Court dismissed Quon's suit after a jury found that the City conducted the audit to investigate usage, not misconduct. The Ninth Circuit Court of Appeals reversed, holding that the City violated Quon's constitutional privacy rights by reading his private texts, and the City's articulated policies did not give Quon sufficient notice that his texts could be read by others to overcome his privacy rights. The Ninth Circuit’s decision, which we blogged on the World of Employment, was unanimously overturned by the Supreme Court.
What does the Supreme Court’s decision mean for employers? The Supreme Court issued a narrow ruling in a case involving a public, not private, employer. For most private employers, this case could have little or even no impact because federal privacy rights such as those that come from the U.S. Constitution’s Fourth Amendment apply only to public, and not private, employers. Justice Kennedy cautioned that even with regard to public employers, the “Judiciary risks error by elaborating too fully on the Fourth Amendment implications of technology before its role in society has become clear . . . .” Private California employers should continue to be wary: California courts have sometimes applied state constitutional rights to private employers, and could rule that their employees have privacy rights in work-provided email and text systems. For all employers, whether or not the Fourth Amendment applies to them, it remains a “best practice” to adopt and distribute policies clearly stating that employees have no expectation of privacy in employer-owned equipment, or in communications they make using or interfacing with employer-provided equipment and systems, such as email, text messages, cell phones, social media and other avenues of technology.
Washington Court of Appeals Upholds Termination Where Medical Marijuana Use Caused Drug Test Failure
Note: On April 1, 2010, the Washington Supreme Court granted review of the Court of Appeals decision discussed in this entry. A final ruling on the case will be issued by the Washington Supreme Court at a later date.
A Washington Court of Appeals has ruled that Washington’s Medical Use of Marijuana Act (“MUMA”) does not protect medical marijuana users from adverse hiring or disciplinary decisions based on an employer’s drug test policy. Click here to download a copy of the Court of Appeals Decision in Roe v. Teletech Customer Care Management.
Jane Roe (who did not use her real name because medical marijuana use remains illegal under federal law) sued Teletech for rescinding its employment offer after she failed a drug test required by Teletech’s substance abuse policy. She sought reinstatement and damages, alleging that she had been wrongfully terminated in violation of public policy since her marijuana use was legal under MUMA. The trial court granted summary judgment in favor of Teletech, and Roe appealed.
The Washington Court of Appeals, Division II affirmed the trial court’s dismissal of Roe’s case, stating, “MUMA neither grants employment rights for qualifying users nor creates civil remedies for alleged violations of the Act." Rather, the Court held that MUMA merely protects qualified patients and their physicians from state (not federal) criminal prosecution related to the prescribed use of medical marijuana. The Court further held that when Washington’s voters passed MUMA through the initiative process, they did not intend to impose a duty on employers to accommodate employee use of medical marijuana. The lawsuit and appeal, handled for the employer by Stoel Rives attorneys Jim Shore and Molly Daily, is likely to be further appealed by Roe to the Washington Supreme Court.
The workplace implications of medical marijuana continues to be a developing area. If your company has employees in any state allowing the use of medical marijuana under certain circumstances (including Washington, Oregon and California), you should review your substance abuse policies and make certain that all local human resources personnel and drug test administrators know whether the company will consider an exception for medical marijuana usage. Currently, Washington employers do not need to accommodate medical marijuana usage by making an exception to an otherwise valid substance abuse policy. However, because of court rulings in other states interpreting their states’ disability laws and advocacy groups’ continued attempts to expand medical marijuana rights, employers should continue to exercise caution when dealing with requests for disability accommodation involving medical marijuana. If such an issue arises, consider consulting with legal counsel.
Washington Supreme Court Upholds Employer's Right to Fire Workers who Protest Bad Boss
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Sometimes the Washington Supreme Court pleasantly surprises employers. Today is one of those days. The Court issued its decision today in Briggs v. Nova Services. The plaintiffs in this case were eight employees of Nova Services, a non-profit social services organization in Washington. The employees apparently had major problems with the executive director who was appointed by the board, Linda Brennan. They sent a letter to the board expressing their disapproval with Ms. Brennan’s job performance. They explained that she “left managers to do work in isolation, failed to delegate authority well, did not hire needed staff, failed to foster open communication, and was poor at managing finances.” The board hired a lawyer who confirmed that regardless of whether Ms. Brennan was a decent manager, she had done nothing illegal. He suggested that the board either fire Ms. Brennan or the two employees who were the ringleaders of the disgruntled group, Ken Briggs and Judy Robertson, because their animosity clearly ran too deep to foster a positive working environment. The board decided to let Ms. Brennan stay. After an unsuccessful attempt to mediate their dispute, Ms. Brennan ultimately fired Briggs and Robertson. The other six employees responded by writing another letter to the board protesting the firing of Briggs and Robertson and threatening, in essence, unless Brennan is fired and Briggs and Robertson are reinstated, we quit. The employees gave the board one day to respond and stated that the deal was “non-negotiable.” The board did not respond and the employees did not report to work.
The at-will employees sued for wrongful discharge in violation of public policy. This cause of action is a narrow exception to the at-will employment doctrine. It only applies where an employee is fired for something like refusing to engage in an illegal act, performing a public obligation like jury duty, exercising a legal right like voting, or in retaliation for reporting employer misconduct (whistle blowing). Relying on RCW 49.32.020, the employees argued that Washington law, like the federal labor laws, protects employees’ rights to engage in concerted activities. In essence, this law protects non-union employees who work together to complain/negotiate/bargain with their employers over terms and conditions of employment. The Court determined that RCW 49.32.020 was not meant to apply to this context of a protest walk out over the firing of two employees and the retention of a disliked boss. The Court focused on the idea that “working conditions includes things like better wages, improved medical coverage, better treatment from supervisors, lunch and rest breaks, layoffs and recalls, production quotas, work rules, on the job harassment, and even food prices at in-plant dining rooms.” The Court determined that management decisions which “lie at the heart of entrepreneurial control” are not terms and conditions of employment. Thus Nova’s decision to replace the employees who walked out in protest was not a wrongful termination in violation of public policy. There was a dissent which focused more on federal labor laws as persuasive. Under federal law, this case might have come out differently. There were also two concurring opinions. Justice Madsen’s opinion focused on the fact that the plaintiffs never raised the RCW 49.32.020 issue until the appeal, which is arguably way too late to bring it up. Justice Johnson’s opinion was a bit more complicated but essentially argued that the Court mixed up two completely separate issues, the wrongful discharge tort and the protected concerted activity statute. He agreed that complaining about a bad boss is not protected.
The bottom line for employers is that in Washington, it is not necessarily “protected concerted activity” (and that is a legal term of art to be discussed with your labor lawyer when necessary) for employees to protest everything in the workplace. There are still going to be some workplace issues that are clearly terms and conditions of employment. Employees can band together to complain about these issues. Other workplace concerns may not be safe for at-will employees to protest. One such concern is clearly who’s the boss. With support from today’s decision, there will be others. Before taking any action in response to employees who act collectively, however, it would be very prudent to consult an experienced labor lawyer.
New proposed rule from Homeland Security will rescind the controversial no-match rule
One of G.W. Bush’s controversial acts as president was issuing the no-match rule. When employers pay social security taxes, the Social Security Administration (SSA) allocates a certain amount to each employee based on that employee’s social security number. All is well and good when the employer provided numbers match the numbers on file with the SSA. When the numbers don’t match, the SSA sends an aptly named no-match letter. The Bush administration’s no-match rule would have required theDepartment of Homeland Security (DHS) to send its own letter to employers along with the no-match letters from the SSA. The DHS letters, rather than simply stating that the numbers didn’t match, would contain a threat to fix the problem or face liability. As a practical matter, most employers receiving such a letter would opt to terminate the employee at issue rather than face liability.
The real problem with this rule is that just because an employee’s social security number, provided on an I-9 card for example, does not match the number on file with the SSA does not mean the employee is an illegal alien. The SSA’s record keeping is not perfect and the no-match might not be the employee’s fault. Moreover, typos are not uncommon in this context and many no-match situations are the result of accidentally switching a single number. In other words, a no-match does not equal an illegal worker. Terminating employment solely on the basis of receiving a no-match letter could expose employers to liability for wrongful termination.
The DHS has a deadline of September 30, 2009 to rescind the no-match rule. If it rescinds the rule before that date it will not run afoul of the bill recently passed in the Senate prohibiting using any part of next year’s appropriated homeland security funds to rescind the rule. The DHS has indicated that it intends to rescind the rule and focus on assuring employer compliance through programs such as E-Verify.
The bottom line for employers - compliance with immigration laws is just as important as ever, but if the rule is rescinded a no-match letter from the SSA should result in a discussion with the employee, perhaps obtaining another copy of their social security card and checking their I-9 form.
Washington Supreme Court Decides Morgan v. Kingen - Bankruptcy is No Defense
The Washington Supreme Court issued a decision today in Morgan v. Kingen, holding that bankruptcy is not a valid defense to a willful withholding of wages under RCW 49.52.070. The plaintiffs in this case worked at Funsters Grand Casino in SeaTac, Washington. The casino was not a success and the owners voluntarily filed for Chapter 11 bankruptcy after only one year in business. After it became clear that the owners were not going to inject badly needed capital, the bankruptcy court converted the proceedings to a complete liquidation under Chapter 7. After the conversion, the owners couldn't have paid their employees even if they had wanted to (at least from the seized Funster assets).
The plaintiffs brought a class action lawsuit on behalf of over 180 employees to recover unpaid wages. The owners of the bankrupt casino argued that while the wages were admittedly owed, the withholding was not willful because the assets were seized in bankruptcy. This distinction is crucially important because willful withholding of wages allows a plaintiff to recover double damages, attorneys' fees and exposes the withholder to personal liability. The owners of the bankrupt casino were thus personally liable for twice the amount of all the unpaid wages plus attorneys' fees unless they could assert a bankruptcy defense. They tried. They failed at the trial level, the appellate level, and as of today, at the Washington Supreme Court as well. Justice Sanders dissented, noting that the owners could not have paid as their assets were seized and unavailable. He was joined by Justice Johnson and Justice Sweeney, pro tem.
The bottom line for businesses in Washington remains unchanged by this decision. A financial inability to pay wages does not constitute a defense to a willful withholding of wages. Today's decision establishes that even a complete liquidation in bankruptcy is no defense. The lesson? If your business is failing and it looks like there may not be enough assets to satisfy all the looming creditors, you might want to seriously consider paying wages before anything else.
Supreme Court Agrees to Hear Case About Meddling International Union
The US Supreme Court just agreed to hear a case asking just how much international unions will be allowed to meddle in the affairs of their local affiliates. In Granite Rock v. Teamsters, the employer sued the International Brotherhood of Teamsters in federal court claiming that the International interfered with the relationship between the employer and the Local Teamsters union.
In Granite, the employer and the Local had reached a tentative new agreement which contained a no-strike clause. The employer alleged that the Local ratified the agreement and then engaged in a strike. Apparently a high ranking official of the International was the motivating force behind the strike. The 9th Circuit held that the employer could not sue the International because the agreement was between the employer and the Local, and did not involve the International. The Supreme Court granted cert and will hear the case, perhaps recognizing that international unions are often working behind the scenes with their local unions.
The Court will probably not hear the case until the 2010 session, and it could be some time before an opinion is issued. It is not uncommon for employers to have good relationships with local unions. Sometimes those relationships are strained through pressure from out-of-town international union officials. Currently, international unions are somewhat insulated from liability for meddling in negotiations and other ongoing business relationships between local unions and employers. Ultimately, this decision could open a new legal avenue for employers to hold international unions accountable for their actions.
