The Occupational Safety and Health Administration (OSHA) issued an interim final rule and request for comments regarding procedures for handling employee whistleblower complaints under the Affordable Care Act (ACA), Section 1558. This part of the ACA added a new Section 18c to the Fair Labor Standards Act (FLSA), which protects employees from retaliation for exercising certain rights under the ACA, including (1) receiving a federal tax credit or subsidy to purchase insurance through the employer or a future health insurance exchange, (2) reporting a violation of consumer protection rules under the ACA (which, for instance, prohibit denial of health coverage based on preexisting conditions and lifetime limits on coverage), and (3) assisting or participating in a proceeding under Section 1558.
The interim final rule states the time frames and procedures for bringing a whistleblower complaint under Section 18c and covers the investigation, hearing, and appeals processes. An employee has 180 days from the date of the alleged retaliation to bring a whistleblower complaint to the Secretary of Labor. Where a violation is found, remedies can include reinstatement, compensatory damages, back pay, and reasonable costs and expenses (including attorneys’ fees). If the employee brought the complaint in bad faith, an employer may recover up to $1,000 in reasonable attorneys’ fees.
The bar for an employee bringing such a complaint is relatively low, and the bar for an employer defending against the complaint is relatively high. The employee must only have a subjective, good-faith, reasonable belief that the conduct alleged in the complaint violates the whistleblower protections; the employee need not prove that the conduct was an actual violation of law. The conduct complained of must only be a contributing factor in an adverse employment decision for the employee to make his or her case. The employer must then demonstrate through clear and convincing evidence that it would have taken the same adverse action without the protected activity.
Each party has 20 days after filing the complaint to submit a position statement and supporting documents, and can also request a meeting to present its position to OSHA. OSHA has 60 days from the filing of the complaint to investigate and issue written findings and, if a violation is found, a preliminary order providing relief to the employee. There is a process to challenge and appeal OSHA’s written findings and order. There is also a process for an employee to file a complaint in federal court either within 90 days after the employee receives OSHA’s findings, or if no final agency order is issued within 210 days of the filing of the complaint.
For more information, see the DOL fact sheet, which describes how to file a complaint. If you have comments on this interim final rule, they must be submitted within 60 days of the rule’s publication in the Federal Register (Feb. 27, 2013). Comments may be submitted electronically at the eRulemaking portal.
Most employers grapple with the better-known aspects of the Family and Medical Leave Act (FMLA), such as determining whether an employee’s illness constitutes a serious medical condition, obtaining required certification or providing adequate coverage for workers on intermittent leave. All too often employers focus on the leave itself and breathe a sigh of relief when notice is provided confirming the dates of leave or when the employee has resumed his or her usual schedule. But an employer’s compliance with federal law includes the obligation to maintain adequate records related to the leave. Failure to do so can have significant consequences.
What Records Must You Keep?
FMLA recordkeeping requirements can be found in a single regulation, 29 C.F.R. § 825.500. That regulation requires employers to keep and preserve records in accordance with the recordkeeping requirements of the Fair Labor Standards Act (FLSA). Records must be retained for no less than three years. Although no particular order or form is required, the records must be capable of being reviewed or copied.
Covered employers with eligible employees must also maintain records that include basic payroll and data identifying the employee’s compensation. Failure to maintain accurate records can have significant consequences for employers, who have the burden of establishing eligibility for leave. Accuracy is important: for example, the regulations demand that records document hours of leave taken in cases of leave in increments less than a full day. Lack of suitable records documenting when leave was taken can also doom an employer’s defense to claims for leave. Special rules apply to joint employment and to employees who are not covered by or are exempt from the FLSA.
Importantly, copies of employee notices of leave furnished to the employer under FMLA, if in writing, and copies of all general and specific written notices given to employees are required under FMLA regulations. The required copies may be maintained in employee personnel files. In the event of a dispute between the employer and an eligible employee regarding designation of leave as FMLA leave, employers must present the required records, including any written statement from the employer or employee regarding the reasons for the designation and for the disagreement. All too often employers fail to audit their own personnel files to confirm that the required documentation is in place.
Documents (defined to include written and electronic records) describing employee benefits or employer policies and practices regarding the taking of paid and unpaid leaves must also be maintained, along with records of premium payments, if any, of employee benefits.
Compounding The Recordkeeping Requirement: Don't Forget About Confidentiality
Of particular consequence for employers is the requirement that records and documents relating to medical certifications, recertifications or medical histories of employees or employees’ family members, created for purposes of FMLA, shall be maintained as confidential medical records separately from the usual personnel files. In those circumstances where the Americans with Disabilities Act (ADA) also applies, employers have a duty to maintain such records in conformity with the confidentiality requirements of the ADA.
Be Proactive, Audit Your Records
Well-intentioned employers recognize that it’s never too late to conduct a compliance audit to determine whether their organization is complying with FMLA requirements. Identifying and fixing any problems with your recordkeeping processes now could save a lot of headaches down the road.
Martha walks into your office and says she wants to fire her assistant, Roy, because he keeps sending emails with typos and it is embarrassing. Martha says, “We are at-will and I want him gone by the end of the day.” Like most others, Alaska is an “employment-at-will” state, which means that the employee and employer are free to end the employment relationship at any time and for almost any reason. But is there more to consider in terminating Roy?
Every employment relationship in Alaska contains an implied covenant of good faith and fair dealing. An employer can violate the covenant by acting with an improper motive, like firing an employee two weeks before he is tenured. The covenant also requires employers to treat employees in a way that a reasonable person would consider fair.
Violation of the covenant of good faith requires a very fact intensive inquiry, which often requires going through a trial with witnesses rather than resolving issues through a motion for summary judgment. Trial is incredibly expensive for employers, not only in court costs but also in terms of stress on staff and distraction from business. However, two Alaska Supreme Court cases issued in early July of this year, that you can see here and here, show that summary judgment is alive and well if an employer can adequately demonstrate it acted fairly and without improper motives in its termination process. The application of the implied covenant of good faith and fair dealing to the employment context varies from state to state, and clearly does not apply in some states, like Washington. Nonetheless these recent cases are a good reminder that fair and equitable treatment in discharging employees can help employers avoid costly and disruptive claims.
So what do we do about Roy? Here are five suggestions to help ensure compliance with the implied covenant of good faith and fair dealing:
- Follow a process. Require supervisors to provide good faith, fair reasons for discipline. Provide the employee an opportunity to respond to any allegations. Hear facts from Roy now, rather than for the first time in an EEOC proceeding or in court.
- Be fair. Enforce personnel policies in a way that a reasonable person would regard as fair. Follow personnel policies when disciplining employees. What policy is Roy violating? Is termination an appropriate response to Roy’s violations?
- Be consistent. Treat like employee alike, and justify any reasons for inconsistency in treatment. What type of conduct has resulted in other terminations? Have other employees received progressive discipline under similar circumstances, instead of termination? Treat Roy like other employees in similar situations.
- Act in good faith. Do not manufacture reasons to justify a termination. Is Martha frustrated with Roy for some other reason? Better to learn about it now.
- Document your process, fairness, consistency, and good faith.
Meghan M. Kelly also contributed to this post.
Employees who drive company vehicles between home and work will find little to cheer about in a recent Ninth Circuit decision . . . unless they live in California. In Rutti v. Lojack Corporation, a three-judge panel refused to relax the rule that commuting time is non-compensable under the Fair Labor Standards Act (FLSA).
The employee, who installed vehicle recovery systems, contended that his travel time between home and worksites was compensable under the FLSA and California law because his employer required him to drive company vehicles and significantly restricted his activities while doing so. For example, the employer prohibited the employee from transporting passengers and engaging in personal pursuits, and required him to drive directly to and from the worksite with his cell phone turned on.
All three judges rejected that argument under the FLSA, holding that use of an employer's vehicle to commute is non-compensable even if it is a condition of employment and that the restrictions placed on the employee's activities were incidental to his principal job activities. The unanimous panel also rejected the employee's argument that his commuting time was compensable under the "continuous workday doctrine," under which an employee's workday generally lasts until he has completed all of his principal activities during the day.
But the Rutti panel parted ways when it came to deciding the issue under California law. A two-judge majority found the tightly-controlled use of the company vehicle was compensable under California law requiring compensation for all time during which employees are "subject to the control of an employer." So the employee's claim under California law goes back to the trial court for further litigation.
The Rutti panel also issued a split decision as to whether certain activities of the employee at home before and after work was compensable off-the-clock work. The full panel rejected the employee's argument that his preliminary (i.e., before work) activities were compensable. Those activities consisted of such things as receiving, mapping and prioritizing jobs and routes assigned to him that day and occasionally filling out simple forms. The court found those activities were either incidental to the employee's principal job activities or so "de minimis" as to be non-compensable.
The court next considered the employee's postliminary activities. (The panel noted that "postliminary" is in the FLSA regulations but not in the dictionary.) Those activities included sending after-work transmissions of data from portable data terminals to the employers' computer system, a process that could be either quick or time consuming. Two of the judges held that the evidence was insufficient to conclude that the postliminary activities were either incidental or "de minimis" and therefore reversed the trial court's grant of summary judgment on that issue.