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As colleges and universities begin new terms, not all students are returning to the classroom.  Some students are headed into the “real world,” to work alongside corporate titans, small-business owners, or moms and pops in their shops, while receiving academic credit—and not wages—for their efforts.  These students are applying the lessons learned in their prior studies to real-world scenarios to gain valuable experience, build their skills, and make connections to help them succeed upon graduating.  Or at least they should be.  If they are instead used merely as a source of labor, they must be paid.  But many employers mistakenly assume that because these students are getting school credit, they need not be paid.  That is a trap into which employers reading this blog will not fall.

The Fair Labor Standards Act (“FLSA”) and state laws require employers to pay all employees for work performed.  If students who participate in unpaid internships with private employers do not qualify as “employees,” they need not be paid.  Whether those students qualify as “employees” depends on several factors, but the general rule is that these programs are lawful as long as the student, not the employer, is the primary beneficiary of the internship program.Continue Reading It’s a Trap!  Students Receiving Credit Need Not Be Paid? 

A number of recent legal changes will have a notable impact on employee benefits law both now and in the future.  Some of the most significant of those changes are the U.S. Supreme Court’s same-sex marriage decision in Obergefell v. Hodges, and the expansion of Title VII’s discrimination protections to lesbian, gay, bisexual, and transgender (“LGBT”) individuals by the Equal Employment Opportunity Commission (“EEOC”) and some federal courts.

Same-Sex Marriage:  Windsor and Obergefell v. Hodges

In the 2013 Windsor decision, the U.S. Supreme Court ruled that the federal government must recognize same-sex marriages for purposes of federal law.  After Windsor, the federal government issued guidance that it would look to the law of the state where the same-sex couple was married (state of celebration), rather than to the state law where the couple lived (state of residence), in most instances under federal law to determine if the same-sex couple was validly married.  On June 26, 2015, the U.S. Supreme Court held, in a 5-4 decision in Obergefell v. Hodges, that state laws banning same-sex marriage are unconstitutional, and mandated that states both permit same-sex couples to marry and recognize same-sex marriages lawfully performed in other states.  As a result of Obergefell, the “state of celebration” test for determining whether to recognize a same-sex couple’s marriage is no longer relevant under federal law.
Continue Reading Developments in Employee Benefits Law: Same-Sex Marriage and Title VII’s Protection for LGBT Employees

The Ninth Circuit released a precedent-setting Americans with Disabilities Act (“ADA”) decision yesterday, and it’s a big win for employers.  The Court held that an employee who makes “serious and credible threats of violence toward his co-workers” is not a “qualified individual with a disability” and therefore cannot state a claim under the ADA or Oregon disability law. Karen O’Connor, Brenda Baumgart and Andrea Thompson from Stoel Rives represented the employer in this case, Mayo v. PCC Structurals, Inc., and a link to the Court’s decision is here.

Plaintiff’s Stress Leads to Death Threats in the Workplace

Plaintiff was a long-term welder at an industrial facility. Despite a 1999 diagnosis of major depressive disorder, he worked without significant issue for decades. In 2010, plaintiff and a few co-workers claimed a supervisor bullied them at work. Shortly after a meeting among plaintiff, a co-worker and the company’s HR director to discuss the supervisor, plaintiff began making threatening comments. He told a co-worker that he “felt like coming down to [the facility] with a shotgun and blowing off” the heads of his supervisor and a different manager. Among other comments, he also told other co-workers that he planned to come to the facility during the day shift “to take out management” and that he “wanted to bring a gun down to [the facility] and start shooting people.”Continue Reading The Ninth Circuit Joins Its Sister Circuits in Ruling That an Employee Who Threatens Co-Workers with Violence Is Not “Qualified” Under the ADA

In a 3-2 decision published on Thursday, July 16, 2015, the U.S. Equal Employment Opportunity Commission (“EEOC”) concluded that intentional discrimination against an employee based on their sexual orientation is sex discrimination- an act strictly prohibited under Title VII of the Civil Rights Act of 1964. “Discrimination on the basis of sexual orientation is premised…

It’s been an active legislative session in Oregon this year regarding laws affecting the state’s employers.  Hot on the heels of enacting laws relating to paid sick leave, noncompete agreements, and employee privacy on social media, Governor Kate Brown also recently signed into law House Bill 3025.  That law will make …

Stoel Rives Summer Associate Dexter Pearce co-authored this post.

In a case Justice Antonin Scalia described as “really easy,” the Supreme Court held that an employer can be liable for failing to accommodate a religious practice even if the employer lacks actual knowledge of a need for an accommodation. Writing for the 8-to-1 majority (Justice Thomas dissented), Scalia stressed that Title VII is concerned with motive, not knowledge. Thus, even if an employer has no more than an “unsubstantiated suspicion” of an applicant’s religious beliefs/practices, the employer violates Title VII if it’s action is motivated by a desire to avoid a potential accommodation.

Abercrombie employs a “Look Policy” that prohibits “caps.” Samantha Elauf, a practicing Muslim, applied for a retail sales position. Elauf wore a headscarf to her interview, but neither the headscarf nor religion were discussed. Heather Cooke, the assistant store manager and interviewer, identified Elauf as qualified for the position, but asked her store manager and the district manager about Elauf’s headscarf, noting that she believed Elauf wore her headscarf because of her faith. The district manager told Cooke that the headscarf would violate the Look Policy and instructed her not to hire Elauf.Continue Reading U.S. Supreme Court’s Decision in EEOC v. Abercrombie & Fitch: It’s All About the Motive

The U.S. Supreme Court handed a defeat to United Parcel Service (UPS) this week. At issue was whether UPS violated the Pregnancy Discrimination Act (PDA) by requiring a pregnant woman with lifting restrictions to go on leave during her pregnancy, while workers in certain other categories (such as those with on-the-job injuries) were allowed light duty. We consider the ruling and the lessons it holds for employer leave and accommodation policies below.

In a decision announced March 25, 2015, the Supreme Court ruled that the district court, which had dismissed Young v. UPS (PDF) on summary judgment, must proceed to trial on the question of whether intentional discrimination occurred when a pregnant UPS employee was treated less favorably than others in similar situations.

The Court ruled in Young that under the PDA an employee can make a prima facie case of discrimination by showing that she was denied accommodation, while other sick or disabled workers with a similar inability to work were allowed accommodation. The employer then must show that it had a legitimate non-discriminatory reason for the difference in treatment to avoid liability, and if it makes such a showing the plaintiff can rebut the showing through evidence of pretext.
Continue Reading Supreme Court Sends UPS Pregnancy Accommodation Case to Trial

The U.S. Supreme Court, in a rare unanimous decision earlier this week in Integrity Staffing Solutions v. Busk, held that time spent by warehouse employees at Amazon.com warehouses waiting to go through security checks at the end of their shifts was “postliminary” activity not compensable under the federal Fair Labor Standards Act (“FLSA”) and its major amendment, the Portal to Portal Act (“PPA”).  While Busk may provide welcome clarity for employers who wish to implement such screens, the case probably does little to radically change the analysis of compensability of other pre- and post-shift activities beyond its narrow set of facts.

Amazon.com’s Warehouse Security Checks

Integrity Staffing is a staffing agency that provides employees to Amazon.com.  Those employees work in the company’s warehouses pulling products from shelves and getting them packaged for mailing to buyers.  Because of concerns related to employee theft, Integrity Staffing required employees to go through security checks before leaving the warehouse at the end of their shift, but did not pay employees for that waiting time.  Waiting in line and going through these security checks took about 25 minutes.Continue Reading U.S. Supreme Court Finds Post-Shift Security Checks Noncompensable in Integrity Staffing v. Busk, But Employers Shouldn’t Get Too Excited

pharmacistEmployers like separation agreements.  Separation agreements, of course, are contracts that employees sign when their employment is terminated that allows them to be paid severance and in exchange they usually give up the right to sue their employer.  Separation agreements provide finality to employment terminations by offering employers protection from claims and potential claims.  The agreements many employers use are often standardized and have served them well for years.  But now might be the time to take another look at those documents, lest the Equal Employment Opportunity Commission (“EEOC”) looks first.

Recently, the EEOC has aggressively asserted its (re)interpretation of the law regarding the enforceability of separation (severance) agreements, suing several companies for using what it perceived to be overly broad agreements.  See, EEOC v. CVS Pharmacy, Inc. no. 1:14-cv-00863 (N.D. Ill. 2014); see also, EEOC v. CollegeAmerica Denver, Inc., no. 14-cv-01232-LTB (E.D. Co. 2014).  The EEOC doesn’t like separation agreements that do not make it sufficiently clear (in the EEOC’s opinion) that employees do not waive the right to file charges with the EEOC or participate in agency investigations, even though the employee can waive claims for damages under the statutes the EEOC enforces like Title VII or the Americans with Disabilities Act (“ADA”).  In the CVS Pharmacy and CollegeAmerica cases, the EEOC alleged the employers’ separation agreement forms constituted a “pattern or practice” of denying employees their statutory rights.  (“Pattern or practice” is significant because such cases can carry much higher penalties than a run-of-the-mill lawsuit; they can also inspire class-action lawyers to start snooping around.)Continue Reading EEOC’s Tough Stance on Employee Separation Agreements