Human resources & employment law cumulative case briefs
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- Jurisdiction: Ninth Circuit
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Jurisdiction: Delaware Wal-Mart Stores, Inc. v. Indiana Electrical Workers Pension Trust Fund IBEW, No. 614 2013 (July 23, 2014);
Benefits practitioners and litigators need to closely monitor how well fiduciary responsibilities are being met. The Garner Rule is an exception to the general rule of attorney-client privilege, and the Delaware court cautioned that this fiduciary exception to the attorney-client privilege “is narrow, exacting, and intended to be very difficult to satisfy.” Read the article and case for the reasoning and the essential elements of proof. Essentially, a stockholder must show good cause in order to overcome a corporation’s attorney-client privilege in a case against a corporation allegedly acting contrary to the stockholders’ interests. Court summary: The Defendant Below/Appellant-Cross Appellee Wal-Mart Stores, Inc. (“Wal-Mart” or the “Company”) appeals from a final judgment of the Court of Chancery identifying specific steps Wal-Mart must take in searching for documents, and specific categories of documents Wal-Mart must produce, in response to a demand made by Plaintiff Below/Appellee-Cross Appellant Indiana Electrical Workers Pension Trust Fund IBEW ( “IBEW” or “Plaintiff”) pursuant to title 8, section 220 of the Delaware Code. The Court of Chancery conducted a Section 220 trial on the papers to determine whether Wal-Mart had produced all responsive documents in reply to IBEW’s demand. The Court of Chancery entered a Final Order and Judgment, which required Wal-Mart to produce a wide variety of additional documents, including ones whose content is privileged or protected by the work-product doctrine. Wal-Mart appeals the Court of Chancery’s Final Order with regard to its obligations to provide additional documents. IBEW filed a cross-appeal, arguing that the Court of Chancery erred in failing to require Wal-Mart to correct the deficiencies in its previous document productions and in granting in part Wal-Mart’s motion to strike its use of certain Whistleblower Documents. We conclude that all of the issues raised in this appeal and cross-appeal are without merit. Therefore, the judgment of the Court of Chancery must be affirmed. ERISA: defined contribution plan to defined benefit plan, optional form of benefit, pension transfer option – anti-cutback rule – no violation Jurisdiction: Ninth Circuit Anderson v. DHL Retirement Pension Plan, No. 12-36051 (9th Cir., 9/15/14):
The 9th Circuit found that eliminating the right to transfer an account balance from a defined contribution plan to a defined benefit plan does not violate the Act. The 1st Circuit Tasker case cited above previously ruled similarly, but for a different reason. Court staff summary: Affirming the district court’s dismissal of an action under the Employee Retirement Income Security Act, the panel held that defendants’ decision to eliminate plaintiffs’ right to transfer their account balances from a defined contribution plan to a defined benefit plan did not violate ERISA’s anti-cutback rule. The anti-cutback rule prohibits any amendment of an employee benefits plan that would reduce a participant’s “accrued benefit.” Plaintiffs were former employees of Airborne Express, Inc., who participated in both Airborne’s defined benefit pension plan and its defined contribution plan. The defined benefit pension plan was a floor-offset plan. That is, its benefits were calculated on the basis of a participant’s final average compensation and years of service, with an offset for any account balance in the defined contribution plan. Before the challenged amendment, participants could transfer the funds from their defined contribution plan accounts to the defined benefit plan’s general pool before the participant’s benefits were calculated. DHL acquired Airborne and merged the two companies’ retirement plans, amending the benefit plan to eliminate participants’ right to transfer funds into that plan. The panel agreed with the district court and the First Circuit that the amendment did not violate the anti-cutback rule, but it took a different path in reaching that conclusion. The panel deferred to the amicus brief of the government insofar as it interpreted Treasury Regulation A–2, which provides that, without violating the anti-cutback rule, a plan may be amended to eliminate provisions permitting the transfer of benefits between and among defined contribution plans and defined benefit plans. The panel also gave some weight to the government’s statutory interpretation. The panel held that the anti-cutback rule was not violated because the plan amendment did not reduce a participant’s accrued benefit in either the defined contribution plan or the defined benefit plan. The panel declined to decide whether the elimination of the transfer option was a “cutback” because the transfer option was an “optional form of benefit” under the anti-cutback rule. The panel concluded that if the transfer option were an optional form of benefit, then it would fall within the regulatory exception. Title VII: litigation, civil procedure – pro se party “named-party requirement” – franchisor, exhaust administrative remedies Jurisdiction: Fifth Circuit EEOC v. Simbaki, et al., 13-20387 (5th Cir., 9/17/14) [enhanced lexis.com version]:
Typically, employees complaining of discrimination must name all alleged discriminating individuals and entities so that the EEOC can review and screen the claim before it can proceed to the court system. This is known as exhausting administrative remedies. In some instances, pro se claimants may be excused from that requirement. Here, the complaining employees were represented by attorneys during the charging phase in the administrative agency. The trial court had ordered summary judgment, but the appellate court reversed that because the trial court needed to consider all of the various factors to determine if summary judgment would be appropriate under prevailing law. Appellate court summary: Kimberly Kulig and Laura Baatz appeal the district court’s dismissal of their Title VII lawsuit against Berryhill Hot Tamales Corporation for failure to exhaust administrative remedies. The district court based its exhaustion holding on a determination that only pro se parties may invoke the judicially-recognized exceptions to Title VII’s named-party requirement. Because we determine that parties represented by counsel may too invoke the exceptions to the named-party requirement, we VACATE and REMAND for further proceedings consistent with this opinion. Reasoning: * * * As our sister circuits have explained, the entire point of the judicially-recognized exceptions to the named-party requirement is to permit suits to go forward where, despite the plaintiff’s failure to name the defendant in the charges, the purposes of the named-party requirement have nonetheless been met. See, e.g., Eggleston, 657 F.2d at 905-06; Glus, 562 F.2d at 888. We do not perceive a reason why the presence of plaintiff’s counsel is necessarily determinative of that inquiry such that a categorical rule against represented parties invoking the exceptions is appropriate. Whether a party is represented by counsel, for example, tells us very little about whether the underlying purposes of Title VII’s named-party requirement—which largely concerns whether the allegedly discriminating party has received sufficient notice either through actual notice (Eggleston) or a proxy (Glus)—have been met. We therefore reject a per se rule that parties represented by counsel cannot invoke the judicially-recognized exceptions to the named-party requirement. Because the district court granted summary judgment on the grounds that Baatz and Kulig, as represented parties, could not rely on the exceptions to the named-party requirement, the district court did not determine whether Baatz and Kulig could fit within either the Glus or Eggleston exceptions. We accordingly VACATE the district court’s grant of summary judgment for Berryhill Corporate and REMAND for further proceedings consistent with this opinion, so that the district court can determine in the first instance whether a grant of summary judgment for Berryhill Corporate is appropriate. We express no view on whether summary judgment should be granted. Arbitration: work injury, award – reinstatement, appeal, consequences Jurisdiction: Illinois The Village of Posen, Illinois v. Illinois Fraternal Order of Police Labor Council, No. 1-13-3329 (8/11/14);
The law firm article describes the adverse consequences for the employer by appealing the arbitration award. Because of the great detail involved, reading the full opinion and the law firm article is recommended. Appellate court summary: Plaintiff, the Village of Posen (Village), appeals from an order of the circuit court that denied plaintiff's motion to vacate an arbitration award and confirmed the award entered in favor of defendant, the Illinois Fraternal Order of Police Labor Council (Union), which had represented Kevin Hammond in a grievance procedure after Hammond was terminated from the Village police department. On appeal, the Village contends the circuit court improperly struck allegations in its complaint that alleged that Hammond was not covered by the collective bargaining agreement and therefore the arbitrator did not have jurisdiction. The Village also challenges the underlying arbitration award, contending that: (1) the arbitrator improperly required that the Village prove the allegations by clear and convincing evidence, rather than by a preponderance of the evidence; (2) the arbitration award violates public policy; and (3) the arbitrator improperly required the Village to hold a pre-termination hearing. Lastly, the Village contends that if the award is upheld, the matter should be remanded to the arbitrator to determine a setoff. We affirm the judgment of the circuit court and decline to remand for a setoff. NLRB: successor employer liability, adverse employment action –failure to hire, established precedent overruled, union representation Jurisdiction: All Pressroom Cleaners Inc., 361 NLRB No. 57 (9/30/14) [enhanced lexis.com version]:
Successor liability is a legal theory concerning the nature and extent of the liability of a corporation for the legal obligations to the employees of the company it bought. The law flips back and forth. This current decision changed the liability, once again. The successor corporation failed to hire predecessor employees in an effort to avoid having to recognize their union representative and prior obligations. The decision ruled:
Decision introduction: The Board has considered the decision and the record in light of the exceptions and briefs, and has decided to affirm the judge’s rulings, findings,1 and conclusions2 and to adopt the recommended Order as modified below. The allegations in this case arise from the Respondent’s successful bid for a janitorial service contract previously held by Capitol Cleaning. We agree with the judge, for the reasons stated in his decision, that the Respondent violated Section 8(a)(3) and (1) of the Act by discriminatorily refusing to hire six Capitol Cleaning employees because of their union affiliation, that the Respondent is the statutory successor to Capitol Cleaning, and that the Respondent violated Section 8(a)(5) and (1) by unilaterally imposing new terms and conditions of employment on the employees it hired. We differ with the judge, however, on an important issue regarding application of the remedy. Applying Planned Building Services, 347 NLRB 670 (2006), the judge directed that the Respondent have the opportunity in compliance to limit its liability by showing that, even absent its unfair labor practices, it would not have agreed to the monetary provisions of the Union’s contract with Capitol Cleaning. The Charging Party excepts, arguing that this portion of Planned Building Services was wrongly decided and should be overruled. After careful consideration, we agree with the Charging Party. NLRB: Unfair labor practices (ULP)
Jurisdiction: All Purple Communications, Inc. and Communications Workers of America, AFL–CIO, 361 NLRB No. 43 (9/2414):
Board summary: At issue in this case are unfair labor practice allegations and election objections related to representation elections at two facilities of Respondent/Employer Purple Communications. On November 28, 2012, elections were held for the interpreters at seven of Purple’s call centers; the elections at Purple’s Corona and Long Beach, California facilities are at issue here. The General Counsel alleges that Purple violated Section 8(a)(1) by maintaining two overbroad work rules: a rule prohibiting employees from “[c]ausing, creating or participating in a disruption of any kind during working hours on Company property” and an electronic communications policy prohibiting employees from using Purple’s email system for any nonbusiness reason. The Union objects to the Corona and Long Beach election results based on Purple’s no-disruptions rule and electronic communications policy, as well as campaign speeches given by Purple’s president/chief executive officer. We address those issues here with one exception: consistent with our notice and invitation to file briefs issued on April 30, 2014, we sever and hold for further consideration the question whether Purple’s electronic communications policy was unlawful. ADA, FMLA: return to work release – policy, adverse employment action – termination, retaliation – no connection in time Jurisdiction: Eight Circuit Withers v. Johnson, No. 13-2646, (8th Cir., 8/15/14):
The employer’s written attendance and return-to-work policies [uniformly and consistently applied] took precedence over ADA and FMLA rights. The reason that words such as “written” and “uniformly and consistently applied” are important is because failure to do that often can result in a ruling that the policy was either meaningless or disparately impacted some employees. This case clearly states the import factors involved in valid termination of employment.
Employment Practices Liability Insurance (EPLI) is the correct one for claims such this one, not CGL. One practical question is whether the selling broker made this difference clear to the company. If so, rejecting EPLI coverage was the employer’s problem, if not, then the broker might be sued for that omission. Appellate court summary: A group of employees brought an action against their employer, Jon Davler, Inc., for various employment claims, including sexual harassment, invasion of privacy, and false imprisonment. Jon Davler tendered the action to its insurer, Arch Insurance Company, which denied coverage based on an employment-related practices exclusion. After Jon Davler filed this insurance coverage action against Arch, the trial court sustained Arch’s demurrer to the complaint without leave to amend. We affirm. Title VII: tribal hiring preferences, national origin – native preference – statutory exemptions – §25 U.S.C. §§ 396a, 396e, 42 U.S.C. § 2000e-2(i). 42 U.S.C. § 2000e–2(a) Jurisdiction: Ninth Circuit EEOC v. Peabody W. Coal Co., No. 12-17780 (9th Cir., 9/26/14):
Appellate staff summary: Title VII / Tribal Affairs The panel affirmed the district court’s summary judgment against the Equal Employment Opportunity Commission with respect to its claim that Title VII of the Civil Rights Act of 1964 prohibited the tribal hiring preference contained in Peabody Western Coal Co. leases with the Navajo Nation. The panel held that the Navajo hiring preference in the leases was a political classification, rather than a classification based on national origin, and therefore did not violate Title VII. The panel concluded that the district court correctly granted summary judgment to defendants Peabody Western Coal Company and Navajo Nation, and third-party defendant Secretary of the Interior. The panel also held that the EEOC waived on appeal its record-keeping claim. Finally, the panel held that the district court acted within its discretion in denying the EEOC’s eleventh-hour motion to supplement the record with a declaration and documents about Peabody’s hiring practices in 1999. Medical Marijuana: reimbursement, NM Workers’ Compensation Act (the Act) – NMSA 1978, §§ 52-1-1 to -70, Lynn and Erin Compassionate Use Act (Compassionate Use Act) – NMSA 1978, §§ 26-2B-1 to -7 Jurisdiction: New Mexico Vialpando v. Ben’s Automotive Services, et al., No. 34,766 (NMCA, 5/19/14, 7/25/14, Certiorari Denied); 2014-NMCA-084, http://www.nmcompcomm.us/nmcases/NMCA/2014/14ca-084.pdf [enhanced lexis.com version]. Workers’ compensation cases seldom are noted here because that is very specialized area of expertise outside of typical human resources and employment jurisdiction (typically the insurance contract gives complete control to the insurer rather than the employer). However, medical marijuana issues affect human resources and employment law considerations. This case is included because the New Mexico Supreme Court declined to consider it. The conflict between federal and state drug laws creates problems almost impossible to solve. Perhaps this Vialpando case might provide some insight for practitioners about how New Mexico possibly would deal with other related issues arising in the future. Appellate court summary: {1] We consider in this appeal whether, under the Workers’ Compensation Act (the Act), NMSA 1978, §§ 52-1-1 to -70 (1929, as amended through 2013), an employer and insurer must reimburse an injured worker for medical marijuana used pursuant to the Lynn and Erin Compassionate Use Act (Compassionate Use Act), NMSA 1978, §§ 26-2B-1 to -7 (2007). The workers’ compensation judge (WCJ) found that Worker Gregory Vialpando was qualified to participate in the State of New Mexico Department of Health Medical Cannabis Program authorized by the Compassionate Use Act and that such treatment would be reasonable and necessary medical care. The WCJ ordered Worker to pay for medical marijuana through the program and Employer and Insurer Ben’s Automotive Services and Redwood Fire & Casualty (collectively, Employer) to reimburse Worker. Employer appeals, arguing that (1) the WCJ erred because his order is illegal and unenforceable under federal law and also thereby contrary to public policy, and (2) the Act and regulations promulgated pursuant thereto do not recognize reimbursement for medical marijuana. Because we agree with the WCJ that the Act authorizes reimbursement for medical marijuana, we affirm. [Also, follow this Colorado case discussed in the Constangy, Brooks & Smith law firm article at http://www.employmentandlaborinsider.com/drug-testing-2/colorado-supreme-court-hears-arguments-in-medical-marijuanadischarge-case/. Adverse Employment Action: statutory and common law theories
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