Today’s Consenting Relationship Might Be Tomorrow’s Sexual Harassment Suit…

Yes, I admit I ripped off this “consenting” phrase from sexual harassment prevention training I recently went to, but I couldn’t agree with the point more.   Just last week another high-profile sexual harassment case arose from the same set of facts. The article summarizing the case stated: “…Kenya Burks, who was employed as the Chief of Staff with the city of Vicksburg, initially had a consensual sexual relationship with Mayor Paul Winfield. Ms. Burks alleges in her complaint that during her employment that she attempted to end the consensual sexual relationship with Mayor Winfield after he became physically abusive; however, Mayor Winfield continued his sexual advances toward Ms. Winfield even though she had informed him that they were unwanted on numerous occasions. Finally, the complaint alleges that Mayor Winfield terminated Ms. Burks and threatened frivolous criminal charges against her in retaliation for her refusing to continue the sexual relationship with Mayor Winfield.”

This story is so commonplace that I’m sure it must be the number one way that sexual harassment lawsuits come to pass. So beware: today’s consensual, innocuous workplace romance can become tomorrow’s workplace headache. How can you protect yourself? Have a no dating policy in place and, if employees insist on dating, have them sign a dating waiver that outlines the risk they are taking, waives liability for the company, and articulates ways in which consensual relationships can become non-consensual. This is particularly important for supervisor-supervisee relationships. A sample waiver might say this:

As of Effective Date, Employee A and Employee B acknowledge again that they have a voluntary dating relationship and that they are equal co-workers. They acknowledge that they entered into this relationship voluntarily, with out duress, and are engaging in the relationship purely for personal reasons.

B. Neither Employee has requested or expects work-related favoritism from the other or from Company as a result of this dating relationship.

C. As of the Effective Date, Employee A and Employee B are not aware of any conflicts related to their dating  relationship; however, acknowledge the potential for conflicts to arise.

D. As of the Effective Date, Employee A and Employee B are not aware of any conduct that they would consider to be wrongful on the part of the Company, its employees, or other affiliated entities and waive any claim potentially related to same.

E. Should Employee A or Employee B consider the other’s conduct to be sexually harassing at any time, they will immediately inform ___of this.

F. Any such continued employment does not limit Company’s rights to terminate the at-will employment of either Employee A or Employee B, to request that one or both of the employees leave their current position and interview for a new position at Company (with no conflicts of interest), or to leave Company altogether.

Keep in mind that such a waiver will not erase company’s liability, but it will go a long way toward bringing potential problems out into the open before they become lawsuits.

The San Francisco Sick Leave Ordinance

Recently it has come to my attention that many of my clients are not following the San Francisco Sick Leave Ordinance, and are thereby exposing themselves to potential lawsuits. The ordinance, which became effective on February 5, 2007, requires employers of all sizes to provide employees who work in San Francisco with one hour of paid sick leave for each 30 they work. Again, this is for all employees who work in San Francisco (more than 56 hours a year) regardless of where the employer is based! There is a cap of 40 hours of paid sick leave for employers who have less than 10 employees, and a cap of 72 hours for those who have more than 10 employees. However, this cap only applies until the employee uses it up. Then the employee can begin to accrue again. There is no annual cap for how much sick leave an employee can accrue or take.

In addition, the ordinance requires employers to post it (clicking here will bring you to a printable poster) where it can easily be seen, to keep track of employees hours for the purposes of according paid sick leave, and to keep a record of these hours for four years in case of audit by the Office of Labor Standards Enforcement (OLSE). I would also recommend including something about it in your employee handbook. I’ve enclosed a sample policy I recently drafted below. It’s a very bare bones one that can be added to as your company sees fit. Please feel free to post comments or questions about it on the blog.

A great Q&A produced by OLSE the can be found by clicking here.  Of course you can always email me, Diana@dianamaierlaw.com, or call me with questions too.

Sick Leave Insert for Employee Handbooks

Sick leave is a form of insurance that employees accumulate in order to provide a cushion for incapacitation due to illness. It is intended to be used only when actually required to recover from illness or injury; sick leave is not for “personal” absences. Sick leave can be used when an employee is ill, injured, or receiving medical care, treatment, or diagnosis, or when attending to a family member or designated person who is ill, injured, or receiving medical care, treatment, or diagnosis.

The company offers paid sick leave to employees pursuant to the San Francisco Paid Sick Leave Ordinance. This ordinance is posted on the Company’s premises at ___. Employees accrue paid sick leave at the rate of one hour for each 30 worked. After an employee accrues 40 hours of sick leave, she is ineligible to accrue more paid sick leave until she has used some or all of her accrued paid sick leave (note that this cap changes with larger employers). There is no cap on how much sick leave an employee may accrue or use in a year.

The Company does not pay employees in lieu of unused sick leave.

MORE ON INVESTIGATIONS…

Potential workplace investigation clients have been asking me a lot of questions lately about who should conduct an investigation, and how, in order to garner the maximum legal protection such investigations may provide.  In short, to get the most bang for your buck, it’s important to hire someone licensed to conduct investigations (generally a private investigator or attorney, see Business and Professions Code Section 7520 et seq),  and to follow the dictates of Cotran v. Rollins Hudig Hall Internat., Inc. (1998) 17 Cal. 4th 93.  In Cotran, the California Supreme Court explained that the reasonableness of the employer’s investigation into an employee’s claim of harassment, not whether the harassment actually occurred, determined whether the employer could be liable for wrongful termination of an accused harasser.

Reasonableness was essentially determined by determining whether the investigation contained a few key ingredients.  They included: promptness of a company’s response to the allegations, the hiring of an impartial investigator who is trained in the skills required for interviewing witnesses and assessing credibility, whether allegations were kept confidential during the investigation (so as not to contaminate the reliability of information the investigator gathers); how thorough the investigation was, and whether the investigator made credibility determinations that ultimately allowed management to decide whether something actionable occurred.  California Employment Lawyers Association (CELA) member Michael Robbins wrote an excellent article on this topic.

The same year as the Cotran decision, the California Court of Appeal in Silva v. Lucky Stores, Inc. (1998) 76 Cal.Rptr.2d382 affirmed the elements of a reasonable investigation outlined in Cotran. The Silva court held that the reasonableness of an employer’s investigation depended on whether the investigation was timely, conducted by a competent investigator, and was reasonable under the circumstances.

For more questions on this topic, please free to contact me. diana@dianamaierlaw.com

Why Hiring the Right Workplace Investigator is So Important

I just got back from a three-day conference of the Association of Workplace Investigators (AWI).  AWI is going to change the way workplace investigations are done, and I suspect all for the better.  Finally there is a place where investigators can compare notes and develop methodologies that support investigative health.  That is, workplace investigators can use AWI as a touch point to ensure their investigations are litigation ready in case their investigations are challenged in court.

But employer-clients must do their part too.  Recently I was hired to defend a company facing a charge of sexual harassment.  When I reviewed the investigation that had been conducted, I was dismayed to see that the investigator had not interviewed the complaining witness.  Apparently the complaining witness had declined to be interviewed at the outset and the investigator gave up without making any additional calls or efforts to reach the witness.  She also failed to advise the client how severely this omission would limit her findings. An experienced investigator who is properly trained knows how difficult it is to come to any conclusion about a complaint without speaking to the person who started the ball rolling in the first place.  I have had many complaining witnesses refuse to speak with me at first.  However all of them have eventually agreed to let me interview them when I persistently explained the importance of their role or offered some concession that would make them comfortable.  Frankly I felt that I really couldn’t do my job without the complaining witness’ statement, and it was perfectly appropriate to be flexible (as well as tenacious) in pursuing a solution with them.  As I said, in all cases the complaining witness has eventually come around.   A good investigator should not give up on getting this interview until she has tried everything possible to make it happen.

The sex harassment litigation I described above could have been prevented with a proper investigation.  The client told me they hired this investigator because she was inexpensive, but the company ended up being penny-wise, pound foolish when it had to pay on the litigation.  I urge employers everywhere to find an investigator who is either a certified private investigator or an attorney, as the California Business and Professions Code Section 7520 et seq requires, and ultimately someone who understands what’s at stake in workplace investigations.  Please always feel free to email or call me to either ascertain my availability, or to get a reference for other investigators who can perform an investigation that will protect the employer’s interests.  Also, if this is an area that’s unfamiliar to you, read my blog on the topic to understand why investigations are so important: http://dianamaierlaw.com/blog/2011/03/17/another-important-reason-to-conduct-investigations/ and http://dianamaierlaw.com/blog/2011/03/10/investigations-and-the-appearance-of-neutrality/ are good places to start.

Can You Prohibit Personal Computer Use at Work?

A question that repeatedly arises from my clients is whether it’s OK to limit employees’ personal use of computers, particularly their access to certain websites and their use of personal email.

It is absolutely legal, and definitely a good idea, to prohibit employees’ personal use of workplace computers. It’s also legal to block employee’s access to certain websites. However, the key thing is to be sure to have a written policy outlining what isn’t allowed in the workplace and have all employees read and sign this policy. In that way, employers diminish the employee’s expectation of privacy in their electronic workplace and protect themselves legally.

A recent California case outlined some key elements to include in such a policy:

[E]mployers can diminish an individual employee’s expectation of privacy by clearly stating in the policy that electronic communications are to be used solely for company business, and that the company reserves the right to monitor or access all employee Internet or e-mail usage. The policy should further emphasize that the company will keep copies of Internet or e-mail passwords, and that the existence of such passwords is not an assurance of the confidentiality of the communications. An electronic communications policy should include a statement prohibiting the transmission of any discriminatory, offensive or unprofessional messages. Employers should also inform employees that access to any Internet sites that are discriminatory or offensive is not allowed, and no employee should be permitted to post personal opinions on the Internet using the company’s access, particularly if the opinion is of a political or discriminatory nature.” (Fernandez, Workplace Claims: Guiding Employers and Employees Safely In And Out of the Revolving Door (1999) 614 Practicing Law Institute, Litigation and Administrative Practice Course Handbook Series, Litigation 725; see also Gantt, An Affront to Human Dignity: Electronic Mail Monitoring in the Private Sector Workplace (Spring 1995) 8 Harv. J.L. & Tech. 345, 404-405. (TBG Ins. Services Corp. v. Superior Court (Zieminski) (2002) 96 Cal. App. 4th 443, 451-452.)

I think TBG offers good advice regarding its policy suggestions and I’d also add to your policy anything else relating to personal computer use. Err on the side of being over inclusive. Don’t forget to get that employee signature when you’re through!

More on AT&T Mobility v. Concepcion: Will Employment Class-Action Suits Disappear in California?

By Diana Maier and Debra B. Burns

California’s employment-law community is scratching its corporate head over what the recent U.S. Supreme Court’s 5-4 split decision in AT&T Mobility v. Concepcion means for class actions in California. (Apr. 27, 2011) 563 U.S.. Is it the death of employment class actions? Or will it be limited to consumer cases only? Has federal law effectively taken over the state’s arbitration and class-action laws? Or will California courts find a way to limit Concepcion’s preemptive effect in employment-related cases?

Federal Arbitration Act Preempts California State Contract Law.

In the 5-4 split decision of AT&T Mobility v. Concepcion, the U.S. Supreme Court held that the Federal Arbitration Act (“FAA”) preempted California contract law. (Apr. 27, 2011, p. 18 of the slip opinion). Lower courts had applied state laws to invalidate arbitration agreements that did not permit class arbitration. Id. at 2. Although the Concepcion decision involved a consumer contract and not an employee contract, the Court’s reasoning might be extended to cases where employers seek to enforce employment agreements that prohibit workplace class actions and require the individual arbitration of employment-related claims.

The facts of the Concepcion case are straightforward. AT&T advertised that a free cell phone would be given to customers who signed up for new service. Id. at 2. To sign up, new customers agreed to submit any disputes to binding arbitration and to waive the right to file a class-action suit. Id. AT&T gave these customers a free phone but charged them sales tax. Id. Mr. Concepcion as lead plaintiff filed a class action against AT&T for false advertising and fraud. Id. at 3. AT&T moved to compel arbitration, the federal district court denied the motion, and the Ninth Circuit Court of Appeals affirmed, relying on Discover Bank v. Superior Court.  AT&T Mobility v. Concepcion at 3. Discover Bank v. Superior Court (2005) 36 Cal. 4th 148.

California Supreme Court held in Discover Bank that class action waivers in consumer arbitration agreements are unconscionable and therefore unenforceable.  AT&T Mobility v. Concepcion at 3. The United States Supreme Court disagreed and found that the FAA preempted California state contract law because the law “stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.”

But Does AT&T Mobility v. Concepcion Relate to Employment Arbitration?

Although Concepcion concerns consumer arbitration and employee arbitration cases, it still may have a major impact on employee arbitration law in California. For example, Concepcion overturns Discover Bank’s holding, which the California Supreme Court had extended in Gentry v. Superior Court, to waivers in employee arbitration agreement, finding them unenforceable. Gentry v. Superior Court (2007) 42 Cal. 4th 44; 64 Cal. Rptr. 3d 773, 789-90. State courts might decide that they can no longer invalidate class-action waivers in arbitration contracts because the FAA preempts state contract laws.

ConcepcAion also puts California Supreme Court’s 4-3 decision in Sonic-Calabasas v. Moreno into question. (2011) 51 Cal. 4th 659. Decided two months before Concepcion, the court held under section 2 of the FAA (9 U.S.C. §2) that California courts may refuse to enforce an arbitration agreement based on generally applicable contract defenses, such as unconscionability. Id. at 686. The court did say, however, that a court might not apply these defenses in a manner that discriminates against arbitration. Id. at 686.

So are Waivers of Class Actions in Arbitration Contracts Valid?

Possibly, although it is unclear to what extend courts might apply the holding of Concepcion to employment contracts. If the reasoning of Concepcion extends to the arbitration of employment claims, it would seem to overrule a vast body of well-settled California law. In their reluctance to enforce employment arbitration agreements, California courts have long relied on public-policy grounds. The Fourth Circuit recently dodged the validity question of class action waivers in employee arbitration clauses under the FAA. Brown v. Ralphs Grocery Company (July 12, 2011) 195 Cal. App. 4th. Thus, we may need to wait for a dispute over a class-action waiver clause in an employment arbitration contract to work its way up to the California Supreme Court. Perhaps then the court will provide more guidance on the validity of class-action waivers.

AB 240: Making a Claim for Unpaid Wages for Minimum Wage Earners

On September 7 Governor Jerry Brown signed into law a new bill that seeks to ensure that minimum wage workers who have been victims of wage violations receive the same relief, whether they pursue their claims administratively or through the courts. Assemblywoman Susan A. Bonilla (D-Concord), authored and introduced the bill, AB 240.

AB 240 provides that an employee alleging a minimum wage violation may recover liquidated damages equal to the amount of wages improperly withheld plus interest in proceedings before the Labor Commissioner.

California labor law offers employees two alternatives when making a claim for unpaid wages: an employee may file a claim in superior court or may file a claim with the Labor Commissioner’s office. While—in the past—employees could pursue wage violation complaints through either litigation or an administrative process, they could obtain liquidated damages only through complaints decided in litigation. Workers seeking relief through the administrative process could not receive liquidated damages. AB 240 thus makes significant changes to the law