Employment Law Update – Summer 2007

    By Labor & Employment

    Employers Should Prepare for Minimum Wage Increase

    Although a perennial popular stumping topic among politicians, an increase in the federal minimum wage has not had serious potential to become reality for about a decade. This state of affairs changed on May 25, 2007 when the President signed into law a bill that will raise the minimum wage gradually over the next two years.

    Buried deep in this bill, titled U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007, is a Fair Minimum Wage and Tax Relief provision that raises the federal minimum wage by $2.10. Under the law’s current terms, the minimum wage will increase from $5.15 to $5.85 an hour beginning sixty days after the law’s enactment. Twelve months after this raise, the rate will go to $6.55 an hour; twelve months later, the rate will rise to $7.25 an hour.

    Even employers who do not anticipate a direct impact from this law on their current wages may see pressure to increase wages for hourly employees generally. Such employers also may see increased overtime expense. Media attention associated with the increase in minimum wage may increase attention on wage-hour policies and practices generally, so employers are well advised to audit their wage-hour practices in preparation for this expected change.

    Given the recent proliferation of wage-hour claims being filed against employers, the expected minimum wage increase should only increase this trend. Many lawyers who sue employers already include wage-hour claims at the top of the list of claims they like to file, so employers are well-advised to proactively protect against this increasing risk.

    Practical Pointer

    The K&C Employment Team continues to help employers audit their pay practices to ensure that their employees are being paid properly. As part of this effort, a wage-hour workshop will be presented at the July 19th showing of the 23rd Annual Employment Law Update at the Hampton Roads Convention Center. To help provide direction and answer any questions employers may have, the former District Director of the Wage-Hour Division of the Department of Labor and a current Supervisor of the Virginia Department of Labor and Industry will participate in the program. Additionally, a how-to workshop on performing self-audits will be presented to help employers interested in avoiding risk in all of their employment practices, including how employees are paid.

    Experts Predict More USERRA Claims

    The Uniformed Services Employment and Reemployment Rights Act (USERRA) extends broad employment protection to military service members in civilian employment. At a recent national conference on Equal Employment Opportunity law, a Justice Department lawyer told the American Bar Association lawyers present that they should expect more claims under this law.

    Among other things, USERRA prohibits employers from discriminating against an individual due to military service, bans the denial of a benefit of employment because of such service, and gives returning service members a strong right to reemployment. Esther Tamburo, an attorney with the Justice Department’s Civil Rights Division, said litigation under USERRA has become most active since the U.S. war in Iraq began and that recent federal court decisions are clarifying the statute’s scope. The anticipated increase should be greater in areas like Hampton Roads given the high number of residents in the military.

    The strength of USERRA protection for individuals returning from military service was emphasized during the conference. For example, attendees were reminded that USERRA has extremely broad protection for injured service members returning to their civilian jobs and that employers have an obligation to help qualify the service member for the job as well as provide reasonable accommodation. USERRA protections in this regard may actually be stronger than protections for the disabled under the Americans with Disabilities Act (ADA).

    While the number of USERRA claims is predicted to increase and most cases emphasize how strong such claims are, at least one recent case, Francis v. Booz, Allen & Hamilton, illustrates that USERRA protections are not without limitations. In that case, a female employee returning from military service was employed, but she alleged discrimination because her job duties were diminished. She later was fired for alleged performance problems. The Fourth Circuit Court of Appeals found that a slight change in job duties, which did not affect the individual’s pay or benefits, was not unlawful discrimination under USERRA and that discharge for poor performance after the individual was rehired was appropriate under the circumstances of that case.

    Top 10 Outrageous Employment Law Cases – The Results Are In

    Attendees of the Richmond showing of the 23rd Annual Employment Law Update cast their ballots and voted on the Top 10 Outrageous Employment Law Cases for 2006. The winners will be announced at the July 19th Employment Law Update in Hampton, Virginia.

    One of the finalists included a case we call Physical Therapy, where a California nurse claimed that an 84-year old patient pestered her for sex. Although the hospital where she was employed took steps to stop the harassment, the elderly patient, who was recovering from penile implant surgery, continued to badger her and tried to run her down with his electric scooter when his advances were not successful.

    The California Supreme Court affirmed the jury’s award of $180,000 plus $380,000 in attorney’s fees and court costs. Will the miracles of modern medicine ever cease?

    Employers Benefit from Developing Legal Defenses to Harassment Claims

    In the past ten years, several important cases have worked together to reshape the litigation landscape for employers charged with harassment. These cases lay out simple strategies that discourage workplace harassment and provide strong defenses to those employers who use them. The trend began with the 1998 Supreme Court cases of Burlington Industries v. Ellerth and Faragher v. City of Boca Raton. These cases gave employers an affirmative defense to harassment claims where the complaining employee failed to take advantage of an anti-harassment policy. Cases since Ellerth and Faragher have provided the specifics for this affirmative defense by requiring that the policy be clearly communicated to employees and that it contain meaningful reporting and investigating components.

    What do these cases mean for employers? First, share your well-drafted anti-harassment policy with employees through the use of posters, handbooks, and similar media. Don’t let the policy gather dust – not only should supervisors be trained on the policy, they should be alert for violations of it. Second, provide employees with a clear idea of who to contact with reports of harassment. Give employees a choice of more than one contact in case the alleged harasser is one of the contacts. Third, investigate any complaints thoroughly and promptly, and keep the investigation as confidential as possible. Maintain records of the investigation in a file other than the personnel files of the complaining or accused parties. Fourth, advise the complaining employee of the results of your investigation.

    Even if the investigation results in a finding that the anti-harassment policy has not been violated, remind the employee of the importance of his/her complaint and the company’s commitment to maintaining a workplace free of harassment. Good communication may help avoid further frustration for the employee. Finally, throughout the investigation of any claim of harassment, do not tolerate any retaliation against a complaining employee. Not only are claims of retaliation scrutinized by the Equal Employment Opportunity Commission, but a hasty retaliatory act may result in a legitimate claim of retaliation even where the underlying allegations of harassment are unfounded.

    In sum, your enforcement of a meaningful anti-harassment policy remains one of your best defenses to any claim – and be watchful for the potential of retaliatory acts which may undermine this strong defense.

    Too Many Absences Not OK Under the ADA, Even if Protected by the FMLA

    The Family and Medical Leave Act (FMLA) provides up to 12 weeks of unpaid leave per FMLA year to covered employees with a qualifying health condition. An employee is covered if his or her company employs 50 or more people in locations within a 75-mile radius. The Americans with Disabilities Act (ADA), on the other hand, requires employers with 15 or more employees to make reasonable accommodations for those with disabilities who can otherwise perform the essential functions of a job. What is an employer to do where an employee’s absences under the FMLA prevent that employee from fulfilling the essential functions of his job for purposes of the ADA?

    A recent Federal case concluded that even FMLA-approved absences may justify discharging an employee under the ADA. In Payne v. Fairfax County, plaintiff Stuart Payne was regularly absent without notice due to various illnesses. After exhausting his FMLA leave, Payne requested that his conditions be accommodated under the ADA. Because Payne was so regularly absent, Fairfax County concluded that he could not perform the essential function of attendance and therefore was not a qualified individual with a disability under the ADA. Payne sued, alleging that his FMLA absences could not be used against him in the ADA essential function analysis.

    The Federal District Court sided with Fairfax County. Although the FMLA protects an employee from discrimination for exercising FMLA rights, the Court concluded that the FMLA was not meant to modify the terms of the ADA. The two statutes, although sometimes available to the same employee, do not operate together to force an employer to provide an ADA accommodation to an employee who is regularly and unpredictably absent.

    23rd Annual Employment Law Update: A Flight Plan for Risk Avoidance

    On July 19th, the K&C Employment Law Team will host the final showing of the 23rd Annual Employment Law Update: A Flight Plan for Risk Avoidance, at the Hampton Roads Convention Center. This year’s program is designed to provide employers with the travel guidelines for navigating the employment law maze.

    Seminar highlights include a lunch presentation by an attorney who specializes in suing employers, several employment agency representatives, and an ice cream social to wrap up the day! Topics will include Discipline & Discharge, Personnel File Access, Interviewing & Hiring, Conducting an Effective Employment Seld-Audit, and more.

    Avoid standby status and reserve your seat today! For more information or to register, please contact Nicole Naidyhorski at (757) 624-3232.

    This program has been approved for 6.5 credit hours toward PHR and SPHR recertification through the Human Resource Certification Institute (HRCI). For more information about certification or recertification, please visit the HRCI homepage at

    The contents of this publication are intended for general information only and should not be construed as legal advice or a legal opinion on specific facts and circumstances. Copyright 2024.